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2016 Supreme(Del) 3061
IN THE HIGH COURT OF DELHI AT NEW DELHI
BADAR DURREZ AHMED, ASHUTOSH KUMAR, JJ.
ORION SECURITY SOLUTIONS PVT. LTD. – Appellant
Versus
GOVT. OF NCT OF DELHI & ORS. – Respondents
W.P. (C) No. 4296 & 6314 of 2016
Decided On : 22-08-2016
For the Petitioner:Mr. Jayant K. Mehta with Mr. Anshumaan Sahni & Mr. Sukant Vikram, Advocates.
For the Respondent:Mr. Satya Kam, ASC with Mr. Prabhsahay Kaur, Advocate and Mr. Ravinder Kumar.
The main legal point established in the judgment is that the rejection of a bid should be based on objective considerations related to the tender requirements and contract performance, emphasizing the importance of financial viability and compliance with tender conditions in awarding contracts.
Headnote:
TENDER - Security Services - Companies Act, 1956, Income Tax Act, Labour Laws - The court discussed the requirements of the tender document, including the need for bidders to be registered under the Companies Act, 1956, have experience in providing security services, and comply with various statutory requirements under the Labour laws, Income Tax Act, and other regulations. The court highlighted the importance of financial viability and compliance with tender conditions in awarding contracts.
Fact of the Case:
The petitioner sought to challenge the rejection of its financial bid for providing security services to government schools, stadia, and offices under the Directorate of Education, GNCTD. The petitioner was declared L1 bidder for three out of four clusters but was rejected on the ground of low agency charges.
Finding of the Court:
The court found that the rejection of the petitioner's bid based solely on low agency charges was arbitrary and not in line with the tender conditions. The court emphasized the need for an informed decision and highlighted the petitioner's compliance with all other tender requirements.
Issues: The main issue was the rejection of the petitioner's bid based on low agency charges, despite compliance with all other tender conditions.
Ratio Decidendi: The court held that the rejection of a bid should be based on objective considerations related to the tender requirements and contract performance. The court emphasized the importance of financial viability and compliance with tender conditions in awarding contracts.
Final Decision: The court quashed the orders rejecting the petitioner's bid and directed the respondent to reconsider the petitioner's case in light of the court's findings.
ASHUTOSH KUMAR, J.
CM No. 25885/2016 in W.P. (C) No. 6314/2016 (Exemption)
Exemption is allowed subject to all just exceptions.
W.P. (C) 4296/2016 & CM 18104/2016 (stay) & W.P. (C) 6314/2016 & CM 25884/2016
1. The petitioner, Orion Security Solutions Pvt. Ltd through its Managing Director in W.P.(C) No.4296/2016, has approached this Court seeking quashing of a decision dated 23.03.2016 [recorded as minutes of the meeting held on 02.03.2016 passed by the Tender Opening Committee of respondent No.2, Directorate of Education, GNCTD (Caretaking branch)], Government of NCT of Delhi, Old Secretariat, Delhi whereby the financial bid of the petitioner was rejected on the ground that the same was non responsive to the terms of the tender document.
2. In W.P(C) No.6314/2016, the petitioner, by way of abundant caution, has also challenged the order dated 25.04.2016 whereby the e-tender (I.D No.2015_DE_75441_1) of the petitioner regarding providing of security services to Government schools, stadia and offices under the Directorate of Education, Government of NCT of Delhi has been rejected and the petitioner has been requested to take back his EMD/FDR immediately.
3. Thus both the writ petitions are being disposed of by this common judgment and order.
4. The Directorate of Education, GNCTD (Caretaking branch) (respondent no.2) had issued notice inviting e-tenders under three bid system from parties having necessary wherewithal and capacity to deploy adequate number of trained security staff in uniform along with other necessary equipments for providing security services for a period of two years, extendable on yearly basis for a further period of two years in government schools, stadia and field offices of the Department of Education, GNCTD as per the requirements of four clusters namely cluster A, B, C & D under cluster wise bidding system (Headquarters to be the lead office). Under the instructions to the bidders, which is part of the NIT, it is declared that the bidder ought to be a limited/private limited company registered under the companies act, 1956 or Joint Venture Consortium (bidding in the form of partnership/proprietorship firm was not permitted) and should have the experience in carrying out security services in Industrial houses, Government undertakings etc. and should have provided similar kind services for at least three consecutive years, having annual average turnover of 30% of the estimated cost of the cluster concerned and if bids were made for more than one cluster, then the annual average turnover be equivalent to 30% of the total tender value of clusters, during the last financial years in the books of accounts ending 31.03.2013.
5. The bidders, according to the NIT, were required to be registered with the Income Tax and also licensed under the labour laws, EPF Organization and ESI Corporation and should have clearance from Sales Tax Department and IT Department.
6. What is of importance to note is that the bidders/tenderers were required to furnish an affidavit to the effect that they had not incurred any loss in more than two years during the last five years ending 31.03.2013.
7. With respect to award of contract, the NIT clearly stated in clause 17.1 of the Instructions to the Bidders that the successful/qualified bidder whose price bid is found to be the lowest one (L-1) rate in all the clusters i.e., lowest amongst the lowest will be awarded work for the cluster concerned. In remaining clusters, either the work will be awarded to the bidder quoting the lowest rate, at the negotiated lowest of the lowest rate in all the clusters or if it is not feasible, then the former bidder who has been awarded at the lowest of the lowest rate as mentioned above will be awarded work at the lowest of the lowest rate in the cluster concerned and the DoE would have the right to award work of all clusters to one bidder if the circumstances so warranted.
8. Under the general conditions of contract, falling in chapter 3 of the NIT,
