V Tech Sunsystems PVT. LTD. -Australian Premium Solar (INDIA) PVT. LTD. (Consortium) vs. Union Of INDIA And Anr.
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The petitioner, V Tech Sunsystems Pvt. Ltd. - Australian Premium Solar (India) Pvt. Ltd. (Consortium), filed a writ petition challenging the rejection of its technical bid for an Off-Grid Solar Photovoltaic Water Pumping Systems tender issued by Energy Efficiency Services Limited (EESL). The petitioner's bid was rejected on two grounds: insufficient work experience and participation in more than one bid in the same tender. EESL, the respondent, is a government-promoted company. The petitioner sought quashing of communications rejecting its bid and a direction to include it in the price bid stage. The Court directed EESL to disclose the reasons for disqualification, which were then provided in a counter-affidavit.
Held
The Court held that the rejection of the petitioner's technical bid on the ground of insufficient work experience was illegal. The Court found that the respondent's interpretation of the "Note" under Qualifying Requirements was incorrect. The two experience certificates issued by Torrent Power Ltd. should have been included in the cumulative work experience calculation. The Court reasoned that these certificates were issued by a DISCOM, which was the recipient of the goods and services, and therefore sufficient to establish past experience. The principle of 'verba chartarum fortius accipiuntur contra proferentem' was applied, stating that any ambiguity in the tender document should be interpreted against the author (EESL). Consequently, the petitioner possessed the requisite work experience. The Court did not explicitly address the second ground of disqualification (participation in multiple bids) in its final holding, implying it was rendered moot by the decision on the first ground. The respondent was directed to proceed with the petitioner's bid in accordance with the tender processing procedure. The writ petition was allowed.
Key Issues
1. Whether the rejection of the petitioner's technical bid on the ground of insufficient work experience was valid, considering the interpretation of Clause 2.4 of Section 2 of the RFP and the "Note" under Qualifying Requirements, particularly concerning experience certificates issued by DISCOMs like Torrent Power Ltd. (Section 2, Clause 2.4 of RFP, Qualifying Requirements Note). 2. Whether the petitioner's participation in a consortium with M/S ECE ENERGIES, in addition to its own bid, constituted participation in more than one bid in contravention of Point No. 8 of Annexure II of the tender document, leading to disqualification. Petitioner's arguments: The petitioner contended that its cumulative work experience exceeded the requirement, even after applying the relaxation for MSE category bidders. It argued that the respondent wrongly excluded two experience certificates from Torrent Power Ltd. by misinterpreting the "Note" under Qualifying Requirements. The petitioner also argued that the entity participating in the consortium with M/S ECE ENERGIES was 'M/S Vtech Engineers', a separate entity from the petitioner 'M/S Vtech Sunsystem Pvt. Ltd.', thus not violating the clause against multiple participations. Respondent's arguments: The respondent argued that the petitioner's submitted work experience was insufficient. It also argued that the petitioner had participated in more than one bid in the same tender, both individually and as part of a consortium with M/S ECE ENERGIES, invoking Clause 8 of Annexure II of the tender document.
Sections Cited
Section 2, Clause 2.4 of RFP, Qualifying Requirements Note, Point No. 8 of Annexure II
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Cause title — parties, addresses and appearances
order copies/ LoA‟s and Completion Certificates from registered central/state/PSU (Public Sector Undertaking)/ Distribution Company (DISCOM). AND Memorandum of Association, Article of Association needs to be attached along with the bid. The bidder should also highlight the relevant provision/ article number which highlights the objects relating to the business fields mentioned in the previous column. AND Copy of Factory License Indian Factories Act, 1948 or any document to establish factory in running operations under the GST registration
Tabular details comprising of Order No.; Order Date; Client‟s Name; Description of Project; Supply/Completion Period (with from- /to-dates): Ref. No & Date of Material Receipt Certificates/PO/Work Completion Certificates.
Certificate, supporting the fact of the bidder being engaged in the business field mentioned in column B. If factory license does not specify that business field, a separate Government issued document shall be submitted in support of the bidder being engaged in the business field mentioned in column B
Xxxxxxxx Xxxxxxxxx Xxxxxxxxx
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“Notes: 1.. 2.. For manufacturer of Solar Pump or SPV, modules or Solar Pump Controller using indigenous technology:
If a bidder has submitted LoA/work experience certificates for supplying solar pump or SPV modules or Solar pump controllers to successful bidder (some other firm) who got that work from some Govt. tender, then, such work experiences shall only be considered on submission of the following along with the work experience certificate (as asked above): a. LoA and completion certificate given by Govt, department to the firm for which supply work has been completed by the bidder. The LoA and completion certificate shall be in line with the documents as asked in the tender document. ” (emphasis supplied)
The sole argument of learned counsel for the respondent is that the "Note" extracted hereinabove was attracted in relation to the experience certificates issued by M/S Torrent Power Ltd, and the petitioner has failed to submit the LoA and completion certificate given by a Government Department to Torrent Power Ltd. Hence the certificates issued by M/S Torrent Power Ltd cannot be included to calculate the total cumulative work experience of the Petitioner.
In order to treat the experience certificates issued by Torrent Power Ltd. as falling within this the scope of the aforesaid “Note”, the respondent had to aver and show that the Petitioner/ bidder has submitted LoA/ work experience certificate from:1) ‘Successful Bidder’ (some other firm)", and that successful bidder had: 2) "got that work from some Government tender." The same has not been done.
It is only on satisfaction of these twin conditions, that the respondent could have excluded from consideration the aforesaid two experience certificates issued by Torrent Power Ltd. on the ground that the petitioner had failed to submit LoA and completion certificate given by the Government Department to the "firm" i.e Torrent Power Ltd. The stand taken by the respondent shows that it has proceeded on the basis that M/s Torrent Power Ltd. was a “successful bidder (some other firm)” i.e. other than the petitioner, and M/s Torrent Power Ltd. had “got that work from some Government Tender”.
This submission of the respondent is completely fallacious, and stems from a complete lack of understanding of the aforesaid term and condition. The reason for the same is that, admittedly, Torrent Power is a DISCOM. Like the other DISCOMs whose experience certificates have been placed on record by the petitioner, and accepted by the respondent, the certificates issued by Torrent Power Ltd. were also liable to be accepted by the respondent without invoking the “Note”. Pertinently, column „C‟ in Annexure “II” above specifically talks of work order copies/ LOA‟s and completion certificates from, inter alia, Distribution Company (DISCOM). The certificates of the other DISCOMs viz. Dakshin Gujarat VIJ Company Ltd., Uttar Gujarat VIJ Company Ltd. and Paschim Gujarat VIJ Company Ltd. are all on the same lines as those issued by Torrent Power Ltd, and they have been accepted by the respondent rightly. The Respondent has neither made any averment in the Counter affidavit, nor shown any document to bring home the point that M/s Torrent Power Ltd. is not a DISCOM; that it had bid for some Government tender, and; was a successful bidder in that Government tender. The certificates issued by the other DISCOMs mention the empanelment No. of M/s. Australian Premium Solar (India) Pvt. Ltd. as SRT-PG-A-194, which is also mentioned in the two certificates issued by Torrent Power Ltd. Torrent Power Ltd being a DISCOM, was, in fact, the recipient of the service and products of M/s. Australian Premium Solar (India) Pvt. Ltd, and it is not even the respondent's case that Torrent Power Ltd. was the "successful bidder (some other firm)" who had secured the work from some Government tender. The certificates issued by DISCOMS are acceptable as stated in Column 2 of the above quoted tabulation.
In this view of the matter, it is abundantly clear to us that the “Note” under Qualifying Requirements, relied upon by the Respondent supra will not be applicable to the two certificates issued by the Torrent Power Ltd., and the experience covered by the said two certificates issued by Torrent Power Ltd. cannot be excluded for calculating the cumulative work experience of the petitioner.
In our view, the interpretation adopted by the respondent in respect of the said "Note" is absolutely wrong, and certainly cannot by passed off as a "plausible view". There was no basis for the respondent to assume that Torrent Power Ltd. was a successful bidder for supply of the product in question to some Governments, and that the petitioner/ its JV Partner acted as a sub-contractor. The meaning and spirit of the said "Note" is that a bidder, who relies on supplies made to a primary supplier/ contractor, should produce the LOA and completion certificate from the concerned Government Department for whom the contract is performed by the primary contractor. This is stipulated to ensure submission of genuine experience certificates, and competition without any disputes or complaints i.e. satisfactory completion. But when experience certificate is issued by a DISCOM – which is the recipient of the goods and services from the Contractor/ supplier, that experience certificate is sufficient to establish the past experience of the bidder certified as in the experience certificate.
Though, there is absolutely no doubt in our mind with regard to the interpretation of the "Note" in question, even if there was one, the Doctrine of verba chartarum fortius accipiuntur contra proferentem, binds the respondent. The respondent in the present case was the author of the terms and conditions of the tender. If the respondent had the intention to require the suppliers/ contractors – who supply the product/ service in question to DISCOMS, to also produce any other documents, then that should have been clearly stated. The wordings of “Note” should have been different, from the one as framed herein.
In Industrial Promotion & Investment Corporation of Orissa Ltd. v. New India Assurance Co. Ltd. And Anr, (2016) 15 SCC 315, the Supreme Court observed:
“10. ..The Common Law rule of construction “verba chartarum fortius accipiuntur contra proferentem” means that ambiguity in the wording of the policy is to be resolved against the party who prepared it. MacGillivray on Insurance Law[1] deals with the rule of contra proferentem as follows: “The contra proferentem rule of construction arises only where there is a wording employed by those drafting the clause which leaves the court unable to decide by ordinary principles of interpretation which of two meanings is the right one. “One must not use the rule to create the ambiguity – one must find the ambiguity first.” The words should receive their ordinary and natural meaning unless that is displaced by a real ambiguity either appearing on the face of the policy or, possibly, by extrinsic evidence of surrounding circumstances….”
The said principle of verba chartarum fortius accipiuntur contra proferentem has also been applied by the Supreme court in the case of Bank of India and Anr. v. K. Mohandas and Ors, (2009) 5 SCC 313 wherein the court observed thus:
“32. The fundamental position is that it is the banks who were responsible for formulation of the terms in the contractual Scheme that the optees of voluntary retirement under that Scheme will be eligible to pension under the Pension Regulations, 1995, and, therefore, they bear the risk of lack of clarity, if any. It is a well- known principle of construction of a contract that if the terms applied by one party are unclear, an interpretation against that party is preferred (verba chartarum fortius accipiuntur contra proferentem).”
In this view of the matter, we hold that the aggregate experience indicated in the two certificates dated 18.01.2021 issued by M/s Torrent Power Ltd. was liable to be included in the cumulative work experience of the petitioner. Thus, the petitioner had the requisite work experience as claimed by it, and its disqualification on that ground is illegal. The said disqualification of the petitioner is quashed. The respondent is, therefore, directed to proceed to deal with the petitioner's bid in accordance with the procedure prescribed for tender processing.
With these observations, the Writ Petition is allowed. The parties are left to bear their respective costs.
VIPIN SANGHI, J
JASMEET SINGH, J
AUGUST 31, 2021/ dm/ N.Khanna
Digiltally
Reproduced from the public record of the Delhi High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.