Dismissed

M/S Veerabhadreshwara Traders v. the State of Karnataka

Karnataka HC13 Dec 2023WP/1421/2023

Case brief

AI extract

What is this about?

Petitioner challenged tender notifications quashed due to failure to complete evaluation within 90 days as per procurement rules. Court ordered return of earnest money to respondent and directed issuance of fresh tender for work previously awarded.

What did the court decide?

Earnest money returned to respondent-5 within four weeks; respondents permitted to issue fresh tender without delay.

M/S Veerabhadreshwara Traders Vs the State… — Public Procurement and Tenders | Karnataka HC (2023)

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NC: 2023:KHC:45260 WP No. 1421 of 2023

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 13^TH DAY OF DECEMBER, 2023

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BEFORE

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THE HON'BLE MR JUSTICE M.NAGAPRASANNA WRIT PETITION NO. 1421 OF 2023 (GM-TEN)

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BETWEEN:

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M/S VEERABHADRESHWARA TRADERS CHAMRAJPET, NEAR CANARA - SYNDICATE BANK, SORABA, SHIVAMOGGA DISTRICT-577 429 REPRESENTED BY ITS PROPRIETOR MR.DHARMAPPA R S/O SRI.RAMAPPA, AGED ABOUT 43 YEARS

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…PETITIONER

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(BY SRI. IRISHAD AHMED B M., ADVOCATE)

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AND:

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Digitally signed by PADMAVATHI B K Location: HIGH COURT OF KARNATAKA

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THE STATE OF KARNATAKA REP BY ITS SECRETARY, DEPARTMENT OF BACKWARD CLASSES WELFARE DEPARTMENT VIKAS SOUDHA, BANGALORE - 560 001

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THE DEPUTY COMMISSIONER CHITRADURGA - 577 501

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CHIEF EXECUTIVE OFFICER ZILLA PANCHAYAT, CHITRADURGA - 577 501

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THE DISTRICT OFFICER BACKWARD CLASSES WELFARE DEPARTMENT, CHITRADURGA - 577 501.

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KAPIL ENTERPRISES SURADDI HALLI

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NC: 2023:KHC:45260 WP No. 1421 of 2023

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JAGALUR TALUK DAVANAGERE DISTRICT - 577 528 REP. BY ITS PROPRIETOR VEENA G.S. (SHARANAPPA VEENA GANGAJJA)

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…RESPONDENTS

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(BY SRI. SPOORTHY HEGDE, HCGP FOR R1 TO R4; SRI. VYBHAV RAMESH, ADV. FOR R5)

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THIS WP IS FILED UNDER ARTILCE 226 OF THE CONSTITUTION OF INDIA PRAYING TO-QUASH THE IMPUGNED TENDER NOTIFICATION BEARING NO.DBCD/HOSADURGA/AA, SAA, TE / CR-42/2022-23 DTD 08.07.2022 ISSUED BY R4 VIDE ANNEXURE-A; QUASH THE IMPUGNED TENDER NOTIFICATION BEARING NO.DBCD/HOLALKERE / AA, SAA, TE / CR-43/202223 DTD 08.07.2022 ISSUED BY R4 VIDE ANNEXURE-B; QUASH THE IMPUGNED TENDER NOTIFICATION BEARING NO.DBCD/HIRIYURU / AA, SAA, TE / CR-44/2022-23 DTD 08.07.2022 ISSUED BY R4 VIDE ANNEXURE-C; QUASH THE IMPUGNED TENDER NOTIFICATION BEARING NO.DBCD/CHITRADURGA / AA, SAA, TE / CR-45/2022-23 DTD 08.07.2022 ISSUED BY R4 VIDE ANNEXURE-D; DIRECT THE RESPONDENTS TO INVITE FRESH TENDERS.

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THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, THE COURT MADE THE FOLLOWING:

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ORDER

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The petitioner is before this Court seeking the following

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prayer:

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" PRAYER

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WHEREFORE, the petitioner most respectfully prays that this Hon'ble Court be pleased to grant the following reliefs:-

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NC: 2023:KHC:45260 WP No. 1421 of 2023

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1. To issue a writ or order or direction in the nature of certiorari quashing the impugned tender Notification bearing No.DBCD/Hosadurga/Aa, Saa, Te/CR-42/2022-23, dated 08.07.2022 issued by 4^th respondents vide Annexure - A , in the interest of justice and equity.

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2. To issue a writ or order or direction in the nature of certiorari quashing the impugned tender Notification bearing No.DBCD/Holalkere / Aa, Saa. Te / CR-43/2022-23 dated 08.07.2022 issued by 4^th respondents vide Annexure-B , in the interest of justice and equity.

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3. To issue a writ or order or direction in the nature of certiorari quashing the impugned tender Notification bearing No.DBCD / Hiriyuru / Aa, Saa, Te / CR-44 / 2022-23 dated 08.07.2022 issued by 4^th respondents vide Annexure-C , in the interest of justice and equity.

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4. To issue a writ or order or direction in the nature of certiorari quashing the impugned tender Notification bearing No.DBCD / Chitradurga / As, Saa, Te / CR-45 / 2022-23, dated 08.07.2022 issued by 4^th respondents vide Annexure - D , in the interest of justice and equity.

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4 - NC: 2023:KHC:45260 WP No. 1421 of 2023

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5. To issue a writ or order or direction in the nature of mandamus directing the respondents to invite fresh tenders, in the interest of justice and equity.

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6. GRANT such other reliefs as this Hon'ble Court deems fit in the facts and circumstances of the case. "

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This Court has passed slew of orders. On 23.01.2023, the following order is passed:

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" ORDER

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Learned AGA to secure instructions and to make submissions with regard to clause (3) Rule 22 of the Karnataka Transparency in Public Procurements Rules 2000 by next date of hearing.

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Till such time, status quo shall be maintained by the respondents."

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On 17.04.2023 on the submissions of the

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impleading applicant, the following order is passed:

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NC: 2023:KHC:45260 WP No. 1421 of 2023

ORDER

Heard Sri. Padmanabha. V. Mahale learned Senior counsel appearing for the petitioner.

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The learned Senior counsel would urge a solitary contention that the issuance of work order is contrary to Rule 22 of the Karnataka Transparency in Public Procurements Rules, 2000. The Rule 22 reads as follows:

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" 22. Time taken for evaluation and extension of tender validity:-

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(1) The evaluation of tenders and award of contract shall be completed, as for as possible, within the period for which the tenders are held valid.

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(2) The Tender Accepting Authority shall seek extension of the validity of tenders from the tenderers for the completion of evaluation, if it is not completed within the validity period of tender.

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(3) In case the evaluation of tenders and award of contract is not completed within extended period, all the tenders shall be deemed to have become invalid and fresh tenders may be called for."

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In terms of Rule 22 a tender will have to evaluated and taken to its logical conclusion within 90days of issuance of the notification of tender. The admitted facts in the case at hand are that the notice inviting tender was issued on 08.07.2022 and the evaluation of the tender takes place on

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NC: 2023:KHC:45260 WP No. 1421 of 2023

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20.01.2023, which is admittedly after 90 days, contrary to the statutory prescription.

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The learned Senior counsel places reliance upon the judgment of a Co-ordinate Bench reported in 2003(6)Kar.L.J.243 interpreting Rule 22 of the rules and holding it to be the mandatory, the Coordinate Bench has held as follows:

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"12. Keeping this principle in mind if we look into Rule 22 it becomes clear that the said Rule provides for a time limit within which these tenders have to be evaluated and in the event of the same being not done within the stipulated period, provides for extension of time. The sub-rule (1) of Rule 22 categorically states that the evaluation of tenders and award of contract shall be completed, as far as possible, within the period for which the tenders are evaluated. Therefore, the completion of evaluation of tender within the period stipulated is the rule and only in exceptional cases, the period for evaluation may be extended. If within the stipulated period the tenders are not evaluated, sub-rule (2) of Rule 22 confers the power on the Tender Accepting Authority to seek extension for evaluation of tenders from the tenderers for the completion of evaluation. Therefore when this power is to be exercised as an exception, the said provision has to be construed strictly. Sub-rule (3) of rule 22 categorically provides that even if the evaluation of the tender is not made within the extended period, then no option is given to the Tender Accepting Authority and the Legislature has made its intention

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7 - NC: 2023:KHC:45260 WP No. 1421 of 2023

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clear by using the words that all the tenders shall be deemed to have become invalid and fresh tenders have to be called for. Therefore, once the Tender Accepting Authority does not evaluate tenders within the stipulated period or within the extended period, then that tender becomes invalid and no discretion is given to the said Authority except to call for fresh tenders. The whole object of Rule 22 appears to be to have these contracts executed and implemented within a time frame."

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The learned counsel appearing for the petitioner submits that the work order is issued to the impleading applicant, by antedating the said work order.

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The learned counsel representing the impleading applicant would contend that the petitioner is the beneficiary of an identical action and is enjoying the said benefit and sitting in the glass house is throwing stones at the impleading applicant. Therefore, the State would place on record all those works in terms of the subject tender notification, which have been evaluated after 90 days.

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List this matter on 20.04.2023 in the fresh matters list.

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Interim order granted earlier, is extended till the next date of hearing."

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8 - NC: 2023:KHC:45260 WP No. 1421 of 2023

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Now, the contention of the petitioner is, that the period of tender is itself over and therefore, nothing survives in the petition.

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Learned HCGP on instructions and verification of records would submit that the period of tender is already over and what remains is issuance of a fresh tender notification in which the petitioner and the respondents would be permitted to participate. The grievance of the successful tenderer is that he has paid the Earnest Money Deposit (EMD), as required under the tender and that should be returned along with the interest, as he has not enjoyed the fruits of the tender.

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The submission merits acceptance. In the light of the petition pending before this Court and an interim order operating and during the subsistence of the interim order, the tender itself coming to an end, the EMD that the successful tenderer had deposited shall be returned to respondent No.5, within four weeks from the date of receipt of copy of this order along with applicable rates of interest.

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NC: 2023:KHC:45260 WP No. 1421 of 2023

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The State is at liberty to issue a fresh tender

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notification for the work that the petitioner is performing for the last two years. The State shall not brook any delay or defeat competition by continuing the petitioner in the tender that he is enjoying for the last two years.

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With the aforesaid observations, the petition stands

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disposed.

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Sd/JUDGE

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KG List No.: 1 Sl No.: 20

M/S Veerabhadreshwara Traders v. the State of Karnataka

Case brief

What is this about?

What did the court decide?

M/S Veerabhadreshwara Traders v. the State of Karnataka

Case brief

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