IN THE HIGH COURT OF GAUHATI
Prasanta Kumar Deka, J.
Mriganka Sharma - Appellant
Versus
Oil And Natural Gas Corporation And Anr - Respondent
W.P. (C) No. 3230 of 2020, 3079 of 2020
Decided On : 02-03-2021
ONGC - Tender Notice - Pharmacy Act 1948, Article 14 of the Constitution of India - The court found the bid evaluation criteria under the tender to be arbitrary, discriminatory, and violative of the fundamental and Constitutional rights of the petitioner.
Fact of the Case:
The petitioners, local businessmen, challenged a tender notice issued by ONGC, alleging discrimination and denial of a level playing field due to restrictive eligibility conditions for empanelment of retail chain pharmacies.
Finding of the Court:
The court found the bid evaluation criteria to be arbitrary, discriminatory, and violative of the fundamental and Constitutional rights of the petitioner.
Issues: The issues involved discriminatory bid evaluation criteria, the reasonableness of the tender value projection, and the impact on local businesses and fundamental rights.
Ratio Decidendi: The court held that the bid evaluation criteria were arbitrary, discriminatory, and violated the fundamental and Constitutional rights of the petitioner. It also emphasized the importance of a level playing field and legal certainty in government policies and contractual matters.
Final Decision: The court allowed the writ petitions, setting aside and quashing the tender notice and holding the bid evaluation criteria to be arbitrary, discriminatory, and violative of the fundamental and Constitutional rights of the petitioner.
JUDGMENT
Prasanta Kumar Deka, J. - Heard Mr. MK Choudhury, learned Senior counsel assisted by Mr. A Barkataki, learned.1 counsel for the petitioners in both the writ petitions. Also heard Mr. GN Sahewalla, learned Senior counsel assisted by Ms. S Senapati, learned standing counsel for the respondent ONGC.
2. The petitioners are businessmen and proprietors/ partners in the respective firms which deal in supply/ distribution and sale of medicine in Sibasagar district. They have good business relations with the respondent ONGC. They filed these writ petitions challenging inter-alia the tender notice dated 27.07.2020 issued by the respondent ONGC vide Tender No. R16GC20003 inviting online bid / tender for empanelment of retail chain pharmacies/ chemist shops for supply of medicines and consumables against credit notes. The last date of bid submission and opening of techno-Commercial (up-priced) bids was initially fixed on 17.08.2020. The petitioners contended that they have been discriminated and denied a level playing field by imposing restrictive eligibility conditions of having 20 numbers of retail pharmacy outlet and 30 numbers of pharmacists on roll while the scope of work remained the same.
3. Mr. Choudhury referred to the earlier e-tender being No. SVS/MM/MSD/Retail Medicines/(08) R11MC17012 calling for bids from entities interested in being empanelled as Pharmacies/ retail outlet shops at Sivasagar inside ONGC hospital premises (1 no.), Sivasagar Town ( 5 nos.), Nazira inside ONGC colony (1 no.), Nazira Town (4 nos.), Lakwa (1 no.), Geleky (1 No.) for period of three years. The petitioners being eligible and already having undertaken similar contracts with the ONGC earlier participated in the said e-tender and were successful in the technical bid. The petitioners entered into contracts with the ONGC by signing contract agreements for various location and as per the terms of the contracts the existing contracts are going to expire on 12.04.2021. The ONGC issued a fresh tender which is the subject matter in these writ petitions but insertion of certain eligibility criteria for prospective bidders it is doubted that the entire process as well as intention of the respondent ONGC is in order to oust the petitioners being local suppliers of medicine/ owners of pharmacies.
4. The bid evaluation criteria as per the impugned tender are stipulated in clause B.1.2 indicating the eligibility and experience of the bidder. As per the said criteria B.1.2.1(a)-I(i) the bidder should have at least owned twenty operating pharmacy outlets and as per criteria B.1.2.1(a)-I(ii) the bidder should also have at least thirty pharmacists on their roll with valid licenses issued by state pharmacy council/ Indian Pharmacy council under Pharmacy Act 1948 or other relevant Acts. Clause B.2.6.0 stipulates the criteria for ascertaining financial capability. The turnover of bidder must be Rs. 9,08,19,500/- (Rupees nine crores, eight lakhs, nineteen thousand and five hundred) or more and the said turnover is to be considered for evaluation shall be the average turnover of the last two years. The net worth of bidder must be Rs. 2,72,45,850/- (Rupees two crores seventy two lakhs forty five thousand eight hundred fifty) or more and the said net worth shall be based on the latest audited consolidated annual financial statements of the bidder with all its subsidiaries. The petitioners are mainly aggrieved on the said two stipulations.
5. The scope of the impugned tender is for empanelment of retail chain pharmacy for three years for ONGC s Assam Asset. The scope of work is in respect of ONGC hospital at Sibasagar, ONGC dispensary at Nazira, Lakwa and DSA Geleky. Comparing the said scope of work Mr. Choudhury referred the earlier e-tender being No. SVS/MM/MSD/Retail Medicines/ (08) / 2017-18 wherein the scope of work was in respect of empanelment of pharmacists/ retail outlet, supply of medicine etc for a period of three years for Sibasagar inside ONGC hospital premis
BSN Joshi & Sons Ltd. vs. Nair Coal Services Ltd. and Others
Census Commissioner and Others vs. R Krishnamurthy
Jagdish Mandal vs. State of Orissa and Others
Michigan Rubber (India) Limited vs. State of Karnataka and Others
Union of India and Others vs. Dinesh Engineering Corporation and Another
The bid evaluation criteria were found to be arbitrary, discriminatory, and violative of the fundamental and Constitutional rights of the petitioner.
Point of Law – The principles that emerge from the above precedents are, the writ court has limited jurisdiction in matters concerning contracts and invitation to bid for contract; Court must adopt r....
Judicial review of tender conditions is limited; courts should not interfere unless actions are arbitrary, discriminatory, or mala fide, ensuring public interest is prioritized.
The eligibility criteria in a tender for supply of cooked diet to Government hospitals, requiring credential of similar nature of a completed single work having minimum value of 40% of the estimated ....
Point of law: powers of judicial review are limited and while exercising such power the Court has to see whether the process adopted or decision made by the authority is malafideor is intended to fav....
Judicial review is permissible in tender matters only to prevent arbitrariness; criteria should ensure fairness and cannot favor specific bidders without rational basis.
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.