IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE J.B.KOSHY & THE HONOURABLE MR. JUSTICE P.N.RAVINDRAN MONDAY, THE 7TH JULY 2008 / 16TH ASHADHA 1930 WA.No. 1197 of 2008() -------------------------------- AGAINST THE JUDGEMENT/ORDER IN WPC.33084/2007 Dated 05/02/2008 .................... APPELLANT: RESPONDENTS IN THE WPC ---------------------- 1. THE GENERAL MANAGER, SOUTHERN RAILWAY, CHENNAI. 2. THE DIVISIONAL RAILWAY MANAGER (WORKS), SOUTHERN RAILWAY, THIRUVANANTHAPURAM. BY ADV. SMT.A.RAJESWARI, SC, RAILWAYS RESPONDENTS: PETITIONER IN THE WPC -------------------------- M/S.DELTA GRANITES AND SAND, CHITTAR P.O., PATHANAMTHITTA DIST, REPRESENTED BY ITS MANAGING PARTNER, THOMAS PHILIP. BY ADV. SRI.P.R.VENKITESH THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 07/07/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: J.B.Koshy & P.N.Ravindran, JJ. ===================== W.A.No.1197 of 2008 ===================== Dated this the 7th day of July, 2008. JUDGMENT Koshy,J. In pursuance to Ext.P7 tender notice issued by the second respondent inviting tenders for the work of collection and supply of ballast in Chengannur depot (including loading and unloading), the writ petitioner submitted his tender. As per the eligibility condition, the tenderer has to complete at least one similar single work for a minimum value of 50% of the advertised tender value of work. After completion of the process of pre-qualification and selection, the offer made by the petitioner was accepted by the second respondent (appellant) and the same was conveyed to the petitioner by Ext.P1. The relevant portion of acceptance is as follows: "The letter of acceptance issued is a binding contract between the Railway and the contractor and the date of completion will be reckoned from the date of issue of this letter only and therefore you may please make arrangements to commence the work immediately." 2. The petitioner submitted performance guarantee for Rs.4,55,850/-. The solvency certificate was also produced as can be seen in Exts.P3 and P5. Acting upon Ext.P1, the petitioner has manufactured WA 1197/08 -: 2 :- the track ballast of more than 60% of the volume required for the work and he has acted on the work order issued. Samples were supplied. Ext.P4 report shows that the samples were best and found suitable. Thereafter, the second respondent issued Ext.P6 notice stating that it was advised that the above work had been cancelled due to administrative reasons. We don't know what is the administrative reasons. The reason is not known to him. Before this Court, the reasons stated were not administrative reasons. It is not stated in Ext.P6 that cancellation was due to any mistake or the petitioner was ineligible. It is stated before this Court that the petitioner was only a supplier and not a direct contractor to P.W.D. or K.S.E.B. and that is the reason for cancelling the contract. 3. Ext.P7 is the tender notice. The pre-qualification norms required to be satisfied by the tenderer is the execution of at least one similar single work for a minimum value of 50% of advertised tender value of work in the last three financial years. The work notified is only collection and supply of ballast as the description of the work given in Ext.P1. Apart from the collection and supply of approved quality of machine crushed track ballast, the work also involves loading ballast into railway wagons and coffers by using contractors, labour, etc. and unloading the same as directed by the engineer in-charge of the work. The nature of work only says collection and supply of tract ballast in Chengannur depot and hence what is required to be satisfied by the contractor is WA 1197/08 -: 3 :- completion of at least one work similar to what is notified for the value specified and within the period prescribed. Exts.R2(a) to R(2)(i) certificates produced by the petitioner show that the petitioner is fully eligible. 4. The learned single Judge considered the matter and held as follows: "In my view, the requirements of Ext.P7 or Ext.P1 are fully satisfied by the certificates produced and the inadequacies pointed out are not specified in the tender notice. Exts.R2(a) to R2(i) indicate that the petitioner has supplied similar materials to the contractors concerned. Therefore, these certificates satisfy the requirements of Ext.P7 and it is not the requirement of Ext.P7 that the petitioner should be a direct contractor to P.W.D., Kerala State or K.S.E.B. Thus, the certificates, which were furnished by the petitioner are in full compliance with Exts.P7 and P1. Therefore the theory of mistake now canvassed in the counter affidavit is a totally unfounded one. Necessarily, therefore Ext.P6 issued to the petitioner also cannot be sustained." The writ petitioner has already acted on the basis of acceptance of the tender. The public authority has a duty to act fairly and reasonably. Even though there are inherent limitations in exercising judicial review in contractual matters, power of judicial review can be extended to prevent arbitrariness of if there is also procedural irregularity, wednesbury arbitrariness or manifest error or lack of bonafides. The learned single WA 1197/08 -: 4 :- Judge set aside Ext.P6 as it was arbitrary and lacking in bonafides resulting in manifest error. We fully endorse the view of the learned single Judge. There is no ground to interfere with the impugned judgment. The Writ Appeal is dismissed. J.B.Koshy, Judge. P.N.Ravindran, Judge. ess 19/7