Rishi Dutt vs. State Th.Horticulture Deptt.And Ors.

Held

The Court held that the cancellation of the petitioner's bid and forfeiture of his earnest money was illegal and arbitrary. The Court found merit in the petitioner's argument that the five-day period for fulfilling the conditions, specifically submitting the bank guarantee, should be reckoned from March 25, 2019, given the banking holidays on March 23rd and 24th. The Court noted that the petitioner had deposited the post-dated cheques and bank guarantee on March 28, 2019, which complied with the requirement, as the cancellation occurred on March 27, 2019, before the expiry of the extended period. The Court also observed that the respondents had acted unfairly by delaying the intimation to the petitioner and by subsequently asking respondent No. 6 to match the petitioner's bid after allotting the contract to him. The Court quashed the cancellation order and the allotment order to respondent No. 6, directing the respondents to allot the contract to the petitioner and compensate him for the litigation period.

Facts

The petitioner, Rishi Dutt, challenged an order dated March 28, 2019, by respondent No. 5, which cancelled his contract offer for Gate Entry Fee Collection at the Fruit and Vegetable Market Narwal, Jammu for 2019-20 and forfeited his earnest money of Rs. 5,00,000/-. The petitioner also challenged the subsequent allotment of the contract to respondent No. 6. The tender notice (NIT No. 66 of 2018-19) stipulated a minimum reserve bid of Rs. 2,00,00,000/- plus GST, earnest money of Rs. 5,00,000/-, and payment of the bid amount in two equal installments within five days of being declared successful and within four months thereafter. The petitioner was the highest bidder at Rs. 2,19,01,100/-. He deposited the first installment of Rs. 1,09,50,550/- and submitted original documents but failed to submit the bank guarantee for the second installment within the stipulated five days, leading to the cancellation of his bid.

Key Issues

1. Whether the cancellation of the petitioner's bid and forfeiture of earnest money was illegal and arbitrary, violating the terms and conditions of the tender and Article 14 of the Constitution of India? The petitioner argued that he had fulfilled the conditions within the stipulated time, as the five-day period should be calculated from March 25, 2019, considering March 23rd and 24th were banking holidays. He contended that the respondents deliberately issued the intimation on March 22, 2019, knowing it would be difficult to arrange a bank guarantee. The petitioner also alleged mala fide actions by the respondents to favour respondent No. 6. The respondents' arguments are not explicitly recorded in the provided text, but their actions suggest they believed the petitioner failed to comply with the terms regarding the bank guarantee and post-dated cheques within the five-day period.