A supplier's contractual obligations are enforceable; failure to comply can lead to liability for resultant losses

JUDGMENT

[W.P.(C) No. 19299 of 2023 & R.P.No.476 of 2024 in I.A.No. 1 of 2021in DBAR 5 OF 2015]

Raja Vijayaraghavan V, J.

W.P.(C) No.19299 of 2023 has been filed seeking to quash Exts.P18 and P19 orders issued by the Travancore Devaswom Board, by which the petitioner has been called upon to pay a sum of ₹20,41,279/- together with interest at the rate of 18% per annum towards the loss said to have been sustained by the Devaswom Board. The petitioner has also sought a declaration that he is not liable to account for or reimburse the alleged loss claimed by the Board in connection with the supply of Easy Open Lids pursuant to Ext. P1 tender.

2. Review Petition No. 476 of 2024 has also been filed by the petitioner seeking review of the order passed by a Division Bench of this Court in DBAR No.5 of 2015, wherein this Court proceeded to exonerate one Sri. P. Purandara Babu, Director of M/s. Mira Aditi Impex Pvt. Ltd., from any liability to the Board.

3. In order to properly appreciate the rival contentions raised in these proceedings, it is necessary to briefly refer to the relevant facts and circumstances that culminated in the issuance of the impugned orders.

4. The petitioner states that he is the proprietor of M/s. Binu and Company, a concern engaged in the distribution and supply of various items. A tender dated 08.08.2014 was issued by the Travancore Devaswom Board inviting bids for the supply of 1.5 crores of Easy Open Lids. The lids were required for use at the Sabarimala Temple for packing Aravana, the prasadam prepared and distributed to devotees during the Mandalam season of 2014–15. The notice inviting tender dated 08.08.2014, produced as Ext.P1, indicates that the successful bidder was required to supply 50% of the total quantity on or before 15.10.2014 and the remaining quantity on or before 30.11.2014. This timeline was stipulated keeping in view the commencement of the Mandalam–Makaravilakku season, which ordinarily begins around 15.11.2014 and continues until the third week of January.

5. The petitioner submitted his bid pursuant to the said tender notification and was eventually adjudged the lowest tenderer (L1). Ext.P2 would show that he was thereafter called for a negotiation meeting scheduled on 24.09.2014. According to the petitioner, during the course of the said negotiation, the quoted rate for the Easy Open Lids was further reduced and finalised at ₹2.35 per lid.

6. In the meantime, Sri. Purandara Babu, the proprietor of M/s. Mira Aditi Impex Pvt. Ltd., approached this Court by filing W.P.(C) No.29780 of 2014 challenging the award of the tender. The said Writ Petition was instituted on 09.11.2014, and the present petitioner was arrayed as the 3rd respondent therein.

7. According to Sri. Purandara Babu, the petitioner, Sri. S.S. Binu did not satisfy the pre-qualification requirements stipulated in the tender conditions. It was contended that, instead of rejecting the petitioner’s bid on that ground, the Devaswom Board had proceeded to negotiate with him and ultimately treated him as the successful bidder.

8. The Writ Petition came up for consideration before a learned Single Judge on 12.11.2014. The learned Single Judge stayed all further proceedings and posted the matter to 14.11.2014.

9. On 14.11.2014, the learned Single Judge passed the following order:

7. It is submitted that the entire requirement of an Easy Open Lid is around ₹1 Crore. Considering the commencement of Sabarimala season on 17.11.2014, in order to resolve the dispute, pleadings are necessary. Therefore the 3rd respondent is permitted to supply 50 lakhs of Easy Open Lids. The consideration of other supply will be based on the further orders of this Court. This Order will not confer a right on the 3rd respondent t