The NIT stipulated that tenderers who resile before the validity period shall be liable for forfeiture of EMD. The action of the respondents in seeking change of the rate offered bid amounted to resiling and thus, it was a direct violation of Clause 4(b) of the Tender Conditions and attracted the automatic consequence of breach of EMD.

JUDGMENT :

Sandeep Mehta, J.

The instant intra-Court writ appeal takes exception to the judgment and final order dated 14.08.2018 passed by the learned Single Judge accepting WP(C) No.4340/2008 filed by the respondents herein and quashing and setting aside the letter dated 15.10.2007 issued on behalf of the appellant General Manager, FCI, Regional Office, Guwahati directing forfeiture of earnest money deposited by the respondent No.1 in pursuance of the Notice Inviting Tender (NIT) floated by the appellants inviting bids for transportation of food grains from Tinsukia Railway Siding to the FCI Godown at Tezu including handling work at Tezu for 2(two) years.

2. Admitted facts as emanating from record are that the bids were opened on 03.08.2007. As the bid of the respondent No.1 was found to be compliant to all the requirements of the NIT and as the rate quoted by the respondents at Rs.32.34 per MT, per KM, was the lowest, the same was accepted. However, rather than proceeding with the submission of document(s) and completion of formalities, the respondents herein wrote a letter dated 06.10.2007 to the appellant authority praying that they were from very remote area, had mistakenly quoted 47% higher rate reckoning the FCI rate to be Rs.22 per KM/per MT whereas, the actual rate prevailing in FCI was just Rs.2.25 per KM per MT and thus, the rate offered by them was unworkable and hence, a prayer was made to consider the rate as 247% instead of 47% above the rate of FCI (i.e. Rs.2.25 per KM per MT) so that they could carry out the transportation works smoothly and to the entire satisfaction of the Corporation.

The precise language of the above letter is quoted hereinbelow verbatim for the sake of ready reference:

“1. We are the men of very remote area and earned the bread & butter by doing the business of carriage works in & around Arunachal Pradesh. Generally in Arunachal the flat rate per KM/Qtls for transport works is applicable. So we have no knowledge to calculate the percentage of rate as invited by you in this tender since this is first time FCI invited tender for Arunachal Pradesh Depot.

2. In the tender for Tinsukia to Tezu opened on 03.08.07 we put our rate 47% by taking into account of FCI Rate of Rs.22/-per KM/MT. In case you take into account of Rs.22/-per MT/KM than our rate is Rs.32.34 per MT/KM at 47%.

3. But after opening our bid, we came to know that FCI Rate is 2.25 per KM/MT for this contract and in that case our rate of 47% is totally unworkable and not at all possible to run this contract in comparison with the prevailing market rate of truck hire charge in & around the operational area.

4. Further it is to point out that present approved/minimum workable rate of Govt. of Arunachal Pradesh is Rs.11.50 per MT/KM and in that case how we run the instant transportation works at our such an unworkable rate.

So considering the above, it is earnestly requested your honour to consider our rate as 247% instead of 47% in this contract so that we can carry the said transportation works smoothly and entire satisfaction of the Corporation.

Kindly excuse us being the person of such remote area and consider our above mentioned prayer and give justice in to the matter.”

3. The said request of the respondents was rejected by letter dated 15.10.2007 and the earnest money to the tune of Rs.19,37,020/-deposited by the respondents was forfeited.

Thereupon, WP(C) No.4340/2008 was instituted by the respondents for assailing the letter/order dated 15.10.2007 which came to be accepted by the learned Single Judge observing that the rate offered by the petitioner No.1 being the lowest, it was selected for award of contract. However, realising that the rate so offered was based on misreading of the FCI quoted rate leading to mistake of fact, a bonafide prayer was made by the tenderers that their bid should be construed as 247% above the scheduled rate of Rs.2.25.

4. The learned Single Judge held that there was no concluding contract between the tend