Dismissed

Durgesh Warty and 1 Ors. v. the Municipal Corporation for Greater Mumbai and 4 Ors.

Bombay HC18 Nov 2010PIL/72/2010

Case brief

AI extract

What is this about?

This PIL challenged the award of contracts for Shivaji Park beautification without tendering. The High Court of Bombay held that the corporation did not act arbitrarily, considering the urgency of the 50th-year celebration and specialized skill required for murals. The petition was dismissed and the injunction vacated.

What did the court decide?

Petition dismissed; interim injunction granted earlier vacated.

Durgesh Warty and 1 Ors. Vs the Municipal… — Public Procurement and Tenders | Bombay HC (2010)

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION

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PUBLIC INTEREST LITIGATION NO. 72 OF 2010

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Durgesh Warty and another.

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... Petitioners

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Versus

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The Municipal Corporation of Greater Mumbai and others.

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... Respondents

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Mr. G.S. Godbole i/by Mr. Shailendra S. Kanetkar for the petitioners. Mr. K.K. Singhvi, Senior Advocate with Ms. Geeta Joglekar for MCGM. Mr. A.M. Kulkarni for the applicant in chamber summons No.160 of 2010.

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CORAM : MOHIT S. SHAH, C.J. & S.J. KATHAWALLA, J. Thursday, November 18, 2010

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P .C.

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The respondent-Municipal Corporation decided to undertake the work of beautification of Shivaji Park on the occasion of 50th year of Sanyukta Maharashtra Movement/establishment of State of Maharashtra. The work was divided into two phases as under:

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Phase I

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1. To renovate the existing pathway admeasuring approximately 2500 sq.mtrs. on the side of Swatantrya Veer Savarkar Marg.

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1. Preparing lawn by filling the land at Shivaji Park playground behind Scout Guide Hall on the area ad. 12000 sq.mtrs. and installation of water fountain.

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1. Renovation of existing old seven entrance gates.

Phase II

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1. To renovate remaining existing pathway around Shivaji Park.

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1. To provide electric poles on the pathway around the Shivaji Park Playground.

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1. To install fibre benches for citizens, along the periphery of pathway.

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The grievance in the present PIL is that the contract for the above works was awarded in favour of respondent Nos.3 and 4 without following the procedure laid down in sections 67, 69 and 72 of the Mumbai Municipal Corporation Act, 1888. Particularly, the grievance is made against the decision to award the contracts without inviting tenders and, therefore, the alleged violation of section 72(3) of the Act.

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In the affidavit-in-reply dated 4th May, 2010 filed by the Assistant Commissioner, G/North Ward, Mumbai Municipal Corporation, it is pointed out by the Corporation that the work of phase I was completed and the petitioner did not challenge the same. As far as the work in phase II is concerned, 65% of the work is completed. For this work, the respondent No.1 had displayed the banner at the site informing the public about the specific work of erecting wall at the entrance and to fix murals of coronation ceremony of Shivaji Maharaj and the mural of procession alongwith traditional lamp post alongwith the work of electrification and beautification of pathway. By letter dated 10th March, 2010, Citizens Forum actively working in G/North Ward was informed about the said work.

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It is further averred in the reply affidavit that respondent No.3 was appointed as contractor for G/N Ward where in Shivaji Park is situated, for a period of two years from April, 2008 to April, 2010 for the work of

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beautification of Shivaji Park on the occasion of 50th year of Sanyukta Maharashtra Movement/establishment of State of Maharashtra. The contract of respondent No.3 was further extended for a period of 36 months by the Standing Committee resolution No.58 dated 9th April, 2008 for development and maintenance of gardens, playgrounds, recreation grounds as well as traffic islands. By Resolution No.495 dated 23rd July, 2008, the Standing Committee had relaxed the condition of inviting tenders. The work of beautification of Shivaji Park was entrusted to respondent No.3 by obtaining sanction of Standing Committee in August, 2009. By resolution No.1470 dated 11th February, 2009, the Standing Committee sanctioned the first phase of development and beautification of Shivaji Park.

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As far as Phase II work is concerned, the Standing Committee had passed resolution No.1414 on 18th February, 2010.

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It is pointed out in the affidavit-in-reply and the learned counsel for the Municipal Corporation has also submitted that the work was required to be undertaken on emergent basis in view of the ensuing celebrations on the occasion of Installing of Bronze Mural of Coronation Ceremony of Chhatrapati Shivaji Maharaj and the procession on the walls on completion of 50th years of Sanyukta Maharashtra Movement on 1st May, 2010. It is further stated that the work was not only very urgent but it was also specialised work of making murals. The contract was awarded to respondent No.4 after informing the public at large about the work to be undertaken and as per the general notice to the public on 10th March, 2010.

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The contention of the petitioners in this public interest litigation is that the respondent authorities acted arbitrarily in awarding the contracts in

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favour of respondent Nos.3 and 4 without inviting tenders. It is also contended that the Standing Committee resolutions passed subsequently for ratifying the act of awarding the contracts cannot be considered as legal and in accordance with the provisions of section 72(3) of the Act. It is submitted that if this is allowed, the respondents will go on awarding contracts involving large sums of monies without inviting tenders.

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Mr. Singhvi, learned senior advocate for the respondent Municipal Corporation, has opposed the petition and submitted that the Standing Committee has power under sub-section (3) of Section 72 to authorize Municipal Commissioner to award contracts without inviting tenders. Since the beautification of Shivaji Park in the heart of Greater Mumbai was required to be undertaken on the occasion of 50 years of the Sanyukta Maharashtra Movement and establishment of the State of Maharashtra, an informal meeting of the Standing Committee was held at the residence of the Mayor and it was decided to authorize the Municipal Commissioner to take up the work of beautification of Shivaji Park and installation of murals of coronation ceremony of Shivaji Maharaj and the mural of procession, etc., and accordingly the Municipal Commissioner had entrusted the work to respondent Nos.3 and 4. The Standing Committee thereafter passed formal resolutions ratifying the above actions of the Municipal Commissioner. It is further submitted that even before the present petition was taken up for hearing, the contract had already completed the work under Phase I and 65% of the work under Phase II was completed. It is submitted that as far as respondent No.3 is concerned, he was the existing contractor and since the Corporation was satisfied with his work and the beautification work on the occasion of 50 years celebration was required to be done urgently, the respondent authorities did not act arbitrarily in awarding the contract to respondent No.3 for the beautification work of Shivaji

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Park.

As regards the contract awarded to respondent No.4 for making and installing murals, the learned Counsel for the respondent Corporation submitted that the work of making murals of coronation ceremony of Shivaji Maharaj and the mural of procession along with traditional lamp post are specialized works and the contracts for making such specialized works cannot be awarded by inviting tenders and selecting the lowest bidder. It is further submitted that the murals on one side of the gate are already complete and only the murals of the other side of the gate remained to be completed and thus 50% of the contract awarded to respondent No.4 is already executed and now undertaking the process of inviting tenders for the second part of the murals is not practicable.

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As regards contracts awarded to respondent No.3, 100% of the work under Phase I and 65% of the work under Phase II is completed and, therefore, also the contention that tenders should be invited cannot be accepted at this stage as the work already commenced must be allowed to be completed otherwise there will be disharmony in the implementation of the beautification project.

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The relevant provisions relied upon by the learned counsel for the petitioners read as under:-

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"67. Exercise of powers to be subject to sanction by Corporation of the necessary expenditure.- The exercise by any municipal authority of any power conferred or the performance of any duty imposed by or under this Act, which will involve expenditure, shall, except in any case specified in sub-section (2) of section 115 *[or of section 470DD] be subject to the following provisos, namely:-

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(a) that such expenditure, so far as it is to be incurred in which such power is exercised or duty performed, shall be provided for under a current budget grant within the meaning of that expression as defined in section 130.

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(b) that, if the exercise of such power or the performance of such duty involves or is likely to involve expenditure for any period or at any time after the close of the said official year, liability for such expenditure shall not be incurred without the sanction of the Corporation.

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69. Power to the Commissioner to execute contracts on behalf of the corporation.- With respect to the making of contracts under or for any purpose of this Act, the following provisions shall have effect, namely:-

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(a) every such contract shall be made on behalf of the corporation by the Commissioner;

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(b) on such contract, for any purpose which in accordance with any provision of this Act, the Commissioner may not carry out without the approval or sanction of some other municipal authority, shall be made by him until or unless such approval or sanction has first of all been duly given;

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(c) no contract, other than a contract relating to the acquisition of immovable property or any interest therein or any right thereto, which involves an expenditure exceeding rupees ten lakhs but not exceeding rupees fifteen lakhs, shall be made by the Commissioner unless the same is previously approved by the Mayor. For contracts involving an expenditure in excess of fifteen lakh rupees, approval of the Standing Committee shall be necessary:

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Provided that, the total amount of all sanctions granted by the Mayor shall not exceed one crore rupees during a year:

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Provided further that, the Standing Committee shall consider and dispose of the proposals made by the Commissioner within thirty days from the receipt thereof,

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failing which the previous approval of such contract shall be deemed to have been given by the Standing Committee and a report to that effect shall be made by the Commissioner to the Corporation.

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72.

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Tenders to be invited for contracts involving expenditure exceeding [Rs.50,000].- (1) Except as is hereinafter otherwise provided, the Commissioner shall, at least seven days before entering into any contract for the execution of any work or the supply of any materials or goods which will involve an expenditure exceeding [ fifty thousand rupees,] give notice by advertisement in the local newspapers, inviting tenders for such contract.

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(2) The Commissioner shall not be bound to accept any tender which may be made in pursuance of such notice, but may accept, subject to the provision of clause (c) of Section 69, any of the tenders so made which appears to him, open a view of all the circumstances, to be the most advantageous.

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(3) Provided that the Standing Committee or in the case of a contract to be entered for the purposes of clause (q) of Section 61, the Education Committee may authorize the Commissioner, for reasons which shall be recorded in their proceedings, to enter into a contract without inviting tenders as herein provided or without accepting any tender which he may receive after having invited them."

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(emphasis supplied)

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There is no dispute about the fact that the Standing Committee of the Municipal Corporation passed resolutions under sub-section (3) of Section 72 of the Act for awarding contracts in favour of respondent Nos.3 and 4 by relaxing the requirement under sub-section (1) of Section 72 to invite tenders. Considering the fact that the Standing Committee took the decision for the purpose of commencing and completing beautification work for the purpose of 50 years celebration for the Sanyukta Maharashtra Movement/establishment of the State of Maharashtra and, therefore, the project was required to be

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completed within a short time limit, it cannot be said that the Standing Committee of the respondent or the Corporation acted arbitrarily in dispensing with the requirement of inviting tenders. It is true that the date on which the celebrations were to be commenced must have been known to the respondents and the entire project could have been planned well in advance. However, in the facts and circumstances of the present case, particularly the fact that the mural of coronation ceremony of Shivaji Maharaj and the mural of procession were required to be made, which is definitely a work of specialized nature, and also considering the fact that a general notice was given to the public on 10^th March 2010 that such project was being undertaken and that the amount awarded for the said work to respondent No.4 is only Rs.1.28 crores, this Court is not inclined to interfere with the said decision in exercise of its discretion under extra ordinary writ jurisdiction and that too in public interest litigation wherein no grievance is made by any other Architect that he was ready to do such work for less than Rs.1.28 crores.

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As far as the contract awarded to respondent No.3 is concerned, the amount involved is Rs.3.15 crores and considering the nature of the work in Phase I and Phase II as indicated above, if the Corporation decided to entrust the work to an existing contractor, it cannot be considered to be so arbitrary that the Court must interfere at this stage when 100% of the work is completed under Phase I and 65% work is completed under Phase II.

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We make it clear that we are not inclined to interfere with the above decisions of the respondent Corporation in view of the fact that substantial work of both the phases is completed and 50% of the work of making murals is completed and the Corporation was facing the deadline for completing the above works and, therefore, contracts were awarded without

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inviting tenders.

At the same time we should not be treated to have approved of the manner in which the respondents took the impugned decisions. The respondents could have planned the works well in advance in order to ensure that the necessary procedure would be followed, but we can not overlook the practical realities where sometimes such decision to celebrate an event is taken by a public authority just before the event.

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Subject to the above observations, the petition is dismissed. The interim injunction granted earlier is vacated forthwith.

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At this stage, the learned counsel for the petitioners prays to continue the injunction which was granted by this Court earlier. As far as Phase I work is concerned, it is already completed. As far as Phase II work is concerned, according to the respondent-Corporation, 65% work is already completed and the work of making murals is also completed to the extent of 50% and is placed on one side of the gate. The mural on the other side is required to be completed. In view of the peculiar facts and circumstances of the case, we are not inclined to entertain the prayer as this is not a fit case to continue the interim injunction. Request is rejected.

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CHIEF JUSTICE

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S.J. KATHAWALLA, J.

Durgesh Warty and 1 Ors. v. the Municipal Corporation for Greater Mumbai and 4 Ors.

Case brief

What is this about?

What did the court decide?

Durgesh Warty and 1 Ors. v. the Municipal Corporation for Greater Mumbai and 4 Ors.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

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