IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) FRIDAY, THE SECOND DAY OF MAY TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MR JUSTICE N.V. RAMANA WRIT PETITION NO : 7370 of 2008 Between: M/s. Infotech Enterprises limited, a Company incorporated Under the Companies Act 1956, having its Registered Office, at Plot No. 11, New Software Layout, Infocity, Madhapur, Hyderabad, Rep. by its Authorised Signatory Sri Chandra Sekhar Nori S/o.Late Laxmikanth Satry, aged 54 yrs, R/o. B 158, Akshya AFOCHS, Sainikpuri,Hyd. ..... PETITIONER AND 1 The Commissioner, Survey , Settlement and Land Records , Government of Andhra Pradesh, Survey Bhavan, Narayanaguda, Hyderabad. 2 National Institute for Smart Government (NISG) Rep. by its Chief Executive Officer, Gachibowli, Ranga Reddy District. 3 The Director General, Civil Aviation, Government of India, RK Puram, New Delhi. 4 M/s. Speck Systems Limited, a Company incorporated under the Companies Act 1956, having its registered office at Rep. by its Managing Director Sri K.C. Muni Kumar S/o. Late Pandu Rangaiah Chetty, aged about 54 yrs R/o. B121, AFOCHS, Sainikpur, Secunderabad-94 5 M/s. Secon Survyes,. Rep. by its Director C/o. Plot No. 147, 7B Road, EPIP White Field, Bangalore-560 066 6 M/s.Arvee Associates, Architects, Engineers & Consultants Pvt.ltd., Rep. by its Director C./o. Ravula Residency, Srinagar Colony, Hyderabad-82 .....RESPONDENT(S) Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Affidavit filed herein the High Court will be pleased to to grant an appropriate writ order or direction more particularly one in the nature of writ of Mandamus declaring the Tender process initiated by the 1st respondent for awarding Cadastral Surveys in five Districts of Andhra Pradesh,namely Anantapur, Kadapa, Nellore , Karimnagar and Srikakulam under Bhu Bharathi Rollout Phase-I pursuant to its tender notification No. BB/Survey/485/08 dt. 18-1-2008 and in disqualifying the petitoners bid as illegal, arbirary violative of Article 14 and principles of Natural justice and is vitiated in view of the onerous conditions contemplated by the 1st respondent solely to facilitate the 4th Respondent and others and pass Counsel for the Petitioner:MR.KANAKAMEDALA RAVINDRA KUMAR Counsel for the Respondent No.: GP FOR REVENUE IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) FRIDAY, THE SECOND DAY OF MAY TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MR JUSTICE N.V. RAMANA WRIT PETITION NO : 8599 of 2008 Between: ICC Technologies Pvt Ltd A Comapany incorporated under the provisions of Companies Act,Rep.by its Vice President Finance Mr.R.Kiran Babu S/o.Koteswara Rao 6-3-374/17/11-A Dwarakapuri Colony Panjagutta Hyd-500082 ..... PETITIONER AND 1 The Commissioner Survey Settlement and Land Records, Govt of A.P Survey Bhavan,Narayanaguda Hyd 2 The Director General Civil Aviation Govt of India RK Puram New Delhi 3 M/s.Speek Systems Ltd Regd.Office at B49 Electronics Complex Kushaiguda Hyderabad Rep.by its Managing Director 4 M/s.Secon Survyes Rep.by its Director C/o.Plot No.147 7B Road EPIP White Field Bangalore-560066 5 M/s.Arvee Associaties Architects Engineers& Consulants PVT Ltd Rep.by its Director C/o.Ravula Residency Srinagar Colony Hyd-82 .....RESPONDENT(S) Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Affidavit filed herein the High Court will be pleased to to grant an appropriate writ,order or direction more particularly one in the nature of writ of Mandamus declaring the Tender process initiated by the 1st respondent for awarding Cadastral Survey in Five Dists fo A.P namely Anantapur,Kadapa,Nellore,Karimnagar and Srikakulam Under Bhu Bharathi /Rollout Phase-1 pursuant to its tender notification No.BB/Survey/485/08 dtd 18-01- 2008 and in disqualifying the petitioner's bid as illegal arbitrary violative of Artilce 14and principles of Natural jsutice and is vitiated in view of the onerous conditions contemplated by the 1st respondent soley of facilitate the 3rd respondent and others and pass Counsel for the Petitioner:MR.P.V.A.PADMANABHAM Counsel for the Respondent No.: GP FOR REVENUE The Court made the following : THE HON’BLE SRI JUSTICE N.V. RAMANA W.P. Nos. 7370 and 8599 of 2008 Common Order: Invoking the extraordinary jurisdiction of this Court under Article 226 of the Constitution of India, the petitioners, namely M/s. Infotech Enterprises Limited and M/s. IIC Technologies Pvt. Ltd., have filed these two writ petitions praying for the following relief: To grant an appropriate writ, order of direction, more particularly one in the nature of Writ of Mandamus, declaring the tender process initiated by respondent No.1 for awarding Cadastral Surveys in five districts of Andhra Pradesh, namely Anantapur, Kadapa, Nellore, Karimnagar and Srikakulam under Bhu Bharathi Rollout Phase-I, pursuant to its Tender Notification No. BB/Survey/485/08, dated 18.01.2008 and in disqualifying the petitioner’s bid as illegal, arbitrary, violative of Article 14 of the Constitution of India and principles of natural justice and is vitiated in view of the onerous conditions contemplated by respondent No.1 solely to facilitate respondent No.3 and other, and pass such other order or orders as this Hon’ble Court may deem fit and proper in the circumstances of the case. Respondent No.1, namely Commissioner, Survey, Settlement and Land Records (hereinafter referred to as ‘CSSLR’), issued ‘Request for Proposals’ dated 18.01.2008, inviting proposals from prospective bidders for providing Aerial Photography, Aerial Photogrammetry and Cadastral Survey for five districts in Andhra Pradesh under Bhu Bharati Project. Respondent No.1-CSSLR has appointed the National Institute for Smart Government as their Consultant for the said project. The petitioners and several other Companies responded to the notification and submitted their Request for Proposals. Before initiating the process, respondent No.1-CSSLR conducted Pre-bid Conference on 08.02.2008. The petitioners participated in the Pre-bid Conference along with others, and raised their objections as to obtaining the clearances. Respondent No.1-CSSLR, having considered the said objections, issued letter dated 15.02.2008, followed by another letter dated 26.02.2008, to enable the petitioners and other apply for and obtain necessary clearances from respondent No.2, namely Director General of Civil Aviation (DGCA), for aerial flying over the five districts, to enable them meet the requirements of Request for Proposals. The Request for Proposals permitted formation of consortium before the bids are subjected to pre-bid qualification. Before issuance of the said letters, the petitioners state that respondent No.2 issued errata on 14.02.2008 deleting Clause 2.3(b), which requires obtaining of clearance certificates before the bids are subjected to pre-qualification and they have also modified Clause 2.5(a) to the effect that commercial bids will be opened only if the bidder or consortium fulfils the criteria mentioned therein. Respondent No.1-CSSLR has also postponed the dates of consideration of the bids by 15 days, and by virtue of such postponement and alteration of the conditions of the Request for Proposals, formation of consortium and obtaining of required clearances by the bidders was postponed from the stage of pre- qualification to that of commercial evaluation. The bids of the petitioners qualified in the pre-qualification and technical evaluation, but their bids were rejected for commercial evaluation as they failed to produce the necessary clearances from respondent No.2-DGCA on 20.03.2008 when the commercial bids were to be opened. Assailing the said action of respondent No.1-CSSLR in not considering their bids for commercial evaluation, and thereby throwing them out of the tender process, they filed the present writ petitions, inter alia, contending that the entire tender process has been designed to suit respondent No.3, namely M/s. Speck Systems Limited, which has been selected, and through whom respondent Nos.4 and 5 are sharing the work by associating themselves with respondent No.3. Sri S.R. Ashok, the learned Senior Counsel representing M/s. IIC Technologies Private Limited, whose submissions Sri Kanakamedala Ravindra Kumar, the learned counsel appearing for M/s. Infotech Enterprises Limited adopted, submitted that respondent No.3 was slyly kept informed of the impugned tender notification much in advance in the month of September 2007 and to support this submission, he placed reliance on letter dated 20.09.2007, addressed by respondent No.1-CSSLR to respondent No.3, and by doing so, respondent No.3 has become a blue eyed boy. As respondent No.3 was kept informed much in advance, they applied for the necessary clearances in advance. He submitted that as per the policy guidelines dated 01.05.2006, issued by the Government of India, applications for aerial photography should be made to DGCA atleast six weeks before the date on which the photography is to be carried out, and which in fact, should be supported by letter of authority from the State/Central Government as the case may be. Even though respondent No.1- CSSLR issued letters to the petitioners to obtain necessary clearances, they were insufficient to get the clearances. Thus, by doing so, they have not created a “level playing field” to the petitioners and others on par with respondent No.3. He submitted that to accommodate respondent No.3, respondent No.2 has modified the Request for Proposals, by reason of which the requirement of formation of consortium and obtaining of necessary clearances was postponed from the stage of pre-qualification to that of commercial evaluation. He submitted that the clearance given by respondent No.2-DGCA to respondent No.3 is not a tradable instrument, but by modifying Clause 2.5(a), respondent No.2 had permitted formation of consortium by respondent Nos.3, 4 and 5, which in fact, runs contrary to Clause 1.15(ix) of the Request for Proposals, which provides disqualification of bids if common interest are found in two or more bids. Referring to the letter dated 03.04.2008, issued by the Ministry of Defence, which requires the Government to forward only the list of approved photographic agencies to whom the contract of undertaking the survey task has been finalized, he submitted that it is next to impossible for the petitioners to get the necessary clearance from the Ministry of Defence as the clearance is to be granted only if the contract work has been finalized in favour of a particular agency. He submitted that since respondent No.1- CSSLR knows of this procedure, framing of the tender conditions contrary thereto is illegal and arbitrary. Respondent No.1-CSSLR filed counter. Sri C.V. Mohan Reddy, the learned Advocate-General, reiterating the said counter averments submitted that considering the pilot project executed by NRSA in Nizamabad district, respondent No.1-CSSLR desired to entrust the project work to NRSA, but as NRSA has not come forward to undertake the work, they were constrained to get the work executed through private agencies. He denied that any favouritism was shown to respondent No.3, he also denied that respondent No.3 was informed about the project work in advance. He submitted that respondent No.3 acting on newspaper report which published the decision taken by the Cabinet with regard to the project, made enquiries from respondent No.1-CSSLR and that is how respondent No.3 came to know in advance and they having made enquiries applied for and obtained necessary clearances from the Ministries concerned in advance. He submitted that the letters of the nature addressed to respondent No.3 in response to enquiry made by them were even addressed to several other companies, the list of which were furnished by Geological Survey of India, including the petitioners and requesting them to make preparatory work. He denied the contention of the petitioners that the requirement of forming consortium and obtaining of clearances which was required at the stage of pre-qualification was postponed to the stage of commercial evaluation to facilitate respondent No.3 from obtaining the necessary clearances and respondent No.3 associating with respondent Nos. 4 and 5. He submitted that but for the postponement of the schedule, the petitioners bids would have been rejected at the pre-qualification stage itself, but despite postponing the schedule and providing ample time, the petitioners could not produce the necessary clearances, and as the petitioners neither produced the necessary clearances nor formed into consortium with persons who were possessing necessary clearances, their bids were not considered for commercial evaluation. He submitted that letter dated 03.04.2008, which the petitioners contend have made them impossible to get the necessary clearances, has only a prospective effect, and basing on such letter he cannot contend that respondent No.1-CSSLR had intentionally framed tender conditions contrary thereto. He, thus, submitted that the petitioners cannot complain of any discrimination or favouritism to respondent No.3, and prayed that the writ petition be dismissed. Sri. C. Prakash Reddy, learned Senior Counsel representing Sri C. Kodandaram, learned counsel for respondent No. 3, denied any favour having been shown by respondent No.1-CSSLR to respondent No.3, and contended that respondent No.3 acting on the newspaper reports, made enquiries from respondent No.1-CSSLR, and after ascertaining the requirements for bidding, applied for necessary clearances, and accordingly obtained aerial flying permission from respondent No.2-DGCA in the month of December, 2008 itself, and as such, the petitioner cannot contend that respondent No.1-CSSLR had extended the time to facilitate respondent No.3 to obtain necessary clearances. In fact, on 30.11.2007 itself respondent No.1-CSSLR had informed all the companies, including the petitioner about the requirement of obtaining permission for aerial flying from respondent No.2-DGCA to enable them to bid for the Request for Proposal to be issued. Heard the learned senior counsel for the petitioner, the learned Advocate General for respondent No.1-CSSLR and the learned senior counsel for respondent Nos. 3 to 4. The contention of the petitioners that respondent No.1-CSSLR had leaked the information about the project work to be notified to respondent No.3 in advance, which facilitated respondent No.3 from obtaining necessary clearances from the Ministries concerned, cannot be sustained, for the reason that it is the specific case of respondent No.1-CSSLR that a news item about the decision taken by the Government in relation to the project appeared in newspapers in Deccan Chronicle on 12.08.2007. Responding to the said news item, respondent No.3 made enquiries with respondent No.1-CSSLR, who vide letter dated 20.09.2007, informed respondent No.3 that “if they got technical and logistic capabilities to take up aerial photogrammetry (with digital camera), subsequent processing of the data and generation of ortho photos and requested them to indicate the approximate cost of these activities together and separately for each of them, and further required them to indicate whether they will be able to obtain necessary clearance from the Ministry of Defence and if so in what time.” Basing on this letter of respondent No.1-CSSLR, it appears respondent No.3, vide letter dated 10.10.2007, applied for necessary clearance to the Ministry of Defence, and this is evident from the fact that the Ministry of Defence responding to the said letter of respondent No.3, vide letter dated 25.10.2007, conveyed them that the company “in principal” is allowed to carry out aerial photography over five districts in Andhra Pradesh for generation of cadastral maps. Thereafter, vide office memorandum dated 27.12.2007, respondent No.3 was granted the necessary clearance for aerial photography. Further, similar letter dated 20.09.2007 was addressed to M/s. Geotrax International Services when they, vide letter dated 18.12.2007, made enquiries with respondent No.1-CSSLR with regard to the project. Thus, it is clear that respondent No.1-CSSLR did not inform respondent No.3 about the project in advance, but respondent No.3 came to know of the project only through newspapers, and they having evinced interest in the project, made enquiries, and taking note of the requirements of the project, applied for necessary clearances from the Ministry of Defence. Thus it is clear that respondent No.1-CSSLR had not leaked any information to respondent No.3, but respondent No.3 being vigilant, acted on the news item, and upon making necessary enquiries, took timely actions and made necessary preparatory works for bidding for the project by obtaining necessary clearances from the Ministries concerned, and such timely actions taken by respondent No.3, can by no means be faulted nor can respondent No.1-CSSLR be said to leaked the information of the project to respondent No.3 in advance. The above contention of the petitioners further stands negatived by reason of the fact that respondent No.1-CSSLR considering the pilot project undertaken by NRSA earlier in Nizamabad district held meetings with the officials of NRSA for undertaking the project work and this is evident from the correspondence dated 26.09.2007, 29.11.2007, 30.11.2007, 25.02.2008 and 04.03.2008 entered into, and the meetings held on 08.10.2007, 23.11.2007 and 28.02.2008 by respondent No.1- CSSLR with the officials of NRSA, but however, it appears, which is evident from the record of discussions dated 28.02.2008 that NRSA explained that it will not be possible for them to take up and complete even analog photography for all the five districts in the current flying season and that even doing one now and balance four in next flying season along with five fresh districts will be a difficult task with the present resources available with them. Thus, it is clear that NRSA did not come forward to undertake the project, and in those circumstances it is the case of respondent No.1-CSSLR that they requested the Geological Survey of India to furnish the list of private companies through which they got similar works executed earlier. On the basis of the said list respondent No.1-CSSLR through their Consultant addressed common letters dated 30.11.2007 to the list of 12 companies furnished by Geological Survey of India including one of the petitioners herein, namely M/s. IIC Technologies Pvt. Ltd., clearly informing them that a necessary pre-requisite for the project could be that all the clearances required for the work should be obtained and that the Request for Proposals for the project work would be released shortly and advised them to watch for the release. Thus, it is clear that all the companies interested in the project work were kept informed of the necessary clearances to be obtained for bidding for the project. This apart, it is the specific case of respondent No.1-CSSLR that for the pilot project in Nizamabad district, the aerial photography was conducted by NRSA and the fieldwork was undertaken by respondent No.3 in consortium with M/s. Wipro Infotech Private Limited. At any rate, the learned Advocate General submitted that respondent No.1-CSSLR is even now ready and willing to entrust the work to NRSA if they come forward to undertake the project. In that view of the matter, the petitioners cannot contend that respondent No.1-CSSLR had informed respondent No.3 about the project work in advance, and thereby facilitated respondent No.3 in obtaining the necessary clearances from the Ministries concerned in advance, thereby allowing them to steal a march over other competitors. Admittedly, the petitioners purchased the Request for Proposal. They participated in the pre-bid conference held on 08.02.2008. It is the case of the petitioners that in the pre-bid conference they took objection as to the obtaining of the necessary clearances in time because the policy guidelines of respondent No.2- DGCA, dated 01.05.2006 required making applications six weeks in advance from the proposed date of flying, that too with authority from the State/Central Government, and since there was not much time available at their disposal for getting the required clearances from the Ministries concerned, they requested respondent No.1-CSSLR to extend the time and issue necessary authorization to enable them obtain necessary clearances from the Ministries concerned. Considering the said objections, respondent No.1-CSSLR, vide letter dated 26.02.2008, accorded permission to apply and obtain necessary clearances from Ministry of Defence (MoD) and Director General of Civil Aviation (DGCA) for aerial flying over any or all of the five districts of Ananthapur, Kadapa, Nellore, Srikakulam and Karimnagar, so as to meet the requirements of the Request for Proposal. Because of this, it appears that respondent No.1-CSSLR had changed the tender schedule postponing the dates of opening the pre-qualification bids, technical evaluation bids and commercial evaluation bids. The tender process, which originally was scheduled to be completed on 12.03.2008 was extended to 26.03.2008 to facilitate the petitioners and other competing companies in obtaining the necessary clearances from the Ministries concerned. In fact, on the request made by this Court, the learned Advocate General agreed to extend the time upto 30.04.2008 to enable the petitioners obtain the necessary clearances from the Ministries concerned. However, despite extending the time by the official respondents by postponing the tender schedule before filing the writ petitions itself, and despite this Court extending the time till 30.04.2008, the fact remains, the petitioners unfortunately failed to obtain the necessary clearances from the Ministries concerned. The postponement of the tender schedule dates and extension of time to enable the petitioners obtain necessary clearances from the Ministries concerned, in fact, was for the benefit of the petitioners and certainly not to facilitate respondent No.3 to get the necessary clearances from the Ministries concerned, because much before issuance of the tender notification, namely Request for Proposal, respondent No.3 had in the month of December, 2007 had obtained necessary clearances from the Ministries concerned. In that view of the matter, the petitioners cannot contend that the dates of the tender schedules were postponed to accommodate/facilitate respondent No.3 in obtaining necessary clearances from the Ministries concerned. Though the petitioners placing reliance on the letter dated 03.04.2008 of the Ministry of Defence contend that unless the Government awards contract, the Ministry of Defence would not grant permission to the applicants, and as such, it would be impossible for the petitioners to obtain the necessary clearances from the Ministries concerned, the fact remains, the said letter was issued very recently, and that that too after expiry of the tender process, except its finalization. The petitioners, having failed to get the necessary clearances from the Ministries concerned despite extending time and knowing pretty well that obtaining of such clearances from the Ministries concerned, is a pre-requisite for bidding for the project, now cannot take shelter on the letter dated 03.04.2008 of the Ministry of Defence and contend that it is impossible for them to obtain the necessary clearances from the Ministries concerned, and that respondent No.1-CSSLR knowing fully well about the procedure involved in obtaining necessary clearances from the Ministries concerned, had still framed tender conditions contrary thereto. Though the petitioners contend that as per Clause 1.1(I) formation of consortium and as per Clause 2.3(b) bidders should obtain necessary clearances from the Ministries concerned before they are subjected to pre-qualification; that to accommodate and award the project to respondent No.3, respondent No.1-CSSLR had issued errata deleting Clause 2.3(b), which requires that bidder should have obtained all the required clearances from the Ministries concerned, for aerial photography or should have subsisting contract with a person/firm who had obtained such clearances, evidence of which shall be furnished as part of the pre-qualification proposal and; modified Clause 2.5(a) to the effect that commercial bids will be opened for evaluation only if the bidder or the consortium fulfils – (a) the bidder should obtain the prescribed score as per technical evaluation, (b) the bidder should have obtained and submitted all the required clearance certificates from the relevant ministries for Aerial Photography or should have a subsisting contract with a person/firm who have obtained such clearances, evidence of which shall be furnished, the fact remains, and as stated above, respondent No.3 had obtained necessary clearances from the Ministries concerned, much before issuance of Request for Proposals, and as such, except respondent No.3, no other tenderer was having the qualification to pass through the pre-qualification. However, to accommodate the petitioners and other bidders and to ensure that there is a healthy competition, respondent No.1-CSSLR had deleted Clause 2.3(b), by reason of which, the necessity of obtaining the necessary clearances from the Ministries concerned, at the pre-qualification stage was removed, and in fact, the fulfillment of such requirement was taken to a later stage i.e. considering the bids for commercial evaluation. Though Clause 1.1(I) required formation of consortium before the pre- qualification, the fact remains, by modifying Clause 2.5(a) respondent No.1-CSSLR permitted formation of consortium at the time of considering the bids for commercial evaluation. As stated above, except respondent No.3, no other bidder was having the requisite minimum qualification for bidding, and considering the fact that no one bidder would be allotted work for more than two districts and having regard to the fact that the project work requires varied expertise, respondent No.1-CSSLR permitted formation of consortium at a later stage i.e. at the time of considering the bids for commercial evaluation. By reason of such permission for formation of consortium, it appears respondent Nos. 4 and 5 have entered into an agreement with respondent No.3 for formation of