{"id":258529,"date":"2009-10-16T00:00:00","date_gmt":"2009-10-15T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/acme-tele-power-limited-vs-union-of-india-on-16-october-2009"},"modified":"2015-07-25T11:14:37","modified_gmt":"2015-07-25T05:44:37","slug":"acme-tele-power-limited-vs-union-of-india-on-16-october-2009","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/acme-tele-power-limited-vs-union-of-india-on-16-october-2009","title":{"rendered":"Acme Tele Power Limited vs Union Of India on 16 October, 2009"},"content":{"rendered":"
Bombay High Court<\/div>\n
Acme Tele Power Limited vs Union Of India on 16 October, 2009<\/div>\n
Bench: A.M. Khanwilkar, Rajesh G. Ketkar<\/div>\n
                                        1\n\n                  IN THE HIGH COURT OF JUDICATURE AT BOMBAY\n                        ORDINARY ORIGINAL CIVIL  JURISDICTION\n\n\n\n\n                                                                              \n                     WRIT PETITION NO.1492 OF 2009\n\n\n\n\n                                                      \n                                WITH\n                  CHAMBER SUMMONS NO.296 OF 2009\n                                 IN\n\n\n\n\n                                                     \n                    WRIT PETITION NO.1492 OF 2009\n\n1. ACME Tele Power Limited\n    A Company incorporated and registered\n\n\n\n\n                                           \n    under the Companies Act<\/a>, 1956,\n    having its registered office at Plot No.2, Sector 34,\n                              \n    E.H.T.P.Gurgaon- 122 001 Haryana.\n\n2. Mr.Yogesh Sanklecha,\n                             \n    A Citizen of India and\n    a Shareholder of ACME Tele Power Ltd.\n    Residing at Plot No.68, Jedhenagar,\n            \n\n    Near Chntamani Hospital, \n    Divyawadi, Pune-32                                      .. Petitioners\n         \n\n\n\n           V\/s\n\n\n\n\n\n1. Union of India \n    Through its Secretary\n    Department of Telecommunications,\n    Ministry of Communications and\n    Information Technology, having its office at\n\n\n\n\n\n    Sanchar Bhawan, Ashoka Road,\n    New Delhi - 110 001.\n\n2. Bharat Sanchar Nigam Limited,\n    A Government of India Enterprise and\n    a company registered under\n\n\n\n\n                                                      ::: Downloaded on - 09\/06\/2013 15:14:13 :::\n                                          2\n\n    the Companies Act<\/a>, 1956\n    having its office of the Maharashtra Telecom\n    Circle at  \"D\" Wing, 6th Floor,\n\n\n\n\n                                                                                \n    BSNL Administrative Building,\n    Juhu Tara Road, Santacruz,\n\n\n\n\n                                                        \n    Mumbai 400 054.\n\n3. KEC International Limited,\n\n\n\n\n                                                       \n    A company registered under\n    the Companies Act<\/a>, 1956\n    having its registered office at\n    CEAT Mahal, 463, Dr.Annie Besant Road,\n\n\n\n\n                                            \n    Worli, Mumbai 400 030.\n\n4. GTL Limited,\n    A Company registered under \n                               \n    the Companies Act<\/a>, 1956,\n                              \n    having its registered office at\n    Global Vision, E.S.II, T.T.C.Industrial Area\n    Mahape, Navi Mumbai 401708                                ..  Respondents\n            \n\n\nMr.Rohit   Kapadia   with   Mr.Jimmy   Pochkhanwala,   Mr.Jayesh   Desai, \n         \n\n\n\nMr.Sandeep Narain and Ms.Amrita Thakore i\/by M\/s.Singhi & Co.for the \nPetitioners.\n\n\n\n\n\nMr.V.D.Shukla   with   Mr.S.D.Shukla   i\/by   M\/s.Shukla   &   Associates   for \nRespondent No.2.\n\nMr.V.R.Dhond   with   Mr.Ameya   Gokhale   i\/by   M\/s.Khaitan   &   Co.for \nRespondent No.3.\n\n\n\n\n\nMr.P.N.Mody   with   Ms.Najma   Shaikh   i\/by   M\/s.Vigil   Juris   for   Respondent \nNo.4. \n\n\n\n\n                                                        ::: Downloaded on - 09\/06\/2013 15:14:13 :::\n                                              3\n\n\n\n                                                 CORAM : A.M.KHANWILKAR &\n                                                               R.G.KETKAR, JJ.\n<\/pre>\n
                                          DATE   : 16TH OCTOBER, 2009.\n<\/p>\n
JUDGMENT:                 (Per R.G.Ketkar, J.)<\/p>\n
    1. Heard   the   learned   counsel   for   the   parties.   Rule.   Counsel   for   the
\n       Respondents   waive   service.   By   consent   rule   is   made   returnable
\n       forthwith and the matter is taken up for hearing and final disposal.\n<\/p>\n
       By  this  petition   under  Article   226<\/a>   of  the   Constitution  of  India,   the <\/p>\n
       petitioners pray for issuance of the writ of mandamus directing the
\n       Respondent No.1 (Union of India) and the Respondent No.2-Bharat <\/p>\n
       Sanchar  Nigam Limited  (BSNL),  to withdraw, recall and  cancel the
\n       evaluation of the bids carried out by them and revaluate the said bids <\/p>\n
       strictly in accordance with the terms of the tender dated May 1, 2008,
\n       issued   by   the   BSNL;   for   issuance   of   a   writ,   order   or   direction <\/p>\n
       prohibiting the BSNL from taking any steps or awarding any contract
\n       to Respondent No.3-KES International Limited and Respondent No.4-\n<\/p>\n
       GTA Limited. The controversy arises in the following circumstances.\n<\/p>\n
    2. On   behalf   of   the   BSNL   sealed   tenders   were   invited   on   two   stage <\/p>\n
       bidding system in four parts from the eligible bidders for planning,
\n       engineering,   supply,   installation,   testing   and   commissioning   of
\n       GSM\/UMTS   based   cellular   mobile   and     supply,   installation,   testing
\n       and   commissioning   of   infrastructure   for   network   of   capacity   of   25 <\/p>\n
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\n                                                4<\/span><\/p>\n
       million lines to be rolled out in three phases in the the licensed service
\n       areas   of   the   BSNL   in   West   Zone   covering   Maharashtra,   Gujrat, <\/p>\n
       Madhya Pradesh, Chatisgarh.\n<\/p>\n
    3. The   tender   is   in     four   parts.   Part-1   covers   planning,   engineering,
\n       supply, installation, testing and commissioning  of GSM based cellular <\/p>\n
       network together with 3GPP R4 Core, IMS, IN and VAS.  Part-2 covers
\n       planning, engineering of 3G network, VAS and MBMS. Part-3 covers <\/p>\n
       supply, installation, testing and commissioning of infrastructure and
\n       associated   items   for   radio   sites.     Part-4   covers   OSS\/BSS.     Eligible <\/p>\n
       bidders   can   participate   in   one   or   more   of   the   parts   independently, <\/p>\n
       subject to the fulfillment of the specified eligibility criteria.\n<\/p>\n
    4. The tender is divided in XI Sections. Section-I is Notice Inviting Tender <\/p>\n
       (NIT). Clauses 3 to 4.8 lay down the eligibility criteria as per Section-\n<\/p>\n
       I.   Clause   3   thereof   provides   for   eligibility   criteria   common   for   all
\n       parts.   Clause 4.1 lays down eligibility criteria for part-1. Clause 4.2 <\/p>\n
       lays down eligibility criteria for part-2, Clause 4.7 lays down eligibility
\n       criteria for part-3 and finally clause 4.8 lays down eligibility criteria
\n       for part-4.\n<\/p>\n
    5. The   tender   envisages   planning,   design,   engineering,   supply,
\n       installation, testing, commissioning and Annual Maintenance Contract
\n       (AMC) for 25 million lines of GSM\/UMTS R6 equipment in four parts <\/p>\n
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\n                                               5<\/span><\/p>\n
       for BSNL Network, each part on turnkey basis in the service areas in
\n       which the BSNL has been licensed to operate its mobile services   in <\/p>\n
       West Zone. The project is proposed to be executed in four parts, out of <\/p>\n
       which parts I, II and III will be executed in three phases whereas part
\n       IV will be executed in only two phases.\n<\/p>\n
    6. Clause 6 of Section-I (NIT) lays down that the bid security in the form
\n       of   Bank   Guarantee   is   Rs.120   crores   (Rupees   One   Hundred   Twenty <\/p>\n
       Crores only)  for part-1, Rs.15 crores (Rupees Fifteen Crores only) for
\n       part-2, Rs. 30 crores (Rupees Thirty Crores only) for part-3 and Rs.15 <\/p>\n
       crores (Rupees Fifteen Crores only) for part-4.\n<\/p>\n
    7. Clause   4.2   of   Section-II   deals   with   Instructions   to   Bidders   (ITB).
\n       Clause   4.2   provides   that   the   bidder   is   expected   to   examine   all <\/p>\n
       instructions, forms, terms and specifications  in the tender document.\n<\/p>\n
       Failure to furnish all information required as per the tender document
\n       or submission of the bid not substantively responsive to the tender <\/p>\n
       document in every respect will be at bidder’s risk and may result in
\n       rejection   of   the   bid.   Clause   5.1   provides   that   a   prospective   bidder
\n       requiring any clarification of tender shall notify the purchaser (BSNL) <\/p>\n
       of such queries in writing or by fax at the BSNL’s address indicated in
\n       the invitation of the bid, among other things. Clause 5.2 provides that
\n       any clarification issued by BSNL in response to the query raised by
\n       prospective bidders shall form integral part of the tender document <\/p>\n
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\n                                               6<\/span><\/p>\n
      and would amount to amendment of relevant clauses of the tender.\n<\/p>\n
    8. Clause 9.1 lays down   that a bidder shall give total composite price <\/p>\n
      inclusive   of   all   levies   and   taxes   viz.excise   duty,   customs   duty,   VAT,
\n      sales tax, service tax, packing, forwarding, freight and insurance etc.,
\n      but excluding octroi\/entry tax which will be paid extra   as per the <\/p>\n
      actual, wherever applicable as per the terms of payment specified in
\n      Section-IV. The  basic unit price and all other components of the price <\/p>\n
      need   to   be   individually   indicated   against   the   goods   and   services   it
\n      proposes  to supply under the contract as per the price schedule given <\/p>\n
      in Section-VII.   Clause 9.2 lays down that the prices indicated in the <\/p>\n
      price   schedule   shall   be   entered   in   a   particular   manner.   Clause   9.5
\n      which is mandatory term of the tender lays down that the discount, if
\n      any, offered by the bidders shall not be considered unless specifically <\/p>\n
      indicated in the price schedule among other things. Clause 10 which is <\/p>\n
      mandatory   term   of   the   tender   provides   for     the   documents
\n      establishing bidder’s eligibility and qualification.\n<\/p>\n
    9. Clause   11.2   provides   that   the   documentary   evidences   of   the
\n      conformity of the goods and services to the tender may be, in the form <\/p>\n
      of literature, drawings, data etc., and the bidder shall furnish  among
\n      other things the compliance of techno-commercial compliance of the
\n      tender terms, conditions and technical specification as sought as per
\n      the procedure  more particularly set out therein. Clause 11.2 (c) (i) to <\/p>\n
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\n                                             7<\/span><\/p>\n
      (vi)   is   mandatory   term   of   the   tender   setting   out   the   procedure
\n      through which techno-commercial   compliance of the tender term or <\/p>\n
      condition and technical specification is sought. Clause 12.1 provides <\/p>\n
      for the amount and form of bid security, which is mandatory term of
\n      the tender. Clause 12.3 thereof provides that the bid security shall be
\n      in the form of a bank guarantee issued by a scheduled bank in favour <\/p>\n
      of the purchaser, valid for a period of 180 days from the date of bid
\n      opening.     The   purchaser   reserves   the   right   to   request   the   lowest <\/p>\n
      bidder during the period of bid evaluation to extend the bid security
\n      for a further period of 120 days and the bidder shall extend the same <\/p>\n
      accordingly. Refusal  to extend the bid security will result in forfeiture <\/p>\n
      of the bid security.\n<\/p>\n
    10.Clause 13.1 is a mandatory term of the tender and lays down that <\/p>\n
      bids   shall   remain   valid   for   150   days   from   the   date   of   opening <\/p>\n
      prescribed by the purchaser pursuant to clause 19.1 and a bid valid
\n      for   a   shorter   period   shall   be   rejected   by   the   purchaser   as   non-\n<\/p>\n
      responsive. Clause 15.1 is also a mandatory term of the tender that
\n      provides for submission of bid in two covers.   The first cover shall
\n      contain original and four copies of the bid duly marked “ORIGINAL”\n<\/p>\n
      and  “COPY”.  The second cover shall contain documents establishing
\n      bidder’s eligibility as per clause 2 alongwith bid security as per clause\n<\/p>\n
      12. Both the covers should be sealed separately by the personal seal of
\n      the bidder. Clause 20 provides for clarification of bids and lays down <\/p>\n
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\n                                              8<\/span><\/p>\n
      that to assist in the examination, evaluation and comparison of bids,
\n      the purchaser (BSNL)   may, at its discretion ask the bidder for the <\/p>\n
      clarification   of   its   bid.   The   request   for   the   clarification   and   the <\/p>\n
      response shall be in writing. However, no post bid clarification at the
\n      initiative of the bidder shall be entertained.\n<\/p>\n
    11.Clause 21 provides for technical and commercial evaluation. Clause
\n      21.2   thereof   is   one   of   the   important   clauses     of   the   tender   and <\/p>\n
      provides that the purchaser (BSNL) shall determine   the substantive
\n      responsiveness of each of the technical and commercial bids to the <\/p>\n
      requirements of the tender document.  A substantively responsive bid <\/p>\n
      is one which conforms  to all technical specifications and commercial
\n      terms   and   conditions   of   the   tender   document   without   material
\n      deviation\/exceptions.   The   BSNL’s   determination                           of   bid’s <\/p>\n
      responsiveness shall be based on the contents of the bid itself without <\/p>\n
      recourse to extrinsic evidence.   Clause 21.3 provides that during the
\n      evaluation, BSNL at its discretion may call upon the bidder to give a <\/p>\n
      techno-commercial presentation of  its offer, to explain the products
\n      offered, its capability to undertake the project and to respond to any
\n      question  from BSNL.  Clause 21.4 lays down that a bid, determined <\/p>\n
      as substantively non-responsive will be rejected by the  purchaser and
\n      shall not subsequent to the bid opening be made responsive by the
\n      bidder by correction of the non-conformity. Clause 21.5 which is one
\n      of the important clauses, provides that the BSNL may waive any minor <\/p>\n
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\n                                                9<\/span><\/p>\n
      infirmity  or non-conformity or  irregularity  in a  bid  which  does  not
\n      constitute   a   material   deviation,   provided   such   waiver   does   not <\/p>\n
      prejudice the establishment of techno-commercial  parity among the <\/p>\n
      bids.   Clause 21.6 is also important term of the tender and lays down
\n      that the financial bids  of only  those technical and commercial bids
\n      that are determined as substantively responsive shall be opened.  The <\/p>\n
      financial   bids   of   those   technical   and   commercial   bids   that   are
\n      determined as substantively non-responsive shall be returned to the <\/p>\n
      respective bidders unopened.\n<\/p>\n
    12.Clause 22.1 is also important clause of the tender and provides that <\/p>\n
      the BSNL shall evaluate and compare the financial bids in detail of
\n      those   technical   and   commercial   bids   previously   determined   to   be
\n      substantively responsive pursuant to clause-21.   Clause 22.2 (a) lays <\/p>\n
      down that the evaluation and comparison of responsive bids shall be <\/p>\n
      done   on   the   basis   of   net   cost   to   BSNL   on   the   prices   of   the   goods
\n      offered   inclusive   of   duties   and   taxes   (but   excluding   CENVAT-able <\/p>\n
      duties & taxes), sales tax, packing, forwarding, freight and insurance
\n      charges etc., as indicated in col.17 of the price schedule in the Section
\n      VII, Part-II of the tender document, and as stipulated in clause 9.1 the <\/p>\n
      octroi\/entry taxes are not to be included in the composite price and
\n      hence the same will not be considered for the purpose of evaluation
\n      and comparison of responsive bids.\n<\/p>\n
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\n                                             10<\/span><\/p>\n
    13.Section IV lays down special conditions of contract. Clause 46 therein
\n       provides   for   Evaluation.   Clauses   46.2(i)   and   2(vii)(a)   are     quoted <\/p>\n
       hereinbelow for ready reference;\n<\/p>\n
          46.2 “Further, the tender shall be evaluated as a package quoted by
\n          the   bidders   for   various   equipments\/materials\/services   as   per   the <\/p>\n
          criterion given below:\n<\/p>\n
             (i) The price of various components forming part of the package
\n             detailed in the SoR at Section-V shall be evaluated. It shall also
\n             include   all   those   items   which   respective   bidders   consider <\/p>\n
             essential for commissioning purposes. The sanctity of the price
\n             of individual items shall be maintained by the bidders within the <\/p>\n
             package even though the evaluation is package based.”\n<\/p>\n
          “46.2(vii) :  In order to establish techno-commercial parity among <\/p>\n
          the bids, the financial bids shall be loaded as below:\n<\/p>\n
             (a) Cases in which bidder has not quoted the price of the item
\n             mentioned in the SoR of the tender document and has not given <\/p>\n
             any comments\/justifications for not quoting the same, the price
\n             bid will be loaded with the maximum price quoted for that item <\/p>\n
             by any other bidder for the purpose of evaluation.”\n<\/p>\n
    14.The   tender   seeks     a   comprehensive   and   complete   requirement   of <\/p>\n
       infrastructure items for the successful installation and commissioning
\n       of the IMPCS network.     Clause 54 of the tender deals with Annual
\n       Maintenance  Contract  (AMC)  and  lays  down    that  the  bidder  shall <\/p>\n
       quote cost of AMC for a period of seven years (AMC for 6th & 7th year
\n       is optional) from the date of completion of each of the three phases of
\n       the project and on the expiry of warranty as mentioned in clause 53.
\n       Annexure-II   deals   with   AMC.   Clause   2.4   thereof   provides   that   the <\/p>\n
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\n                                           11<\/span><\/p>\n
      supplier shall submit list of spares required alongwith the bid and cost
\n      of the same is to be quoted in price schedule. The price shall be same <\/p>\n
      as that quoted in the bill of material against the concerned item in the <\/p>\n
      Schedule Of Requirement (SOR).\n<\/p>\n
    15.In the present case BSNL invited bids by a tender dated May 1, 2008.\n<\/p>\n
      The   technical   &     commercial   bids   were   opened   on   September   10,
\n      2008 and the following bidders had participated :\n<\/p>\n
         i.  M\/s.GTL Ltd. (Respondent No.4)
\n         ii. M\/s.Spanco Pvt.Ltd.\n<\/p>\n
         iii.M\/s.Aster Teleservices Pvt.Ltd.\n<\/p>\n
         iv. M\/s.ACME Tele-Power Ltd. (Petitioner)
\n         v.  M\/s.ICOMM Tele Ltd.\n<\/p>\n
         vi. M\/s.Teracom Pvt.Ltd.,<\/p>\n
         vii.M\/s.KEC International Ltd. (Respondent No.3)<\/p>\n
      On   the   scrutiny   of   technical   and   commercial   bids,   the   bids   of
\n      following bidders were found to be eligible for opening of financial
\n      bids.\n<\/p>\n
         1. M\/s.GTL (Respondent No.4)\n<\/p>\n
         2. M\/s.Spanco\n<\/p>\n
         3. M\/s.KEC (Respondent No.3)\n<\/p>\n
         4. M\/s.ACME<\/p>\n
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\n                                               12<\/span><\/p>\n
         5. M\/s.ICOMM<\/p>\n
    16.By letter dated February 24, 2009 BSNL intimated the eligible bidders <\/p>\n
      that the financial bids will be opened on February 28, 009 so that the
\n      bidders can depute their representatives to attend the same. In the
\n      first   stage   of   evaluation   of   the   bids,   the   Technical   and   Evaluation <\/p>\n
      Committee   (TEC)   was   required   to   evaluate   the   technical   and
\n      commercial   bids   in   accordance   with   clause   21   of   Section   -II.   The <\/p>\n
      financial   bids   of   the   bidders   whose   technical   and   commercial   bids
\n      were   found   by   TEC   to   be   substantively   responsive   were   to   be <\/p>\n
      evaluated further in the second stage of financial evaluation by the <\/p>\n
      Financial Evaluation Committee as per clause 22 of Section-II of the
\n      tender document. Upon evaluation of the financial bids, the Financial
\n      Evaluation   Committee   would   determine   ranking   of   the   bidder   as <\/p>\n
      lowest (L-1), second lowest (L-2), third lowest (L-3) and so on. The <\/p>\n
      tender stipulate that the lowest bidder would be awarded 50% of the
\n      contract in the inverse ratio of the bid amounts.   The lowest bidder <\/p>\n
      could   also   be   invited   for   further   reduction   in   their   prices   by   Price
\n      Negotiation Committee (PNC) and the second & third lowest bidders
\n      were also obliged to execute the contract at such reduced prices of the <\/p>\n
      lowest bidder. After completing this formalities, the purchase orders
\n      for the respective quantities are to be placed on lowest, second lowest
\n      and third lowest bidders.\n<\/p>\n
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\n                                                13<\/span><\/p>\n
    17.It   is   the   case   of   the   petitioners   that   the
\n      Financial   Evaluation   Committee   carried   out   financial   evaluation <\/p>\n
      between March 1, 2009 and April 30, 2009 and submitted its final <\/p>\n
      report before April 30, 2009. During this evaluation the ranking of the
\n      parties   as   SPANCO   as   lowest   (L-1),   GTL-4th   Respondent   as   second
\n      lowest   (L-2),   KEC-3rd   Respondent   as   third   lowest   (L-3),   and     the <\/p>\n
      petitioner as L-4.  It is the further case of the petitioners that the PNC
\n      invited   lowest   bidder   SPANCO   Limited   for   negotiation   for   further <\/p>\n
      reduction in the price sometime in the first week of May, 2009. The
\n      prices   were   lowered   by   SPANCO   and   even   the   PNC   recommended <\/p>\n
      issuance of purchase orders to L-1, L-2 & L-3 in July, 2009 in respect <\/p>\n
      of Western Zone on such reduced and negotiated prices.\n<\/p>\n
    18.The petitioners challenge the techno-commercial evaluation as well as <\/p>\n
      financial evaluation in respect of the item spares which is the major <\/p>\n
      line  item of supply as required by BSNL.  The said item is at serial No.
\n      19   of   Section-V   dealing   with   SOR   (part   III).   It   is   the   case   of   the <\/p>\n
      petitioners   that   the   list   of   spares   was   mandatorily   required   to   be
\n      furnished in the techno-commercial bid, as per clause 11.2 of Section-
\n      II   of   the   tender     read   with   clause   9.1   of   Section-III   dealing   with <\/p>\n
      General (Commercial) Conditions of Contract. The third Respondent
\n      has also not quoted the price of such spares in its financial bid.  In so
\n      far as 4th Respondent is concerned, the grievance of the petitioner is
\n      that in col.5 & 6 of the financial bid, it was necessary for the bidder to <\/p>\n
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\n                                                14<\/span><\/p>\n
      quote excise duty. Both the respondents viz.3rd and 4th Respondent
\n      did not quote the amount of excise duty in col.5 & 6 in the financial <\/p>\n
      bids.  This being the mandatory term of the tender, the BSNL ought to <\/p>\n
      have declared their bids as substantively non-responsive bids.  It is the
\n      submission of the petitioners that since the mandatory terms of the
\n      tender document were not fulfilled by Respondent Nos.3 & 4, as per <\/p>\n
      the   terms   of   tender,   the   BSNL   ought   to   have   declared   the   bids   of
\n      Respondent Nos.3 & 4 as substantively non-responsive bids and ought <\/p>\n
      to have rejected the same.   If that was done by the BSNL, there was
\n      no question of opening the financial bids of Respondent Nos.3 & 4, <\/p>\n
      and should have been returned to the respective bidders unopened  in <\/p>\n
      terms of clause 21.6. In support of this submission, the petitioners rely
\n      upon-\n<\/p>\n
          (i)   Clause 11.2 (b) of Section II<\/p>\n<\/blockquote>\n
          (ii)  Clause 9 of Section III<\/p>\n<\/blockquote>\n
          (iii) Query No.65 and Reply\n<\/p><\/blockquote>\n
          (iv) Clause 54.4 of Section IV<\/p>\n<\/blockquote>\n
          (v)  Clauses 2.4, 2.5 and 2.6 of Annexure II of Section IV.\n<\/p><\/blockquote>\n
    19.In so far as excise duty is concerned, the excise duty leviable on all <\/p>\n
      items of SOR was also mandatorily required to be filled in  percentage
\n      as well as in amount in the financial bids, which were to be filled in as
\n      per   the   price   schedule   as   set   out   in   Section   VII   of   the   tender.   In
\n      support of this submission, the petitioners rely upon –\n<\/p>\n
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\n                                             15<\/span><\/p>\n
         (i)  Clause 9.1 of Section II,<\/p>\n
         (ii) Clause 9.2 of Section II,<\/p>\n
         (iii)Query No.458 and its Reply.\n<\/p>\n
    20.The petitioners rely upon the judgment of the Apex Court in West <\/p>\n
      Bengal State Electricity Board V\/s.Patel Engineering Co.Ltd., (2001) 2
\n      SCC 451.\n<\/p>\n
    21.  The respondents have filed affidavits in opposition to the petition.\n<\/p>\n
      On behalf of the BSNL, Devid S.A., working as AD (MM-I) has sworn <\/p>\n
      affidavit   on   August   20,   2009.   It   is   contended   that   the   evaluation
\n      process is still under process and no cause of action has arisen. It is
\n      contended   that   the   petition   is   pre-mature   and   same   is   based   upon <\/p>\n
      assumption\/anticipation for the purpose of trying to delay the tender <\/p>\n
      process.       On   behalf   of   3rd   Respondent,   Surinder   Bir   has   sworn
\n      affidavit on August 25, 2009 contending interalia that the petition is <\/p>\n
      pre-mature.   It is submitted that the financial bids were opened on
\n      February 28, 2009 and the present petition is instituted  on August 3,
\n      2009 which suffers from delay and latches.     It is further submitted <\/p>\n
      that the evaluation of bids is under process and the BSNL has not yet
\n      issued purchase orders. On merits, it is submitted that the contentions
\n      raised by the petitioners   that the 3rd Respondent has not complied
\n      with the mandatory terms of the tender and in that the technical bid <\/p>\n
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\n                                                16<\/span><\/p>\n
       did not contain the list of spares, as also the financial bid was not in
\n       compliance with the terms and conditions of the tender and the bid is <\/p>\n
       liable   to   be   rejected,   are   wholly   misconceived.       In   substance,   the <\/p>\n
       argument of the 3rd Respondent is  that  these are not the mandatory
\n       terms   of   the   tender.   As   far   as   excise   duty   is   concerned,   under   the
\n       provisions   of   the   Central   Excise   Act<\/a>   and   Rules,   every   person   who <\/p>\n
       produces   or   manufactures     any   excisable   goods   has   to   pay   duty
\n       leviable on such goods. The 3rd Respondent is neither the producer <\/p>\n
       nor the manufacturer of any of the goods. Reliance is placed upon
\n       clause 22.2 of Section-II read with Section-VII, Part-2 dealing with the <\/p>\n
       Price Schedule for indigenous equipments (including partly imported) <\/p>\n
       and service costs and price schedule for imported equipments.\n<\/p>\n
    22.On   behalf   of   4th   Respondent,   Arunkumar   Sinha,   the   constituted <\/p>\n
       attorney has sworn affidavit on August 18, 2009. It is submitted that <\/p>\n
       the petitioners are not entitled to  any reliefs as the petition is barred
\n       by gross and unexplained delay and latches. The petitioners acquired <\/p>\n
       knowledge on February 28, 2009 when the financial bids were opened
\n       and the petition is instituted on August 3, 2009. At any rate, techno-
\n       commercial bids were opened as far back as on September 10, 2008 <\/p>\n
       and   if   the   petitioners   contention   is   valid,   the   BSNL   ought   to   have
\n       declared the bids of 3rd and 4th Respondents as substantively non-
\n       responsive and consequently there was no question of BSNL opening
\n       their  financial bids.  Since the BSNL did not declare the bids of 3rd <\/p>\n
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\n                                              17<\/span><\/p>\n
      and   4th   Respondents   as   substantively   non-responsive   bids   after
\n      opening of these bids on September 10, 2008 and proceeded further <\/p>\n
      for evaluating the financial bids, the cause of action accrued to the <\/p>\n
      petitioners then and there itself.   The petitioners allowed the BSNL to
\n      open  financial bids of 3rd & 4th Respondents on February 28, 2009.
\n      In   view   of   this,   the   petitioners   are   precluded   from   challenging   the <\/p>\n
      techno commercial evaluation of the 3rd & 4th Respondents.  In so far
\n      as financial evaluation is concerned, it is submitted that the financial <\/p>\n
      bids were opened on February 28, 2009 and the present petition is
\n      instituted   on   August   3,   2009.     The   petition   therefore   suffers   from
\n      gross delay and latches.\n<\/p>\n
    23.Mr.Rohit Kapadia, learned senior counsel for the petitioners submitted
\n      that   the   spares   are   important   component   of   the   goods   that   are <\/p>\n
      required to be supplied under the tender as they would be required <\/p>\n
      for replacement, upkeep and maintenance  and  regular functioning of
\n      mobile telephone services   by BSNL immediately upon expiry of one <\/p>\n
      year warranty   period  after commissioning of  the infrastructure for
\n      such mobile telephones. The spares are required to be supplied under
\n      the tender itself and are to be kept in adequate quantities at all sites <\/p>\n
      so that they can be immediately replaced as and when required.\n<\/p>\n
    24.In the instant case, the 3rd Respondent did not furnish list of spares
\n      and also has not quoted price of such spares in its financial bids.  If at <\/p>\n
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\n                                              18<\/span><\/p>\n
    all   the   detailed   list   of   spares   was   not   provided   for   any   reason,   a
\n    deviation\/exception   statement   justifying   for   not   providing   such   list <\/p>\n
    was required to be furnished as per clause 11.2 (b)(ii) of Section II of <\/p>\n
    the   tender.   As  per  clause   31   (iv)   of  Section  II   of   the   tender   if   the
\n    compliance,   deviation\/exception   statement     as   prescribed   are   not
\n    given,   a   bid   is   to   be   rejected   at   the   stage   of   techno-commercial <\/p>\n
    evaluation.   The   3rd   Respondent   has   also   not   furnished   any
\n    deviation\/exception   statement.   In   view   of   this,   the   BSNL   ought   to <\/p>\n
    have rejected the  bid of the 3rd  Responent at the stage  of techno-
\n    commercial   evaluation.   The   fact   that   the   3rd   Respondent   did   not <\/p>\n
    furnish list of spares is established from the Evalution   Chart (pre-\n<\/p>\n
    clarification) annexed by BSNL to its affidavit.   In view of this, it is
\n    submitted that the techno-commercial bid of the 3rd Respondent was
\n    liable  for outright rejection under clause 31 (iv) of Section II.  In this <\/p>\n
    connection,   it   is   further   submitted     that   under   clause   9.2   (ii)   of <\/p>\n
    Section II, the bidders were to quote as per the price schedule given in
\n    Section VII of the tender for “all” the items given in the SOR.   The <\/p>\n
    bidder was to quote the price of such spares in its financial bid.  If the
\n    prices were not filled in as required in the price schedule, the financial
\n    bid   was   liable     for   outright   rejection   in   terms   of   clause   31   (v)   of <\/p>\n
    Section-II.  Admittedly, the 3rd Respondent has not filled-in the price
\n    schedule for all the items of SOR and has left the entire row of prices
\n    of spares in  their financial bids as blank. In view of this the financial
\n    bid     of   the   3rd   Respondent  was  liable   for   outright   rejection   under <\/p>\n
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\n                                              19<\/span><\/p>\n
      clause 31(v) of Section II,  ITB.\n<\/p>\n
    25.It is further contended  that the 4th Respondent has not filled-in the <\/p>\n
      price schedule for all the items of SOR and has left col.5 & 6 of their
\n      financial bid as blank for all the items and thus their financial bid is
\n      liable for outright rejection under clause 31(v) of Section II, ITB. A <\/p>\n
      reliance is placed upon the judgment of the Apex Court in the case of
\n      W.B.State Electricity Board (supra) and in particular paragraph No.24 <\/p>\n
      to contend that in a big and high value  tender,  the degree of care
\n      required is greater than in local bids for small works.  The Apex Court <\/p>\n
      has held that it is essential to maintain the sanctity and integrity of <\/p>\n
      the   process   of   tender\/bid   which   should   be   filled   in   and   the   terms
\n      complied with scrupulously,  and that adherence  to instructions under
\n      ITB   (Section   II   in   the   instant   case),   cannot   be   given   a   go-bye   by <\/p>\n
      branding it as a pedantic approach, otherwise it will encourage and <\/p>\n
      provide scope for discrimination, arbitrariness and favouritism which
\n      are totally opposed to rule of law and constitutional values.     It has <\/p>\n
      been further held therein that relaxation of such rules in favour of one
\n      or the other bidder would impair the rule of transparency and fairness
\n      and provide a room for manipulation in picking and choosing a bidder <\/p>\n
      which is not permissible in law for State Authorities.\n<\/p>\n
    26.Dealing with the contentions raised by BSNL in its affidavit to the
\n      effect that in the given case taking into consideration   the quantum, <\/p>\n
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\n                                            20<\/span><\/p>\n
      nature, costs, technicalities involved, if the special conditions of the
\n      contract were strictly implied all the bids of the eligible bidders would <\/p>\n
      have been bound to be rejected and the entire bid process would have <\/p>\n
      had to be renegotiated, which would have been time consuming at the
\n      cost   of   substantial   public   money   and   delay   in   process   of
\n      implementation of tender work,  and to overcome that the remedy of <\/p>\n
      obtaining   unconditional   undertaking   was   obtained   from   all   the
\n      eligible bidders to comply with the tender conditions, it is submitted <\/p>\n
      that the entire approach of the BSNL was unsustainable. In the first
\n      place, the BSNL  has failed to point out any fatal deficiency in the bids <\/p>\n
      of   either     the   petitioners   or   the   other   bidders   excepting   the <\/p>\n
      Respondent Nos.3 & 4. Secondly, such undertakings could not have
\n      been obtained after opening of  the  bids in terms of  clause  21.4 of
\n      Section II of the tender. Such undertakings would also disturb techno-\n<\/p>\n
      commercial parity interse the bidders, they could not have been called <\/p>\n
      for by the BSNL in view of clause 21.5 of Section-II of the tender.\n<\/p>\n
    27.Mr.Dhond,  learned  counsel  on  behalf  of  3rd   Respondent submitted
\n      that the contentions of the petitioners that failure to provide a list of
\n      spares and or excise duty on all items in the SOR should result in <\/p>\n
      rejection of the bids, is wholly mis-conceived and contrary to plain
\n      terms   of   the   tender.   Under   the   tender,   bidders   were   required   to
\n      furnish their bids in accordance with SOR (Part-III) which is set out in
\n      Section V of the tender. Perusal of Section V indicates that as many as <\/p>\n
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\n                                               21<\/span><\/p>\n
       173 items are set out therein. One of the items is entitled “spares”.
\n       The spares form a very small part or component of the SOR which is <\/p>\n
       required to be submitted in response to the tender.   The spares are <\/p>\n
       relevant   only   in   the   context   of   upkeep   and   maintenance   of   the
\n       equipment which is supplied by the respective bidders. The spares are
\n       needed   when   an   individual   component   either   breaks   down   or   is <\/p>\n
       consumed or requires replacement. As per the tender, the bidders have
\n       to quote costs of AMC for a period of seven years (AMC for 6th & 7th <\/p>\n
       year is optional), from the date of completion of each of three phases
\n       of the project and on expiry of warranty as mentioned in clause 53.  It <\/p>\n
       is common ground between the parties that the warranty period was <\/p>\n
       one   year   from   the   date   of   commissioning   of   the   equipment.
\n       Consequently,   for   a   period   of   8   (7+1)   years   from   the   date   of
\n       commissioning,   bidder   would   be   responsible   for   ensuring   that   the <\/p>\n
       equipment was kept fully operational and\/or functional, and it would <\/p>\n
       be his responsibility  to keep the equipment operational, and the BSNL
\n       would not be required to bear any expenditure towards the spares.\n<\/p>\n
    28.It   is   further   submitted   that   clause   31   of   Section   II   of   the   ITB
\n       particularises     those   conditions   which   are   essential   and   mandatory <\/p>\n
       and whose non-compliance would result in outright rejection of the
\n       bid.  In so far as grievance of the petitioners about non-compliance of
\n       clause 31 (v) of Section-II is concerned, the grievance  is wholly mis-
\n       conceived, inasmuch as clause 31(v) of Section-II lays down  rejection <\/p>\n
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\n                                                22<\/span><\/p>\n
      of the bid on account of prices not filled-in as prescribed in the price
\n      schedule.     It   is   submitted   that   clause   31(v)   of   Section   II   has   no <\/p>\n
      application   whatsoever   to   the   present   case   as   the   bid   of   the   3rd <\/p>\n
      Respondent   has   been   filled   in   the   manner   prescribed   in   the   price
\n      schedule   in   Section   VII.   Under   clause   31(iv)   of   Section-II   of   the
\n      tender,   non-compliance   of   clause   11.2.(c)   of   Section-II   being <\/p>\n
      mandatory is fatal.   Clause 11.2 (b) of Section-II deals with the list
\n      giving full particulars including available sources and current prices of <\/p>\n
      all   spare   parts,   tools   etc.   necessary   for   proper   and   continuous
\n      functioning   of   the   goods   for   a   period   of   eight   years   following <\/p>\n
      commencement of use of the goods by the BSNL, which  is required to <\/p>\n
      be furnished by the bidder.  However, clause 11.2 (b) that deals with
\n      furnishing list of all spare parts as detailed therein is not included in
\n      clause   31   of   Section   II.   In   view   of   this,   it   is   submitted   that   the <\/p>\n
      grievances   of   the   petitioners   on   the   ground   of   spares   is   wholly <\/p>\n
      unsustainable.\n<\/p>\n
    29.At any rate it is submitted, that clause 46.2 (vii) (a) of Section IV lays
\n      down that in order to establish techno commercial parity among the
\n      bids, the financial bids shall be loaded as under:-\n<\/p>\n
         Cases   in   which   bidder   has   not   quoted   the   price   of   the   item
\n         mentioned in SOR of the tender document and has not given any
\n         comments\/justifications for not quoting the same, the price bid will
\n         be  loaded   with  the   maximum  price   quoted  for  that  item  by  any <\/p>\n
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\n                                              23<\/span><\/p>\n
         other bidder for the purpose of evaluation.\n<\/p>\n
      In view of this it is submitted that where price of the item has not <\/p>\n
      been mentioned, the BSNL is not remedyless and can invoke clause
\n      46.2 (vii) (a) of Section IV of the tender.\n<\/p>\n
    30.Mr.Modi, learned counsel for the 4th Respondent submitted that the
\n      4th Respondent does not manufacture any of the items listed in the <\/p>\n
      tender.   If   the   tender   is   awarded   to   the   4th   Respondent   it   will   be
\n      merely purchasing the said items from other manufacturers\/suppliers.\n<\/p>\n
      Under   the   provisions   of   Central   Excise   Act<\/a>   and   Rules,   it   is   the <\/p>\n
      respective producer  or manufacturer who has to pay the excise duty
\n      to   the   Excise   Authorities   and   not   the   4th   Respondent.     There   is
\n      therefore no question of 4th Respondent failing or neglecting to fill in <\/p>\n
      col.5 & 6 of Section VII (Part-II) dealing with the price schedule  for <\/p>\n
      indigenous equipment (including partly imported) and service costs
\n      and the price schedule for imported equipments. It is explained in the <\/p>\n
      affidavit made on behalf of the 4th Respondent that ex-factory price
\n      (basic unit price exclusive of all levies and charges) in col.4, and the
\n      excise duty in col.5 & 6 of the prescribed format would have to be <\/p>\n
      detailed up alongwith other costs to arrive at the unit price in col.12,
\n      which in turn would get directly reflected in col.17 and the format as
\n      the   total   discounted   price   excluding   cenvatable   duties   and   taxes.
\n      Cenvatable duties & tax amounts were shown in col.13 of the said <\/p>\n
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\n                                              24<\/span><\/p>\n
      format wherever available. It is also submitted that as per clause 22.2
\n      of Section-II of the tender (ITB), the evaluation and comparison of the <\/p>\n
      bids is to be made on the basis of net costs to BSNL of the goods <\/p>\n
      offered inclusive of duties and taxes but excluding cenvatable duties
\n      and taxes  as indicated in col.17. Col.17 of the said format would be
\n      effective net costs to the BSNL after getting credit\/benefit for the said <\/p>\n
      cenvatable duties and taxes. In view of this, it was denied that the bid
\n      of   the   4th   Respondent   was   misleading   or   manipulating   as   falsely <\/p>\n
      alleged.  It was also submitted that the tenders are yet to be evaluated
\n      and in fact as per clause 21.3 of Section II of the tender (ITB), it is <\/p>\n
      provided   that   while   evaluating   the   said   bid   the   BSNL   would   be <\/p>\n
      entitled to call upon to furnish clarifications. On these among other
\n      grounds, the 4th Respondent has prayed for dismissal of the petition.\n<\/p>\n
    31.On behalf of the BSNL Mr.Shukla, learned counsel reiterated that the <\/p>\n
      evaluation process is still under process and no cause of action has
\n      arisen. Having regard to the magnitude and scope of the work, it must <\/p>\n
      have   freedom   of   contract,   in   other   words,   fairplay   in   the   joints   is
\n      necessary   concomitant   for   administrative   body   functioning   in   an
\n      administrative   sphere   or   quasi   administrative   sphere.   He   submitted <\/p>\n
      that  though at pre-clarification stage the 3rd and 4th Respondents did
\n      not submit spares list, at the stage of post-clarification stage the 3rd
\n      and 4th Respondents did supply spares list.  At any rate, both at pre-
\n      clarification and post-clarification stages, the 3rd and 4th Respondents <\/p>\n
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\n                                              25<\/span><\/p>\n
       had   given   NIL   deviation   statement.   He   also   contended   that   the
\n       petition is prematured   as the purchase orders are not issued as the <\/p>\n
       evaluation process is still under process.\n<\/p>\n
    32.On behalf of the petitioners Chamber Summons No.296 of 2009 was
\n       taken out seeking a permission to amend the writ petition as per the <\/p>\n
       schedule   annexed   thereto.   With   the   consent   of   the   parties,   we
\n       proceeded to hear the main petition alongwith the chamber summons <\/p>\n
       finally at the stage of admission itself. The chamber summons is taken
\n       out mainly to counter the submissions made by the Respondents that <\/p>\n
       the petition is premature. On the basis  of annexures to the chamber <\/p>\n
       summons it is submitted that the financial evaluation is over and in
\n       fact the PNC has  negotiated  with  the  lowest bidder M\/s.Spanco. It
\n       therefore   cannot   be   said   that   the   petition   is   premature.     If   the <\/p>\n
       petitioners were to institute the petition after issue of purchase orders <\/p>\n
       in favour of successful bidders, either it would have been met with
\n       fate   accompli   or   it   would   have   been   contended   on   behalf   of   the <\/p>\n
       successful   bidders   that   now   the   rights   have   been   created   in   their
\n       favour and in  that case, the petitioners would be left with no effective
\n       remedy.\n<\/p>\n
    33.While   explaining   the   procurement   of   report   of   the   Committee   for
\n       Evaluation of Tender in respect of financial bid   and the copy of the
\n       report   of   the   Price   Negotiation   Committee,   it   is   asserted   that   the <\/p>\n
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\n                                             26<\/span><\/p>\n
      matter was heard on Friday-September 5, 2009 and was stood over to
\n      Monday-September   7,   2009.   To   the   surprise   of   the   petitioners   on <\/p>\n
      Monday-September 7, 2009 a packet was left at the petitioners office <\/p>\n
      addressed   to   the   Petitioner   No.1.   On   opening   of   the   same,   the
\n      petitioners were surprised to see the contents thereof which were the
\n      copy   of   the   report   of   the   Committee   for   Evaluation   of   Tender   in <\/p>\n
      respect of the financial bids and the copy of the report of the Price
\n      Negotiation Committee. Under the circumstances, the petitioners are <\/p>\n
      not  aware   of  the  identity of  the  person  who  left  the  packet at  the
\n      office of the Petitioner No.1. These assertions were strongly refuted by <\/p>\n
      the Respondents by filing affidavits in opposition.\n<\/p>\n
    34.Mr.Kapadia relied upon the following judgments:\n<\/p>\n
      (i)  Magraj   Patodia   V\/s.R.K.Birla,   AIR   1971   SC   1295,    and   in <\/p>\n
      particular paragraph No.20 thereof. The relevant portion thereof reads
\n      as under:\n<\/p>\n
         “The fact that a document was procured by improper or even illegal
\n         means, will not be a bar to its admissibility if it is relevant and its <\/p>\n
         genuineness is proved.\n<\/p>\n
      (ii) Bombay Chemical Limited V\/s.Union of India, 2007 (8) S.T.R.
\n      417 (Bom)  and in particular Paragraph No.7 thereof. In paragraph <\/p>\n
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\n                                                27<\/span><\/p>\n
       No.7 the Court observed that as the authenticity of xerox copy of the
\n       order dated March 22, 1995 passed by the then Assistant Collector <\/p>\n
       produced   by   the   petitioner   was   challenged   by   the   Respondent,   the <\/p>\n
       Court directed   the department to produce the original record. After
\n       careful perusal of the record, the court found that the copy produced
\n       before   the   court   was   in   fact   true   xerox   copy   of   the   original   order <\/p>\n
       which was in the office record.   In that context, the Division Bench
\n       observed as under:-\n<\/p>\n
       “…..Hence,   the   source   from   which   the   petitioners   got   the   copy,   is
\n       immaterial”.\n<\/p>\n
    35.Mr.Kapadia invited our attention to the affidavit made on behalf of
\n       BSNL in opposition to the chamber summons wherein the BSNL did
\n       not   deny   existence   of   the   documents,   but   mere   authenticity   of   the <\/p>\n
       documents referred by the petitioners. He therefore submitted that the <\/p>\n
       court   should   call   upon   the   BSNL   to   produce   the   original   file
\n       containing the copy of the report of the Committee for Evaluation of <\/p>\n
       the Tender in respect of the financial bids and the copy of the report
\n       of the Price Negotiation Committee (PNC).\n<\/p>\n
    36.Mr.Kapadia   further   submitted   that   the   BSNL   has   determined   the
\n       ranking   of   the   bids   as   lowest   (L-1),   second   lowest   (L-2)   and   third
\n       lowest (L-3).  He invited our attention to the affidavit made on behalf
\n       of the BSNL by David S.A., working as A.D.(MM-I).  In paragraph No,<\/p>\n
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\n                                                  28<\/span><\/p>\n
       9 of the said affidavit it is set out that the tender process is divided
\n       into following parts:\n<\/p>\n
       (i) preparation of bid <\/p>\n
       (ii)invitation and opening of bid\\\n<\/p>\n
       (iii)Pre-clarification techno-commercial evaluation\n<\/p>\n
       (iv)evaluation of financial bid<\/p>\n
       (v)awarding of tender.\n<\/p>\n
    37.It   has   been   thereafter   set   out   that     on   the   basis   of     financial   bid
\n       submitted, L-1, L-2 and L-3  have been determined. In Paragraph No.<\/p>\n
       13 of the said affidavit,  it has been set out that the CET has submitted <\/p>\n
       its recommendations and L-1, L-2 and L-3 have only been determined,
\n       but further process is still pending as still the price negotiations  with
\n       L-1   are   yet   to   take   place.   On   the   basis   of   assertions   made   in   the <\/p>\n
       affidavit   of   the   BSNL,   Mr.Kapadia   submitted   that   the   financial <\/p>\n
       evaluation is over and in fact BSNL has determined the ranking of the
\n       bids as L-1, L-2 and L-3. He therefore submitted that the contentions <\/p>\n
       raised by the respondents that the petition is pre-mature is contrary to
\n       the record and factually incorrect.\n<\/p>\n
    38.Opposing the Chamber summons BSNL has made affidavit of David
\n       S.A.     He   has   submitted   that   though   the   BSNL   has   determined   the
\n       ranking of bids as L-1, L-2 and L3, nonetheless there is substantial
\n       process  left  before   finally  evaluating   L-1,   L-2  and   L-3   as  successful <\/p>\n
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\n                                               29<\/span><\/p>\n
       bidders.   Though   the   PNC   has   negotiated   with   L-1,   the
\n       recommendations of the PNC are yet to be approved by the tendering <\/p>\n
       authority.   If the tendering authority approves the recommendations <\/p>\n
       of the Committee as regards L-1, as also rates, the tender work would
\n       be   allotted   to   L-1,   which   would   be   final   subject   to   L-1   furnishing
\n       unconditional   acceptance   and   performance   security   in   conformity <\/p>\n
       with  Section IX of the tender. If L-1 fails to comply with the requisite
\n       conditions, the entire bid would be terminated and recalled.\n<\/p>\n
    39. On   behalf   of   Respondent   No.4,   Mr.Arun   Kumar   Sinha,   constituted <\/p>\n
       attorney  has made an affidavit opposing the Chamber Summons. It is <\/p>\n
       submitted that it is patently absurd and dishonest attempt on the part
\n       of the petitioner to explain away as to how they obtained copies of the
\n       confidential   documents.   When   the   court   directed   the   petitioners   to <\/p>\n
       disclose the source thereof, they came out with an explanation that <\/p>\n
       the   copies   of   the   said   documents   were   left   in   a   packet   at   the
\n       petitioner’s office addressed on September 7, 2009 by some unknown <\/p>\n
       person. The said story is ex-facie false and perjurious and impossible
\n       to accept. The said attempt is intended only to obfuscate and cover up
\n       the mischief and corrupt practices of the petitioners. It is contended <\/p>\n
       that the petitioners have not come to this Court with clean hands. It is
\n       reiterated that the contentions raised earlier by 4th Respondent about
\n       the petition being pre-mature is  based on the fact that no contract or
\n       purchase order or LOI was issued by the BSNL and that the tender <\/p>\n
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\n                                              30<\/span><\/p>\n
      evaluation process is incomplete.\n<\/p>\n
    40.On behalf of 3rd Respondent, Mr.Surinder Bir has made an affidavit <\/p>\n
      opposing the chamber summons. It is submitted that the explanation
\n      given by the petitioners as to how they got hold of the documents is
\n      totally   unsatisfactory   and   insufficient.   At   the   highest   the   said <\/p>\n
      documents would be relevant for considering  whether the petition is
\n      pre-mature or otherwise.\n<\/p>\n
    41.After hearing the learned counsel appearing for the parties and also <\/p>\n
      considering the material on record, it is   abundantly clear that the <\/p>\n
      BSNL   has   completed   the   financial   evaluation   and   determined   the
\n      ranking   of   the   bids   as   lowest   (L-1),   second   lowest   (L-2)   and   third
\n      lowest (L-3).   It is only after   completion of the financial evaluation <\/p>\n
      the   ranking   of   the   bids   could   be   determined.   From   perusal   of   the <\/p>\n
      affidavit made in opposition on behalf of the BSNL to the chamber
\n      summons,   it   is   abundantly   clear   that   after   evaluating   the   financial <\/p>\n
      bids, the BSNL has determined the ranking of the bids. It may be the
\n      recommendations of the PNC as regard its negotiations with L-1 are
\n      yet to   be  approved  by  the  tendering  authority.  But nonetheless  the <\/p>\n
      negotiations could be carried out by PNC only after evaluation of the
\n      financial   bids.   In   our   considered   opinion,     therefore,     the   petition
\n      cannot be said to be pre-mature. Undoubtedly the petitioners have not
\n      explained   as   to   how   they   got   hold   of   these   documents.     For,   the <\/p>\n
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\n                                               31<\/span><\/p>\n
       explanation   offered   by   the   petitioners   in   paragraph   21   C   of   the
\n       affidavit in support of the Chamber Summons is unacceptable. BSNL, <\/p>\n
       however,   admits   existence   of   these   documents   and   denies   mere <\/p>\n
       authenticity   thereof.   The   best   course   for   the   BSNL,   being   a   public
\n       body,  was to produce the original record for perusal of this Court. At
\n       any rate, the least  that was expected from the BSNL was to produce <\/p>\n
       the   authentic   copy   of   the   document   alongwith   the   affidavit   in
\n       opposition   to the Chamber Summons. To observe sobriety we leave <\/p>\n
       the matter at that.\n<\/p>\n
    42.Be   that   as   it   may,   now   turning   to   the   merits   of   the   case,   the <\/p>\n
       petitioners main grievance is two fold against the Respondents. Firstly,
\n       not   furnishing   the   list   of   spares   by   Respondent   Nos.3   &   4,   and
\n       secondly,  not filling in the amount of excise duty in col.5 & 6  in the <\/p>\n
       financial   bids   by   Respondent   Nos.3   &   4.     Before   proceeding   to <\/p>\n
       ascertain answers to the above questions it will be useful to bear in
\n       mind the principles governing the exercise of power of judicial review <\/p>\n
       by   this   Court.   After   exhaustive   consideration   of   long   line   of
\n       authorities, the Apex Court in the case of Tata Cellular V\/s. Union of
\n       India (1994) 6 SCC 651, succinctly summarised the position and laid <\/p>\n
       down the following principles:-\n<\/p>\n
           “(1)The modern trend points to judicial restraint in administrative
\n           action.\n<\/p><\/blockquote>\n
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\n                                                  32<\/span><\/p>\n
           (2) The Court does not sit as a court of appeal but merely reviews
\n           the manner in which the decision was made.\n<\/p><\/blockquote>\n
           (3)   The   court   does   not   have   the   expertise   to   correct   the
\n           administrative decision. If a review of the administrative decision is <\/p>\n
           permitted   it   will   be   substituting   its   own   decision,   without   the
\n           necessary expertise which itself may be fallible.\n<\/p><\/blockquote>\n
           (4) The terms of the invitation to tender cannot be open to judicial
\n           scrutiny because the invitation to tender is in the realm of contract.
\n           Normally speaking, the decision to accept the tender or award the
\n           contract is reached by process of negotiations through several tiers.\n<\/p><\/blockquote>\n
           More   often   than   not,   such   decisions   are   made   qualitatively   by
\n           experts.\n<\/p><\/blockquote>\n
           (5)   The   Government   must   have   freedom   of   contract.   In   other
\n           words, a fair play in the joints is a necessary concomitant for an <\/p>\n
           administrative   body   functioning   in   an   administrative   sphere   or
\n           quasi-administrative sphere. However, the decision must not only
\n           be   tested   by   the   application   of   Wednesbury   principle   of <\/p>\n
           reasonableness   (including   its   other   facts   pointed   out   above)   but
\n           must be free from arbitrariness not affected by bias or actuated by <\/p>\n
           mala fides.\n<\/p><\/blockquote>\n
           (6) Quashing decisions may impose heavy administrative burden <\/p>\n
           on   the   administration   and   lead   to   increased   and   unbudgeted
\n           expenditure.”\n<\/p><\/blockquote>\n
       In the light of these principles we shall determine the questions raised <\/p>\n
       in the present petition.\n<\/p>\n
    43.In   so   far   as   not   furnishing   of   list   of   spares,   giving   full   particulars
\n       including   available     source   and   current   prices   of   all   spare   parts, <\/p>\n
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\n                                              33<\/span><\/p>\n
       specially tools etc. (clause 11.2(b)), the petitioners contend that as
\n       per clause 31 of Section II, non-furnishing of such list alongwith the <\/p>\n
       techno commercial bid is fatal. The BSNL ought to have  declared bids <\/p>\n
       of the 3rd and 4th Respondents as substantively non-responsive bids
\n       and   returned   the   financial   bids   unopened   to   the   3rd   &   4th
\n       Respondents.\n<\/p>\n
    44.With   regard   to   issue   of   spares   the   petitioners   rely   upon   following <\/p>\n
       clauses in the tender: –\n<\/p>\n
       Clause 11.2(b) of Section-II,
\n       Clause 9 of Section-III, <\/p>\n
       Clause 54.4 of Section-IV,
\n       Clauses 2.4, 2.5 and 2.6 of Annexure II of Section-IV.\n<\/p>\n
       Aforesaid clauses read as under:-\n<\/p>\n
       Clause  11.2(b) of Section-II: A list, giving full  particulars including <\/p>\n
       available sources and current prices of all spares parts, sp0ecial tools,
\n       etc., necessary for the proper and continuous functioning of the goods
\n       for   a  period   of   eight   years   following   commencement   of   use   of  the
\n       goods by the purchaser.”\n<\/p>\n
       Clause 9 of Section-III  – Spares.\n<\/p>\n
       Clause 54.4 of Section-IV – The bidder shall, at the time of submitting
\n       the   bid   submit   the   proposal   specifying   the   fault   control   centre
\n       locations   together   with   the   resources   to   be   deployed   including   the <\/p>\n
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\n                                               34<\/span><\/p>\n
       number of personnel and how the bidder proposes to carry out repair
\n       under AMC.  He shall also indicate the list of spares together with the
\n       quantity   that   will   be   kept   in   different   locations.   The   infrastructure <\/p>\n
       planned   to   be   created   by   the   bidder   to   fulfil   his   obligations   under
\n       AMC and his action plan to deal with the various situations arising out <\/p>\n
       of hardware and software faults shall be clearly indicated.\n<\/p>\n
       Clauses 2.4, 2.5 and 2.6 of Annexure II of Section-IV:\n<\/p>\n
       2.4  – The supplier shall submit a list of spares required alongwith the
\n       bid and cost of the same is to be quoted in the price schedule. The
\n       price shall be same as that quoted in the bill of material against the <\/p>\n
       concerned item in the SOR.   The spares are to be kept at each core
\n       network   elements   locations   and   at   each   BSC\/RNC   locations   in   the <\/p>\n
       custody   of   BSNL.   BSNL   shall   arrange   space   for   the   same.   The
\n       minimum number of the spares to be supplied are as per the chart.\n<\/p>\n
       2.5 – BSNL staff will replace the faulty units from the stock available
\n       wherever possible and attend to the fault. However, should there be a
\n       problem vendor shall arrange telephonic support in diagnostic of the <\/p>\n
       fault and also in replacing the card.  In any case such fault could not
\n       be attended to, the support team of the vendor shall be responsible to <\/p>\n
       arrange rectification of the fault  at site within stipulated time frame.\n<\/p>\n
       2.6 –  The spares thus ordered are to be supplied within 6 months of <\/p>\n
       placing the purchase orders. The date of expiry of warranty shall be
\n       extended by the no.of days there is delay in supplying of such spares
\n       at all these sites.\n<\/p>\n
    45.The   petitioners   have   also   relied   upon   Query   No.65   and   the   reply <\/p>\n
       given to the same, which read as under:-\n<\/p>\n
       Query 65  – List of following material and notification pertaining to
\n       spare parts not provided. Please provide the same. Since the spares
\n       will be covered under warranty as well as AMC what is the purpose of
\n       providing   spare   parts   under   pricing.   Since   this   clause   demand   the <\/p>\n
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\n                                             35<\/span><\/p>\n
      quantities also whether the price of the spares will become part of the
\n      evaluation.\n<\/p>\n
      Reply  – Please refer to sub clause of this clause. Further prices are
\n      being asked so that BSNL can decide to procure spare parts after AMC <\/p>\n
      period. Prices are also required for evaluation.\n<\/p>\n
    46.On the other hand the Respondents 3 and 4 submit that Clause 31 of <\/p>\n
      Section   II   lays   down   the   mandatory   clauses   of   the   tender,   failure
\n      whereof would result in outright rejection of the bid. The said clause
\n      31 reads as under:-\n<\/p>\n
      While all the conditions specified  in the tender document are critical
\n      and are to be complied, special attention of bidder is invited to the <\/p>\n
      following clauses of the bid documents, non-compliance of any one of
\n      which shall result in out right rejection of the bid:\n<\/p>\n
      (i)Clause   15.1   of   Section-II:  The   bids   will   be   recorded\/returned <\/p>\n
      unopened if covers are not properly sealed with ‘PERSONAL SEAL’ of
\n      the bidder.\n<\/p>\n
      (ii)Clauses 12.1, 12.3 and 13.1 of Section-II:  The bids will be rejected
\n      at opening stage if Bid security is not submitted as per Clauses 12.1 & <\/p>\n
      12.3 and bid validity is less than the period prescribed in Clause 13.1
\n      mentioned above.\n<\/p>\n
      (iii)Clause 2 and 10 of Section-II:  If the eligibility condition as per <\/p>\n
      clause-2   of   Section   -II   is   not   met   and   documents   prescribed   to
\n      establish the eligibility as per Clause-10 of Section-II are not enclosed,
\n      the bids will be rejected without further evaluation.\n<\/p>\n
      (iv)Clause   11.2(c)   of   Section   II:     If   the   compliance,
\n      deviation\/exception statement as prescribed are not given, the bid will <\/p>\n
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\n                                                 36<\/span><\/p>\n
      be rejected at the stage of techno-commercial evaluation. In case of no
\n      deviations, a statement to that effect must be given.\n<\/p>\n
      (v)Section-VII Price Schedule:  Prices are not filled in as prescribed in
\n      price schedule.\n<\/p>\n
      (vi)Section-II   clause   9.5   on   discount  which   is   reproduced
\n      below:”Discount, if any, offered by the bidder shall not be considered <\/p>\n
      unless specifically indicated in the price schedule.  Bidders desiring to
\n      offer discount shall therefore modify their offer suitably while quoting
\n      and shall quote clearly net price taking all such factors like Discount,
\n      free supply etc.into account”.\n<\/p>\n
      (vii)Section-Unpriced detailed bill of material with card level details <\/p>\n
      in the techno-commercial bid and the exactly same bill of materials
\n      with card level prices in the financial bid.\n<\/p>\n
    47.The Respondents 3 & 4 contend they have not committed breach of
\n      any of the requirements laid down in clause 31 of Section-II. In so far <\/p>\n
      as alleged non-compliance of clause 31(v) of Section-II is concerned,
\n      the Respondents have filled in bid in the manner prescribed in the <\/p>\n
      price schedule in Section VII.  Under clause 31(iv) of Section-II of the
\n      tender   clause     11.2(b)   of   Section-II   is   not   included   and   non-\n<\/p>\n
      compliance of clause 11.2(c) of Section-II is fatal as it is mandatory.
\n      Under clause 31(iv) non-compliance of   clause 11.2(c) of Section II
\n      would   result   in   outright   rejection   of   the   bid.   In   view   of   this   it   is <\/p>\n
      strenuously   submitted   that   in   so   far   as   the   first   grievance   of   the
\n      petitioners   as   regards   the   spares   is   concerned,   the   same   is   wholly
\n      unsustainable.\n<\/p>\n
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\n                                               37<\/span><\/p>\n
    48.We find considerable merit in the submissions advanced on behalf of
\n      the 3rd and   4th Respondents. Perusal of clause 31 of Section-II lays <\/p>\n
      down the mandatory clauses of the tender and failure to comply these <\/p>\n
      clauses   would   result   in   outright   rejection   of   the   bid.   There   is   no
\n      breach of clause 31(iv) & (v) of Section-II committed   by the 3rd &
\n      4th   Respondents.     As   observed   earlier   clause   31   (iv)   of   Section   II <\/p>\n
      provides   that   non-compliance   of   clause   11.2(c)   would   result   in
\n      outright rejection of the bid.  If the compliance of deviation\/exception <\/p>\n
      statement as prescribed are not given, the bid will be rejected at the
\n      stage of techno-commercial evaluation. In case of no deviation, the <\/p>\n
      statement   to that effect has to be given. From the affidavit of BSNL <\/p>\n
      dated   August   20,   2009   it   is   clear   that   the   Respondent   Nos.3   &   4
\n      submitted spares list at the stage of post-clarification stage.   Both at
\n      pre-clarification and post-clarification stages, the Respondent Nos.3 & <\/p>\n
      4   had   given   NIL   deviation   statement.   As   far   as   clause   11.2(c)     is <\/p>\n
      concerned, it lays down the procedure by which the compliance  of
\n      techno-commercial   compliance   of   the   tender   terms,   conditions   and <\/p>\n
      technical specifications is to be submitted. The Respondent Nos.3 & 4
\n      have not committed breach of clause 11.2(c) (i) to (vi) of Section II of
\n      the tender. The petitioners are complaining about the non-compliance <\/p>\n
      of clause 11.2(b) of Section II of the tender. We are therefore of the
\n      opinion   that   there   is   no   substance   in   the   submission   advanced   on
\n      behalf   of   the   petitioners   that   there   is   breach   of   clause   31   (iv)   of
\n      Section II. In so far as non-compliance of clause 31 (v) of Section II is <\/p>\n
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\n                                             38<\/span><\/p>\n
      concerned, it lays down the manner in which the prices are to be filled\n<\/p>\n
      -in in the price schedule in Section-VII.  We are of the opinion that the <\/p>\n
      Respondent Nos.3 & 4 have filled in the prices in price schedule as <\/p>\n
      prescribed and there is no breach committed by them.\n<\/p>\n
    49.Apart from merit,  it is further submitted by the Respondents that the <\/p>\n
      techno-commercial bid was  opened  by the  BSNL on September 10,
\n      2008   and   the   bids   of   3rd   &   4th   Respondents   were   declared   to   be <\/p>\n
      substantively   responsive   bids.   The   cause   of   action   accrued   to   the
\n      petitioners   after   September   10,   2008     as   the   BSNL   thereafter <\/p>\n
      proceeded further with the process of evaluation of   bids of the 3rd <\/p>\n
      and 4th Respondents. The petitioners allowed the tender process to
\n      proceed   further   and   instituted   the   present   petition   as   late   as   on
\n      August 3, 2009. It is therefore submitted that in the first place, the <\/p>\n
      petition suffers from gross delay and latches. Secondly, the petitioners <\/p>\n
      are precluded from challenging the techno-commercial evaluation of
\n      the 3rd and 4th Respondents.\n<\/p>\n
    50.In this behalf, clause 21 of Section II of tender dealing with techno
\n      commercial evaluation is material and the same reads as under:-\n<\/p>\n
      “Technical and Commercial Evaluation:\n<\/p>\n
      21.1  In the first stage of evaluation, the purchaser shall evaluate the
\n      bids to determine whether they are complete, whether required bid <\/p>\n
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\n                                             39<\/span><\/p>\n
      security   has   been   furnished,   whether   the   documents   have   been
\n      properly signed and whether the bids are generally in order.\n<\/p>\n
      21.2     Purchaser   shall   determine   the   substantive   responsiveness   of
\n      each of the technical and commercial bids to he requirements of the <\/p>\n
      tender   document.   A   substantively   responsive   bid   is   one   which
\n      conforms   to   all   technical   specifications   and   commercial   terms   and
\n      conditions   of   the   tender   document   without   material <\/p>\n
      deviation\/exceptions.   The   purchaser’s   determination   of   bid’s
\n      responsiveness shall be based on the contents of the bid itself without
\n      recourse to extrinsic evidence.\n<\/p>\n
      21.3  During the evaluation, BSNL at its discretion may call upon the
\n      bidder to give a techno-commercial presentation of its offer, to explain <\/p>\n
      the   products   offered,   its  capability   to   undertake   the   project  and   to
\n      respond to any question from BSNL.\n<\/p>\n
      21.4 A bid determined as substantively non-responsive will be rejected
\n      by the purchaser and shall not subsequent to the bid opening be made
\n      responsive by the bider by correction of the non-conformity.\n<\/p>\n
      21.5 The purchaser may waive any minor infirmity or non-conformity <\/p>\n
      or irregularity in a bid which doesn’t constitute a material deviation,
\n      provided such waiver doesn’t prejudice the establishment of techno-
\n      commercial parity among the bids.\n<\/p>\n
      21.6 The financial bids of only those technical and commercial bids
\n      that are determined as substantively responsive shall be opened. The
\n      financial   bids   of   those   technical   and   commercial   bids   that   are
\n      determined as substantively non-responsive   shall be returned to the <\/p>\n
      respective bidders unopened.\n<\/p>\n
    51.In view of the above clause the challenge to the techno-commercial
\n      evaluation bid of the 3rd & 4th Respondents suffers from gross delay <\/p>\n
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\n                                              40<\/span><\/p>\n
      and latches. The petitioners allowed the tender process to   progress
\n      further and even the financial evaluation was made by the BSNL and <\/p>\n
      the   BSNL   determined   the   ranking   of   the   bidders.     In   view   of   this <\/p>\n
      position,   the   petitioners   cannot   be   allowed   to   challenge   techno-
\n      commercial evaluation of the 3rd & 4th Respondents. If we permit the
\n      challenges to be raised belatedly it would amount to petitioners taking <\/p>\n
      chance in the matter and permitting to grow grass under their feet
\n      and thereafter turn around and challenge the same.   We decline to <\/p>\n
      exercise our extra-ordinary jurisdiction in favour of the petitioners.\n<\/p>\n
    52.This takes us to the second ground of attack viz.failure  to quote the <\/p>\n
      amount of excise duty in col.5 & 6 of Section-VII of the financial bid.
\n      So far as this aspect is concerned, the petitioners rely upon clauses 9.1
\n      and 9.2 of Section-II and Query No.458 and the reply given by the <\/p>\n
      BSNL.  Clauses 9.1 & 9.2 of Section-II read as under:-\n<\/p>\n
      9.1.   The bidder shall give the total composite price inclusive of all <\/p>\n
      levies and taxes viz.excise duties, custom duty, VAT, sales tax, service
\n      tax,   packing,   forwarding,   freight   and   insurance   etc.,   but   excluding
\n      octroi\/entry   tax   which   will   be   paid   extra   as   per   actual,   wherever
\n      applicable  as per  the  terms of payment specified  in Section-IV. The
\n      basic   unit   price   and   all   other   components   of   the   price   need   to   be <\/p>\n
      individually indicated against the goods and services it proposes to
\n      supply under the contract as per the price schedule given in Section-
\n      VII.  Prices of incidental services should also be quoted. The offer shall
\n      be firm in Indian Rupees. No foreign exchange will be made available
\n      by the purchaser.\n<\/p>\n
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\n                                                41<\/span><\/p>\n
       9.2   Prices   indicated   in   the   Price   Schedule   shall   be   entered   in   the
\n       following manner:\n<\/p>\n
       (i)   The   basic   unit   price   (ex-factory   price)   of   the   goods,   excise
\n       duty\/custom   duty,   VAT,   sales   tax,   service   tax,   freight,   forwarding, <\/p>\n
       packing,   insurance   and   any   other   levies\/charges   already   paid   or
\n       payable by the supplier shall be quoted separately item wise.\n<\/p>\n
       (ii) The supplier shall quote as per price schedule given in section-VII
\n       for   all   the   items   given   in   the   schedule   of   requirement.   In   case   of
\n       imported items, a new column (4C) indicating the assessable value for
\n       calculation of customs duty may be inserted and the value entered in <\/p>\n
       that column shall be used for calculation of customs duty only.\n<\/p>\n
       Query No.458 and the Reply thereto reads as under:-\n<\/p>\n
       Query  No.458:  As  stated  in  price  schedule  ex-factory   price    is  unit
\n       price excluding levies and charges. Will the ex-factory price include
\n       sales tax paid, other costs, margins of supplier. Else where should such <\/p>\n
       components of cost and the margin be shown.\n<\/p>\n
       Reply: Basic unit price is exclusive of all levies and charges. Columns
\n       have   been   provided   for   excise   duty,   sales   tax   and   other   levies   and
\n       charges.\n<\/p>\n
    53.On   behalf   of   the   Respondents   it   is   submitted   that   the   3rd   &   4th
\n       Respondents do not manufacture any of the items listed in the tender.\n<\/p>\n
       They   are   also   not   producers   of   these   items.   As   per   clause   22.2   of
\n       Section-II of the tender (ITB), the evaluation and the comparison of
\n       the bids is to be made on the basis of net costs to the BSNL of the
\n       goods  offered inclusive of duties and taxes, but cenvatable duties and <\/p>\n
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\n                                               42<\/span><\/p>\n
      taxes  as indicated in col.17. Column 17 of the said format would be
\n      effective net costs   to the BSNL, after   getting credit\/benefit   for the <\/p>\n
      said cenvatable duties and taxes. Clauses 22.2(a) of Section-II reads <\/p>\n
      as under:-\n<\/p>\n
      “The evaluation and comparison of responsive bids shall be done on <\/p>\n
      the   basis   of   net   cost   to   BSNL   on   the   prices   of   the   goods   offered
\n      inclusive of duties and taxes (but excluding CENVAT-able duties and
\n      taxes), sales tax, packing, forwarding, freight and insurance charges
\n      etc., as indicated in Col.17 of the price schedule in the Section-VII, <\/p>\n
      Part-II   of   the   tender   document.   As   stipulated   in   clause-9.1,
\n      octroi\/entry taxes are not to be included in the composite price and <\/p>\n
      hence the same will not be considered for the purpose of evaluation
\n      and comparison of responsive bids. However, octroi\/entry taxes will <\/p>\n
      be paid extra as per actual, wherever   applicable, on production of
\n      proof of payment\/relevant invoices\/documents”.\n<\/p>\n
    54.It is further submitted that under the provisions of the Central Excise <\/p>\n
      Act<\/a> and Rules, it is the respective producer or the manufacturer who <\/p>\n
      has to  pay excise duty to the excise authorities. There is therefore no
\n      question of the Respondent Nos.3 & 4 failing or neglecting to fill in <\/p>\n
      col.5 & 6 of Section-VII (Part-II) dealing with the price schedule for
\n      indigenous equipments (including partly imported) and service costs
\n      and the price schedule for the imported equipments.\n<\/p>\n
    55.Having considered the rival submissions we are of the opinion that
\n      there   is   no   substance   in   the   challenge   put   forth   on   behalf   of   the
\n      petitioners that the bid of the 3rd & 4th Respondents are liable to be <\/p>\n
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\n                                               43<\/span><\/p>\n
      rejected   on   account   of   failure   to   quote   the   amount   of   excise   duty.
\n      Having regard to clause 22.2(a) of Section-II extracted hereinabove, <\/p>\n
      the evaluation and comparison of responsive bids is to be done on the <\/p>\n
      basis of net costs to BSNL on the prices of goods offered inclusive of
\n      duties and  taxes  (but  excluding  cenvatable  duties  and  taxes),  sales
\n      tax,   packing,   forwarding,   freight   and   insurance   charges   etc.,   as <\/p>\n
      indicated   in   col.17   of   the   said   format.   We   therefore   reject   the
\n      submission   made   by   the   petitioners   that   the   bid   of   the   3rd   &   4th <\/p>\n
      Respondents was misleading or manipulative on this count.\n<\/p>\n
    56.The petitioners relied upon the judgment  of the learned Single Judge <\/p>\n
      of Calcutta High Court in Writ Petition No.9770 (W) of 2009 in the
\n      case   of  KEC   International   Limited   &   Another   V\/s.Union  of  India  &
\n      Ors.,   dated   July   8,   2009.     In  that   case   the   petitioners   assailed   the <\/p>\n
      evaluation of two of the bids received by the BSNL in respect of the <\/p>\n
      works   viz.   Planning,   engineering,   supply,   installation,   testing   and
\n      commissioning of infrastructure for 18 million lines of cellular mobile <\/p>\n
      expansion   project   phase-VI   in   East   Zone.   In   that   case   clause   4.7.2
\n      provided that the Engine Alternator   supplied should be of ready to
\n      use type (RTU), the BHP of engine may be suitably enhanced as per <\/p>\n
      site conditions in order to deliver the minimum required KVA at site.
\n      The Engine Alternators shall be of air cooled type. By Addendum No.4
\n      dated September 5, 2008 the tender dated May 1, 2008   and clause
\n      4.7.2 of the DTR of the Part-II   was modified.   It provided that the <\/p>\n
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\n                                          44<\/span><\/p>\n
    water cooled Engine Alternators   can also be supplied alongwith Air
\n    cooled   Engine   Alternators   in   the   ratio   30:70   respectively.     Similar <\/p>\n
    functionalities as asked for Air Cooled Engine Alternators apply for the <\/p>\n
    water cooled Engine Alternators as well.       By Addendum 4.2 dted
\n    September 6, 2008 the revised consolidated SOR for Par-3 was given.
\n    The   petitioners   therein   contended   that   the   Addendum   dated <\/p>\n
    September 6, 2008 altogether altered the SOR and provided that the
\n    equipment   and   quantities   indicated   in   such   revised   SOR   would   be <\/p>\n
    what the bidders had to quote for. On the other hand the BSNL and
\n    the contesting Respondents contended that nothing in the Addendum <\/p>\n
    dated   September   6,   2008   detracted   from   the   option   given   to   the <\/p>\n
    bidders   by  the   Addendum   published   on  September   5,   2008.     They
\n    submitted that it was open to the bidders to either quote for the entire
\n    complement of engine alternators as the air-cooled type or quote air-\n<\/p>\n
    cooled     and   water-cooled   engine   alternators   in   the   ratio   70:30   as <\/p>\n
    indicated by Addendum of September 5, 2008.\n<\/p>\n
    After exhaustively considering several judgments of the Apex Court,
\n    the learned Single Judge observed as under:-\n<\/p>\n
    “Clause   4.7.2   of   the   detailed   technical   requirement   specified   that
\n    engine   alternators   “shall   be   of   air   cooled   type”.     The   moment
\n    addendum 4 was published, the “shall be” in the second sentence of
\n    clause 4.7.2 had per force to be read as “may be”.  The argument of
\n    the   fourth   respondent   that   clause   4.7.2   was   not   subservient   to
\n    addendum  4.2   cannot  be   accepted   since   its  mandate   stood   already <\/p>\n
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\n                                            45<\/span><\/p>\n
    diluted   by   addendum   4   issued   on   the   previous   day.   There   is   an
\n    element of vagueness about addendum 4.   There is no doubt that it
\n    gave a choice to bidders to offer to supply water-cooled alternators <\/p>\n
    alongwith   air-cooled   ones.   Did   it   then   require   bidders   to   offer   to
\n    supply the full compliment in air-cooled  alternators or a combination <\/p>\n
    of   exactly   70:30   of   air-cooled   and   water-cooled   alternators   or   any
\n    combination of the two as long as air-cooled alternators did not fall
\n    below   70   percent     and   water-cooled   alternators   did   not  exceed   30 <\/p>\n
    percent?  If the air-cooled alternators are the more preferred, as both
\n    BSNL and the fourth respondent suggest, it would irrational that a
\n    bidder with an 80:20 mix of air-cooled alternators and water-cooled
\n    alternators would stand disqualified though it would appear to be a <\/p>\n
    better   offer   than   a   70:30   mix   of   air-cooled   and   water-cooled
\n    alternators.     But   is   is   unnecessary   to   get   into   such   issue   save   to <\/p>\n
    appreciate   the   nature   of   the   queries   that   may   have   been   raised
\n    following the obvious option given by Addendum 4.  The last sentence
\n    above the table in addendum 4 referred to modifications in the SOR <\/p>\n
    and the SOR being revised “in relation to Engine Alternators”. As a
\n    stand-alone sentence it would imply that the SOR in respect of engine
\n    alternators stood modified to the extent indicated in the table. But <\/p>\n
    since   such   sentence   followed   the   option   offered   earlier   in   the
\n    addendum for water-cooled alternators to also be supplied alongwith <\/p>\n
    air-cooled   alternators,   it   is   reasonable   to   read   the   modified   SOR
\n    relating   to   engine   alternators   in   addendum   4   to   permit   bidders   to
\n    offer to supply only air-cooled alternators as per the original SOR or a <\/p>\n
    mix of air-cooled and water-cooled alternators in accordance with the
\n    modification provided in such addendum.”\n<\/p>\n
    The learned Single Judge also considered clause 31 (v) of ITB and <\/p>\n
    observed thus:-\n<\/p>\n
    “Clause   31(v)   of   the   instructions   to   bidders   in   the   tender   papers
\n    provided that the failure of a bidder to fill in the prices as prescribed <\/p>\n
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\n                                                 46<\/span><\/p>\n
       in the price schedule would result in the rejection of the bid. Clause
\n       46, 2(vii) of the special conditions of contract stipulated that in case a
\n       bidder had not quoted the price of any item mentioned in the SOR <\/p>\n
       and had not justified for not quoting the same, the price bid was to be
\n       loaded with the maximum price quoted for that item by any other <\/p>\n
       bidder   for   the   purpose   of   evaluation.   It   is   true   that   the   tender
\n       documents gave BSNL some elbow room to exercise discretion to not
\n       reject   a   bid   on   a   technical   transgression.     But   as   much   as   BSNL’s <\/p>\n
       reasonable stand in not rejecting the petitioner company’s bid for it
\n       not quoting   for spares in its annual maintenance contract has to be
\n       applauded, its interpretation of addendum 4.2  cannot be appreciated.
\n       It is possible that BSNL understood addendum 4.2 to be as it suggest, <\/p>\n
       but that is of no importance. What is of consequence is as to how a
\n       reasonable bidder would understand addendum 4.2 to imply. For, the <\/p>\n
       document was intended for bidders and its interpretation lies in what
\n       it conveyed rather than what it intended to convey. The expression “to
\n       clear   it   all”   and   the   firm   finality   in   the   publication  of  “the   revised <\/p>\n
       consolidated SOR” would admit of no other construction but that it
\n       was such modified SOR that bidders had to adhere to.”\n<\/p>\n
    57.The learned Single Judge came to the conclusion that the process of
\n       evaluation   was   found   to   be   faulty   as   the   reasonable   bidder   would <\/p>\n
       have understood  the table appended to addendum 4.2 to be the final,
\n       and inviolable   schedule of requirements. The learned Single Judge <\/p>\n
       eventually issued writ of mandamus cancelling the evaluation of bids
\n       conducted   by   the   BSNL   with   a   direction   to   reassess   the   bids   by
\n       treating SOR published under addendum 4.2 as the applicable list of <\/p>\n
       materials and quantities thereof.\n<\/p>\n
    58.We   however   find   that   the   said   judgment   in   fact   supports   the
\n       contentions   raised   by   the   3rd   and   4th   Respondents   as   regards   the <\/p>\n
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\n                                               47<\/span><\/p>\n
       issue   of   spares.   The   learned   Single   Judge     appreciated   the   BSNL’s
\n       reasonable stand in not rejecting the petitioner Company’s bid therein <\/p>\n
       for not quoting for spares in its AMC.  The BSNL’s said stand   was in <\/p>\n
       fact applauded although the learned Single Judge did not appreciate
\n       interpretation of addendum 4.2.\n<\/p>\n
    59.The   petitioners   also   strenuously   relied     upon   the   judgment   of   the
\n       Apex Court in the case of West Bengal Electricity Board (supra) and in <\/p>\n
       particular paragraph  No.24 thereof,  for the  purpose of    contending
\n       that in a bid and the high value tender as the present one, the degree <\/p>\n
       of care required   is greater than in local bids for small works. The <\/p>\n
       Apex   Court   held   that   it   is   essential   to   maintain   the   sanctity   and
\n       integrity of the process of tender\/bid which should be filled in and the
\n       terms complied with scrupulously, and that adherence to instructions <\/p>\n
       under  ITB   cannot  be   given  a    go-bye   by branding  it  as a  pedantic <\/p>\n
       approach,   otherwise   it   would   encourage   and   provide   the   scope   for
\n       discrimination,   arbitrariness   and   favouritism   which   are   totally <\/p>\n
       opposed   to   the   rule   of   law   and   constitutional   values.     It   has   been
\n       further held therein that relaxation  of such rules in favour of one or
\n       the other bidder would impair the rule of transparency and fairness <\/p>\n
       and   provide   a   room   for   manipulation   in   picking   and   choosing   a
\n       bidder, which is not permissible in law for state authorities. In that
\n       case   the   Apex   Court   considered   the   clauses   of   the   tender   and   in
\n       particular clauses 14, 27 and 29 of the ITB as also the correspondence <\/p>\n
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\n                                             48<\/span><\/p>\n
    exchanged between the parties. Clause 24.3 of the ITB lays down that
\n    no   bid   shall   be   modified   by   the   bidder   after   the   deadline   for <\/p>\n
    submission of bids.  Clause 27 of the ITB dealt with the clarification of <\/p>\n
    the bids. It provided that the request for clarification and the response
\n    shall be in writing or by cable, but no change in the price or substance
\n    of   the   bid   after   opening   the   price   bid   shall   be   sought,   offered   or <\/p>\n
    permitted except as required to confirm the correction of arithmetical
\n    errors discovered by the employer’s authorised representative in the <\/p>\n
    evaluation   of   the   bids   in   accordance   with   clause   29   of   the   ITB.
\n    Clause 29 of the ITB provided the procedure for correction of errors.\n<\/p>\n
    The Court thereafter considered the nature of errors, corrections made
\n    by the appellant and the relief sought by the Respondents 1 to 4 in
\n    respect   of   37   items   in   the   bid   documents   and   observed   thus   in <\/p>\n
    paragraph Nos.16 and 17:\n<\/p>\n
       “16. A perusal of the price bid statement ‘A’ shows that the unit
\n       price filled in by the bidder in the first line against Item 02 – work
\n       item – “Rock Excavation” is repeated in two lines – in the second <\/p>\n
       line of the same item and in the first line of Item 03 – work item —
\n       “Impervious Core Embankment”.  In the quantity column, ‘1000’ is
\n       noted by the appellant. The unit rate for rock excavation is given by
\n       Respondents 1 to 4 in the first line in Indian Rupee as Rs.148.08 <\/p>\n
       both  in  figures  as well  as  in  words.    In  the   amount  column  Rs.
\n       148,077.97 is entered which is arrived at by multiplying quantity,
\n       1000, by unit rate, Rs.148.08.   It contains an arithmetical error;
\n       instead   of   Rs.1,48.080.00,   it   is   noted   as   Rs.1,48,077.97.     It   has
\n       been noticed above that under clause 29.1(b) of the ITB, such an
\n       error   in   the   line   total   in   the   amount   column   is   amenable   for <\/p>\n
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\n                                             49<\/span><\/p>\n
       correction and not the unit rate noted by the bidder in  the figure
\n       column.  In the second line, the same entry is repeated though that
\n       line should contain unit rate in US Dollar which is rupee equivalent <\/p>\n
       of the unit rate mentioned in the first line. Respondents 1 to 4 seek
\n       correction   of   ‘148.08’   in   the   second   line   as   ‘3.38’   in   the   figure <\/p>\n
       column and also in words to conform to 3384.64 which is noted in
\n       the amount column to wit as US Dollar equivalent of 1,48,077.97
\n       Indian Rupee in the first line. This appears to be the import of their <\/p>\n
       letter of 17.12.1999.”\n<\/p>\n
       “17. Respondents 1 to 4 seek correction of the entries in the third
\n       line also which is the first line against work item “Impervious Core <\/p>\n
       Embankment”. It is plain that against this work item the entires in
\n       the   first   line   are   quite   different.     The   quantity   column   is   blank, <\/p>\n
       though ‘3900’ should have been noted therein. In that line also the
\n       entires in the first line are repeated. There the correction sought is
\n       that   the   figure   column   should   read   as   84.21   both   in   figure   and <\/p>\n
       words. It is stated that in the second line the unit rate 1.92 both in
\n       figures and words, represents US Dollar equivalent of 84.21 Indian
\n       Rupee which is now sought to be inserted. The errors in the other <\/p>\n
       36 items are said to be similar. Had the errors been confined to
\n       these aspects, it would not have resulted in material change in the <\/p>\n
       unit rate because the unit rate in one of the permissible currencies
\n       is correctly given and there will be no discrepancy as envisaged in
\n       sub-clause   (b)   of   clause   29.1.   It   would   not   really   be   a   case   of <\/p>\n
       incorporating  a  new   unit   rate   but   a  case   of  either  recording   US
\n       Dollar equivalent of the unit rate already noted in Indian Rupee or
\n       vice versa as given in statement ‘B’ above. In such a case, perhaps,
\n       they would have been entitled to equitable relief of rectification of
\n       mistake.   But   here,   as   would   be   shown   presently,   the   position   is <\/p>\n
       different.”\n<\/p>\n
    After considering the correspondence exchanged between the parties,
\n    the   Court   observed   that   the   corrections   in   the   bid   documents   of
\n    Respondent Nos.1 to 4 carried out by the appellant, evaluation of bid <\/p>\n
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\n                                           50<\/span><\/p>\n
    under clause 29.2 and the impugned communication of the appellant
\n    dated December 18, 1999 were unsustainable and of no consequence <\/p>\n
    by observing in paragraph Nos.21 and 22 as under:-\n<\/p>\n
      “21. The appellant could not have ignored these letters. Had the
\n      appellant taken note of these letters and the mistakes occurring due <\/p>\n
      to repetition of entries in 37 items in the bid documents, it would
\n      not   have   proceeded   with   correction   of   such   mistakes   and
\n      evaluation   of   their   bid   without   first   seeking   clarification   from
\n      Respondents 1 to 4 under clause 27.1. We have already referred to <\/p>\n
      the gist of that clause. The only prohibition contained therein is
\n      that   no   change   in   the   price   or   substance   of   the   bid   after   its <\/p>\n
      openings can be sought, offered or permitted. In that regard they
\n      had   made   their   position   clear.   The   prohibition   is,   therefore,   not
\n      attracted.   In   these   circumstances   any   reasonable   person   in   the <\/p>\n
      position   of   the   appellant   would   have   sought   clarification   from
\n      Respondents 1 to 4 under clause 27.1.   Even assuming that after
\n      the letter of 17.12.1999, no further clarification was required to be <\/p>\n
      sought by the appellant, we cannot but hold that correction of the
\n      errors taking note of the unit rates which are mere repetition of the <\/p>\n
      unit   rates   quoted   for   a   different   work   item,   is   mechanical   and
\n      without application of mind by the appellant. In our view such a
\n      correction   is   far   beyond   the   scope   of   clause   29.   From   the <\/p>\n
      description of the mistakes, noted above, and the correction and
\n      evaluation made by the appellant, it is evident that except the error
\n      in   the   first   line   against   the   work   item   “Rock   excavation”   and
\n      Schedule   ‘N’  day   work,   all   other  mistakes\/errors  are   beyond   the
\n      scope of clause 29.1, so clasue 29.2 will not be attracted.  It follows <\/p>\n
      that the corrections in the bid documents of Respondents 1 to 4
\n      carried out by the appellant, evaluation of bid under clause 29.2
\n      and   the   impugned   communication   of   the   appellant   dated
\n      18.12.1999 are unsustainable and of no consequence.”\n<\/p>\n
      “22.   Now,   reverting   to   the   relief   of   correction     of   errors, <\/p>\n
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\n                                             51<\/span><\/p>\n
      Mr.Chidambaram has argued that in the two lines against each of
\n      the work items, the first line denotes 50 percent of the quoted unit
\n      rate in Indian Rupees and the second line represents the other 50 <\/p>\n
      percent of the unit rate in US Dollars. According to him the actual
\n      rate quoted for quantity 1000 is the sum total of the two lines i.e.<\/p>\n
      148.08 in Indian Rupees plus 3.38 in US Dollars.  This is not noted
\n      either   in   Statement   ‘A’   or   in   Statement   ‘B’.     Be   that   as   it   may,
\n      quoting the unit rate 50 percent in Indian Rupees and 50 percent in <\/p>\n
      US Dollars is not provided for in the ITB.  Nothing is brought to our
\n      notice   to   justify   splitting   of   unit   rate   in   that   ratio.   There   is   no
\n      indication of this fact in the price bid documents submitted by the
\n      said respondents to explain that the unit rate has been so quoted.\n<\/p>\n
      This is also not in conformity with clause 15 of the ITB which, as
\n      noted above, requires a bidder to quote  unit rates  and prices  in <\/p>\n
      Indian   Rupees   and   either   in   US   Dollars   or   Japanese   Yen.   The
\n      learned   Additional   Solicitor   General,   in   our   view,   is   right   in   his
\n      submission   that   till   the   representation   was   made   by   the   said <\/p>\n
      respondents on 23.12.1999, after the interim direction of the High
\n      Court, the appellant was unaware of the quoted unit rate being in
\n      such proportion. A combined reading of the ITB and the annexure, <\/p>\n
      extracted above, makes it clear that the second line against each
\n      work   item   is   meant   for   writing   US   Dollar   or   Japanese   Yen <\/p>\n
      equivalent of the “unit rate and line total in the amount column”
\n      entered in the first line and not for writing bifurcated unit price in
\n      different currencies in the ratio of 50:50. On these facts, the errors <\/p>\n
      cannot   be   termed   as   mere   clerical   or   mechanical.   Permitting
\n      correction of such errors, if they can be so called, would result in
\n      not only rewriting unit rates in 37 entries in which such errors are
\n      said to have been committed but also  appending an explanation
\n      thereto regarding splitting of unit rates in terms of representation <\/p>\n
      dated 23.12.1999 of Respondents 1 to 4. Neither clause 27 and 29
\n      nor any other clause in ITB permits such corrections.”\n<\/p>\n
    On facts the Apex Court considered that the errors committed by the <\/p>\n
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\n                                                    52<\/span><\/p>\n
       Respondent   Nos.1   to   4   cannot   be   termed   as   mere   clerical   or
\n       mechanical.  Permitting correction of such errors would result in not <\/p>\n
       only rewriting unit rates in 37 entries in which such errors are said to <\/p>\n
       have   been   committed,   but   also   appending   an   explanation     thereto
\n       regarding   splitting   of   unit   rates   in   terms   of   representation   dated
\n       December 23, 1999 of Respondent Nos.1 to 4.  Neither clauses 27 and <\/p>\n
       29 nor any other clause in ITB permitted such corrections.\n<\/p>\n
    60.In so far as the controversy in the present case is concerned, we have
\n       already   held   that   the   Respondent   Nos.3   &   4   have   not   committed <\/p>\n
       breach of any of the clauses stipulated in clause 31 of the tender. The <\/p>\n
       judgment   of   the   Apex   Court   in   the   case   of   West   Bengal   Electricity
\n       Board   (supra)   is   not   applicable   to   the   controversy   raised   in   the
\n       present case.\n<\/p>\n
    61.In the result the petition fails. Rule is discharged with no order as to
\n       costs.   Since   we   have   proceeded   to   hear   the   Chamber   Summons <\/p>\n
       alongwith the main petition, no separate orders are necessary in the
\n       Chamber  Summons and the same stands disposed  off.\n<\/p>\n
                                                                 (A.M.KHANWILKAR, J.)<\/p>\n
                                                                     (R.G.KETKAR, J.)<\/p>\n
                                                                      ::: Downloaded on – 09\/06\/2013 15:14:14 :::<\/span>\n <\/p>\n","protected":false},"excerpt":{"rendered":"
Bombay High Court Acme Tele Power Limited vs Union Of India on 16 October, 2009 Bench: A.M. Khanwilkar, Rajesh G. Ketkar 1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO.1492 OF 2009 WITH CHAMBER SUMMONS NO.296 OF 2009 IN WRIT PETITION NO.1492 OF 2009 1. ACME Tele Power […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[11,8],"tags":[],"class_list":["post-258529","post","type-post","status-publish","format-standard","hentry","category-bombay-high-court","category-high-court"],"yoast_head":"\nAcme Tele Power Limited vs Union Of India on 16 October, 2009 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/acme-tele-power-limited-vs-union-of-india-on-16-october-2009\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Acme Tele Power Limited vs Union Of India on 16 October, 2009 - 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