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IN THE HIGH COURT OF JUDICATURE AT ALLAHABAD
Vivek Kumar Birla, Vikas Budhwar, JJ.
Ravi Offset Printers And Publishers Pvt. Ltd. - Petitioner
Vs.
State Of U.P. And Others - Respondent
WRIT - C No. - 13077 of 2022
Decided On : 11-05-2022
TENDER - JUDICIAL INTERFERENCE - SCOPE - CONDITIONS IN TENDER - INTERPRETATION - COURT'S POWER - ARBITRARINESS - MALA FIDES - PUBLIC INTEREST - ESSENTIAL CONDITIONS - RELAXATION - CONTRACTUAL MATTERS - JUDICIAL REVIEW - PRINCIPLES.
Fact of the Case:
Petitioner, a private limited company engaged in the trade of printing and supply of books pertaining to NCERT, applied for e-tender for providing NCERT books for the academic years 2020-2021 and 2021-2022. Petitioner was found to be the lowest bidder and awarded the contract. However, due to the COVID-19 pandemic, petitioner could not execute the agreement and disputes arose between the petitioner and the second respondent, Madhyamik Shiksha Parishad, with regard to the payment of royalty and GST. Petitioner filed an arbitration petition and also challenged the impugned tender conditions under sub-clause 1 and 4 of clause 9(A) of the e-tender dated 21.04.2022, alleging that they were arbitrary, discriminatory, and violative of Article 19 of the Constitution of India.
Finding of the Court:
The court held that the conditions embodied in sub-clause 1 and sub-clause 4 of Clause 9(A) of the tender dated 21.04.2022 are not violative of Article 19 of the Constitution of India. The court observed that the best suited authority to incorporate the terms and conditions of the contract/tender are the framers of the tender and that the impugned clauses do not suffer from any infirmity or illegality. The court further held that judicial interference in the matter of tenders and contracts is limited and that the court should exercise restraint in interfering with the administrative decision-making process. The court also noted that the impugned conditions were not arbitrary or irrational and that they were intended to ensure that only eligible and qualified bidders participate in the tender process.
Issues: 1. Whether the impugned tender conditions under sub-clause 1 and 4 of clause 9(A) of the e-tender dated 21.04.2022 are arbitrary, discriminatory, and violative of Article 19 of the Constitution of India? 2. Whether the court can interfere with the policy of the Government in the matter of contract/tender when the same is arbitrary or unreasonable?
Ratio Decidendi: 1. The court held that the impugned tender conditions are not arbitrary, discriminatory, or violative of Article 19 of the Constitution of India. The court observed that the best suited authority to incorporate the terms and conditions of the contract/tender are the framers of the tender and that the impugned clauses do not suffer from any infirmity or illegality. 2. The court held that judicial interference in the matter of tenders and contracts is limited and that the court should exercise restraint in interfering with the administrative decision-making process. The court also noted that the impugned conditions were not arbitrary or irrational and that they were intended to ensure that only eligible and qualified bidders participate in the tender process.
Final Decision: The court dismissed the writ petition, holding that the impugned tender conditions are not arbitrary, discriminatory, or violative of Article 19 of the Constitution of India.
JUDGMENT :
Vivek Kumar Birla, Vikas Budhwar, JJ.
1. The extent and the scope of judicial interference in writ jurisdiction in the matter of tenders so floated by public authorities is the subject matter of present proceedings.
2. Factual matrix of the case as worded in the present petition are that the petitioner claims itself to be a private limited company by the name and style of Ravi Offset Printers And Publishers Pvt. Ltd. having its office at C60, 61, 62, 63 EPIP, Shasti puram, Agra-282007 engaged in the trade of printing and supply of books pertaining to educational stream in the State of U.P. According to the petitioner, it applied for e-tender referable to the academic years 2020-2021 and 2021-2022 for providing the books pertaining to NCERT (National Council of Educational Research and Training). It has come on record that in the year 2020 itself the petitioner participated in the e-tender and deposited the earnest money in the form of FDR no. 774111 for an amount of Rs. 12,62,000/- along with the prescribed tender fee and thereafter, the petitioner was found to be the lowest bider and awarded contract which eventually culminated into execution of agreement of 03.03.2020 between the second respondent (Madhyamik Shiksha Parishad) on one hand and the petitioner on the other hand for the purpose in printing and supply of NCERT books for class IXth to XIIth for the student studying in Government aided/unaided recognized schools in State of U.P.. It has further been averred that a work order was on 07.03.2020 with regard to printing and distribution of NCERT books.
3. Pleadings further reveals that due to the onslaught of the pandemic relating Covid-19 a nationwide lockdown was put to motion resulting that all the commercial activities came to stands still and the petitioner could not execute agreements and honour the commitments and the obligations which it wanted to discharge as a bidder. On account of the circumstances so occasioned as referred to above certain disputes arose between the petitioner and the second respondent with regard to the payment of royalty and GST amount necessitating issuance of demand notice dated 12.03.2020, 18.06.2020, 10.08.2020, 01.10.2020, 24.11.2020 and 30.12.2020 seeking recovery of a certain amount. The petitioner herein as per its own saying took recourse to arbitration while invoking arbitration clause and thereafter, preferred an Arbitration and Cancellation Application under Section 11(4) no. 14 of 2021 being (Ravi Offset Printers And Publishers Pvt. Ltd. s. Madhyamic Siksha Parishad U.P.) before the Court which came to be decided while appointing one of the retired judge of this Court as the sole arbitrator. Record further reveals that the petitioner preferred claim petition before the sole arbitrator which is annexed as annexure-3 at page no. 36 of the petition along with stay application seeking following reliefs:-
(iv) Direct the Opposite Party to discharge/release the FDR No.774111 dated 03.02.2020, amounting to Rs. 12,62,000/-, deposited by the Claimant as Earnest Money Deposit.”
4. According to the learned counsel for the petitioner the arbitration proceeding which are stated to be pending before the sole arbitrator being arbitration case no. 14 of 2021 was begin lingered on, on account of non-cooperation of respondents as they have not even deposited the fee of the learned Arbitrator and in fact on 22.03.2022 the petitioner got deposited the entire fee execution of the respondents herein
5. Record further reveals that an e-tenders has been again issued by the second respondent on 21.04.2022 for procurement of books of NCERT for the academic year 2022-2023 for class IXth to XIIth copy of the etender dated 21.04.2022 is at page no. 16 of the writ petition.
6. Relevant extract of the offending provision of e-tender notice dated 21.04.20
Judicial interference in the matter of tenders and contracts is limited and the court should exercise restraint in interfering with the administrative decision-making process.
District Collector is not empowered to consider the aspect of alteration of any route or alignment except to remove difficulties faced by the licensee. As a result of this, even the request of altern....
Judicial review of tender conditions is limited; courts should not interfere unless actions are arbitrary, discriminatory, or mala fide, ensuring public interest is prioritized.
The main legal point established in the judgment is the limited scope of judicial review in tender conditions, emphasizing the authority of the tendering entity to interpret and appreciate its requir....
Point of Law- Court in all the aforesaid decisions has cautioned time and again that courts should exercise a lot of restraint while exercising their powers of judicial review in contractual or comme....
Judicial review in tender matters is limited to preventing arbitrariness; courts should defer to the authority's interpretation of tender documents unless clear malafides or perversity are present.
The formulation of tender conditions falls within the administrative domain of the authority, and judicial review is limited to preventing arbitrariness or favoritism. The courts cannot interfere wit....
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