Shri Harikrishna Industries v. Kerala State Electricity Board Limited and The Chief Engineer (Transmission South), Kerala State Electricity Board Limited

W.P.(C) No. 2926/2023 : 1: ## IN THE HIGH COURT OF KERALA AT ERNAKULAM ## PRESENT ## THE HONOURABLE MR. JUSTICE SHAJI P.CHALY TUESDAY, THE 28[TH] DAY OF FEBRUARY 2023 / 9TH PHALGUNA, 1944 ## WP(C) NO. 2926 OF 2023 ## PETITIONER/S: SHRI HARIKRISHNA INDUSTRIES PLOT 311, SIDCO WOMEN INDUSTRIAL PARK, KATTUR, CHENNAI - 600 062 REPRESENTED BY ITS PROPRIETRIX, SMT. M.K.RADHA, AGED 73 YEARS, W/O T.K.ANANTHARAMAN, RESIDING AT NO4, SB NAGAR, 1ST STREET, THIRUMULAIVOYAL, CHENNAI, PIN – 600 062. BY ADV SAJEEV KUMAR K.GOPAL ## RESPONDENT/S: - 1 THE KERALA STATE ELECTRICITY BOARD LIMITED VYDHYUTHI BHAVAN, PATTOM P.O, THIRUVANANTHAPURAM - 695 004, REPRESENTED BY ITS CHAIRMAN. - 2 THE CHIEF ENGINEER (TRANSMISSION SOUTH) KERALA STATE ELECTRICITY BOARD LIMITED, 3RD FLOOR, VYDHYUTHI BHAVAN, PATTOM P.O, THIRUVANANTHAPURAM, PIN – 695 004. BY ADV. SRI. NIRMAL S, SC THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 28.02.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) No. 2926/2023 : 2: ## **SHAJI P. CHALY, J.** --------------------------------------------------------W.P.(C). No. 2926 of 2023 --------------------------------------------------------Dated this the 28[RD] day of February, 2023. ## The petitioner, a contractor, has filed this writ petition seeking a declaration that the rejection of the tender submitted by it on the ground that it failed to upload the scanned copy of signed agreement along with cover No.1 is illegal and against the general principles acceptable to the evaluation of the tender documents; and for a writ of mandamus directing the respondents to accept the tender submitted by the petitioner pursuant to Exhibit P1 Notice Inviting Tender dated 19.12.2022 and to process the said tender in accordance with the tender conditions and finalise the same in accordance with law. 2. Brief material facts for the disposal of the writ petition are as follows: The Kerala State Electricity Board, respondent No.1, has invited a bid by issuing Exhibit P1 tender notification for the work of ‘upgradation of 19.74 K.M. Mavelikkara Thiruvalla 66 KV DC line to 11 KV under the transmission circle Alappuzha' with a Probable Amount of Contract (PAC) of Rs. 16,38,93,746/- with other terms and conditions. The petitioner, based on a joint venture agreement W.P.(C) No. 2926/2023 : 3: and being the lead member and the power of attorney for the joint venture, participated in the tender process. The method adopted in the tender is a ‘three cover system’. In Cover No.1, the EMD as well as the scanned copy of the signed agreement should be uploaded. However, according to the petitioner due to an inadvertent omission, the petitioner only uploaded the EMD along with the cover No.I. 3. The case of the petitioner is that the scanned signed copy of the agreement was uploaded mistakenly along with cover No.2 and hard copies of all the originals were submitted within the time permitted. Therefore, the sum and substance of the contention is that at the time of evaluation of the tender, as per clause 15 of Exhibit P5 Instructions to Bidders, all the documents are readily available. 4. The legal contention advanced by the petitioner is that the said clause never postulates that the absence of the scanned copy of the agreement in cover No.1 will result in rejection of the tender. However, the tender of the petitioner was rejected for the reason that the scanned copy of the agreement was not uploaded along with cover No.1. It is further pointed out that the rejection of the tender was not informed to the petitioner though uploaded on the site; and it is thus aggrieved, the writ petition is filed contending that the rejection of the tender for not uploading the agreement W.P.(C) No. 2926/2023 : 4: along with cover No.1 is absolutely illegal and arbitrary and against the conditions contained in the Notice Inviting Tender and the Instructions to Bidders. 5. According to the petitioner, the failure on the part of the petitioner in not uploading the signed agreement along with the EMD in cover No.1 is not a major irregularity to have met with the fate of rejection of tender. It is further pointed out that it is only a curable defect and therefore, the respondents went wrong in rejecting the tender. That apart, it is contented that all the bid documents in original were made available in the respective cover by the petitioner within the extended time granted by the respondents and therefore, there is no justification in rejecting the bid purely on technical grounds. 6. Contentions are also advanced by the petitioner relying upon clause 15 of Exhibit P5 Instructions to Bidders, and submitted that the entire action of the respondents is unsustainable in law requiring interference of this Court exercising the power of discretion conferred under Article 226 of the Constitution of India **.** 7. A detailed counter affidavit is filed by the respondents refuting the allegations and the claims and demands raised by the petitioner. It is submitted that the bid was invited from the open market with the terms and conditions contained in the Notice Inviting Tender and the general conditions issued to the bidders. W.P.(C) No. 2926/2023 : 5: According to the respondents, since the petitioner has not uploaded the agreement along with the EMD in cover No.1, the same is a violation of the essential conditions contained under the Notice Inviting Tender and the Instructions to Bidders. Various provisions of the Instructions to bidders contained in Exhibit P5 are relied upon by the respondents in order to justify the action of the rejection of the bid submitted by the petitioner. 8. I have heard the learned counsel for the petitioner Sri. Sajeev Kumar K. Gopal and the learned Standing Counsel for the Kerala State Electricity Board Sri. Nirmal S, and perused the pleadings and materials on record. 9. The learned counsel for the petitioner advanced arguments on the basis of the pleadings discussed above. The learned counsel has relied upon the judgment of the Apex Court in M _**/s. Poddar**_ _**Steel Corporation v. M/s. Ganesh Engineering Works and others**_ [1991 (3) SCC 273] and a Division Bench judgment of the Delhi High Court in _**Pes Installations Pvt. Ltd. And another v. Union of India and another**_ [2015 KHC 2781]. 10. On the other hand, the learned Standing Counsel has heavily relied upon clauses 14 and 15 of Exhibit P5 Instructions to bidders. They read thus: ## “14. **SUBMISSION OF BIDS** ## 14.1 Online Submission of Bids W.P.(C) No. 2926/2023 : 6: 14.1.1 Bidders shall submit online the bid documents and questionnaire duly filled in giving all desired information therein. 14.1.2. Bids shall be submitted in the following designated online covers: ## A **Cover No.1- Bld Agreement & EMD** The cover marked as 'Cover Number 1, contains: () EMD Particulars uploaded by bidder Auto filled by the System and (i) Scanned copy of signed Tender agreement as per sample form 'A' of section 3 of Part-1 of Pre-qualification bid attached in Kerala Stamp Paper worth Rs 500/-) to be uploaded by bidder. ## (B) **Cover No. 2/Pre- Qualifcation documents)** The cover marked as 'Cover Number-2' contains: (i) Pre-Qualification Bid, Part-I (pdf document to be filled and uploaded) (ii) Pre-Qualification Bid, Part-ll ( Technical Specifications) (iii) Supporting Documents to prove the financial capabilities, experience and qualification mentioned in Part-I bid questionnaire ( as a single pdf document) (iv) Joint Venture Agreement (If Applicable), Power of attorney/ extract of resolution of Board of director's of the firm, the case may be, for signing the bid document (if Applicable), (v) Power of attorney for Joint Venture (If Applicable) as per sample form ‘I’ of section 3 of Part. I of Pr-qualification bid attached in Kerala Stamp Paper worth Rs 600/- (vi) Application for pre-qualification, Formats and Questionnaires as per the pre-qualification document for Technical Experience and Financial Capability duly filled in by the applicant. (vii) All other scanned certificates/documents mentioned elsewhere in the bid documents for Per-Qualification. (Upload as a single pdf document) ## (C) **Cover No.3LPrice Bid)** W.P.(C) No. 2926/2023 : 7: The cover marked as 'Cover Number- 3 contains: ## (i) B0Q-xls document (i) Scanned copy of Bid form (Part-1, Sample Form H) in Kerala stamp paper worth Rs 500/-are to be filled and a scanned copy to be uploaded along with the Price Bid. ## 14.1.3. Instructions for on- line submission a. Pre-Qualification Bid pdf documents (in Cover 2) are to be first downloaded from the site and to be uploaded back after furnishing with the required information. b.The Bidder shall complete the Price bid as per format given for download along with this tender. c. Every page of documents, including formats etc. provided as annexure are to be invariably signed by the bidder before uploaded. d. The blank Price Bid should be downloaded and saved on bidder's computer without changing file-name otherwise price bid will not get uploaded. The bidder should fill in the details in the same file and upload the same back to the website. e. KSEB Ltd doesn't take any responsibility for any technical snag or failure that has taken place during document upload. 14.2 Submission of Hard Prints of Bid documents in original 14.2.1. Hard copies of the following signed documents in original should be submitted to the Chief Engineer (Transmission South) in sealed and separate covers clearly superscribing the contents including the Bid number as mentioned below, in order to reach the office of Chief Engineer (Transmission South)on or before bid opening date and time ie; 16-1-2023, 11 AM (i) Cover No.1- "Bid agreements" containing: (a) Original of Signed Tender Agreement. (as per sample form 'A' of W.P.(C) No. 2926/2023 : 8: section 3 of Part-1 of Pre- qualification bid attached in Kerala Stamp Paper worth Rs 500/-), (b)Joint Venture Agreement (1f Applicable), Power of attorney (If Applicable /required)- in Stamp Paper worth Rs 600/ extract of resolution of Board of directors of the firm, the case may be, for signing the bid document (if Applicable) c). Signed Bid form in Original (as per sample form 'H' of section 3 of Part-1 of Pre-qualification bid attached in Kerala Stamp Paper worth Rs. 500. 14.2.3. Failure in submission of Cover No.1 as above in original will lead to the rejection of the tender. 14.2.4, Price should not be mentioned in any other documents or anywhere else other than in online BOQ. 14.2.5. Also, the bidder shall submit the original of any of the documents uploaded in the bid, if so required at any stage of evaluation and award process. 14.2.6. If any discrepancy is noticed in the tender submitted by the bidder through online and the hard copy, the tender will be summarily rejected. 14.2.7. The envelope containing the above should reach the tender inviting authority on or before the PQ bid opening date &time, failing which the bid is liable to be rejected. KSEBL shall not be responsible for any kind of postal/courier service delay or any other delay. 14.2.8. All bids received without the scanned copies of documents mentioned above will be summarily rejected. ## **15. BID OPENING AND EVALUATION** 15.1. Online opening of Bids 15.1.1.Cover-1 will be opened and the EMD details will be examined first. Any variations in the EMD amount as stipulated that from Clause 11.1 above will make a bidder not eligible to be considered for opening either their Pre-qualification bid or price bid. W.P.(C) No. 2926/2023 : 9: 15.1.2. Correctness of the scanned copies of Agreement, Bid form, Power of attorney (required), Joint Venture Agreement (if Applicable), as per sample Form of section 3 of Part 1 of Pre-qualification bid shall be then examined. Absence of the same shall be reason for rejection of the bid. 15.1.3. Cover-ii corresponding to all the bidders who have satisfied the authority with regard to the content of Cover 1, will then be opened. Qualified bidders will be selected after scrutiny of the pre-qualification bids. The selection so made shall be final and no appeal shall lie against it. 15.1.4. KSEB Ltd reserves the right to disqualify any bidder without assigning any reason whatsoever. 15.1.5. Price Bids in Cover-iii of the qualified bidders as 15.1.3 above alone will be opened and considered. 15.1.6. The time and date of opening of the price bids of the selected bidders will be intimated to qualified bidders and they will be allowed to witness opening of price bids, if they so desire, on production of valid proof of authorization. 15.1.7. If any date mentioned in the document happens to be a holiday for KSEB Ltd. Thiruvananthapuram, the next working day is to be considered instead.” 11. Relying upon the said provisions, it is submitted that since the petitioner failed to upload the agreement along with the EMD in cover No.1, cover No.2 submitted by the petitioner cannot be opened by virtue of the imperative provisions of clause 15 of Exhibit P5 Instructions to Bidders. I have analysed the respective submissions made across the Bar. I find force in the arguments advanced by the Board, since the opening of the covers successively depends on the compliance of the requirements of each of the covers by the participating bidders. W.P.(C) No. 2926/2023 : 10: 12. It is an admitted fact that the petitioner did not upload the signed agreement as required under clause 15.1 along with the EMD in cover No.1. In that view of the matter, it can be seen that cover Nos.2 and 3 submitted by the petitioner cannot be opened. This is an essential condition of contract in a competitive bid. To put it otherwise, if the petitioner’s bid is accepted and finally awarded in favour of the petitioner, is it not a ground for other participants to challenge the award of the tender to the petitioner, since the petitioner has not complied with the requirements contained under clause 15.1.1 of Exhibit P5 Instructions to Bidders. 13. In my considered opinion, the logical conclusion is that the petitioner having failed to upload the agreement along with the EMD in cover No.1, it is disqualified from being considered for the opening of cover Nos.2 and 3. Therefore, the contention advanced by the petitioner that in cover No.2, the agreement was incorporated by the petitioner cannot be sustained under law, basically for the reason that cover No.2 will not be opened, since the petitioner failed to satisfy the requirements of cover No.1. The compliance of conditions of cover No 1 is indispensable for the basic reason that without a signed agreement, the tender could not have proceeded any further. 14. That apart, the cover No2 submitted by the petitioner will not be opened as per the requirement of clauses 15.2 and 15.3, and W.P.(C) No. 2926/2023 : 11: due to which the contention of the petitioner that the signed agreement is included in cover No2 cannot be deciphered at all. Even though the petitioner has relied upon the afore-quoted judgments, to buttress his submissions, I am of the view that the facts and circumstances therein are not similar to the facts of this case so as to apply the proposition of the law laid down. 15. The upshot of the above discussion is that the petitioner has failed to make out a case of arbitrariness or illegality on the part of the respondents in rejecting the tender, since the petitioner has not satisfied the requirements of cover No.1 which is an essential condition to have simply overlooked. Writ petition fails and accordingly, it is dismissed. sd/- **SHAJI P. CHALY, JUDGE.** Rv W.P.(C) No. 2926/2023 : 12: ## APPENDIX OF WP(C) 2926/2023 ## PETITIONER’S EXHIBITS: Exhibit P1 TRUE COPY OF THE NOTICE INVITING E-TENDER DATED 19-12-2022 VIDE BID NO.C(TS)/EE1/AE2/07/MAVELIKKARA – THIRUVALLA/2022-23. Exhibit P2 TRUE COPY OF THE JOINT VENTURE AGREEMENT DATED 14-01-2023 ENTERED BETWEEN THE PETITIONER AND SRI. A.M. PREM BHUSAN Exhibit P3 TRUE COPY OF THE POWER OF ATTORNEY FOR JOINT VENTURE DATED 16-01-2023 Exhibit P4 TRUE COPY OF THE RELEVANT PAGES OF PREQUALIFICATION BID PART-I GENERAL TENDER TERMS AND CONDITIONS FOR E-TENDERS PUBLISHED BY THE 2ND RESPONDENT DATED 19-12-2022. Exhibit P5 TRUE COPY OF THE RELEVANT OF PAGES OF INSTRUCTIONS TO THE BIDDERS CONTAINING CLAUSE NO.14 & 15 DEALING WITH SUBMISSION OF BIDS. Exhibit P6 TRUE COPY OF THE BID FORM SUBMITTED BY THE PETITIONER DATED 14-01-2023 Exhibit P7 TRUE COPY OF THE TENDER AGREEMENT DATED 1401-2023. ## RESPONDENTS’ EXHIBITS: NIL True Copy rv PS To Judge.