IN THE HIGH COURT OF JUDICATURE AT PATNA CWJC No.10006 of 2008 DHANANJAY CONSTRUCTION PVT.LTD Versus THE STATE OF BIHAR & ORS ----------- 02 09.09.2008 State in the Minor Irrigation Department had plans for construction of Weir (short of embankment) was at Bhagwanganj in Masaurhi Block in Patna district. The work calculating estimates etc. were started in the year 2005 at the scheduled rates and then notified by the government. Several attempts were made to get a person to do the work, but, no one come forward. Ultimately, on 15.10.2007, the present notice inviting tender was issued. Admittedly, as per the counter affidavit, no one except the petitioner purchased BOQ (bill of quantity) and accordingly the petitioner was the sole tenderer. He filed his tender agreeing to do the work at 10% above the scheduled rates, as quoted in the BOQ. He then called for negotiations, in negotiation he refused to lower the rates. He was, as such, asked to give in writing the rate at which he was ready to do the work, which was substantial, as he had refused to reduce the rates. Nevertheless, he gave a letter reiterating his tender. After negotiation, petitioner came to know that the scheduled rates had in fact been revised by the government on 01.10.2007 i.e. 15 days prior to NIT and on comparing with the same with those given in the BOQ he found that the rates at which the tender was floated were low rates fixed and relevant for the year 2005, he protested and demanded for rate revision. This is specifically admitted in paragraph 12 of the counter affidavit. - 2 - Even though, authorities realized their mistake and the genuiness of the claim of the petitioner. Merely, sticking by the rules then insisted that the petitioner should enter into written agreement, as per his tender. They threatened with cancellation of his tender, forfeiture of his earnest money and black listing, if he failed to enter into an agreement at the rates tendered. This brought the petitioner to this Court questioning legality of the threats held down and subsequently petition has been filed bringing on record the order of canceling of petitioner’s tender, forfeiting of his earnest money and apprehends to follow in the matter of course. Mr. K.N. Singh, learned senior counsel appearing in support of the writ petition submits that there is no denial that the rates which were quoted in the notice notifying tender were wrong and not the prevalent rates. He further submits that there is no denial in the counter affidavit that the rates at which the NIT were issued were low rates fixed and relevant for the year 2005, and the new rates having been enforced with effect from 01.10.2007 was not in fact taken into note by mistake, when NIT was issued on 15.10.2007. Sri Singh submits that there being a fundamental mistake in the tender document itself should have been sufficient for the respondents to cancel the tender notice itself and issue fresh tender. These facts were known to the authorities, but, apparently issuing fresh tender would take time they rather insisted upon petitioner to abide by his tender, which again was clearly arbitrary and unreasonable. He submitted that once the State realized inflationary trends and revised the scheduled rates on 01.10.2007, the respondents - 3 - were bound to rate revision of scheduled rates, accordingly, as the tender notice was being issued after rate revision and the demand of petitioner for a rate revision was neither unjust nor unreasonable nor arbitrary. It was based on mutual mistake of parties. In my view, the contention of the petitioner is correct and must be accepted. Firstly, it must be noted that several attempts to invite tender failed. Even in this tender petitioner was the only tenderer. Admittedly, before NIT was issued rate had been revised by the State Government, which had not been taken note of or cancelled the NIT that itself in my mind vitiates the NIT on a ground of fundamental mistake. Thus, there was nothing unreasonable, arbitrary or illegal in the demand of the petitioner in rate revision, on coming to know of the said mistake. The learned counsel for the State submits that once the rates were disclosed to the petitioner and he accepted the same and quoted 10% above the rate, he cannot be permitted to resile. I cannot accept this submission for the simple reason, if this is accepted, then, it would permitting the respondents to take advantage of their own default and make profit out of it. State cannot act in such a manner. If the rates had been revised, then, the tender notice had to be on the revised rates. Petitioner subscribe to the rate on the impression that it must have been the revised rates, as there is a presumption that all official acts are duly performed. Once, it was discovered that a mistake had been committed he immediately asked for a rate revision. If the respondents were to act fairly and reasonably they should have accepted the same that withdrawn the tender and issued the tender afresh. My view is - 4 - substantiated from the fact that fresh tenders after cancellation of the previous one have been issued at the new rates, which are substantially different. Thus, in my view, the petitioner cannot be held guilty in not entering in to an agreement and that being so he cannot be held to be in default. Thus, forfeiture of earnest money is not justifying, no punitive action in this regard can be taken. With these observations and directions the writ petition stands allowed. The earnest money lying with the respondents must be refunded forthwith. Trivedi/ (Navaniti Prasad Singh,J.)