Conditions for additional performance security prior to the enactment of Rule 75A are illegal unless supported by statutory provisions.

ORDER :

1. Learned counsel for both the parties submit that the controversy involved in these writ petitions are squarely covered by the order passed by the Coordinate Bench of this Court in S.B. Civil Writ Petition No. 9620/2011 (Shera Ram Choudhary Vs. State of Rajasthan & Ors.) and other connected matters decided on 28.01.2022 which reads as follows: -

“1. These three writ petitions involve common grievance; common question of law and almost common facts, hence, they are being disposed of by this common order.

2. For the purpose of convenience and clarity, facts of SB Civil Writ Petition No. 9620/2021: M/s Shera Ram Choudhary Vs. State of Rajasthan & Ors. are being taken into consideration.

3. The petitioner is AA Class contractor engaged in execution of construction work awarded by various Government Departments, including Water Resources Department.

4. The respondent No.5 issued an NIT dated 19.03.2021 for “repair and retrofitting of dam” for an estimated cost of Rs.1051.83 lacs. The NIT comprised of various conditions out of which condition No.16 required furnishing of additional performance security in case the bid offered by a bidder was unbalanced bid i.e., the amount offered was less than the permissible limits fixed by the circular dated 11.01.2018.

5. The petitioner participated in the bidding process and was declared as successful bidder having offered 32.69% less amount than the G-Schedule (Rs. 7,07,98,374/-).

6. By way of the letter dated 20.07.2021 issued by the Executive Engineer, the petitioner was asked to furnish additional performance security of Rs.2,38,65,920/- in terms of the circular dated 11.01.2018, as its bid was found to be unbalanced.

7. Mr. Shah, learned counsel for the petitioner submitted that are presentation dated 13.10.2019 was submitted by the Rajasthan Contractors Advisory and Welfare Association, Jodhpur to the Chief Minister and other Government Authorities, inter alia, raising a grievance that the additional performance security being asked for by various Departments of the State was illegal and creating unnecessary financial burden on the contractors, in furtherance whereof, the Finance Department issued a circular/order dated 22.11.2019 endorsing its copies to all the Departments, including Water Resources Department. He zealously read the same and submitted that the Finance Department itself has observed that the action of the Government Departments in demanding additional performance security for unbalanced bid is contrary to law and therefore, the same be done away with.

8. Mr. Shah pointed out that vide order dated 17.12.2019, the Indira Gandhi Nahar Project and vide order dated 17.01.2020, the Public Works Department have stopped to include condition of requirement of additional performance security in their bid documents pursuant to the circular dated 22.11.2019 issued by the Finance Department.

9. Learned counsel for the petitioners argued that the action of the respondents in insisting for additional performance security pursuant to their circular dated 11.01.2018 is otherwise also illegal and without any legal basis.

10. He submitted that all the terms and conditions of tender and contract are governed by the RAJASTHAN TRANSPARENCY IN PUBLIC PROCUREMENT ACT , 2012 (hereinafter referred to as ‘the Act of 2012’) and Rajasthan Transparency in Public Procurement Rules,2013 (hereinafter referred to as ‘the Rules of 2013’). He added that so far as security amount is concerned, the same is governed by Rule 75 of the Rules of 2013 and does not provide for additional performance security or any other type of security, hence, the respondents are legally not justified in requiring the petitioner and other contractors to furnish additional performance security in case of unbalanced bid. He argued that merely because the circular dated 11.01.2018 or the condition that has