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SUPREME COURT OF INDIA
HEMANT GUPTA, ANIRUDDHA BOSE, JJ.
RAJASTHAN STATE WAREHOUSING CORPORATION – APPELLANT(S)
VERSUS
STAR AGRIWAREHOUSING AND COLLATERAL MANAGEMENT LIMITED & ORS. – RESPONDENT(S)
CIVIL APPEAL NOS. 2651-2656 OF 2020 (ARISING OUT OF SLP (CIVIL) NOS. 7746-7751 OF 2020) WITH CIVIL APPEAL NOS. 2657-2662 OF 2020 (ARISING OUT OF SLP (CIVIL) NOS. 7834-7839 OF 2020) AND CIVILAPPEAL NOS. 2663-2664 OF 2020 (ARISING OUT OF SLP (CIVIL) NOS. 7935-7936 OF 2020)
Decided On : 24-06-2020
(A) Constitution of India – Article 136 – Appeal – Scope and ambit – Though this Court does not generally interfere in an interim order passed in an appeal under Article 136 of Constitution but when after dismissal of writ petition, Division Bench has passed an order of stay without recording any reason affecting revenue of State, this Court cannot not permit public interest to suffer. (Para 8)
(B) Government Contract – Tender – Bidding – Eligibility criteria – Once bidding process is complete, appellant is entitled to take work from successful bidders rather than taking work from short-term tenderers who were granted contract in exigency of situation – In matters of contract, grant of interim order to restrain successful bidders from executing contract is not in public interest, more so, when tender is for storage of food articles in warehouses of State Government undertaking – Grant of interim order which impinges upon grant of contract by appellant is not in public interest that too without recording any reasons when Writ Petition was dismissed by Single Judge – Orders granting status quo set aside – However, grant of contract shall be subject to orders which may be passed by High Court in intra-court appeals pending before it. [Rule 70(8) of Rajasthan Transparency in Public Procurement Rules, 2013] (Paras 10, 11, 12 and 13)
Facts of the case:
Present appeals are directed against the interim order passed by the High Court of Judicature for Rajasthan on 29th May, 2020 and 10th June, 2020 whereby in an intra-court appeal, High Court passed an order of status quo with a further direction that other formalities may proceed but the contract shall not be signed with the leave of the Court.
Findings of Court:
Grant of interim order which impinges upon the grant of contract by the appellant is not in public interest that too without recording any reasons when the Writ Petition was dismissed by Single Judge.
Result : Appeals allowed
JUDGMENT
HEMANT GUPTA, J.
Leave granted.
1. The present appeals are directed against the interim order passed by the High Court of Judicature for Rajasthan on 29th May, 2020 and 10th June, 2020 whereby in an intra-court appeal, the High Court passed an order of status quo with a further direction that other formalities may proceed but the contract shall not be signed with the leave of the Court.
2. The Rajasthan State Warehousing Corporation Ltd. is in appeal aggrieved against the said interim order. It is argued by the learned counsel for the appellant that the tender was given for warehouses at 71 locations on 12th March, 2020 for operation and management of the warehouses under Public Private Participation (PPP) Model. Certain queries were raised by the writ petitioners before the High Court (respondents herein) in respect of clause 5(5)(i) of the notice inviting bid. Such clause reads as under:
“The bidder (either directly or through its 100% owned subsidiary) should have experience in preservation, maintenance and storage of not less than 4.00 Lac MT on an average basis for last 3 Financial years (i.e.: 2016- 17 to 2018-19) of MSP procured food grain, pulses, oil seeds etc. of Central/state government agencies at par with CWC/SWC/FCI/NAFED etc. in any state/union territory across India.”
3. There was pre-bid conference and thereafter certain clarifications/ amendments were issued. The Clause 5(5)(i) was retained as such. The writ petitions were filed challenging the tender conditions and the clarification issued. Such writ petitions were dismissed by the learned Single Bench of the High Court on 19th May, 2020. It was on 20th May, 2020, technical bids were opened and the appellants in Civil Appeals arising out of Special Leave Petitions (Civil) Nos. 7834-7839 of 2020 and Special Leave Petitions (Civil) Nos. 7935- 7936 of 2020 were found to be successful bidders. A letter of intent was issued on 21st May, 2020. In an intra-court appeal, the High Court passed the following order:
“D.B. Civil Special Appeal (W) No. 362/2020, D.B. Civil Special Appeal (W) No. 364/2020 & D.B. Civil Special Appeal (W) No. 372/2020:
Copies of the appeals be served on the Counsel for the intervener through email. Reply affidavit, if any, be filed on or before 05.06.2020 and be exchanged by the parties.
List on 10.06.2020.
In the meantime, status-quo as on date shall be maintained till the next date. Other formalities may proceed, but the contract shall not be signed without leave of this Court.”
4. The High Court maintained the above interim order on 10th June, 2020. The order reads as under:
“Mr. Pankaj Gupta, learned Counsel for the appellant submits that he has complied with the order dated 29.05.2020 and filed the amended cause titles in the Registry last evening.
Registry to verify and act accordingly.
He also submits that he has served copies thereof through E-Mail sent by the AOR.
Learned Counsel submits that the pleadings in the matter are complete and seek urgent disposal of the matter.
Accordingly, the matters stand adjourned to 06.07.2020 for final disposal. Interim order dated 29.05.2020 shall continue till then.
In the meanwhile defect(s) as pointed out by the Registry, be removed.”
5. The argument of Mr. Kapil Sibal, learned Senior Advocate for appellant – Rajasthan State Warehousing Corporation, is that what should be eligibility criteria is to be determined by the Agency inviting bids as it is the best judge of its requirement and expectations from the tenderer. Such condition cannot be challenged on the ground that in the earlier year such was not the condition or similar condition is not the condition of tender in the other States. Mr. Kapil Sibal vehemently argued that for 38 locations, the appellant has granted short-term tender to the writ petitioners for 4 months in the month of March, 2020 and 4 months’ time are going to expire on 3rd July, 2020. The writ petitioners are the successful short-term tenderers who have offered 42% reven
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