C.D.Antony Jacob vs. Kerala State Housing Board - Kerala High Court, 08 April 2021

WP(C).No.6321 OF 2021(M) 1 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE SMT. JUSTICE P.V.ASHA THUR AY, THE 08TH DAY OF APRIL 2021 / 18TH CHAITHRA, 1943 WP(C).No.6321 OF 2021(M) PETITIONER/S: C.D.ANTONY JACOB AGED 47 YEARS S/O. DOMINIC C.A, GOVERNMENT CONTRACTOR, CHITTATTUTHARA HOUSE, PALLURUTHY P.O, KOCHI 682 006 BY ADVS. SRI.BABU JOSEPH KURUVATHAZHA SRI.M.G.SREEJITH SMT.K.S.ARCHANA RESPONDENT/S: 1 KERALA STATE HOUSING BOARD THAMPANOOR MASJID ROAD, NEAR INDIAN INSTITUTE OF EMERGENCY MEDICAL, SANTHI NAGAR, PULIMOODU, THIRUVANANTHAPURAM 695 001, REPRESENTED BY ITS SECRETARY 2 CHIEF ENGINEER, KERALA STATE HOUSING BOARD, THAMPANOOR MASJID ROAD, NEAR INDIAN INSTITUTE OF EMERGENCY MEDICAL, SANTHI NAGAR, PULIMOODU, THIRUVANANTHAPURAM 695 001 3 THE EXECUTIVE ENGINEER, KERALA STATE HOUSING BOARD, THRISSUR DIVISION, AYYANTHOLE, THRISSUR 680 003 SHRI.K.DENNY DEVASSY, SC, K.S.H.B. THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08.04.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C).No.6321 OF 2021(M) 2 JUDGMENT Dated this the 8th day of April 2021 The petitioner is aggrieved by the cancellation of the award of contract as per Ext.P10 order dated 06.03.2021. It is stated that the tender was invited as per Ext.P2 on 10.12.2020 for construction of a building for Aswas Rental Housing Scheme for Government Medical College at Thrissur. The PAC of the work was shown as Rs.3,12,85,650/- (Rupees Three Crore Twelve Lakhs Eighty Five Thousand Six Hundred and Fifty only). The petitioner quoted Rs.2,94,76,458/- (Rupees Two Crores Ninety Four Lakhs Seventy Six Thousand Four Hundred and Fifty Eight only) and he was found to be L1 out of the total 5 bidders who were found qualified. Based on that work was awarded to petitioner as per Ext.P7 letter on 23.02.2021 directing him to execute the agreement within 21 days. The petitioner points out that as per Exts.P8 and P8(a) performance guarantee was deposited by way of fixed deposits on 24.02.2021 and stamp papers worth Rs.29,500/- (Rupees Twenty Nine Thousand Five Hundred only) was also remitted before the respondents on 26.02.2021. It was while so Ext.P10 order was passed canceling the work order. In Ext.P10 it was stated that while inviting the e-tenders PAC happened to be shown in it inclusive of 12% GST which is against the conditions

WP(C).No.6321 OF 2021(M) 3 of NIT. The Writ Petition was filed at that stage alleging that cancellation after the award of work and after furnishing performance guarantee is illegal and arbitrary.

Respondents have filed a counter affidavit stating that actually the PAC was Rs.2,79,33,608/- (Rupees Two Crore Seventy Nine Lakhs Thirty Three Thousand Six Hundred and Eight only) and the amount quoted by the petitioner was 5.52% above the PAC. It is also stated that the Chief Engineer is not competent to award such a work. It is stated that only after the work was awarded to the petitioner, respondents realized the mistake and immediately thereupon the notice was issued. Producing Ext.R1(e) proceedings of Technical Sanction, the respondents have stated that 12% GST was also included while stating the PAC in the NIT as Rs.3,12,85,650/- whereas it should have been Rs.2,79,39,608/- (Rupees Two Crore Seventy Nine Lakhs Thirty Nine Thousand Six Hundred and Eight only). According to the respondents the mistake is liable to be rectified and therefore it was cancelled. It is stated that the Board has also issued a letter to the petitioner inviting for a negotiation in good faith. But the petitioner did not turn up.

The petitioner has filed a reply affidavit stating that there is nothing illegal in awarding the work to the petitioner with the amount quoted by him even though it is inclusive of the GST. The petitioner submits that similar work has already been awarded by the respondents in Ext.P16. Ext.P16 is a selection

WP(C).No.6321 OF 2021(M) 4 notice dated 01.10.2020 issued by the 2nd respondent. Ext.P16 also would show that the same is for construction of a building under the Aswas Scheme in Alappuzha Medial College and PAC was Rs.4,16,73,410/- (Rupees Four Crore Sixteen Lakhs Seventy three Thousand Four Hundred and Ten only) and the negotiated rate of 5% above PAC was agreed by the Contractor. That work has been awarded by the Chief Engineer. The petitioner has submitted Ext.P17 letter before the Chief Engineer informing that he is agreeable for carrying out the work for an amount 5% above PAC by reducing the rate Rs.2,93,30,288/- (Rupees Two Crore Ninety Three Lakhs Thirty Thousand Two Hundred and Eighty Eight only) which is less than the original amount quoted by the petitioner based on which the selection notice was issued to him.

In the above circumstances, there shall be a direction to the 2nd respondent to consider Ext.P17 representation and to pass orders taking note of Ext.P16 also within a period of ten days from the date of receipt of a copy of the judgment. In the meanwhile work shall not be awarded to anybody else and further proceedings shall not be taken pursuant to Ext.P10. The Writ Petition is disposed of accordingly. P.V.ASHA rkc JUDGE

WP(C).No.6321 OF 2021(M) 5 APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1OF THE TENDER NOTIFICATION FOR THE CONSTRUCTION OF BUILDING FOR ASWAS RENTAL HOUSING SCHEME, FOR GOVERNMENT MEDICAL COLLEGE AT THRISSUR PUBLISHED BY THE 2ND RESPONDENT, IN THE E-CENTRE PORTAL OF THE GOVERNMENT OF KERALA, DATED 11-12-2020 EXHIBIT P2OF THE NOTICE INVITING TENDER DATED 10-12-2020 PUBLISHED BY THE 2ND RESPONDENT EXHIBIT P3 TRUE COPIES OF THE PAGE NUMBERS 760, 761, 763, 816 AND 817 OF THE PART 1- INSTRUCTIONS TO THE BOIDDERS ATTACHED TO EXT P2 NOTICE INVITING TENDER EXHIBIT P4OF THE CIRCULAR NO. 18/2019/FIN DATED 1-3-2019 ISSUED BY THE GOVERNMENT OF KERALA. EXHIBIT P5 TRUE COPIES OF THE FIRST AND LAST PAGES OF THE BID SUBMITTED BY THE PETITIONER EXHIBIT P6OF THE BID SUBMISSION CONFIRMATION DATED 16-12-2020 ISSUED TO THE PETITIONER, ON BEHALF OF THE 2ND RESPONDENT EXHIBIT P7OF THE WORK AWARDING LETTER/WORK ORDER DATED 23-2-2021 ISSUED BY THE 2ND RESPONDENT EXHIBIT P8OF THE FIXED DEPOSIT RECEIPT WORTH RS. 4.42,150/- DATED 24-2-2021 DEPOSITED IN FAVOUR OF THE 3RD RESPONDENT EXHIBIT P8 AOF THE FIXED DEPOSIT RECEIPT WORTH RS. 4,42,150/- DATED 24-02-2021 DEPOSITED IN FAVOUR OF THE 3RD RESPONDENT EXHIBIT P9OF THE LETTER DATED 26-02-2021 SUBMITTED BY THE PETITIONER BEFORE THE 3RD RESPONDENT ALONG WITH ETS. P8 AND P8(A) EXHIBIT P10OF THE ORDER NO. KSHB HO/684/2020-D2 DATED 6-3-2021 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P11OF THE LETTER NO-KSHB-HO/684/2020-D2 DATED 9.3.2021 ISSUED BY THE 2nd RESPONDENT EXHIBIT P12OF THE CIRCULAR NO-01/01/10 DATED 20.1.2010 ISSUED BY THE CENTRAL VIGILANCE

WP(C).No.6321 OF 2021(M) 6 COMMISSION UNDER THE GOVERNMENT OF INDIA. EXHIBIT P13OF THE RELEVANT PAGES OF CLAUSE 11.0 OF THE COMMON IRREGULARITIES/LAPSES OBSERVED IN STORES/PURCHASE CONTRACTS AND GUIDELINES FOR IMPROVEMENT IN THE PROCUREMENT SYSTEM PUBLISHED BY THE CHIEF TECHNICAL EXAMINER'S ORGANIZATION. CENTRAL VIGILANCE COMMISSION, GOVERNMENT OF INDIA. EXHIBIT P14OF G.O.(P) NO.16/2017/FIN. DATED 6.2.2017 ISSUED BY THE GOVERNMENT. EXHIBIT P15OF THE APPLICATION DATED 30.3.2021 SUBMITTED BY THE PETITIONER UNDER THE RIGHT TO INFORMATION ACT, BEFORE THE STATE PUBLIC INFORMATION OFFICER ATTACHED TO THE OFFICE OF THE 3RD RESPONDENT. EXHIBIT P16OF THE SELECTION NOTICE BEARING NO.KSHB-HO/1387/2019-D2 DATED 1.10.2020 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P17OF THE LETTER SENT BY THE PETITIONER TO THE 2ND RESPONDENT ON 1.4.2021 THROUGH EMAIL. RESPONDENT'S/S EXHIBITS: EXHIBIT R1(a)OF WORK ORDER NO.KSHB-HO/684/2020-D2 DATED 23/02/2021 ISSUED BY KERALA STATE HOUSING BOARD. EXHIBIT R1(b)OF NOTICE INVITING TENDER (NIT) ISSUED BY KERALA STATE HOUSING BOARD. EXHIBIT R1(c)OF LETTER DATED 09/03/2021 ISSUED BY THE KERALA STATE HOUSING BOARD TO THE PETITIONER. EXHIBIT R1(d)OF ESTIMATE (OF ALL CIVIL WORKS) ISSUED BY CHIEF ENGINEER, KERALA STATE HOUSING BOARD. EXHIBIT R1(e)OF THE TECHNICAL SANCTION PROCEEDINGS DATED 23.11.2020 ISSUED BY CHIEF ENGINEER, KERALA STATE HOUSING BOARD.