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2022 Supreme(Gau) 1386

IN THE HIGH COURT OF GAUHATI
SANJAY KUMAR MEDHI, J.
Plexus Constructions And Engineering Pvt. Ltd. — Appellant
Versus
State Of Assam — Respondent
W.P(C) No. 4510 of 2020
Decided on : 15-12-2022

Advocates:
Advocate Appeared:
For the Appellant :S.Banik, Advocate, S.P.Das, Advocate

The exercise of rounding off bids before adjudging a bid as L1 is impermissible and causes legal prejudice. Transparency and fairness are essential in the tender process.

Headnote:

TENDER - BID REJECTION - [Assam Financial Rules, Clause 256] - The court considered the rejection of the petitioner's bid despite being the lowest (L1) and found that the reasons cited for rejection were irrelevant and extraneous. The court held that the exercise of rounding off bids before adjudging a bid as L1 was impermissible and caused legal prejudice to the petitioner. The court emphasized the importance of transparency and fairness in the tender process and directed the work to be allotted to the petitioner, whose bid was L1.

Fact of the Case:

The petitioner's bid, found to be the lowest (L1), was rejected in a tender process due to reasons deemed irrelevant and unjustified by the petitioner. The petitioner sought the work to be allotted based on its L1 bid.

Finding of the Court:

The court found the reasons for rejecting the petitioner's bid to be irrelevant and extraneous, emphasizing the importance of transparency and fairness in the tender process. The court directed the work to be allotted to the petitioner, whose bid was L1.

Issues: Rejection of the petitioner's bid despite being the lowest (L1), validity of reasons for rejection, violation of principles of natural justice.

Ratio Decidendi: The court held that the exercise of rounding off bids before adjudging a bid as L1 was impermissible and caused legal prejudice to the petitioner. The court emphasized the importance of transparency and fairness in the tender process.

Final Decision: The court set aside the impugned action of holding the petitioner's bid to be non-responsive and directed the work to be allotted to the petitioner, whose bid was L1, strictly in accordance with law.

JUDGMENT :

SANJAY KUMAR MEDHI, J.

The issue involved in this case is rejection of the bid of the petitioner in respect of a tender process in spite of the fact that its bid was found to be the lowest (L1). The decision to reject contains certain reasons, the validity of which has been questioned and further the petitioner by terming those to be irrelevant and unjustified and further contending that there has been gross violation of the principles of natural justice.

2. Before going to the issue, the brief facts of the case can be narrated as follows.

3. The Directorate of Employment and Craftsmen Training, Assam had floated a tender dtd. 12/8/2020 for construction of class room building, approach road, electrification, water supply, sanitary installation etc. at ITI Jorhat under ESDI Scheme. The approximate value of the work was stated to be Rs.56, 34, 090.00 (Rupees Fifty Six Lakh Thirty Four Thousand Ninty) and the time of completion was stipulated at 8 months. The tender was at two bids system, namely, technical and financial.

4. It is the case of the petitioner that the bid submitted by the petitioner was found to be technically responsive alongwith another and therefore the financial bids were taken into consideration. In the financial bid, the bid of the petitioner was found to be Rs.50, 70, 680.64(Rupees Fifty Lakh Seventy Thousand Six Hundred Eighty and Sixty Four paisa) whereas that of the other bidder was found to be Rs.50, 70, 681.37(Rupees Fifty Lakh Seventy Thousand Six Hundred Eighty One and Thirty Seven Paisa) and therefore the was a difference of Rs.0.73 (Seventy Three paisa). The contention of the petitioner is that whatever may be the difference, there is no manner of doubt that the bid offered by the petitioner was found to be the lowest (L1). However, the impugned minutes of meeting dtd. 6/10/2020 would disclose that the work was sought to be allotted to another bidder namely, the respondent No. 5 on the ground that the petitioner was allotted two other works earlier which the same could not be completed within the time stipulated and citing those reasons, a decision was taken to allot any work to the respondent No. 5. It is this decision of the respondents which is the subject matter of challenge in this writ petition whereby a further prayer has been made that the work be allotted to the petitioner on the strength of its bid being declared as L1.

5. I have heard Shri S. Banik, the learned counsel for the petitioner whereas the official respondents are represented by Shri S. P. Das. Though the private respondent No. 5 has been served, the said respondent No. 5 has chosen not to contest this writ petition.

6. This Court has further noticed that while the matter was moved on 28/10/2020, this Court, while issuing notice had further directed that the work should not be proceeded and no Letter of Intent be issued. It is seen that the interim order has been extended from time to time and there is no dispute between the parties that the work has not been proceeded. At this stage, Shri Das, the learned Standing Counsel however submits that as a matter of fact, the Letter of Intent was issued on 14/10/2020 which was prior to the date of the interim order. However, in compliance with the said order, the work was not proceeded at all.

7. Shri S. Banik, the learned counsel for the petitioner has submitted that the reasons cited for depriving the petitioner from the work in spite of being adjudged as the lowest bidder are absolutely irrelevant and extraneous in the facts and circumstances of the case. The learned counsel submits that in the absence of any such stipulation in the tender conditions and having allowed to participate in the bid wherein the bid of the petitioner was also adjudged to be technically responsive, such reasons are absolutely arbitrary only to cause wrongful loss to the petitioner. The learned counsel for the petitioner has also referred to the affidavit of the respondents from which another aspect comes

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