Abdul Nazar M.A. v. The Chief Engineer, Kerala State Housing Board; The Executive Engineer, Kerala State Housing Board; TP Construction

**C.R.** IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR. JUSTICE DAMA SESHADRI NAIDU THURSDAY, THE 15TH DAY OF JUNE 2017/25TH JYAISHTA, 1939 WP(C).No. 14966 of 2017 (U) ---------------------------- PETITIONER/PETITIONER: --------------------ABDUL NAZAR M.A AGED 48 YEARS,S/O.M.ABDUL KUNHI, RESIDING AT 'NAFIH MANZIL,MASTHIKUND KETTUNGAL, P.O.MULIYAR, KASARAGOD. BY ADVS.SRI.SHIRAZ ABDULLA SRI.M.S.IMTHIYAZ AHAMMED RESPONDENTS/RESPONDENTS: ----------------------- 1. THE CHIEF ENGINEER KERALA STATE HOUSING BOARD,SANTHI NAGAR, THIRUVANANTHAPURAM 695 001. 2. THE EXECUTIVE ENGINEERT KERALA STATE HOUSING BOARD, SANTHI NAGAR,THIRUVANANTHAPURAM 695 001. Addl3. T.P.CONSTRUCTION - Ist FLOOR, A.V.M.COMPLEX, CHIRANGARA, KORATTY - SOUTH POST, THRISSUR 680 308. (R3 IS IMPLEADED AS PER ORDER DATAED 16.5.2017 IN I.A.No.7314/2017) R1-2 BY ADV. SRI.MANOJ RAMASWAMY, SC, KERALA STATE HOUSING BOARD R3 BY ADV. SRI.ANIL D. NAIR R3 BY ADV. SRI.JINISH PAUL P R3 BY ADV. SRI.R.SREEJITH R3 BY ADV. SMT.MEKHALA M BENNY R3 BY ADV. SRI.JOSEPH GOPURAN R BY SRI.MANOJ RAMASWAMY, SC, KERALA STATE HOUSING BOARD THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 15-06-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ## WPC no.14966/2017 2 WP(C).No. 14966 of 2017 (U) ---------------------------- ## APPENDIX PETITIONER'S EXHIBITS --------------------EXHIBIT P1 COPY OF THE NOTICE INVITING TENDER EXHIBIT P2 COPY OF THE RELEVANT PAGES OF THE NOTIFICATION,PRESCRIBING THE ADDITIONAL DOCUMENTS TO BE SUBMITTED BY THE BIDDERS EXHIBIT P3 COPY OF THE ATTESTED COPY OF THE REGISTRATION CERTIFICATE SUBMITTED BY THE PETITIONER ALONG WITH OTHER DOCUMENT EXHIBIT P4 COPY OF THE REJECTION NOTE OF THE TECHNICAL BID OF THE PETITIONER,PUBLISHED IN THE WEBSITE EXHIBIT P5 COPY OF THE G.O.(RT)NO.541/2017/PWD DTD 25/4/2017 EXHIBIT P6 COPY OF THE COLOURED COPY OF THE REGISTRATION CERTIFICATE OF THE PETITIONER EXHIBIT P7 COPY OF THE LAWYER NOTICE DTD.26.04.2017 EXHIBIT P8 COPY OF THE FINANCIAL BID SUBMITTED BY TWO OTHERS,NAMELY.M,SREEKANDAN NAIR AND T.P.CONSTRUCTIONS DTD 27.04.2017. EXT.P9 COPY OF GO (Rt) NO.422/17 DTD.30.3.2017. EXT.P10 COPY OF COMMUNICATION OF SUPERINTENDING ENGINEER, PWD, NORTH CIRCLE, KOZHIKODE DTD.12.5.2017. RESPONDENT'S EXHIBITS --------------------EXT.R1(a) TRUE COPY OF THE NOTICE INVITED TENDER VIDE NO.T153/2013/C/HB DTD.28.3.2017 ALONG WITH THE TENDER DETAILS. EXT.R1(b) TRUE COPY OF THE DOCUMENT UPLOADED IN THE E-TENDER KERALA BY THE PETITIONER 2017. EXT.R1(c) TRUE COPY OF THE ATTESTED PHOTOCOPY SUBMITTED BY THE PETITIONER THROUGH POST. EXT.R1(d) TRUE COPY OF THE LETTER NO.T.153/2013/C/HB DTD.28.4.2017 ISSUED BY THE IST RESPONDENT. EXT.R1(e) TRUE COPY OF THE AGREEMENT NO.EE/KSHB/KSD/1/2017-18 DTD. 15.5.2017. EXT.R1(f) TRUE COPY OF THE LETTER VIDE NO.DB-B7/LBS/IND/AUD/2013 DTD.17.5.2017. WPC no.14966/2017 3 - 2 - EXT.R3(a) TRUE COPY OF AGREEMENT DTD.15.5.2017. EXT.R3(b) TRUE COPY OF THE TREASURY CERTIFICATE DTD.11.5.2017. Ext.R3(c) TRUE COPY OF THE BANK GUARANTEE DTD.12.5.2017. EXT.R3(d) TRUE COPY OF THE JUDGMENT IN WPC NO.17232/2015. EXT.R3(e) TRUE COPY OF THE NOTICE INVITING TENDER DATED 28.3.2017 ISSUED TO THE FIRST RESPONDENT AND SUBMITTED BY THE THIRD RESPONDENT. True copy P.S.TO JUDGE css/ **C.R. Dama Seshadri Naidu, J.** ------------------------------------------WPC No.14966 of 2017 -------------------------------------------Dated this the 15[th] day of June 2017 ## **JUDGMENT** ## **Introduction:** To a notification inviting tenders to execute certain civil works, three contractors respond. The bids opened and processed, at one stage the petitioner’s name is dropped: he has no valid licence. On the very same day, the petitioner contacts the officials and sends proof that he does have. The next day, he sends a legal notice, and a day after he files a writ petition. 2. The petitioner contends that he has a valid licence. Alternatively, he pleads that the Government extended the period of the old licence beyond the date mentioned in the tender notification. But the authorities maintain that the petitioner has failed to fulfil the tender conditions. Then the mantle falls on WPC No.14966 of 2017 2 another contractor who is awarded the work. So the questions the Courts needs to answer are these: - i. Has the petitioner failed to fulfil the tender conditions to have his bid entertained by the authorities? ii. Does the authorities’ awarding contract to another bidder affect the petitioner’s right to legal remedies? ## **The Controversy:** 3. Petitioner Abdul Nazar, an A-class contractor, responded to the Ext.P1 tender notification issued by respondents 1 and 2 of the Kerala State Housing Board. The bids were called for civil works including water supply and sanitary installation works. These works include constructing an indoor auditorium for LBS College of Engineering, Kasargod. 4. As it is an e-tender, three persons, including Abdul Nazar, offered their bids. The Housing Board kept informing the people interested, including the bidders, through their website the minute to minute developments of its processing the bids. As seen from WPC No.14966 of 2017 3 Ext.P4, the tender summary report, at 3.39 p.m. the list of valid bids contained all three names. Also in the list of technical bids, Abdul Nazar’s was shown. But the status reflected: not admitted. On the evening of 25[th] April 2017, the technical-bid-opening summary provided the reason why Nazar’s bid was rejected: “out of three bids received, one rejected due to non-submission of a valid registration certificate. The two accepted bids are under scrutiny.” 5. After noticing that his bid was rejected, on the same day, i.e., on 25[th] April 2017, Nazar is said to have telephoned the respondent authorities to know why his bid was not admitted. It seems that the authorities told him over the phone that in the registration certificate (“licence”), the signature of the renewing authority, the Superintending Engineer, was missing. Nazar first sent a scanned colour-copy of the licence to show that it contains the renewing authority's signature—in fluorescent ink, though. The next day, on 26.4.2017, he sent a notice through his counsel WPC No.14966 of 2017 4 asserting that the certificate was duly attested by the gazetted officer, and there is no ambiguity. Therefore, Nazar requested the authorities to process his bid. 6. As seen from Ext.P8, despite Nazar’s notice and clarification, the authorities proceeded further to consider only the remaining two bids. As the financial bid was opened on 27[th] April 2017, Nazar filed the writ petition on 28.4.2017 before a vacation court. According to Nazar’s counsel, the Court was not inclined to grant a “today-motion,” but it listed the matter on 02.05.2017 for admission. On notice, the learned Standing Counsel informed the Court that Nazar’s bid was rejected because of his not having a valid license. He has also informed that the work was awarded to one of the other two bidders. 7. In the light of the later developments, Nazar brought the successful bidder, TP Constructions, on record as the third respondent and had the matter posted to 12.5.2017. Later, on 16.5.2017, Nazar produced the Ext.P10 certificate issued by the WPC No.14966 of 2017 5 renewing authority, that Nazar’s license had been validly renewed on 28.3.2017 itself. Then this Court ordered _status quo_ . **Submissions:** ## **Petitioner’s:** 8. In the above factual backdrop, Sri Shiraz Abdulla M.S., the petitioner’s counsel, has strenuously contended that the Housing Board has excluded the petitioner from consideration with no valid reason. According to him, Ext.P3, scanned, might not have explicitly revealed the renewing authority's signature in full. It has, however, shown the traces of signature, and it could not have been ignored by the authorities. Drawing my attention to Ext.P2, an extract of Ext.P1 tender notification, a full copy of which was filed by TP Constructions as Ext.R3(e), Sri Abdulla has contended that Nazar had to upload only a scanned copy of the registration certificate, showing validity and class of registration, attested by the gazetted officer of the department. To elaborate, he has submitted that Nazar did upload the certificate duly attested by a WPC No.14966 of 2017 6 gazetted officer. 9. Sri Shiraz Abdulla has also submitted that, having diligently followed the scrutiny process, on the day he came to know that his name had been excluded, Nazar did all that he could to impress on the authorities concerned that he had strictly complied with the principal parameters of the Ext.P1 notification, including that of uploading an attested registration certificate issued by a competent authority. 10. To support his contention, Sri Abdulla has drawn my attention to the Ext.P6 scanned colour-copy of the Ext.P2, showing clearly the signature of the Superintending Engineer, the renewing authority. That apart, he has also laid stress on the Ext.P7 legal notice to hammer home his contention that before the authorities could proceed further with the tendering process—especially before they could finalise it—Nazar had explicitly placed on record why his bid should be considered. 11. In anticipation of the submissions by the respondents, the WPC No.14966 of 2017 7 learned counsel has also submitted that Nazar wanted no correction to the bid he had submitted; on the contrary, he only insisted on the authorities’ reading the documents carefully and properly and processing them further without prejudicing Nazar’s interest. As to the diligence said to have been displayed by Nazar, Sri Abdulla has also submitted that on 27.4.2017, the commercial bid was opened without considering Nazar’s claim. The very next day, Nazar filed the writ petition. 12. In this regard, Abdulla has submitted that if any procedural delay has occurred while this Court’s considering the writ petition and, in the meanwhile, another had the work awarded to him, it should not prejudice the petitioner’s cause. So he has urged this Court to allow the writ petition. ## **Housing Board’s:** 13. _Per contra_ , Sri Manoj Ramaswamy, the learned Standing Counsel for the respondents 1 and 2, has submitted that the officials cannot be said to have acted _mala fide_ or with any ulterior WPC No.14966 of 2017 8 motive. This Court, urges Sri Ramaswamy, can scrutinise the original records produced by the Housing Board and conclude whether the uploaded registration certificate contained the reviewing authority's signature. 14. To elaborate his submissions, the learned Standing Counsel has submitted that, all along, the respondent officials have maintained that Nazar has not uploaded a “valid” registration certificate. In other words, since the registration certificate did not contain the reviewing authority's signature, except the seal of his office, it cannot be said, contends the learned Standing Counsel, that the uploading was valid as per the conditions stipulated in the Ext.P2 extract of the notification. He has also submitted that, as a matter of later developments, before this Court could grant _status quo_ order, the authorities _bona fide_ processed the bids and accepted the one offered by TP Constructions. Therefore, the position has become irreversible, and any judicial intervention at this stage would affect the public interest, concludes the learned WPC No.14966 of 2017 9 Standing Counsel. ## **Third Respondent’s:** 15. Sri Anil D.Nair, the learned counsel for the third respondent, has strenuously contested Nazar’s claim that he had emailed a scanned colour-copy of the Ext.P2 registration certificate on the very same day. Sri Nair has taken me through the entire record, including the counter affidavit filed by the respondents 1 and 2. He has submitted that this Court in _Thomas P.C. and Company v Executive Engineer, Central Public Works Department, Thrissur_[1] has affirmed that in an e-tender process the judicial intervention is minimal. In other words, once the authorities have rejected a bid for any valid reason or a reason they found to be valid, this Court will be reluctant to exercise its power of judicial review to interdict tendering, for it will have a deleterious commercial impact, besides affecting the public interest, too. 16. Sri Nair has also submitted that TP Constructions has nothing to do with any alleged omissions and commissions by the > 1 2013 KHC 47 WPC No.14966 of 2017 10 officials. As his bid was proper, it was duly evaluated by the authorities, and he had the work awarded to him. Now, he has also spent a lot of money: about 32 lakh rupees, besides mobilizing crores of rupees to execute the work on time. If, at this juncture, the Court interdicts the awarded work, it would immensely prejudice the third respondent, besides visiting on him with severe financial consequences. He has also drawn my attention to _Air India v Cochin International Airport_[2] to contend that judicial intervention in the matters of contracts must be only when the process affects the substantial public interest. 17. Summing up his submissions, Sri Nair has submitted that the writ petition lacks merit and deserves to be dismissed. He has also submitted that Nazar initially took a stand that the license could be renewed during the bidding process but now, having given up that stand, he has been insisting that he uploaded a validly signed document; neither claim could be sustained, contends Sri Nair. 2(2000) 2 SCC 617 WPC No.14966 of 2017 11 18. In the alternative, Sri Nair has also contended that for whatever reason this Court concludes that the petitioner's bid has been unfairly excluded, the only remedy left for the Court is to order re-notification, because soon after the authorities excluding the petitioner's name, they have already returned his earnest money deposit (EMD). 19. When enquired about the EMD, the learned Standing Counsel said that Nazar’s EMD was returned on 25.4.2017. On the other hand, Sri Abdulla submitted that the amount was credited to Nazar’s account on 11.5.2017. 20. Heard Sri Shiraz Abdulla M.S., the learned counsel for the petitioner, Sri Manoj Ramaswamy, the learned Standing Counsel for the Housing Board, and Sri Anil D. Nair, the learned counsel for the third additional respondent, besides perusing the record. ## **Issues:** 21. As set out in the introduction. WPC No.14966 of 2017 12 ## **Discussion:** ## **On Law:** 22. The adjudicatory ambit of Constitutional Courts over the contractual matters—commercial contracts, at that—has always been a contested judicial concept. The decisional dynamics have never been constant; they swing, and swing pulled by the peculiar facts of each dispute. Besides broad principles prescribing limited judicial intervention, we see no court proscribing any and every judicial intervention. 23. From the 1950s to mid-1970s, the constitutional Courts have adopted an approach of noninterference in contractual matters involving governments: the approach was, if one might say, passive. In _C. K. Achutan v. State of Kerala_[3] the Supreme Court held that when one person is chosen rather than another, the aggrieved party cannot claim the protection of Art.14 “because the choice of the person to fulfil a particular contract must be left to the Government.” To hold so, the Court felt that a contract from 3. AIR 1959 SC 490 WPC No.14966 of 2017 13 Government stands on a different footing from that of a private party. The same view stood echoed by this Court in _G.E. & E. Co._ . _v. Chief Engineer[4]_ 24. In the mid-1970s, the judicial attitude changed: that a welfare state cannot be equated with an individual unconcerned with the common good. So came the assertion that the State does not enjoy the same freedom as a private person does in awarding contracts because a government is always a government subject to the rule of law in all its activities. _M/s_ . _Eurasian Equipments and Chemicals Ltd. v. State of West Bengal_[5] is a case in point. 25. The constitutional Courts thereafter have continued to invoke Article 14 of the Constitution in all its myriad manifestations: _mala fides_ , corruption, favouritism, discrimination, arbitrariness, improper motives, non-application of mind, arbitrary or unreasonable contractual terms, non-publicity, and so forth, as listed out in . _G. J. Fernandez v. State of Karnataka_[6] > 4 . AIR 1974 Ker.23 5AIR 1975 SC 266 > 6AIR 1990 SC 958 WPC No.14966 of 2017 14 26. Judicial review vis-à-vis contractual matters gained acceptance, even ascendancy, with _Ramana Dayaram Shetty v. The International Airport Authority of India_[7] . What turned out to be a high water-mark in constitutional interpretation—reading due process into Indian Constitution—in _Maneka Gandhi v. Union of India_[8] was reiterated in _Ramana Dayaram Shetty_ , which listed out the conditions the executive is to fulfil to cross the hurdle of Article 14 of the Constitution before it could sustain an award of contract: (1) The government does not have an open and unrestricted choice in the matter of awarding contracts to whomsoever it likes. (2) _The government is to exercise its discretion in conformity with some reasonable non-discriminatory standards or principles._ (3) The government is bound by the standards laid down by it. (4) _The government can depart from these standards only when it is not arbitrary to do so and the departure is based on some valid principle which in itself is not “irrational, unreasonable or discriminatory.”_[9] (emphasis added) > 7. AIR 1979 SC 1628 > 8. AIR 1978 SC 597 > 9. As culled out in M.P. Jain’s Indian Constitutional Law (7th Ed. LexisNexis) p.1591 WPC No.14966 of 2017 15 27. Accepting that the judicial review of government contracts, even those of its instrumentalities, has been wellentrenched, we may examine why, when, and how the bids—even the lowest—could be rejected. It is almost prosaic to point out that a tenderer’s quoting the lowest price is no sure-fire method of his securing a contract. For an authority could reject the bid for good, compelling reasons and on sound grounds: the reasons genuine and verifiable, and the grounds rational and reasonable. 28. Examined deeper, the judicial trends are cyclical— sometimes the courts disfavor any judicial intervention in contractual matters, but other times, equally frequently, they assert Article 14’s application as all pervasive: the due process is not negotiable. Because Indian Constitutional Courts—unlike in other common-law jurisdictions, such as the USA—sit in panels rather than _en banc,_ we cannot attribute a single voice to all the panels of a court. For "the Court has held" is only a legal fiction; and a steady, unbending, uniform as an ensemble, judicial reasoning WPC No.14966 of 2017 16 throughout is a legal myth. The decisional vicissitudes and jurisdictional vacillations apart, we can easily discern from a plethora of precedents certain salient legal propositions justifying judicial review of contractual matters and the need for extreme caution and restraint on the courts’ part before they, if ever, upset the executive discretion in contractual matters. 29. Illegality, irrationality, and procedural impropriety amount to errors of law—jurisdictional errors, at that.[10] The authority can reject even the lowest bid. The courts can, then, interfere if the rejection is unreasonable, tested on the touchstone of _Wednesbury_ principles or arbitrariness under Article 14 of the Constitution. In _Union of India v. Dinesh Engineering Corporation_[11] , the Supreme Court has called the authority’s arbitrary action a “flagrant violation of the constitutional mandate of Art. 14.” 30. If the impugned action is arbitrary, unfair, or 10. Reliance Energy Ltd. and another v. Maharashtra State Road Development Corporation Ltd., (2007) 8 SCC 1 11. AIR 2001 SC 3887 WPC No.14966 of 2017 17 unreasonable, held the Supreme Court in _Kumari Shrilekha Vidyarthi v. State of U.P,_[12] the fact that the dispute also falls within the domain of a contract would not relieve the state of its obligation to comply with the basic requirements of Art. 14. According to the Court, an additional contractual obligation cannot divest the claimant of his right to question arbitrary administrative action as mandated under Art. 14 of the Constitution. For there is a duty on the State to act fairly in the matters of awarding contracts, too. 31. The Supreme Court has noticed the sphere of everexpanding executive activities. So it has observed in _ABL International Ltd. v. Export Credit Guarantee Corporation of India Ltd.,_[13] that, as “the State has descended into the commercial field, and giant public sector undertakings have grown up, the stake of the public exchequer is also large justifying larger social audit, judicial control and review by opening of the public gaze; these > 12. AIR 1991 SC 537 > 13. (2004) 3 SCC 553 WPC No.14966 of 2017 18 necessitate recording of reasons for executive actions including cases of rejection of highest offers”. 32. In this context, _Union of India v International Trading_ _Co._[14] has a sobering effect on the precedential ambivalence: “[t]he basic requirement of Article 14 is fairness in action by the State, and non-arbitrariness in essence and substance is the heartbeat of fair play. Actions are amenable in the panorama of judicial review only if the State must act validly for a discernible reason, not whimsically for any ulterior purpose. The meaning and true import and concept of arbitrariness is more easily visualized than precisely defined. Whether the impugned action is arbitrary is to be ultimately answered on the facts and circumstances of a given case.” ## **Precedents Cited at the Bar:** 33. We may, now, examine the precedents relied on by the counsel at the Bar. Cochin International Airport Ltd., (CIAL) wanted to set up a new international airport. It invited offers by 14. (2003) 5 SCC 437 WPC No.14966 of 2017 19 writing letters to some companies having experience in the field. CIAL permitted Air India, one of the bidders, to revise its offer. A rival company questioned it. 34. In the above factual context, in _Air India Ltd.,_ the Supreme Court has observed that the award of contract—whether by a private party, a public body, or the State—is essentially a commercial transaction. In deciding, the State can choose its own method. It can fix its own terms of the invitation to tender, and that is not open to judicial scrutiny. It can negotiate before finally accepting one of the offers made to it. Price need not always be the sole criterion for awarding a contract. It may grant any relaxation, for _bona fide_ reasons, if the tender conditions permit such a relaxation. It may not accept the offer even though it is the highest or the lowest. 35. Here, we must not lose sight of the fact that TP Constructions was chosen for none of the reasons stated in _Air India Ltd_ .: not that the third respondent had been chosen because WPC No.14966 of 2017 20 of his expertise or any particular advantage that option would entail. On the contrary, he was chosen by default because Nazar, according to the Housing Board, failed to qualify. 36. In another case, the petitioner made a mistake while submitting his bid. He contended that it was a minor mistake and he ought to have been allowed to correct it. He had a counter allegation, too: the successful bidder could correct his mistake. In _Thomas P.C. & Company_ , a learned Single Judge has followed _Air India Ltd.,_ and held that once the mistake is substantial, it cannot be cured unless such power vests with the company that invited the tenders. 37. Indeed, TP Constructions would have us conclude that this Court does not favour interfering in tender matters, for frequent judicial interventions will stultify the executive efforts to implement the policies and projects. Though not entirely acceptable, there is, I must say, an element of truth in TP Constructions’ submission. Judicial intervention in contractual WPC No.14966 of 2017 21 matters is not for mere asking. It takes more than the officialdom’s usual omissions and commissions for the Constitutional Courts to interfere. But that restraint does not stretch to the extent of selfabnegation: a strict policy of no interference. So, the Courts have repeatedly held that “tenders will not escape the scrutiny of judicial review.” The Courts, in fact, have affirmed that they exercise the power of judicial review, if the authority’s approach is arbitrary, _mala fide_ , or whimsical: choosing a favoured one. And the authority’s decision-making process should clearly show that the maladies are kept at bay. 38. On how the Courts can exercise the power of judicial review in the limited confines of contractual disputes, _Tata Cellular v. Union of India_[15] has reiterated the bounds of this extraordinary remedy: (i) there should be judicial restraint in review of administrative action; (ii) the court should not act like court of appeal—it cannot review the decision but can only review > 15 . (1994) 6 SCC 651, as quoted in _JSW Infrastructure Ltd. v. Kakinada Seaports Ltd._ , (2017) 4 SCC 170 WPC No.14966 of 2017 22 the decision making process (iii) the court rarely has the expertise to correct such technical decisions; and (iv) the employer must have play in the joints i.e., necessary freedom to take administrative decisions within certain boundaries. 39. A mere disagreement with the decision-making process or the decision of the administrative authority, the Supreme Court clarified, is no reason for a constitutional Court to interfere. The threshold of _mala fides_ , intention to favour someone or arbitrariness, irrationality or perversity must be met before the constitutional Court interferes with the decision-making process or the decision.[16] In other words, evaluating tenders and awarding contracts are essentially commercial functions. Principles of equity and natural justice stay far away. If the decision relating to awarding the contract is _bona fide_ and is in public interest, courts will not subject the decision to judicial review, even if a procedural aberration, or error in assessment, or prejudice to a tenderer is > 16. Afcons Infrastructure Ltd. v. Nagpur Metro Rail Corporation Ltd. and Anr. (AIR 2016 SC 4305) WPC No.14966 of 2017 23 made out.[17] ## **On Facts:** ## **What is the Factual Setting of this Case?** 40. Abdul Nazar responded to the Ext.P1 tender notification issued by Housing Board. Two other persons also tendered their bids. The Housing Board's list of valid bids displayed on its website showed all the three names, but while its considering the technical bids, the Board did not consider Abdul Nazar’s bid. The technical-bid-opening summary, seen from the website, revealed that Nazar's bid was rejected "due to non-submission of valid registration certificate." Then, the Board went on to scrutinise the other two bids. The reason for rejection gathered over telephone— of course, the Board denies this assertion—Nazar, on 25.04.2017, sent a scanned colour-copy of the registration certificate signed by the renewing authority, the Superintending engineer: the signature being in florescent ink. The very next day he sent a legal notice. 17. Jagdish Mandal v. State of Orissa: (2007) 14 SCC 517 WPC No.14966 of 2017 24 The Board opened the financial bid two days later: 27.04.2017. Nazar filed the writ petition the next day before a vacation court. ## **The Conditions to be Complied with:** 41. The procurement notice inviting tenders concerns certain civil works: construction of indoor auditorium for LBS College of Engineering, and other civil works, including water supply and sanitary installation works. The estimated cost of the work is Rs.6,50,09,759/-, and the earnest money to be deposited (EMD) is Rs.20 lakh. 42. Exhibit P2 extract of tender document lists out additional documents to be submitted through online/speed post. The first of the seven documents is a copy of Registration Certificate attested by a Gazetted Officer of a government department with the validity and class of registration. Every tenderer must upload a scanned copy of this document online. The tenderers should also send a copy to a speed post. 43. Exhibit P3 is a scanned copy of the registration WPC No.14966 of 2017 25 certificate. To the naked eye, The Superintending Engineer’s signature is almost invisible—I say _almost invisible_ because intense scrutiny, rather than a casual glance, reveals a faint trace of the signature, at least the initial portion. Exhibit R1 (B) filed by the Housing Board is identical to Exhibit P3. 44. Exhibit P6 is the coloured scanned copy of the same certificate, with the Superintending Engineer’s signature in green florescent ink. The signature, I must say, reveals itself in all its glory, in colour, in exhibit P6. I must also acknowledge that the officials initially did not have the advantage of the colour copy but had to assess only the uploaded scanned copy. ## **Housing Board’s Bona fides:** 45. At the earliest point in time, without even the court’s insisting, the Housing Board submitted the entire record connected with the contract for the Court’s scrutiny. To give credit where credit is due, I place on record the Court’s appreciation of the officials’ conduct. WPC No.14966 of 2017 26 ## **The Petitioner’s Diligence and Compliance:** 46. When I went through the record, it revealed unmistakably that the uploaded copy is unclear, but what was later supplemented or supplied by Nazar leaves no doubt in anybody’s mind that the certificate bore the officer’s signature. If the officials had no other material at their disposal by the time they decided to award the contract to TP Constructions, this Court would have been reluctant to interfere. But, as seen from the sequence of events set out above, there was hardly any lapse on Nazar’s part: the very same day—25.04.2017—when his name was excluded from the technical bid, he contacted the officials over phone and allegedly mailed them a scanned colour-copy of the document. Of course, the officials do deny that they had ever received any colour copy. 47. That apart, the next day, Nazar sent a legal notice, explaining his stand: in paragraph (c) of exhibit P7 notice, Nazar asserted that the copies of the certificate submitted by him do WPC No.14966 of 2017 27 contain the officer’s signature. Also, he has pleaded at the earliest that he had already sent a scanned copy of his original licence through email to the Housing Board. He further pleaded with the officials that the emailed copy must have been clear and unambiguous because it was scanned from the original. 48. While discussing the precedential on the judicial review of contractual matters, we have gathered that the Supreme Court has held that the judicial intervention largely depends on the facts and circumstances of each case. In other words, the Apex Court has shunned any sweeping observations; nor has it disfavoured judicial intervention under all circumstances. True, there is no gainsaying the fact that the officials should have sufficient play in the joints—an expression now sounds almost prosaic—in the matters of commercial contracts. At the same time, we must also acknowledge that no person should suffer for no fault of his. Here, Nazar’s conduct is blameless; on the contrary, diligent. He had sent all the material at his disposal before the authorities could take a WPC No.14966 of 2017 28 decision. He had even approached the Court before the officials moved any further in awarding the contract to TP Constructions. ## **The Validity of Licence:** 49. Indeed, the Housing Board has contended that Nazar had no valid license by the time he submitted his tender because his license expired on 31/03/2017. In defence, Nazar asserts that he had his licence renewed on 28/03/2017 itself—before he could submit his tender. He has even taken a certificate from the superintending engineer on 12/05/2017. As seen from Exhibit P10, the Superintending Engineer averred that he renewed the petitioner’s licence on 28/03/2017. Nazar also relies on exhibit P9 GO, through which the government extended the time for renewing the licence from 01/04/2017 to 30/06/2017. That means, even without renewal, Nazar’s licence was valid and subsisting by the date he submitted his tender. And it fulfils the stipulated condition. We must presume that the officials of the housing board know of the GO, a public document. WPC No.14966 of 2017 29 50. So, the upshot of the discussion is that Nazar’s license was valid as on the date he submitted his tender—even without the renewal. In other words, we may leave aside, safely, the controversy about the clarity of the official’s signature in exhibit P3 licence. ## **Fluorescent Ink:** 51. In passing, I may have a word on the genuineness of Nazar’s plea about the invisible signature on the document. Anyone who uses the fluorescent ink, commonly found in highlighters, knows rather well that the highlighted portions of any written material become either invisible or dark if scanned. If the marking is yellow, the scanned copy will have dark lines, and other colours remain, mostly, invisible. ## **Public Interest and Individual Rights:** 52. Sri Anil D. Nair, the learned counsel for TP Constructions, has persistently submitted that any adverse adjudication against the Housing Board's granting the work to TP WPC No.14966 of 2017 30 Constructions would affect the public interest. Even if the authorities have failed to measure up to the standard of procedure in awarding the work, judicial review, he contends, at this stage affects public interest and common good, for the officials' action . does not suffer from any _mala fides_ 53. In other words, Sri Nair insists that the individual right should yield to the collective one—the common good. The problem, then, is pitting public interest against the individual right. Stretched further and viewed shorn of the amorphous commonwheal, which usually the State represents, Sri Nair’s contention puts in perspective the debate over the individual right versus the collective might. Is there any conflict? If there is, which should prevail? Or, can they coexist? 54. Our Constitution is an amalgamation: it contains institutional designs, it acknowledges individual aspirations, it adumbrates administrative goals, it prescribes policy prerogatives, fiscal priorities—the machinery, the mechanism, and the WPC No.14966 of 2017 31 maintenance. 55. The individual and the society on the scales of adjudication are sought to be placed at the two extremes. Neither can be subordinated to, or superordinated over, the other. It is time judicial perspective found its median, shunning polarisation on either extreme. The community should act to protect an individual; no individual must be sacrificed at the altars of the society. If the individual is made the sacrificial lamb for all the perceived, and imaginary too, threats to the society, what results is the tyranny of the majority. 56. Speaking of rights, the Constitution is not an empowering instrument. It always concerns with limiting the governmental powers vis-à-vis an individual: the individual is its existential justification. Society, at best, is an aggregation of these individuals. Insisting, as an invariable principle, that the individual should yield to the society is an ideological incongruent: felling trees for protecting a forest, if ever there remains one without trees. WPC No.14966 of 2017 32 57. Ayan Rand, in her book _The Virtue of Selfishness[18]_ , observes that “since there is no such entity as ‘the public,’ since the public is merely a number of individuals, any claimed or implied conflict of ‘the public interest’ with private interests means that the interests of some men are to be sacrificed to the interests and wishes of others.” In _McDonald v. City of Chicago_[19] , Justice John Paul Stevens, in his dissenting judgment, acknowledged the schism between the individualism and collectivism: “More fundamental rights may receive more robust judicial protection, but the strength of the individual’s liberty interests and the State’s regulatory interests must always be assessed and compared. No right is absolute.” 58. So Sri Nair’s assertion that the Court’s upsetting the award of contract entails public inconvenience or saddles the exchequer some extra money can be persuasive, but not preventive. Given the unassailable right of Nazar here, I do not think that the > 18 The Virtue of Selfishness, A New Concept of Egoism, (1964) Ebook. 19561 U. S. ____ (2010) WPC No.14966 of 2017 33 supposed public interest or inconvenience should put paid to his legitimate claim. ## **The Alternative Views:** 59. To sum up, we can appreciate Nazar’s grievance singularly: that the officials have acted arbitrarily in rejecting his bid with no justification. Put differently, the officials’ rejecting Nazar’s tender is without application of mind. First, though Nazar’s certificate, initially uploaded by him, was indistinct, he supplied to the Housing Department other copies of the certificate, wasting no time. Those documents did reveal the Superintending Engineer’s signature. But there is an element of controversy about how and when Nazar submitted those documents. True, his exhibit P7 legal notice stands undenied, though his emailing another copy stands denied. While judicially reviewing an official act, the court is averse to adjudicating on disputed questions of fact. So, we need not fret over the truth of rival submissions on whether Nazar has submitted convincing proof of a duly renewed certificate. I may WPC No.14966 of 2017 34 hasten to add that he did make every effort at the earliest to convince the officials that he had a valid license. But let the benefit of doubt go to the Housing Board. 60. In the alternative, as is evident from exhibit P9 GO, the validity of Nazar’s license stood extended up to 30/06/2017. So, there was no occasion, much less justification, for the Housing Board authorities to reject Nazar’s bid. On this count, Nazar’s claim must be accepted. ## **Third Party Interest:** 61. Indeed, on 15.05.2017 the Housing Board entered into a contract with T. P. Construction. But that awarding of contract was a _lis pendence_ development; it cannot prejudice the claim of Nazar, who has always been diligent in asserting his right and pursuing his remedies. 62. Further, the Housing Board returned Nazar’s EMD—on 11.05.2017 as asserted by him, or on 25.04.2017 as asserted by T. - P. Construction. Once, the Court upholds Nazar’s claim, the WPC No.14966 of 2017 35 Housing Board’s returning the EMD pales into insignificance. 63. Here, I may as well consider TP Construction’s alternative contention: if this Court, for whatever reason, decides to hold in Nazar’s favour, the only course of action open to it is to order re-tendering. I am afraid it may not be the only course available. Both the Housing Board and TP Construction have gone on record that all further proceedings in the matter were stayed at the earliest; so nothing moved further, save the award of contract to TP Construction. 64. In these circumstances, ordering a fresh tendering process, I reckon, is time-consuming, not to speak of waste of public money. In the alternative, to serve the interest of Justice, first, this Court holds and declares that the course adopted by the Housing Board in rejecting Nazar’s bid and preferring TP Construction’s cannot be sustained and accordingly declared arbitrary and illegal. Second, as a consequence, this Court directs the respondent Housing Board to resume scrutinising the tenders, WPC No.14966 of 2017 36 including Nazar’s, from the stage of technical bids and proceed further under the terms of the Exhibit P1. ## **Result:** With the above directions, I allow the writ petition. No order on costs. Sd/- **Dama Seshadri Naidu, Judge** css/ true copy P.S.TO JUDGE