SupremeToday Landscape Ad
Back
Next
Judicial Analysis Court Copy Headnote Facts Arguments Court observation
Listen Audio Icon Pause Audio Icon
judgment-img

2024 Supreme(Gau) 1777

IN THE HIGH COURT OF GAUHATI
Michael Zothankhuma, J.
Prabhat Fertilizer and Chemical Works - Appellant
Vs.
The State of Assam and Ors. - Respondent
WP (C) No. 6588 of 2023, WP (C) No. 6589 of 2023 and WP (C) No. 6591 of 2023
Decided On: 08-02-2024

Advocates:
Advocate Appeared:
For the Appellant : M.K. Choudhury
For the Respondents: SC

The court held that imposing an experience requirement on manufacturers for government supply contracts, absent from the original tender documents, is arbitrary and unjustified.

Headnote:(A) E-Procurement Notice/NIB dated 29.09.2023 - Corrigendum-I dated 19.10.2023 - Requirement for manufacturers to have experience in supplying quoted items to government departments - The court found the additional condition arbitrary as it was not present in the Standard Bidding Document (SBD) - The court emphasized that the decision-making process must be informed by reason and not arbitrary. (Paras 17, 21, 23)

(B) Judicial Review - The court reiterated that it should not interfere with the terms of a tender unless there is arbitrariness, irrationality, or bias - The interpretation of tender documents should be left to the author unless it is unreasonable. (Paras 12, 14)

Facts of the case:
The petitioners, manufacturers, challenged the Corrigendum-I which imposed a requirement for them to have experience supplying at least 30% of quoted items to government departments, which was not part of the original NIB. (Paras 3, 4)

Findings of Court:
The court held that the requirement for manufacturers to have experience in supplying quoted items to government departments was arbitrary and set aside the Corrigendum. (Paras 23)

Issues: The main issue was whether the additional requirement for manufacturers to have experience in supplying to government departments was justified. (Paras 17, 21)

Ratio Decidendi: The court ruled that the basis for the Corrigendum was non-existent in the SBD, rendering the requirement arbitrary and unjustified. (Paras 18, 22)

Result: The writ petitions are allowed.

ORDER :

Michael Zothankhuma, J.

1. Heard Mr. M.K. Choudhury, learned Sr. Counsel appearing for the petitioners as well as Mr. B. Choudhury, learned Standing Counsel, Agriculture Department.

2. These three writ petitions are being taken up for disposal together, inasmuch as, the issue raised by all the three writ petitioners are similar in nature.

3. The petitioners, who are manufacturers, are aggrieved by the Corrigendum-I dated 19.10.2023, by which a condition has been added to the terms and conditions of the E-Procurement Notice/Notice Inviting Bid(NIB) dated 29.09.2023, wherein manufacturers of the goods offered are to have experience in the supply of the quoted goods, for at least 30% quantity of the quoted items, to any government departments/undertaking/ entities/PSUs, within the last five financial years, i.e., 2018-19 to 2022-23. The stand of the petitioners is that they being the manufacturers of goods, the subsequent requirement of having experience in the supply of materials to government departments is arbitrary, as the first line of contact of the manufacturers is usually their distributors/stockiest/dealers etc. and not the end user/ consumer.

4. The facts relating to the three cases is that E-Procurement Notice/NIBs dated 29.09.2023 were issued by the Agriculture Department for supply of various items. In WP(C) No.6588/2023, the NIB dated 29.09.2023 was with regard to the supply of micronutrients and agricultural lime for the year 2023-24. In WP(C) 6589/2023, the NIB dated 29.09.2023 was with regard to supply of bio fertilizer for the year 2023-24. In WP(C) 6591/2023, the NIB dated 29.09.2023 was with regard to supply of pesticides (chemical bio and botanical) and weedicides for the year 2023-24.

5. Clause 2.5.2 of the Instructions to Bidders (ITB) required the bidders to be one of the following three entities, to be eligible to participate in the bidding process- (i) manufacturer of the goods; or (ii) authorized dealer or distributors of the manufacturer of the goods; or (iii) authorized importer of the manufacturer of the goods.

6. Clause 4.2.1 of the ITB in the NIBs dated 29.09.2023 required the bidders, excluding the manufacturer of the goods offered, to have experience in supplying goods of similar nature of at least 20% quantity to any government departments/ undertaking/entities/PSUs during the last three financial years, i.e., 2020-21, 2021-22 and 2022-23, ending on the last date of bid submission.

7. Thereafter, the respondents issued the impugned Corrigendum-I dated 19.10.2023, wherein a condition was inserted into the NIBs dated 29.09.2023, which required all the bidders including the manufacturers, to have the experience in supply of at least 30% quantity of the quoted items to any government department/undertaking/ entities/PSUs within the last five financial years, i.e., 2018-19, 2019-20, 2020-21, 2021-22 and 2022-23.

8. The learned Senior Counsel for the petitioners submits that reason given by the State respondents in issuing the Corrigendum, requiring manufacturers to have experience in supplying materials to the government, had been done in consonance with the Standard Bidding Document (SBD), which had been alleged to have been inadvertently missed out at the time of issuance of the NIBs. However, the requirement for manufacturers to have experience in supplying materials to government departments is absent in the SBD. He submits that as the very basis for making the Corrigendum, incorporating the additional condition on the manufacturers, to have experience in supplying the quoted items to government departments was absent in SBD, the insertion of the additional condition was unreasonable.

9. The learned Senior Counsel for the petitioners also submits that the condition incorporated by way of the Corrigendum is only an ancillary condition and not an essential condition and as such, the State respondents would have to consider the bids of the petitioners. He also submits that the decision of the responde

Click Here to Read the rest of this document
1
2
3
4
5
6
7
8
9
10
11
SupremeToday Portrait Ad
supreme today icon
logo-black

An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers

Please visit our Training & Support
Center or Contact Us for assistance

qr

Scan Me!

India’s Legal research and Law Firm App, Download now!

For Daily Legal Updates, Join us on :

whatsapp-icon Back to top