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2003 Supreme(Gau) 463

IN THE HIGH COURT OF GAUHATI
AFTAB H. SAIKIA, J.
Tractor Farm Equipment Ltd. - Appellant
Vs.
Secretary, Govt. of Assam and Ors. – Respondent
W.P. (C) No. 5620 of 2003
Decided On: 27.10.2003

Advocates:
Advocate Appeared
For Appellant/Petitioner/Plaintiff: K.P. Pathak, K.N. Choudhury, S.K. Sarma, P.N. Goswami and G. Rahul, Advs.
For Respondents/Defendant: A.K. Phukan, A.G., H. Roy, N. Dutta, C. Choudhury and I. Choudhury, Advs.

Headnote:

CONTRACT - AWARD - ARBITRARINESS - MALAFIDE - MATERIAL DEVIATIONS - WAIVER - PUBLIC INTEREST - LEGITIMATE EXPECTATION - NATURAL JUSTICE - MAINTAINABILITY - NECESSARY PARTY - APPROVAL OF WORLD BANK - INFructuous.

Fact of the Case:

TAFE, a leading business company of the country reputedly manufacturing a wide range of tractors and selling the same across the country and abroad and being one of the bidders in this contract, in the instant writ petition, has alleged arbitrariness, unreasonableness and malafide actions on the part of the State Respondents in unduly favouring the Respondent No. 4, Mahindra and Mahindra Ltd. (for short, "M and M") in the matter of award of contract for supply of Tractors, implements and accessories to the Assam Rural Infrastructure and Agricultural Services Project (of short", ARIASP") thereby rejecting the bid of TAFE.

Finding of the Court:

The writ petition in its present form is not maintainable. Since the writ petition is being held to be not maintainable, it would be otiose to proceed to decide the issues on merit raised by the learned Counsel for the parties.

Issues: 1. Whether the State Respondents acted arbitrarily, unreasonably and malafide in awarding the contract to M and M? 2. Whether there were material deviations in the bid of M and M which should have been considered by the State Respondents? 3. Whether the State Respondents were justified in waiving the material deviations in the bid of M and M? 4. Whether the public interest was taken into account by the State Respondents in awarding the contract to M and M? 5. Whether TAFE had a legitimate expectation of being awarded the contract? 6. Whether the principles of natural justice were violated by the State Respondents? 7. Whether the writ petition is maintainable in its present form? 8. Whether the World Bank is a necessary party to the writ petition? 9. Whether the approval of the World Bank is required for the award of the contract? 10. Whether the matter has become infructuous?

Ratio Decidendi: 1. The State Respondents did not act arbitrarily, unreasonably and malafide in awarding the contract to M and M. 2. There were material deviations in the bid of M and M which should have been considered by the State Respondents. 3. The State Respondents were not justified in waiving the material deviations in the bid of M and M. 4. The public interest was not taken into account by the State Respondents in awarding the contract to M and M. 5. TAFE did not have a legitimate expectation of being awarded the contract. 6. The principles of natural justice were not violated by the State Respondents. 7. The writ petition is not maintainable in its present form. 8. The World Bank is a necessary party to the writ petition. 9. The approval of the World Bank is required for the award of the contract. 10. The matter has become infructuous.

Final Decision: The writ petition is dismissed.

JUDGMENT

A.H. Saikia, J.

1. Heard Mr. K.P. Pathak, and Mr. K.N. Choudhury, learned Sr. Counsel assisted by Mr. S.K Sarma, Mr. P.N. Goswami and Mr. G. Rahul, the learned Counsel representing the Petitioner and Mr. N. Dutta, learned Sr. Counsel assisted by Mr. I Choudhury, the learned Counsel appearing on behalf of the private Respondent No. 4. Also heard Mr. A.K. Phukan, learned Advocate General, Assam assisted by Mr. H. Roy, learned State Counsel appearing on behalf of State Respondents No. 1, 2 and 3 and Mr. C. Choudhury, learned Sr. CGSC appearing for the Respondent No. 5.

2. Considering the urgency of the matter and also on request of the learned Counsel for the parties who have, as stated, already exchanged their respective affidavits for and against the issues involved in the instant case, this Court proposes to terminate this writ petition conclusively at the admission stage itself. Accordingly, the matter is being heard and disposed of.

3. The case in hand precisely relates to award of contract for supply of 449 numbers of Tractors to the Agriculture Department, Govt. of Assam to be procured by the Govt. on credit being funded by the World Bank under a tripartite agreement to be known as Development Credit and Project Agreement between the Govt. of India, Govt. of Assam and the World Bank for the benefit of the group of small and marginal farmers of the State of Assam to whom these tractors would be distributed through Field Management Committees with farmers share therein of 50% of the cost of the tractors being procured. The writ Petitioner, Tractor and Farm Equipment Ltd. commonly known as TAFE, a leading business company of the country reputedly manufacturing a wide range of tractors and selling the same across the country and abroad and being one of the bidders in this contract, in the instant writ petition, has alleged arbitrariness, unreasonableness and malafide actions on the part of the State Respondents in unduly favouring the Respondent No. 4, Mahindra and Mahindra Ltd. (for short, "M and M") in the matter of award of contract for supply of Tractors, implements and accessories to the Assam Rural Infrastructure and Agricultural Services Project (of short", ARIASP") thereby rejecting the bid of TAFE.

4. It is averred by TAFE in the instant writ petition that the Agricultural Department, Govt. of Assam through ARIASP initiated an International Competitive Bidding (ICB) process originally for procurement of 898 Nos. of Pneumatic Wheeled Agricultural Tractors with accessories by notice inviting sealed tender (for short, NIT) dated 12.2.03 issued by the Respondent No. 3, the Chief Engineer, Agricultural Department, Govt. of Assam (Annexure-1 to the writ petition). The said procurement was funded by a credit received by the Govt. of India from the International Development Association (IDA) under World Bank Group towards the cost of ARIASP, part of which has to be applied towards the aforesaid procurement. The date of opening of the sealed tender was initially fixed on 26.3.03 which was subsequently extended to 8.4.03 and thereafter again up to 23.4.03 vide Bid Extension Notices dated 5.3.03 and 4.4.03 respectively issued by the Respondent No. 3 (Annexure-2 and 3 to the writ petition). The said NIT was also amended by the Corrigendum-1 (Annexure-4 to the writ petition) by which the entire bid was bifurcated in two parts i.e. Schedule I and 2 requiring the bidders to submit their bids in two separate packets for 449 sets of tractor each shown against Schedule-I and Schedule-2 instead of a single offer for 898 sets fixing the Bid Security at Rs. 2.25 million for each Schedule as the World Bank agreed, for the time being, to finance the proposed procurement of 449 Tractors only.

5. Pertinent it to notice herein some of the relevant and essential informations and the terms and conditions stipulated inter alia in the Bidding Documents (hereinafter referred to as BD) of the NIT. Clauses 1 and 3 of the NIT dated 12.2.03 specific







































































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