ORDER

The petitioner before this Court, M/s. Indian Compressors Ltd., a Company registered under the Companies Act, 1956 has filed this present writ petition being aggrieved by the action of the respondents in disqualifying the petitioner in respect of the tender issued by the respondents ie., Tender No. 33227 for supply, installation and commissioning of skid mounted, oil lubricated helium gas recovery compressor with essential spares. The last date for submission of tender was 27/12/2018 and the petitioner has submitted his Techno Commercial and Price Bid on 22/12/2018. The petitioner, as stated in the Writ Petition, has also forwarded a scanned copy of the price breakup included in the price bid, as required under Clause 21.2.1 of the tender conditions. It has been further stated that the petitioner has received acknowledgement on 27/12/2018 informing him that his bid has been received. The petitioner’s further contention is that as per Clause 6.2 of the tender conditions, the price bid was to be opened at the second stage only after completion of evaluation of Part I (Techno Commercial Bid) of the tender. The petitioner has stated that the petitioner Company was shocked to receive a communication via e-mail on 6/3/2019 disqualifying the petitioner even before opening of the price bid on the ground that the petitioner has deviated from the conditions under the price bid head. The petitioner has raised various grounds before this Court and has placed heavy reliance upon the purchase manual issued by the Directorate of Purchase and Stores, Department of Atomic Energy and his contention is that the bid submitted by him was in consonance with the aforesaid manual. The contention of the petitioner is that the action of the respondents in disqualifying the petitioner is arbitrary and is also violative of Article 14 of the of the Constitution of India, hence, rejection of the petitioner’s bid is bad in law. It has been further stated that the order passed by the respondents in disqualifying the petitioner is wholly illegal, the petitioner has not committed breach of any of the terms and conditions of the NIT. The petitioner has prayed for quashment of the communication dated 6/3/2019 issued by the respondents.

02. A detailed and exhaustive reply has been filed in the matter and the respondents have stated that the petitioner did participate in the tender process, however, as the petitioner has deviated from the tender conditions and, therefore, the petitioner has been declared as disqualified. The respondents have stated that the contract was in respect of supply, installation, commissioning of skid mounted oil lubricated helium gas recovery compressor with essential spares and as per Part I ie., techno commercial bid, the bid was opened on 31/12/2018. It has been stated that the terms and conditions at Clause 45.1 of e-DPS-0-103 version 2018-2, categorically provided that in case the bidder does not accept the terms and conditions stipulated in the NIT, their bid will be outrightly rejected. The respondents have stated that the price bid template attached to NIT contained the following instructions as header notes :

(a) The GST as applicable on basic price shall be admitted by the purchaser and bidders shall not indicate / include rate of GST anywhere in the price bid;

(b) Whenever “O” is indicated, the column is blocked by purchasers. Unless specifically called for, documents related to cost / price of blocked columns should not be attached by the bidder, failing which the bid shall be summarily rejected.

(c) Offers will be summarily rejected, if price bid template and check-list template are not filled properly. Bids indicating price, GST etc., in irrelevant places will be summarily rejected.

(d) The nature of price to be indicated by the bidder shall be :

(i) For bids in INR; Safe delivery upto consignee.

(ii) For bids in foreign currency;

(a) Shipment by sea – FOB port of shipment

(b) Shipment by Air – FCA at the specified gateway airport.

03. It has been further stated that as per the NIT conditions, the payment terms indicated was 80% of the contract value exclusive of installation and commissioning shall be released by the purchaser after delivery of all consignments and inspection by purchaser’s inspector and balance payment will be made after final inspection, testing and acceptance and on submission of acceptance of PBBG.

04. It has been further stated that on examination of bid submitted by the petitioner it was found that the offer was not complying with the tender conditions, as in techno commercial part, in the additional attachment the bidder had indicated that the GST applicable will be 18% and price basis is ex-works. The bidder has also indicated 30% payment in advance along with the order and balance 70% payment before despatch. It has been stated by the respondents that GST 5% is applicable for the product when purchase by DPS for RRCAT. The respondents have further submitted that in view of the aforesaid deviations to the NIT terms; a mail communication dated 6/3/2019 was issued to the petitioner conveying rejection of their bid and, therefore, the rejection of the bid was fair and reasonable and the decision cannot be treated as arbitrary.

05. The stand of the respondents is that the petitioner’s bid was not in consonance with the terms and conditions of the tender document and as per the terms of the tender, after evaluation of part I techno commercial bid, the part II ie., price bid is opened. The respondents have stated that the petitioner has quoted GST @ 18% in their attachment of techno-commercial bid which is contrary to the NIT. The applicable GST is @ 5% and the price bid clearly mentions that where ever “0” Zero is indicated in the price bid, the column is blocked by the purchaser. The contention of the respondent is that the petitioner in fact, committed a mistake while submitting the tender. The respondents have categorically stated that the petitioner has admitted the mistake committed by the petitioner Company while sending an e-mail dated 18/3/2019. The e-mail sent by the petitioner reads as under :

Dear Sir,

With reference to your below mail dated 6/3/2019, we would like to submit as under :

1. In the “price bid format’ of the tender, we have indicated 0% both in the GST as well as in Freight Charges columns. This is in accordance with the tender conditions.

2. However in “Part I – Techno Commercial Bid’ uploaded by us in the tender bid, due to an oversight, we had mentioned the prevailing GST rate of 18% and price basis was mentioned as ‘Ex-works. However, there is no value mentioned that would have violated the tender bid norms. This is error which is worthy of being condoned.

We would be obliged if you could kindly take into consideration only the price break up indicated in the price bid format and keep us in the reckoning.

We look forward to your continued support.

Regards,

Anil Rawat,

Indian Compressors Limited

06. The stand of the respondents that it was the petitioner who was at fault in the matter and the question of interference by this Court, as the petitioner has been disqualified on account of his own lapse / omission / act, does not arise.

07. Heard learned counsel for the parties at length and perused the record.

08. Facts of the case reveal that the tender which was subject matter of the Writ Petition was issued ie., Tender No. 33227, for supply, installation and commissioning of skid mounted, oil lubricated helium gas recovery compressor with essential spares. The last date for submission of tender was 27/12/2018 and the petitioner has submitted his Techno Commercial and Price Bid on 22/12/2018. The respondents have stated that the contract was in respect of supply, installation, commissioning of skid mounted oil lubricated helium gas recovery compressor with essential spares and as per Part I ie., techno commercial bid, the bid was opened on 31/12/2018. It has been stated that the terms and conditions mentioned at Clause 45.1 of eDPS-0-103 version 2018-2, provides “in case the bidder does not accept the terms and conditions stipulated in the NIT, their bid will be outrightly rejected”. It has been stated that the price bid template attached to NIT contained the following instructions as header notes :

(a) The GST as applicable on basic price shall be admitted by the purchaser and bidders shall not indicate / include rate of GST anywhere in the price bid;

(b) Whenever “O” is indicated, the column is blocked by purchasers. Unless specifically called for, documents related to cost / price of blocked columns should not be attached by the bidder, failing which the bid shall be summarily rejected.

(c) Offers will be summarily rejected, if price bid template and check-list template are not filled properly. Bids indicating price, GST etc., in irrelevant places will be summarily rejected.

(d) The nature of price to be indicated by the bidder shall be :

(i) For bids in INR; Safe delivery upto consignee.

(ii) For bids in foreign currency;

(a) Shipment by sea – FOB port of shipment

(b) Shipment by Air – FCA at the specified gateway airport.

09. It has been further stated that as per the NIT conditions, the payment terms indicated that 80% of the contract value exclusive of installation and commissioning shall be released by the purchaser after delivery of all consignments and inspection by purchaser’s inspector and balance payment shall be made after final inspection, testing and acceptance and on submission of acceptance of PBBG.

10. It has been further stated that on examination of bid submitted by the petitioner it was found that the offer was not complying with the tender conditions, as in techno commercial part, in the additional attachment, the bidder had indicated that the GST application will be 18% and price basis is ex-works. The bidder has also indicated 30% payment in advance along with the order and balance 70% payment before despatch. It is pertinent to note that GST 5% is applicable for the product when purchased by DPS for RRCAT. It is pertinent to note that in view of the aforesaid deviations to the NIT terms; a mail communication dated 6/3/2019 was issued to the petitioner conveying rejection of their bid, which was done strictly in conformity with the NIT terms and conditions and, therefore, the rejection of the bid was fair and reasonable and the decision cannot be treated as arbitrary.

11. The petitioner himself has admitted his mistake while sending the e-mail communication to the answering respondents stating that the price quoted was inadvertently indicated as FOB instead of ex-works. The GST @ 18% indicated by the petitioner in their attachment to the techno commercial bid, is contrary to the terms and conditions of the NIT and as the petitioner has deviated from the terms and conditions of the NIT, the respondents have rightly disqualified the petitioner.

12. The following are the details of the tender conditions and deviations / violations made by the petitioner :

S.No.	Tender Conditions	Deviations / Violations
1	Sr.No.1 of price bid template: GST as applicable on basic price shall be admitted by the purchaser and bidders shall not indicate / include rate of GST anywhere in the price bid	GST applicable is 18% indicated in their offer.
2	Sr.No.3 of the price bid template nature of price shall be : i) for bids in INR: Safe delivery upto the consignee ii) for bids in Foreign Currency a) shipment by sea: FOB port of shipment b) Shipment by air: FCA at the specified gateway airport	Price terms mentioned in their offer as Ex-Works.
3	Sr.No.6 of price bid template Offers will be summarily rejected, if price bid template and checklist template are not filed properly. Bids indicating price, GST, etc., in irrelevant places will be summarily rejected.	They have deviated by indicating 1 and 2 above
4	Revised template e-DPS-P-103 version 2018-2 uploaded to the subject tender on 21/12/2018 which is in advance of due date ie., 31/12/2018	They have referred old version while uploading their offer.

13. In the light of the aforesaid deviations, the respondents have rightly rejected the petitioners tender. The scope of interference in the tender matters is quite limited.

14. The apex Court has time and again dealt with the issue of interference in the matter of award of contract. The apex Court in the case of Manohar Lal Sharma Vs. Narendra Damodardas Modi (Writ Petition (Criminal) No.225 of 2018, decided on December 14, 2018) in paragraphs No.7 and 8 has held as under:-

“7. Parameters of judicial review of administrative decisions with regard to award of tenders and contracts has really developed from the increased participation of the State in commercial and economic activity. In Jagdish Mandal vs. State of Orissa and Ors. 1 this Court, conscious of the limitations in commercial transactions, confined its scrutiny to the decision making process and on the parameters of unreasonableness and mala fides. In fact, the Court held that it was not to exercise the power of judicial review even if a procedural error is committed to the prejudice of the tenderer since private interests cannot be protected while exercising such judicial review. The award of contract, being essentially a commercial transaction, has to be determined on the basis of considerations that are relevant to such commercial decisions, and this implies that terms subject to which tenders are invited are not open to judicial scrutiny unless it is found that the same have been tailor-made to benefit any particular tenderer or a class of tenderers. [See Maa Binda Express Carrier & Anr. Vs. North East Frontier Railway & Ors .2]

8. Various Judicial pronouncements commencing from Tata Cellular vs. Union of India 3, all emphasise the aspect that scrutiny should be limited to the Wednesbury Principle of Reasonableness and absence of mala fides or favouritism.”

15. The apex Court has held that it is well settled preposition that matters pertaining to the award of contract, being essentially a commercial transaction, have to be determined on the basis of considerations that are relevant to such commercial decisions, and this implies that terms subject to which tenders are invited are not open to judicial scrutiny unless it is found that the same have been tailormade to benefit any particular tenderer or a class of tenderers.

16. The apex Court in the case of Air India Ltd. Vs. Cochin International Airport Ltd. reported in (2000) 2 SCC 617 in paragraph No.7 has held as under:-

“7. The award of a contract, whether it is by a private party or by a public body or the State, is essentially a commercial transaction. In arriving at a commercial decision considerations which are of paramount are commercial considerations. The State can choose its own method to arrive at a decision. It can fix its own terms of invitation to tender and that is not open to judicial scrutiny. It can enter into negotiations before finally deciding to accept one of the offers made to it. Price need not always be the sole criterion for awarding a contract. It is free to grant any relaxation, for bona fide reasons, if the tender conditions permit such a relaxation. It may not accept the offer even though it happens to be the highest or the lowest. But the State, its corporations, instrumentalities and agencies are bound to adhere to the norms, standards and procedures laid down by them and cannot depart from them arbitrarily. Though that decision is not amenable to judicial review, the Court can examine the decision making process and interfere if it is found vitiated by mala fides, unreasonableness and arbitrariness. The State, its corporations, instrumentalities and agencies have the public duty to be fair to all concerned. 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 a conclusion that overwhelming public interest requires interference, the Court should intervene.”

17. The apex court in the aforesaid case has observed that decision taken by the authorities is not amenable to the judicial review and the same can be interfered if it is found vitiated by mala fides, unreasonableness and arbitrariness.

18. The apex Court in the case of Tata Cellular Vs. Union of India reported in (1994) 6 SCC 651 has again dealt with the issue of interference in respect of contractual matter.

Paragraph No.94 of the aforesaid judgment reads as under:

“94. The principles deducible from the above are :

(1) The modern trend points to judicial restraint in administrative action.

(2) The court does not sit as a court of appeal but merely reviews the manner in which the decision was made.

(3) The court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible.

(4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts.

(5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principle of reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides.

(6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure.

Based on these principles we will examine the facts of this case since they commend to us as the correct principles.”

19. In the case of Jagdish Mandal Vs. State of Orissa and Others reported in (2007) 14 SCC 517 again scope of judicial review has been looked into. It has been held by the apex Court that power of the power of judicial review cannot be invoked to protect private interest at the cost of public interest, or to decide contractual disputes, and such interference, either interim or final, may hold up public work for years, or delay relief and succour to thousands and millions and may increase the project cost manifold. The Court before interfering in tender or contractual matters in exercise of power of judicial review, should restrict its inquiry to whether the process adopted or decision made by the authority is mala fide or intended to favour someone; or whether the process adopted or decision made is so arbitrary and irrational that no responsible authority acting reasonably and in accordance with relevant law could have taken it; and whether public interest is affected. If the answers are in the negative, there should be no interference under Article 226.

20. A similar view has been taken by the apex Court in the case of Central Coalfields Ltd. Vs. SLL-SML Joint Venture Consortium and Others reported in (2016) 8 SCC 622. Paragraph No.43 of the aforesaid judgment reads as under:-

“43. Continuing in the vein of accepting the inherent authority of an employer to deviate from the terms and conditions of an NIT, and reintroducing the privilege-of-participation principle and the level playing field concept, this Court laid emphasis on the decision-making process, particularly in respect of a commercial contract. One of the more significant cases on the subject is the three-Judge decision in Tata Cellular v. Union Of India. Tata Cellular v. Union Of India., 1994 6 SCC 651 which gave importance to the lawfulness of a decision and not its soundness. If an administrative decision, such as a deviation in the terms of NIT is not arbitrary, irrational, unreasonable, mala fide or biased, the courts will not judicially review the decision taken. Similarly, the courts will not countenance interference with the decision at the behest of an unsuccessful bidder in respect of a technical or procedural violation. This was quite clearly stated by this Court (following Tata Cellular) in Jagdish Mandal v. State of Orissa Jagdish Mandal v. State of Orissa, 2007 14 SCC 517 in the following words: (SCC p. 531, para 22)

“22. Judicial review of administrative action is intended to prevent arbitrariness, irrationality, unreasonableness, bias and mala fides. Its purpose is to check whether choice or decision is made “lawfully” and not to check whether choice or decision is “sound”. When the power of judicial review is invoked in matters relating to tenders or award of contracts, certain special features should be borne in mind. A contract is a commercial transaction. Evaluating tenders and awarding contracts are essentially commercial functions. Principles of equity and natural justice stay at a distance. If the decision relating to award of contract is bona fide and is in public interest, courts will not, in exercise of power of judicial review, interfere even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. The power of judicial review will not be permitted to be invoked to protect private interest at the cost of public interest, or to decide contractual disputes. The tenderer or contractor with a grievance can always seek damages in a civil court. Attempts by unsuccessful tenderers with imaginary grievances, wounded pride and business rivalry, to make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade courts to interfere by exercising power of judicial review, should be resisted. Such interferences, either interim or final, may hold up public works for years, or delay relief and succour to thousands and millions and may increase the project cost manifold.”

This Court then laid down the questions that ought to be asked in such a situation. It was said: (Jagdish Mandal case, SCC p. 531, para 22)

“22. … Therefore, a court before interfering in tender or contractual matters in exercise of power of judicial review, should pose to itself the following questions:

(i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone; or

Whether the process adopted or decision made is so arbitrary and irrational that the court can say:

“the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached”;

(ii) Whether public interest is affected.

If the answers are in the negative, there should be no interference under Article 226.”

21. In light of the aforesaid case, the question of interference by this Court does not arise. Accordingly, the present Writ Petition is dismissed. No order as to costs.