IMPORTANT POINT
The exemption for Micro and Small Enterprises under the Public Procurement Policy does not apply to work contracts, as clarified by the Ministry of MSME.

ORDER :

DEVASHIS BARUAH, J.

1. Heard Mr. R. Choudhury, learned counsel for the petitioner and Mr. S. Mitra, learned counsel for the respondent no.1. Mr. D. Senapati, learned counsel appears for the respondent no.2.

2. The petitioner is aggrieved by the disqualification of his Technical Bid, pursuant to the Invitation for Bid (IFB) dated 16.04.2024 (hereinafter referred to as the “NIT”) for “Composite Works on Open Domestic Competitive Bidding Basis”.

3. The petitioner’s case is that the petitioner being a Micro and Small and Small Enterprise (in short “MSE”), the petitioner was not required to deposit the Earnest Money Deposit (EMD) for participating in the tender process, in terms of the 2012 Public Procurement Policy (PPP-2012) issued by the Ministry of Micro, Small and Medium Enterprises, Government of India. However, in spite of the exemption given to the MSEs in terms of PPP-2012 exempting them from submitting EMD, the petitioner’s Technical Bid has been disqualified on the said ground.

4. The petitioner’s counsel submits that the rejection of the petitioner’s Technical Bid should be set aside as the same is arbitrary.

5. Mr. S. Mitra and Mr. D. Senapati, learned counsels for the respondents submit that there is no infirmity with the decision taken by the respondent authorities, inasmuch as, the NIB required the doing of work contracts which does not come within the purview of the Public Procurement Policy made by the Central Government. He further submits that at the time of issuance of the NIT dated 16.04.2024, there had been a clarification of the earlier PPP-2012 due to Frequently Ask Questions (FAQs), vide communication dated 31.08.2023 issued by the Ministry of Micro, Small & Medium Enterprise, Government of India, wherein it was stated that irrespective of the product category, the benefits of Public Procurement Policy , such as, exemption from payment of EMD, free tender document shall be given to all eligible MSEs, except for traders and in works contracts. The counsels for the respondents further rely upon the judgments of the Delhi High Court, Bombay High Court and Allahabad High Court to buttress his submission that work contracts do not come within the purview of the PPP-2012 issued by the Central Government.

6. The learned counsels for the respondents further submit that the contract work has already been allotted to one of the eligible bidders, i.e. Bridge and Roof Company Limited, who has already started the work. However, the said successful tenderer has not been made a party. They also submit that in terms of the judgment of the Supreme Court in the case of Afcons Infrastructure Ltd. Vs. Nagpur Metro Rail Corporation Ltd. & Another, reported in (2016) 16 SCC 818 , it was held that it would be appropriate for Constitutional Courts to insist on all eligible bidders to be made parties in proceedings filed by unsuccessful or ineligible bidder. As the petitioner has not impleaded all the eligible bidders and/or the successful bidder in the present case, the writ petition should be dismissed for non-joinder of necessary parties.

7. I have heard the learned counsels for the parties.

8. The short question that falls for consideration is whether the exemption provided to MSEs in the PPP-2012, regarding deposit of EMD for MSEs, would cover work contracts.

9. In the case of M/s Shree Gee Enterprise vs. Union of India and Another, reported in 2015 0 Supreme (Del) 4396 , the Division Bench of the Delhi Court had referred to Question No.18 in the Office Memorandum dated 20.02.2014 issued by the Director of the Office of the Development Commissioner, Ministry of MSME, Union of India, as to whether the PPP-2012 would be applicable for works/trading activities also. The answer provided was that the policy was meant for procurement of only goods produced and services rendered by M