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2019 Supreme(SC) 968

SUPREME COURT OF INDIA
S. ABDUL NAZEER, R. SUBHASH REDDY, JJ.
M/S N Ramachandra Reddy – Appellant
Versus
The State of Telangana & Ors – Respondents
Civil Appeal No. 6673 of 2019 [Arising out of S.L.P.(C)No.8185 of 2019]
Decided On : 28-08-2019

Advocates Appeared:
For the Appellant(s) :M. C. Dhingra, Gaurav Dhingra, Kandra Indira, Advocates
For the Respondent(s):M. Yogesh Kanna, Rajarajeshwaran S., Parthasarathi S., Advocates

IMPORTANT POINTS
In absence of any set procedure, action taken by authorities in consonance with Article 14 cannot be faulted unless mala fide.
Courts cannot sit as appellate court while exercising power of review in matters relating to contracts and tenders.
Power of Supreme Court under Article 136 is corrective jurisdiction to settle the law.
Appellate Bench cannot disturb the single Bench order unless perverse.

Headnote:

(a) Government contract - Tender - Owning a hot mix plant within 100 km of last reach of project a precondition - Appellant owning a hot mix plant - Claiming it to be within 100km - Jurisdictional Superintending Engineer reporting the distance as 101.5 km by one route and 99.9 km by alternative route - Respondent objecting - No set procedure to deal with objections - Chief Engineer asking report from an independent authority, SE Karimnagar, who reported the distance as 98.1k - Chief Engineer’s decision to seek report from an independent authority for verification of distance, held, justified being in consonance with Article 14, Constitution of India. (Para 33, 34, 39)

(b) Administration of justice - Government contract - Judicial review - Scope confined to examining only decision-making process, not merits of the decision itself - Courts cannot sit as appellate court while exercising power of review in matters relating to contracts and tenders. (Para 35)

(c) Constitution of India - Article 136 - Power of Supreme Court - Corrective jurisdiction to settle the law. (Para 42)

(d) Constitution of India - Article 226 r/w Clause 15, Letters Patent - Appellate Bench cannot disturb the single Bench order unless perverse. (Para 43)

Facts of the case:

The fourth respondent herein was the writ petitioner wherein who had challenged the award of work of “construction of BT Road from Gujed to Buddaguda, in Mahabubabad District of Telangana State”. The Writ Petition was dismissed by the Single Judge, against which, Letters Patent Appeal was preferred which has been allowed.

Finding of the Court:

The Division bench erred in reversing the order and judgment of the Single Judge.

Result: Appeal allowed.

JUDGMENT :

R. SUBHASH REDDY, J.

1. Leave granted.

2. This civil appeal is filed by the fourth respondent in Writ Appeal No. 153 of 2019, aggrieved by the order dated 13.03.2019, passed by the High Court for the State of Telangana at Hyderabad, allowing intra court appeal, filed under clause 15 of the Letters Patent.

3. The fourth respondent herein was the writ petitioner in Writ Petition No. 23501 of 2018, on the file of High Court of Judicature for the State of Telangana at Hyderabad, wherein it has challenged the award of work of “construction of BT Road from Gujed to Buddaguda, in Mahabubabad District of Telangana State”. Writ Petition filed under Article 226 of the Constitution of India was dismissed by the learned Single Judge, vide order dated 25.02.2019, against which, Letters Patent Appeal was preferred under clause 15 of the Letters Patent. The Division Bench of the High Court by order dated 13.03.2019 allowed the intra court appeal, which order is impugned in this appeal.

4. Necessary facts in nutshell, for disposal of this appeal are as under:

The Roads and Buildings Department of the First Respondent-State of Telangana, floated a tender notice dated 21.04.2018, inviting bids for construction of “BT Road from Gujed to Buddaguda, in Mahabubabad District of Telangana State”. Tender is floated by Standard Bidding Document for Road Connectivity Project for Left Wing Extremism Affected Areas (RCPLWEA) for construction and Maintenance -issued by the National Rural Roads Development Agency, Ministry of Rural Development, Government of India. The appellant and the fourth respondent participated in the tender process by submitting the requisite documents. As per the tender conditions, there is a requirement to furnish necessary certificates from the District Officers of R & B Department to exhibit proof of owning “Batch Type Hot Mix Plant” of capacity 100-120 TPH and that such “Batch Type Hot Mix Plant” shall be located within a distance of 100 kilometers from the last point of working reach, for which, bids are invited. The relevant clause in the tender document under Clause 4.4 B(b) reads as under:-

“Each bidder must demonstrate:

(i) “availability for construction work, either owned, or on lease or on hire, of the key equipment (except Batch Type Hot Mix Plant) stated in the Appendix to ITB including equipments required for establishing field laboratory to perform mandatory tests, and those stated in the Appendix to ITB;

Note: For Batch Type Hot Mix Plant, as per G.O.Rt. No.211, T.R&B(R.1)Dept., Dt.21-04-2018

(a) The bidders shall exhibit proof of owning “Batch Type Hot Mix Plant” of capacity 100-120 TPH and such Batch Type Hot Mix Plant shall be located within a distance of 100 Kms from the last point of working reach for which bids are invited.

(b) The bidders to furnish necessary certificates from the concerned District Officers of R & B where such plants have been located and the District Officers of R & B shall inspect and certify with route maps on the (1) location (2) distance from last point of work reach and (3) ownership of such plants for which the bidders are intending to bid.

(c) The Superintendent Engineer of R & B concerned shall ensure the veracity of such certificate/documents uploaded by the bidders in support of the eligibility criteria on machinery before finalizing the technical evaluation of the bids.”

5. The Bid Document consists of two parts, Part-I & Part-II i.e technical bid and price bid respectively.

6. Pursuant to tender notice, there were two offers by the bidders i.e the fourth respondent as well as the appellant herein. The technical bids were opened on 18.05.2018 at 04:00 P.M. and as the fourth respondent as well as the appellant were qualified in the technical bid, the Part-II bid i.e the price bid was opened on 31.05.2018 at 03:00 P.M.

7. In the price bid, the fourth respondent herein, offered to execute the work at the cost of Rs.31,51,27,865.82 whereas, the appellant offered the cost of Rs.31,31,69,42

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