2016 Supreme(Cal) 640
IN THE HIGH COURT AT CALCUTTA
I.P. MUKERJI, J.
Sen Brothers, Engineers & Contractors & Anr. - Petitioners
Versus
Durgapur Municipal Corporation & Ors. - Respondents
W.P. No. 25328 (W) of 2016
Decided On : 15-12-2016
For the Petitioners:Mr. Sabyasachi Chowdhury, Mr. Sandipan Banerjee, Mr. Sabir Ahmed, Mr. A.K. Banerjee, Advocates.
For the Respondents:Mr. Animesh Kanti Ghoshal, Mr. B.P. Das, Mr. K.B.S. Mahapatra, Mr. K. Bhattacharya, Advocates.
For the D.M.C. :Mr. Binay Kumar Panda, Advocate.
A tender evaluation process should be conducted in a transparent and fair manner and not in a mala fide way.
Headnote:
TENDER - QUALIFICATION OF BIDDERS - ACT-SECTION REFERRED : None - Two days' time for objection to pre-qualification of tenderers not given - Tender process not fair or transparent - Tender process set aside and fresh tender process to be initiated within four weeks.
Fact of the Case:
Petitioner, the second-highest tenderer, challenged the selection of the highest tenderer, the private respondent, for a toll tax collection contract. The tender process involved a technical bid and a financial bid to be submitted concurrently online with digital signatures. The petitioner alleged that the private respondent did not produce the necessary partnership document, their income tax documents were not in order, and the certificate by the Panchayat certifying their previous work was doubtful.
Finding of the Court:
The court found that the respondent corporation did not give the petitioner the required two days to object to the qualification of the private respondent as a qualifying tenderer. The court also found that the financial bid was considered and the bid of the private respondents accepted on the same day the tender was opened, which was a breach of the tender conditions.
Issues: Whether the respondent corporation breached the tender conditions by not giving the petitioner two days to object to the qualification of the private respondent.
Ratio Decidendi: The court held that the tender process was not fair or transparent and that it should be set aside. The court stated that the tender evaluation process should be conducted in a transparent and fair manner and not in a mala fide way.
Final Decision: The court set aside the tender process and directed the respondent corporation to initiate a fresh tender process within four weeks of communication of the order.
I.P. MUKERJI, J.
1. This is a writ by the second highest tenderer against the highest. He wants the selection of the highest tenderer, the respondent No. 10 and hereinafter referred to as the private respondent cancelled. The writ petitioner thinks that if such cancellation is ordered by this court he will automatically get the tender.
2. On 4th October, 2006 a tender was published by the Durgapur Municipal Corporation, the first respondent and hereinafter referred to as the respondent corporation. It invited offers for toll tax collection on Hahnemann Sarani, Durgapur from Gamon Bridge More to Gandhi More via. Mayabazar. The contract was valued at Rs. 1,51,00,000/-. A tenderer had to submit an earnest money of a little over Rs. 3 lakhs. The contract was to be for three years. The tender process involved a technical bid as well as a financial bid to be submitted concurrently, online with digital signature. This tender had various eligibility criteria. The offeror had to show work experience of having completed within five years of issuance of the tender, a work of not less than 30% of the contract value or 2 completed works of not less than 20% of the contract value. Or, he had to show 70% completion of a single contract of not less than the estimated value.
3. There were various other terms and conditions mentioned in the tender documents which a tenderer had to satisfy to reach the status of a qualifying tenderer. The petitioner complains that the necessary partnership document was not produced by the private respondent, their income tax documents were not in order, the certificate by the Panchayat certifying the previous work done by them was doubtful.
4. But a point of great substance taken by Mr. S. Chowdhury for the petitioner was that the objection regarding pre-qualification of a tenderer had to be lodged under Clause-20 of the terms and conditions online with the Chairman of the tender evaluation committee, by any person within two days from the date of publication of the list of qualified tenderers. Beyond that time no objection would be entertained by the tender evaluation committee. He said this and it is the most fundamental point in the writ that this two days’ time was not given by the respondent corporation to his client to make an objection against the declaration of the private respondent as a qualifying tenderer. On 16th October, 2016 the petitioner made their offer and on 17th October, 2016 the tender was awarded in favour of the private respondent. Hence, the private respondent was declared as a qualifying tender and their tender accepted, the same day. There was a breach of this condition of the tender by the respondent corporation. The tender process was not fair or transparent and that it should be set aside, learned Counsel submitted.
5. The point for consideration before the court is that under the terms and conditions of the tender, the technical and financial bids were to be submitted concurrently online with digital signatures. There was a provision for “pre-qualification”, which I understand is equivalent to qualifying in the technical bid. The petitioner submitted their bid on 16th October, 2016 at 11.32 a.m. online. There were 11(eleven) bidders. The tender was opened on 17th October, 2016 at 6.05 p.m. Let us assume that the qualified bidders, which were 9 (nine) in number were declared immediately. Any objection regarding their qualification was to be entertained by the Chairman of the tender evaluation committee in the next two days. Therefore, the bid of the private respondent, even if their bid was the highest and the best could not have been accepted before 2 (two) days had elapsed after 17th October, 2016. According to the records disclosed the financial bid was considered and the bid of the private respondents accepted on 17th October, 2016 itself.
6. It is here that the doctrine of mala fide is attracted. Why were two days not given to any objector to object to the qualification