Mohammed Fazil .H. v. Southern Railway and Others (WP(C) 1234 of 2023)

# **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** # **`PRESENT`** ## **`THE HONOURABLE MR.JUSTICE VIJU ABRAHAM`** ``` WEDNESDAY, THE 2[ND] DAY OF AUGUST 2023 / 11TH SRAVANA, 1945 WP(C) NO. 1234 OF 2023 ``` ## **`PETITIONER:`** ``` MOHAMMED FAZIL .H.,AGED 44 YEARS, S/O.HAMZA, PROPREITOR, HYFA CATERING, NO.676/8, E.M.M. MAIN STREET, CHENNIMALAI ROAD, ERODE - 638001 ``` ``` BY ADVS. K.SANEESH KUMAR V.B.SANTHINI ``` ## **`RESPONDENTS:`** - **`1 SOUTHERN RAILWAY REPRESENTED THROUGH ITS, CHIEF COMMERCIAL MANAGE HEADQUARTERS OFFICE, COMMERCIAL BRANCH, CHENNAI-600 003`** - **`2 THE SENIOR DIVISIONAL COMMERCIAL MANAGER SOUTHERN RAILWAY, DIVISION OFFICE, COMMERCIAL BRANCH, (PALAKKAD DIVISION) PALAKKAD DISTRICT - 678002`** - **`3 THE PRINCIPAL CHIEF COMMERCIAL MANAGER HEADQUARTERS OFFICE, COMMERCIAL BRANCH, CHENNAI - 600003`** - **`4 THE ASSISTANT COMMERCIAL MANAGER SOUTHERN RAILWAY, DIVISION OFFICE, COMMERCIAL BRANCH, (PALAKKAD DIVISION) PALAKKAD DISTRICT – 678002`** WP(C)No.1234 of 2023 2 - **`5 THE UNION OF INDIA REPRESENTED BY THE SECRETARY, MINISTRY OF RAILWAYS, CENTRAL SECRETARIAT, NEW DELHI-110001`** ``` 6ABDUL KAREEM NADAVATH VALAPPIL, AGE NOT KNOWN, FATHER’S NAME NOT KNOWN, 'FAJINAS', THALASSERY.P.O, KANNUR DISTRICT- 670101 R1 TO R5 BY SRI.MANU S. DSG OF INDIA R6 BY ADVS.ANIL S.RAJ K.N.RAJANI(K/001295/1999) ANILA PETER(K/660/2006) RADHIKA RAJASEKHARAN P.(R-718) MUHAMMED HARIS K.K.(K/561/2021) SIMI S. ALI(K/2275/2021) SNEHA S. MENON(K/000594/2020) ``` ``` THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 02.08.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` WP(C)No.1234 of 2023 3 ## **VIJU ABRAHAM, J.** **................................................................. W.P.(C) No.1234 of 2023 .................................................................** Dated this the 2[nd] day of August, 2023 ## **JUDGMENT** Petitioner is a catering contractor and proprietor of a proprietary concern by name 'Hyfa Catering' engaged in the business of conducting refreshment rooms at railway stations, catering services under the Southern Railway as well as at various zones under the Indian Railways and the petitioner has been in the said business for more than 10 years. The Southern Railway, 1[st] respondent had called for tender for providing catering services on General Minor Units and the petitioner had participated in the tender for “ _Catering Stall No.MAJN 49 at Mangalore Junction Railway Station Platform No.1_ ”. Petitioner was informed as per Ext.P3 communication that the technical commercial bid submitted by him was found to be technically suitable and when the financial bid was opened on 01.12.2022 the petitioner's bid was found to be the highest bid and ranked as H1 which denotes the 1[st] rank and the bid amount is Rs.18,75,555/-, whereas the bid submitted by the second highest bidder, who is the 6[th] respondent herein, was for an amount of Rs.15,43,227/-. The petitioner was eagerly waiting for the award to be WP(C)No.1234 of 2023 4 issued in his favour. Even after a lapse of time no information or any notice was issued to the petitioner. On enquiry by the petitioner it was revealed from the office of the 2[nd] respondent that petitioner's highest bid could not be considered since he was debarred from participating in the bidding process for similar contract for a period of five years. Petitioner submits that as per Ext.P9 the award has been granted in favour of the 6[th] respondent. The debarment for five years from participating in tenders is absolutely without any basis inasmuch as though in Ext.P5 dated 18.10.2022 it is stated that the petitioner is debarred from participating in the bidding process for similar future licence/contract over zonal railway for a period of five years since the petitioner has failed to remit an amount of Rs.5,32,454/- towards fourth licence fee of the MPS stall he has already auctioned, a clarification has been issued as per Ext.P6 that the said debarment is applicable over Southern Central Railway only and not in respect of any other zone. The said aspect was further clarified by Ext.P7 communication. Petitioner further submits that the mode of Ext.P1 tender is e-tender and the date of uploading the e-tender is on 05.09.2022 and date of closure is on 28.09.2022. Whereas Ext.P5 letter, whereby the petitioner was debarred from participating in the bidding process was issued only on 18.10.2022, ie., much after the date of closure of tender. Petitioner submits that Ext.P5 order of debarment was issued subsequent to the closing of the WP(C)No.1234 of 2023 5 tender and he had no occasion to make a mention about the debarment in his tender document for the said reason. It is further submitted by the petitioner that even the debarment as per Ext.P5 will not affect the right of the petitioner to participate in the tender and for consideration of his tender in view of Exts.P6 and P7 which specifically mandates that the debarment is applicable only over Southern Central Railway. Petitioner also submits that even thereafter his tenders were accepted in respect of other tenders floated by the Railways as is evident from Ext.P10. 2. A detailed statement has been filed by respondents 1 to 5 wherein it is stated that the price bids were opened on 01.12.2022 and subsequent to that it was noticed that the petitioner who is the proprietor of M/s.Hyfa Catering was debarred from participating in catering licences over Railways and IRCTC for a period of five years owing to default in payment of railway dues. Relying on Clause 2.1.21 of the instructions to bidders it is the submission of the learned Deputy Solicitor General appearing for respondents 1 to 5 that the bidder is fully responsible for all the informations submitted and the Railway reserves the right to reject the bid if it is found that bidder has given wrong information. In Clauses 12, 19 and 24 of Annexure-A1 covering letter comprising the bid which is a mandatory document submitted along with the bid the petitioner himself has declared that he is not a defaulter and he is not debarred from participating in bidding process of catering WP(C)No.1234 of 2023 6 service in Indian Railways. Further an affidavit on stamp paper which is also a mandatory document (Annexure-A8) in which the petitioner has stated that he is solvent and there are no pending dues to Railways and that he has not been debarred from participation in tenders by any Zonal Railway/IRCTC. He has also declared that if any of the information submitted by the tenderer is found to be incorrect/false, either before or after the award of licence, the same shall be treated as “material breach and would result in rejection of the bid or termination of the licence, as the case may be, and will be debarred/blacklisted from participating in future allotment of catering units on any Zonal Railway/IRCTC. Therefore it is submitted by the learned Deputy Solicitor General that since there was dues to the Railways and a false affidavit and information has been submitted along with the e-tender the bid submitted by the petitioner was not considered and he was not awarded the work. 3. A detailed counter affidavit has been filed by the 6[th] respondent wherein it is stated that the Southern Central Railway has debarred the petitioner and due to the said debarment his bid cannot be considered. It is submitted that an amount of Rs.5,32,454/- is due to the Southern Central Railway from the petitioner and on that count also he is ineligible to participate in the tender. It is the case of the 6[th] respondent that pursuant to the issuance of Ext.P9 by the 2[nd] respondent he has WP(C)No.1234 of 2023 7 remitted an amount of Rs.15,43,227/- vide Demand Draft dated 27.12.2022 and that he has established necessary infrastructure to open and operate a catering stall by spending huge amounts as is evident from Ext.R6(b). It is further submitted that there is delay in approaching the Court since the award as per Ext.P9 in favour of the 6[th] respondent was on 08.12.2022, but the writ petition was filed only on 12.01.2023. As evident from 2.1.2 of Chapter 2: Instructions to Bidders, which forms part of Ext.P2, the petitioner having registered on the e- tendering portal can participate in tendering process and can witness various activities of the process. On the basis of the same it is contended that if the petitioner seeks to challenge the tender awarded in favour the 6[th] respondent, it should have been done within a reasonable time. 4. I have considered the rival contentions of both the parties. A perusal of Ext.P5 would reveal that an amount of Rs.5,32,454/- is due from the petitioner in respect of another tender granted in his favour and the dues being the fourth licence fee for the MPS stall he has already auctioned. In the statement filed by respondents 1 to 5 also it is brought to the notice of this Court that there was default in payment of licence fee towards the Indian Railways. The covering letter comprising the bid, Annexure A/1 of Ext.P2, is in the form of an affidavit wherein a declaration has been given by the tenderers that they have no dues WP(C)No.1234 of 2023 8 pending to the Railways and further that they have not been debarred or blacklisted from participating in bidding process. Chapter 2 : Instructions to bidders forms part of Ext.P2 which specifically mandated that if any material misrepresentation is made by the bidder it will lead to disqualification/rejection of the tender. The only contention taken by the petitioner based on Exts.P6 and P7 is that even though he was debarred from participating in the tenders due to non-payment of dues, the respondents have clarified that the said debarment will only be applicable towards the future catering contract/licence tenders for Southern Central Railway and since Ext.P5 debarment letter is dated 18.10.2022 which is much after the date of closure of Ext.P1 tender on 28.09.2022 the petitioner cannot be found fault with for not intimating that he has been debarred as per Ext.P5. But one crucial aspect to be noted is that there are liabilities due from the petitioner at the time when the petitioner submitted his tender and as per the tender instructions he is bound to disclose the said fact in the tender document and it is specifically mandated in Ext.P2 general conditions that any misrepresentation will lead to disqualification of the bidder. Admittedly in the bid documents petitioner has made a declaration that he has no dues pending to the Railways but Exts.P5 to P7 clearly show that the petitioner was having dues to the Railways and therefore the affidavit filed by the petitioner that there are no pending dues to the Railways WP(C)No.1234 of 2023 9 appears to be a material suppression. It is true that the petitioner cannot state in the affidavit that he has been debarred from participating in the tender inasmuch as the said debarment order was issued only after closure of the tender on 28.09.2022, but as regard the dues due to the Railways there was material suppression on the part of the petitioner at the time of submission of the tender which is also a reason stated for not accepting the bid of the petitioner. It is seen that the 6[th] respondent has already paid the bid amount of more than Rs.15 lakhs on 27.12.2022 and has made infrastructure facilities for the establishment of the stall as is evident from Ext.R6(b). Going by Clause 2.1.2 of Ext.P2 tender document, the tenderer can access the e-tender portal and participate in the tendering process and can witness various activities of the process. Going by Clause 2.1.9 of Ext.P2 tender document, the tenderers are advised to keep in touch with e-tendering portal for updates/corrigendum. By Ext.P9 communication dated 08.12.2022, the 6[th] respondent’s tender was accepted but the writ petition challenging the same was filed only on 12.01.2023, by which time the 6[th] respondent has already paid the bid amount and also made necessary arrangements for conduct of the stall. The Apex Court in _**Ramana Dayaram Shetty v. International Airport Authority of India and others, AIR 1979 SC 1628**_ , even after finding that the acceptance of tender was invalid as being violative of Article 14 of the Constitution WP(C)No.1234 of 2023 10 and being an arbitrary action declined to interfere in the matter for the reason that there was delay in approaching the court challenging the award of tender and that the successful tenderer has incurred considerable expenditure in making arrangements to undertake the tendered work. In the present case, I have already entered a finding that there is violation of the tender conditions, but even accepting the case of the petitioner, this Court will be precluded from granting any relief to the petitioner in the light of the judgment in _**Ramana Dayaram Shetty**_ ’s case supra. Taking all these aspects into consideration I am of the opinion that the rejection of the tender of the petitioner need not be interfered with. The above writ petition is accordingly dismissed. Sd/- **VIJU ABRAHAM** **JUDGE** cks WP(C)No.1234 of 2023 11 ## **`APPENDIX OF WP(C) 1234/2023`** ``` PETITIONER EXHIBITS ``` - `ExhibitP1 A TRUE COPY OF THE TENDER NOTICE INVITING THE BID ISSUED BY SOUTHERN RAILWAY-PALAKKAD DIVISION IN RESPECT OF THE CATERING STALL NO.MAJN/49 ON PLATFORM NO.1 AT MANGALORE JUNCTION RAILWAY STATION DATED NIL.` - `ExhibitP2 A TRUE COPY OF THE BID DOCUMENT FOR PROVISION OF CATERING SERVICES ON GENERAL MINOR UNIT ISSUED BY THE SOUTHERN RAILWAY- PALAKKAD DIVISION DATED NIL.` - `ExhibitP3 A TRUE COPY OF THE MAIL COMMUNICATION AS RECEIVED BY THE PETITIONER ON 1.12.2022.` - `ExhibitP4 A TRUE COPY OF THE DETAILS OF OPENING OF FINANCIAL BID WHICH OPENED ON 1.12.2022.` - `ExhibitP5 A TRUE COPY OF THE DEBARMENT LETTER ISSUED FROM THE DIVISION OFFICE, GUNTAKAL DATED 18.10.2022.` - `Exhibit P6 A TRUE COPY OF THE LETTER OF` - `COMMUNICATION ISSUED BY THE OFFICE OF THE PRINCIPAL CHIEF COMMERCIAL MANAGER, SOUTH CENTRAL RAILWAY DATED 17.11.2022` - `Exhibit P7 A TRUE COPY OF THE LETTER DATED` - `5.12.2022 ISSUED BY THE 1ST RESPONDENT.` - `Exhibit P8 A TRUE COPY OF THE REPRESENTATION SUBMITTED BEFORE THE 3RD RESPONDENT ON 15.12.2022.` - `Exhibit P9 A TRUE COPY OF THE LETTER OF AWARD ISSUED BY THE OFFICE OF THE 2ND RESPONDENT DATED 8.12.2022` - `Exhibit P10 A true copy of the Letter of Acceptance` WP(C)No.1234 of 2023 12 ``` for the tender of Award of License issued by the Palakkad Divisional office, Commercial Branch dated 4.5.2023. ``` ``` RESPONDENT EXHIBITS ``` ``` Exhibt R6(a)true copy of the covering letter submitted by the sixth respondent to the deputy SMT/Commercial , Manglore Junction dated 27.12.2022 Exhibit R6(b)true copy of the photographs evidencing the infrastructure established by the 6th respondent . ```