At, High Court of Kerala
By, THE HONOURABLE MR. JUSTICE N. NAGARESH
For the Petitioner: M. Jithesh Menon, K. Indu (Pournami), R. Brijesh, P.G. Maheshkumar, Advocates. For the Respondents: R1, S.P. Aravindakshan Pillay, R2, A.C. Devy, Advocates.
1. The petitioner a company running security services is before this Court seeking to direct the 1st respondent to allot work of supply of security personnel to the petitioner for the year 2019-2020, in view of the fact that petitioner is the lowest bidder.2. The petitioner states that the 1st respondent invited tenders for supply of security personnel for the year 2019-2020. The petitioner was the successful bidder and he was awarded the work of supplying the security personnel to the University for the year 2019- 2020. Ext.P2 agreement was entered into. The period of Ext.P2 agreement expired on 30.01.2020.3. As Ext.P2 was expiring, the 1st respondent invited fresh tenders for the work, the petitioner submitted his bid. However, due to the outbreak of Covid-19 pandemic, the said tender proceedings could not be finalised. The petitioner was granted extension of contract in the meanwhile.4. On 13.07.2020, the 1st respondent issued Ext.P4 notification inviting bids for the work. Ext.P4 contained technical specifications and other requirements. Ext.P4 specifically required that the rates for service should be quoted "rate per head for 8 hours duty per day (not inclusive of GST)" and it was made clear that otherwise the tender/quotation will be summarily rejected. Ext.P4 further stated that the agencies submitting the quotation should have own approved training centres to train the guards or should have Memorandum Of Understanding signed with approved training centres based at Kerala. The technical specifications further required that the agency should have a minimum of 10 years experience in the field and that preference will be given to the companies have full operation in Kerala with Head Quarters at Ernakulam. Ext.P4 further stipulated that agencies should provide minimum wages to the guards as per The Minimum Wages Act.5. The petitioner contended that among the five agencies who bid pursuant to Ext.P4, only 2 agencies including the petitioner quoted the rates as required in the technical specifications. Three of the bidders did not quote 'the rate per head for 8 hours duty per day' as required under Ext.P4. Among the agencies who quoted properly, the petitioner was the lowest bidder.6. The petitioner understood that the contract was going to be awarded to the 2nd respondent. The petitioner was served with Ext.P11 letter of the 1 st respondent, requiring the petitioner to continue his service only till 14.11.2020.7. The learned counsel for the petitioner submitted that the award of work proposed to be made in favour of the 2nd respondent, is absolutely illegal and highly arbitrary. The proposed award in favour of the 2 nd respondent is against the conditions contained in Ext.P4. In the circumstances unless this Hon'ble Court interferes in the matter, the petitioner will be put to irrecoverable loss.8. The 1st respondent filed a counter affidavit and defended the writ petition. The 1 st respondent stated that though there was a condition in the notification that the rate per head for 8 hours duty per day (not inclusive of GST) shall be quoted, only the petitioner and another agency quoted the rates in that manner. Other bidders quoted the rates on monthly/yearly basis. The five agencies short listed by the technical evaluation committee quoted rates adopting different yardstick. Therefore the financial evaluation committee decided to seek clarifications from those agencies in order to have a reasonable comparison of rates.9. Clarifications from those agencies were obtained. On the basis of the said information, the rate per head for 8 hours duty per day quoted was tabulated. Thereupon it was found that the rate quoted by the 2 nd respondent was the lowest. The financial evaluation committee recommended to award the work to the 2 nd respondent.10. The Standing Counsel for the 1st respondent submitted that a comparative assessment of the rates quoted by the 2nd respondent and the petitioner shows that the rate quoted by the 2 nd respondent is much less than the rate quoted by the petitioner. There is a difference of Rs.6 Lakhs per annum between the rates quoted.11. Heard the learned counsel for the petitioner and learned Standing Counsel appearing for the 1 st respondent and the counsel appearing for the 2 nd respondent.12. The prime grievance of the petitioner is that quoting 'the rate per head for 8 hours duty per day (not inclusive of GST)' was a mandatory condition as per Ext.P4. Ext.P4 provided that if rate per head for 8 hours duty per day is not quoted, quotation will be summarily rejected. It has to be noted that on opening the bid the 1st respondent found that majority among the short listed bidders did not quote the rate per head for 8 hours duty per day. It is in such circumstances, the 1 st respondent decide to obtain explanation regarding the rates quoted by them.13. The opportunity was not given to the 2 nd respondent alone. On receipt of the requisite information, the 1st respondent found that the rates quoted by the 2 nd respondent is Rs.646.64/- and Rs.757.56/- for guard and supervisor and the rates quoted by the petitioner is Rs.662.57/- and Rs.789.7268/- respectively. The rate quoted by the 2nd respondent was much advantageous to the 1st respondent and if the said bid is accepted, the 1 st respondent will be saving an amount of Rs.6 Lakhs per annum.14. The opportunity given by the 1 st respondent to explain the rates quoted by the bidders has not legally prejudiced the petitioner. The petitioner has no case that the 2nd respondent or any other bidder who were given such opportunity, have reduced the amount originally quoted by them, to the prejudice of the petitioner.15. The further contention of the petitioner is that the technical specification made mention in Ext.P4 requires that the agencies providing security personals should own approved training centers to train the guards or should have Memorandum of Understanding signed with approved training centers based at kerala. The technical specifications also stipulated that companies having full-fledged operational based in Kerala with Head Quarter at Ernakulam will be preferred.16. In this regard the 1st respondent pointed out that the 2nd respondent has signed a Memorandum of Understanding with M/s. Sparta Training Centre for providing training of its personnel. The 2 nd respondent has branch office at Palarivattom and its operations are controlled by the Palarivattom branch office. The 1 st respondent found that the training facility under M/s. Sparta Training centre is sufficient enough. The technical specifications given in Ext.P4 does not state that exclusive preference will be given to companies having full-fledged operational base in Kerala with Head quarters at Ernakulam. The question of granting preference comes only when the merit of the bids are equal in other respects. In this case the bid amount of the 2 nd respondent was found far less than that of the petitioner.17. The Hon'ble Apex Court in Maa Binda Express Carrier and Anr v. Northeast Frontier Railway [2014 3 SCC 760] has held that bidders participating in the tender process cannot insist that their bid/tenders should be accepted simply because a bid is the highest or lowest. The Hon'ble Apex Court further held that the scope of judicial review in matters relating to award of contract by the State and its instrumentalities is limited. Award of contract is essentially a commercial transaction, which must be determined on the basis of consideration of data relevant to such commercial decision.18. The Hon'ble Apex Court again held in Jagdish Mandal v. State of Orissa and others [2007 14 SCC 517] that judicial review of
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administrative action is intended to prevent arbitrariness, irrationality, unreasonableness, bias and malafides. Its purpose is to check whether choice or decision is made "Lawfully" and not to check whether choice or decision is "Sound". Principles of Equity and Natural Justice stay at a distance in commercial transaction.Considering the circumstances under which the 2nd respondent was selected by the 1st respondent and considering the law laid down by the Hon'ble Apex Court in the afore judgment, this Court is of the considered opinion that the action of the 1st respondent in awarding the work to the 2nd respondent is in the interest of the 1st respondent-University and is amply justified. This Court therefore finds no reason to interfere with the award of tender to the 2nd respondent. The writ petition fails and accordingly it is dismissed.