IN THE HIGH COURT OF GAUHATI, ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH
SANJAY KUMAR MEDHI, J.
M/s Rana Construction and Engineers Pvt. Ltd. – Petitioner
Versus
The Union of India and Others – Respondents
W.P. (C) Nos. 5294, 5297, 5298, 5301 of 2022
Decided On : 07-02-2023
Constitution of India,1950 - Article 226 - Eligible Bidder - Notice Inviting Tender - Issuance of Letter of Acceptance - Unreasonable and arbitrary – Entrusted - Performance Security - Demand for deposit - Whether furnishing a bank guarantee in format prescribed in bid documents is an essential requirement in bidding process of Central Coalfields Limited and specifically - Held, Grievance is with regard to demand for Additional Performance Security and said demand is for only reason that bid of petitioner were found to be abnormally low - In case situation of abnormally low bids owner had option of rejecting such bids by citing reasons - It is seen that firstly petitioner was given an opportunity to justify its low rates quoted and thereafter Letter of Acceptance was issued with an additional Clause requiring bidder to submit Additional Performance Security - Court requirement being provided in bidding document itself which admittedly is not subject matter of challenge in opinion of this Court it would not be open for petitioner to challenge imposition of Additional Performance Security as a part of Letter of Acceptance - To understand specific challenge made in these writ petitions prayer/relief is to be carefully examined - Writ Petitions Dismissed.
JUDGMENT :
SANJAY KUMAR MEDHI, J.
1. The subject matter of these four petitions is similar which pertains to a demand for deposit of Additional Performance Security in respect of various works entrusted to the petitioner. It is the case of the petitioner that such demand, apart from unreasonable and arbitrary is a violation of an Office Memorandum dated 12.11.2020. Since the issue is common to all these four writ petitions, those were heard together and are disposed of by this common judgment and order.
2. To address the issue, it is necessary to put on record the facts of the case in brief.
3. The Chief Engineer, Public Works Department had published a Notice Inviting Tender dated 08.04.2022 calling for tenders for constructions of 155 nos. of roads under the PMGSY. The present writ petitions pertain to four out of the aforesaid 155 numbers of works in which the petitioner was found to be the eligible bidder. It is the case of the petitioner that after issuance of the Letter of Acceptance in its favour, he was asked to furnish Performance Security and also Additional Performance Security. The demand for Additional Performance Security was because of the reason that the petitioner had quoted much below the estimated construction cost. The connected writ petitions and details of the work are mentioned herein-below:
Name of the work-upgradation of roads from T04-Abhyapuri Pachnia Road including cross drainage works and routine maintenance of the works for five years under Package No. AS-02-187, PMGSY-III, Batch-1, 2022-23.
Letter of Acceptance dated - 06.08.2022
Contract price - Rs. 10,22,40,436/-
Performance Security - Rs. 25,57,000/-
Additional Performance Security - Rs. 3,78,64,000/-
W.P. (C) No. 5297/2022
Name of the work-upgradation of roads from MRL11-Road from Majirgaon to Borjhar via Agchia including cross drainage works and routine maintenance of the works for five years under Package No. AS-11926, PMGSY-III, Batch-1, 2022-23.
Letter of Acceptance dated - 06.08.2022
Contract price - Rs. 3,60,67,998/-
Performance Security - Rs. 9,02,000/-
Additional Performance Security - Rs. 1,33,06,000/-
W.P. (C) No. 5298/2022
Name of the work-upgradation of roads from MRL07-Tetelia Lakhitari to Maheswari Mitani including cross drainage works and routine maintenance of the works for five years under Package No. AS-11929, PMGSY-III, Batch-1, 2022-23.
Letter of Acceptance dated - 06.08.2022
Contract price - Rs. 4,85,46,891/-
Performance Security - Rs. 12,14,000/-
Additional Performance Security - Rs. 1,79,96,000/-
W.P. (C) No. 5301/2022
Name of the work-upgradation of roads from T05-Dimaruguri Kamarpur Road including cross drainage works and routine maintenance of the works for five years under Package No. AS-17-260, PMGSY-III, Batch-1, 2022-23.
Letter of Acceptance dated - 06.08.2022
Contract price - Rs. 18,39,13,378/-
Performance Security - Rs. 45,98,000/-
Additional Performance Security - Rs. 2,12,29,000/-
4. It is the demand for the Additional Performance Security which is the subject matter of challenge in these writ petitions. It is the case of the petitioner that under Clause 4 of the Office Memorandum dated 12.11.2020, there is no scope for demand of Additional Security Deposit or Bank Guarantee in case of abnormally low bids. However, in spite of the said Office Memorandum still being in force, the said demand has been made and therefore, the present writ petitions.
5. I have heard Shri K.N. Choudhury, learned Senior Counsel assisted by Shri R.M. Deka, learned counsel for the petitioner. I have also heard Shri AK Dutta, learned CGC for the respondent nos. 1 to 3 and Shri D. Saikia, learned Advocate General, Assam assisted Shri B. Gogoi, learned Standing Counsel, PWD for the respondent nos. 4 and 5. The materials placed before this Court have also been careful examined.
6. Shri Choudhury, learned Senior Counsel for the petitioner has submitted that considering the low rate quoted by the petitioner, an analysis of the bid amount and compa
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