If the decision relating to the award of the contract is bona fide and is in public interest, courts will not exercise power of judicial review: Orissa High Court
Even if a procedural aberration, error in assessment, or prejudice to a tenderer is established, courts will not intervene in the exercise of judicial review if the decision pertaining to contract award is bona fide and in the public interest. The authority of judicial review will not be used to defend private interests at the expense of the public good or to resolve contract disputes. The judgment was passed by The High Court of Orissa in the case of M/s.I.V.T.V.L.T.(J.V.) V. Chairman-cum-Managing Director, MCL and others [WP(C) No.4500 OF 2021] by Single Bench consisting of Hon’ble Shri Justice. B.P. Routray. The Petitioner is a joint venture company, participated in the bidding process invited by Opposite Party i.e., Mahanadi Coal Fields Limited by Notice Inviting Tender for the work. The technical bid was opened, where four bidders including the Petitioner and Opposite Party qualified. Petitioner objected to the technical qualification of Opposite Party and submitted representation to Opposite Party stating that the work experience certificate submitted by Opposite Party is not genuine and ought not to have been accepted. The contention of the Petitioner that as per Clause-8(A) of the NIT, the work experience certificate has been defined to the effect that the bidder must have experience of work of similar nature valuing 50% of the annualised estimated value of the work put to tender. As per calculation, 50% of the annualised value of the estimated cost comes to Rs.4,18,31,738. The work experience certificate of Opposite Party filed of Rs.6,00,72,502, is not matching with the work order submitted by Opposite Party which has been annexed under Annexure-3 series. Therefore, the work experience certificate of Opposite Party is not a genuine document. Opposite counsel refuted the case of the Petitioner by saying that Petitioner has not presented the correct facts in the writ petition. It is their case that Petitioner has submitted three work experience certificates to reveal his qualification in terms of Clause-8(A) of the NIT. The first certificate has been issued by M/s.Shyam Metalics and Energy Limited showing work done experience by the parties to the tune of Rs.6,00,72,502, and two other work experience certificates showing value of Rs.2,73,91,960/- and Rs.1,51,56,032/- respectively by M/s.Godavari Commodities Limited. While relying on the Supreme Court in the case of Jagdish Mandal v. State of Orissa, the court held that “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.”
 IN THE HIGH COURT OF ORISSA AT CUTTACK WRIT PETITIONNo.4500 OF 2021 An application under Articles 226 & 227 of the Constitution of India.) Petitioner Versus Chairman cum Managing Director MCL and others Advocate(s) appeared in this case: ….… Opposite Parties For Petitioner For Opposite Parties Mr. Sidheswar Mohanty Advocate Mr. Debaraj Mohanty Advocate For Opposite Party Nos.1 & 2) CORAM : THE CHIEF JUSTICE JUSTICE B.P. ROUTRAY JUDGMENT 4th June 2021 B.P. Routray J. 1. The Petitioner has challenged the technical qualification of Opposite Party No.3 to compete in the bid invited by Opposite Party Nos.1 and 2 for the work “Hiring of Pay Loaders for Mechanical transfer of Coal into Railway wagons at Siding No.VI & VII of Lakhanpur Area for a quantity of 3 83 25 000 Te.” W.P.(C) No.45021 2. The Petitioner is a joint venture company. He along with Opposite Party No.3 and others participated in the bidding process invited by Opposite Party Nos.1 and 2 i.e. Mahanadi Coal Fields Limitedvide Notice Inviting TenderNo.818 2020 657 dated 28th October 2020 for the work stated above. The eligibility criteria at Clause 8(A) prescribes as follows: “8. Eligibility Criteria: A. Work Experience: The bidder must have experience of works of similar naturevaluing 50% of the annualized estimated value of the work50% of the estimated value of the workput to Tender in any year consecutive 365 days) during last 7 years ending last day of month previous to the one in which bid applications are invited. “Annualised value” of the work shall be calculated as the “Estimated value Period of completion in Days x The value of executed works shall be given a simple weightage to bring them at current price level by adding 5% for each completed yearafter the end date of experience till the last day of month previous to one in which e Tender has been invited. The definition of similar work shall be as follows: Loading of coal any mineral soil ash stone rejects by into railway wagons Pay Loaders Excavators In respect of the above eligibility criteria the bidders are required to furnish the following information on line: W.P.(C) No.45021 I. Start date of the year for which work experience of bidder is to be considered for eligibility. II. Start date & end date of each qualifying experience similar nature). III. Work order Number Agreement Number of each IV. Name & address of Employer Work Order Issuing authority of each experience. V. Percentage share of each experience of the NIT the work experience certificate has been defined to the effect that the bidder must have experience of work of similar nature valuing 50% of the annualised estimated value of the work put to tender. As per calculation 50% of the annualised value of the estimated cost comes to W.P.(C) No.45021 Rs.4 18 31 738 . The work experience certificate of Opposite Party No.3 filed at Annexure 3 to the tune of Rs.6 00 72 502 is not matching with the work order submitted by Opposite Party No.3 which has been annexed under Annexure 3 series. Therefore the work experience certificate of Opposite Party No.3 is not a genuine document. 4. Opposite Party No.3 did not come to contest. 5. Opposite Party Nos.1 and 2 who are Tender Inviting Authorities have contested the case by filing their counter. They have refuted the case of the Petitioner by saying that Petitioner has not presented the correct facts in the writ petition. It is their case that Petitioner has submitted three work experience certificates to reveal his qualification in terms of Clause 8(A) of the NIT. The first certificate has been issued by M s.Shyam Metalics and Energy Limited showing work done experience by Opposite Party No.3 to the tune of Rs.6 00 72 502 and two other work showing value of Rs.2 73 91 960 and Rs.1 51 56 032 respectively by M s.Godavari Commodities Limited. 6. As complaint was received from the Petitioner a clarification to the genuineness of the certificate of Opposite Party No.3 was sought from the respective employers viz. M s.Shyam Metalics and Energy Limited and M s.Godavari Commodities Limited. Both the employers have clarified that the work experience of Opposite Party No.3 as mentioned in his certificate is correct. Thereafter the financial bid was opened wherein Opposite Party No.3 was found L 1 and Petitioner was found L 4. Therefore the offer of Opposite Party No.3 was accepted and Letter of Acceptancewas issued to him on 23rd February 2021. W.P.(C) No.45021 7. The entire issue as revealed from rival contentions of the parties is relating to the work experience certificate submitted by Opposite Party No.3 along with his bid document. Admittedly 50% of the annualised estimated value to qualify the bidder is amounting Rs.4 18 31 738 . This experience qualified value is much less than the experience value submitted by Opposite Party No.3 got from M s.Shyam Metalics and Energy Limited and M s.Godavari Commodities Limited as per the work experience certificate submitted by him in the bid. 8. The Petitioner submits that the work order issued by M s.Shyam Metalics and Energy Limited to Opposite Party No.3 for the period from 1st April 2019 to 31st March 2020 is for loading and shifting charges whereas the experience required by MCL is for loading charges only. Thus the Petitioner submits that the experience certificate issued by M s.Shyam Metalics and Energy Limited in favour of Opposite Party No.3 cannot be considered as a valid certificate in terms of the eligibility norms under the NIT. 9. This contention of the Petitioner does not appear to be factually correct. A perusal of the experience certificate of Opposite Party No.3 under Annexure 3 series) the document at Annexure D 2 to the counter and the clarification under Annexure E 2 series reveals that the experience is regarding loading of raw materials only. In those documents nowhere have the shifting charges been mentioned. Those documents speak of loading charges @Rs.10 per MT plus GST. Therefore we do not see any flaw in the tender process as alleged by Petitioner against Opposite Party No.3. Apart from that as seen from the W.P.(C) No.45021 price bid under Annexure I 2 to the counter Petitioner stood L 4 and Opposite Party No.3 stood L 1 in terms of which the price difference is more than Rs.9 crores. 10. The next contention of the Petitioner is that the clarification issued by M s.Shyam Metalics and Energy Limited was on 12th December 2020 whereas the price bids were opened on 7th December 2020. There is no merit in this contention in view of the clear averment of Opposite Party No.2 in their reply that after ascertaining the genuineness of the work experience certificate from the concerned employer a decision was taken by the Tender Committee. 11. The Supreme Court in Jagdish Mandal v. State of Orissa14 SCC 517 held that: in mind. A contract to prevent arbitrariness “22. Judicial review of administrative action is 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 is a commercial tenders and awarding transaction. Evaluating contracts are essentially commercial 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 W.P.(C) No.45021 contractor with a grievance can always seek damages in a civil court. Attempts by unsuccessful tenderers 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. 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 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” If the answers are in the negative there should be no interference under Article 226. Cases involving blacklisting or imposition of penal tenderer contractor or consequences on a distribution of State largesse stand on a different footing as they may require a higher degree of fairness in action.” Whether public interest is affected. 12. In light of the settled legal position as explained by the Supreme Court in the aforementioned decisions there is no merit in the W.P.(C) No.45021 contentions of the Petitioner. Accordingly the writ petition is dismissed. There shall be no order as to costs. 13. As the restrictions due to resurgence of COVID 19 situation are continuing learned counsel for the parties may utilize a printout of the order available in the High Court’s website at par with certified copy subject to attestation by the concerned advocate in the manner prescribed vide Court’s Notice No.4587 dated 25th March 2020 as modified by Court’s Notice No.4798 dated 15th April 2021. Judge B.P. Routray) Chief Justice 4th June 2021 B.K. Barik Secretary W.P.(C) No.45021 