IN THE COURT OF APPEAL OF THE DEMOCRATIC SOCIALIST REPUBLIC OF SRI LANKA In the matter of an Application for mandates in the nature of Writs of Certiorari and Mandamus under and in terms of Article 140 of the Constitution of the Democratic Socialist Republic of Sri Lanka.

1. GRAPHIC SYSTEMS (PVT) LIMITED, No. 835, Kotte Road, Etul Kotte.

CA (Writ) Application No:

525/2019

2. KEERTHI GUNAWARDANE, Managing Director, Graphic Systems (Pvt) Limited, No. 835, Kotte Road, Etul Kotte.

PETITIONERS Vs.

1. PEOPLE'S BANK, No. 75, Sir Chittampalam A.Gardiner Mawatha, Colombo 02.

2. R. GUNAWARDANE, CEO/General Manager, People's Bank, No.30/101, Kew Road, Colombo 12.

3. S. GUNARATNE, Chief Manager, Supplies Division, People's Bank, No. 30/101, Kew Road, Colombo 12.

4. M.T. S. N. SAMARASEKARA, Senior Manager, Supplies Division, People's Bank, No3010l, Kew Road, Colombo 12.

5. NISSANKA NANAYAKKARA, Chairman, People's Bank, No 30/101, Kew Road, Colombo 12.

1^st – 5^th RESPONDENTS SUJEEWA RAJAPAKSE, Chairman, People's Bank, No.30/101, Kew Road, Colombo 12.

SUBSTITUTED 5^th RESPONDENT Before: M. T. Mohammed Laffar, J.

S. U. B. Karalliyadde, J.

Counsel:

Sanjeewa Jayawardene, PC with Rukshan Senadeera, instructed by Paul Rathnayeke Associates for the Petitioners.

Kawshalya Nawaratne with Ms. Nadeeshani Gunawardena, instructed by Ms.

Chandima Induwara for the 1^st - 5^th Respondents.

Written submissions tendered on:

01.07.2022 and 12.12.2022 by the Petitioner.

27.01.2022 by the Respondent.

Argued on: 18.10.2022 and 02.11.2022.

Decided on: 27.03.2024. S.U.B. Karalliyadde, J.

The 1^st Petitioner to this Writ Application is a duly incorporated Company registered under the Companies Act, No. 17 of 1982 and the 2^nd Petitioner is the Managing Director of the 1^st Petitioner Company. A tender was called by the People’s Bank (the 1^st Respondent Bank) on 09.03.2019 (marked as P12), inviting suppliers who are capable of printing and supplying appropriate quality materials for 250,000 units of Cash Deposit Slips, within the stipulated time period mentioned in the tender notice. The Petitioner Company submitted its bid for the said tender by letter dated 26.03.2019 for a sum of Rs. 18,487,500.00/-. The 2^nd and the 3^rd Respondents of the 1^st Respondent Bank informed the Petitioner Company that its tender bid had been rejected. On 19.07.2019 by the letter marked as P15, the Petitioner Company submitted a written request inquiring the grounds upon which its tender was rejected. The 1^st Respondent Bank by P16 replied emphasizing Clause 17 of the Tender Notice marked as P12 which states as follows;

“The Bank reserves to itself the right without question to reject any or all tenders and the right to accept any portion of a tender without assigning reasons and the Bank will not entertain correspondence from suppliers for acceptance or non-acceptance of offers and the Bank is not bound to accept the lowest bid.”

The Petitioner argues that the 1^st Respondent Bank having the right to reject any bid “without question”, and to do so, “without assigning reasons” thereto as per Clause 17 is completely obnoxious to any sense of reasonableness and justice, especially in the context of public procurement and, no public body should be permitted to rely on such a patently illegal and unreasonable clause.

By the letter dated 21.08.2019 (marked as P18), the 4^th Respondent of the 1^st Respondent Bank informed the Attorney at Law of the Petitioner that the acceptance or rejection of the tender depends solely on the discretion of the Bank. The Petitioner alleges that the 1^st Respondent Bank is seeking refuge under Clause 17 of the tender document which contradicts the principles of vires, equity, fairness, rationality, and natural justice under the Public Procurement Guidelines of 2006. The learned President’s Counsel appearing for the Petitioners argue that every bidder whose bid is rejected, ought to be made aware of the reason for rejection for the following reasons;

a. Natural justice demands that a decision-make