Dismissed

Aneesh Appu v. State of Kerala

Kerala HC16 Sept 2020WA/1217/2020

Case brief

AI extract

What is this about?

The High Court of Kerala dismissed a writ appeal challenging an interim order in a tender dispute. The appellant sought to stay further proceedings as the selected respondent was allegedly ineligible for price preference. The Court held all factual issues required adjudication in the pending writ petition and refused interference, allowing further proceedings subject to that petition's outcome.

What did the court decide?

Writ appeal was dismissed; interim order in the writ petition was not set aside, and further proceedings remain subject to its result.

Aneesh Appu Vs State of Kerala — Public Procurement and Tenders | Kerala HC (2020)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR

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THE HONOURABLE MR. JUSTICE SHAJI P.CHALY

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WEDNESDAY, THE 16TH DAY OF SEPTEMBER 2020/25^TH BHADRA, 1942

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WA.No.1217 OF 2020

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AGAINST THE ORDER IN WP(C) 18643/2020(E) OF HIGH COURT OF KERALA DATED 11.9.2020

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APPELLANT/PETITIONER:

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ANEESH APPU, PWD CONTRACTOR AGED 30 YEARS, S/O. APPU, VELLAYIKUDATH HOUSE, VASUPURAM, MATTATHURKUNNU P.O., KODAKARA, THRISSUR DISTRICT- 680 684

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BY ADVS. SRI.LINDONS C.DAVIS SMT.E.U.DHANYA

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RESPONDENTS/RESPONDENTS:

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1 STATE OF KERALA REPRESENTED BY THE SECRETARY TO GOVERNMENT, POWER WORKS DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM – 695 001.

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2 CHIEF ENGINEER, OFFICE OF THE CHIEF ENGINEER, PWD-ROADS,THIRUVANANTHAPURAM.

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3 EXECUTIVE ENGINEER PUBLIC WORKS DEPARTMENT (ROADS & BRIDGES DIVISION) THRISSUR – 680 020

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W.A.1217/20

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4 ASSISTANT EXECUTIVIE ENGINEER, PUBLIC WORKS DEPARTMENT (ROADS & BRIDGES DIVISION) THRISSUR – 680 020 5 M/s. BITU TECH PANAVILLA JUNCTION, THYCAUD, THIRUVANANTHAPURAM – 695 014, REPRESENTED BY ITS DIRECTOR.

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R1-4 BY SRI. TEKCHAND SR.GOVERNMENT PLEADER

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THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 16.09.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

W.A.1217/20

JUDGMENT

Dated this the 16^th day of September, 2020

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S. Manikumar, CJ.

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Instant writ appeal is filed challenging the interim order passed in W.P(C). No.18643 of 2020 dated 11.9.2020. The impugned order reads thus:

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“Admit.

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Learned Government Pleader takes notice for respondents 1 to 4. Issue notice to 5^th respondent.

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Learned Government Pleader submits that selection notice have already been issued to 5^th respondent.

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Further proceedings would be subject to the result of

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the writ petition.

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Post immediately after notice is served.”

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The appellant is a PWD Contractor. The appellant has participated in Exhibit P1 re-tender for supply of ready made repair mix instant pothole filler for roads. The appellant has quoted 15.7% below the estimated rate. The 5^th respondent has quoted 7.5% below the estimated rate. Therefore, the appellant's rate which is the lowest, ought to have been accepted. But the official respondents, have selected the 5^th respondent, by providing 10% prize preference available for the local cottage industries.

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W.A.1217/20

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It is submitted that Exhibit P1 is a re-tender. The appellant has quoted the lowest rate in the original tender also. But original tender was cancelled, for the reason that the 5^th respondent was eligible for 5% preference available to local micro small and medium enterprises.

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After cancelling the original tender, Exhibit P1 re-tender was published. It is submitted that in Exhibit P1 re-tender also, the appellant's rate was the lowest for supply of ready made repair mix instant pothole filler for roads.

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For giving tender to the 5^th respondent, the 4^th respondent/Assistant Executive Engineer, PWD, Thrissur, has a contention that the 5^th respondent is eligible for 10% preference, which is only available to local cottage industries.

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It is submitted that the same is against Exhibit P5 judgment in W.P(C). No.12167 of 2020 dated 29.7.2020, where it is said that 5^th respondent is eligible for only 5% price preference for Micro Small and Medium Enterprises.

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It is further submitted that, if 5% price preference is given to the 5^th respondent, even then the appellant's rate is lowest. To overcome the same, Assistant Executive Engineer, PWD, Thrissur, the 4^th respondent has provided 10% price preference to 5^th respondent.

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Another contention raised in this appeal is that, it is evident from Exhibit P3 that, the Chief Engineer, PWD Thiruvananthapuram, 2^nd

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W.A.1217/20

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respondent has having extraneous consideration to the 5^th respondent, a private firm, and that a letter has been issued, by granting price preference. The said Exhibit P3 letter is unsustainable. In each tender, the 5^th respondent has to submit the records to show the nature of the firm and other records to prove that the concern is not making reasonable profit for getting benefit of the price preference. The appellant has challenged Exhibit P3 order as well as 10% price preference given to the 5^th respondent in the writ petition.

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Before the writ court, on instructions, the learned Government Pleader has submitted that the 5^th respondent has been selected by granting 10% price preference and that a selection notice was issued.

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It is the further contention of the appellant that, without considering the fact that, 5^th respondent is not a cottage industry eligible for 10% price preference, the learned single judge has issued an order that, further proceedings would be subject to the result of the writ petition. The said interim order would not fetch any result, as there is every chance to execute contract with the 5^th respondent. According to the appellant, the learned Single Judge ought have stayed further proceedings, for purchase from the 5^th respondent, as per Exhibit P1 retender.

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Aggrieved by the interim order in W.P(C). No.18643 of 2020 dated 11.9.2020, instant Writ Appeal is filed on the following grounds:

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W.A.1217/20

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A) The impugned interim order of the learned single Judge is unjust and illegal and therefore, to be set aside/modified and that further proceedings, in Exhibit.P1 retender notice ought to have been stayed.

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B) It is pertinent to note that the 5^th respondent is not a Cottage Industry and therefore, not eligible for 10% price preference. Even if it is taken for sake of argument that the 5^th respondent is a local Micro, small and Medium Enterprises (not admitted), then also the 5^th respondent is only eligible for 5% price preference. Even if 5% price preference is given to the 5^th respondent, the appellant's rate is much lower than the 5^th respondent's rate. Therefore, the contract ought to have been awarded to the appellant.

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The learned single Judge has not considered these issues and ordered that further proceedings would be subject to the result of writ petition. Such an order will not fetch any result as the supply contract may be executed within a short period.

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C) It is pertinent to note that the learned Government Pleader had no case to contend that 10% rate preference was given, on the ground that the 5^th respondent is a local Cottage Industry. There is absolutely no legal basis for granting the contract to the 5^th respondent with price preference of 10%. Hence, it is just and proper to stay the further proceedings for purchase from the 5^th respondent as per Exhibit P12 re-tender. If the purchase contract is executed with the 5^th respondent as per Exhibit P1 retender, then the appellant who had quoted the lowest rate would be rejected. Thus the same would cause irreparable loss and injury to the appellant. Therefore, the stay of further proceedings is inevitable in the case.

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W.A.1217/20

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D) Learned Single Judge has failed to consider that, by giving 10% price preference, the loss is incurred to the public exchequer, for giving an illegal benefit to the 5^th respondent, a private firm. At the same time, the appellant who has quoted lowest rate for supply of products would be arbitrarily denied to his entitlement. If the contract is executed for supply, that cannot be revoked or remedied. Therefore, there is balance of convenience is to stay the further proceedings. Hence, this Honourable Court may be pleased to set aside the impugned interim order and stay further proceedings for purchase from the 5^th respondent as per Exhibit P1 retender notice.

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E) The appellant has not given any notice regarding the rejection of his bid pursuant to Exhibit P1 retender notice. The appellant was not aware about the selection notice issued to the 5th respondent.

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F) The appellant has also raised a contention that the 5^th respondent is not even eligible to get 5% price preference. But the writ court has failed to consider the same.

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As per Caluse.9.26 of Stores Purchase Manual, 2013 where a Micro Small and Medium Enterprise is making reasonable profit, the price preference is not applicable. The reasonable profit is that, to declare dividend of at least 5% to its shareholders. The 5^th respondent has to give appropriate documents to show that the firm is not making reasonable profit, ie above 5% dividend. For that reason also the 5^th respondent is not eligible for any price preference.

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Though Mr. Lindons C. Davis, learned counsel for the

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appellant made contentions on the above grounds and sought for

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W.A.1217/20

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intervention of the impugned order, we are not inclined to interfere with the same for the reason that all the contentions have to be adjudged in the writ petition. Thus, while admitting the writ petition, the writ court has ordered that further proceedings would be subject to the results of the writ petition. Apprehension of the writ petitioner that if the agreement is executed, then the writ petition would become infructuous, is not well founded for the reason that, if ultimately the writ court finds that the selection of the 5^th respondent is erroneous, then appropriate orders would be passed. It is always open to the petitioner to seek for expeditious hearing of the writ petition. In view of the above, we are not inclined to interfere with the interim order. Writ Appeal is dismissed.

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Sd/S. Manikumar, Chief Justice

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Sd/Shaji P. Chaly, Judge

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sou.

Aneesh Appu v. State of Kerala

Case brief

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Aneesh Appu v. State of Kerala

Case brief

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