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2014 Supreme(J&K) 241
HIGH COURT OF JAMMU AND KASHMIR AT JAMMU
Bansi Lal Bhat, J.
All LPG Dealers cum Transporters Association & Ors. -Appellant
Versus
Union Of India & Ors. -Resopndent
OWP No. 1490-2013, CMA Nos.118-2014, 119-2014 and 120-2014
Decided On : 13-06-2014
Sunil Sethi, Ravi Abrol, R. Koul.
The court emphasized the limited scope of judicial review in contractual matters and upheld the commercial considerations and essential nature of the introduced conditions for the uninterrupted supply of LPG gas cylinders.
Headnote:
Tender Document - LPG Dealers and Transporters - Clause 3, Clause 18, Sub-clause 5.2, Sub-Clause 5.5 of tender document No.PSO/LPG/PT/P/JAMMU/2013/20 - The court upheld the introduction of 450 cylinder capacity trucks and the differential security deposit for LPG distributors and general tenderers, stating that it was based on commercial considerations and essential for the uninterrupted supply of LPG gas cylinders for the benefit of consumers. The court also rejected the allegations of discrimination and arbitrariness, concluding that the conditions in the tender document were not mala fide or arbitrary.
Fact of the Case:
The petitioners, LPG dealers cum transporters, challenged the tender document issued by the Ministry of Petroleum and Gas and the Indian Oil Corporation, alleging discrimination and violation of fundamental rights under Article 14 and 19(1)(g) of the Constitution of India. The petitioners objected to the introduction of 450 cylinder capacity trucks, differential security deposit requirements, and preferential rights given to Indane distributors.
Finding of the Court:
The court dismissed the petition, stating that the introduction of 450 cylinder capacity trucks and the differential security deposit for LPG distributors and general tenderers were based on commercial considerations and essential for the uninterrupted supply of LPG gas cylinders for the benefit of consumers. The court also rejected the allegations of discrimination and arbitrariness, concluding that the conditions in the tender document were not mala fide or arbitrary.
Issues: The main issues included the introduction of 450 cylinder capacity trucks, differential security deposit requirements, and preferential rights given to Indane distributors, and the alleged discrimination and violation of fundamental rights under Article 14 and 19(1)(g) of the Constitution of India.
Ratio Decidendi: The court's decision was based on the limited scope of judicial review in contractual matters, the commercial considerations and essential nature of the introduced conditions for the uninterrupted supply of LPG gas cylinders, and the absence of mala fides or arbitrariness in the tender document.
Final Decision: The petition was dismissed, and the court upheld the conditions in the tender document, stating that they were not mala fide or arbitrary.
(a) An appropriate writ, order or direction in the nature of writ of certiorari quashing:-
(i) Requirement of trucks (Trala) having the capacity of 450 cylinders as envisages in clause 3 of the tender document No.PSO/ LPG/ PT/ P/Jammu/2013/20 for Transportation of packed LPG Ex-LPG Bottling Plant Jammu;
(ii) Clause 18 of tender document No. PSO/LPG/PT/ P/JAMMU/ 2013/20 for Transportation of packed LPG Ex-LPG Bottling Plant, Jammu.
(iii) Sub-clause 5.2 of clause 19.2 tender document No.PSO/LPG/PT/ P/JAMMU/2013/20.
(iv) Sub-Clause 5.5 of clause 19.2 of tender document No.PSO/LPG/ PT/sP/JAMMU/2013/20 for Transportation of packed LPG Ex-LPG Bottling Plant, Jammu.
(b) An appropriate writ, order of direction in the nature of writ of mandamus commanding the respondents to consider the tender bids of the petitioners in the tendering process for transportation of packed LPG Ex-LPG Bottling Plant, Jammu and award them the transportation contracts without subjecting them to the impugned conditions as envisaged in clause 18 by following terms and conditions of the existing tender/contract so as to enable the petitioners to carry out the transport business and earn their livelihood.
2. Petitioner No.1 is an association of LPG dealers cum transporters. Other petitioners are members of this association. They have a common cause. Some of the petitioners are LPG dealers cum transporters engaged in business of selling the LPG to the consumers while others are transporters engaged in transportation of filled LPG cylinders from LPG plant Bari Brahamana Jammu to various destinations in Jammu and Kashmir. Respondent Nos. 2 to 4 have been inviting tenders for allotting the Contract of transportation of packed LPG and allotting the work to successful bidders. Petitioners case is that the respondents were previously allotting the transportation work on the basis of round trip distance. IOC distributors followed by IOC resellers were given priority for awarding of Contract but the utilization of their trucks was made at par with others. Equal opportunity was provided to various transporters including the petitioners for transportation of LPG cylinders to various locations in the State. According to petitioners this arrangement continued for about thirteen years. However, in the Tender Document dated 29.06.2010 a provision was incorporated in Clause 10.01 to give preference to the tenderer having registered and operational quoted trucks/ LCVs. Petitioner Nos. 2 to 15 were allegedly made to alter their existing transport vehicles as per revised standards prescribed to meet the safety norms. According to petitioners, they had to incur heavy expenditure in effecting such alterations. The Contracts were extended upto end of February 2014. Petitioners are aggrieved of a fresh Tender Document No. PSO/LPG/PT/P/JAMMU/ 2013/20 floated by respondent Nos. 2 to 4 for transportation of packed LPG Ex-LPG bottling plant Jammu in terms whereof provision has been made for requirement of 58 numbers of trucks (Tralla) having capacity of 450 cylinders besides the provision incorporated to the effect that the contractors placing 306 cylinders capacity trucks be asked to deposit Rs. 7.5 Lac per Contract as security deposit whereas the trucks owned by LPG distributors for carrying their own load are subjected to deposit of Rs.50,000/- per truck as security deposit subject to maximum of Rs. 2.00 Lac per Contract. Petitioners allege discrimination between similar set of persons on this score. They are also aggrieved of Sub Clause 5.5 of Clause 19.2 by virtue whereof the Indane Distributors have been vested with preferential right to carry their own load by utilization of their own trucks in the event requirement of trucks as per the NIT is not met. According to petitioners these
