2001 Supreme(Ori) 334
2001 (II) OLR — 600
P. K. MOHANTY, J.
M/s. Maa Mangala Construction, Paradip... Petitioner
Versus
Indian Oil Corporation Ltd.and another... Opp. Parties
Original Jurisdiction Case No. 10,303 of 2001
Decided on 9th October, 2001.
For Petitioner:M/s. B. Routray, A. K. Baral, D. K. Mohapatra, B.Rout, P. K. Dash and B. B. Routray
For Opp. parties:M/s. Sanjit Mohanty, N. C. Sahoo, S. P. Panda, S. Patnaik and R. R. Swain
Headnote:1. TENDER — Tender for Hose Handling work contract — One of condition that Tenderer should possess valid E.S.I. Code — After discussing the principle of deduction as per E.S.I.Act held, it is the responsibility of the Principal Employer to make payment of the E.S.I. contribution to the Corporation, hence, insistence for E.S.I. registration is of no consequence — Discussing and analysing the eligibility condition, held it to be illegal and inoperative being based on irrelevant consideration and without any reasonable purpose. (Paras - 7 to 15)
2. EMPLOYEES STATE INSURANCE ACT, 1948 — Sec. 40 — The Principal Employer to pay in respect of every employee whether directly employed by him or by or through an immediate employer, both the employees contribution and the employers contribution and also has to bear the expenses for remitting the contribution to the Corporation — Details of recovery/deduction of payment how to be made from immediate employer, stated. (Para - 9)
3. CONSTITUTION OF INDIA, 1950 — Art. 14 — State action must not be arbitrary, but must be based on some rational and relevant principle, which is non-discriminatory, it must not be guided by any extraneous or irrelevant consideration since that would be denial of equality. (Para - 11)
4. CONSTITUTION OF INDIA, 1950 — Art. 226 — Exercising power — High Court to find out whether the decision making process has proceeded on the basis of principle of law, reasonableness and the principle of natural justice was duly complied with, whether the action of the state or the public authority was done in safeguarding and with due regard to the public interest, whether the State or the public authority granted equal treatment and made a fair play in the whole of the transaction, whether the State or the public authority acted mala fide in dealing with the subject and whether deviation, if any, made is illegal or irregular. (Para - 11)
JUDGMENT
P. K. MOHANTY, J. — The petitioner calls in question, the requirement of possessing an E.S.I. registration Code, as an eligibility condition for participation in the Tender, invited by the Indian Oil Corporation Ltd. on the ground that such a condi¬tion is illegal and inoperative and with an oblique motive.
2. The fact in brief is that, the petitioner ‘Maa Mangala Construction’ is a proprietorship concern engaged in civil con¬tract works and general order supplier, at Paradip in the district of Jagatsinghpur. It claims experience of having executed various works under Hindustan Petroleum Corporation as well as the opp. party, Indian Oil Corporation, two public sector undertakings and at the moment undertaking ‘Hose Handling Work’ under the opp. party-Corporation by virtue of the work order dated 15.3.2001, a copy of which is Annexure-4 to this petition.
3. The opp. party No. 1, Indian Oil Corporation Ltd. (hereinafter called ‘IOC’) has invited tender for Hose Handling Work contract for its Tanker/Barges at Paradip Port vide Tender Call Notice, a copy of which is Annexure-1. One of the eligibility conditions amongst others under Clause (c) of the Minimum Qualifying Requirement was that, the tenderer should possess valid P.F. and E.S.I. Code and parties, who have applied for these Codes and expect to get within 15 days from the last date of opening of the tender may quote. According to the peti¬tioner, it was qualified in all respect in terms of the Tender Call Notice, except possessing an E.S.I. Code, which is legally not permissible nor required to be possessed under the Employees State Insurance Act (hereinafter called ‘the E.S.I. Act’). The petitioner claims that fixation of such a condition as one of the minimum qualifying requirement, is illegal, unreasonable and invalid, since such an E.S.I. Code is neither required under the E.S.I. Act nor it has any reasonable nexus with the object sought to be achieved by the I.O.C., inasmuch as for the self- same work ‘Hose Handling’ which the petitioner is now handling as a con¬tractor under the same I.O.C., a tenderer was not required to possess an E.S.I. Code as is being insisted upon now. It is further stated, that in view of the letter of the I.O.C., requir¬ing the petitioner to obtain the E.S.I. Code, it did make an application to the E.S.I. Corporation, but the Corporation in its letter dated 6.7.2001, a copy of which is Annexure-3, has inti¬mated the opp. party I.O.C., that separate Code number is not required in respect of an Immediate Employer/Contractor, in view of Section 2(9) read with Sections 40 and 41 of the E.S.I.Act. Further the E.S.I. Corporation with regard to the similar work under the Hindusthan Petroleum Corporation, intimated the peti¬tioner that it may comply with the provision of the Act under the Code allotted to M/s. H.P.C.L. which is responsible as the prin¬cipal employer in respect of all employees as per Section 40 of the E.S.I.Act. It is alleged that, the other tenderers like K.B.Das and Sons have also no E.S.I. registration number since it is impermissible and not otherwise required under law. In the circumstances, the petitioner has prayed for declaring, Clause-7 of the check list in Annexure-1 the NIT (which corresponds to Clause-c of Minimum Qualifying Requirement in Annexure-B/1) as illegal and inoperative and thus prayer is made for directing the opp. parties 1 and 2 to consider the tender of the petitioner along with other valid tenders.
4. The opp. parties 1 and 2 have filed their joint counter affidavit, denying and controverting the claim of the petitioner. It is the stand of these opp. parties, that the Indian Oil Corpo¬ration Ltd. is a Government of India undertaking and for operation of its terminals, retail out-lets, it had issued notice inviting tender. The minimum qualifying requirements/condition of tenders are decided by the Tender Committee and such require¬ments/conditions are applicable to all the tenders issued throughout