Dismissed

M/S. J.K.Commercial v. the State of Assam and 6 Ors.

Gauhati HC7 Mar 2019WP(C)/6506/2017

Case brief

AI extract

What is this about?

The Gauhati High Court dismissed two writ petitions challenging the cancellation of a tender process and the subsequent disqualification of a vendor. The Court held that since both parties intervened in the tender evaluation to benefit themselves, the authority's decision to cancel and re-tender could not be faulted.

What did the court decide?

The writ petitions seeking to set aside the cancellation of the tender process and the disqualification of the tenderers were dismissed.

M/S. J.K.Commercial Vs the State of Assam and 6 Ors. — Corruption | Gauhati HC (2019)

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Page No.# 1/8

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GAHC010046152017

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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) 6506/2017

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1:M/S. J.K.COMMERCIAL

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A SOLE PROPRIETORSHIP FIRM REP. BY ITS SOLE PROPRIETOR- JIBON KEOT, S/O. SHRI KESHOB KEOT, R/O. FLAT NO. D-12, PRAGJYOTISHPUR HOUSING COMPLEX, GHORAMARA, KHANKA ROAD, P.S. HATIGAON, GUWAHATI-781028, DIST. KAMRUP M, ASSAM.

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VERSUS

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1:THE STATE OF ASSAM and 6 ORS.

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REP. BY THE COMM. and SECY., REVENUE and DISASTER MANAGEMENT DEPTT., DISPUR, GUWAHATI.

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2:THE COMM. and SECY. FINANCE DEPTT. GOVT. OF ASSAM DISPUR GUWAHATI-781006.

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3:THE DY. SECY. TO THE GOVT. OF ASSAM FINANCE EC-II DEPTT. DISPUR GUWAHATI-6.

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4:THE ASSAM LAND MANAGEMENT and INFORMATION SOCIETY ALMIS UNDER THE DEPTT. OF REVENUE and DISASTER MANAGEMENT GOVT. OF ASSAM OFFICE OF THE DIRECTOR OF LAND RECORDS AND SURVEYS RUPNAGAR

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GUWAHATI-781032. REPRESENTED BY ITS CHAIRMAN.

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5:THE CHAIRMAN

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THE ASSAM LAND MANAGEMENT and INFORMATION SOCIETY ALMIS A GOVT. OF ASSAM UNDERTAKING OFFICE OF THE DIRECTOR OF LAND RECORDS AND SURVEYS

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Page No.# 2/8

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RUPNAGAR GUWAHATI-781032.

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6:THE CHIEF EXECUTIVE OFFICER CEO

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THE ASSAM LAND MANAGEMENT AND INFORMATION SOCIETY ALMIS A GOVT. OF ASSAM UNDERTAKING OFFICE OF THE DIRECTOR OF LAND RECORDS AND SURVEYS RUPNAGAR GUWAHATI-781032.

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7:BMG INFORMATICS PVT. LTD. A PRIVATE LTD. COMPANY REPRESENTED BY ITS DIRECTOR NAMELY JOYDEEP GUPTA HAVING ITS REGISTERED OFFICE AT DISHA ENCLAVE 1ST FLOOR WILLS LIFESTYLE ANNEX. BUILDING ARUNADOY PATH CHRISTIANBASTI GUWAHATI-781005

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Advocate for the Petitioner : MR.D TIWARI

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Advocate for the Respondent :

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1:B M G INFORMATICS PVT LTD A PVT. LTD. COMPANY REP. BY ITS DIRECTOR NAMELY JOYDEEP GUPTA HAVING ITS REGD. OFFICE AT DISHA ENCLAVE 1ST FLOOR WILLS LIFESTYLE ANNCX. BUILDING ARUNADOY PATH CHRISTIANBASTI GUWAHATI

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VERSUS

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1:THE STATE OF ASSAM AND 6 ORS REP. BY THE COMM. AND SECY. REVENUE AND DISASTER MANAGEMENT DEPTT. DISPUR

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Page No.# 3/8

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GHY.

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2:THE COMMISSIONER AND SECY. FINANCE DEPTT. GOVT. OF ASSAM DISPUR GHY.

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3:THE DY. SECRETARY TO THE GOVT. OF ASSAM FINANCE (EC-II) DEPTT. DISPUR GHY.

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4:THE ASSAM LAND MANAGEMENT AND INFORMATION SOCIETY (ALMIS) UNDER THE DEPTT. OF REVENUE AND DISASTER MANAGEMENT GOVT. OF ASSAM OFFICE OF THE DIRECTOR OF LAND RECORDS AND SURVEYS RUPNAGAR GUWAHATI

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5:THE CHAIRMAN

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THE ASSAM LAND MANAGEMENT AND INFORMATION SOCIETY (ALMIS) A GOVT. OF ASSAM UNDERTAKING) OFFICE OF THE DIRECTOR OF LAND RECORDS AND SURVEYS RUPNAGAR GUWAHATI

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6:THE CHIEF EXECUTIVE OFFICER (CEO)

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THE ASSAM LAND MANAGEMENT AND INFORMATION SOCIETY(ALMIS) A GOVT. OF ASSAM UNDERTAKING OFFICE OF THE DIRECTOR OF LAND RECORDS AND SURVEYS RUPNAGAR GHY.

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7:M/S. J.K. COMMERCIAL A SOLE PROPRIETORSHIP FIRM REP. BY ITS SOLE PROPRIETOR JIBON KEOT S/O. SRI KESHOB KEOT R/O. FLAT NO. D-12 PRAGJYOTISH HOUSING COMPLEX GHORAMARA KHANKA ROAD P.S. HATIGAON GUWAHATI DIST. KAMRUP (M) ASSAM

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Advocate for the Petitioner : MR. J ROY Advocate for the Respondent : GA ASSAM

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BEFORE HONOURABLE MR. JUSTICE UJJAL BHUYAN

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ORDER

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Date : 07-03-2019

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This order will dispose of both WP(C) Nos. 6506 of 2017 and 1917 of 2018.

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Heard Mr K N Choudhury, learned Senior Counsel, assisted by Mr M Biswas, learned counsel for the petitioner in WP(C) No. 6506 of 2017 and Mr J Roy and Ms S Sarma, learned counsel for the petitioner in WP(C) No. 1917 of 2018. Also heard Mr R Borpujari, learned Standing Counsel for the Revenue Department as well as Finance Department, Government of Assam.

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WP(C) No. 6506 of 2017 has been preferred by M/s J K Commercial, a proprietorship concern assailing the legality and correctness of the letter dated 25.09.2017, issued by the Deputy Secretary to the Government of Assam, Finance (EC-II) Department and addressed to the Commissioner and Secretary to the Government of Assam, Revenue and Disaster Management Department, recommending that the procurement process be cancelled and a fresh tender be issued, which was communicated to the petitioner by the Chief Executive Officer, Assam Land Management and Information Society (Society) vide letter dated 21.10.2017.

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Matter relates to award of contract for the following work-“ Supply, Installation and Commissioning of IT Equipment (Computer Hardware and Software) with 5 years Onsite Comprehensive Annual Maintenance Contract for Circle Data Center and District Data Centre” , in connection with which notice inviting tender (NIT) was issued by the Society on 17.05.2017.

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4.1. This Court while issuing notice vide order dated 01.11.2017 had encapsulated the grievance of the petitioner in the following terms:-

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“ The tender No.DLR/LR-30/ALMIS/Pt-III/2017/15 dated 17.05.2017 (Annexure-1) was floated by the Assam Land Management and Information Society (ALMIS) for supply, installation and commissioning of IT equipment (computer hardware and software) with 5 years onsite comprehensive annual maintenance contract. Three responses were received, but the tenders of M/s BMG Informatics Pvt. Ltd. and M/s CMS IT Services were rejected on technical ground, leaving the

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petitioner as the only valid tenderer.

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The challenge here is to the communication dated 25.09.2017 (Annexure-8)of the Finance (EC-II) Department, whereby, the process is ordered to be cancelled and direction is issued for fresh tender as can be seen from the communication dated 21.10.2017 (Annexure-7), received by the petitioner.

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Mr. M. Biswas, the learned counsel submits that there is no infirmity with the tender process initiated earlier on 17.05.2017 (Annexure-1) and it is argued that the cancellation of the earlier process is at the instance of the M/s BMG Informatics Pvt. Ltd., whose tender was found to be technically non-responsive.

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In view of above, let Notice returnable in 3(three) weeks be issued. Mr.D. Nath, the learned Addl. Sr. Govt. advocate accepts notice for respondent Nos.1, 4, 5 and 6. The notice for respondent Nos.2 and 3 is received by Mr. B. Gogoi, the learned standing counsel Finance. Necessary extra copies be furnished to both the lawyers.

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In the meantime, fresh sale notice should not be issued without the leave of the Court, in pursuant to the impugned communication dated 21.10.2017 and 25.10.2017 (Annexures-7 and 8).” 4.2. Thus, as per order dated 01.11.2017, respondents were restrained from issuing fresh NIT without the leave of the Court.

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Since then, no leave of the Court has been sought for.

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Tenders submitted were subjected to technical evaluation on 01.07.2017. From the minutes of the meeting held on 01.07.2017, it is seen that three bidders had submitted tenders. One of the bidders namely, CMS had failed to submit no deviation certificate from the original equipment manufacturer (OEM). Therefore, the said bidder was disqualified. The remaining two bidders, namely, BMG Informatics Private Limited and M/s J K Commercial (petitioner) were held to be technically responsive. However, as per corrigendum dated 25.07.2017, issued by the Chief Executive Officer of the Society, technical evaluation committee re-scrutinized the technical bid documents of the two surviving bidders in terms of Central Vigilance Commission (CVC) guidelines dated 01.04.2014, whereafter, it was found that in respect of printers and scanners BMG had not submitted no deviation certificate as per prescribed format. Therefore, technical evaluation committee decided to disqualify BMG due to non-submission of no deviation certificate from original equipment manufacturer (OEM) in respect of printer and scanner and it was decided to hold financial evaluation on 27.07.2017.

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In the minutes of the financial evaluation committee meeting held on 27.07.2017, petitioner was

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declared as the qualified bidder. From the minutes, it is seen that there was difference of opinion amongst the members regarding decision taken by the technical evaluation committee to disqualify BMG. Chairman had referred the matter to the Finance (EC-II) Department. As per views of the Finance Department dated 29.08.2017, the sole responsive bidder should be awarded the contract. Accordingly, petitioner being the sole responsive bidder was declared as the qualified bidder.

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However, vide letter dated 21.10.2017, petitioner was informed by the Chief Executive Officer of the Society that the Chairman of the Society had directed to cancel the tender process in view of endorsement of the Finance (EC-II) Department dated 25.09.2017.

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8.1. Hence, the writ petition.

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Belatedly, BMG has filed WP(C) No. 1917 of 2018, assailing its disqualification by the subsequent corrigendum despite being found to be technically responsive at the time of technical evaluation on 01.07.2017.

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9.1. This Court by order dated 02.04.2018 took the view that petitioner (BMG) was able to make out a prima facie case to enter into the dispute, whereafter notice was issued. Relevant portion of the order dated 02.04.2018 is extracted hereunder:-

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“ The petitioners are aggrieved owing to rejection of their technical bid for nonmentioning of the “no deviation certificate” against the specifications item wise submitted in the tender. It is submitted by Mr. Roy that the items which are of similar manufacturers and bid of which are quoted by the petitioner are also quoted by the respondent No. 7. In the tender process, the petitioner has confirmed with respect to specification similar to the specification as informed by the manufacturer. Under such circumstances, the respondent No. 7 cannot issue another “no deviation certificate ”beyond the one issued by the manufacturer of items of similar manufacturer as that of items quoted by the petitioner. Mr. Roy also pointed out to the letter dated 25.09.2017 issued by the Secretary, Finance Department where there is recommendation from the Finance Department for cancellation of the current procurement and thereafter issuance of fresh tender, if necessary.

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Considering the submission of Mr. Roy and the materials on record in this writ petition, the petitioner has been able to make out a prima facie case to enter into the dispute raised herein this writ petition. Ms. Verma submits that the said letter dated 25.09.2017 and the contents therein are the outcome of the representation of the present petitioner. However, she sought for some time to take necessary instruction.

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Let notices be issued to the respondents.

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Ms. Verma, learned Standing Counsel, Finance Department accepts notices on behalf of the respondent Nos. 2 and 3 and Ms. Bhattacharjee accepts notice on behalf of the respondent No. 1.

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Extra copies of the petition be furnished to the learned counsels for the respondents.

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The petitioner shall take steps on the rest of the respondents by way of registered post with A/D within two days from today.

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Notice is made returnable on 11.5.2018.

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Considering the prima facie case of the petitioner and the satisfaction of this court, the status-quo with respect to the NIT dated 17.05.2017 be maintained as on date till the returnable date.”

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Submissions made by learned counsel for the parties have been considered. Also perused the materials on record.

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From the minutes of the technical evaluation committee meeting held on 01.07.2017, it is seen that out of the three participating bidders, one of them, namely, CMS was disqualified for not submitting no deviation certificate. The other two bidders were found to be technically responsive. The other two bidders are the two petitioners. Subsequently, by the corrigendum dated 25.07.2017, the second petitioner, i.e., BMG was disqualified on the ground that it had failed to submit no deviation certificate.

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11.1. A perusal of the corrigendum dated 25.07.2017 would go to show that technical evaluation committee had re-scrutinized the technical bid documents of the two parties on 25.07.2017 on an application submitted by JK on 04.07.2017, i.e., after the two parties were declared to be technically responsive on 01.07.2017. To re-scrutinize the technical bid documents of one of the bidders who was found to be technically responsive by the technical evaluation committee after closure of technical evaluation, that too, at the instance of one of the bidders to disqualify the other bidder so as to become the sole remaining responsive bidder was not justified. That apart, such re-scrutiny was done without any notice to the bidders and in the absence of the representatives of the bidders, that too, of the bidder who was ultimately disqualified through the re-scrutiny. Naturally, such disqualification post technical evaluation had created difference of opinion amongst the members of the technical evaluation committee. However, as per the minutes of the financial evaluation committee meeting held on 27.07.2017 on the basis of opinion rendered by the Finance Department, JK was declared to be the qualified bidder.

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Impugned letter dated 25.09.2017 discloses that Finance Department had taken note of the petition filed by JK to disqualify BMG and on that basis BMG was disqualified. Morever, Deputy Secretary to the Finance Department noted that there were significant inconsistencies in the process of procurement and, therefore, recommended that procurement be cancelled and a fresh tender be issued.

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From the letter dated 25.09.2017, it is further seen that BMG had submitted petition before the Finance Department seeking intervention in the matter.

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Thus, what transpires is that J K had intervened at the stage of technical evaluation to get BMG disqualified and after J K was declared to be the qualified bidder post financial evaluation, BMG had moved the Finance Department to intervene and based on such intervention, tender process has been cancelled.

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What is evident from the above is that both the parties had interfered with the tender process; firstly it was by J K to get BMG disqualified after it was found to be technically responsive and finally it was by BMG to get the tender cancelled itself after JK was declared to be the qualified bidder. In such circumstances, decision of the tendering authority to go for re-tender cannot be faulted. As a matter of fact, the authorities themselves are responsible for allowing the situation to reach this stage by permitting the bidders to intervene in the midst of the tendering process.

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In that view of the matter, Court is not inclined to intervene in the matter.

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Both the writ petitions are dismissed.

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JUDGE

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M/S. J.K.Commercial v. the State of Assam and 6 Ors.

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M/S. J.K.Commercial v. the State of Assam and 6 Ors.

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