Judgment
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE V.G.ARUN THURSDAY, THE 1ST DAY OF SEPTEMBER 2022 / 10 TH BHADRA, 1944 WP(C) NO. 28351 OF 2022 PETITIONER/S:
P.SHYAM RAJU AGED 58 YEARS S/O PADMANABHAN, PROPRIETOR, SKILDERZ DEVELOPERS, RESIDING AT ARJUNAM 27/355, THIRUVAMPADY P.O, ALAPPUZHA, PIN-688002.
BY ADVS.
K.V.SREE VINAYAKAN K.M.MUHAMMED HUSSAIN COLIN ALEX RESPONDENT/S:
1 KERALA MINERALS AND METALS LIMITED SANKARAMANGALAM, CHAVARA, KOLLAM, KERALA, 691583, REPRESENTED BY ITS MANAGING DIRECTOR.
2 THE MANAGING DIRECTOR, KERALA MINERAL AND METALS LTD, SANKARAMANGALAM, CHAVARA, KOLLAM, KERALA, 691583.
3 DEEPTHI TRANSPORT SERVICE, IRE ROAD, VADAKADAM BUILDING, KARITHURA, CHAVARA.P.O, KOLLAM, PIN-691583.
OTHER PRESENT:
SC for r1, 2 Latha Anand, Adv Nandagopal Nambiar for Addl. R3 THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 01.09.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
WP(C) NO. 28351 OF 2022 2 JUDGMENT Dated this the 1st day of September, 2022 The petitioner had participated in the tender floated by respondents 1 and 2 for the work 'highly mechanised collection, loading and transportation of mineral, sand in (rear dump trucks) from north side of Thottappallil Spillway Channel and Pozhi Mouth site to the premises of TP/TSP units of KMML & IREL, Chavara'. Only three bidders responded to the notice inviting tender. From among the three, the petitioner and the another bidder were disqualified, leaving only the third respondent in the fray. This writ petition is filed contending that there being only one successful bidder, respondents 1 and 2 are bound to conduct a retender.
2.
Adv.Colin Alex, learned Counsel for the petitioner submitted that, as per the Manual For Procurement Of Works issued by the Central Vigilance Commission, when there is only one bidder in the tender , the employer is bound to conduct a retender. It is
WP(C) NO. 28351 OF 2022 3 contended that there is difference of Rupees 55 lakhs between the petitioner’s offer and that of the third respondent.
3.
Learned Standing Counsel for respondents 1 and 2 submitted that there is no such mandate in the guidelines as pointed out by the petitioner. Reference is made to Clause 5.6.7.which is extracted here under:- 5.6.7 Consideration of Lack of Competition Sometimes, against advertised/limited tender cases, the procuring entity may not receive a sufficient number of bids and/or after analysing the bids, ends up with only one responsive bid – a situation referred to as ‘Single Offer’. As per Rule 21 of DFPR (explanation sub-para), such situation of ‘Single Offer’ is to be treated as Single Tender.
The contract may be placed on the ‘Single Offer’ bidder provided the quoted price is reasonable.
However restricted powers of Single tender mode of procurement would apply. Before retendering, the procuring entity is first to check whether, while floating/issuing the enquiry, all necessary requirements and formalities such as standard conditions, industry friendly specification, wide
WP(C) NO. 28351 OF 2022 4 publicity, sufficient time for bidding, and so on, were fulfilled. If not, a fresh enquiry is to be issued after rectifying the deficiencies. It has become a practice among some procuring entities to routinely assume that open tenders which result in single bids are not acceptable and to go for retender as a safe course of action. This is not correct. Re-bidding has costs: firstly the actual costs of retendering; secondly the delay in execution of the work with consequent delay in the attainment of the purpose for which the procurement is being done; and thirdly the possibility that the re-bid may result in a higher bid. Lack of competition shall not be determined solely on the basis of the number of bidders. Even when only one bid is submitted, the process may be considered valid provided following conditions are satisfied.
i) The procurement was satisfactorily advertised and sufficient time was given for submission of bids;
ii) The qualification criteria were not unduly restrictive; and iii) Prices are reasonable in comparison to market values.
However restricted powers of Single tender
WP(C) NO. 28351 OF 2022 5 mode of procurement would apply. In case of price not being reasonable, negotiations (being L1) or retender may be considered as justifiable.
Unsolicited offers against LTEs should be ignored, however Ministries/Departments should evolve a system by which interested firms can enlist and bid in next round of tendering.
4. It is further submitted that, as of now, the tender has not been finalised and negotiations are being conducted with the third respondent. It is pointed out that the subject work has to be carried out immediately since it pertains to desiltation of the Thottappillil Spillway. Any delay in the process will lead to flooding and other issues.
5. Adv. Nandakumar Nambiar appearing for the third respondent supported the arguments of the Standing Counsel and submitted that it is the prerogative of the employer to decide whether to award the tender in favour of the third respondent and the court may not intervene in the tender process at the instance of a disqualified bidder.
6.
Having heard the learned Counsel on either side
WP(C) NO. 28351 OF 2022 6 and having carefully gone through the clause extracted above, I am of the considered opinion that there is no mandatory requirement of a retender whenever there is only a single bidder, participating or remaining after pre- qualification. The provision shows that discretion is vested with the employer to decide whether to go for a retender or to hold a negotiation with the remaining bidder. The requirement of retender is only in cases where the offer of the remaining bidder's offer is not reasonable.
7. Learned Standing Counsel having made it clear that negotiations are being conducted and final decision to award tender in favour of the third respondent is yet to be taken, I find no reason to interfere with the process.
The Writ Petition is accordingly dismissed.
Sd/- V.G.ARUN JUDGE RK
WP(C) NO. 28351 OF 2022 7 APPENDIX OF WP(C) 28351/2022 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF GST REGISTRATION OF THE PETITIONER EXHIBIT TRUE RESPONDENT .
Exhibit P2 TRUE COPY OF TENDER NO. OF THE KMML/MS/MINES/TPLY/16/2022-23 DATED 5- 8-2022 ISSUED BY 1ST RESPONDENT.
Exhibit P3 TRUE COPY OF THE WORK ORDER NO.MS/WO/MNS/0124/2021-22 DATED 10-12- 2021 ISSUED BY THE 1ST RESPONDENT.
Exhibit P4 THE TRUE COPY OF THE TENDER SUBMITTED BY THE PETITIONER WITHOUT .
Exhibit P5 TRUE COPY OF THE SOLVENCY CERTIFICATE ISSUED BY THE STATE BANK OF INDIA, ALAPPUZHA BRANCH.
Exhibit P6 TRUE COPY OF THE COVERING LETTER SUBMITTED BY THE PETITIONER DATED 17-8- 2022 SUBMITTING A FRESH SOLVENCY CERTIFICATE.