Dismissed¶33

M/s S.K. Traders, Birla Mandir Road, Patna v. The Bihar State Text Book Corporation Ltd.

Patna HC9 Feb 2024CWJC/1476/2024

Case brief

AI extract

What is this about?

CWJC No. 1476 of 2024; Patna High Court; decided 09-02-2024; K. Vinod Chandran, CJ; Rajiv Roy, J; M/s S.K. Traders v. Bihar State Text Book Corporation Ltd.; Bihar State Text Book Publishing Corporation Ltd.; tender cancellation; blacklisting for two years; sale of damaged/scrap books 'As Is Where Is'; NIT Annexure E; Category-1 unshredded and Category-2 shredded; 600 MT; site inspection 13.11.2023 to 22.11.2023; bid price excluding GST; NIT Clause 10(a); GST Act; work order Annexure P/2; demand Rs.1,91,54,133/- versus quote Rs.58,71,600/-; rates Rs.26,786 and Rs.9,786 per metric ton; writ petition dismissed.

What did the court decide?

None ¶33

M/s S.K. Traders, Birla Mandir Road, Patna Vs The Bihar… — GST and Indirect Tax | Patna HC (2024)

What the court decided

AI extract

Outcome

None

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Issue for consideration

Whether the petitioner, having made separate bids for shredded and unshredded scrap books, was entitled to have both categories of scrap books awarded to it. +1 more

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Court's answer

First contention rejected: the NIT fixed no separate category-wise quantity, permitted physical site inspection, and contemplated continued sales in both categories on an 'As Is Where Is' basis (not a one-time contract); presuming the entire 600 MT in stock is unshredded, the petitioner - having made separate quotes for both shredded and unshredded material - cannot insist that unshredded material be picked up only if the shredded material is also delivered.

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Ratio / Principle

Price-escalation contention rejected: material value in Annexure P/2 follows the petitioner's own Category-1 (original form) quote of Rs.26,786 per metric ton totalling Rs.1,60,71,600/-; the petitioner's asserted Rs.58,71,600/- corresponds to its Category-2 (shredded) quote of Rs.9,786 per metric ton; having quoted under both categories, the petitioner cannot demand unshredded material at the price quoted for shredded material.

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Key takeaways

Objection to tax addition rejected: NIT Clause 10(a) required GST (charged as per the GST Act) to be included in the quoted price, but the petitioner's uploaded Price Bid Schedule (Annexure-E) specifically indicated the quoted price was excluding GST; hence the petitioner can have no contention regarding escalation of the bid amount, whether on the price quoted for shredded scrap books or on the added tax component.ratio¶29
The work order issued at Annexure P/2 is quite in consonance with the bid made by the petitioner.ratio¶30
The petitioner having failed to deposit the amount and take delivery, the respondent Corporation is justified in passing the Annexure P/1 order.

Detailed headnote1 paragraphs

M/s S.K. Traders, successful bidder under the Bihar State Text Book Publishing Corporation Ltd.'s tender for sale of damaged books (tentative stock 600 MT; Category-1 unshredded and Category-2 shredded, sold 'As Is Where Is', site inspection permitted 13.11.2023 to 22.11.2023), defaulted on the work order demanding Rs.1,91,54,133/- (its Category-1 quote of Rs.26,786 per MT totalling Rs.1,60,71,600/-, plus GST and TCS, its bid having been filed excluding GST despite NIT Clause 10(a) requiring inclusive pricing); the tender was cancelled and it was blacklisted for two years (orders dated 01.01.2024 and 14.12.2023, Annexures P/1 and P/2). Its twin contentions - that only the unshredded contract was awarded despite separate quotes, and that the demand far exceeded its Rs.58,71,600/- shredded-category quote - were rejected: having quoted in both categories, it could not condition taking unshredded material on delivery of shredded stock, could not pay shredded-category rates for unshredded books, and could not object to the added taxes; the work order was in consonance with its bid, and failure to deposit the amount and take delivery justified the Annexure P/1 order. Writ petition dismissed. Oral judgment per the Chief Justice (K. Vinod Chandran, CJ, with Rajiv Roy, J).

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IN THE HIGH COURT OF JUDICATURE AT PATNA Civil Writ Jurisdiction Case No.1476 of 2024

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M/s S.K. Traders, Birla Mandir Road, Patna Through its Proprietor Shankar Kumar, aged about 45 years (Male), Son of Jamuna Kumar Sahu, Resident of 101 Bansi Apartment R.K. Bhatacharya Road, P.O.-Bankipur, P.S.-Pirbahore, District-Patna.

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... ... Petitioner/s

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Versus

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The Bihar State Text Book Corporation Ltd. Pathya Pustak Bhawan, Budha Marg, Patna through its Managing Director.

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The Managing Director, the Bihar State Text Book Publishing Corporation Ltd. Pathya Pustak Bhawan, Budh Marg, Patna.

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The Officer On Special Duty, the State Text Book Publishing Corporation Ltd.

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... ... Respondent/s

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====================================================== Appearance : For the Petitioner/s : Mr.Brisketu Sharan Pandey, Advocate For the Respondent/s : Mr.Naresh Dikshit, Advocate

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====================================================== CORAM: HONOURABLE THE CHIEF JUSTICE and HONOURABLE MR. JUSTICE RAJIV ROY ORAL JUDGMENT (Per: HONOURABLE THE CHIEF JUSTICE)

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Date : 09-02-2024

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The petitioner is aggrieved with Annexure P/1 and P/2 orders; which are respectively the orders dated 01.01.2024 and 14.12.2023 cancelling the tender and blacklisting the petitioner for two years for non-compliance of the work order and the work order itself.

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We have heard the learned counsel for the petitioner and the learned Government Advocate.

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The Bihar State Text Book Publishing Corporation Ltd. (for brevity “the respondent Corporation”) had floated a

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Patna High Court CWJC No.1476 of 2024 dt.09-02-2024 2/6

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tender for sale of damaged books, as is evident from Annexure P/3. The sale was to be carried out on an As Is Where Is basis and it involved the sale of damaged books in the unshredded form and shredded form. The successful tenderer was obliged to take delivery of the material as indicated in the Notice Inviting Tender (NIT) after bearing the charges for loading and transportation. Use of the sold material was also restricted in use for the preparation of pulp/lugdi and not for making envelops from the paper or book so sold or use as waste paper. The prohibitions as stipulated in the NIT were to be undertaken through Annexure F.

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The NIT at Annexure E had the Price Bid Schedule (Financial Bid) wherein the tentative quantity in stock was indicated as 600MT. Two columns were separately provided for Category-1 and Category-2; respectively for the scrap books in original form and in the shredded form. The petitioner bid along with others and was conferred with the award. The petitioner was issued with Annexure P/2, which he failed to comply. The petitioner's contention is that though he had quoted separate bids for the shredded and unshredded scrap books, by Annexure P/2, only the contract for unshredded scrap books have been awarded to him. It is also argued that by

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Patna High Court CWJC No.1476 of 2024 dt.09-02-2024 3/6

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Annexure P/2, the petitioner has been directed to make payment of Rs.1,91,54,133/- which is much higher than the bid or quote of Rs.58,71,600/-.

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The petitioner’s contention is, thus, two fold; (i) both the category of scrap books are to be awarded to the petitioner and (ii) the amounts directed to be deposited as per Annexure P/2 is far above the quote made by the petitioner.

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Insofar as the first contention is concerned, the NIT specifically speaks of two categories of scrap books being tendered for the purpose of sale and requires the bidders to quote separate prices for the two categories, as is evident from Annexure-E which also specifies that the tentative quantity in stock is 600 metric tons. While Annexure-E provides two separate columns for Category-1 and 2; respectively the original and the shredded form of scrap books, there is no separate quantity referred to in the NIT. But we have to specifically notice that the NIT by Column 7 of the first page itself provides that ‘the physical site inspection shall be allowed by 13.11.2023 at 11:00 hours to 22.11.2023 at 16:00 hours’. Hence, it was open for the bidders to visit the site and examine the quantity tentatively intended to be sold on an As Is Where Is basis and ascertain the nature of the same. It is also pertinent that this is

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Patna High Court CWJC No.1476 of 2024 dt.09-02-2024 4/6

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not a one-time contract and the respondent Corporation intended such sale of books in both the categories on an As Is Where Is basis, as and when it is available.

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As of now, the entire 600 metric ton, which was the tentative quantity indicated to be in stock; we have to presume is in the unshredded form. The petitioner having made separate quotes for both the shredded and unshredded material cannot now turn back and say that he will pick up the unshredded material only if he is delivered the shredded material also.

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Insofar as the contention regarding the escalation of price, we have to first notice Annexure-E as per the NIT, as uploaded by the petitioner which is produced by the respondent Corporation in their counter affidavit and available in Annexure P/13. This is the bid document submitted online by the petitioner in which is contained Annexure-E. For Category-1 scrap books in the original form, the petitioner has quoted Rs.26,786 for one metric ton and Category-2, the shredded scrap books, the petitioner has quoted Rs.9,786 for one metric ton. The material value as is seen from Annexure P/2 is based on the quote of the petitioner @ Rs.26,786 for one metric ton, totaling Rs.1,60,71,600/-. The final quote asserted by the petitioner as

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Patna High Court CWJC No.1476 of 2024 dt.09-02-2024 5/6

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seen from the memorandum of writ petition is Rs.58,71,600/which is for shredded scrap books as per the quote of the petitioner @ Rs.9,786/-. The petitioner having quoted under both the categories cannot now claim that the unshredded material available with the respondent Corporation should be delivered to him at the price quoted by him for the shredded material.

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One other reason for the escalation of price to Rs.1,91,54,133/- as seen in Annexure P/2 is the addition of GST and TCS. We have to pertinently notice that NIT at Clause 10(a) indicates that the GST would be charged as per the GST Act and the rate must be included in the quoted price. But Annexure-E uploaded by the petitioner, which is the Price Bid Schedule at columns available at Category-1 and Category-2, specifically indicates that the price quoted is excluding GST. The petitioner, having quoted the price excluding the tax component, hence cannot have any contention regarding escalation of the bid amount, either on the basis of the price quoted for the shredded scrap books or on the addition made of tax.

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The work order issued at Annexure P/2 is quite in consonance with the bid made by the petitioner. The petitioner having failed to deposit the amount and take delivery; the

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Patna High Court CWJC No.1476 of 2024 dt.09-02-2024 6/6

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respondent Corporation is justified in passing Annexure P/1 order.

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