IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No 2557 of 1996 For Approval and Signature: Hon'ble MR.JUSTICE N.N.MATHUR ============================================================ 1. Whether Reporters of Local Papers may be allowed to see the judgements? 2. To be referred to the Reporter or not? 3. Whether Their Lordships wish to see the fair copy of the judgement? 4. Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder? 5. Whether it is to be circulated to the Civil Judge? -------------------------------------------------------------- NATRAJ ROADLINES Versus GUJARAT STATE CIVIL SUPPLIES CORPORATION LTD -------------------------------------------------------------- Appearance: MR TUSHAR MEHTA for Petitioner MR KM PATEL for Respondent No. 1 Ms.Harsha Devani, AGP for respondents No. 2 to 8 Mr R J Ojha, Advocate for respondent No.10 Rest of the respondents served -------------------------------------------------------------- CORAM : MR.JUSTICE N.N.MATHUR Date of decision: 04/07/96 ORAL JUDGMENT Heard the learned Advocates for the parties. 2. By way of this Special Civil Application, the petitioner-Natraj Roadlines, a transporter, seeks indulgence in the matter of contract given to respondents No.10 to 12 for the transportation of foodgrains and other articles distributed through the network of public distribution system in various godowns situated in all the districts of the State. The facts as culled out from the pleadings of the parties appears to be that the respondent-Corporation had issued an advertisement dated 26.2.1996 for the purpose of transportation of grains and other essential commodities for the period from 1.4.1996 to 31.3.1997. The petitioner had submitted tenders in addition to the districts of Baroda, Valsad, Surat and for the districts in Saurashtra region. One of the conditions of the tender was that the tender form should be accompanied with a Demand Draft of Rs.25,000/- drawn in favour of the respondent-Corporation. The tenders with respect to districts of Baroda, Valsad and Surat were opened on 19.3.1996. The petitioner's tender was not considered for the reason that, the petitioner, instead of Demand Draft, had annexed a receipt of Fixed Deposit of Rs. 25,000/-. The parties were called for negotiation on 22.3.1996. The petitioner approached the respondent stating that on account of a misunderstanding he had annexed the receipt of Fixed Deposit and that he is prepared to deposit the entire amount if so directed. The petitioner did not participate in the negotiation on 22.3.1996. The tenders with respect to the districts of Saurashtra region were opened on 30.3.1996. The tender Committee decided not to consider the tender of the petitioner since he had not complied with the condition No.3.1 of the tender document. Tender of M/s. S Kumar Transport Company and others were also not considered on the ground that their tenders were not accompanied by Demand Draft payable at at Gandhinagar for the amount of earnest money. In other districts also for non-compliance of condition No.3.1, the tenders were not considered. 3. On 30.6.1996, after holding negotiations, the Committee took final decision to accept the tenders of respondents No.10 to 12. The parties conveyed the acceptance of the tenders on 2.4.1996. However, on 4.4.1996, before the agreements could be signed, the interim order of the Court was received and as such the agreements were not signed. However, since the transportation work in various districts for the year 1995-96 had expired on 31.3.1996, the Corporation had to extend the earlier contracts for further period on adhoc basis. 4. It is contended by the learned Advocate for the petitioner that the respondent authorities committed error in rejecting the petitioner's tender just for technical non-compliance. As per the tender condition, the petitioner was required to annex a Demand Draft of Rs.25,000/- instead of that the petitioner annexed a receipt of Fixed Deposit of Rs. 25,000/-. This error was committed bonafidely as in the earlier tender notice dated 8.2.1996, the requirement was to produce a Fixed Deposit Receipt. The petitioner was even prepared to deposit the amount of Rs.25,000/- in cash. The submission of the learned Advocate, therefore, is that the action of the respondent in not considering the petitioner's tender falls in the category of arbitrary action. Mr Tushar Mehta, learned Advocate relies on a decision in the case of M/s. Poddar Steel Corporation vs. Ganesh Engineering Works, reported in AIR 1991 SC 1579. In the said case, the authority held that the requirement in a tender notice can be classified into two categories i.e. those which lay down the essential conditions of eligibility and others which are merely ancillary or subsidiary with the main object to be achieved by the conditions. The Court further held that in the first case, the authority issuing the tender may be required to enforce them rigidly and in the other cases, it must be open to the authority to deviate from and not to insist upon the strict literal compliance of the condition in appropriate cases. In the said case, though the earnest money, under the terms of the tender notice was permitted to be deposited by cash or by Demand Draft drawn on the State Bank of India, the payment of earnest money by certified cheque of the Union Bank of India drawn on its own Branch was treated as sufficient compliance of the term. Considering the facts of the case, the Apex Court expressed that the authority inviting tenders did not commit any error in waiving the literal compliance of such a condition. In my view, this case does not help the petitioner as in that case, the concerned authorities waived the technical compliance and on a petition filed under Article 226 of the Constitution of India by the other party, the High Court interfered and allowed the writ petition on the ground that the party in whose favour the tender was accepted. did not fulfil the condition of the tender notice as the earnest money was offered by the banker's cheque of a bank other than State Bank of India mentioned in the said clause. The Supreme Court held that the concerned authorities were competent to waive such technical or literal compliance of the terms of the tender clause and the High court in such contractual matter, in exefcise of powers under Article 226 of the Constitution, ought not to have interefered. 5. Thus, it is for that authority to take a policy decision, whether to waive or not to waive the condition of technical nature. In normal course, it would not be appropriate for this Court to interfere in such matters. This court has inherent limitations in exercise of powers of judicial review in the matter of exercising of powers by the Government or Governmental bodies except in a case where the decision is arbitrary or malafide. The Supreme Court in the case of Tata Cellular v. Union of India, reported in AIR 1996 SC 32, after examining the various authorities. laid down the following principles for judicial review: "113. The principles deducible from the above are: (1) The modern trend points to judicial restraint in administrative action. (2) The Court does not sit as a court of appeal but merely reviews the manner in which the decision was made (3) The Court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted, it will be substituting its own decision, without the necessary expertise which itself may be fallible. (4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts. (5) The Government must have freedom of contract. In other words, a fairplay in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principle of reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides. (6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure." It is to be borne in mind that in the present case, the tender is with respect to supply of essential commodities and further the tender is only for one year and thus, the time factor is of great significance. The delay in decision at whatever level is bound to interrupt the essential supply of the Articles which may be prejudicial to the public intererest. Such contracts have been given in various Districts of the State of Gujarat. Because of the interim order of this Court, the respondents are compelled to undertake adhoc arrangement. Interference with the policy decision not to waive the error, will cause heavy burden on the administration. It will create more complications affecting the distribution of essential commodities. I can only say that the petitioner should be more careful in future. Thus, I am not inclined to interfere with the decision of the Tender Committee in exercise of powers under Article 226 of the Constitution of India. 6. In view of the aforesaid, I find no merit in this Special Civil Application and the same is accordingly rejected. Notice discharged. ....