Anbarasan.D vs. The Chief Engineer

Facts

The petitioner, D. Anbarasan, filed a writ petition challenging two orders dated 16.12.2019 and 11.12.2020 issued by the Chief Engineer, Tamil Nadu Generation and Distribution Corporation Limited (TANGEDCO). The petitioner sought the refund of Rs. 33,600 deposited as Earnest Money Deposit (EMD) for Lot No. 7 in an online tender for scrap materials. The petitioner's bids for Lots 10 and 11 were accepted, but his bid for Lot No. 7 was rejected because he quoted the total price (Rs. 6,31,000) instead of the rate per kilogram, as the system could not accept the decimal value of Rs. 11.42 per kilogram. The respondents forfeited the EMD and demanded GST on it. The petitioner had previously submitted an explanation for his quoting method.

Held

The Court held that the impugned proceedings forfeiting the Earnest Money Deposit (EMD) were unsustainable. The Court found that the petitioner's explanation for quoting the total amount instead of the rate per kilogram due to the system's inability to accept the decimal value of Rs. 11.42 was plausible. The Court reasoned that the tender conditions did not explicitly require bidders to quote rounded-off figures when decimals were involved, and that forcing the petitioner to quote Rs. 11 or Rs. 12 per kilogram would have resulted in a substantial difference in the total bid value, making the petitioner's original quote more logical. Consequently, the forfeiture of the EMD and the demand for 18% GST on it were quashed. The Court directed the first respondent to refund the EMD of Rs. 33,600 to the petitioner within two weeks, with interest at 7.5% per annum if not refunded within the stipulated time. The Court confined its order solely to the issue of EMD forfeiture as Lot No. 7 had already been allotted and the work completed.

Key Issues

1. Whether the petitioner violated the terms and conditions of the tender notification by quoting the price for Lot No. 7 in a manner that justified the forfeiture of his Earnest Money Deposit (EMD)? Petitioner's argument: The petitioner contended that he quoted Rs. 11.42 per kilogram, and the system's inability to accept the decimal value forced him to quote the total amount. He argued that the tender conditions did not mandate quoting rounded-off figures when decimals were involved, and that expecting him to quote Rs. 11 or Rs. 12 per kilogram would lead to a significant discrepancy in the total bid value, making his original quote logical. The forfeiture of EMD and demand for GST were therefore unjustified. Revenue/State's argument: The respondents argued that the petitioner wrongly quoted the price for Lot No. 7 instead of the rate per kilogram as specified in the tender document, which, according to Section 3.0(h) and Section 12(i) of the tender conditions, justified the rejection of the tender and forfeiture of the EMD.