Partly allowed

Vijay Electricals Ltd. v. The Bihar State Power holding Co. Ltd. Patna and Ors.

Patna HC16 May 2013CWJC/9448/2013

Case brief

AI extract

What is this about?

Rural electrification bidders challenged tender cancellation and retendering. Five petitions succeeded despite withdrawal of earnest money, delay and initial nondisclosure. Cancellation and fresh tenders for five districts were quashed, conditional on redeposit within two weeks. The Nalanda petition was dismissed because its bidder was not lowest in Part-A.

What did the court decide?

Tender cancellation and fresh notices for Patna, Gaya, Rohtas, Araria and Siwan quashed, subject to redeposit of withdrawn EMD within two weeks; respondents to proceed according to law.

Vijay Electricals Ltd. Vs The Bihar State Power… — Public Procurement and Tenders | Patna HC (2013)

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IN THE HIGH COURT OF JUDICATURE AT PATNA

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Civil Writ Jurisdiction Case No.9301 of 2013

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M/S SPML Infra Ltd. (formerly known as Subhash Project and Marketing Ltd.), a Company incorporated under the provisions of Companies Act, 1956 having its registered Office at F-27/2, Okhla Industrial Area, Phase-II, New Delhi - 110020 through its Vice President Shri Malay Kanti Chakraborti, S/O Late N.R. Chakraborti, Residing at 296 Purbalok, Kolkata-99

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.... .... Petitioner/s

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Versus

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The Union Of India, Ministry Of Power, through the Secretary Government Of India, Shastri Bhawan, New Delhi

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The Rural Electrification Corporation Limited, a Government Of India Enterprises having its Corporate Office at Core-4, Scope Complex, 7, Lodi Road, New Delhi Having Its Zonal Office at Block-C, 4th Floor, Maurya Lok Complex, New Dak Bungalow Road, Patna-800001

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The Bihar State Power (Holding) Co. Ltd. the Erstwhile Bihar State Electricity Board Through Its Managing Director

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The Chairman Cum Managing Director Bihar State Power (Holding) Co. Ltd., Vidhyut Bhawan, Bailey Road, Patna

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The Chief Engineer, Rural Electrification Bihar State Power (Holding) Co. Ltd., Vidhyut Bhawan, Bailey Road, Patna

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.... .... Respondent/s

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with

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Civil Writ Jurisdiction Case No.9302 of 2013

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M/S SPML Infra Ltd. (formerly known as Subhash Project and Marketing Ltd.), a Company incorporated under the provisions of Companies Act, 1956 having its Registered Office at F-27/2, Okhla Industrial Area, Phase-Ii, New Delhi - 110020 through its Vice President Shri Malay Kanti Chakraborti, S/O Late N.R. Chakraborti, Residing at 296

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Purbalok, Kolkata-99

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.... .... Petitioner/s

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Versus

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The Union Of India, Ministry Of Power, through the Secretary Government Of India, Shastri Bhawan, New Delhi

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The Rural Electrification Corporation Limited, a Government Of India Enterprises having its Corporate Office at Core-4, Scope Complex, 7, Lodi Road, New Delhi having its Zonal Office at Block-C, 4th Floor, Maurya Lok Complex, New Dak Bungalow Road, Patna-800001

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The Bihr State Power (Holding) Co. Ltd. The Erstwhile Bihar State Electricity Board through its Managing Director

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The Chairman Cum Managing Director Bihar State Power(Holding) Co. Ltd., Vidhyut Bhawan, Bailey Road, Patna

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The Chief Engineer, Rural Electrification Bihar State Power (Holding) Co. Ltd., Vidhyut Bhawan, Bailey Road, Patna

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.... .... Respondent/s

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with

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Civil Writ Jurisdiction Case No.9304 of 2013

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M/S ECI Engineering and Construction Company Ltd., a Company Incorporated under the provisions of Companies Act, 1956 having its registered office at Panchwati Township, Plot No. A-12 And 13, Manikonda, Rajendranagar Mandal, Rr District, Hyderabad through its Project Coordinator Sri Manoj Kumar Srivastava S/O Late J.P. Srivastava, Residing At Sri Krishna Puri, P.S.- Sri Krishna Puri, Patna, Bihar

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.... .... Petitioner/s

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Versus

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The Union Of India, Mnistry Of Power, through the Secretary Government Of India, Shastri Bhawan, New Delhi

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The Rural Electrification Corporation Limited, a Government Of India Enterprises having its Corporate Office at Core-4, Scope Complex, 7,

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Lodi Road, New Delhi and its Zonal Office At Block-C, 4th Floor, Maurya Lok Complex, New Dak Bungalow Road, Patna-800001

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The Bhar State Power (Holding) Co. Ltd. The Erstwhile Bihar State Electricity Board Through Its Managing Director

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The Chairman Cum Managing Director Bihar State Power (Holding) Co. Ltd., Vidhyut Bhawan, Bailey Road, Patna

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The Chief Engineer, Rural Electrification Bihar State Power (Holding) Co. Ltd., Vidhyut Bhawan, Bailey Road, Patna

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.... .... Respondent/s

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with

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Civil Writ Jurisdiction Case No.9326 of 2013

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M/S SMS Infrastructure Ltd. a Company incorporated under the Provisions of Companies Act, 1956 Having Its Registered Office at 267, Ganesh Phadnavis Bhawan, Near Triangular Park, Dharampeth, Nagpur- 10 Through Its Assistant Manager Shri Sameer Ahmad And S/O Shri Shabbeer Ahamd Residing At V 601, Warispura, Kamptee, Nagpur- 441002.

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.... .... Petitioner/s

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Versus

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The Union of India, Ministry of Power, through the Secretary, Government of India, Shastri Bhawan, New Delhi.

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The Rural Electrification Corporation Limited A Government Of India Enterprised, Having Its Corporate Office At Core- 4, Scope Complex7, Lodi Road, New Delhi And Its Zonal Office At Block- C, 4th Floor, Maurya Cok Complex, New Dak Bungalow Road, Patna- 800001.

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The Bihar State Power (Holding) Co. Ltd., the Erstwhile Bihar State Electricity Board through its Managing Director.

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The Chairman Cum Managing Director, Bihar State Power (Holding) Co. Ltd., Vidhyut Bhawan, Bailey Road, Patna.

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The Chief Engineer, Rural Electrification, Bihar State Power (Holding) Co. Ltd., Vidhyut Bhawan, Bailey Road, Patna.

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.... .... Respondent/s

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with

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Civil Writ Jurisdiction Case No.9448 of 2013

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====================================================== 1. Vijay Electricals Limited, a Company registered under the Companies Act, 1956, having its registered Office at 6-3-648/1 And 2, Off Raj Bhawan Road, Somajiguda, Hyderabad 500082, through its authorized signatory namely Lakshman Ojha Son Of Late Yogendra Ojha, Presently Residing at 101, Shivaprasth Apartment, Road No. 0, Near Gandhi Maidan, East Patel Nagar, P.S. Shastri Nagar, Dist. Patna

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.... .... Petitioner/s

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Versus

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The Bihar State Power (Holding) Co. Ltd. Patna, Erstwhile Bihar State Electricity Board, Through Its Chairman-Cum-Managing Director, Vidyut Bhawan, Jawaharlal Nehru Marg, Patna- 1

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Chairman-Cum-Managing Director, The Bihar State Power (Holding) Co. Ltd., Patna, Vidyut Bhawan, Jawaharlal Nehru Marg, Patna- 1

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Chief Engineer (Re), The Bihar State Power (Holding) Co. Ltd., Patna Vidyut Bhawan, Jawaharlal Nehru Marg, Patna- 1

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The Union Of India, Ministry Of Power, Through Its Secretary, Govt. Of India, Shastri Bhawan, New Delhi

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The Rural Electrification Corporation Limited, A Government Of India Enterprises, Having Its Corporate Office At Core- 4, Scope Complex, 7, Lodi Road, New Delhi And Its Zonal Office At Block- C, 4th Floor, Maurya Lok Complex, New Dak Bunglow Road, Patna- 800001

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.... .... Respondent/s

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with

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Civil Writ Jurisdiction Case No.9617 of 2013

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M/S GKC-SSELJV, A Joint Venture Between GKC Projects Ltd. With SSE Limited, the Companies incorporated under the provisions of

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Companies Act, 1956 Having The Office Of Lead Bidder At Sy. No. 9 (P), CII Green Building Lane, HITEC City, Kondapur, Hyderabad - 500084 Through Its General Manager - Projects, T. Picheswar Rao, S/O T. Venkatratnam, Resident Of MIG -A- 139, Dr. A.S. Rao Nagar, Kapra, P.S. Kushaiguda, Hyderabad

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.... .... Petitioner/s

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Versus

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The Bihar State Power ( Holding) Co. Ltd., The Erstwhile Bihar State Electricity Board Through Its Managing Director

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The Chairman Cum Managing Director, Bihar State Power (Holding) Co. Ltd., Vidhyut Bhawan, Bailey Road, Patna

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The Chief Engineer, Rural Electrification, Bihar State Power (Holding) Co. Ltd. Vidhyut Bhawan, Bailey Road, Patna

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The Union Of India, Ministry Of Power, Through The Secretary, Government Of India, Shastri Bhawan, New Delhi

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The Rural Electrification Corporation Limited, A Government Of India Enterprises, Having Its Corporate Office at Core-4, Scope Complex, 7, Lodi Road, New Delhi and Its Zonal Office at Block - C, 4th Floor, Maurya Lok Complex, New Dak Bunglow Road, Patna - 800001

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.... .... Respondent/s ====================================================== Appearance : (In CWJC No.9301 of 2013) For the Petitioner/s : Mr. Y.V.Giri, Sr. Advocate Mr. Ashish Giri, Advocate For the BSPHCL : Mr. Anand Kumar Ojha, Advocate (In CWJC No.9302 of 2013) For the Petitioner/s : Mr. Y.V.Giri, Sr. Advocate Mr. Ashish Giri, Advocate For the BSPHCL : Mr. Anand Kumar Ojha, Advocate (In CWJC No.9304 of 2013) For the Petitioner/s : Mr. Y.V.Giri, Sr. Advocate Mr. Ashish Giri, Advocate

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For the BSPHCL : Mr. Anand Kumar Ojha, Advocate (In CWJC No.9326 of 2013) For the Petitioner/s : Mr. Y.V.Giri, Sr. Advocate Mr. Ashish Giri, Advocate For the BSPHCL : Mr. Anand Kumar Ojha, Advocate (In CWJC No.9448 of 2013) For the Petitioner/s : Mr. Prabhat Ranjan Singh, Advocate For the Respondent/s : Mr. Anand Kumar Ojha, Advocate (In CWJC No.9617 of 2013) For the Petitioner/s : Mr. S.D.Sanjay & Mr. Gautam Kumar Kejriwal, Advocates For the BSPHCL : Mr. Anand Kumar Ojha, Advocate ====================================================== CORAM: HONOURABLE MR. JUSTICE RAMESH KUMAR DATTA ORAL ORDER

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3 16-05-2013 Heard learned counsels for the petitioners in all the writ applications and learned counsels for the respondentBihar State Power (Holding) Company Limited and the intervenor.

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The present writ applications are a sequel to a judgment and order dated 26.4.2013 of this Court in CWJC No. 6293/2013 (M/s. Technofab Engineering Ltd. Vs. The Bihar State Power (Holding) Company Limited and Ors.) along with three analogous cases by which this Court had held that the cancellation of the earlier tender process by the Board of Directors of the Power Holding Company dated 8.3.2013 is not

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justified. The said order and its consequential orders in so far as they related to Banka, Bhojpur, Nawadah and Purnea were quashed.

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The present petitioners had also participated pursuant to the same tender notice which was issued for 11 districts claiming that like the four writ petitioners earlier they should also be conferred the said benefits as their cases stand on similar footing and therefore, similar directions should be issued in their favour with respect to the Patna, Gaya, Rohtas, Nalanda, Araria and Siwan districts.

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The stand of the petitioners to be conferred the same benefit has been vehemently opposed by learned counsel for the Bihar State Power (Holding) Company Limited stating that by their various actions, the petitioners have disentitled themselves to the grant of similar relief as the petitioners of the earlier four cases and it is not correct to say that the cases of these petitioners stand on similar footing to that of the earlier petitioners.

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Since the facts of the case have been stated in detail in the order of CWJC No. 6293/2013, only a brief reference may be made to them in this order. The Bihar State Electricity Board, since reconstituted as the Bihar State Power (Holding) Company

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Limited (BSPHCL), published an NIT in different newspapers on 10.7.2012 for rural electrification work in 11 districts of Bihar. For each district the Tender Specification laid down details for Part-A and Part-B of the tender. The Part-A portion work was to be done under the RGGVY which had been floated by the Central Government and for the same, funds were to be provided through the nodal agency, the Rural Electrification Corporation; Part-B of the work related to the funds to be provided by the State Government. The Tender Specifications clearly laid down the separate works to be done for both Part-A and Part-B, separate accounts had to be maintained and separate payments were to be made. All the petitioners were the lowest tenderers respectively in the six districts above mentioned. All the tenderers were also the lowest tenderers in Part-A of the tender, except in the district of Nalanda where the petitioner in CWJC No. 9326/2013 M/s. SMS Infrastructure Limited was the L-2 bidder of Part-A. The Central Purchase Committee of the respondent-Board recommended the award of the contract to these petitioners as also others in their respective districts. However, the Board of Directors of the Power Holding Company by its resolution dated 8.3.2013 cancelled the tender for all the 11 districts holding that in the context of complexity

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involved for complying with REC’s letter dated 19.2.2013 and the difficulties arising due to non-availability of fund for the State component included in the tender, it was resolved to cancel the tender and float a fresh tender for RGGVY component.

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Aggrieved by the same four L-1 tenderers in Banka, Bhojpur, Nawadah and Purnea districts approached this Court by filing CWJC No. 6293/2013 and three other writ petitions. This Court by its order dated 26.4.2013 held that Part-A and Part-B portion having been kept separate in all respects right from the Tender Specifications till the finalization of the tender, the reliance by the Board of Directors on the letter dated 19.2.2013 of the REC was not justified for not allotting the tender for PartA portion to the successful L-1 tenderers who were also the L-1 tenderers in Part-A and separate work orders could have been easily issued for Part-A portions and Part-B portions as required by the REC letter dated 19.2.2013. It was thus held that the submissions made on behalf of the respondent-Board that more persons would become eligible if fresh tender is held is an afterthought as the same was not in contemplation of the Board of Directors when it annulled the earlier tender process. It was further held that non-availability of fund for the State Component also does not greatly affect the tender since Part-A

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and Part-B component of the tender were kept separate in all respects during the tender process and only for the award of tender the same had to be considered jointly. This Court has considered the action of the Board of Directors as against the public interest as the floating of an identical tender as Part-A portion after more than eight months of the previous tender, on account of inflation may result in higher bids.

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This Court was also of the view that the said action of the respondents upon opening the financial bid of the said petitioners shall cause serious injustice upon them as the details of the entire bidding process of the tenders of those petitioners had become open for every one and thus the sanctity of the tender process was destroyed by going for a fresh bidding on exactly the same terms and conditions without any variation and without any justifiable reason for the same. Accordingly, it was held that the respondent-Power Holding Company had been unable to justify its action as not being arbitrary and unreasonable and thus cancellation of the earlier tender process for the districts of Banka, Bhojpur, Nawadah and Purnea and the decision of the Board of Directors dated 8.3.2013 and consequential orders with respect to the said districts as also the fresh tender notice in relation to those districts were quashed.

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After the aforesaid decision was rendered, the present petitioners have approached this Court.

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Learned counsel for the respondent-Board submits that four of the petitioners for the districts of Patna, Gaya, Araria and Siwan had asked for and received back their earnest money deposits on various dates and thus the effect of the same was that they had withdrawn their offer which did not stand at all. In the said circumstances, the writ applications on their part are not maintainable.

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Learned counsel has also referred to the inaction of the petitioners in the matter that they have passively accepted the cancellation of the previous tender process by the respondentCompany as also the re-tender of Part-A portion of the previous tender which was done as early as on 26.3.2013, and thereafter chose to withdraw their EMD and did not approach the Board showing any grievance against the action of the Board in the matter.

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It is urged that filing of the writ petitions by the petitioners after the order dated 26.4.2013 of this Court in favour of the four petitioners of the four districts, cannot give them any right in such circumstances to challenge the actions of the Board. It is submitted by learned counsel that the action of

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the petitioners amounts to waiver, intentional relinquishment and abandonment of their existing rights by the petitioners and thus they should not be permitted to challenge the action of the Board in the present writ applications.

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Learned counsel for the respondent-Power Holding Company further states that this Court had considered the fact that the Part-A component of the tender in the case of the earlier writ petitioners was from a high of 86.66% to a low of 74.40%, of the entire tender whereas in the present matter, except for Gaya district where the RGGVY component and Part-A of the previous tender was 80.54%, in the remaining three districts the said component is less than the earlier lowest,, i.e., in Siwan 73%, Nalanda 71.5%, Patna 70.21%, Rohtas 67.32% and Araria 65.39%. For the said reason also, learned counsel submits that the petitioners cannot claim parity with the earlier writ petitioners.

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Learned counsel submits that the petitioners have also suppressed the fact of having withdrawn the EMD except in the case of Araria, while approaching this Court by filing the writ applications and only when the said fact was pointed out by him in the Court then supplementary affidavits were filed stating the said facts and thus on the said ground the writ applications of

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these petitioners should be dismissed as having not come to this Court with clean hands.

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Learned counsel also points out that the petitioners of Rohtas and Nalanda districts have also participated in the second bid process whereas the petitioner of Siwan district had filed his EMD and Bank guarantee but subsequently on failure to upload his bid documents, has asked for return of the same.

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Learned counsel for the Power Holding Company contends that so far as the petitioner of Nalanda district is concerned, it was not an L-1 tenderer in the previous tender process so far as Part-A of the tender is concerned and thus it is not entitled to the benefit of the said decision of this Court which was clearly based on the proposition that L-1 tenderer for the entire tender should also be L-1 tenderer in Part-A.

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In support of his aforesaid propositions learned counsel relies upon a decision of the Supreme Court in the case of Tamil Nadu Housing Board, Chennai Vs. M.Meiyappan & Ors: 2010 AIR SCW 7130, .in paras 14 and 18 of which it has been held was follows:

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“ 14. At the outset, we must state that on the facts of this case, the High Court was not

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justified in entertaining the writ petition. In our opinion, the writ petition must fail on the short ground that the writ petition had been filed 16 years after the award was announced by the Collector. It is trite law that delay and laches is one of the important factors which the High Court must bear in mind while exercising discretionary power under Article 226 of the Constitution. If there is such negligence or omission on the part of the petitioner to assert his right which, taken in conjunction with the lapse of time and other circumstances, causes prejudice to the opposite party, the High Court must refuse to invoke its extraordinary jurisdiction and grant relief to the writ petitioner.” “18. Similarly, in Tridip Kumar Dingal & Ors. V. State of West Bengal & Ors. (2009) 1 SCC 768: (AIR 2008 SC (Supp) 824) (to which one of us (D.K.Jain, J.) was a party), this Court had observed as under:

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“56. We are unable to uphold the

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contention. It is no doubt true that there can be no waiver of fundamental right. But while exercising discretionary jurisdiction under Articles 32,226,227 or 136 of the Constitution, this Court takes into account certain factors and one of such considerations is delay and laches on the part of the applicant in approaching a writ court. It is well settled that power to issue a writ is discretionary. One of the grounds for refusing reliefs under Article 32 or 226 of the Constitution is that the petitioner is guilty of delay and laches.

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If the petitioner wants to invoke jurisdiction of a writ court, he should come to the Court at the earliest reasonably possible opportunity. Inordinate delay in making the motion for a writ will indeed be a good ground for refusing to exercise such discretionary jurisdiction. The underlying object of this principle is not to encourage agitation of stale

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claims and exhume matters which have already been disposed of or settled or where the rights of third parties have accrued in the meantime” (See also: P.S. Sadasivaswamy V. State of Tamil Nadu: (1975) 1 SCC 152: (AIR 1974 SC 2271).”

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Learned counsel also relies upon a decision of the Apex Court in the case of M/s. Prestige Lights Vs. State Bank of India : 2007 AIR SCW 5350, in paras 32 and 34 of which it has been held as follows:

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“32. It is thus clear that though the appellantCompany had approached the High Court under Article 226 of the Constitution, it had not candidly stated all the facts to the Court. The High Court is exercising discretionary and extraordinary jurisdiction under Article 226 of the Constitution. Over and above, a Court of Law is also a Court of Equity. It is, therefore, of utmost necessity that when a party approaches a High Court, he must place all the

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facts before the Court without any reservation. If there is suppression of material facts on the part of the applicant or twisted facts have been placed before the Court, the Writ Court may refuse to entertain the petition and dismiss it without entering into merits of the matter. 34. It is well settled that a prerogative remedy is not a matter of course. In exercising extraordinary power, therefore, a Writ Court will indeed bear in mind the conduct of the party who is invoking such jurisdiction. If the applicant does not disclose full facts or suppresses relevant materials or is otherwise guilty of misleading the Court, the Court may dismiss the action without adjudicating the matter. The rule has been evolved in larger public interest to deter unscrupulous litigants from abusing the process of Court by deceiving it. The very basis of the writ jurisdiction rests in disclosure of true, complete and correct facts. If the material facts are not candidly stated or are suppressed or are distorted, the

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very functioning of the writ courts would become impossible.”

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On the issue of withdrawal of EMD, learned counsel cites a Division Bench judgment of the Andhra Pradesh High Court in the case of Syed Moosa Quadri Vs. State of Andhra Pradesh & Ors.: AIR 1980 Andhra Pradesh 236, in paras 12 and 13 of which it has been held as follows:

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“12. During the course of argument, we called for the file relating to the tender submitted by the 3^rd respondent. On a perusal of the file, we find that an endorsement was made on the reverse of the first page of the tender form on 20.4.1978 by the 3^rd respondent, which is to the following effect.

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“Received back the DD No. 4795960161 dated 4.3.1977 for Rs. 10,000/- and B.G. for Rs. 80,000/- from Syndicate Bank, New Nallakunta, Hyderabad.

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Sd. R.S.Rangadas 20.4.1978.”

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This endorsement shows that the 3^rd respondent had withdrawn on 20.4.1978 the

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cash of Rs. 10,000/- and Bank Guarantee for Rs. 80,000/- which he had paid as earnest money. This fact that the 3^rd respondent had withdrawn that cash deposit and the Bank Guarantee on 20.4.1978 does not appear to have been brought to the notice of the Government by the Corporation nor does it appear to have been brought to the notice of our learned brother when the writ petition was being heard. When this endorsement was brought to the notice of Sri S.Sri Krishna, the learned counsel for the 3^rd respondent, he had fairly conceded that the endorsement indicates that the 3^rd respondent had accepted the rejection of the tender and withdrew the earnest money. If so, it follows that the Corporation could not have validly revived the tender of the 3^rd respondent. It is regrettable that a crucial, relevant and material fact that the 3^rd respondent had withdrawn the earnest money deposit and the Bank guarantee on 20.4.1978 was not brought to the notice of the Government. In view of the

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withdrawal of the cash deposit and the Bank guarantee by the 3^rd respondent on 20.4.1978, fresh tenders were called on 20.4.1978.” “13. It is only on 4.5.1978 that the 3^rd respondent made a representation to the Minister for Municipal Administration for consideration of his tender suppressing the fact that he had already withdrawn the cash deposit and Bank Guarantee. The Government could not have therefore validly passed an order advising the Corporation to consider or accept the tender of the 3^rd respondent as the tender was no longer subsisting by the date the petitioner made a representation to the Minister or by the date of passing of the impugned order. Even the Corporation could not have accepted the tender of the 3^rd respondent when he had already withdrawn the earnest money paid by way of cash and Bank Guarantee. The action of the Corporation is, therefore, illegal and devoid of jurisdiction.”

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For the same proposition, learned counsel also places

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reliance on a decision of a learned Single Judge of this Court in the case of Steel Authority of India Limited Vs. Raj Kumar & Bros. & another: : (1995) 2 BLJR 917, Para-6 of which is quoted below.

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“6. Let us take this proposition as correct for the sake of argument as I am going to pass the order of different angle. Admitting this position to the effect that the earnest money was withdrawn by the defendant is admitted, the application for release as contained in Annexure-3 dated 8.9.1992 does not reveal any clause to the effect that the withdrawal would be under protest. The letter dated 4.9.1992 issued by the defendant addressed to the Deputy General Manager of the plaintiff shows that he was agreeable to withdraw the earnest money as he was given the assurance of giving him similar work immediately by the plaintiff but no reference is there of the letter dated 4.9.1992 in the withdrawal letter dated 8.9.1992 vide Annexure-3. It is the contention of Mr. Banerjee that this letter dated 4.9.1992

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is only a connected one, but it appears from the impugned judgment that the learned court below on the evidence of the plaintiff side has accepted that letter dated 4.9.1992 was within the knowledge of the plaintiff. The letter dated 12.9.1992 is in the form of protest that he had withdrawn the earnest money on the assurance of giving a similar contract but when the same has not been given, his withdrawal must be considered as under protest, but this subsequent letter dated 12.9.1992 shall have no bearing as the withdrawal was made before hand on 8.9.1992. For the sake of argument, if it is admitted that the withdrawal of earnest money was money on assurance on giving a similar contract to the defendant then also the fact remains that the withdrawal of earnest money had completed the chapter of previous contract in question and if no second work is given to the defendant, then for that purpose, he might have grievance for the subsequent contract but by that alone, he cannot reopen the previous

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contract which was factually closed on withdrawal of earnest money. The remedy for any compensation or damages shall lie to the defendant by way of civil suit and not by invoking arbitration clause of the previous contract which was closed on withdrawal of earnest money. The assurance of another contract can in no case reopen the previous contract.”

¶169

In CWJC No. 9617/2013 which relates to the district of Siwan, I.A. No. 3631/2013 was filed by East India Udyog Limited for being permitted to intervene in the matter and oppose the writ application claiming to be an applicant in the fresh tender notice dated 26.3.2013 and therefore likely to be adversely affected if the writ application is allowed. The applicant has been permitted to intervene by this Court.

¶170

Learned counsel for the intervener has adopted the submissions of learned counsel for the Power Holding Company.

¶171

Learned counsels for the petitioners, on the other hand, submit that none of the submissions of learned counsel for

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the respondent-Power Holding Company are sufficient to deprive the petitioners of the benefits of the law declared by this Court by its order dated 26.4.2013 in identical matters. It is urged by learned counsels that the cases of the present petitioners are identical to that of the petitioners in the earlier four writ petitions and thus, this Court ought not to deprive them of the benefits which have been conferred upon the earlier petitioners.

¶175

It is the stand of learned counsels for the petitioners that the withdrawal of EMD by the petitioners in four of these cases was not unilateral act on their part, rather it was a consequential act upon cancellation of the previous tender process by the respondents; the respondents thus having contributed to the withdrawal of the EMD by the petitioners, it does not lie in their mouth to take the stand that merely by withdrawal of EMD the petitioners have become disentitled to the same benefit in identical situation as the others.

¶176

As a matter of fact, it is the stand of learned counsels that the respondent-BSPHCL itself should have shown good grace in the matter and accepted the law laid down by this Court and put a stop on the re-tender process and granted the same benefit to the present petitioners as was granted to the petitioners

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of the four writ petitions by this Court but they have not chosen to do so and acted to increase the litigation, contrary to litigation policy of the State Government which is binding upon the Public Sector Undertakings of the State Government.

¶180

Learned counsels also submits that there can be no waiver of fundamental right under Article 14 of the Constitution as repeatedly laid down by the Apex Court and this Court in various decisions and the mere withdrawal of EMD by the petitioners cannot be treated as waiver of their fundamental rights by them.

¶181

Learned counsel also submits that there was no delay on the part of the petitioners in approaching this Court as immediately after the decision was rendered on 26.4.2013 they have approached this Court even before any 3rd party right could arise, since the last date of filing of the tender was 2.5.2013 and the tender was to be opened on 3.5.2013 whereas most of the petitioners had approached this Court earlier and the first few writ petitions were filed on 29.4.2013 itself and others also followed up immediately thereafter before any 3rd party right could arise and this Court also granted them interim protection in the matter except in the case of Nalanda district where no interim order has been passed.

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¶184

It is also contended by learned counsels that the whole object of taking of earnest money deposit in a tender process is to protect the tender issuing authority from any loss or damage on account of the action of any non-serious tenderers and in the present matter since the Board itself had cancelled the tender hence the withdrawal of the EMD by them had not caused any injury to the Board.

¶185

It is also the contention of learned counsels for the petitioners that the eligibility of the petitioners in the previous tender did not come to an end merely on account of withdrawal of the EMD by them pursuant to the cancellation of the tender process. It is submitted that when the Board itself had gone back on a tender process started by it and cancelled the same why should the petitioners be made to suffer any loss merely because of withdrawal of EMD.

¶186

Learned counsels also submit that this Court in the earlier decision has held that the action of the respondent-Board was against the public interest and once the wider issue of public interest is involved in the matter, then the action of the Board contrary to such public interest should not be countenanced and the petitioners should also be given the benefit of their being the L-1 tenderers in the previous bidding process. It is urged that so

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far as the public interest aspect is concerned, there can be no question of applying the principle of waiver and delay on the part of the petitioners to the said issue of public interest.

¶190

Learned counsels for the petitioners have also relied, amongst others, on certain decisions in support of their stand. On the question of waiver of fundamental rights under Article 14 of the Constitution, learned counsels rely upon a decision of a Constitution Bench of the Supreme Court in the case of Basheshar Nath Vs. Commissioner of Income-tax, Delhi and Rajasthan and another : AIR 1959 SC 149, in para-15 of which it has been held as follows:

¶191

“15. The learned Attorney General has relied on various passages in textbooks written by well-known and eminent writers, e. g., Cooley, Willoughby, Willis and Rottschaefer and on eight American decisions. In considering the statements of law made by American writers and judges the following observations of Patanjali Sastri C. J. in State of TravancoreCochin v. Bombay Co. Ltd., 1952 S C R ll12 at pp. l120, l121 : (A.I.R 1952 S C 366 at p. 368) should constantly be borne in mind :

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"These clauses are widely different in language, scope and purpose, and a varying body of doctrines and tests have grown around them interpreting, extending or restricting, from time to time, their operation and application in the context of the expanding American commerce and industry, and we are of opinion that not much help can be derived from them in the solution of the problems arising under Art. 286 of the Indian Constitution."

¶195

(See also The State of Bombay v. R. M. D. Chamarbaugwala, 1957 S C R 874 at p. 918 : ( (S) A I R 1957 S C 699 at p. 717) ). The American authorities cited by the Attorney General relate to waiver of obligations under a contract, of the deprivation of right to property without due process of law or of the constitutional right to trial by jury and the like. They have no bearing on the question of the waiver of the equal protection clause of the

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14th Amendment which, like our Art. 14, is a mandate to the State. It is significant that no American decision is forthcoming which upholds the waiver of the breach of that clause, when a case of breach of any of the fundamental rights akin to what are dealt with in the American authorities will come before us it will, then, be the time for us to discuss those authorities and to consider their applicability in the matter of the interpretation of the corresponding provisions of our Constitution. For the moment we prefer to confine our observations to a consideration of waiver of the breach of the fundamental right under Art. 14.”

¶199

Even more emphatic are the observations made in the concurrent decision of K.Subba Rao,J. (as his Lordship then was) in para 78 of the judgment which reads as follows:“78. The learned Attorney General contended that in the American Law the principle of waiver was applied to rights created by the Constitution except in cases where the

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protection of the rights was based upon public policy and that, by the same analogy, no public policy was involved, even in India, the person

¶203

affected by the infringement of the fundamental rights could waive the constitutional protection guaranteed to him. It was said that in the present case the appellant waived his fundamental right under Art. 14 of the Constitution as the right was only in respect of his liability to tax and he could legitimately waive it. To appreciate this argument it would be convenient at the outset to notice the American Law on the subject. Certain rights, which are sometimes described as the Bill of Rights, have been introduced by the Amendments to the Constitution of America. They declare the rights of the people of America in respect of the freedom of religion, speech, press, assemblage and from illegal seizures. They guarantee trial by jury in certain criminal and civil matters. They give protection against self-incrimination. The Fifth

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¶206

Amendment of the Constitution of the United States prescribes that no person shall be deprived of life, liberty or property without due process of law; nor shall private property be taken for public use without just compensation. The Fourteenth Amendment of the Constitution introduces the rule of due process as a protection against the State action. The said amendments are intended as a protection to citizens against the action of the Union and the States. Though the rights so declared are general and wide in their terms the Supreme Court of America, by a long course of judicial interpretation, having regard to the social conditions in that country, has given content to those rights and imposed limitations thereon in an attempt to reconcile individual rights with social good, by evolving counter-balancing doctrines of police power, eminent domain, and such others. During the course of the evolution of the law, attempts were made to apply the doctrine of waiver to the provisions of the

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Constitution of America. American Courts applied the doctrine with great caution and in applying the same, laid down definite principles.”

¶210

The aforesaid view has been reiterated in another Constitution Bench decision of the Apex Court in the case of Olga Tellis and Others Vs. Bombay Municipal Corporation & others: (1985) 3 SCC 545, in para-29 of which relying upon the above decision the law has been reiterated. To the same effect are the observations in the case of Narsingh Pal Vs. Union of India & ors.: (2000) 3 SCC 588.

¶211

On the question of delay and laches learned counsels rely upon the decision of the Apex Court in the case of Tukaram Kana Joshi & Ors. Vs. M.I.D.C. & Ors.: 2013(1) PLJR (SC) 289, in paras 10 to 12 it has been held as follows:-

¶212

“10. The State, especially a welfare State which is governed by the Rule of Law, cannot arrogate itself to a status beyond one that is provided by the Constitution. Our Constitution is an organic and flexible one. Delay and laches is adopted as a mode of discretion to decline exercise of jurisdiction to grant relief.

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¶215

There is another facet. The Court is required to exercise judicial discretion. The said discretion is dependent on facts and circumstances of the cases. Delay and laches is one of the facets to deny exercise of discretion. It is not an absolute impediment. There can be mitigating factors, continuity of cause action, etc. That apart, if whole thing shocks the judicial conscience, then the Court should exercise the discretion more so, when no third party interest is involved. Thus analysed, the petition is not hit by the doctrine of delay and laches as the same is not a constitutional limitation, the cause of action is continuous and further the situation certainly shocks judicial conscience. 11. The question of condonation of delay is one of discretion and has to be decided on the basis of the facts of the case at hand, as the same vary from case to case. It will depend upon what the breach of fundamental right and the remedy claimed are and when and how the delay arose. It is not that there is any period of

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limitation for the Courts to exercise their powers under Article 226, nor is it that there can never be a case where the Courts cannot interfere in a matter, after the passage of a certain length of time. There may be a case where the demand for justice is so compelling, that the High Court would be inclined to interfere in spite of delay. Ultimately, it would be a matter within the discretion of the Court and such discretion, must be exercised fairly and justly so as to promote justice and not to defeat it. The validity of the party’s defence must be tried upon principles substantially equitable. (Vide: P.S. Sadasivaswamy Vs. State of T.N., AIR 1974 Sc 2271; State of M.P. & Ors. Vs. Nandlal Jaiswal & Ors., AIR 1987 Sc 251; and Tridip Kumar Dingal & Ors. Vs. State of West Bengal & Ors., (2009) 1 SCC 768).

¶219

No hard and fast rule can be laid down as to when the High Court should refuse to exercise its jurisdiction in favour of a party who moves

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it after considerable delay and is otherwise guilty of laches. Discretion must be exercised judiciously and reasonably. In the event that the claim made by the applicant is legally sustainable, delay should be condoned. In other words, where circumstances justifying the conduct exist, the illegality which is manifest, cannot be sustained on the sole ground of laches. When substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have a vested right in the injustice being done, because of a non-deliberate delay. The court should not harm innocent parties if their rights have in fact emerged, by delay on the part of the petitioners. (Vide: Durga Prasad Vs. Chief Controller of Imports and Exports & Ors., AIR 1970 SC 769; Collector, Land Acquisition, Anantnag & Anr. Vs. Mst. Katiji & Ors., AIR 1987 SC 1353; Dehri Rohtas Light Railway Company Ltd. Vs. District Board, Bhojpur &

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Ors., AIR 1993 SC 802; Dayal Singh & Ors. Vs. Union of India & Ors., AIR 2003 SC 1140; and Shankara Co-op. Housing Society Ltd. Vs. M.Prabhakar & Ors., AIR 2011 SC 2161).”

¶226

Learned counsels have also sought to invoke the doctrine of promissory estoppel and relied upon the observations of the Supreme Court in the case of M/s. Motilal Padampat Sugar Mills Company Limited Vs. State of Uttar Pradesh & ors.: (1979) 2 SCC 409, in the last part of para-8 of which it has been held as follows:

¶227

“8. ……… …….. ………………… This observation of Lord Denning clearly suggests that the parties need not be in any kind of legal relationship before the transaction from which the promissory estoppel takes its origin. The doctrine would seem to apply even where there is no pre-existing legal relationship between the parties, but the promise is intended to create legal relations or affect a legal relationship which will arise in future. Vide Halsbury’s Laws of England 4^th edn.,l p. 1018,

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¶230

Note 2 to para 1514. Of course it must be pointed out in fairness to Lord Denning that he made it clear in the High Trees case that the doctrine of promissory estoppel cannot found a cause of action in itself, since it can never do away with the necessity of consideration in the formation of a contract, but he totally repudiated in Evenden’s case the necessity of a pre-existing relationship between the parties and pointed out in Crabb V. Arun District Council that equity will, in a given case where justice and fairness demand, prevent a person from insisting on strict legal rights, even where they arise, not under any contract, but on his own title deeds or under statute. The true principle of promissory estoppel, therefore, seems to be that where one party has by his words or conduct made to the other a clear and unequivocal promise which is intended to create legal relations or affect a legal relationship to arise in the future, knowing or intending that it would be acted upon by the

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other party to whom the promise is made and it is in fact so acted upon by the other party, the promise would be binding on the party making it and he would not be entitled to go back upon it, if it would be inequitable to allow him to do so having regard to the dealings which have taken place between the parties, and this would be so irrespective of whether there is any preexisting relationship between the parties or not.”

¶234

I have considered the rival submissions of learned counsels for the parties. On the basic facts there can hardly be any doubt that the cases of five of the six petitioners except M/s. SMS Infrastructure Limited, petitioner in CWJC No. 9326/2013 which was the L-1 tenderer for the district of Nalanda, are on identical footing to that of the four petitioners of the earlier writ applications which were allowed by this Court by order dated 26.4.2013. It is only in the case of M/s. S.M.S. Infrastructure Limited for the district of Nalanda that there is a distinction that this petitioner, although L-1 tenderer over all including Part-A and Part-B in the earlier tender, it is not the L-1 tenderer in

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Part-A but is the second lowest tenderer. It is evident from a perusal of the earlier order that this Court had considered this aspect of the matter and observed that difficulties could have only arisen to the respondent Power Holding Company if the petitioners were not the lowest bidders in the Part-A portion taken separately. At another place it was observed that it is not a case where any difference of L-1 position in Part-A of the tender could have taken place and right of any other party would have been affected or defeated in granting the tender of Part-A to the L-1 tenderers before the Board.

¶238

It is clear that the aforesaid observations have no application in the case of Nalanda district. Learned counsel for the petitioner of Nalanda district has sought to emphasize that being L-1 tenderer over all and L-2 tenderer for Part-A portion since the L-1 tenderer has not come forward to assert its right, the petitioner should be given the benefit of contract for the PartA portion of the tender for Nalanda district.

¶239

In my view there was no occasion for the L-2 tenderer who was L-1 in Part-A tender of Nalanda District to have come forward to assert any of its rights before this Court when the contract was cancelled since it had no right for its tender to be considered by the Board on account of being L-2

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overall. Looking at from the another angle, since the petitioner is not L-1 tenderer for Part-A portion of the tender for Nalanda district, the cancellation of the tender and the re-tender for Nalanda only of the Part-A portion does not affect its rights. That is the crucial issue for consideration before this Court. Hence, so far as the petitioner, M/s. S.M.S. Infrastructure Limited for Nalanda district is concerned, no right of the petitioner was violated by cancellation of the tender for Nalanda district and issuance of fresh tender for Part-A portion; thus it cannot claim the same rights as has been declared by this Court in favour of the earlier four writ petitioners by its order dated 26.4.2013. Accordingly, CWJC No. 9326/2013 is dismissed as the petitioner has been unable to show any violation of its rights on the cancellation of the tender followed by retender for Part-A only.

¶243

So far as the other five writ petitions are concerned, it is evident that the petitioner M/s. ECI Engineering and Construction Company Limited, which was the L-1 tenderer for Rohtas district, had not withdrawn its EMD at any stage. The petitioner has further approached this Court by filing the writ application on 30.4.2013, being CWJC No. 9304/2013 and an interim order was passed in its favour. Thus, the ground of non-

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maintainability of the writ petition raised by learned counsel for the Power Holding Company due to withdrawal of EMD is not at all applicable to the case of the petitioner and the only issue on which the case of this petitioner has been opposed by learned counsel for the respondent-Power Holding Company is the ground of delay and laches.

¶247

So far as the other petitioners are concerned, the challenge essentially is on the ground of waiver of their rights by withdrawing the EMD and further approaching this Court after unexplained delay.

¶248

Considering the sequence of events, I find that the earlier tender was cancelled by a resolution of the Board of Directors of the respondent-Power Holding Company on 8.3.2013. The said cancellation itself was for the first time put up on the website of the respondent-Company on 15.3.2013 and thereafter on 18/19th March, 2013 the four earlier writ petitions were filed. On 26.3.2013 the fresh tender was floated by the respondent-Company. By another office order dated 14.3.2013 of the respondent-Company, the decision of the Board cancelling the previous tender was noted and it was directed that the EMD of the tenderers may be returned; copies of the said office orders were marked to each of the petitioners and pursuant to the same

¶249

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four of the petitioners withdrew the EMD but the question would be whether such withdrawal of the EMD would disentitle the petitioners from approaching this Court in a writ petition, in the facts and circumstances of the present matter, after this Court had held in the case of the four earlier writ petitioners that the action of the Board was arbitrary and unreasonable.

¶252

It is evident from the decision of the Division Bench of the Andhra Pradesh High Court in Syed Moosa Quadri’s case (supra) that when after the rejection of the tender, the tenderer had withdrawn the EMD but was subsequently given the contract on the direction of the Government by the Municipal Corporation which had floated the tender, then the High Court held that the tender was no longer subsisting on account of the withdrawal of the tender. It is however, also to be noted that in the said case the counsel for the tenderer had accepted on learning about the said fact, which was not earlier on the record, that the withdrawal indicated the fact that the tenderer had accepted the rejection of the tender and withdrew the earnest money.

¶253

In the decision of the learned Single Judge of this Court in the Steel Authority of India case (supra) also it appears that the withdrawal of the EMD was considered by this Court as

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having an effect that the petitioner cannot reopen the previous contract after withdrawal of the earnest money.

¶257

In normal circumstances, where only contractual rights of parties are involved, the view can be taken that withdrawal of EMD upon rejection or cancellation of tender tantamounts to closure of the tender and contract and it is not open to the tenderer thereafter to claim anything under the said tender or contract. I may here point out that in the Patna case the withdrawal of EMD took place after the LOI had been issued and cancelled.

¶258

In the present matter however, I find that this Court, after examining the action of the respondent-Power Holding Company in detail, has come to the conclusion that it had been unable to justify its action for cancellation and re-tender of only Part-A of the earlier tender as being arbitrary or unreasonable. This Court has also found that no justifiable reasons have been given by the respondent-BSPHCL for the cancellation either in the impugned order or in this Court in its pleadings. The question therefore, arises whether the petitioners can claim a similarity of treatment invoking Article 14 of the Constitution if the action of the Power Holding Company itself is found to be arbitrary and unreasonable and, therefore, violative of Article 14

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of the Constitution. The Apex Court and this Court have repeatedly held that there cannot be any waiver of fundamental rights. Thus, withdrawal of EMD may put to an end a mere contractual right but cannot be treated as waiver of the fundamental right of the petitioners to be treated equally with those who were situated identically as the petitioners.

¶262

The main issue, therefore, to be considered would be whether the claims of the petitioners would be treated as having been defeated by delay and laches as even a fundamental right may not be permitted to be invoked by the writ court if it is found that the petitioner was guilty of delay and laches. However, as noted in the aforesaid decision of the Apex Court in the case of Tukaram Kana Joshi (supra) the question of delay is one of discretion for the writ court and has to be decided on the facts of the case depending upon what breach of fundamental right is claimed in the writ application and the delay involved. It may also be pointed out that in the decision relied upon by learned counsel for the respondent the delay was of nearly 16 years; such is not the position here. That is not to say that delay of even a month or so may not be fatal. It depends upon various factors whether such delay will defeat the rights of the petitioner or not.

¶263

One of the factors to be considered by this Court

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while examining such issue of delay is as to whether it has led to creation of any 3rd party rights. As noted above, in the present matter no 3rd party rights have been created as the petitioners had approached this Court in all the cases except for the district of Siwan before last date of filing of the tender and interim orders had been passed by this Court not to open the tenders for the said districts. In the case of Siwan also the writ application was filed on 3rd of May, 2013 which was the date of opening of the tender and thereafter by an interim order the respondents had been directed not to open the financial bid and thus there also no 3rd party right has been created. Taken in its totality and considering the fact that the petitioners had filed the writ applications immediately after the decision was rendered in the earlier writ petitions on 26.4.2013, before any 3rd party rights could have arisen, I am of the view that the delay on the part of the petitioners though substantial in the given factual matrix but is not to the extent so as to defeat their rights.

¶267

The other issue to be considered is as to whether the non-submission of the fact of withdrawal of EMD by 3 of the petitioners in their writ applications at the earliest, would amount to suppression of fact so as to disentitle them to the equitable remedy before this Court. It has been submitted by

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learned counsels for the petitioners that immediately after the decision of this Court dated 26.4.2013 the petitioners decided to file the writ applications and filed the same in a great hurry so as to immediately get interim protection from this Court; in the said situation the said fact was overlooked by the petitioners and non-submission of the said fact is not really a suppression of fact rather the same was inadvertent and as soon as they realized the said fact they have stated the same by filing supplementary affidavits.

¶271

In the given facts and circumstances of the case and considering that the decision of this Court was rendered on 26.4.2013 and the last date for filing the tender was 2nd May, 2013, this Court is inclined to accept the submission of learned counsels for the petitioners.

¶272

The other submission of learned counsels, however, that it is only the suppression of material fact and not any fact that has an adverse effect and withdrawal of EMD is not a material fact is, however, unacceptable as withdrawal of EMD is a material fact which ought to have been brought to the notice of the Court at the earliest. However, since I have held that under the given circumstances the petitioners’ plea of inadvertence is accepted, the matter is not required to be pursued further.

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¶275

The last issue to be considered is as to whether the lower RGGVY component in all but one of the present matters would make their cases as not identical to that of the petitioners of the earlier writ petitions. In the earlier writ petitions the lowest RGGVY component was 74.40 % of the total tender amount for Part-A and Part-B portions; in the present matters, the RGGVY component of Gaya is 80.54 % which is above the earlier lowest; Siwan district at 73 % and Patna at 70.21% are not much below the lowest of the previous writ applications. In the case of Rohtas the said component is 67.32% and Araria 65.39 % which are further lower than the RGGVY component accepted in the earlier decision. The ratio of RGGVY component vis-à-vis the State component of 3:1 was found acceptable by the Court in the earlier writ applications; in the matters of Rohtas and Araria instead of 3:1 the said ratio is 2:1. In my view the same is high enough to entitle the petitioners to similar relief as was granted to the earlier writ petitioners by the order dated 26.4.2013.

¶276

Thus, in the light of the aforesaid discussions, CWJC Nos. 9301/2013, 9302/2013, 9304/2013, 9448/2013 and 9617/2013 are allowed and the cancellation of the earlier tender process, in so far as they relate to the districts of Patna, Gaya,

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S.Pandey/-

¶280

Rohtas, Araria and Siwan, is held to be not justified and the decision of the Board of Directors of the Power Holding Company dated 8.3.2013 and the consequential orders in so far as they relate to the same are therefore quashed and the fresh tender notice in so far as it relates to these five districts is also quashed subject to the condition stated hereinafter. The respondents are directed to proceed further in the matter in accordance with law.

¶281

It is directed that the petitioners who had withdrawn their EMD must deposit their respective EMD amounts within a period of two weeks from today and in case the said EMD is not deposited by them within the said period, then the Power Holding Company would be at liberty to proceed with the fresh tenders of those districts.

¶282

(Ramesh Kumar Datta, J)

Vijay Electricals Ltd. v. The Bihar State Power holding Co. Ltd. Patna and Ors.

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Vijay Electricals Ltd. v. The Bihar State Power holding Co. Ltd. Patna and Ors.

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