IN THE HIGH COURT OF JUDICATURE AT PATNA
MOHIT KUMAR SHAH, J.
(17.8.2022)
CWJC No.11974 of 2021
Yash Raj : Petitioner
Vs.
Bihar State Tourism Development
Corporation Ltd. & Ors. : Respondents
Government Contract–Tender–Cancellation of tender issued for operation and maintenance of property of Corporation–Decision taken/an Order passed by an authority, has to be judged on its own merit as also on reasons so mentioned therein–Same cannot be judged by and cannot be supplemented by fresh reasons brought by way of counter affidavit or otherwise, which cannot be looked into–No cogent, clear or succinct reasons have been furnished in support of decision to cancel tender in question which is in an indispensable component of a decision making process–Impugned order issued by Managing Director, Bihar State Tourism Development Corporation Limited, quashed–Writ Petition allowed. (Paras 10 to 12)
State of Bihar Vs. Bihar Rajya Bhumi Vikas Bank Samiti, (2018) 9 SCC 472; Poddar Steel Corporation Corporation Vs. Ganesh Engineering Works, (1991) 3 SCC 273; Dharampal Satyapal Ltd. Vs. Deputy Commissioner of Central Excise, Guahati, (2015) 8 SCC 519; Tata Cellular Ltd. Vs. Union of India, (1994) 6 SCC 651; Mohinder Singh Gill Vs. Chief Election Commissioner, (1978) 1 SCC 405–Relied.
MOHIT KUMAR SHAH, J.:–The present writ petition has been filed for quashing the letter dated 19.06.2021 issued by the Bihar State Tourism Development Corporation Limited (hereinafter referred to as the "Corporation") under the pen and signature of its Managing Director, whereby and whereunder the petitioner has been intimated that the tender issued for operation and maintenance of the property of Corporation namely Hotel Lichhavi Vihar, Muzaffarpur has been cancelled on account of unavoidable reasons. The petitioner has further prayed for directing the respondent Corporation to execute an agreement with the petitioner in terms of letter dated 23.02.2021.
2. The brief facts of the case according to the petitioner are that the petitioner company is a joint venture in between M/s Yash Raj Motors Private Limited and M/s Dhrublok Merchants Private Limited. A tender notice was issued by the respondent corporation inviting proposal from experienced private limited companies/ public limited companies etc. in the form of technical bid and financial bid for operation and maintenance of various properties located at different places. The petitioner had also participated in the tender process and had submitted its technical bid and financial bid for the property of the corporation mentioned at serial no. 2 of the tender notice namely Hotel Lichhavi Vihar, Muzaffarpur. It appears that the technical bid of the bidders were opened by the respondent Corporation, whereafter, the petitioner was intimated vide letter dated 19.2.2021 that it has been declared successful in the technical bid in respect of the aforesaid property namely Hotel Lichhavi Vihar, Muzaffarpur and the financial bid shall be opened on 22.2.2021 at 3:00 p.m. Thereafter, the respondent Corporation vide letter dated 23.02.2021, issued under the signature of the Additional General Manager of the respondent Corporation had intimated the petitioner that it has been declared successful in the aforesaid tender for operation and maintenance of the said property namely Hotel Lichhavi Vihar, Muzaffarpur for 10 years. The petitioner was further intimated to deposit the requisite licensing amount for the first year with GST which totals up to a sum of Rs. 1,23,96,550.00 apart from deposit of an equivalent amount as guarantee i.e. a sum of Rs. 1,05,05,551.00 in the form of NSC/Fixed Deposit/Bank Guarantee, pledged in the name of the respondent Corporation. The petitioner was also informed that after deposit of the licensing amount and sureties/ bank guarantee, the order of allotment would be issued and the agreement would be executed. The petitioner had then deposited the licensing amount on 01.03.2021. The requisite security money was also deposited and the necessary information was given to the Additional General Manager of the respondent Corporation vide letter dated 03.03.2021. However, the petitioner was not intimated regarding further development as also regarding execution of the agreement in question for a long time, hence the petitioner had submitted representations to the Managing Director of the respondent Corporation dated 1.4.2021 and 3.6.2021, requesting the concerned authority to execute the agreement with regard to the aforesaid work in question. While the petitioner was waiting for a reply from the respondent Corporation regarding execution of the agreement in question, all of a sudden it received a letter dated 19.06.2021 issued by the Managing Director of the respondent Corporation, whereby and whereunder it was intimated that the tender process for operation and maintenance of the aforesaid property namely Hotel Lichhavi Vihar, Muzaffarpur, has been cancelled and the letter issued earlier by the Corporation dated 23.02.2021 has also been cancelled.
3. The learned senior counsel for the petitioner Shri P.K. Shahi has submitted that except the instant tender work in question all other tender works of the same tender notice have been finalized and the respondent Corporatio
The court clarified that no opportunity of hearing is required for the lowest bidder before cancellation of a tender notice, as no vested right exists until the bid is confirmed.
The unilateral cancellation of a tender without adequate notice or reasons violates principles of natural justice and contravenes contractual obligations.
The main legal point established in the judgment is that the termination of a tender based on reasons unrelated to the business of the petitioner and without a fair opportunity of hearing is violativ....
Court exercising powers under Article 226 of Constitution of India has jurisdiction to examine decision making process without even going into merits of such decision.
The tender inviting authority has the right to accept or reject any bid and to annul the bidding process at any time prior to the award of contract without assigning any reason.
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