Imperial Engineering Company vs. Kerala Industrial Infrastructure Development Corporation (Kinfra) - Kerala High Court, 22 October 2021

WP(C) NO. 7428 OF 2021 1 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE P.V.KUNHIKRISHNAN FRIDAY, THE 22ND DAY OF OCTOBER 2021 / 30TH ASWINA, 1943 WP(C) NO. 7428 OF 2021 PETITIONER/S: IMPERIAL ENGINEERING COMPANY 37/1634, IMPERIAL HOUSE, KALOOR-KATHRIKADAVU ROAD, COCHIN-682 017, REPERESENTED BY ITS PARTNER BINU JOHN. BY ADVS. JAGAN ABRAHAM M.GEORGE SRI.JAISON ANTONY SHRI.JUNAID K.B. RESPONDENT/S: 1 KERALA INDUSTRIAL INFRASTRUCTURE DEVELOPMENT CORPORATION (KINFRA) KINFRA HOUSE, TC NO.31/2312, SASTHAMANGALAM P.O., THIRUVANANTHAPURAM-695 010, REPRESENTED BY ITS MANAGING DIRECTOR. 2 KITCO LTD. REGISTERED OFFICE AT FEMITH'S, P.B.NO.4407, PUTHIYA ROAD, N.H. BYE-PASS, VENNALA COCHIN-682 028, REPRESENTED BY ITS MANAGING DIRECTOR. 3 KERALA STATE ELECTRICITY LICENSING BOARD HOUSING BOARD BUILDING, SANTHI NAGAR, THYCAUD, THIRUVANANTHAPURAM-695 001, REPRESENTED BY ITS SECRETARY. 4 AVE MARIA ENGINEERING MATHURUTHY P.O., NEDUMKUNNAM, KOTTAYAM, PIN-686 542 REPRESENTED BY MR. MELVIN TOM. BY ADVS. SHRI.P.U.SHAILAJAN, SC, KINFRA, R1 VIZZY GEORGE KOKKAT GOVERNMENT PLEADER, SMT.VIDYA KURIAKOSE SUNIL CYRIAC -R4 NITHIN GEORGE B.DEEPAK, R2 THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 22.10.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C) NO. 7428 OF 2021 2 P.V.KUNHIKRISHNAN, J -------------------------------------------- W.P.(C.) No.7428 of 2021 -------------------------------------- Dated this the 22nd day of October, 2021 JUDGMENT

The above writ petition is filed with following prayers : “i. Direct the respondents 1 and 2 to reject the bid of 4th respondent for lack of valid License/qualification as per Exhibit P-2 Tender condition. ii. Declare that the 1st respondent is statutorily obliged to accept tenders, only from bidders, who meets the eligibility criteria stated in the Exhibit P-2 Tender. iii. Issue a writ of mandamus or such other writ or direction compelling the respondents to consider the bid of the participants other than 4th respondent in finalizing the Work Order on the basis of Exhibit P-2 iv. Declare that the decision of respondents 1 and 2, to permit the participation of 4th respondent in the bid is illegal and arbitrary. AND v. Grant such other order or direction as this Hon'ble Court may deem fit and necessary, in the facts and circumstance of the case. “

The 1st respondent invited tender from contractors as per Ext.P2. The work mentioned in Ext.P2 is '11 KV power

WP(C) NO. 7428 OF 2021 3 distribution system' for KINFRA Industrial Park, Mattannur. As per Ext.P4 technical evaluation summary, the petitioner, 4th respondent and another satisfied the pre-qualification criteria and their price bids were decided to open on 10.3.2021. It is submitted that it is opened and the 4th respondent is L1. At this stage, this writ petition is filed with the prayers, which are quoted above.

Heard the learned counsel for the petitioner, the learned Standing Counsel for respondents 1 and 2 and the learned Government Pleader for the 3rd respondent. I also heard the counsel for the 4th respondent also.

The learned counsel for the petitioner reiterated his contention in the writ petition. The counsel takes me through clause 1(a) in Ext.P2 tender conditions and also takes me through Ext.P3, licence issued to the 4th respondent by the 3rd respondent. The counsel also takes me through paragraph Nos. 4 and 5 of the counter affidavit filed by the 3rd respondent. The counsel submitted that the 4th respondent is not eligible to submit tender in the light of clause 1(a) in Ext.P2. The

WP(C) NO. 7428 OF 2021 4 Government Pleader, who appeared for the 3rd respondent takes me through paragraph Nos. 4 and 5 of the counter affidavit filed by the 3rd respondent and submitted that the 4th respondent can do only the work related to KSEB, as per the licence. The counsel for the 1st respondent submitted that the work is similar to that of KSEB and that is why the tender submitted by respondent No.4 was accepted. The counsel for the 4th respondent submitted that Ext.P4 is the technical evaluation summary and the same is not even challenged by the petitioner. The counsel also takes me through clause 1(a) of Ext.P2 and submitted that the clause only says that the bidder should have valid 'A grade Electrical Contractor's Licence' issued by KSELB. The counsel submitted that admittedly, the licence issued to the 4th respondent is an A grade licence issued by KSELB. Simply because, in the licence it is stated that the 4th respondent can do only the work of KSEB, it cannot be said that the petitioner is not eligible to submit tender based on Ext.P2 tender notice. The learned Standing Counsel for the 2nd respondent submitted that he is supporting the contentions of

WP(C) NO. 7428 OF 2021 5 the 1st respondent and a counter affidavit is also filed. The counsel for the 4th respondent also submitted that after losing the bid, the tender conditions cannot be challenged by the petitioner.

I considered the contentions raised by the petitioner and the respondents. The short point to be decided is whether the the 4th respondent is eligible to submit the tender, in the light of clause 1(a) of Ext.P2. It will be better to extract clause 1 of Ext.P2. “1. Contractors

who

fulfill

the following requirements shall be eligible to apply. (a) The bidder should have valid 'A' grade Electrical contractors license issued by KSELB. And should also have valid GST, PAN, PF and ESI registration details. (b) Should have satisfactorily completed the works as mentioned below during the last Seven years ending last day of the month previous to the one in which tenders are invited. i. Three similar works each costing not less than Rs.118 Lakhs, or two similar works each costing not less than Rs. 177.50 Lakhs, or one similar work costing not less than Rs.237 Lakhs (Similar work means Supply, installation, testing and commissioning of 11KV Overhead Power Distribution system) The value of executed works shall be brought to current costing level by enhancing the actual value of

WP(C) NO. 7428 OF 2021 6 work at simple rate of 7% per annum; calculated from the date of completion to last date of receipt of applications for bids. (c) Should have average annual turnover of the bidder should not be less than Rs.296 lakhs during the three preceding financial years (2016-17,2017- 18,2018-19). (d) Should have a solvency of Rs. 118 Lakhs (Scanned copy of original solvency to be uploaded).”

The clause 1 says that the bidder should have valid A grade Electrical Contractor's Licence issued by KSELB. Ext.P3 is the licence issued to the 4th respondent. In Ext.P3, it is specifically stated that the licence is issued for installation of distribution transformer “(500KVA) HT/LT lines of KSEB Ltd. works only”. It is true that in page No.1 of Ext.P3, it is specifically stated that it is an Electrical Contractors' Licence class A. The 3rd respondent, who is the licensing authority filed a counter. It will be better to extract paragraph No.5 of the counter filed by the 3rd respondent. “5. It is submitted that the 4th respondent possess 'A' Grade licence CA 497 with a scope "Installation of distribution transformer (500 KVA). HT/LT lines of Kerala State Electricity Board Ltd/Licensee works only" and with its present scope, this licence holder can carry out only the works of Kerala State

WP(C) NO. 7428 OF 2021 7 Electricity Board Ltd/any other similar licensee and license holder is not empowered to undertake any work outside the Kerala State Electricity Board Ltd/any other similar licensee premises. The restrictive Clause is enforced based upon the infrastructure requirement and technical competency specified for such other works.”

After going through the above facts, I think this is a matter to be considered by the 1st respondent before proceeding further. There can be an opportunity of hearing to the petitioner and the 4th respondent. The eligibility of the 4th respondent is to be reconsidered by the 1st respondent, in the light of the above facts. I make it clear that all the contentions of the petitioner and the 4th respondent are left open. There can be a time limit also for final decision by the 1st respondent. When this writ petition came up for consideration on 23.3.2021, this Court passed an interim order against the award of work to 4th respondent. The above interim order can be continued till a final decision is taken by the 1st respondent. During the course of argument, the Standing Counsel for the 1st respondent submitted that the 1st respondent may be given

WP(C) NO. 7428 OF 2021 8 liberty to decide whether further steps to be taken based on Ext.P2 tender notice. That is also to be decided by the 1st respondent. Therefore, this writ petition is disposed in the following manner : 1) The 1st respondent will decide the eligibility of the 4th respondent to submit tender, in the light of clause 1 (a) of Ext.P2 tender conditions, after giving an opportunity of hearing to the petitioner and the 4th respondent. 2) The above exercise should be completed by the 1st respondent within three weeks from the date of receipt of a copy of this judgment. 3) The 1st respondent is free to decide this issue or if they are not intending to proceed with Ext.P2 tender notice, they can decide that matter also, in accordance to law. 4) All the contentions raised by the petitioner and the 4th respondent in this writ petition are left open. 5) Till a final decision is taken by the 1st respondent, the interim order dated 23.3.2021 will continue. P.V.KUNHIKRISHNAN

JUDGE SKS

WP(C) NO. 7428 OF 2021 9 APPENDIX OF WP(C) 7428/2021 PETITIONER EXHIBITS EXHIBIT P1 THEOF THE RELEVANT PAGE OF 'A' GRADE ELECTRICAL CONTRACTOR'S LICENSE NO.CA 73 DATED 20.1.82 ISSUED BY 3RD RESPONDENT TO THE PETITIONER. EXHIBIT P2OF THE 'NOTICE INVITING TENDER' INCLUDING 'TENDER NOTICE' IN RESPECT OF TENDER NO.KINFRA/MTR/25/2020-21 DATED 5.1.2021 ISSUED BY THE IST RESPONDENT. EXHIBIT P3OF THE LICENSE DATED 19.8.20 ISSUED BY THE 3RD RESPONDENT TO MELVIN TOM OF THE 4TH RESPONDENT. EXHIBIT P4OF THE 'TECHNICAL EVALUATION SUMMARY' DATED 10.3.21 ISSUED BY THE IST RESPONDENT. RESPONDENT EXHIBITS EXHIBIT R2(A)OF THE AGREEMENT DATED 22.12.2017 EXECUTED BETWEEN THE 1ST RESPONDENT AND THE 2ND RESPONDENT.