IN THE HIGH COURT OF JHARKHAND, RANCHI
L.P.A. No.114 of 2004
M/s Chamundeshwari Corporation through
its Proprietor Premi Arora .... Appellant
Versus
The State of Jharkhand and Others .... Respondents
CORAM: HON'BLE MR. JUSTICE NARENDRA NATH TIWARI
HON'BLE MR. JUSTICE PRADEEP KUMAR
For the Appellant : Mrs. Ritu Kumar, Advocate
Ravi Kr. Singh, Advocate
Niki Sinha, Advocate
Ratna Prabha, Advocate
For the State : J.C. to A.G.
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11/03.02.2009
The appellant was the successful bidder against the Notice
Inviting Tender (N.I.T.), issued by the Tribal Welfare Department,
State of Jharkhand, for supply of cloth materials as per the terms
of the tender.
2. As many as 13 persons took part in the tender. The Tender
Committee, after preparing a comparative chart, accepted the bid
of the appellant. The rate quoted by the appellant was 86.00 +
4.5% for Suitings and 44.44+4.5% for Shirting. In the final
comparative chart (Annexure-12) the composite rate was shown as
Rs. 89.87 and Rs. 46.44. The bids of the respondent No.4 and
other contenders were not accepted for the reasons noted in the
remarks column i.e. for want of I.S.O. certificate, quoting of non-
branded cloths on higher rates etc.
3. The writ petitioner-Respondent No.4 challenged the
allotment on the ground that the acceptance of the tender of the
appellant was in violation of the terms of the N.I.T. It was alleged
that in the Notice Inviting Tender, there was no provision for
separate cost for payment of transportation to the supplier but the
tender of the appellant was accepted with the stipulation of
payment of extra transportation/handling charges. The writ
petition was contested by the appellant as also by the State.
4. Learned Single Judge, after hearing the parties disposed of
the writ petition holding, inter alia, that Writ Petitioner-Respondent
No.4 was rightly found disqualified by the Tender Committee on
three grounds i.e. (i) it did not furnish I.S.O. certificate, (ii)
composition of Polyester and Viscose offered for supply was not as
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per the specification and (iii) the petitioner had quoted two
different rates.
5. Learned Single Judge, while refusing relief to the writ
petitioner, however, intervened in the decision of the Tender
Committee on the rate quoted by the petitioner. According to the
learned Single Judge, the rate quoted by the appellant and
accepted by the Tender Committee included the transportation and
handling charges which were contrary to the terms of the notice.
Learned Single Judge directed the concerned respondents not to
pay 4.5% extra amount in future and to recover/adjust that
amount, if already paid.
6. The appellant is aggrieved by only that part of the order of
the learned Single Judge whereby he has directed the respondent
not to pay 4.5% of the amount in future and to recover/adjust that
amount if already paid.
7. Mrs. Ritu Kumar, learned counsel appearing on behalf of the
appellant submitted that learned court below while accepting the
decision of the Tender Committee has erroneously interfered with
the rate quoted by the appellant. She further submitted that the
Tender Committee is especially constituted for taking decisions and
in its discretion, to decide the rate and the court cannot substitute
the decisions of the Tender Committee. It has been submitted that
the decisions of the Tender Committee is based on various
considerations and without properly considering the situation under
which the decision has been taken by the Tender Committee,
learned single judge has erroneously interfered with the decision of
the said committee. The decision making process of the Tender
Committee cannot be interfered with by the court without arriving
at the finding that it is necessary to do so in the public interest.
Learned Single Judge on the one hand has found the decision of
tender committee allotting the tender to the appellant and rejecting
the offer of the writ petitioner as valid and on the other hand has
erroneously interfered with the decision regarding the rate quoted
by the petitioner. He, however, has not found any malafide or
involvement of any public interest warranting such interference.
8. Learned counsel referred to and relied upon a decision of
the Supreme Court in the case of Raunaq International Ltd Vrs.
I.V.R. Construction Ltd. and others (reported in AIR 1999
Supreme Court 393) and submitted that unless the court is
satisfied that there is involvement of substantial amount of public
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interest, or that the transaction of the process was tainted with
malafide, the court should not intervene in the disputes between
two rival tenderers in exercise of its power under Article 226 of the
Constitution.
9. It has been submitted that learned Single Judge having held
that the decision of the Tender Committee regarding acceptance of
offer of the appellant was not tainted with any illegality or malafide,
review of the decision regarding acceptance of rate as quoted by
the appellant is wholly unwarranted and unjustified and the same is
contrary to the decision of the Supreme Court in Raunaq
International Ltd. (Supra).
10. Learned counsel appearing on behalf of the State supported
the decision of the Tender Committee and contentions of the
appellant. The writ petitioner- Respondent No.4 has also not
contested this appeal.
11. Learned counsel appearing on behalf of the writ petitioner-
Respondent No.4 submitted that in the writ petition he had
challenged the decision of the Tender Committee allotting the work
in favour of the appellant. The writ petitioner has not challenged
the said decision of the Learned Single Judge whereby he had
dismissed his writ petition. The writ petitioner is no longer
interested in contesting the appeal.
12. We have heard learned counsel for the parties and
considered the submissions made by them. We find force in the
submissions and points taken by the appellant. The Apex Court
has given a clear guideline regarding interference of the court in
tender matters in exercise of its jurisdiction under Article 226 of the
Constitution. The Hon’ble Supreme Court in the case of Tata
Cellular Vs. Union of India [reported in (1994) 6 SCC 651]
taking notice of number of earlier decisions held that the court in
exercise of writ jurisdiction can enter into the judicial review of the
contractual process and decision of the government bodies only in
order to prevent arbitrariness and favouritism, subject to
limitations, which may be precisely summed up as follows:-
(i) The court does not sit as a court of appeal but merely
reviews the manner in which the decision was made.
(ii) The Court does not have the expertise to correct the
administrative decisions. If a review of the
administrative decision is permitted, it will be
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substituting its own decision without the necessary
expertise which itself may be fallible.
(iii) The government must have freedom of contract. In
other words, a fair play in the joints is a necessary
concomitant for an administrative body functioning in
an administrative sphere or quasi-administrative
sphere, subject to the test by applying the
“Wednesbury Principle of Reasonableness” of the
decision that does not admit arbitrariness, bias or
malafide.
13. Almost the same view has been taken by the Apex Court in
the case of Asia Foundation and Construction Ltd. Vs.
Trafalgar House Construction Pvt. Ltd. [reported in (1997)
1 SCC 738].
14. The Supreme Court after elaborate discussion, has
concluded that in absence of overwhelming public interest or
allegation of malafide or collateral reasons for granting the contract
the court should not interfere with the decision of the Tender
Committee in exercise of its jurisdiction under Article 226 of the
Constitution.
15. In our opinion, learned Single Judge while accepting the
process of the tender has committed an error in interfering with the
rate accepted by the Tender Committee. There is no finding of
learned Single Judge that the said part of the decision of Tender
Committee is tainted with malafide or collateral reasons or the
decision is against the public interest. In absence of such elements
it was not proper for learned Single Judge to substitute its own
decision regarding the rate decided by the expert committee. That
part of the impugned order by which the rate has been modified
and the concerned authorities are directed to stop payment of part
of the rate and adjust or realize the amount already paid to the
appellant is not sound and sustainable.
16. We set aside that part of the order of the learned Single
Judge and allow this appeal.
17. However, there is no order as to cost.
(Narendra Nath Tiwari,J.)
(Pradeep Kumar,J.)
Shamim/