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IN THE HIGH COURT OF GAUHATI
Sudhanshu Dhulia, Manash Ranjan Pathak, JJ.
Oil and Natural Gas Corporation Ltd. and Another - Appellants
Versus
Prabal Sharma and Others - Respondents
Writ Appeal No. 116 and 117 of 2021
Decided On : 29-06-2021
Constitution of India, 1950, Articles 14, 19(1)(g), 21 – Contractual matters — Retail Chain Pharmacy – Pre-condition qualifications for the bidders – Supply and distribution of medicines — Writ appeals have been filed by the appellants challenging the order passed by the learned Single Judge by which the writ petitions of the private respondents have been allowed – Issues raised in both the writ petitions were common, hence they were disposed of by a single order – Held, Court can see the doctrine of level playing field and violation of article 19(1)(g) have been mentioned by the hon'ble Apex Court in an entirely different context. What is significant thought is that even in the said judgment, two aspects are absolutely important - It must be stated that the ONGC is the best judge to evaluate as to what is most suitable to its employees and if in its judgment they have come to the conclusion that the present process would suit them better, then the process cannot be faulted merely because the petitioners are now ineligible to meet the pre-conditions. On our consideration of all the relevant factors, we have absolutely no doubt in our mind that under the new scheme the interest and well being of the employees of ONGC was the prime considerations – Scheme and its conditions are in public interest and, therefore, even if the implementation of the scheme is contrary to the interest of a few chemists and pharmacists, it will not run contrary to the overall merit of the scheme – Court allow writ appeal.
JUDGMENT :
SUDHANSHU DHULIA, J.
Heard Mr. G.N. Sahewalla, learned senior counsel, assisted by Mr. K. Choudhury and Mr. M.K. Mahanta, learned counsel for the appellants. Also heard Mr. M.K. Choudhury, learned senior counsel, assisted by Mr. P. Bharadwaj, learned counsel, appearing for the respondents.
2. Both the writ appeals have been filed by the appellants challenging the order dated 2.3.2021 passed by the learned Single Judge in WP(C) No. 3230/2020 and WP(C) No. 3079/2020, by which the writ petitions of the private respondents have been allowed. The issues raised in both the writ petitions were common, hence they were disposed of by a single order.
3. The petitioners before the learned Single Judge were carrying on the supply and distribution of medicines in Sivasagar District of Assam. In Sivasagar District, Oil & Natural Gas Corporation Ltd., i.e., ONGC, has a huge presence. ONGC has its office at Sivasagar and it carries its works of drilling and oil exploration in that area. The petitioners were earlier supplying medicines to the employees of ONGC but now they are aggrieved as ONCG has now come up with a new policy. In its new tender notice dated 27.7.2020, which was issued by ONGC, it has invited online bids for empanelment of retail chain pharmacies/chemist shops for supply of medicines and consumables against credit notes, by laying down some pre-condition qualifications for the bidders. The case of the petitioners was that they were being discriminated and were denied a level playing field by imposition of these pre-conditions, such as a bidder must have at least twenty numbers of retail pharmacy outlet and thirty numbers of pharmacists on roll; turnover of bidder should be Rs. 9,08,19,500 and the minimum net worth of a bidder must be Rs. 2,72,45,850. All these conditions the petitioners are admittedly not able to meet. The case of the petitioners was that earlier they were eligible and were having business with ONGC for supply of medicines but now they have been discriminated due to the present pre-conditions. Another argument, which was placed by the petitioners before the learned Single Judge was that the land was acquired from the people of Sivasagar by ONGC and they have been carrying out their businesses with ONGC for long and in fact the conditions are such that not only no one in Assam but nobody in the entire North East can meet such conditions. The eligibility and experience of the bidder, which were given in B.1.2, are as follows
B.1.2.1(a)-I(i) Bidder (i.e., Single bidder/Indian Joint Venture Company Incorporated) should have at least twenty owned operational pharmacy outlets.
B.1.2.1(a)-I(ii) The bidder should also have at least thirty pharmacists on their roll with valid licences issued by State Pharmacy Council/Indian Pharmacy Council under Pharmacy Act, 1948 of other relevant Acts.
To this effect, i.e., clauses B.1.2.1(a)-I(i) and B.1.2.1(a)-I(ii), valid trade licence (issued by respective State Govt. authorities), Drug Licenses (issued by State Pharmacy Council/Indian Pharmacy Council under Pharmacy Act, 1948 or other relevant Acts) and other statutory licences issued by the local body/authority should be enclosed with the bid.
Above licences should be valid as on the date of opening of techno-commercial bid. Bidder should submit an undertaking to keep these licences valid throughout the contract period and will produce as and when required by ONGC.
B.1.2.1(a)-I(iii) The bidder should have minimum three years of experience in similar services, viz., stocking and disbursing the medicines and other hospital related materials/consumables to the employees of Government Department/State or Central Public Sector Companies/Public Limited Company through the retail out let.
B.1.2.1(a)-I(iv) Bidder should have executed at least 01 (one) contract of similar nature for
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.
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 in tenders limited to mala fides, arbitrariness, irrationality impacting public interest; courts defer to authority's interpretation of eligibility unless perverse.
Judicial review is permissible in tender matters only to prevent arbitrariness; criteria should ensure fairness and cannot favor specific bidders without rational basis.
The main legal point established in the judgment is the limitation of judicial review in tender matters, the need for commercial prudence in evaluating tenders, and the importance of fairness and non....
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