JUDGMENT
Madan B. Lokur, J.
1. The Petitioner had bid for two contracts described as package No. EW-II(WB-6) and EW-II(WB-7). The relief prayed for in respect of the first contract was given up during the course of hearing while the relief with regard to the second contract, that is, EW-II (WB-7) was pressed by learned counsel.
2. The bid for the second contract EW-II (WB-7) related to four laning of km 526.00 to km 507.00 of NH-31 and Islampur Bypass (10.31 km) in the State of West Bengal. The estimated cost was Rs.225 crores.
3. Bids were invited for the project with the sale of bid documents from 31st January, 2005 up to 28th February, 2005.
4. On 28th February, 2005 a pre-bid meeting was attended by the prospective bidders for the purposes of any clarification that may be required. But it was decided that there is no requirement of issuing any addendum to any of the bid documents.
5. On 19th April, 2005 the financial bids were opened and according to the Respondent the three lowest bidders were as follows:-
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Name of the Contractor Final Bid Price (Rs.) ---------------------------------------------------------------------- M/s. Madhucon Projects Ltd. 2341466499 M/s. B. Seenaiah and Co. 2341519314 M/s. Progressive Construction Ltd. 2508279487 -----------------------------------------------------------------------
6. It is stated by the Petitioners that the bid of the lowest bidder, that is, M/s Madhucon Project Ltd. was found to be non-responsive with the result that it was rejected. Since the bid of the Petitioners then become the lowest bid, the contract should have been awarded to the Petitioners. It is stated that to the surprise of the Petitioners the Respondent decided to re-invite bids for the same project, without any valid justification and this is what led to the Petitioners being compelled to file a writ petition in this Court praying for quashing and setting aside the notice inviting fresh tenders and for awarding the contract to the Petitioners.
7. The Respondent filed a counter affidavit dated 5th September, 2005 in which it was stated that the Evaluation Committee had evaluated the technical and financial bids and based on arithmetical calculations, the final bid price for L-1, L-2 and L-3 was as mentioned above. Based on this averment, it was submitted by learned counsel for the Petitioners that since his clients were originally L-2 (after the bid of M/s Madhucon Projects Ltd. was declared non-responsive) the Petitioners admittedly became L-1 and so were entitled to the contract.
8. Since there seemed to be some lack of clarity in what actually happened in the decision making process, the Respondent was directed to produce the record and inspection thereof was given to the learned counsel for the Petitioners. The Respondent also filed an additional affidavit dated 9th September, 2005 in which it annexed some relevant documents with regard to the decision making process. We then heard learned counsel for the parties and also went through the documents produced before us.
9. The controversy arises out of some uncertainty in the interpretation of one of the items in the contract in the bid documents, that is, item No. 6.22 (d) in the bill of quantities.
This reads as follows:-
Item No. Description Unit Estimated quantity Unit Rate (Rs.) In figure In words Amount (Rs.)
6.22
Supplying and fixing of POT PTFE bearings complete as per drawings and IRC:83 (Part III)-2002
no.
0
a) xxx xxx xxx
b) xxx xxx xxx
c) xxx xxx xxx
d) Free Sliding Pot cum PTFE
Capacity 1750 kN
Capacity 2442 kN
no.
no.
21350
0
10. The bid of the Petitioners in respect of this quantity was Re.1/- per unit. In other words the Petitioners had agreed to supply item 6.22(d) at a total price of Rs.21350/-.
11. The record shows that the Evaluation Committee held a meeting on 26th April, 2005. That meeting was the first one when the bids were considered. It was noted that one of the bidders had quoted the amount against item No. 6.22 (d) in tonnes instead of unit numbers and that, therefore, this required an analysis of the bids. The relevant paragraph of the Minutes of the meeting reads as follows:-
“Thereafter the committee deliberated the lowest quoted bid prices of all packages but found that due to rates of bearing (BOQ item 6.22d) quoted in tones instead for each number by the lowest announced bidder i.e. M/s Madhucon for package EW-II(WB-7).
The committee decided to analysis the lowest bidder for EW-II(WB-7) in subsequent meeting”.
12. The Evaluation Committee met again on 4th May, 2005 and it was noted that because of the quotation given in tonnes by M/s Madhucon, it was difficult to assess correctly the lowest bid of the package EW-II(WB-7). It was, therefore, suggested that legal opinion may be taken on the implication of the change from unit number to tonnes. The Minutes of their meeting recorded on 4th May, 2005 read as follows:-
“3. The Convener welcomed the Committee Members. Thereafter committee deliberated the quoted bid prices of EW-II (WB-7) civil package and found that due to rates of bearing (BOQ item 6.22d) quoted in tones instead for each number as given in BOQ by the lowest announced bider i.e. M/s Madhucon, it is difficult to assess correctly the lowest bid of the package. So, the committee recommended to take the legal opinion regarding the implication of change of unit of bearing (item No. 6.22d) from No. to tone before taking any further decision in the matter.”
13. Thereafter the matter was referred to the solicitors of the Respondent for an opinion. On receipt of the opinion a meeting of the Evaluation Committee was held on 27th June, 2005 in which it was decided that the bid of M/s Madhucon Projects Ltd. was non-responsive and it was also decided to recommend the calling of fresh bids, being the best available option. The relevant extract of the Minutes of the meeting of the Evaluation Committee held on 27th June, 2005 is as follows:-
“3. The Convenor welcomed the Committee Members and informed the Committee that in pursuance of the decision taken during the meeting of 4th May, 2005, and after obtaining due approval of the competent authority, legal opinion was sought from M/s. M.V. Kini and Company. M/s. M.V. Kini and Company, after going through the bid document and the bids received, have observed:
(i) More than one bidder have committed the mistake of quoting the rate against item No. 6.22d in terms of weight and not in Nos. which indicates that the unit mentioned in the bid document is capable of being misunderstood in more than one way.
(ii) Against item No. 6.22d, bidders have quoted prices ranging from Rs.1/- per piece to Rs.40,000/- per piece.
(iii) Any interpolation or amendment to Bill of Quantities by the bidder amounts to non-compliance of the provisions of the bid conditions and as such, the bid of M/s. Madhucon Projects Ltd., the lower bidder, is to be regarded as non-responsive.
4. The Committee carefully considered the legal opinion given by M/s. M.V. Kini and Company, after detailed discussions and after declaring the L-1 bidder as non-responsive, the Committee recommends to call the bids afresh, which is the best available option. ”
14. It is stated on affidavit by the Respondent that the recommendations of the Evaluation Committee were approved by the Member (Technical) of the Respondent on 29th June, 2005, by the Chairman of the Respondent on 30th June, 2005.
15. Soon thereafter, the Respondent received representations from the Petitioners and it was decided to look into the matter afresh.
16. Accordingly on 10th August, 2005 a meeting of as many as 6 officers of the Respondent was called and the issues were reconsidered in the light of the opinion given by the solicitors of the Respondent as well as the representations made by the Petitioners. The Minutes of the meeting held on 10th August, 2005 are rather lengthy but the result of the discussion was that the better option was to re-invite tenders in respect of the package EW-II (WB-7) so that all bidders get an equal opportunity to offer their bids. The decision taken by the Committee reads as follows:-
“After discussing the matter at length, it was agreed that in case of package EW-II (WB-6), after issue of LOA, the bidding process has come to an end and the bidding process cannot be re-opened even after withdrawal of LOA. As regards package EW-II (B-7), since there is a substantial variation in the actual requirement of bearings vis-a-vis the quantity indicated in the BOQ item No. 6.22 (d), the better option is to re-invite the tenders, so that all the bidders get equal opportunity to offer their bids. It is accordingly, decided that notice for re-inviting tenders for packages EW-II (WB-6) and EW-II (WB-7) be issued, giving 4 weeks notice.”
17. It is on the basis of the above decision that the Respondent decided to call for fresh bids in respect of package EW-II(WB-7).
18. Learned counsel for the Petitioners raised two contentions. It was firstly contended that in terms of Clause 33 and 34 of the tender documents the bid of the Petitioners should have been automatically accepted when it was decided that the bid of M/s Madhucon Projects Ltd. was non-responsive. It was then submitted that the value of the item No. 6.22 (d) was so small and insignificant compared to the over all project that there was no reason to invite fresh bids.
19. We are of the view that both these contentions are not tenable. What we have to see essentially, is whether the decision making process was flawed and, if so, what would be the appropriate order to make. In case the decision making process is not flawed; obviously the writ petition would have to be dismissed.
20. In so far as the first contention is concerned, a bare reading of Clause 33 and 34 of the tender documents would show that the contention of learned counsel for the Petitioners is misconceived. These Clauses reads as follows:-
“33. Award
33.1 Subject to Clause 34, the Employer will award the Contract to the bidder whose bid has been determined to be substantially responsive to the bidding documents and who has offered the lowest Evaluated Bid Price pursuant to Clause 30, provided that such bidder has been determined to be (i) eligible in accordance with the provisions of Clause 3; and (ii) qualified in accordance with the provisions of Clause 5.
34. Employer’s Right to Accept any Bid and Reject and or all Bids.
34.1 Notwithstanding Clause 33, the Employer reserves the right to accept or reject any bid and to annul the bidding process and reject all bids, at any time prior to award of Contract, without thereby incurring any liability to the affected bidder or bidders or any obligation to inform the affected bidder or bidders of the grounds for the Employer’s action.”
21. While it is correct that Clause 33.1 requires that the contract should be awarded to the bidder whose bid is substantially responsive and who has offered the lowest bid price, it is subject to the provisions of Clause 34 of the tender documents, which gives the right to the Respondent to re-invite bids at any point of time prior to the award of the contract without incurring any liability and also to annul the bidding process. The Respondent had decided to annul the bidding process and to call for fresh bids, which was well within its power and authority. When this was put to learned counsel for the Petitioners, he very fairly did not press this contention any further.
22. In so far as the second contention is concerned, it is worthwhile to note that the Committee that met on 10th August, 2005 noted that the rates quoted against item No. 6.22 (d) varied from Rs.1/- per bearing to Rs.42,000/- per bearing and M/s Madhucon Projects Ltd. had actually quoted this item in tonnes as against unit numbers. It was brought to our notice by learned counsel for the Respondent that although the tender documents indicated that 21350 bearings were required, the actual requirement of the Respondent was only 72 bearings. In this context, the Committee noted that apart from the fact that there is a wide variation in rates, even taking the requirement to be in unit numbers, if a calculation is made on the basis of the actual requirement, that is, 72 bearings, a fresh evaluation of bids on the basis of the quoted rates would reflect quite a change in the bids. As a result, M/s Progressive Construction Ltd. who was originally L-3 as per the arithmetic calculation would become L-1, the Petitioners who were originally L-2 as per the arithmetic calculation would become L-3 and M/s Madhucon Projects Ltd. who was originally L-1 as per the arithmetic calculation would become L-2.
23. The Respondent has indicated in its counter affidavit that the change made by reducing the unit number from 21350 to 72 bearings would mean a huge change in the bids of the parties ranging from a high of Rs.67.5 crores to Rs.18.29 crores. The new chart would then read as follows:-
—————————————————————————————
S. No. Name of Bidder Final bid price as Final bid price as Difference in
per existing wrong per actual quantity of at end of
quantity of bearing bearing in 6.22d item execution
in 6.22d item (Rs. Crore) Rs. Lakhs)
(Rs. Crore)
---------------------------------------------------------------------------------------
1. Madhucon 234.14 (L1) 233.43 (L2) 70.50
2. B. Seenaiah 234.15 (L2) 234.15 (L3) 0.21
3. Progressive 250.83 (L3) 232.54 (L1) 1828.84
4. Maytas 308.58 (L5) 241.12 (L4) 6745.95
5. DRA 252.58 (L4) 252.31 (L5) 26.97
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24. Taking into consideration all these factors such as the wide variations in rates, the misunderstanding with regard to the question whether the bearings have to be supplied in terms of weight or unit number, the actual requirements of the Respondent and the change in the bids as a result of the actual requirements of the Respondent, it appears to have been decided that the best available option would be to invite fresh bids.
25. We do not find any irrationality or arbitrariness in the decision taken by the Respondent. They have taken all the relevant factors into consideration and they are experts in the field and having come to the conclusion that since there is such a huge variation, the best option would be to invite a fresh tender. The decision may not be to the liking of the Petitioners, and in so far as they are concerned, the change may be insignificant, but that hardly matters. It is the overall picture that has been considered by the Respondent and no fault can be found with that. In any case, going by the facts, whichever way one looks at the problem, the Petitioners would not become the lowest bidders except if one foists the Respondent with a huge quantity of ever 21,000 bearings worth crores of rupees, which they do not need.
26. We are loathe to substitute our opinion for that of the Respondent who has examined all aspects of the case and has taken a fair decision on the basis of the recommendation of the Evaluation Committee as well as another Committee that met on 10th August, 2005 which dispassionately considered the representations made by the Petitioners.
27. In view of the above, there is no merit in the writ petition. Dismissed.