Allowed

N.E. Trade and Transport and Anr. v. Food Corpn. of India and 3 Ors.

Gauhati HC3 Apr 2018WP(C)/4111/2017

Case brief

AI extract

What is this about?

The Guwahати High Court dismissed the FCI's reliance on an alternative remedy clause due to superior authority approval. It struck down the new payment rate calculation as arbitrary, holding the petitioner must be paid their original quoted rate per MT per KM for the actual distance.

What did the court decide?

Respondent directed to pay at petitioner's quoted rate of Rs. 11.41 per MT per KM for 295.1 KMs within 3 months of order receipt.

N.E. Trade and Transport and Anr. Vs Food Corpn. of… — Writ and Judicial Review | Gauhati HC (2018)

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GAHC010198682017

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THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)

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Case No. : WP(C) 4111/2017

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1:N.E. TRADE and TRANSPORT and ANR.

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A PROPRIETORSHIP FIRM HAVING ITS OFFICE AT SREENAGAR, G.S. ROAD, GUWAHATI-5, ASSAM REPRESENTED BY ITS PROPRIETOR SMT NEENA SAIKIA.

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2: SMT NEENA SAIKIA

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D/O. SHRI PRANJIT SAIKIA R/O. SREENAGAR, G.S. ROAD GUWAHATI-5 PROPRIETOR OF N.E. TRADE AND TRANSPORT

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VERSUS

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1:FOOD CORPN. OF INDIA and 3 ORS.

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A STATUTORY BODY, ESTABLISHED UNDER THE FOOD CORPORATION ACT 1964, HAVING ITS HEADQUARTERS IN NEW DELHI AND A REGIONAL OFFICE AT GUWAHATI, G.S. ROAD, PALTANBAZAR, ABOVE FBB, MT TOWER 3RD TO 5TH FLOOR, GUWAHATI, KAMRUP METRO ASSAM, PIN781008, REPRESENTED BY ITS CHAIRMAN and MANAGING DIRECTOR.

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2:THE GENERAL MANAGER CONTRACTS FOOD CORPORATION OF INDIA ZONAL OFFICE NE, G.S. ROAD, G.L. PUBLICATION BUILDING ULUBARI, GUWAHATI-7.

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3:THE ASSTT. GENERAL MANAGER CONTRACTS FOOD CORPORATION OF INDIA NORTH EASTERN REGION, G.S. ROAD, PALTANBAZAR ABOVE FBB, MT TOWER 3RD FLOOR TO 5TH FLOOR GUWAHATI, KAMRUP METRO ASSAM, PIN-781008.

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4:THE AREA MANAGER

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FOOD CORPORATION OF INDIA, DISTRICT OFFICE, SILCHAR

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Advocate for the Petitioner : MR.N DEKA

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Advocate for the Respondent :

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BEFORE HONOURABLE MR. JUSTICE ARUP KUMAR GOSWAMI

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JUDGEMENT AND ORDER (ORAL)

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Date : 03-04-2018

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Heard Mr. N. Deka, learned counsel appearing for the petitioner. Also heard Mr. S. K. Chakraborty, learned Standing counsel, Food Corporation of India (FCI), appearing for the respondents.

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A Notice Inviting E-tender (NIT) dated 30.03.2015 was uploaded by the General Manager, FCI, Regional Office, Assam Region, in the Central Procurement Portal of the FCI inviting tenders online under “Two Bid Tendering System” for appointment of a regular contractor, with or without requisite experience, with strong financial background for a period of two years for transportation of food grains/sugar/allied materials, amongst others, from “Ex-railway Siding, Salchapra to FCI, FSD Arundhutinagar, Tripura, via weighbridge (Distance 243 KMs)”. In the NIT, amongst others, it was notified as under:

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“The rate should be quoted as per MT per KM as per MTF. If rate is quoted otherwise it shall be converted to per MT per KM taking distance as mentioned above.” “MT per KM” and “MTF” are the abbreviations for “Metric Ton per Kilometer” and “Model Tender Form” respectively.

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The petitioner No. 1 firm, of which the petitioner No. 2 is the proprietor, submitted tender @ Rs. 11.41 per MT per KM in respect of Ex-railway Siding, Salchapra to FCI, FSD Arundhutinagar, Tripura, via weighbridge and the petitioner firm having emerged as the lowest tenderer, the General Manager (Region), FCI, Regional Office, Assam Region, issued a letter dated 29.06.2015 (Annexure-B) appointing the petitioner as transport contractor for a period of two years for transporting goods of the FCI from Ex-railway Siding, Salchapra to FCI, FSD Arundhutinagar, Tripura, via weighbridge. The petitioner accordingly started transporting goods and raised bills taking the distance to be 243 KMs, as specified in the NIT.

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However, the petitioners found that the distance between Ex-railway Siding, Salchapra to FCI, FSD Arundhutinagar, Tripura, is not 243 KMs, but 295 KMs and, accordingly, submitted representations dated 07.12.2015 and 20.05.2016 to the General Manager, FCI, requesting him to make payment of the differential amount in view of distance being wrongly indicated in the NIT.

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It appears that based on an Order No. S&C/1733/Assam/2015 dated 19.08.2016, issued by the Regional Office, FCI, Guwahati, a committee was constituted to verify the shortest motorable distance from Railway Siding, Salchapra to FST Arundhutinagar and the committee submitted a report dated 12.09.2016 (Annexure-F). The Members of the said committee were (i) Manager (Contract), FCI Regional Office, Assam, (ii) Manager (Storage), FCI Regional Office, Assam, (iii) Manager (Movement), FCI, Divisional Office, Silchar and (iv) Manager (Accounts), FCI, Divisional Office, Silchar. The relevant portion of the report reads as under:

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“As per FCI, RO, Guwahati’s office order No. S&C/1733/Assam/2015 dated 19.08.2016, the undersigned committee members of RO as well as DO, Silchar proceeded to verify the Shortest Motorable Distance from Railway siding Salchapra to FST Arundhutinagar, Nandanagar and Chandrapur and Ex-Rly Siding Bihara to FST Chandrapur on 23.08.2016 by a vehicle (Scorpio bearing registration No. AS 11-BC-9697) hired by the District Office, Silchar.

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The starting point was taken from the beginning point of Salchapra siding and proceeded via Weighbridge. Digital Mile Meter was made “0” (zero) at the beginning point of the Salchapra Siding and Bihara Siding. As the journey was not possible to complete in one single day the committee decided to break the total journey into some Milestone points.

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Total milestone-wise road distance measurement recorded by the committee based on the “Digital Mile Meter” of the hired vehicle are as follows:

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From	To	Distance
Beginning point of Salchapra	Badarpurghat-Silchar	14.5 KMs
Sidingvia Weighbridge	diversionpoint
Badarpurghat-Silchar	Khoyarpur Highway Bypass	262.5 KMs
diversionpoint	point(Tripura)via National

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	Highway
Khoyarpur Highway Bypass	FST, Arundhutinagar via	18.1 KMs
point	Amtali bypass
TOTA	L	295.1 KMs
***	* *
***	* *

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It is to mention here that the committee had strictly followed the shortest motorable road through which Lorries/trucks are plying i.e. National Highway 44 (National Highway 8).”

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It appears that the Deputy General Manager (R) had issued a letter dated 20.01.2017 (Annexure-I) for General Manager (R) recording therein that a team constituted to verify the distance found that there is difference in the distance as published in the NIT with the distance as claimed by the transport contractors. It is also stated therein that the claims for extra payment due to extra/increase in distance of the transport contractors cannot be considered in view of the MTF paragraph B II of General Information to Tenderers, which provided that tenderers would be deemed to have fully acquainted with the routes to be taken by them for transportation of food grains/sugar, etc., and the location of godown vis-àvis loading/unloading points before submission of the tender and, therefore, they would not be entitled for any compensation on account of road blockade, diversion, etc.

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It appears that there was a rethinking with regard to the payment claimed by the transport contractors on account of the extra distance. In this context, a letter dated 20.06.2017 (Annexure-K) was issued by the Assistant General Manager (Contract), FCI, Assam Region, to the Area Manager, FCI, District Office, Silchar. It will be appropriate to extract herein below the said letter in its entirety:

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“ NO. S & C/1699/ASSAM/2015 Date: 20.06.2017

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Area Manager

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Food Corporation of India

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District Office, Silchar.

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Sub: Payment of extra distance charge to M/s NE Trade & Transport Pvt. Ltd., Ghy, Transport Contractor Ex-Rly siding Salchapra to FCI, FSD Arundhuti Nagar via weighbridge-regd.

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Ref: I) Zonal Office letter no. Cont. 1(385)/NEZ/Assam/Misc./2017 (copy enclosed).

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II) TC M/s NE Trade & Transport Pvt. Ltd. representation letter no. Nil dated 09.12.2015 and 20.05.2016.

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Sir,

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You are aware that the actual distance Ex-Rly Siding Salchapra to FSD Arundhuti Nagar via Weighbridge was verified to be 295.1 Kms against 243 Kms of NIT published on the basis of the report of District office committee. The representation of the TC, M/s NE Trade & Transport Pvt. Ltd. regarding transportation cost for the extra distance moved was examined by this office as well as ZO (NE). ZO (NE) vide letter as cited conveyed approval for regulating the payment as per genuine and actual distance. The competent authority has approved that the benefit of extra distance of 52.1 Km distance transported by M/s NE Trade & Transport Pvt. Ltd. be limited to the revised rate of L2 tenderer, M/s Anup Trade & Transport Pvt. Ltd. As such the revised rate per MT/KM is calculated @ 9.48/- PMT/KM (Rs. 2799/- PMT/295.1 KMs) for this entire distance.

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You are requested to take necessary action regarding release of payment for extra distance of 52.1 Kms amounting to Rs. 11,24,848.35 (Eleven lakhs twenty four thousand eight hundred & forty eight point three five) only for the movement of 45142 MT quantity. The details are as tabulated below:

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*Rate* *(per MT* *Per KM)* *(A)*	*(KMs)* *Original*	*Revised*	*Distance* *Difference*	*Quantity moved* *(w.e.f. Oct’ 15 to Apr’* *16)* *(E)*	*Cost as per Original* *distance*	*Cost as per revised* *distance (G) = (A x C* *x E)*	*Difference (amount for* *repayment)* *(I) = (G) – (F)*
	*(B)*	*(C)*	*(D)*
` *11.41*	*243*	*295.1*	*52.1*	*45142 MT*	`*12,51,62,063.46*		` *11,24,848.35*

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Page No.# 6/11

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295.1 52.1 45142 MT **_12,62,86,911.81_** 9.48

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Reply of the district office committee who had submitted erroneous distance against the SCN issued from this office vide letter No. S & C/1733/Assam/2015 dtd. 26.04.2017 had not been received till date from your end. Kindly forward the reply of the concerned officers within 7 days as otherwise disciplinary proceedings shall be initiated considering they have nothing to reply.

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This issues with the approval of the Competent Authority.”

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Mr. N. Deka, learned counsel for the petitioners has submitted that there is no dispute that the actual distance between Ex-railway Siding, Salchapra, to FCI, FSD Arundhutinagar, Tripura, via weighbridge is 295.1 KMs and not 243 KMs as projected in the NIT and, therefore, the petitioners had to transport goods for the distance of 295.1 KMs. While asserting that the petitioners would be entitled to extra compensation for the extra distance as per the rate per MT per KM being specified by the petitioner in the tender submitted by the petitioners, the petitioners could not have been arbitrarily paid @ 9.48 per MT per KM for the entire distance of 295.1 KMs. He submits that the figure of Rs. 9.48 per MT per KM was arrived at by dividing the amount of Rs. 2,799.00 (which was the total transportation cost offered by the L2 bidder for the distance of 243 KMs) by 295.1 KMs (i.e., total distance in the case of the petitioners). He has pointed out that the L2 bidder had quoted his rate of Rs. 2,799.00 for 243 KMs and, therefore, the very foundation of the calculation is, ex facie, fallacious and not sustainable in law.

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Mr. Chakraborty, at the outset, submits that this writ petition is not maintainable as the petitioners have not availed alternative remedy for redressal of the grievance under Clause-XX of the terms governing the contract. He has referred to paragraphs 6, 7, 8 and 9 of the counter-affidavit to contend that the rate offered at Rs. 9.48 per MT per KM is justified.

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I have considered the submissions of the learned counsel for the parties and have perused the materials on record.

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Clause-XX, on which Mr. Chakraborty has placed reliance, reads as follows:

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“XX Law governing the contract & dispute resolution. (a) The contract will be governed by the laws of India for the time being in

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force.

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(b) In case of any disputes arising out of and touching upon the contract, the same will be first referred to the Dispute/Grievance Redressal Committee constituted and functioning at the Zonal Office of the Corporation, with a view to settle the disputes. If any disputes remain thereafter the same will be settled in the court of law having competent jurisdiction.”

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In the letter dated 20.06.2017, it is indicated that the said letter was issued with the approval of the competent authority, which, Mr. Chakraborty submits, is the Executive Director, FCI. On a specific query of the court, Mr. Chakraborty has submitted that the Dispute/Grievance Redressal Committee, functioning at the Zonal Office of the FCI, is consisting of officials who are placed much below the rank of the Executive Director. If that be so, I do not find substance in the arguments of Mr. Chakraborty that this writ petition is liable to be dismissed on the ground of the petitioners not availing alternative remedy inasmuch as when the superior authority had approved a decision, it cannot be countenanced that alternative remedy, as provided for in Clause-XX, is efficacious. A writ petition may not be entertained in exercise of powers conferred under Article 226 of the Constitution of India when alternative remedy available is also efficacious. This court finds that in the facts and circumstance of the case, it is not possible to hold that the petitioners had not availed efficacious alternative remedy and, therefore, the contention of Mr. Chakraborty is rejected.

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Paragraphs 6, 7, 8 and 9 of the counter-affidavit of the respondents, on which Mr. Chakraborty relies upon, reads as follows:

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“6. That the deponent begs to state that, by taking the distance between Rly. Siding Salchapra to FCI, FSD Arundhutinagar, Tripura, to be 295.1 KMs, the comparative rate quoted by the aforesaid two bidders, at per MT/per KM, was ascertained in terms of the relevant tender clause, as provided in the NIT dated 30.03.2015 and the same came out as under:-

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(i) NE Trade & Transport, Ghy – Rs. 11.41/- per MT per KM (i.e. Rs. 11.41 X 295 KM to entire distance) 3367.09 PMT for the entire distance)

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(ii) Anup Trade & Transport Pvt. Limited Ghy, Rs. 2799 per MT for

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entire distance) Rs. 2700/295.1 KM = Rs. 9.48 per MT for the entire distance).

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Therefore, in the event, the correct distance of 295.1 KMs, would have been taken into consideration at the time of comparative assessment of rates, the writ petitioner with Rs. 11.41 per Km/per MT, would have been adjudged as L-2 bidder and M/s Anup Trade and Transport Pvt. Limited with Rs. 9.48 per KM/per MT, would have come out to be the L-1 bidder.

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That, in view of the aforesaid finding, instructions were sought by the FCI Regional Office, from the FCI, Zonal Office, to arrive at a final decision into the matter. The FCI, Zonal office, thereafter, thoroughly examined the matter along with another similar complaint in respect of a different route viz. Rly Head Bihara to FCI, FSD Chandrapur, and after such examination, had given necessary instructions to the FCI Regional Office, Assam. The FCI, Regional Office, thereafter, has taken the final decision into the matter (in File No. S & C/1733/Assam/15) as under:

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A. Bihara to Chandrapur

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*Participants*	Di *Original*	*stance (in Kms)* *Revised*	*Rate* *quoted*	*Rat* *As per* *original* *distance*	*e per MT* *As per* *Revised* *distance*	*Remarks* *Original L1* *remains same.*
*NE Trade &* *Transport*	*336*	*352.6*	*Rs. 7.17/-* *PMT/PKM*	*Rs. 2409.12*	*Rs. 2528.14*	*No change in* *Inter se even* *after*
*Purbanchal* *Communication*			*Rs. 8.01/-* *PMT/PKM*	*Rs. 2691.36* *PMT/PKM*	*Rs. 2824.32*	*considering* *revised*
s *Pvt. Ltd.*						*distance*
*Shivam* *Transcon* *Pvt. Ltd.*			*Rs. 2,599/-* *PMT*	*Rs. 2599/-*	*Rs. 2599/-*

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B. Salchapra to Arundhutinagar

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*Participants*	*Distance (in Kms)* *Original* *Revised*	*Rate* *quoted*	*As per* *original* *distance*	*Rate per MT* *As per* *Revised* *distance*	*Remarks* *Original L1*

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*NE Trade &* *Transport* *243* *Anup Trade &* *Transport Pvt.* *Ltd.*	*295.1*	*Rs. 11.41* *PMT/PKM* *Rs. 2799/-*	*Rs. 2772.63* *Rs. 2799/-*	*Rs. 3367.09* *Rs. 2799/-*	*changes with* *change in* *distance thus* *there is* *change in* *Inter se*

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In case of table ‘A’, N.E. Trade and Transport is original L-1 and even on revising the distance as verified by RO Committee it is observed that N.E. Trade and Transport remains L-1, hence there is no any change of inter se due to revision of distance. In case of table ‘B’, though N.E. Trade and Transport is original L-1 as per distance of district committee/NIT. However, on revising the distance as re-verified by RO Committee it is observed that N.E. Trade and Transport turns out to be L-2. Hence there is change of inter se due to revision of distance. In this regard the decision of ED (NE) directed vide order No. Cont. 1(466)/NEZ/GRC/2014 dtd. 09.06.2015 (Sl. No. 105) may please be seen. In the aforesaid case ED (NE) had directed that the original rate of the L-1 tenderer, which was per MT basis be revised to Per MT/KM rate of inter se tenderer whose rate turn to be L-1 on revising the distance. The facts of the present case are also similar to the case settled by ED (NE) as cited and accordingly it is proposed for remuneration to the TC considering the inter se/new L-1 rate.

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The benefit of extra distance transported by M/s NE Trade & Transport Pvt. Ltd. be limited to the revised rate of L-2 tenderer, M/s Anup Trade & Transport Ltd. As such the revised rate per MT/KM is calculated @ 9.48/- PMT/KM (Z-2799/-PMT/295.1 KMs)”.

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An extract of the relevant note sheet in the concerned file No. S&C/1733/Assam/15 is annexed as Annexure 1 to this affidavit in opposition.

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The deponent craves leave of this Hon’ble Court to allow him to produce the original record of the same, at the time of final hearing.

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That the deponent begs to state that in terms of the aforesaid decision taken, the writ petitioner would be entitled to a total amount of Rs. 11,24,848.35 (Rupees eleven twenty four thousand eight hundred forty eight and thirty five paise), towards additional transportation charges, though the petitioner M/s N.E. Trade and transport has quoted its rate at per MT/per KM basis for the distance – Ex-Rly Siding Salchapra

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to FCI, FSD Arundhati Nagar, Tripura @ Rs. 11.41/- on per MT per KM basis.

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It would be curious to note that the writ petitioner M/s N.E. Trade and Transport has raised no grievance in respect of the same manner/yardstick of re-assessment of rate, as made in respect of his contract (A) Ex-Rly Siding Bihara to FCI, FSD Chandrapur as stated above, because there was no change in the inter-se position following such revision, but the manner or the yardstick adopted became faulty to him when his rate came out to be L-2 in respect of his contract (B) Ex-Rly Siding Salchapra to FCI, FSD Arundhati Nagar. The petitioner cannot be allowed to blow hot and cold together.

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That with regard to the statements made in paragraphs 1 to 23 of the writ petition, the deponent denies and disputes the same save and except those which are borne by records. While reiterating the various statements made in the preceding paragraphs of the instant affidavit-in-opposition, the deponent begs to state that it is the public interest which weighed with the authorities in taking the decision to pay for the extra distance of 52.1 KM @ Rs. 9.48 per MT/per KM. The writ petitioner is a regular transport contractor and has been working in the field of transportation contract and is therefore aware about the actual distance Ex-Rly siding Salchapra to FCI, FSD Arundhati Nagar, Tripura, for which the bids were invited and has quoted its rate accordingly. With the distance of 295.1 KMs, therefore the comparative rate at per MT/per KM between the two places having now come out to be Rs. 11.41/- for the petitioner and Rs. 9.48/- for its competitive bidder, M/s Anup Trade & Transport, the petitioner would only be the L-2 bidder and not L-1 bidder. The transportation from Rly. Siding Salchapra to FCI, FSD Arundhati Nagar having stopped thereafter, after the NF Rly made the B.G. line operational in that sector, the authority found that it would be just and proper at this stage to make payment to the petitioner @ Rs. 9.48 at per KM/per MT basis for the additional distance of 52.1 KM, which come out to a total amount of Rs. 11,24,848.35 (Rupees eleven lakhs twenty four thousand eight hundred forty eight and paise thirty five) to secure the ends of justice. There being no illegality in the decision making process, the challenge made by the petitioner it not maintainable. The writ petition filed by the petitioner is, therefore, liable to be dismissed.”

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The L-2 tenderer had quoted Rs. 2,799.00 for a distance of 243 KMs and, based on the same, the rate of Rs. 11.52 per MT per KM was arrived at by the respondent authorities. The petitioner had quoted Rs. 11.41 per MT per KM and thus he had emerged as the L-1 tenderer. However, the respondents have now taken the said rate of Rs. 2,799.00 to be the rate offered by the L-2 tenderer for the distance of 295.1 KMs, which is not the case. The NIT itself made it very clear that the rate per MT shall be as per MTF and if the rate is quoted otherwise, rate per MT per KM will be worked out taking the distance as notified in the NIT, which is 243 KMs. In this factual background, the exercise undertaken by the respondents to find out as to what would have been the rate of L-2 bidder for per MT per KM, by dividing Rs. 2,799.00 by 295.1 KM, is arbitrary, irrational and defies all logic. When the petitioners had quoted a rate for per MT per KM, the rate of the petitioners should have been applied for the entire distance instead of trying to figure out as to what would have been the rate of L-2 bidder for the distance of 295.1 KMs. Who knows what rate he would have quoted for 295.1 KMs. That apart, the NIT does not provide taking of such a recourse. It also appears that the respondents had reduced the rate of Rs. 11.41 per MT per KM quoted by the petitioners to Rs. 9.48 per MT per KM for the entire distance of 295.1 KMs. In the considered opinion of the court, the calculations made has no basis and logic whatsoever.

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In view of the above discussions, the respondents are directed to make payment to the petitioners at their quoted rate of Rs. 11.41 per MT per KM for the entire distance of 295.1 KMs. If any amount has already been paid to the petitioners, the same shall be adjusted while making final payment to the petitioners. Payment shall be made to the petitioners within a period of three months from the date of receipt of a certified copy of this order by the General Manager, FCI, Assam Region.

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Writ petition stands allowed in terms of the above. No cost.

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JUDGE

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Comparing Assistant

N.E. Trade and Transport and Anr. v. Food Corpn. of India and 3 Ors.

Case brief

What is this about?

What did the court decide?

N.E. Trade and Transport and Anr. v. Food Corpn. of India and 3 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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