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2008 Supreme(Mad) 408
High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE V. DHANAPALAN
R. Kumar & Another
Versus
The Chief Engineer, Mettur Thermal Power Station, Mettur Dam-636 406
Writ Petition Nos.36006 of 2007 & 36013 of 2007 & 44 of 2008
Decided on : 05-02-2008
For the Petitioners:R.N. Amarnath, C. Uma, Advocates.
For the Respondent:S.N. Kribanandham, Advocate.
The authority of the tender calling entity to impose pre-qualifying conditions and the limited scope of judicial review in contractual matters.
Headnote:
Tender Notification - Railway Track Materials - Specification No.CE/MTPS/SE/P&A/MM/AEE2/O.T.No.577/2007-2008, Specification No.CE/MTPS/SE/P&A/MM/AEE2/O.T.No.584/2007-2008, Specification No.CE/MTPS/SE/P&A/MM/AEE2/O.T.No.591/2007-2008 - The court discussed the legality of the bid qualification requirements and the transparency in the tender process. It highlighted the principles of judicial review in contractual matters and the authority of the tender calling entity to impose pre-qualifying conditions.
Fact of the Case:
The petitioner challenged the tender process for supply of railway track materials, alleging arbitrary bid qualification requirements and lack of transparency.
Finding of the Court:
The court held that the tender calling authority had the prerogative to impose pre-qualifying conditions and that the terms of the invitation to tender were not open to judicial scrutiny. It emphasized the principles of judicial restraint in administrative action and the freedom of contract for the government.
Issues: Arbitrariness of bid qualification requirements, lack of transparency in the tender process
Ratio Decidendi: The court emphasized the authority of the tender calling entity to impose pre-qualifying conditions and the limited scope of judicial review in contractual matters. It highlighted the principles of judicial restraint in administrative action and the freedom of contract for the government.
Final Decision: The writ petitions were dismissed, and the court held that the petitioners had not made out any ground for interference with the decision taken by the Board in making the Bid Qualification Requirements mandatory. No costs were awarded.
Writ Petition No.36006 of 2007 has been filed, praying for issuance of a writ of certiorari, to call for the records of the respondent relating to Tender Notification, dated 210. 2007, issued in Specification No.CE/MTPS/SE/P&A/MM/AEE2/O.T.No.577/2007-2008 and quash the same.
2. Writ Petition No.36013 of 2007 has been filed, praying for issuance of a writ of certiorari, to call for the records of the respondent relating to the Tender Notification, dated 011. 2007, issued in Specification No.CE/MTPS/SE/P&A/MM/AEE2/O.T.No.584/2007-2008, and quash the same.
3. Writ Petition No.44 of 2008 has been filed, praying for issuance of a writ of certiorarified mandamus, to call for the records of the respondent, pertaining to the tender for Supply of Broad Gauge Railway Track Materials to Mettur Thermal Power Station, having reference Specification No.CE/MTPS/SE/P&A/MM/AEE2/O.T.No.591/2007-2008, dated 28th November,2007, and quash the same in so far as Clause 4-provisions 1 to 3 of the Bid Qualification Requirement and consequently direct the respondent to call for fresh tenders for the above said project, setting out reasonable Bid Qualification Requirement commensurate with the project.
4. Since all these Writ Petitions relate to a common issue, they are being disposed of by a common order.
5. According to the petitioner, he is the Managing Partner of M/s.R.K.Constructions, which deals with execution of various construction works, more particularly, laying of railway track works and supply of materials for railway works. The Unit has carried out various works for the Railways and obtained a certificate of appreciation by the Department. Further, the Unit is engaged in the business of contracting railway materials for more than seven years having a turnover of around 10 crores and has recently got the single supply order, dated 22.06.2007, through a tender from Southern Railway for a proposed supply of railway track materials 50 mm hard granite stone ballast for a total value of Rs.2,70,00,000/-. While so, the respondent has issued a Tender Notice on 210. 2007, calling for sealed tenders for supply of Broad Gauge Railway Track Materials to Mettur Thermal Power Station. The said tender is two part system with technical bid and price bid. The tender notice stipulates certain conditions for bid qualification, which are totally arbitrary, illegal and against law inasmuch as the same have been incorporated only to accommodate the persons with vested interest. Further, no transparency is followed in the tender process which would be evident from the fact that even the list of 5 items required to be supplied has not been furnished nor the list in Annexure II & A is published or furnished to anybody. The irregularity committed by the respondent in calling for the tenders for a project containing the terms and conditions would cause irreparable loss to the State exchequer and is gravely prejudicial to public interest by deliberately eliminating competition by imposing arbitrary qualification requirement for participating in the tender, on account of which the petitioner and similarly placed persons are unable to qualify for the bid. Hence, the entire tender process is vitiated by malafide only to facilitate or accept the tender from particular individuals. Hence, he has filed these Writ Petitions, for the relief stated above.
.6. The respondent has filed a counter, stating that 3 kms. Railway Track running from Karumalaikudai to Mettur Thermal Power Station is being maintained by the Tamil Nadu Electricity Board exclusively for the purpose of transporting coal from Chennai Harbour to Mettur Thermal Power Station by Railways. The Department of Railways informed that the Railway Track laid during 1980 was badly worn out and damaged and instructed the Board to rectify the damages and to renew the tracks. As the Department of Railways threatened to discontinue the service if the repair works are not attended to immediately, Mettur Ther
