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2011 Supreme(Ori) 427

IN THE HIGH COURT OF ORISSA
V. Gopala Gowda, B.N. Mahapatra, JJ.
ORISSAJOB.COM - APPELLANT
Versus
STATE OF ORISSA AND OTHERS - RESPONDENT
Writ Petition (C) No. 28101 of 2011
Decided On : 23-12-2011

Advocates Appeared:
R.K. Rath, M/s M.K. Das, P.K. Nanda, P. Rath, D. Sahoo and A.S. Paul, for the Appellant; B.K. Nayak Addl. Government Advocate (for OPs 1 and 2), Mr. S.K. Sanganeria, P.C. Patnaik, P. Nayak and A. Sanganeria (for O.P. 3), for the Respondent

The court emphasized that the decision making process in contractual matters must be rational, non-discriminatory, and based on relevant principles. It also highlighted the importance of transparency and fairness in the selection process.

Headnote:

Illegal Selection - Contractual Matter - Section 6 1 of TOR, Clause 6.1 and Clause 6.4 of RFP - The court found that the decision making process was vitiated as it was arbitrary, discriminatory and mala fide. The terms of invitation to tender cannot be opened to judicial scrutiny, but the court can interfere if a policy decision is found to be arbitrary, discriminatory or mala fide. The decision of the Project Director to award the contract to the opposite party was set aside, and the petitioner was directed to be awarded the work if they matched the price quoted by the opposite party or else there would be a fresh tender.

Fact of the Case:

The petitioner challenged the decision of the State Project Director, Orissa Poverty Reduction Mission (OPRM) to select the opposite party No.3 as the successful bidder for a project. The petitioner, a Human Resources (HR) Consultancy Firm, participated in the bidding process and alleged that the selection of the opposite party was illegal, arbitrary, and unreasonable.

Finding of the Court:

The court found that the decision making process was vitiated as it was arbitrary, discriminatory and mala fide. The terms of invitation to tender cannot be opened to judicial scrutiny, but the court can interfere if a policy decision is found to be arbitrary, discriminatory or mala fide. The decision of the Project Director to award the contract to the opposite party was set aside, and the petitioner was directed to be awarded the work if they matched the price quoted by the opposite party or else there would be a fresh tender.

Issues: The issues included the legality of the selection process, adherence to the terms and conditions of the tender, and the jurisdiction of the writ court to interfere with contractual matters.

Ratio Decidendi: The court held that the decision making process was vitiated as it was arbitrary, discriminatory and mala fide. The terms of invitation to tender cannot be opened to judicial scrutiny, but the court can interfere if a policy decision is found to be arbitrary, discriminatory or mala fide.

Final Decision: The decision of the Project Director to award the contract to the opposite party was set aside, and the petitioner was directed to be awarded the work if they matched the price quoted by the opposite party or else there would be a fresh tender.

JUDGMENT :

B.N. Mahapatra, J. - In this writ petition, the petitioner challenges the decision of opposite party No.2-State Project Director, Orissa Poverty Reduction Mission (for short, "OPRM") taken on 29.06.2011 under Annexure-7 selecting opposite party No.3-Sumeet Security Service as successful bidder on the ground that the said decision is illegal, arbitrary and unreasonable. Further prayer of the petitioner is to prohibit the said Project Director from entering into agreement with opposite party No.3-Sumeet Security Service and direct the Project Director to declare the petitioner as successful bidder.

2. Petitioner's case in a nutshell is that it is a Human Resources (HR) Consultancy Firm, represented through its Proprietor. It is an empanelled Consultant for supply of human resources to a Project called 'Targeted Rural Initiatives for Poverty Termination and Infrastructure' (for short, "TRIPTI"). The Project Director of OPRM invited proposals on 21.05.2011 to provide consultancy services with regard to supply of human resources at State, District and Block Project Management Units of TRIPTI Project on Outsourcing Basis to the empanelled firms. TRIPTI Project under OPRM is established, managed and administered by the Government Authorities under Panchayati Raj Department, Government of Orissa. Pursuant to the letter of invitation dated 21.05.2011 (Annexure-1) issued by the Project Director, the petitioner as an empanelled Consultant, took part in the pre-bid meeting conducted by the Project Director for the purpose of selection of HR Agency for Outsourcing Manpower to TRIPTI Project for the year 2011-12 along with other five empanelled Consultants including opposite party No.3-Sumeet Security Service, represented through its Proprietor Sri Prasanna Kumar Sahoo. Pursuant to the invitation of bids and pre-bid meeting by the Project Director, the petitioner submitted its bid proposal both technical and financial on 13.06.2011, which is before the stipulated period as per the norms provided by the TRIPTI Mission. After receipt of the tender proposals and complete verification of the technical bids from three bidders, the Project Director short listed the petitioner and opposite party No.3-Sumeet Security Service. Finally, the Project Director, being the Chairperson of the Procurement Committee, illegally accepted the bid of Sumeet Security Service. Hence, the present writ petition.

3. Mr. R.K. Rath, learned Senior Advocate appearing on behalf of the petitioner submitted that the Project Director illegally accepted the bid of opposite party no.3, which is in clear contravention of the terms of reference mentioned in the Request for Proposal (Annexure-2). The Project Director invited bids in a series of predefined formats both in technical and financial bids. In case of technical bids format starts from TECH-1 to TECH-8 and in case of financial bids the format starts from FIN-1 to FIN-6. In the Request for Proposal (RFP) a condition was stipulated that any proposal submitted, which is not as per the format given by the Project Director, shall be treated as non-responsive. Opposite party no.3-Sumeet Security Service submitted its bid with wrong type of technical proposals by changing the standard formats given by the Project Director. Opposite party No.3 has quoted the facts and figures in Form TECH-7 and Form TECH-8, which are staffing schedule and work schedule respectively. Therefore, acceptance of the proposals submitted by opposite party No.3-Sumeet Security Service is completely unreasonable and quite illegal for which the selection is liable to be set aside.

4. It is further submitted that opposite Party No.3 has also submitted the Form FIN-2 and FIN-3 of the financial bid that has no resemblance with the standard formats given by the Project Director. Opposite party No.3 has quoted the facts and figures in Form FIN-2 which is the summery of costs and has also quoted the facts and figures in Form FIN-3, which is the breakdow




































































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