IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH C.W.P. No. 970 of 2008 Date of Decision: 07 .01.2009 SAB Industries Limited ....Petitioner Versus State of Haryana and others ...Respondents CORAM : Hon'ble Mr. Justice J.S. Khehar. Hon'ble Ms. Justice Nirmaljit Kaur Present:- Mr. Akshay Bhan, Advocate for the petitioner. Mr. Surinder K. Bishnoi, D.A.G., Haryana for respondents No.1 to 3. Mr. Surinder Chandna, Advocate for respondent No.4. NIRMALJIT KAUR, J. The petitioner-Company tendered its bid for the work construction of approaches of 2 lane ROB at Charkhi Dadri in lieu of level crossing No.33 in kilometer 54/13-14 on Hisar Rewari Railway line X-ing Jhajjar Dadri road at RD 114.75 in Bhiwani District. All the bids tendered by agencies were opened on fixed date. The petitioner had submitted the tender along with bank guarantee of Rs.34.28 lacs towards earnest money and Rs.10,000/- as bid money. Along with the same, the petitioner also submitted his letter of offer of rebate @ 6% on all “Bill of Quantity” (BOQ) items. The letter is placed on record as Annexure P-2. After submitting the tender, it came to the notice of the petitioner that although rates for item No.3.11 have been correctly mentioned in figure as Rs.45,000/- C.W.P. No. 970 of 2008 -2- per MT and also over all cost has been shown correctly as 2,85,30,000/- (45000 x 634), the rate in words was inadvertently mentioned as Rs.”forty five only” per MT. The petitioner-Company immediately vide letter No.8757 dated 29-11-2007 brought the error to the notice of the Executive Engineer, Public Works Department (B&R), Provl. Division, PWD (B&R) Br., Charkhi Dadri, Haryana and prayed for correction of the bonafide mistake in item No.3.11. The said letter is placed on record as Annexure P-4. However, the clerical mistake, so pointed out by the petitioner, was not allowed to be corrected and the same was rejected by the Chief Engineer (Bridges) Haryana PWD V&R Branch, Chandigarh vide letter dated 11-12-2007 (Annexure P-5). Aggrieved by this rejection, the petitioner-Company approached the Commissioner, PWD (B&R) vide letter dated 17-12-2007 (P-6) for correction of the bonafide mistake. However, instead of allowing the correction, the Superintending Engineer, Haryana, PWD B&R Branch, Bhiwani, vide letter dated 20-12-2007 (Annexure P-7) intimated that the work has already been allotted to the petitioner-Company @ Rs. Forty Five only per MT against item No.3.11. This letter dated 20-11-2007 did not include rebate of 6% of all “Bill of Quantity” (BOQ) items offered by the petitioner while submitting the tender. Not surprisingly, the Chief Engineer substituted the letter of allotment dated 20-12-2007 with another letter which was duly received by the petitioner-Company on 29-12-2007, carrying the same letter No. and date but duly added the rebate of 6% on all “Bill of Quantity” (BOQ) items. The second letter is annexed with the writ petition as Annexure P-8. On receiving the substituted letter, the petitioner immediately, vide his letter dated 02-01-2008, addressed to the Secretary, PWD (B&R), Chandigarh, requested the Secretary to look into the matter that while writing the rate in words against Item no.3.11, the word `thousand' was inadvertently left out which is a patent error on the face of record. In response, much to the dismay of the petitioner-Company, C.W.P. No. 970 of 2008 -3- the order dated 18-01-2008 from respondent No.2, intimating that the bank guarantee of the petitioner, amounting to Rs. 3428,000 (Rupees thirty four lacs & twenty eight thousand only) was being forfeited. This letter/order dated 18-01-2008 (Annexed as P-10) has been impugned by the petitioner in this writ petition. The respondents have filed their written statement. The first objection to the prayer of the petitioner, as raised by State of Haryana is that the rejection of request of the petitioner-Company by the respondents was in accordance with Clause 25.1(a) of the bid document. As per Clause 25.1(a), where there is a discrepancy between the amount in figures and in words, the amount in words will govern. Hence, the rates given in words have been taken into consideration strictly according to Clause 25.2 and 14.6 of bid documents. The second objection, as raised by the respondents is that the contract was awarded to the petitioner-Company, being lowest evaluated bid price and it was required to furnish the performance security within 15 days of the receipt of letter of acceptance and failure to submit the performance security, constitute sufficient ground for cancellation of award and forfeiture of bid security. After hearing learned counsel for the parties and having gone through the different clauses, as relied upon by the respondents to forfeit the bank guarantee, we find that the stand of the respondents is duly mis-conceived and misplaced. The error which was sought to be corrected by the petitioner, was in the rates mentioned in words for item No.3.11, although, it was correctly mentioned in figures as Rs.45,000/- per MT. The rate, in words, was inadvertently mentioned as Rs. “forty five only” per MT. However, overall cost was correctly shown as Rs. 2,85,30,000/- C.W.P. No. 970 of 2008 -4- (45000 x 634). The same is illustrated as below :- S.No. Description of Items Unit Grand Total Rate Rate in words Cost Overall 3.11 Reinforcement: Supply cutting, bending, fixing in position reinforcement of any diameter, TMT as per relevant BIS specifications and drawing in all RCC works of this schedule 3. The rate shall include cost of all material including tying wire, labour, transportation, storing and all other incidental charges, tools and plants etc. Payment shall be made as per theoretical requirement and no wastage shall be paid. Rate shall include all cost. MT 634 45,000 Forty five only Rs.2,85,30,000/- A perusal of the above table shows that the rate in figure was Rs.45,000/- per MT and taking into consideration this amount as Rs.45,000/-, the overall cost was also correctly mentioned. Thus, leaving no doubt that there was an inadvertent error in the mention of the rate in words, whereby, the word `thousand' was inadvertently not mentioned. Not only from the above illustration is it clear that the mistake was an error but it was a bonafide error, amounting to clerical and typographical error. This was further evident from the fact that at four different places in the tender document, the petitioner had correctly mentioned the rate, both in words and figures for the items which were identical to the one described under Item no.3.11. These identical items and their C.W.P. No. 970 of 2008 -5- rates are reproduced below :- S.No. Description of items Unit Rate Rate in words 2.4 Reinforcement : Supply, Cutting, bending, fixing in position reinforcement of any diameter, TMT as per relevant BIS specification and drawing in all RCC/PSC works of this schedule 2. The rate shall include cost of all material including galvanizing/epoxy coating tying wire, labour transportation, storing and all other incidental charges, tools and plants etc. Payment shall be made as per theoretical requirement and no wastage shall be paid. Rate shall include all costs. MT 45000.00 Rs. Forty five thousand only. 4.4 Reinforcement : supply, cutting, bending, with all leads, lifts and depths, fixing in position reinforcement of any diameter, TMT as per relevant BIS specification and drawing in all RCC/PSC works of this schedule 4. The rate shall include cost of all material including galvanizing/ epoxy coating typing wire, binding wire, cover block, provision of stools, chairs, spacer bars, support bars, labour transportation, storing and all other incidental charges, tool and plants etc. complete. Payment shall be made as per theoretical requirement and no wastage shall be paid. Rate shall include all costs. MT 45000 Rs. Forty five thousand only C.W.P. No. 970 of 2008 -6- 5.20 Reinforcement : supply, cutting, bending, with all leads, lifts and depths, fixing in position reinforcement of any diameter, TMT as per relevant BIS specification and drawing in all RCC works of this schedule 5, the rate shall include cost of all material including galvanizing/epoxy coating tying wire, biding wire, cover block, provision of stools, chairs, spacer bars, support bards, labour transportation, storing and all other incidental charges, tool and plants etc. complete. Payment shall be made as per theoretical requirement and no wastage shall be paid. Rate shall include all costs. MT 45000.00 Rs. Forty five thousand only 6.10 Supplying, fitting and placing TMT bar reinforcement complete as per drawing and technical specifications as per MORTH specification 1600, 2200 MT 45000.00 Rs. Forty five thousand only The petitioner had brought the error to the notice of the respondents through the above illustration vide his letters dated 29-11-2007, 17-12-2007 and 02-01-2008, addressed to the Executive Engineer, Public Works Department (B&R), Charkhi Dadri, Haryana, The Commissioner, PWD (B&R) and the Secretary, PWD, respectively. However, the same were ignored in a most mechanical manner without application of mind as to whether, it was a clerical error or not and whether the same was a bonafide mistake. Taking the totality of the above illustrations, we would like to rather go further and state that the rate in words should have been read as `Forty five thousand' instead of `forty five only' even in words due to the reason that the overall cost comes to 2,80,30,000/- only when it is C.W.P. No. 970 of 2008 -7- calculated at the rate of 45,000/-. Moreover, the rate was mentioned as Forty five thousand in words for items of identical description at four different places. The difference in Rs. Forty five and forty five thousand is so huge that to have accepted the rate as Rs. Forty five only, is on the face of it unreasonable, unfair and ridiculous. The very figure of Forty Five in comparison to forty five thousand is a freak number and cannot be feasible. The request of the petitioner- Company, to correct the error, has been rejected, based on Clause 25, which pertains to the correction of error. The same is reproduced here under :- “25. Correction of Errors. 25.1 Bids determined to be substantially responsive will be checked by the Employer for any arithmetic error. Errors will be corrected by the Employer as follows. (a) where there is a discrepancy between the amount in figures and in words, the amount in words will govern; (b) where there is a discrepancy between unit rate and the line item total resulting from multiplying the unit rate by the quantity, the unit rate quoted will govern. 25.2 The amount stated in the bid will be adjusted by the Employer in accordance with the above procedure for the correction of errors and with the concurrence of the bidder, shall be considered as binding upon the bidder. If the bidder does not except the corrected amount the bid will be rejected and the bid security may be forfeited in accordance with sub clause 14.6(b).” This petition deserves to be allowed even from the point of interpretation of Clause 25 which pertains to the correction of error. A reading of Clause 25.1 shows that the aforementioned clause applies only to arithmetical error and not to clerical or typographical error. It is obvious from the above discussion that there is no arithmetical error. In fact, the calculation when made arithmetically i.e. Rs. 45,000 x 634, the total cost C.W.P. No. 970 of 2008 -8- is correctly shown as Rs.2,85,30,000/-. Thus, the clerical error is obvious on the face of it. Hence, the same could not have been processed as per the procedure illustrated in Clauses 25.1, 25.1(a), 25.1(b) and 25.2. as the same applies only to arithmetical error. Thus, the request for correction of Item no.3.11, in terms of the letter dated 29-11-2007 to the Executive Engineer, Public Works Department (B&R), Charkhi Dadri, Haryana, should have been accepted being a clerical, typographical error not covered under Clause 25. In not having accepted the correction, which was purely clerical, the respondents have, in fact caused business lose. The respondents, while rejecting the prayer of the petitioner to correct the clerical error have adopted double standards when it came to correction of an error at their own behest. Without considering the genuine request of the petitioner-Company, the respondents issued an allotment letter to the petitioner-Company dated 20-12-2007, wherein rebate of 6% has offered by the petitioner, was not mentioned. Thereafter, the same letter was substituted vide another letter dated 29-12-2007 with same number and date by inserting the rebate of 6% for item wise rate. This letter was received by the petitioner- Company on 29-12-2007 and the same is annexed as Annexure P-8. The error, as pointed out by the petitioner was also a similar patent error on the face of record and a bonafide human error. No bidder would quote such a ridiculously low rate. Thus, the petitioner should have been allowed to correct this error instead of rejecting the same by mechanically applying Clause 25 of the bid document. The respondents, in this case, have done nothing but taken a very hyper-technical view of the clause and have wrongly applied the same by not permitting the correction which was an error on the face of it and not an arithmetical error. The petitioner, in this regard, has placed reliance on the judgment of this Court in the case of Areva T&D India Limited vs. Power Grid Corporation of India Limited, passed in CWP No. 6820 of C.W.P. No. 970 of 2008 -9- 2008, decided on 13-06-2008, whereby, a similar question, as involved in the present writ petition was decided. In that case, the argument was that only arithmetical error could have been corrected by virtue of provisions of similar clause 23.2 of the Instruction to the Bidder. The clause was interpreted in the following terms:- “ 37. The argument of the learned counsel that only arithmetical errors could have been corrected by virtue of provisions made in clause 23.2 of the Instruction to the bidder and the unit price was to prevail, would not require any detailed consideration. Clause 23.2 of the Instruction to the bidder reads as under :- 23.2 Arithmetical errors will be rectified on the following basis. If there is a discrepancy between the unit price and the total price that is obtained by multiplying the unit price and quantity, the unit price shall prevail and the total price shall be corrected. If the supplier does not accept the correction of the errors, its Bid will be rejected. If there is a discrepancy between words and figures, the amount in words will prevail. 38. A perusal of the aforementioned clause would show that it applies only to arithmetical errors and not to the printing errors. If the aforesaid clause is applied then the printing of `,’ (comma) before the figures of `314,400.00’ would be redundant and there would be absurdity in comparing the Excise Duty and Cess worked out on the basis of printing error. Moreover, clause 23.2 only talks of arithmetical errors and not of printing errors.” It was further observed by the Division Bench that :- “ To err is human and to permit correction of such error is equitable and fair, especially when the mistakes are patent. A public servant who is at the helm of affairs and is competent to permit such corrections may not have undertaken this exercise on account of fear of fastening of responsibility. However, such a thinking cannot be supported because it should also be remembered that such an officer may have to answer such a huge contradictions between the prices of Reactors for C.W.P. No. 970 of 2008 -10- Purnea and Sonepat on the one hand and Siliguri on the other hand. He could be questioned why he has purchased the Reactors for such an exorbitant price for Purnea and Sonepat and how the price is so low for Siliguri. It follows that patent error of the nature which has surfaced in the present case, should have been corrected by the competent officer and this unnecessary litigation could be avoided. It amounts to making hill out of a mole, which is hardly appreciable. It is on account of frivolous litigation of this nature that the projects are delayed, cost is enhanced and inefficiency creeps in. All this was avoidable in the present case. However, the respondent has preferred the course of litigation. Therefore, we find that a strict technical view is not required to be taken because if the bid of the petitioner is not accepted as per corrections then the second lowest bidder would be invited for execution of the contract.” While allowing the writ petition, the Division Bench of this Court, distinguished the judgment of the Hon’ble Supreme Court in the case of West Bengal Electricity Board v. Patel Engineering Co. Ltd., AIR 201 SC 682 and relied on the judgment rendered by Hon’ble the Supreme Court of New Jersey in Spina Asphalt Paving Excavating Contractors, Inc., v. Borough of Fairview 304 NJ Super 425, wherein also, the error was allowed to be corrected which was erroneously mentioned as 400 dollars instead of 4 dollars. It was held that the error in the bid was non-material and subject to waiver. The error was considered as patent and the failure to waive the deviation would thwart the public bidding laws. The present case also is similar to the judgment of this Court passed in CWP No.6820 of 2008 titled as Areva T&D India Limited vs. Power Grid Corporation of India Limited, decided on 13-06-2008 and to the judgment of the Supreme Court of New Jersey in the case of Spina Asphalt Paving Excavating Contractors, Inc. (supra). For the reasons aforementioned, this petition succeeds. Learned C.W.P. No. 970 of 2008 -11- counsel for the petitioner, while making his submission, had restricted his prayer to allow him to withdraw his bank guarantee. The prayer is, accordingly, allowed and the order dated 18-01-2008 (Annexure P-10) is quashed. Accordingly, the respondents are directed to release the bank guarantee of Rs.34,28,000/- of the State Bank of Indore, bearing No.172007-08. We also come to the conclusion that the failure of the respondents to correct a bonafide clerical error which was apparent on the face of it has led to the frivolous litigation. The petitioner shall be accordingly entitled to its cost which is quantified as Rs.50,000/-. (NIRMALJIT KAUR) JUDGE (J.S. KHEHAR) January 07, 2009 . JUDGE gurpreet