The empowerment of the Zila Panchayat to prescribe reasonable conditions for contract applicants and the validity of such conditions in the absence of conflicting statutory provisions.

JUDGMENT :

Manoj Kumar Gupta, Dinesh Pathak, JJ.

The instant writ petition has been filed praying for quashing of the order dated 4/5.01.2022 and also the contract agreement dated 7.01.2022 executed in favour of respondents no.6 & 7 and for a further direction to respondents no.2 to 5 to accept the technical bids of the petitioner and thereafter proceed to consider the financial bids.

2. The facts in brief necessary for adjudication of the present petition are that the petitioner is a registered firm of C category in Public Works Department, Mirzapur. Respondent no.2, Zila Panchayat invited tenders for various works. The petitioner firm applied for the works shown at serial nos.50, 51, 52, 67, 97 and 98. Its technical bid has been rejected in respect of work no.51 and 52 on the ground that it is not registered with the Labour Department. The decision of Technical Bid Committee dated 4/5.01.2022 in shape of office memorandum is under challenge to the extent it seeks to disqualify the bids of the petitioner firm in respect of work no.51 and 52.

3. The contention of learned counsel for the petitioner is that the Works in respect of which bids were invited are governed by the Uttar Pradesh Kshettra Samiti and Zila Parishad Rules, 1984. Initially Rule 18 permitted participation of only approved contractors whose names figure in a register maintained in the office of the Parishad or Kshettra Samiti in Form No.W-1. Rule 18 was subject matter of challenge in Writ-C No.8847 of 2020 Narayan Verma and another Vs. State of U.P. and 3 others and was decided by a Coordinate Bench by judgement dated 17.3.2020. The Division Bench, after considering Rules 18 and 19, held that the rule framing authority never intended to confine the work contracts of the District Panchayats only to the approved contractors or registered contractors under Rule 18. The relevant part of the discussion from the said judgement is extracted below:-

"By force of clause (iii), the terms used but not defined in the Rules shall have the meaning assigned to them in Rule 2 of the Rules of 1965. On going through the Rules aforesaid we noticed that the term approved contractor is not defined therein too. In absence of the definition of the term aforesaid, the amplitude of it cannot be extended to cause discrimination among the contractors placed on registered roll of government departments and further to restrict the choice of Panchayat Raj institutions to limited sphere. It is always desirable to have a broad and better choice with a view to achieve and attain better quality of work. A statute is required to be interpreted in the fashion that allows it to be workable at its optimum and also in consonance to the thrust of the complete enactment. The position would have been different, if any restriction would have been given in the Rules of 1984 or by specific assertion the "approved contractor" would have been defined in such a manner to create monopoly in grant of work on contract. In entirety, we have to interpret Rule 18 and the term "Approved Contractor" to satisfy thrust of the Rules. As such, a conjoint reading of Rules 18 and 19 of the Rules of 1984 and by taking care of other provisions we have to see the intention of the Rule framing authority. For the reasons already given, we are having no doubt that the Rule framing authority was not intending to confine the work contracts of the district panchayats only to the approved contractors or registered contractors under Rule 18."

4. It is submitted that after the said judgement, Rule 18 was amended by the First Amendment Rules, 2020 notified in U.P. Extraordinary Gazette dated 14th July, 2020. The amended Rule 18 reads thus:-

"18. Registration and qualification of contractors:-

In addition to the contractors registered in all the Zila Panchayats, the contractors also registered in the irrigation department, public works departments of the State Government will be eligible to participate in the tenders to be invited in regard t