It is held that the petitioner has miserably failed to make out a case for interference in exercise of extra-ordinary jurisdiction under Article 226 of the Constitution of India within the four corners of law and yardsticks set out by Their Lordships of the Supreme Court in the above-quoted judgements (supra) qua interference in contractual matter. We accordingly, hold that there is no reason to exercise the power of judicial review in this instant matter, as the petitioner has not been able to demonstrate arbitrariness, unfairness, illegality, irrationality or unreasonableness in the impugned decision of rejecting its technical bid and awarding rate contract to respondent No. 3.
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1. Invoking jurisdiction of this Court under Article 226 of the Constitution of India and impugning legality, validity and correctness of memo dated 10-3-2016 (Annexure P-1) issued by respondent No. 1 whereby tech-commercial bid of the petitioner has been rejected assigning reasons, the petitioner herein, a company incorporated and registered under the provisions of the Indian Companies Act, 1956, has filed this writ petition. The petitioner herein also seeks to challenge memo dated 8-4-2016 (Annexure P-2) whereby the State Government has rejected the representation of the petitioner made pursuant to Annexure P-1 and the petitioner consequently seeks quashment of order Annexure P-11 whereby respondent No.1 has signed Rate Contract with respondent No. 3 and issued purchase order dated 26-5-2016 directing supply of 16,819 quantity of Laptops Model No.HP 245 G4 and the net value of supply is ₹ 29,41,64,310.00 (Rupees twenty nine crores forty one lakhs sixty four thousand three hundred and ten only).
Facts leading to petition
2. Shorn of all paraphernalia, essential facts requisite to adjudicate the legal dispute brought before us in nutshell are as under: –
2.1) Respondent No. 1 floated a global NIT / Request for Proposal inviting bid(s) from reputed bidders on 27-1-2016 (Annexure R-1) in which the subject matter in controversy relates to item No .2 – NIT 02/CYSKY/ DTE/LAPTOP/2016 with regard to empanelment of agency for supplying and commissioning of Laptops for students in the State of Chhattisgarh under the Chhattisgarh Yuva Soochana Kranti Yojana and a copy of Request for Proposal (RFP) has been filed as Annexure P-3. Clause 7 of the Request for Proposal – Bid Submission, states that the tech-commercial bid sealed in one envelope should be marked as “Tech-commercial Bid” and shall contain technical details of the items quoted and also provide full details of deviations, if any, from the technical specification mentioned. The bidder should fill-up the format given in Annexure-I of the tender documents. Thereafter, 3-2- 2016 was fixed for pre-bid query and on the same day, later point of time, at 3 p.m., pre-bid conference was held and prebid response was published on 5-2-2016 on website and subsequent to issuance of RFP in relation to ANNEXURE ‘A’, a pre-bid clarification was issued on 12-2-2016 pursuant to pre-bid response from the Directorate of Technical Education and pre-bid meeting was held as stated on 3-2-2016. Technical bids for participating in the RFP were submitted on 25-2-2016 as per corrigendum dated 12-2-2016. In response to the NIT and subsequent corrigendum No. 2, three bids in response to the RFP and two bids in response to the corrigendum were received from the petitioner, respondent No. 3 herein namely M/s. Hewlett Packard India Sales Pvt. Ltd., and respondent No. 4 M/s. HCL Info systems Ltd..
2.2) It is the case of the petitioner that on 25-2-2016, tech commercial bid was opened and it was sent for evaluation to the specification committee and on 1-3-2016, respondent No. 2 herein sought clarification about the launching of processor in Q1-2016 and BIS certificate which was replied by the petitioner on 3-3-2016, and on 8-3-2016, financial bids of two bidders i.e. respondents No.3 and 4 were opened which was not informed to the petitioner. It is the further case of the petitioner that unofficially, the petitioner came to know about the opening of price bid and sent e-mail seeking confirmation as to why the petitioner’s bid was not considered as it was eligible, vide Annexure P-8 and in response to the e-mail dated 9-3-2016, for the first time, the petitioner was intimated the reasons, vide Annexure P-1, for rejection of its techcommercial bid against which the petitioner made various representations including representations Annexures P-9 and P-10. Ultimately, the representations were rejected vide Annexure P-2 dated 8-4-2016 and communication was sent to the petitioner vide Annexure P-2 by respondents No. 1 and 2.
2.3) Thereafter, the petitioner has filed the instant writ petition questioning rejection of its tech-commercial bid as well as the order rejecting its representation vide Annexure P-2 and also the order Annexure P-11 dated 26-5-2016 by which purchase order has been issued to respondent No.3 for supply of Laptops.
2.4) The petitioner herein has filed this writ petition mainly on the ground that rejection of its tech-commercial bid is illegal, arbitrary and legally unsustainable in law as the five reasons recorded for rejecting its tech-commercial bid are non-existent and contrary to record. It has further been claimed that the tendering process and particularly the decision making process disqualifying the petitioner and rejecting its tech commercial bid is arbitrary and illegal based on the grounds which were not part of the tender conditions. The reasons for rejection are either not the requirement of tender conditions and outcome of deviation by the tender committee to reject the petitioner’s bid and thus, vitiates the tender process. It has further been pleaded that the tender committee without application of mind and without there being prior technical evaluation has in a mechanical manner rejected the petitioner’s technical bid holding it to be technically inferior and the finding arrived at by the tender committee or specification laying committee is per se illegal and unsustainable in view of the certification given by the manufacturer i.e. Intel Technologies which manufactures the processor both N 3540 A 1020. It has also been pleaded that non-supply or disclosure of the material on the basis of which it has been held that processor A 1020 is not equivalent or higher than the benchmark processor, itself renders the process and decision vitiated. The clarification sought vide communication dated 1- 3-2016 was not precise. The disqualification and rejection is on the ground for which there was no specific clarification and hence there has been violation of the principles of natural justice apart from deviation from the stipulated process of tendering. The action of respondent No. 2 in rejecting the petitioner’s tech-commercial bid is discriminatory and is violative of Article 14 of the Constitution of India, and rejection of bid of the petitioner on the ground of non-submission of BIS certificate, two DIMM is not sustainable as it is not part of the tender conditions and factually non-existent and thus, the petitioner has sought quashment of Annexures P-1, P-2 and P-11.
3. The State/respondents No. 1 and 2 have filed their joint return stating inter alia that after pre-bid clarification, bids were submitted by the petitioner as well as respondents No. 3 and 4. The bids were considered by the Specification Committee constituted for implementation of ambitious project of purchase and distribution of Laptop and Tablet. Thereafter, the recommendations were placed before the Tender Committee and in turn, before the Purchase Committee duly constituted on 7-1-2016 and technical bids were opened on 25-2-2016 at 4 p.m. in presence of all the bidders. After opening of technical bids, technical bids of all the bidders in response to the RFP were sent to the Specification Committee along with technical bids of two other bidders. It is also pleaded that based upon evaluation and opinion of the Specification Committee after detailed analysis as per Annexure R-3, the Tender Committee recommended that the bid submitted by the petitioner is not meeting the requisite criteria therefore, the bid may be rejected and the Tender Committee also recommended that the price bid of two bidders namely respondents No.3 and 4 may be opened. It is also the case of respondents No.1 and 2 that meeting of the Purchase Committee was held on 4-3-2016 and based upon the opinion of the Specification Committee and the recommendation of the Tender Committee, the Purchase Committee in the meeting of the Inter Departmental Purchase Committee, recommended the opening of financial bids of technically short listed bidders namely M/s. HCL Info systems Ltd., and M/s. Hewlett Packard India Sales Pvt. Ltd., Pune. It was also pleaded that based upon the recommendations of the Inter Departmental Purchase Committee, financial bids of technically short listed bidders, as mentioned above, were opened and in the price bid, respondent No.3 herein was found to be the lowest bidder. Thereafter, e-mail dated 9-3-2016 was received from the petitioner Company seeking reasons for not considering and rejecting the tech-commercial bid. Though there is no condition in the RFP / tender documents with regard to intimation about non-qualification in technical bid, however, by the impugned e-mail dated 10-3- 2016 (Annexure P-1), reasons for rejection of the petitioner’s technical bid were communicated, but the petitioner remained unsatisfied and sent various e-mails dated 10-3-2016, 14-3- 2016, letter dated 4-3-2016, and other three e-mails were sent by the Zonal Business Manager of the petitioner Company. All the e-mails received from the petitioner were referred to the Specification Committee for impartial evaluation and the Specification Committee considered the objections / representations of the petitioner and along with reasons a detailed communication was sent to the petitioner Company vide the impugned communication Annexure P-2. A pointwise observation on the ground of which the technical bid of the petitioner Company has been rejected, has been filed with the return as Annexure P-7. It has also been submitted that after opening of price bid from amongst the technically short listed parties, a rate contract has been entered into vide contract agreement Annexure R-8 and as such, the writ petition deserves to be dismissed.
4. Respondent No. 3 has also filed return supporting the State action particularly, stating that in the matter of prescribing condition for tender, evaluation of technical bids and other process of scrutiny, the scope of interference is limited. It has been submitted that the petitioner’s bid has rightly been rejected due to non-fulfilment of conditions prescribed in the tender documents.
5. Rejoinder has been filed by the petitioner on 23-7-2016 after the return was filed by respondents No. 1 and 2 stating inter alia that though jurisdiction and authority to take decision on the tender, rests solely with the Purchase Committee, the minutes of meeting of the Purchase Committee do not reflect acceptance of recommendations of the Tender Committee for rejecting the technical bid of the petitioner and therefore, rejection and disqualification of the petitioner’s technical bid is rendered invalid and without jurisdiction. It has also been pleaded in the rejoinder that the grounds assigned for rejecting the petitioner’s technical bid, as stated in the writ petition, to be not in accordance with the technical specifications provided in the tender documents, have not been rebutted by the respondents by filing any cogent material and the Tender Committee has taken into consideration the irrelevant facts which are not part of mandatory conditions expressed in the RFP or NIT and which clearly indicate arbitrariness, illegality and also demonstrated differential unfair treatment with a view to oust the petitioner in furtherance of premeditated decision.
6. Thereafter, on 5-8-2016, an additional return has been filed on behalf of the State/respondents No. 1 and 2 and it has been submitted that the Tender Committee has only given recommendations by using the words “may be” for rejecting the bid of the petitioner and accepting the bids of private respondents. The Inter Departmental Purchase Committee has taken a decision and thereafter, financial bids of technically short listed bidders were opened. The whole process was impartial, transparent and as per the procedure prescribed under the law for evaluation of bids. The petitioner has failed to point out any flaw in the evaluation process and has made a bald allegation without any substantial basis. The bid of the petitioner was rejected on the basis of tender documents and experts had evaluated the same. It has also been stated that as far as comparison of processor category, BIS clarification and DIMM slot is concerned, all these facts have already been answered by respondents No.1 and 2 in the return filed. It has been specifically submitted that in the pre-bid clarification, it was specifically mentioned that two DIMM slots have to be provided and the petitioner instead of providing two DIMM slots was in an attempt to submit its tender without two DIMM slots and made communication also that it will provide one DIMM slot instead of two DIMM slots. This fact would show that the petitioner was not fulfilling the condition of two DIMM slots and therefore, his technical bid has rightly been rejected by respondents No.1 and 2.
7. Thereafter, on 22-8-2016, additional rejoinder has been filed on behalf of the petitioner stating therein that finding and conclusion arrived at by the Tender Committee in respect of Processor is also factually incorrect, arbitrary and illegal, as there was no clarification sought from the petitioner in respect of the Processor being shown in the Desktop category. The tabular comparison drawn by the Tender Committee is factually incorrect.
8. No further additional return was filed on behalf of either of the respondents.
Contentions
9. Mr. Abhishek Sinha, learned counsel appearing for the petitioner impugning the action of the State/respondents No. 1 and 2 in rejecting the tech-commercial bid disqualifying the petitioner from further tender process, would submit that the action of respondents No. 1 and 2 is totally arbitrary, illegal and factually incorrect and not based on record. He would further submit that the Purchase Committee, which is, according to the Government, competent to take decision on the bids in its meeting dated 4-3-2016 failed to take any decision with regard to the petitioner’s technical bid, as no reasons have been recorded for rejecting the technical bid of the petitioner and has only recommended to open the financial and price bids of respondents No. 3 and 4 as such, the Purchase Committee has failed to perform its duty in accordance with law and rejection of the petitioner’s bid without recording any reason and without passing any express order is bad and contrary to law. He would also submit that the five reasons which have been recorded for rejecting the petitioner’s representations are either not the requirement of conditions of tender or outcome of deviation by the Tender Committee to reject the petitioner’s bid and thus, vitiates the entire tender process and its evaluation. He would further submit that respondents No.1 and 2 did not provide an opportunity to the petitioner to make submission and clarify about the cause for which it rejected the petitioner’s bid, on the other hand, it not only relaxed the mandatory conditions of tendering process, but it also permitted rectification and clarification of documents mandatorily required for establishing eligibility and specification, and thus extended unequal discriminatory treatment violating the doctrine of ‘level playing field’ and thereby vitiating the decision making process and the consequent decision. He also submits that the action of respondent No.2 is discriminatory and violative of Article 14 of the Constitution of India, as respondent No.2 has shown very liberal approach in respect of respondent No. 4 in allowing time to rectify the defects and regularised the mandatory requirement. The representations filed by the petitioner were arbitrarily rejected and respondents No.1 and 2 have illegally proceeded and qualified respondent No.3 and also issued rate contract and thereafter placed supply order Annexure P-11 to respondent No. 3. He heavily relied upon the judgements of the Supreme Court in the matters of Tata Cellular v. Union of India, Reliance Energy Ltd. & another v. Maharashtra State Road Development Corporation Ltd. & others and Dutta Associates & others v. Indo Mercantiles Pvt. Ltd. & others.
10. Countering and replying the contentions made on behalf of the petitioner, Mr. Prafull Bharat, learned Additional Advocate General appearing on behalf of the State/respondents No. 1 and 2, would vehemently submit that the bids submitted by the petitioner as well as respondents No. 3 and 4 were considered in just, fair and transparent manner by multi-layered committees. Firstly, technical bids of the petitioner as well as respondents No. 3 and 4 were placed before the Specification Committee after opening it on 25-2-2016 at 3.30 p.m. and thereafter, taking into account the evaluation made by that Committee, the Tender Committee considered and recommended that the bid submitted by the petitioner is not meeting the requisite criteria therefore, the bid may be rejected and the Tender Committee also recommended the price bids of respondents No. 3 and 4 to be opened. The recommendation made by the Tender Committee was accepted by the Purchase Committee and accordingly, financial bids of technically short listed bidders were opened and price of respondent No. 3 was found to be lowest and thus, it was granted rate contract, as such, there is no procedural illegality in the entire evaluation process. Technical bids of eligible bidders were considered firstly by the Specification Committee and secondly by the Tender Committee, and ultimately, final decision was taken by the Purchase Committee which is a high level committee consisting of technical experts and as such, there is no technical / procedural violation in the entire decision making process and therefore, no interference is warranted in exercise of entire decision making process. The petitioner was supplied with the reasons for rejection of its bid and representation received thereafter was referred to the Specification Committee and the Specification Committee duly considered the point raised elaborately which was duly accepted by the State Government and thereafter, communicated to the petitioner as such, there is no infirmity in the decision making process of the tender proceedings and the writ petition deserves to be dismissed.
11. Mr. J.K. Gilda, learned Advocate General appearing on behalf of the State of Chhattisgarh, would additionally submit that the decision to reject the technical bid of the petitioner has been taken by the multi-layered committees consisting of experts and no interference is required by in the decision of experts even if two views are possible.
12. We have heard learned counsel for the parties at considerable length and carefully considered their rival submissions made herein-above and gone through the record thoroughly and extensively.
Bid proceedings and their evaluation
13. In order to appreciate the subject matter in dispute and to judge the correctness of the pleas raised at the Bar it would be advantageous to notice the relevant facts relating to issuance of Request for Proposal and leading to award of contract to respondent No. 3 which are as under:-
(i) “Chhattisgarh Yuva Soochana Kranti Yojana” is a project launched by the Department of Information and Technology, Government of Chhattisgarh for distribution of Laptop/Tablet (free of cost) to the eligible final year students undergoing studies in the technical colleges of State including Medical and Engineering colleges as well as the students of Commerce, Arts and Science, so that they may increase their knowledge and uplift their career and also to enhance the use of Computer and Internet in the State of Chhattisgarh and thereby contribute to the socio – economic development of the State.
(ii) In order to secure the Laptops for distribution under such a project, Global NIT request for proposal inviting bids from reputed bidders was issued on 27-1-2016 by the Government of Chhattisgarh through the Directorate of Technical Education with regard to agency for supply and commissioning of Laptops for students under the above-stated project. The request for proposal dated 27-1-2016, NIT No.2 which is subject matter of this writ petition states as under:-
“Government of Chhattisgarh
Directorate of Technical Education
3rd Block, 3rd & 4th Floor, Indravati Bhawan, Naya Raipur
Request For Proposal
Date 27/01/2016
Directorate of Technical Education, Government of Chhattisgarh (DTE) invites below Global Notice Inviting Tender (NIT) from reputed bidders:
