Back
2018 Supreme(Jhk) 1001
IN THE HIGH COURT OF JHARKHAND AT RANCHI
D.N. PATEL, AMITAV K. GUPTA, JJ.
Ramesh Kumar Agarwal, son of late Ratan Lal Agarwal - Appellant
Versus
Food Corporation of India, through its Chairman-cum-Managing Director and Ors - Respondent
L.P.A. No. 197 of 2013
Decided on : 29-08-2018
Advocate Appeared:
For the Appellant :Mr. Sumeet Gadodia, Advocate Mr. Vivek Raj, Advocate Mr. Ashwini Bhushan, Advocate Mr. Ritesh Kumar Gupta, Advocate
For the Respondents:Mr. Satish Bakshi, Advocate
Headnote:
Indian Contract Act, 1872 – Sections 3, 10, 31 – Tender – Letters Patent Appeal has been preferred by the original petitioner whose writ petition being W.P. (C) was dismissed by the learned Single Judge vide judgment and order and hence, the appellant (original petitioner) has preferred the present Letters Patent Appeal – Notice inviting tender was floated by the Food Corporation of India-respondent no.1 for construction of the godown etc. at district-Koderma – Held, Appellant has filled-up bids, i.e., technical bid and financial bid or the offer was put by this appellant that for a particular consideration, this appellant is ready and willing to construct the godown etc. as per notice inviting tender. – It further appears from the facts of the case that whenever such type of construction activity is involved, the offer has to remain valid for a limited period otherwise, if the amount is offered today for construction of the godown and if actual construction is to be done after five years, the cost of construction will be more than double. – This is by way of illustration – In short, whenever any financial aspect is involved in the notice inviting tender, there is bound to be a validity of the offer for a limited period. – It ought to be kept in mind that whenever any offer is placed by the offeree for the construction etc., and the lowest amount is quoted for the construction, in such eventuality, the offer of the offeree cannot be valid for infinite time, otherwise, as for example e.g., today the offer is made to construct a particular building in Rs.5 lakhs and the actual construction is to be made after five years, the offer shall not be valid for five years because the cost of construction might have been enhanced. – Here, the offer was made by this appellant for the construction of the godown etc., at district-Koderma, looking the condition no.11 of the notice inviting tender, as stated hereinabove, the bid/offer of this appellant was never valid for infinite time. – It was valid anyway for 90 days and thereafter for further period of 45 days, as stated hereinabove, the last date for validity of the period of bid was 10th April, 2012. – There is a clause for further extension of the validity of the bid also, as per condition no.11 of the notice inviting tender, but, it was by mutual consent of the parties. – This consent was never given by this appellant. – Thus, validity of the bid was never extended by mutual consent beyond the period of 10th April, 2012. – Thus, the offer comes to an end automatically after the expiry of its validity period, as stated in condition no.11. – There cannot be a validity period of offer for months together and years together, especially when the acceptor is a Government or Governmental institutions in which validity period slowness is inbuilt. – Private parties has their own speed. – Hence, this type of “validity period” of an offer is incorporated in the notice inviting tender. – Once the validity period of the bid is over by the cessation of the time or because of efflux of time it cannot be accepted by respondent no.1 unless, validity period of the bid is extended by mutual consent as per condition no.11 of the notice inviting tender. – There is no extension of the validity period of the bid by mutual consent. – This aspect of the matter has not been properly appreciated by the learned Single Judge while dismissing the writ petition preferred by this appellant. – Hence, the judgment and order passed by the learned Single Judge in W.P.(C) deserves to be quashed and set aside. – It appears from the facts of the case that once the validity period of the offer comes to an end, and the said validity has not been extended by mutual consent, it could not have been accepted by respondent no.1. – The offer is accepted on 12th April, 2012 and not on 10th April, 2012. – The date of acceptance is not to be looked into at all, but, the date on which the acceptance is put in transmission is to be looked into (As per Section 4 of the Indian Contract Act, 1872). – In the facts of the present case, acceptance was put in transmission – Thus, there is no consensus ad-idem and hence, also such type of acceptance of the offer cannot be resulted into a valid contract because there was no valid acceptance of the offer at all on 12th April, 2012. – The offer was over on 10th April, 2012. – As a cumulative effect of the aforesaid facts and reasons, court hereby quash and set aside the judgment and order delivered by Single Judge in W.P.(C) – Court hereby, direct respondent no.1 to return the amount of the bank guarantee of Rs.15 lakhs and the amount of the earnest money of Rs.3 lakhs with a simple interest @ 5% per annum – Order Accordingly
D.N. PATEL, J.
1. This Letters Patent Appeal has been preferred by the original petitioner whose writ petition being W.P. (C) No.2696 of 2012 was dismissed by the learned Single Judge vide judgment and order dated 8th October, 2012 and hence, the appellant (original petitioner) has preferred the present Letters Patent Appeal.
2. Factual Matrix:
• Notice inviting tender for construction of godown at district Koderma was published by Food Corporation of India on 19th October, 2011.
• This appellant had offered for construction of the godown. The technical bids and financial bids were submitted which were opened by the respondent no.1 and this appellant was found to be lowest no.1.
• Whenever any financial aspect is involved, there is always a condition that offer shall be valid for a particular period. This condition may be imposed by an offeror or in the notice inviting tender itself.
• This condition has a direct nexus with inflation. Today’s condition for construction of the godown in rupees ‘X’ cannot be valid for one dozen years, because, the cost of construction is enhancing day by day.
• Looking to the condition in notice inviting tender which is a condition no.11 the offer of the offeror was valid for 90 days from the date of which the bid was opened (28th of November, 2011). There is also mentioning about further extension of 45 days at the behest of the Food Corporation of India.
• Food Corporation of India exercises this option to extend the validity of the bid for further 45 days, after expiry of 90 days from the date on which the technical bid was opened. Thus, the technical bid was opened on 28th November, 2011; hence, 90 days will be over on 23rd February, 2012. Further extension of period of validity of the bid of 45 days will also be over on 10th April, 2012.
• Now, the bottle necks starts. Food Corporation of India has sent e-mail on 16th April, 2012 that vide letter of Food Corporation of India dated 10th April, 2012, the bid has been accepted. This e-mail dated 16th April, 2012 contains the letter dated 10th April, 2012.
• On 14th April, 2012, this appellant has written a letter to Food Corporation of India for returning of –
(a) Bank guarantee worth Rs.15,00,000/-
(b) Earnest money worth Rs.3,00,000/-
• Moreover, the respondent has dispatched the letter dated 10th April, 2012 on 12th April, 2012 by speed post, which was received by this appellant on 18th April, 2012.
• Thus, the validity of the bid initially was only up to 23rd February, 2012 and after the extension of period of 45 days it was valid only up to 10th April, 2012. Thereafter, there was no validity of the bid, as per Condition no.11 of the notice inviting tender floated by the Food Corporation of India and before the e-mail is sent by the Food Corporation of India dated 16th April, 2012, a letter was written by this appellant dated 14th April, 2012 that the Bank guarantee may be returned and earnest money may also be returned.
• Neither the Bank guarantee money was returned nor the earnest money amount was returned hence, a writ petition was preferred by this appellant being W.P. (C) No.2696 of 2012 which was dismissed by the learned Single Judge and hence, the original petitioner has preferred the present Letters Patent Appeal.
3. Argument canvassed by learned counsel for the appellant:
(i) Counsel appearing for the appellant has submitted that in pursuance of the notice inviting tender by the Food Corporation of India dated 19th October, 2011 a bid for construction of godown at district Koderma was filled up by this appellant and given to the Food Corporation of India. As the said bid contains the cost of construction of the godown, always it has a valid period for few months which is 90 days as per Condition no.11 of the notice inviting tender from the date of opening of technical bid. Technical bid was opened on 28th November, 2011. Thus, initially the bid was valid up to 23rd February, 2012. This period of validity can be extended for further period
