M/S M.D. Esthappan Infrastructures Pvt. Ltd. v. The General Manager, Southern Railway & Others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR.JUSTICE N.NAGARESH** ## **THURSDAY, THE 03RD DAY OF DECEMBER 2020/12TH AGRAHAYANA, 1942** ## **WP(C).No.34126 OF 2019(M)** ## **PETITIONER:** **M/S M.D. ESTHAPPAN INFRASTRUCTURES PVT. LTD., OFFICE AT ROOM NO.144, NEAR ST. JOSEPH HIGH SCHOOL, RAILWAY STATION NAGAR, ANGAMALY, ERNAKULAM, REPRESENTED BY ITS DIRECTOR, JOSY STEPHEN, AGED 51 YEARS, S/O.M.D. ESTHAPPAN, MOOLAN HOUSE, ANGAMALY, ERNAKULAM DISTRICT-683572.** **BY ADVS. SRI.S.SHANAVAS KHAN SMT.S.INDU** ## **RESPONDENTS:** - **1 THE GENERAL MANAGER, SOUTHERN RAILWAY, HEAD QUARTERS OFFICE, PARK TOWN, CHENNAI-600003.** - **2 THE CHIEF ENGINEER CONSTRUCTION(NORTH), SOUTHERN RAILWAY, ERNAKULAM-682016.** - **3 THE DEPUTY CHIEF ENGINEER(CONSTRUCTION), SOUTHERN RAILWAY, CALICUT-673001.** - **4 THE DEPUTY FINANCIAL ADVISOR AND CHIEF ACCOUNTS OFFICER(CONSTRUCTION), SOUTHERN RAILWAY, ERNAKULAM-682016** - **5 THE DEPUTY CHIEF ENGINEER, ELECTRICAL (CONSTRUCTION), SOUTHERN RAILWAY, ERNAKULAM-682016.** - **6 SURABHI EARTH MOVERS, HIGH SCHOOL ROAD, KOOTHATTUKULAM, ERNAKULAM-686662.** WP(C) No.34126/2016 : 2 : **R1-5 BY ADV. SMT.SUMATHY DANDAPANI (SR.), SC R1-5 BY SRI.B.RAJESH, SC, RAILWAYS R6 BY ADV. SRI.K.BABU THOMAS R6 BY ADV. SMT.MARYKUTTY BABU** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 03-12-2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** WP(C) No.34126/2016 : 3 : ## **N. NAGARESH, J.** ````````````````````````````````````````````````````````````` ## W.P.(C) No.34126 of 2019 ````````````````````````````````````````````````````````````` _Dated this the 3[rd] day of December, 2020_ ## **J U D G M E N T** ~ ~ ~ ~ ~ ~ ~ ~ ~ The petitioner is a Company engaged in the field of construction activities. The petitioner is before this Court seeking the following reliefs:- (i) Declare that petitioner is entitled to be awarded the work of 'Shornur-Mangalore Section – Pro.Reconstruction of Branch No.1162 at Kilometre 804/500-700 as 14x12.20 metre PSC-1 girder and slab and BR No.1163 at Km 805/00-100 as 1x15.0m PSC-1 girder and slab between Cheruvathoor and Nileeswaram stations, earth work and blanketing for formation on approaches, collection of ballast, linking of track and other protective works' mentioned in Ext.P1 as he is the lowest tenderer in respect of the said work. (ii) Declare that invitation of 6[th] respondent, who is the second lowest tenderer in respect of the work of 'Shornur-Mangalore Section–Pro. Reconstruction of Branch No.1162 at Kilometre 804/500-700 as 14x12.20 metre PSC-1 girder and slab and BR No.1163 at Km 805/00-100 as 1 x 15.0m PSC-1 girder and slab between Cheruvathoor and Nileeswaram stations, earth work and blanketing for formation on approaches, collection of ballast, linking of track and other protective works”, overlooking the petitioner's claim is illegal, arbitrary and unsustainable. WP(C) No.34126/2016 : 4 : (iii) Issue a Writ of mandamus or any other Writ, Order or direction directing the respondents 1 to 5 to refrain from proceeding with the allotment of work of 'Shornur-Mangalore Section – Pro. Reconstruction of Branch No.1162 at Kilometre 804/500-700 as 14x12.20 metre PSC-1 grider and slab and BR No.1163 at Km 805/00-100 as 1x15.0m PSC-1 girder and slab between Cheruvathoor and Nileeswaram stations, earth work and blanketing for formation on approaches, collection of ballast, linking of track and other protective works' mentioned in Ext.P1 to the 6[th] respondent. (iv) Issue a Writ of mandamus or any other Writ, Order or direction directing the respondents 1 to 5 to finalise the work of 'Shornur-Mangalore Section – Pro.Reconstruction of Branch No.1162 at Kilometre 804/500-700 as 14x12.20 metre PSC-1 girder and slab and BR No.1163 at Km 805/00-100 as 1x15.0m PSC-1 girder and slab between Cheruvathoor and Nileeswaram stations, earth work and blanketing for formation on approaches, collection of ballast, linking of track and other protective works' mentioned in Ext.P1 in favour of petitioner. 2. The petitioner states that the petitioner submitted Ext.P1 e-tender floated by the Southern Railway, in respect of work of 'Shornur-Mangalore Section – Pro. Reconstruction of Branch No.1162 of Kilometre 804/500-700 as 14x12.20 metre PSC-1 girder and slab and BR No.1163 at Km 805/00100 as 1x15.0 m PSC-1 girder and slab between Cheruvathoor and Nileeswaram stations, earth work and blanketing for formation on approaches, collection of ballast, WP(C) No.34126/2016 : 5 : linking of track and other protective works'. The petitioner was the lowest tenderer and the 6[th] respondent was the second lowest. However, the tender made by the petitioner has been illegally rejected and respondents 1 to 5 invited the 6[th] respondent for negotiations overlooking the claim of the petitioner. 3. The petitioner states that the petitioner's bid has been rejected for the reason that the petitioner did not produce Ballast Certificate. Rejection of the petitioner's bid on that ground is highly arbitrary and illegal. The petitioner would rely on Ext.P1 tender document in which it has been stated that uploading of the document Ballast Test Certificate, is optional. When respondents 1 to 5 specifically made uploading of Ballast Test Certificate optional, respondents 1 to 5 cannot subsequently turn around and say that uploading of that certificate is mandatory. 4. The petitioner will further contend that invitation of 6[th] respondent for negotiation is _per se_ illegal because in any e-tendering process, negotiations are not contemplated. The WP(C) No.34126/2016 : 6 : action of respondents 1 to 5 in holding negotiations with the 6[th] respondent would go against the guidelines laid down by the Central Vigilance Commission in that regard, contended the petitioner. 5. Respondents 1 to 5 resisted the writ petition filing counter affidavit. Respondents 1 to 5 stated that Railway Board has laid down certain specifications for the track ballast and condition, as per which the tenderer is required to submit the original test report of ballast as per provisions of specification of track ballast IRS-G-June, 2016, failing which the offer shall be summarily rejected. Respondents 1 to 5 specifically denied the contention of the petitioner that for work costing ₹5 Crores and the cost of ballast supply is less than ₹50 lakhs, the uploading of Ballast Test Certificate is optional. According to the respondents, irrespective of the quantity of amount involved, uploading of Ballast Test Certificate is mandatory. 6. The 6[th] respondent also opposed the writ petition filing counter affidavit. The 6[th] respondent pointed out that WP(C) No.34126/2016 : 7 : as per Clause 12 of the bid document marked as Ext.R6(a), every tenderer is required to submit the original test report of ballast, failing which the offer shall be summarily rejected. Since the petitioner failed to submit the original test report of ballast, its bid was invalid and consequently, the 6[th] respondent was declared as eligible and qualified bidder. 7. The 6[th] respondent further contended that the Railway has no jurisdiction to consider the invalid price bid made by the petitioner. The 6[th] respondent denied the allegation of the petitioner that the requirement of production of test certificate of ballast is optional. Whether it is mandatory or optional will depend on the nature of the work involved. 8. I have heard the learned counsel for the petitioner, learned Standing Counsel appearing for respondents 1 to 5 and counsel for the 6[th] respondent. 9. The fact based on which the petitioner challenges rejection of its bid, is that page 22 of Ext.P1 tender document, under the head ‘Technical Compliances' provides WP(C) No.34126/2016 : 8 : that Ballast Test Certificate is an optional document for uploading along with the tender. Since uploading of Ballast Test Certificate is made optional, the petitioner did not upload the same. Rejection of petitioner’s tender for the said reason, is arbitrary and illegal. The petitioner has a further case that production of Ballast Test Certificate in the case at hand is optional since the work involved is mainly civil in nature. 10. It is true that in Ext.P1, under the head 'TechnicalCompliances', Ballast Test Certificate is shown as optional document for uploading. The name of work as described in Ext.P1/R1(a) document is 'earth work and blanketing for formation on approaches, collection of ballast, linking of track and other protective works'. Therefore, it is evident that collection of ballast is a material part of the work. Furthermore, paragraph 12 of Ext.R1(b)-details and specifications of work, indicates as follows in bold letters:- **“12. Important Note:- The tenderer is required to submit the original test report of ballast as per provisions of “specification of track ballast IRS-GE-1,** WP(C) No.34126/2016 : 9 : ## **June 2016” Failing which the offer shall be summarily rejected.”** 11. Clause 13 of the guidelines to the tenderers makes it clear that all documents in support of fulfillment of eligibility criteria should be uploaded along with the tender and that the tenders without documentary evidence in support of eligibility criteria will be summarily rejected. 12. Clause 13 (b) of Ext.R1(b) provides that “The test reports of the ballast for the Abrasion value, Impact value and water absorption from the approved laboratory/institution are to be enclosed along with the tender as per provisions of Specification of track ballast IRS–GE–1–June 2016 corrected upto date, failing which the offer shall be summarily rejected. The said provision in Ext.R1(b) is a clear indication that submission/uploading of Ballast Test Certificate is mandatory. 13. Therefore, it is evident that the uploading of important documents including Ballast Test certificate is made mandatory in the tender conditions. Respondents 1 to WP(C) No.34126/2016 : 10 : 5 have produced Ext.R1(g) advertisement in respect of tender notice in question published in newspapers. It has been specified therein by the Chief Engineer (Construction) that if bidders require any further information or clarification, the Chief Administrative Officer should be consulted. In the said circumstances, the petitioner ought to have consulted the said officer, if the petitioner had any doubt regarding the requirement of submission/uploading of Ballast Test Certificate. 14. In the judgment in W.P.(C) No.21541/2019, this Court has held that a Tender Evaluation Committee is expected to decide on questions relating to qualification and eligibility of the contractors based on documents made available by them in terms of the invitation. The Committee is not expected to conduct enquiries as to whether the contractors are qualified and eligible, if documents made available by them do not disclose their qualification and eligibility. 15. There is no material to sustain the argument of the WP(C) No.34126/2016 : 11 : petitioner that in the nature and quantity of the work in question, uploading of Ballast Test Certificate was not required. Exts.R1(a) and R1(b) documents containing tender conditions would show that submission/uploading of Ballast Test Certificate was mandatory. 16. In the judgment in _**Air India Limited v. Cochin International Airport Ltd. and others [** (2000) 2 SCC 617],_ the Apex Court held that even when some defect is found in the decision making process, the Court must exercise its discretionary power under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The Court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to the conclusion that overwhelming public interest requires interference, the Court should intervene. 17. A person, who has made the highest bid or lowest bid as the case may be, does not acquire any right to have the auction concluded in his favour. In this case, the WP(C) No.34126/2016 : 12 : petitioner failed to produce a material document which was necessary to assess the eligibility of the petitioner for award of the work. A thorough reading of the tender conditions by the petitioner would have revealed to the petitioner the necessity of uploading Ballast Test Certificate. Having failed to do so, the petitioner cannot be heard to contend that rejection of its bid is arbitrary. 18. This Court also do not find any merit on the arguments raised by the petitioner on the basis of Ext.P4 order of the Central Vigilance Commission. Ext.P4 does not totally prohibits negotiations with tenderers. Ext.P4 provides that negotiations can be made in exceptional circumstances after due application of mind. The writ petition filed by the petitioner is therefore devoid of merit and it is accordingly dismissed. Sd/- **N. NAGARESH, JUDGE** aks/30.11.2020 WP(C) No.34126/2016 : 13 : ## **APPENDIX** ## **PETITIONER'S EXHIBITS:** **EXHIBIT P1 TRUE COPY OF THE RELEVANT PAGE OF THE TENDER DOCUMENT SUBMITTED BY THE PETITIONER.** **EXHIBIT P2 TRUE COPY OF THE DOCUMENT EVIDENCING THE QUOTING OF RATE BY PETITIONER AS WELL AS 6TH RESPONDENT.** **EXHIBIT P3 TRUE COPY OF THE TENDER DOCUMENT IN RESPECT OF THE SAID WORK.** **EXHIBIT P4** **TRUE COPY OF THE OFFICE ORDER NO. 68/10/2005 DATED 25/10/2005 OF THE CENTRAL VIGILANCE COMMISSION.** **EXHIBIT P5** **TRUE COPY OF CIRCULAR NO,4/3/07 DATED 03/03/2007 OF THE CENTRAL VIGILANCE COMMISSION.** - **EXHIBIT P6 TRUE COPY OF THE CIRCULAR NO.37/10/06 DATED 03/10/2006 OF THE DIRECTOR, CENTRAL VIGILANCE COMMISSION.** **EXHIBIT P7** - **TRUE COPY OF THE CIRCULAR NO.01/01/2010 DATED 20/01/2010 OF THE CHIEF TECHNICAL EXAMINER OF CENTRAL VIGILANCE COMMISSION.** ## **RESPONDENTS' EXHIBITS:** **EXHIBIT-R1(a) TRUE COPY OF THE E-TENDER APPLICATION NO.07-CE-CN-ERS-2019-OT DATED 14/10/2019.** **EXHIBIT-R1(b) TRUE PHOTOCOPY OF THE DETAILS AND SPECIFICATIONS OF WORK HAS UPLOADED IN THE E-TENDER.** WP(C) No.34126/2016 : 14 : - **EXHIBIT-R1(c)** - **TRUE PHOTOCOPY OF THE GUIDELINES FOR THE TENDER FOR CONSTRUCTION.** - **EXHIBIT-R1(d) TRUE PHOTOCOPY OF THE CHECK LIST FOR THE GUIDANCE OF TENDERERS FOR RAILWAY CONSTRUCTION.** **EXHIBIT-R1(e)** - **TRUE PHOTOCOPY OF THE RELEVANT PAGES TENDER QUALIFYING CONDITION.** **EXHIBIT-R1(f) TRUE COPY OF THE AFFIDAVIT SUBMITTED BY THE PETITIONER/TENDERER** - **EXHIBIT-R1(g)** - **TRUE PHOTOCOPY OF THE ADVERTISEMENT PUBLISHED IN A MALAYALAM DAILY, DATED 01.10.2019 (MALAYALA MANORAMA)** - **EXHIBIT-R1(h) TRUE PHOTOCOPY OF THE RELEVANT PAGE OF IREPS WEB PORTRAIT SHOWING NO QUERIES CLARIFICATIONS AVAILABLE FOR THIS TENDER.** - **EXHIBIT-R1(i) TRUE PHOTOCOPY OF THE JUDGMENT IN WPC 21541/2019 OF HIGH COURT OF KERALA ORDER DATED 3/10/2019.** - **EXHIBIT R1(J)** **EXHIBIT R6(a):** **TRUE PHOTOCOPY OF THE EXTRACT OF PARA 8.3 OF PART-B 'REGULATIONS FOR TENDERS AND CONTRACTS AND INSTRUCTIONS TO TENDERERS'. TRUE COPY OF CLAUSE 12 OF TENDER DOCUMENTS WITH IMPORTANT NOTE REQUIRING SUBMISSION OF TEST CERTIFICATE OF BALLAST.** **EXHIBIT R6(b):** **EXHIBIT R6(c):** **TRUE COPY OF TEST CERTIFICATE OF BALLAST PRODUCED BY THE 6TH RESPONDENT. TRUE COPY OF LETTER OF THE RAILWAY INVITING 6TH RESPONDENT FOR NEGOTIATION OF THE RATES QUOTED DOWNLOADED.** WP(C) No.34126/2016 : 15 : **EXHIBIT R1 K THE TRUE COPY OF RELEVANT EXTRACT REGARDING THE 'SUBMISSION OF TENDER' EXHIBIT R1 L THE TRUE COPY OF CERTIFICATE OF INCORPORATION PRODUCED BY THE PETITIONER**