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2022 Supreme(Kar) 559
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
ALOK ARADHE, J.M. KHAZI, JJ.
Philips India Limited – Appellant
Versus
State of Karnataka – Respondent
W.A. No. 557 of 2022, W.P. No. 8360 of 2022
Decided On : 07-07-2022
Important Points
Subject
Civil Law - Public Procurement
Act Referred
Headnote
TENDER - Public Procurement - Karnataka Transparency in Public Procurement Act, 1999 - Section 16 - AIR 1957 SC 425, (2011) 8 SCC 380, AIR 1961 SC 82 - The court discussed the issue of official bias and the principles of bias by applying the test of real likelihood from the point of a fair-minded informed observer. It emphasized that no man can be a judge in his own cause and justice should not only be done, but manifestly be seen to be done. The court also highlighted the need for reliable evidence to indicate bias and the real likelihood of bias from the perspective of a fair-minded and informed person.
Fact of the Case:
The appellant, a Health Technology Company, filed a writ petition seeking quashment of tenders and setting aside the award of tender in favor of respondent No. 5. The appellant alleged that the statutory remedy under Section 16 of the Act had been rendered inefficacious and illusory, and that the appellate authority was incapacitated to adjudicate the issue due to official bias.
Finding of the Court:
The court found that there was no ground to interfere with the view taken by the learned Single Judge. It dismissed the appeal, stating that there was no material on record to infer any official bias on the part of the appellate authority.
Issues: The issues revolved around the inefficacy of the statutory remedy under Section 16 of the Act, the alleged official bias of the appellate authority, and the compliance of the appellate authority with the directions of the court in a Public Interest Litigation.
Ratio Decidendi: The court emphasized the principles of bias, the need for reliable evidence to indicate bias, and the real likelihood of bias from the perspective of a fair-minded and informed person. It highlighted the importance of justice being seen to be done and the disqualification of a person from adjudicating on the ground of interest in the subject matter of the dispute.
Final Decision: The appeal was dismissed, and the court upheld the decision of the learned Single Judge.
Advocate Appeared:
For the Appellants : Sajan Poovayya, Manu Prabhakar Kulkarni.
For the Respondents: Dhyan Chinnappa, Vijaykumar A. Patil, Shanthibhushan, R.V.S. Naik, Nithin Prasad.
JUDGMENT :
ALOK ARADHE, J.
1. This intra-court appeal takes an exception to order dated 28.06.2022 passed by the learned Single Judge, by which writ petition preferred by the appellant has been disposed of with the direction to the appellate authority to decide the appeal preferred by the appellant within a period of four weeks from 30.06.2022. The learned Single Judge has further directed that interim order dated 05.04.2022 passed in W.A. No. 400/2022 shall continue till disposal of the appeal by the appellate authority. In order to appreciate the grievance of the appellant, few facts need mention, which are stated infra.
2. The appellant is a Health Technology Company, whereas, respondent No. 4 is a Limited Liability Partnership registered under Limited Liability Partnership Act, 2008. Respondent No. 5 is a company incorporated under the Laws of the People's Republic of China and Respondent No. 6 is a company incorporated in India. The Director of Medical Education (hereinafter referred to as ‘DME’ for short) floated following two tenders namely:
(a) for supply and installation of 3.0 Tesla MRI and 128 Slice CT Scanners to Medical colleges/hospitals (TENDER No. 75) dated 10.02.2022
(b) for supply installation of 1.5 Tesla MRI and 128 Slice CT Scanners to Medical colleges/hospitals (TENDER No. 46) dated 20.12.2021.
The aforesaid tenders were invited under two bid system. A pre-bid meeting was held on 15.02.2022 and 23.12.2021 respectively and the terms of the aforesaid tenders were amended.
3. The appellant sent a communication dated 11.02.2022 to the DME and pointed out some discrepancies in the bids of submitted by Respondent No. 4 and 5. However, the aforesaid communication failed to evoke any response. The appellant thereupon, filed an appeal on 09.03.2022 before the appellate authority under Section 16 of Karnataka Transparency in Public Procurement Act, 1999 (hereinafter referred to as ‘the Act’ for short). The appellant thereafter filed applications seeking stay of all further tender proceedings on 24.03.2022.
4. The Principal Secretary to the Government of Karnataka, Health and Family Welfare Department (hereinafter referred to as ‘the Appellate Authority’ for short) issued notices dated 19.03.2022 and 28.03.2022 by which the date of hearing was fixed on 05.04.2022 which was deferred to 06.04.2022. Thereafter on 06.04.2022, the date of hearing fixed for 27.04.2022. It is the case of the appellant that notice dated 08.04.2022 was not served on respondent No. 6. It is also averred that during the course of hearing, the appellate authority indicted that the application for stay has been rejected. However, the copy of the order was not provided to the appellant. It was averred in the writ petition that the appellate remedy as therefore, rendered illusory and contrary to principles of natural justice.
5. It is averred that the appellant on 13.04.2022 learnt that in another matter viz. a public interest litigation, a division bench of this court had recorded the statement of Additional Advocate General about upgradation DIMHANS as higher psychiatry Center. An affidavit was filed on 04.03.2022 stating that MRI machine has been delivered to DIMHANS and the same shall be fully operational from 20.04.2022.
6. The appellant therefore, filed a writ petition on 16.04.2022 stating that the remedy of prosecuting an appeal under Section 16 of the Act has been rendered illusory and inefficacious. The appellant therefore, sought quashment of tender No. 46 and Tender No. 75. The appellant also sought the relief of setting aside the award of tender in favour of respondent No. 5 as an agent of respondent No. 5 for supply and installation of two 1.5 MRI machines on turn key basis for DIMHANS hospital. The learned Single Judge passed an interim order on 19.04.2022 recorded the submission made by learned Additional Government Advocate that pursuant to award of tender to respondent No. 4, respondent No. 4 has already executed the work and CT scanners h
