M/S Padmavati Enterprises Raichur vs. The State Of Karnataka And Ors

Though, the petitioner has filed a protracted writ petition, it would suffice to record the below mentioned facts, that are necessary for the purpose of deciding this writ petition.

The petitioner contends that respondent No.3 had issued a notification dated 14.03.2024 for supply of food articles, vegetables, fruits and meat Vijayapura Central Prison in terms of notification dated 14.03.2024. The petitioner participated in the said bid and furnished all the required documents. However, the said bid was cancelled. Thereafter, another notification was issued on 22.07.2024, which again was cancelled. Respondent No.3 then issued a notification bearing No.PC 2024-25/IND0175 dated 28.11.2024 for the very same purpose. The petitioner contends that point 19(10) of eligibility criteria mandated that solvency certificate should not be earlier than 6 months, prior to the last date of submission of NC: 2025:KHC-K:544 the bid. Similarly, petitioner contends that point 19 (4) mandates that a certificate in Annexure-D to the bid document should be duly certified by a Government authority. The petitioner contends that it has furnished solvency certificate dated 02.04.2024 and 05.04.2024 for a sum of Rs.2,00,00,000/- and Rs.3,00,00,000/- respectively, which were produced along with the bids submitted earlier. The petitioner contends that the solvency certificate issued by the Bank of Baroda is for a period of 1 year, which is evident from a declaration made by it as per Annexure-Q. The petitioner contends that in respect of procurement by other prisons in Mysore, Bellari, Dharwad and Shivamogga, the solvency certificates, which are valid for 9 months prior to the bid are accepted. Therefore, it is contended that prescribing 6 months valid solvency certificate is arbitrary and irrational.

Insofar as clause 19 (4) relating to furnishing a certificate in Annexure-D, it is contended that the petitioner is already registered under the GST Act and the petitioner has produced a certificate duly signed by the Environment Engineer of City Municipal Council, Raichur. Therefore, he contends that the aforesaid eligibility criteria should not come in the way of NC: 2025:KHC-K:544 respondent No.3 rejecting the technical bid submitted by the petitioner.

Learned counsel for the petitioner reiterated the above submissions and submitted that the petitioner has been supplying food material to the prisons and is an established businessman. He contends that respondent No.3 has after canceling the tender notification twice, has not issued the notification for the same purpose. He therefore contends that the petitioner cannot be expected to obtain a fresh solvency certificate and whatever is produced should meet the eligibility criteria. He also contends that the petitioner is a dealer registered under the provisions of Goods and Service Tax, further government officer is not necessary. Though, the petitioner has furnished Annexure-D, duly certified by an Environment Officer.

The learned Additional Government Advocate on the other hand submitted that the solvency certificate mentioning the eligibility criteria is necessary to ensure that the bidder has all the financial eligibility to participate in the tender. He submits that this is a mandatory term in the tender, which NC: 2025:KHC-K:544 cannot be diluted or dispensed. Insofar as, the requirement to file Annexure-D, he submits that this is only to ensure that the bidder has a fixed place of business. He thus, contends that these two conditions are made applicable to all bidders and therefore the petitioner cannot claim any exception.

I have considered the submission of the learned counsel for the petitioner and the learned Additional Government Advocate for respondents.

Point 19 (4) relating to eligibility prescribes as follows: Criteria Documentary evidence Bidder must have Main Registered Office or Branch Office for the respective firm which is not less than 3 years from the last date of bidding within Karnataka.

Annexure-D reads as follows: Annexure-D (Registration certificate from concerned Govt. Authority) (To be issued and certified by Government Authority) I hereby declare that M/s………………………………(Name of the supplier/firm/Company/Organization and its owners) have submitted the application for the issue of Registration certificate. I further state that M/s …………………………. (Name of the supplier/firm/ Company/ Organization and its owners) has a …………….(own/rented/leased) registration of main office/Branch office in following address.

It is not in dispute that the petitioner is a dealer registered under the GST Act and he is also a “trader” licensed by the Deputy Director of Agricultural Marketing, Raichur. It is also registered as a commercial establishment under the Karnataka Shops and Commercial Establishments Act, 1961. The petitioner has enclosed all these documents along with his bid document. He has also furnished Annexure-D stated above, duly certified by an Environment Engineer, CMC, Raichur.

As a matter of fact, point 19(7) and 19(9) of the bid document mandates that the bidder must have a valid trade license, GST registration certificate, which is extracted below: Criteria Documentary evidence Bidder must have valid trade license/license from any State/Central Government Authority for trading of food articles/food grains/ vegetables/ Valid license from concerned Government authority for food articles/veget NC: 2025:KHC-K:544 fruits/meat/chicken/fis h/egg/raw materials requirement for the bakery and factory.

The petitioner has complied the above apart from the eligibility criteria in point 19(1) of the tender document. Therefore, there was sufficient documentary evidence to establish that the petitioner is an entity registered under various enactments and has a known place of business. Therefore, even if it is assumed by that the Annexure-D furnished by the petitioner is not certified by a government agency, then to, the bid submitted by the petitioner cannot be rejected on the ground that the NC: 2025:KHC-K:544 petitioner has not complied point 19 (4) of the eligibility criteria.

Insofar as, point 19(10) of the bid document relating to furnishing of solvency certificate, it reads as under: Criteria Documentary evidence Solvency certificate obtained from Nationalized Bank to be furnished by the bidder equal to the estimated value. (Solvency certificate should not be earlier than 6 months from the last date of bid submission)

The prescription of furnishing a solvency certificate as one of the eligibility criteria is to ensure that the bidder has the financial ability to execute the tender NC: 2025:KHC-K:544 and therefore, this is mandatory requirement of any tender process. The petitioner has furnished solvency certificates dated 02.04.2024 and 05.04.2024 for a sum of Rs.2,00,00,000/- and Rs.3,00,00,000/- respectively. These solvency certificates were produced by the petitioner along with the bid document submitted, but, which were cancelled. Though, the petitioner contended that the solvency certificates are in force for a period of 1 year from the date of their issuance, there is no declaration made by any bank in that regard. The document produced by the petitioner, which is a certification by the Bank of Baroda, regarding question and answer posted on its website, cannot help the petitioner in any manner whatsoever. Having said that, the petitioner cannot be thrown out of fray by a mere production of a solvency certificate, which is beyond the time prescribed, but an opportunity should be granted to the petitioner, to furnish a fresh solvency certificate. NC: 2025:KHC-K:544

In that view of the matter, this writ petition is allowed in part. The petitioner is directed to furnish a latest solvency certificate before the technical bid is opened. If, a fresh solvency certificate is furnished, respondent Nos.2 and 3 shall accept it and proceed in accordance with law.

As regards the requirement to furnish certification as per Annexure-D, even if, the petitioner has not furnished Annexure–D or whatever is furnished does not meet the criteria prescribed under point 19(10) of the bid document, the technical bid of the petitioner shall be opened by considering the registration certificate furnished by him as per point 19(9) of the bid document. If, the bid submitted by the petitioner is responsive in other aspects, the respondent Nos.2 and 3 shall consider the bid in accordance with law. It is needless to mention, if the petitioner, clears the technical bid, its financial bid shall also be opened. NC: 2025:KHC-K:544

Learned Additional Government Advocate is permitted to file memo of appearance within 10 days from today. (R.NATARAJ) JUDGE