K.Abdul Rehiman vs. The State Farming House Corporation Of Kerala Limited

WP(C).No.527 OF 2021(M) 1 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE SMT. JUSTICE P.V.ASHA THUR AY, THE 04TH DAY OF FEBRUARY 2021 / 15TH MAGHA,1942 WP(C).No.527 OF 2021(M) PETITIONER/S: K.ABDUL REHIMAN AGED 62 YEARS THOTTARIKIL PURAYIDOM, KALANJOOR P.O., PATHANAMTHITTA BY ADVS. SRI.R.JAIKRISHNA KUM.NARAYANI HARIKRISHNAN RESPONDENT/S: 1 THE STATE FARMING CORPORATION OF KERALA LIMITED, VETTITHITTA P.O., ALIMUKKU,PUNALUR, KOLLAM, KERALA- 689 696, REPRESENTED BY ITS MANAGING DIRECTOR 2 THE COMMERCIAL OFFICER, THE STATE FARMING CORPORATION OF KERALA LIMITED, VETTITHITTA P.O., ALIMUKKU,PUNALUR, KOLLAM, KERALA- 689 696 3 STAR PLYWOOD, ODAKKALI, ASAMANOOR P.O., PERUMBAVOOR-683 549, REPRESENTED BY ITS MANAGING PARTNER-ANTHRU P.A. 4 PIUS ASSOCIATES, PILLATTU BUILDING, VARANDARAPPILLY P.O., THRISSUR- 680 303, REPRESENTED BY ITS PROPRIETOR- PIUS P.M. 5 ASHRAF OMMER RAWTHER, VII/128,KARIYARA P.O., PUNALOOR, KOLLAM-691 332 6 AMA TRADERS, 9/344,APPADATHU, PANIPRA ROAD, PANIPRA, KOTHAMANGALAM P.O.,-686 691, REPRESENTED BY ITS PROPRIETOR- ABDUL JABBAR 7 VARAMBEL ENTERPRISES, PPXII/432, KADASSERY, OPP VISHNU TEMPLE, KADASSERY

WP(C).No.527 OF 2021(M) 2 POONKULANJI P.O., PUNNALA,KOLLAM-689 695, REPRESENTED BY ITS PROPRIETOR- VISHNU P.S R1-2 BY ADV. SRI.DENIZEN KOMATH THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 01.02.2021, THE COURT ON 04.02.2021 DELIVERED THE FOLLOWING:

WP(C).No.527 OF 2021(M) 3 P.V.ASHA, J. ------------------------------------------ W.P.(C) No.527 of 2021 ------------------------------------------- Dated this the 4th day of February, 2021 JUDGMENT. This Writ Petition is filed seeking a direction to the 1st respondent to reject the tenders submitted by the respondents 3 to 7 on the ground that they have not submitted the requisite documents along with the tender; he seeks a further direction to award the sale of trees in his favour.

WP(C).No.527 OF 2021(M) 4 bid was submitted on account of technical glitch in the webportal the particular column was not showing the total price of trees. It is stated that petitioner had quoted a sum of Rs.1,755/- as base rate and for the total number of trees (1802) the total price should have been auto populated as Rs.13,62,510/- (1802x 1755); but it was showing only Rs.1,755/- which was the base rate. It is stated that the 1st respondent awarded the trees of Block No.E of Chithalvetti to the 3rd respondent and Block K was awarded to another person. It is stated that in block no.F of Chithalvetty Estate and Block no.17 and 18 of Cherupitakavu Estate, though petitioner was the bidder who quoted the highest price as per Exts.P4 series available in the e-tender portal, the 1st respondent decided to cancel the tender and initiated steps for retender. It is stated that on coming to know about the same, petitioner submitted Exts.P5 and P6 letters to the 1st respondent on 14.12.2020 and 22.12.2020 pointing out the fulfillment of all tender conditions by him and the technical glitches occurred in the portal. It is stated that 1st respondent did not respond to his representations. On 21.12.2020, the 1st respondent issued Ext.P7 notice for re-tender of the Rubber Trees at Block 7 of Chithalvetti Estate and Block 17 and 18 of

WP(C).No.527 OF 2021(M) 5 Cherupittakavu estate along with trees in other 4 blocks. Petitioner claims that as there was paucity of time for challenging the re-tender process he participated in the re-tender. It is stated that clause 3 directing to quote the price on block basis, was included in Ext.P8 re-tender conditions since the 1st respondent had taken note of the technical glitch occurred in the e-portal; at the same time out of the 19 blocks, 1st respondent chose to hold re- tender only in 7 blocks and that in three blocks out of those 7 which were re-tendered, petitioner was the bidder who quoted highest price. It is stated that pursuant to the re-tender notification, petitioner submitted his bid in 6 blocks including the three blocks in which he was the highest bidder. It is stated that there were three bidders in each of the 7 blocks in which he participated and in these blocks respondent no.3 and 6 were the highest bidders after re-tender. It is stated that Ext.P9 series of the schedule of price quoted by the bidders for the said 7 blocks would show that the 6th respondent turned out as the highest bidder in block no.A, D and F of Chithalvetti and the 3rd respondent turned out to be highest bidder in block no.17 and 18 of Cherupittakavu and also in Mullumala. According to the petitioner bids submitted by respondents 3

WP(C).No.527 OF 2021(M) 6 to 7 were not liable to be considered since their bids were defective and they had not uploaded the requisite documents. The following are the infirmities pointed out by the petitioner: In the case of the 3rd respondent-Star Plywood:

WP(C).No.527 OF 2021(M) 7

WP(C).No.527 OF 2021(M) 8 that as per clause 11 and 19 of Exts.P2 and P8 tender conditions the Corporation reserves full rights to accept or reject any or all tenders without assigning any reason. It is stated that clause 14 of Ext.P2 conditions provided that the trees would only be sold in block. But the petitioner committed a mistake by not offering the price in accordance with clause 14 of Ext.P2 tender conditions for the entire block. According to the respondent there was no technical glitch of any kind and all other participants have given the rate for the block. It is stated that the IT mission server submits the comparison statement through online e-tender portal from which the Corporation is to consider highest rate offered by each tender for each Block. Out of the 19 blocks notified in the original tender the highest offer in 12 blocks was accepted and confirmation order was issued to the tenderers who quoted the highest rate. Producing Ext.R1(a), (b) and (c) BOQ summaries, the respondent has stated that the contention of petitioner with respect to the original tender are baseless. It is stated that the 1st respondent had considered the representation submitted by the petitioner and that the decision to re-tender for certain blocks including Chithalvetti and Cherupitakavu estates was taken,

WP(C).No.527 OF 2021(M) 9 based on the recommendation of the Sales Committee. It is stated that he had submitted Ext.P6 representation raising claims on 1st tender after participating in the 2nd tender. It is stated that the original tender was opened on 10.12.2020. Based on the decision for re-tender, notice for re-tender was issued on 21.12.2020 giving due opportunity for the contesting parties. It is stated that a 2nd tender became necessary in view of the low rates offered by the contestants and in order to see that the contestants like petitioner are not committing repeated glitches while quoting tenders through IT Portals, that it became necessary to incorporate clause 3 in the notice inviting re-tender. The respondent doubted the bonafides of the petitioner pointing out that the price he quoted in the re- tender is far less than in the first tender. Regarding the infirmities pointed out by the petitioner with respect to the party respondents it is stated that signature in all the pages of the tender is not necessary when it is digitally signed. Regarding the other contentions with respect to the non submission of ID card, Pancard, GST registration, etc it is stated that the participants had already submitted those details in the previous occasion pursuant to Ext.P1 tender. It is further stated that as per

WP(C).No.527 OF 2021(M) 10 clause 12 of Ext.P8 tender the 1st respondent has the authority to accept or reject any re-tender on any reason. It is stated that the 3rd respondent is already having Ext.R1(e) GST registration. It is stated that the petitioner who quoted rates far below does not have any right to claim that the trees covered by the re-tender shall be awarded to him. According to the 1st respondent any delay in finalisation of the re-tender would cause irreparable financial loss to the Corporation which is already running on loss.

WP(C).No.527 OF 2021(M) 11 Pvt. Ltd. (M/s.) and others v. Silppi Constructions and Contractors and others : 2019 (3) KHC 566 and Abdul Majeed K.S. And another vs. Beeru P.K. and others : 2013 (3) KHC 805 (para 11), Indian Railway Catering & Tourism Corporation Ltd. (M/s.) and another vs. Doshion Veolia Water Solutions (P) Ltd. (M/s.) and others : 2010 KHC 4740 it was argued that intervention of the court in matters of contract should be limited to cases where the decision made by the authority is malafide or intended to favour somebody or where the process adopted is so arbitrary. It was argued that the Corporation has taken its decision in public interest and it has got every right to take such a decision in the interest of the Corporation and interference at the instance of petitioner who quoted a very low rate is not called for.

WP(C).No.527 OF 2021(M) 12 several other participants who had quoted the rate per block and did not face any such technical glitches as alleged by the petitioner. Ext.R1(d) would also show that the decision for re-tendering was taken in the interest of the Corporation. At any rate petitioner has not challenged the said decision and has not sought any relief based on the tender he submitted pursuant to Ext.P1 tender notification. On the other hand he has participated in the re-tender that too quoting rate far lower than which he quoted in the original tender. Petitioner does not have a case that he is the highest bidder in the re-tender. He is claiming his chance pointing out the infirmities in respect of other tenderers who quoted higher price, referring to clause 13 and 18B and C of Ext.P8 tender conditions. Regarding the absence of signature in all pages, learned Counsel for the petitioner has withdrawn the contention, agreeing that digital signature is sufficient. The other infirmities pointed out are non production of Pancard, GST registration, Adhaar card, credit worthiness certificate received from the Bank, etc. If the 1st respondent found that those conditions can be relaxed and those are all matters which could be ensured otherwise, it cannot be said that their tenders have to be rejected when the amount

WP(C).No.527 OF 2021(M) 13 quoted by them are at a higher rate and that the rejection of their tenders would defeat the interest of the Corporation. Therefore, an intervention at the instance of petitioner who has quoted a very low price, would not be just or fair. Even if there is violation of clause 18 those infirmities were found to be curable on production of the relevant documents. When the tendering authority has found it proper to accept the tenders from the party respondents in the interest of the institution this Court is not expected to interfere with such a decision.

WP(C).No.527 OF 2021(M) 14 merely reviews the manner in which the decision was made; the court does not have the expertise to correct the administrative action; Government must have freedom of contract; a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principle of reasonableness; but must be free from arbitrariness not affected by bias or actuated by malafides; quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure. The aforesaid judgment is reiterated and followed in a series of judgments. As held in Jagdish Mandal v. State of Orissa: (2007) 14 SCC 517 so long as a decision relating to award of contract is bonafide and is in the public interest, courts are not supposed to interfere by exercising power of judicial review even if a procedural aberration or error in assessment or prejudice to a tenderer is made out.

WP(C).No.527 OF 2021(M) 15 of public interest was involved or in case the transaction was vitiated by malafides. In B.S.N. Joshi & Sons Ltd. v. Nair Coal Services Ltd.: 2006 (11) SCC 548 it was held that when a decision is taken by the appropriate authority upon due consideration of the tender document submitted by all the tenderers on their own merits, the Courts have to exercise judicial restraint once it was found that the decision of the authority was taken purely in public interest. In Afcons Infrastructure Ltd. v. Nagpur Metro Rail Corpn. Ltd.: (2016) 16 SCC 818 it was held that the employer of a project who authored the tender documents, is the best person to understand and appreciate its requirements and interpret its documents. It was held as follows: “The constitutional courts must defer to this understanding and appreciation of the tender documents, unless there is mala fide or perversity in the understanding or appreciation or in the application of the terms of the tender conditions. It is possible that the owner or employer of a project may give an interpretation to the tender documents that is not acceptable to the constitutional courts but that by itself is not a reason for interfering with the interpretation given.xxxxx

WP(C).No.527 OF 2021(M) 16 SCC 462 , the Apex Court was considering a case where tenders were invited for door-to-door collection and transportation of municipal solid waste. After analysing various judgments with respect to the scope of judicial review on contractual matters, the 3 Judge Bench reiterated that the purpose of judicial review of administrative action is to check whether the choice or decision is made lawfully and not to check whether the choice or decision is sound. If the process adopted or decision made by the authority is not malafide and not intended to favour someone, if the process adopted or decision made is neither so arbitrary nor irrational and if the public interest is not affected, there should be no interference under Article 226. In paragraph 45 it was held as follows:

WP(C).No.527 OF 2021(M) 17 judgments in TBAS Construction Supreme Infrastructure India Ltd. (M/s.) and in Pushkarraj Constructions Pvt. Ltd. (M/s.)'s case held that interference with the decisions of tendering authority must be only in exceptional cases and while examining the rationality of a decision the court should look at the matter in the point of view of the tendering authority and even in cases where there is procedural lacuna court should refrain from interference if the decision is for public interest.

WP(C).No.527 OF 2021(M) 18 blocks for which re-tender was notified. In the light of the judgments of the apex court that the power of judicial review in matters of contract are limited and it is for the tendering authority to decide whether a tender can be accepted or not in the interest of public, this Court is not expected to interfere with the re-tender. There is no allegation of malafides or that the 1st respondent is favouring anybody.

Accordingly the Writ Petition is dismissed. P.V.ASHA rkc JUDGE

WP(C).No.527 OF 2021(M) 19 APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1OF THE NOTICE INVITING TENDER ISSUED BY THE 1ST RESPONDENT EXHIBIT P2THE TENDER CONDITIONS ISSUED BY THE 1ST RESPONDENT FROM THE WEBSITE 5.12.2020 EXHIBIT P3OF THE PRICE SCHEDULE WITH RESPECT TO THE BID SUBMITTED BY THE PETITIONER FOR BLOCK E OF CHITHALVETTY ESTATE EXHIBIT P3AOF THE PRICE SCHEDULE WITH RESPECT TO THE BID SUBMITTED BY THE PETITIONER FOR BLOCK F OF CHITHALVETTY ESTATE EXHIBIT P3BOF THE PRICE SCHEDULE WITH RESPECT TO THE BID SUBMITTED BY THE PETITIONER FOR BLOCK K OF CHITHALVETTY ESTATE EXHIBIT P3COF THE PRICE SCHEDULE WITH RESPECT TO THE BID SUBMITTED BY THE PETITIONER FOR BLOCK 17 OF CHERPPITTAKAVU ESTATE EXHIBIT P3DOF THE PRICE SCHEDULE WITH RESPECT TO THE BID SUBMITTED BY THE PETITIONER FOR BLOCK 18 OF CHERUPPITTAKAVU ESTATE EXHIBIT P4OF THE PRICE SCHEDULE WITH RESPECT TO THE BID SUBMITTED BY THE PETITIONER FOR BLOCK- F OF CHITHALVETTY ESTATE EXHIBIT P4AOF THE PRICE SCHEDULE WITH RESPECT TO THE BID SUBMITTED BY THE PETITIONER FOR BLOCK- 17 OF CHERUPPITTAKAVU ESTATE EXHIBIT P4BOF THE PRICE SCHEDULE WITH RESPECT TO THE BID SUBMITTED BY THE PETITIONER FOR BLOCK- 18 OF CHERUPPITTAKAVU ESTATE

WP(C).No.527 OF 2021(M) 20 EXHIBIT P5OF THE LETTER SUBMITTED BY THE PETITIONER TO THE 1ST RESPONDENT EXHIBIT P6OF THE LETTER SUBMITTED BY THE PETITIONER TO THE 1ST RESPONDENT EXHIBIT P7OF THE NOTICE ISSUED BY THE 2ND RESPONDENT EXHIBIT P8OF THE RE-TENDER CONDITIONS ISSUED BY THE 1ST RESPONDENT FORM THE WEBSITE EXHIBIT P9OF THE SCHEDULE OF PRICE QUOTED BY THE BIDDERS FOR BLOCK A OF CHITHALVETTY ESTATE EXHIBIT P9AOF THE SCHEDULE OF PRICE QUOTED BY THE BIDDERS FOR BLOCK D OF CHITHALVETTY ESTATE EXHIBIT P9BOF THE SCHEDULE OF PRICE QUOTED BY THE BIDDERS FOR BLOCK F OF CHITHALVETTY ESTATE EXHIBIT P9COF THE SCHEDULE OF PRICE QUOTED BY THE BIDDERS FOR BLOCK 17 OF CHERUPPITTAKAVU ESTATE EXHIBIT P9DOF THE SCHEDULE OF PRICE QUOTED BY THE BIDDERS FOR BLOCK 18 OF CHERUPPITTAKAVU ESTATE EXHIBIT P9EOF THE SCHEDULE OF PRICE QUOTED BY THE BIDDERS FOR BLOCK 7B OF MULLUMALA ESTATE EXHIBIT P10OF THE SAMPLE TENDER DOCUMENT SUBMITTED BY 3RD RESPONDENT EXHIBIT P10AOF THE SAMPLE TENDER DOCUMENT SUBMITTED BY 4TH RESPONDENT EXHIBIT P10BOF THE SAMPLE TENDER DOCUMENT SUBMITTED BY 5TH RESPONDENT EXHIBIT P10COF THE SAMPLE TENDER DOCUMENT SUBMITTED BY 6TH RESPONDENT EXHIBIT P10DOF THE SAMPLE TENDER DOCUMENT SUBMITTED BY 7TH RESPONDENT

WP(C).No.527 OF 2021(M) 21 EXHIBIT P11OF THE LETTER SUBMITTED BY THE PETITIONER BEFORE THE 1ST RESPONDENT RESPONDENT'S/S EXHIBITS: EXHIBIT R1(a) TRUE PHOTOCOPY OF THE BOQ SUMMARY OF THE PETITIONER AND THAT OF THE HIGHEST BIDDER REGARDING CHITHALVETTY ESTATE BLOCK CY F IN THE FIRST TENDER. EXHIBIT R1(b) TRUE PHOTOCOPIES OF THE BOQ SUMMARY OF THE PETITIONER AND THAT OF THE HIGHEST BIDDER REGARDING CHERUPPITTAKAAVU ESTATE BLOCK 17 IN THE FIRST TENDER. EXHIBIT R1(c) TRUE PHOTOCOPIES OF THE BOQ SUMMARY OF THE PETITIONER AND THAT OF THE HIGHEST BIDDER REGARDING CHERUPPITTAKAAVU ESTATE BLOCK 18 IN THE FIRST TENDER. EXHIBIT R1(d) TRUE PHOTOCOPY OF THE DETAILS AND MINUTES OF THE FIRST TENDER COUNTER SIGNED BY THE 1ST RESPONDENT MANAGING DIRECTOR ON 22.12.2020. EXHIBIT R1(e) TRUE PHOTOCOPY OF THE GST REGISTRATION CERTIFICATE OF THE 3RD RESPONDENT STAR PLYWOOD INDUSTRIES. EXHIBIT R1(f) TRUE PHOTOCOPY OF THE DETAILS AND MINUTES OF THE FIRST TENDER COUNTER-SIGNED BY THE 1ST RESPONDENT MANAGING DIRECTOR ON 5.1.2021.