IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.SIRI JAGAN THURSDAY, THE 2ND APRIL 2009 / 12TH CHAITHRA 1931 WP(C).No. 8040 of 2009(Y) PETITIONER(S): C.O.JOHNSON, PROPRIETOR, FLOBAL CONSTRUCTION COMPANY, MARUTHAYATH BUILDINGS THIRD FLOOR, PALLIMUKKU, KUNDARA P.O., KOLLAM DISTRICT. BY ADV. DR.K.P.SATHEESAN SRI.K.K.GOPINATHAN NAIR SRI.M.R.JAYAPRASAD SRI.P.MOHANDAS (ERNAKULAM) SRI.MATHEW SUNNY RESPONDENT(S): 1. INDIAN OIL CORPORATION LTD., (MARKETING DIVISION), KERALA STATE OFFICE, PANAMPALLY AVENUE, PANAMPILLY NAGAR P.O., KOCHI-36, REPRESENTED BY ITS CHIEF L.P.G.MANAGER. 2. THE CHIEF L.P.G.MANAGER, INDIAN OIL CORPORATION LTD., KERALA STATE OFFICE, PANAMPALLY NAGAR, KOCHI-36. 3. INDIRA SEELAN, PROPRIETRIX, SREE NILAYAM TRANSPORTS, ATTINKUZHY P.O., KAZHAKOOTTAM, THIRUVANANTHAPURAM. ADV. SRI.E.K.NANDAKUMAR FOR R1&2 SRI.K.L.VARGHESE FOR R3 SMT.SANTHA VARGHESE FOR R3 SRI.A.K.JAYASANKAR NAMBIAR FOR R1 & 2 SRI.K.JOHN MATHAI FOR R1 & 2 SRI.P.BENNY THOMAS FOR R1 & 2 SRI.ANIL D. NAIR FOR R1 & 2 SRI.V.J.ANAND FOR R1 & 2 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 02/04/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: PETITIONER'S EXHIBITS: W.P.C.NO. 8040/2009. ------------------------------------------------------------------- EXT.P1 TRUE COPY OF RELEVANT PAGES OF CREDENTIAL BID DT. 19-2-2009. EXT.P2 REPRESENTATION DT. 23-2-2009. EXT.P3 PAYMENT VOUCHER DT. 10-3-2009. EXT.P4 NOTICE DT. 19-3-2009. RESPONDENTS' EXHIBITS: ------------------------------------- EXT.R2(a) TENDER SUBMITTED BY R3. EXT.R2(b) LETTER OF INTENT. EXT.R2(c) STATEMENT SHOWING COMPARATIVE RATE. EXT.R2(d) DEEDS OF DISSOLUTION OF PARTNERSHIP. EXT.R3(a) DEED OF DISSOLUTION OF THE FIRM SREENILAYAM TRANSPORT DT. 27-12-2008. EXT.R3(b) DEED OF DISSOLUTION OF SREENILAYAM TRANSPORTS DT. 31-12-2008. [TRUE COPY] P.S TO JUDGE. S. Siri Jagan, J. =-=-=-=-=-=-=-=--=-=-=-=-=-=-=-=-=-= W. P (C) No. 8040 of 2009 =-=-=-=-=-=-=-=-=--=-=-=-=-=-=-=-=-= Dated this, the 2nd April, 2009. J U D G M E N T Respondents 1 and 2 herein floated a tender as per Ext. P1 tender notification. Both the petitioner as well as the 3rd respondent submitted tenders. Before the tender was finalised, the petitioner has filed this writ petition contending that the 3rd respondent is disqualified for participating in the tender in view of the express bar in the tender conditions. According to the petitioner, the 3rd respondent is disqualified on account sub-clauses 13 and 14 of Clause 11 of the general guidelines contained in Ext. P1. The contention is that as per sub-clause 13, the party (firm/partner/director/proprietor) should not be a transport contractor at that particular plant. Secondly, as per sub-clause 14, tenderers should have experience of doing similar type of work related to Handling/job contract and copies of such work orders to be attached along with the tender, which qualification the 3rd respondent does not have. The contention is that the 3rd respondent, along with her husband, was a partner of a firm called “Sree Nilayam Transport, Thiruvananthapuram.” That firm in which the 3rd respondent is a partner is a contractor for transportation in this particular plant. The petitioner would contend that as a partner of a firm which is holding and transporting contractor in the same plant, the 3rd respondent is disqualified from participating in the tender by virtue of sub-clause 13. The petitioner would also contend that the 3rd respondent does not have the qualification prescribed under clause 14. 2. After admitting the writ petition, on 26-3-2009 , I passed an interim order to the following effect: 'The first respondent may process the tenders. However, if the third respondent is the successful tenderer, tender shall not be awarded without obtaining orders from this Court .” W.P.C. No. 8040/09 -: 2 :- Now, the parties have filed counter affidavits and in view of the fact that the contract has to start from 1-4-2009, the matter was heard urgently. 3. As permitted by this Court , tenders were processed and it now appears that the Sree Nilayam Transports had quoted (-) 18% and the petitioner has quoted (-) 14.3%. All others have quoted lesser price. Therefore, as it stands now, Sree Nilayam Transport is the lowest tenderer. 4. The answer given by respondents 1 and 2 to the contention raised by the petitioner that the 3rd respondent is not qualified to participate in the tender on account of she being an existing contractor of the plant, is that the earlier contract was given to M/s. Sree Nilayam Transports, which was a partnership firm consisting of the 3rd respondent and her husband for a period of three years ending with 31-3-2009. In December, 2008, that partnership firm was dissolved and the contract was allowed to be continued by the husband of the 3rt respondent as a proprietary concern. Therefore, according to respondents 1 and 2, which is supported by the 3rd respondent, the 3rd respondent is not a subsisting contractor attracting the disqualification under sub-clause 13 mentioned above. 5. The contention of the 3rd respondent is that Section 40 of the Partnership Act permits dissolution of the firm at any time. That firm has been dissolved and the contract given to the partnership firm was, with the permission of respondents 1 and 2, given to the 3rd respondent's husband as a proprietary concern. Therefore, the 3rd respondent ceases to be an existing contractor and therefore she is qualified to participate in the tender. 6. I have considered the rival contentions in detail. W.P.C. No. 8040/09 -: 3 :- 7. Sub-clause 13 reads thus: “13. The party (firm/partner/director/proprietor) should not be transport contractor at that particular plant.” It is not disputed before me that the earlier contract was given to a partnership firm consisting of the 3rd respondent and her husband. It continued for more than 2 ½ years until before the month when the tender was floated. It was immediately before the floating of the tender that this process of dissolution of the firm accepting the husband alone as the contractor was undertaken. I am of opinion that such conduct of the respondents is not transparent. Respondents 1 and 2 as public authorities are bound to arrange their business transactions in a transparent manner. If a partnership which took a contract ceased to exist, then the contract would also cease to exist. Being a public authority, on termination of that contract, before giving the contract to one of the partners of the same firm, respondents 1 and 2 were bound to invite fresh tenders. Respondents 1 and 2 cannot, under law, choose one of the partners and allow him to continue the contract. In this connection, I also note that the petitioner has, along with the reply affidavit, produced Ext. P3, whereby respondents 1 and 2 had made payment to Sree Nilayam Transports in respect of the earlier contract itself for the month of February 2009 i.e. after the tender notification was issued. Of course, counsel for respondents 1 and 2 would submit that although the name is the same, it was as a proprietary concern and not as a partnership. I remain totally unconvinced. I am satisfied that the procedure adopted by the respondents is not transparent at all. She having been party to a contract, which was subsisting, she was clearly disqualified under sub-clause 13. Therefore, the contract cannot be W.P.C. No. 8040/09 -: 4 :- given to the 3rd respondent since she is not qualified for that reason. It is declared so. 8. Now the question is as to the next course of action. I put it to the petitioner as to whether he is prepared to undertake the contract at the rate offered by Sree Nilayam Transport, i.e. (-) 18%. Counsel for the petitioner submits that the petitioner is willing to take the contract at that rate. That being so, the petitioner being the lowest tenderer, respondents 1 and 2 are bound to give the contract to the petitioner at that rate pursuant to Ext. P1 tender notification. The writ petition is allowed as above. Sd/- S. Siri Jagan, Judge. Tds/