SCA/947220/2008 1/8 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No. 9472 of 2008 For Approval and Signature: HONOURABLE MR. JUSTICE MOHIT S. SHAH and HONOURABLE MS.JUSTICE H.N.DEVANI ============================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ============================================= ANILKUMAR AMOLAKCHAND KANSAL - Petitioner(s) Versus ADMINISTRATOR (NOTIFIED AREA) & 2 - Respondent(s) ============================================= Appearance : MR ASHISH M DAGLI for Petitioner(s) : 1 MS NISHA PARIKH for Respondent(s) : 1- 2, DS AFF.NOT FILED (N) for Respondent(s) : 3, MR ND NANAVATY Sr. Advocate with MR MITUL SHELAT and MR YASH N NANAVATY for Respondent(s) : 3, ============================================= CORAM : HONOURABLE MR. JUSTICE MOHIT S. SHAH and HONOURABLE MS.JUSTICE H.N.DEVANI Date : 11/11/2008 ORAL JUDGMENT (Per : HONOURABLE MR. JUSTICE MOHIT S. SHAH) SCA/947220/2008 2/8 JUDGMENT RULE. Ms Nisha Parikh, learned AGP waives service of Rule for respondent Nos.1 and 2. Mr Yash Nanavaty waives service of Rule for respondent No.3. In the facts and circumstances of the case, the petition is taken up for final disposal today. 2. What is challenged in this petition under Article 226 of the Constitution is the decision of respondent Nos.1 and 2 awarding the contract for collection of toll tax at Saputara to respondent No.3 at the monthly rate of Rs.11,11,111/- for the period from 1.7.2008 to 30.6.2009. 3. Tenders were invited by the respondent – authorities for collection of toll tax at Saputara with upset price of Rs.6,90,000/- per month and the authority received a large number of offers, out of which 24 offers were found to be valid. Out of the valid offers, the highest six offers were as under :- Bajirao S. Gangude Rs.21,25,000/- Santoshkumar Shukla (respondent No.3) Rs.11,11,111/- M/s. S.S. Enterprise Rs. 9,99,786/- Raghunath Laxman Gavde Rs. 9,66,666/- K.G. Agro Processors Rs. 9,25,099/- Anilkumar Amolakchand Kansal (petitioner) Rs. 8,11,000/- Condition No.12 of the Tender Conditions conferred discretion on the authority to require the parties to go for inter-se bidding after SCA/947220/2008 3/8 JUDGMENT opening of the offers and in such an eventuality inter-se bidding would start with the highest offer received upwards. Accordingly, the authority called upon the bidders who were present at the time of opening the bids on 27.6.2008 to submit any further higher offer. However, none of the bidders present offered any higher offer and, therefore, respondent No.1 submitted a proposal dated 27.6.2008 to the Collector recommending acceptance of the offer of Bajirao S Gangude at the rate of Rs.21,25,000/- per month. The rojkam and recommendation to the above effect is produced at Annexure R-III to the reply affidavit filed by Deputy Collector and Chief Officer, Notified Area, Saputara, Dangs – respondent No.1 herein. The Collector accepted the above recommendation and accordingly the Letter of Intent for collection of toll tax in the Notified Area of Saputara for one year period from 1.7.2008 to 30.6.2009 was granted to Bajirao S Gangude vide letter dated 28.6.2008. The said party was called upon to deposit the requisite amount immediately and take charge of the toll booth on 1.7.2008. However, the said Bajirao S Gangude could not make any payment and did not come forward to take charge of the toll naka. After issuance of the second notice dated 2.7.2008, that party approached the respondent – authorities on 4.7.2008 and submitted an application to the respondent stating that he had by mistake quoted the price at Rs.21,25,000/- per month and that he had intended to quote Rs.21,25,000/- per annum. That party also submitted an affidavit to that effect. In view of this stand of Bajirao S Gangude that his real offer was Rs.1.77 lakhs per month, the respondent – authorities immediately cancelled the Letter of Intent issued to Bajirao S Gangude and forfeited his Earnest Money Deposit of Rs.69,000/- on SCA/947220/2008 4/8 JUDGMENT 18.7.2008. In the meantime, the authorities then decided to accept the second highest offer of respondent No.3 which was Rs.11,11,111/- per month vide order dated 15.7.2008 and awarded the contract to respondent No.3 for the period from 1.7.2008 to 30.6.2009. Respondent No.3 paid the requisite amount on 15.7.2008 itself and took over charge of the toll naka. 4. The present petition came to be filed by the petitioner on 18.7.2008 contending that on 27.6.2008, the petitioner or any other party did not make any higher offer because the highest offer was at Rs.21,25,000/- and nobody was interested in submitting any offer higher than that, but when Bajirao S Gangude did not show his readiness and willingness to accept the contract and the next higher offer of Rs.11,11,111/- was to be accepted, the petitioner and others should have been given an opportunity to submit the revised higher offer. It is submitted on behalf of the petitioner that the main terms and conditions of the Tender Notice (Annexure-A) was very clear and it was specifically mentioned that the upset price was Rs.6,90,000/- on monthly basis and there was no scope for any misunderstanding on the part of anyone. It is the petitioner's case that this device was adopted for the purpose of ensuring that respondent No.3 would be awarded the contract at the rate of Rs.11,11,111/- without any competition from any other party who had naturally opted out of the competition in view of the highest offer of Bajirao S Gangude at Rs.21,25,000/-. 5. At the hearing on 6.10.2008, the petitioner had also shown his readiness and willingness to offer monthly installment of Rs.15 lakhs and to show his bonafides, the petitioner deposited a sum of Rs.15 lakhs with the Registry of this Court within one week from the date of the order. The amount was accordingly deposited on 13.10.2008. SCA/947220/2008 5/8 JUDGMENT 6. In response to the notice, affidavit-in-reply has been filed by Deputy Collector and Chief Officer, Notified Area, Saputara, Dang. The basic facts of the case are not in dispute and the stand of the respondent – authorities is that since the previous contract for collection of toll tax expired on 30.6.2008 and Bajirao S Gangude did not deposit the requisite amount and take over the charge of toll naka despite two notices, the authorities had to make urgent arrangements and, therefore, the contract was awarded to the second highest bidder i.e. respondent No.3 herein for monthly amount of Rs.11,11,111/-. 7. Affidavit-in-reply has also been filed on behalf of respondent No.3 mainly challenging the bonafides and antecedents of the petitioner on the ground that the petitioner was allowed licence to run a canteen at the Surat ST Bus Depot by Gujarat State Road Transport Corporation and the petitioner had defaulted in payment of dues of the Gujarat State Road Transport Corporation and also the dues of the Surat Municipal Corporation to the tune of Rs.75,74,318/- and Rs.75,62,162/- respectively. It is also stated that the petitioner had filed Special Civil Application before this Court and this Court had granted conditional stay granting protection, subject to the condition that if the petitioner was in arrears for more than two installments, the protection would cease to operate. It is also stated that the petitioner does not have the necessary financial strength to operate the contract in question, more particularly looking to the amounts lying in the petitioner's bank accounts. 8. We have heard Mr Ashish Dagli, learned advocate for the petitioner, Ms Nisha Parikh, learned AGP for the respondent – authorities and Mr ND Nanavaty, learned Senior Advocate for respondent No.3 who have made the submissions on the lines indicated in the pleadings filed SCA/947220/2008 6/8 JUDGMENT by the respective parties. 9. There is no dispute about the fact that when the tenders were opened on 27.6.2008 and the bidders present were informed about the offers made by the respective parties, 24 of whom were found to have made valid offers above the upset price, all such parties who had made valid offers were given an opportunity to submit any further higher offer above the highest offer of Rs.21,25,000/- made by Bajirao S Gangude, but nobody was ready and willing to submit any offer above Rs.21,25,000/-. 10. Without going into the allegations made by the petitioner about any device adopted by any party, the fact remains that if Bajirao S Gangude had himself made it clear before the authorities as well as the bidders present on 27.6.2008 that he was not interested in accepting the contract at the rate of Rs.21,25,000/- per month, the authorities would have called upon the bidders present whether they were ready to make any offer above the offer of respondent No.3 at Rs.11,11,111/- which was the next highest offer. Condition No.12 of the Tender conditions also provided that the respondent authority may invite inter-se bidding at the time of opening the tenders taking the highest offer as the upset price for the purpose of such inter-se bidding. 11. It would, therefore, be necessary for the authorities to give this opportunity to all the parties who were found to be eligible. However, with the passage of about four months' time by now, and considering the fact that the contract awarded to respondent No.3 is for the period upto 30.6.2009, we have considered it appropriate to mould the reliefs in the facts and circumstances of the case and, therefore, we direct respondent Nos.1 and 2 to issue a fresh advertisement inviting the offers for SCA/947220/2008 7/8 JUDGMENT collection of toll tax at Saputara specifically mentioning that the upset price shall be Rs.11,11,111/- per month for the contract to be awarded for the period commencing from 1.1.2009. It shall also be indicated in the advertisement that the present petitioner has made the offer of Rs.15 lakhs per month. 12. We must take note of the anxiety expressed by the learned AGP on behalf of the authorities that in case a party is not found to be a genuine party with sound financial capacity, again fresh exercise may have to be undertaken. Hence to deter non-genuine parties, appropriate safeguards may be provided. In order to take care of this anxiety, we make it clear that it will be open to the respondent – authorities to provide in the terms and conditions that the Earnest Money Deposit shall be at least Rs.11,11,111/- or one monthly installment being offered by the party, whichever is higher. It will also be open to the respondent – authorities to provide in the Tender Conditions that the party whose offer is accepted shall have to deposit advance monthly installments for three months before the contract is awarded. It will also be open to the authorities to provide such other and further terms and conditions which were already incorporated in the previous tender notices, subject to the above two conditions regarding Earnest Money Deposit and condition for deposit of certain advance monthly installments by the party in whose favour the contract is awarded. 13. We also record the statement made by the learned advocate for the petitioner, under instructions of the petitioner who is present before the Court, that the petitioner will make the offer of at least Rs.15 lakhs per month and that the amount of Rs.15 lakhs deposited with the Registry of this Court on 13.10.2008 may be transferred to respondent No.1 – Administrator, Notified Area, Saputara, Dist. Dang who shall treat SCA/947220/2008 8/8 JUDGMENT the same as Earnest Money Deposit for the offer to be made by the petitioner in response to the advertisement which shall be issued latest by 30.11.2008. The Registry shall act on the basis of the above statement and transfer the amount of Rs.15 lakhs deposited by the petitioner on 13.10.2008 to respondent No.1 – Administrator, Notified Area, Saputara, Dist. Dangs who shall accept the same as EMD from the petitioner. 14. It is made clear that respondent No.3 will be permitted to collect toll tax in accordance with the terms and conditions of the Letter of Intent / contract awarded in his favour, but the period of such Letter of Intent / contract shall be confined upto 31.12.2008. 15. The petition is accordingly disposed of in terms of the above directions. Rule is made absolute to the aforesaid extent. Direct service is permitted. (M.S. SHAH, J.) (HARSHA DEVANI, J.) zgs/-