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2021 Supreme(Jhk) 249

IN THE HIGH COURT OF JHARKHAND AT RANCHI
RAJESH SHANKAR, J.
Kamaladityya Construction Pvt. Ltd. – Petitioner
Versus
The State of Jharkhand through the Secretary – Respondent
W.P. (C) No. 2249 of 2020
Decided On : 28-06-2021

Advocates:
Advocate Appeared:
For the Petitioners: Mr. Ajit Kumar, Mr. Amritanshu Singh.
For the Respondents: Mr. Ashok Kumar Yadav, Mr. Indrajit Sinha, Mr. Arpan Mishra, Mr. Anil Kumar Sinha, Mr. Krishanu Ray.

Headnote:(A) Instructions to Bidders (ITB) - Clauses 4.3 and 31.1 - Tender process for construction of municipal building - Petitioner sought quashing of decisions based on alleged blacklisting, asserting L1 status after bid reopening - Review committee found petitioner not blacklisted but set negotiation protocols complicating L1's rights - Court evaluates legality based on fairness, compliance, and public interest. (Paras 3, 9, 12, 53)

(B) Judicial Review - Court emphasizes restraint in tender process interference unless decisions exhibit arbitrariness, illegality, or bias; the status of L1 does not confer automatic entitlement without compliance. (Paras 11, 21, 54)

Facts of the case:
The petitioner contested the rejection of its bid due to an alleged blacklisting while awarded an L1 status after review; the tender was awarded to L2 respondent amidst allegations of procedural improprieties.

Findings of Court:
The review committee acted to assess likely bids favorably but violated natural justice; nevertheless, the court determined no arbitrariness existed in the initial disqualification.

Issues: Whether the rejection of the petitioner's bid constituted unfair treatment and appropriate adherence to the tender guidelines?

Ratio Decidendi: The court ruled that the tender authority's discretion should not be unduly constrained but must also observe legal and procedural norms; L1 status alone does not guarantee the contract unless all tender conditions are satisfied.

Result: Writ petition dismissed.

ORDER :

1. The present case is taken up today through Video conferencing.

2. The present writ petition has been preferred for quashing the decisions taken in a proceeding of review meeting relating to irregularities found in execution of the tender of construction of Dhanbad Municipal Building at Dhanbad particularly decision nos. 3 and 4 as contained in Memo No. 1715 dated 01.07.2020 issued by the Joint Secretary, Department of Urban Development and Housing (UDHD), Government of Jharkhand, to the extent where it has been decided that in case bid of the petitioner is found to be the lowest (L-1), the negotiations shall be done with respondent no. 7 for allotting the work on the lowest bid price and further if the negotiations with the said respondent fails, the tender may be cancelled. Further prayer has been made for quashing the work order dated 24.10.2019 issued in favour of the respondent no. 7 on the ground that when the price bid of the petitioner was opened in terms with order dated 01.07.2020, it was found L-1.

3. The factual matrix of the case as stated in the writ petition is that Dhanbad Municipal Corporation (DMC) vide e-Tender Reference No. DMC/02/2019-20 dated 27.05.2019 (hereinafter referred to as the said tender), invited bids for construction of Dhanbad Municipal Building at Dhanbad, Jharkhand. The petitioner having been found eligible for the said tender, submitted its bid and also deposited an amount of Rs. 25,000/- as “Cost of Document” and Rs. 47,97,970/- as “Bid Security” for ensuring its participation in the said tender. The Executive Engineer, DMC issued letter no. 2210 (T.C.) dated 25.09.2019 to the petitioner stating therein that it was blacklisted by the Water Resources Department (WRD), Government of Bihar vide orders contained in memo no. 412 dated 06.02.2018, memo no. 2480 dated 04.07.2018, memo no. 1240 dated 24.03.2014 and memo no. 2691 dated 16.07.2018 and the said facts were not provided in the bid. Further, it was directed to file reply within three days by issuing show cause as to why its bid should not be considered invalid in the light of concealment of the said facts. The petitioner vide letter no. KCPL/Tender/2019-20/46 dated 28.09.2019, submitted its reply stating that the company was not effectively blacklisted. It also provided the details of blacklisting orders and the subsequent reliefs granted by the Patna High Court as well as by the Water Resources Department, Government of Bihar specifically mentioning therein that as on date no order of blacklisting was persisting against it. Thereafter, the petitioner was under an impression that its bid would be opened and in case its bid was found to be the lowest, the contract would be awarded in its favour. However, the petitioner came to know that the Department of Urban Development and Housing, Government of Jharkhand and the tender disposal committee found the petitioner unqualified for the tender process. Thereafter, the DMC selected the respondent no. 7 as the successful bidder and issued work order dated 24.10.2019 in its favour. The petitioner represented the Executive Engineer, DMC, Dhanbad (the respondent no. 6) forwarding the copy of the same to the Chief Minister, Jan Samvad Kendra, Jharkhand highlighting the illegality committed in cancelling the bid of the petitioner and arbitrarily accepting the bid of the respondent no. 7. Thereafter, as per the direction of the Senior Personal Secretary to the Chief Minister, the Deputy Secretary, UDHD, Government of Jharkhand, took cognizance of the matter and issued memo no. 1056 dated 13.03.2020 staying the entire work order as well as the agreement of the said tender. Subsequently, the UDHD, Government of Jharkhand, constituted a review committee for looking into the matter of irregularities committed in allotment of the said tender which thereafter took unanimous decisions as contained in memo no. 1715 dated 01.07.2020 accepting the fact that the petitioner-company was not blacklisted in

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