S.B.Civil Misc. Appeal No.696/2008
The State of Raj. through Addl. Chief Engineer
vs. M/s Ramchandra Kumawat & Co.and anr.
and another connected appeal
1.
IN THE HIGH COURT OF JUDICATUARE FOR RAJASTHAN AT
JODHPUR.
JUDGMENT
(1) S.B. Civil Misc. Appeal No. 696/2008
The State of Raj., vs M/s Ramchandra
through Addl. Chief Kumawat & Co.
Engineer, & ors. & another.
(2) S.B. Civil Misc. Appeal No. 611/2008
Krishan Vallab vs. M/s Ramchandra
Kumawat & Co. And
others.
under Order 43 Rule 1(r), CPC against the
order dated 3.5.2008 passed by the Addl.
District & Sessions Judge No.3, Udipuar in Misc.
Case No.14/2008.
Date of Judgment: September 29th, 2008.
PRESENT
HON'BLE MR. PRAKASH TATIA, J.
Mr. Rameshwar Dave, Dy.G.A. for the State in Appeal
Nos.696/08b & 611/08.
Mr. Ravi Bhansali for the appellant in Appeal No.611/08 and
for respondent no. 2 in Appeal No.696/08
Mr. Rajesh Joshi for the respondent no.1 in both the appeals.
S.B.Civil Misc. Appeal No.696/2008
The State of Raj. through Addl. Chief Engineer
vs. M/s Ramchandra Kumawat & Co.and anr.
and another connected appeal
2.
BY THE COURT:
These two appeals have been preferred to challenge the
order dated 3.5.2008 passed by the court of Addl. District Judge
No.3, Udaipur in Civil Misc. Case NO.14/08 by which the trial court
granted injunction order against giving work to the appellant
Krishna Kumar. The Works in question are in relation to work out of
package for which notices inviting tenders NO. 28 /PMGSY/2007-
2008 was issued on 4.2.2007.
According to the plaintiff, he was competitive bidder for the
work in question and as the officers of the respondent had grudge
against the plaintiff-respondent, therefore, with malafide
intention and to blame respondent-plaintiff, the tender of the
appellant-defendant no.4 was accepted even when the appellant-
defendant’s tender was liable for rejection because of the reason
that the tender documents were incomplete as the requisite price
for the five years maintenance of the work was not mentioned by
the defendant-appellant in the tender documents and some of the
pages of tender document were not signed by him and further the
offer was non-responsive.
S.B.Civil Misc. Appeal No.696/2008
The State of Raj. through Addl. Chief Engineer
vs. M/s Ramchandra Kumawat & Co.and anr.
and another connected appeal
3.
The trial court after considering Conditions No.25.1, 25.2,
25.3 as well as clause 8.3, held that the tender document of the
appellant-defendant no.4 was incomplete, as he did not give any
rates for the five years maintenance and did not sign that part of
the document and, therefore, the tender document was non-
responsive and since it has not been signed, therefore, it was liable
to be rejected as per clause 25.1, 25.2 and 25.3 of the conditions
of the tender. The trial court rejected the contention of the State
as well as the rival contractor that if any amount is not mentioned
in the document for any work, then that work cost is required to
be treated included in the rates mentioned by the contractor for
whole of the work. The learned trial court also was of the view
that contention of the defendant-appellant that main work in the
contract was construction of the roads and was not its
maintenance, also cannot be accepted. The plaintiff in addition to
relief of prohibitory injunction against the respondent, sought
mandatory injunction in its favour for grant of work order in his
favour. However, the trial court was of the view that no case is
made out by the plaintiff-respondent no.1 for issuing work order in
his favour by interim order. In view of the above reasons, the trial
S.B.Civil Misc. Appeal No.696/2008
The State of Raj. through Addl. Chief Engineer
vs. M/s Ramchandra Kumawat & Co.and anr.
and another connected appeal
4.
court granted the only prohibitory injunction in favour of
respondent-plaintiff and refused mandatory injunction to the
plaintiff.
The defendant-contractor has preferred Appeal no.611/08,
whereas the State has preferred Appeal no. 696/08 to challenge
the said order dated 3.5.2008.
According to the learned counsel for the appellant-
contractor, the appellant contractor submitted his bid knowing it
well that as per Condition No.39.3, the contractor can submit his
price for whole of the contract work by giving bids so as to cover
maintenance cost for roads for five years after completion of
construction of roads in the main work cost and which the
appellant-defendant contractor did in present transaction. The
Condition No.39.3 clearly provides that items of the works for
which no rate or price has been entered in the Bills of Quantities,
will not be paid for by the Employer and shall be deemed covered
by other rates and prices in the contract. To make this position
clear, the appellant-contractor submitted before the authorities in
writing also. As per clause 32.1, the performance security taken
from the contractor, which says that successful bidder/contractor
S.B.Civil Misc. Appeal No.696/2008
The State of Raj. through Addl. Chief Engineer
vs. M/s Ramchandra Kumawat & Co.and anr.
and another connected appeal
5.
shall provide to the contractor total performance security of five
percent of the contact price, for a period of five years and the
time of completion of construction work plus additional security
for unbalanced bids in accordance with clause 27.3 and 27.4 of ITB
and clause 46 Part-I General condition of contract. It is also
submitted by the learned counsel for the appellants that the
principal work is of construction of roads and maintenance for five
years is ancillary work. The trial court failed to appreciate the
distinction between two works. It is submitted that two works may
have been the part of the same contract, but at the same time,
the nature of the work cannot be ignored. The major work under
the contract is construction of roads.
The learned counsel for the appellant-State vehemently
submitted that the appellant himself got the contract for other
works from the appellant-State under the same/similar
advertisement inviting tenders by submitting tender form with
some pages without signatures of the plaintiff-respondent and yet
has challenged the act of the respondent when the bid was not
came in favour of the respondent-plaintiff. It is also submitted that
absolutely false and baseless allegations of malafide have been
S.B.Civil Misc. Appeal No.696/2008
The State of Raj. through Addl. Chief Engineer
vs. M/s Ramchandra Kumawat & Co.and anr.
and another connected appeal
6.
levelled by the plaintiff against the officers of the appellant-State
and that too without impleading any of the officers as party in the
suit and in the petition for grant of injunction. It is also submitted
that in a matter of mere breach of contract, adequate relief can
be obtained by filing a suit for damages and the plaintiff cannot
get the contract in his favour in present suit. Therefore, no
injunction could have been granted by the trial court. It is also
submitted that in a matter of public importance affecting the
public at large, the courts are expected to slow in granting
injunction so as to put a complete halt over the work for public
benefit. The learned counsel for the appellant relied upon several
judgments of the Hon’ble Supreme Court in support of his
contention.
The learned counsel for the respondents vehemently
submitted that this fact is not in dispute that some of the pages of
the tender document have not been signed by the appellant-
contractor and signing of the document and each page of the
document only can make the tender document a valid document of
tender. In case the documents are not signed or any of the
requirement is unfilled, then the tender document cannot be
S.B.Civil Misc. Appeal No.696/2008
The State of Raj. through Addl. Chief Engineer
vs. M/s Ramchandra Kumawat & Co.and anr.
and another connected appeal
7.
considered and required to be rejected. Clause 8.3 clearly provides
that the bidder is expected to examine carefully all instructions
and conditions of contract and in case bid is not substantially
responsive to the requirements of the bid documents then on this
ground alone, the document is required to be rejected. Clause
18.2. further provides that all pages of bid document shall be
signed by the persons or person signing the bid. Clause 25.1 also
specifically provides that during detailed evaluation of technical
bids, it will be looked into that the bid has been properly signed
and is responsive to the requirement of bidding document. What is
substantially responsive, has been explained under Condition
NO.25.2 and it prohibits the rectification of bid in any manner.
Clause 25.3 is specific provision for rejection of financial bid, if it
is not substantially responsive and also provides that a bid which is
not substantially responsive, may not be subsequently be made
responsive by correction or withdrawn of the nonconforming
deviation or reservation.
The learned counsel for the respondent-plaintiff relief upon
the judgment of the Delhi High Court delivered in the case of P.K.
Delicacies Pvt. Ltd. vs. Union of India (2005(2) CTLJ 134 (Delhi)
S.B.Civil Misc. Appeal No.696/2008
The State of Raj. through Addl. Chief Engineer
vs. M/s Ramchandra Kumawat & Co.and anr.
and another connected appeal
8.
wherein the annexed document was not filled up and signed then
the Division Bench of the Delhi High Court held that it is an
important part of tender bid and was required to be filled up and
signed by the person giving the bid. The Division Bench of the Delhi
High Court held that the failure to fill up the said document,
cannot be a technical irregularity of little or no significance and,
thereafter, it has been held that as a general rule, tender
conditions has to be strictly adhered to and the authorities
concerned have power to reject and not to consider the tender
which is incomplete and lacking any particulars.
The learned counsel for the respondent-plaintiff further
relied upon the judgment of the Gauhati High Court delivered in
the case of R.N. Ghosh vs. State of Tripura and others ( 2000(3)
Arb.LR 64 (Gauhati), wherein there was condition that the bidder
shall put his full signature on every page of rate schedule. In that
case the bidder put his initials only in place of full signatures and
that was found non-compliance of the requirement by the Gauhati
High Court. It is also submitted that in some cases where the rates
were required to be given in figure as well as in words and have
not been given so, has been considered as non-compliance of the
S.B.Civil Misc. Appeal No.696/2008
The State of Raj. through Addl. Chief Engineer
vs. M/s Ramchandra Kumawat & Co.and anr.
and another connected appeal
9.
conditions of the tender.
The learned counsel for the respondents also relied upon
judgment of the Hon’ble Apex Court delivered in the case of W.B.
State Electricity Board vs. Patel Engineering Co. Ltd. and others
( (2001) 2 SCC 451), wherein Hon’ble the Apex Court held that the
principle of awarding contract to lowest tenderer applies when all
things are equal and there is no obligation to award contract to
lowest bidder and in this case, according to the learned counsel for
the respondent, the respondent is prepared to do the work on the
rates given by the defendant-appellant-contractor and, therefore,
there cannot arise any question of loss to the State or public.
The learned counsel for the respondent-plaintiff vehemently
submitted that no plea was taken by the State or the appellant-
contractor that the plaintiff-respondent-contractor himself
submitted tender document with some blank pages or without
signing of the pages. This pleas has been taken for the first time in
argument before this Court, which cannot be entertained.
I considered the submissions of the learned counsel for the
parties and perused the facts of the case.
There cannot be any doubt that in the matter of award of
S.B.Civil Misc. Appeal No.696/2008
The State of Raj. through Addl. Chief Engineer
vs. M/s Ramchandra Kumawat & Co.and anr.
and another connected appeal
10.
the contract for public work by the Government agencies, the
Government agencies cannot act arbitrarily. The Government
agencies are required to see the compliance of all the conditions
which can certainly prevent the favoritism and avoid harm because
of the bias as well as to prevent corruption in the matter of
awarding work contact of huge amount to the contractor. It is also
true that mere offer of low price cannot be ground for grant of
award of contract and the contractor is required to full fill all
other eligibility criteria. Which condition is essential condition of
the contract, depends upon the facts of each case. In a case where
short signatures were put in place of full signatures of the bidder,
the court held that it is non-compliance of the requirement for
giving offer but that cannot be applied as a rule in all contracts. In
the case of R.N. Ghosh (supra), there was specific requirement of
signing the document with full signatures and in the facts of the
case, the court held that the initial or short signatures of the
bidder was violation of the condition. As stated above, this
proposition cannot be accepted as rule of general law in each and
every case. Here in this case, the alleged violations are that the
defendant-appellant-contractor did not mention the rates for
S.B.Civil Misc. Appeal No.696/2008
The State of Raj. through Addl. Chief Engineer
vs. M/s Ramchandra Kumawat & Co.and anr.
and another connected appeal
11.
maintaining the roads for five years after completion of roads. If it
is looked into without noticing the complete contract and the
conditions applicable for the contract, then it is a serious matter.
If the bid could have been rejected only on this ground, then there
was no reason for providing Condition No.39.3, which specifically
provides that in case no rate or price has been entered in the bills
of quantities for the works, no amount will be paid by the
employer to the contractor for said unquoted price and it shall be
deemed that the rates and prices are already covered by other
rates and prices given in the contract. The appellant-contractor
submitted in writing to the defendants, the government agencies
that his bid includes the maintenance price for the roads, is not
any addition, alteration or variation in the offer of defendant-
appellant so as to hit by clause 25.3. Clause 25.3 only provides that
if a bid is not substantially responsive, it cannot be made
responsive, subsequently by (a) correction or (b) withdrawal of the
nonconforming deviation or (c) reservation. The correction,
withdrawal, deviation and reservation cannot be equated with
making the position clear only by pointing out towards the real
facts and meaning of the offer. The documents, therefore, was
S.B.Civil Misc. Appeal No.696/2008
The State of Raj. through Addl. Chief Engineer
vs. M/s Ramchandra Kumawat & Co.and anr.
and another connected appeal
12.
inclusive of the cost or rates for maintenance of the roads for five
years.
If there can be unfilled column for cost of work and the cost
of that work stands included in the price given for other items in
the tender document and the contractor is not claiming any
benefit out of that part of the contract and, therefore, has not
signed the said page of the contract, it cannot materially affect
the document so as to say that the tender document was not
“substantially responsive” or was incomplete.
In view of the above reason, the trial court failed to
appreciate the facts of the case properly and committed error of
law in interpreting the clauses of the conditions of the tender
document and the relevant conditions. In the case of B.S.N. Joshi
& Sons Ltd. vs. Nair Coal Services Ltd. & ors. ( (1006) 11 SCC 548),
the Hon’ble Court considered issue of essential conditions and
substantial compliance with essential condition in the matter of
government contracts and also made it clear what is aims and
object of the tender conditions. Hon’ble the Apex Court held that
the tender conditions may have to be construed differently having
regard to the facts situation obtaining in each case and no hard
S.B.Civil Misc. Appeal No.696/2008
The State of Raj. through Addl. Chief Engineer
vs. M/s Ramchandra Kumawat & Co.and anr.
and another connected appeal
13.
and fast rule can be laid down therefor. Hon’ble the Apex Court
held that when a decision is taken by the appropriate authority
upon due consideration of the tender document submitted by all
the tenderer on their own risk and if it is ultimately found that
successful bidders had in fact substantially complied with the
purport and object for which essential conditions were laid down,
the same may not ordinarily be interfered with by the court.
In view of the above reason, there appears to be no prima
facie case in favour of the plaintiff-respondent.
If we look into the question of irreparable injury, then in
government contract of the nature which is involved in this case,
there is commercial interest of the contract but, at the same time,
the beneficiaries of the work is the public. There may be very
many reasons for challenge to giving of the contract to one of the
parties and one of the important aspect may also be that the
corruption which is required to be curbed by the courts, when the
facts are brought to the notice of the court. Here in this case, the
plaintiff even after alleging the malafide and favoritism, could not
substantiate his plea and, therefore, it appears that the plaintiff
is seeking stay against the public work only on the basis of mere
S.B.Civil Misc. Appeal No.696/2008
The State of Raj. through Addl. Chief Engineer
vs. M/s Ramchandra Kumawat & Co.and anr.
and another connected appeal
14.
technical objections which may cause greater hardship to the
public at large and loss to the State exchequer also. In contrast,
the plaintiff is not likely to suffer such irreparable injury which can
be compensated by money.
In view of the above reason, there appears to be no balance
of convenience in favour of the plaintiff.
Hence the appeals of the appellants are allowed. The
injunction order granted by the trial court dated 3.5.2008 is set
aside. The injunction application of the plaintiff is dismissed. No
order as to costs.
(PAKASH TATIA),J.
mlt