WP(C) 1357/2010 BEFORE THE HON’BLE MR JUSTICE B.K. SHARMA 1. The petitioner company is aggrieved by awarding of the contract for supply of Positron Emission Tomography (PET)-CT and Medical Cyclotron on tur nkey basis to the respondent No. 4 by the impugned order dated 15.02.2010 (Annex ure-X). According to the petitioner, the action on the part of the respondent au thority in doing so is unfair, arbitrary, inequitable and illegal. 2. Shortly stated the facts leading to filing of the instant writ petition are that the respondent No. 1 through the respondent No. 2 had issued an invitat ion for bid (Annexure-A) from the intending manufacturer for supply for installa tion of PET-CT and Medical Cyclotron on turnkey basis in Gauhati Medical College & Hospital, Guwahati in the Health and Family Welfare Department specifying the closing date and time for receipt of the bids as 30.10.08 at 1:00 P.M. and open ing of the bids at 2:00 P.M. on the same day. The relevant terms and conditions of the bid are quoted below: 11.04.Prices quoted by the bidder shall be fixed during the bidder’s Performan ce of the contract and not subject to variation on any account. A bid submitted with an adjustable price quotation will be treated as non-responsive and rejecte d, pursuant to clause 24. 16. Period of validity of bids 16.01 Bids shall remain valid for 365 (three hundred and sixty five) d ays after the date of the bid opening prescribed by the purchaser, pursuant to c lause 19. A bid valid for a shorter period shall be rejected by the purchaser as non-responsive. 16.02 in exceptional circumstances, the purchasers may solicit the bid der’s consent to extension of the period of bid validity. The request and the re sponse threto shall be made in writing (or by cable or by telex). The bid securi ty provided under Clause 15 shall also be suitably extended. A bidder may refuse the request without forfeiting its bid security. A bidder granting the request will not be required nor permitted to modify its bid. Section-V: TECHNICAL SPECIFICATION Technical Specification for PET-CT & Medical Cyclotron Sl. No. Technical Specification (i) Scope of the Work: Primary vendor shall be responsible for (ii) Site Preparation: Design, Planning and construction on turnkey basis, adhering to all the prescribed safety guidelines and GMP Regulations. (iii) Supply, Installation, Commissioning and Seamless functioning of the entire system (iv) Any option or added facilities not indicated in the specifications may also be given. Any improve modification or updated version of the system can be included in the quotations (v) Civil Works costs to be quoted separately as per actual requirements for the facility. (i) A latest whole body Positron Emission Tomography System integrated multislice spiral CT Scanner designed for providing volume measurements of metabolic and Physiological process using Positron Emitters, as well as for producing accurate structural and Anatomical fusion images and making attenuation maps for attenuation correction. (ii) The system should have capability for simultaneous data Acquisition, processing, image reconstruction and analysis and fusion of PET with CT images. (iii) The system should operate on 22(–10)V A/C(single phase) 50 HZ or 440 V (– 20) A/C (3 phase) 50 HZ 3. Although the last date of submission of bids was specified as 30.10.08, but vide Annexure-B notice dated 23.10.08 the said last date was extended and it was intimated that the said extended date would be notified later on. 4. In pursuance to the invitation for bid, the representatives of the petit ioner attended the pre-bid meeting held on 15.11.08. According to the petitioner , its understanding was that the Govt. Assam wanted to draw out the most optimum specification of PET-CT Scanner in a fair and transparent manner by ensuring pa rticipation from all major manufacturers. The corrigendum dated 17.11.08 was iss ued by the respondent No. 3 on behalf of the respondent No. 2 changing some of t he terms and conditions mentioned in the original invitation for bids. The petit ioner has specifically mentioned about Clause -B of the said corrigendum and the same is quoted below: B. Page 40 1.1(i) Gantry and detectors: The PET scanner should employ non hygro scopic schintillation material add LSO/LYSO with latest technology for detecti ng 511 KeV gamma photons in coincidence is to be incorporated and delete the sen tence crystal materials with decay rate below 60 nano second and should be ment ioned in the offer 5. According to the petitioner, the said corrigendum with the specification s has been made with a view to eliminate the manufacturer like the petitioner. T he authorized signatories of the petitioner made a communication dated 28.11.08 to the respondent No. 3 expressing its apprehension that the said corrigendum wo uld eliminate the major manufacturer like the petitioner and that the same would further limit the choice having regard to the limited manufacturers of the prod uct. It was further intimated that the GE PET-CT scanner are based on BGO Crysta l Technology that has perfected over the years and BGO Crystal has the best sens itivity which ensures superior image quality and faster scanning with non equiva lent count rate. It was also mentioned in the communication that the General Ele ctric enjoys a 50+% market share worldwide and in India 19 out 27 PET/CT systems are from GE Healthcare. The petitioner sought for editing the specification to enable BGO Crystal enabling the petitioner to make a commercial offering with th eir Discovery VCT only with the latest BGO Crystal. 6. By Annexure-E dated 12.12.2008, it was intimated that the last date of s ubmission of bid was extended upto 17.12.08 at 2:00 P.M. and the bids were to be opened on the same date at 3:00 P.M. The notice further indicated that other te rms and conditions of the invitation for bid and corrigendum would remain unchan ged. The respondent No. 3 by his Annexure-F communication dated 12.12.08 informe d the petitioner that the technical evaluation would be done holistically and af ter looking at the field performance of different PET-CT scan including Cyclotro n. It was further intimated that for not having only a particular type of parame ter would not lead to disqualification if other parameters of the tender were ac hieved. The petitioner was requested to participate in the tender process which was extended upto 2:00 P.M. on 17.12.08. 7. Pursuant to the aforesaid developments, the petitioner submitted its bid and the respondent No. 3 by its communication dated 21.01.09 informed the petit ioner that in the meeting held on 20.01.09 with the Technical Committee, it was observed that the criterion laid down in the specification of the bid documents for purchase of one PET-CT scanner with Cyclotron clearly stated that Crystal ma terial for PET-CT scanner is LSO/LYSO. However, the bid submitted by the petitio ner was BGO based Crystal which was a clear deviation from the specification lai d down. In the communication it was further intimated that to a specific query m ade by Technical Committee, the representatives of the petitioner had answered t hat Discovery RX Units with LYSO Crystals are installed in various selected cent res all over the world (except India) and are made for research and development purpose only and not for commercial use. 8. Accordingly by the said communication the petitioner was asked to substa ntiate the aforesaid statements of the representatives of the petitioner by prov iding a sworn affidavit from the Principals, i.e. GE Healthcare at USA, stating that all PET-CT scanner with LYSO Crystal (Discovery RX) operating in various ce ntres as on today are meant for research and development works only and not for commercial purpose with respective dates of installation and name of the institu tes within 7 days. The petitioner was also directed to furnish a statement that a Medical Physicist for production of FDG shall be available locally in Guwahati as per Tender Document. On perusal of the said communication, the petitioner by its Annexure-H communication dated 29.01.09 apprised the respondent No. 3 that the petitioner has written to their Principals GE Healthcare, USA to furnish dec laration as sought for. The petitioner sought for extension of time till 06.02.0 9 for sending the petitioner’s response as the concerned people were not availab le at their respective locations. Thereafter, the respondent No. 3 by his Annexu re-I communication dated 02.02.09 informed the petitioner that the time was exte nded uptil 06.02.09 for submission of the required documents. It was also indica ted that no further extension would be granted. 9. After the aforesaid developments, the petitioner by its Annexure-J commu nication dated 05.02.09 submitted the response to the aforesaid query made by th e respondents. Alongwith the said communication the petitioner enclosed a copy o f the detailed response from GE Healthcare, USA, i.e. the Principals of the peti tioner. An affidavit was also submitted by the Regional Manager (East) in terms with their response. The respondent No. 2 in response to the said communication dated 05.02.09 made another communication dated 18.02.09 informing the petitione r that the clarification and the affidavit submitted by the petitioner were not in conformity as requested. The petitioner was asked to submit a fresh affidavi t from their Principal mentioning that by their PET-CT scanner with LYSO based C rystal (Discovery RX) operating in various centres as on date were meant for res earch and development purpose only and not for commercial purpose. Such affidavi t was directed to be submitted by 21.02.09. 10. The petitioner by its communication dated 20.02.09 clarified/confirmed t o the respondent No. 3 that during the discussion with Technical Committee on 20 .01.2009 and subsequently through its letter dated 04.02.09, it was explained th at the petitioner has a small number of installation of LYSO Crystal Detector Sy stems under Clinical Research Collaborations and that the systems are being depl oyed by the petitioner to carry out Clinical Research and that collaboration of the petitioner are at liberty to use them for commercial purpose as well. Thus, it was contended that it would be incorrect to say that the systems of the petit ioner are meant for only research and development works and not for commercial p urpose. It was further stated in the said communication that on the basis of the published scientific studies, it was established that BGO is a high performing Crystal material due to its superior sensitivity and noise equivalent count rate . In the said communication assurance was furnished that in case the Technical C ommittee still felt that LYSO Crystal Detector would be considered for purchase, the petitioner was willing to supply the same in lieu of the BGO Crystal Detect or and and as a special case, there will be no change in the pricing of the syst em and the original price bid submitted by the petitioner shall remain unchanged . 11. The petitioner was directed to attend the technical meeting to be held o n 23.02.09 at 11:00 A.M. in the office of the respondent No. 3. According to the petitioner when the aforesaid communications between the parties were on, the P rincipals of the petitioner had launched on commercial basis globally the Discov ery PET-CT 600 series Scanner (Discovery PET-CT 600 and Discovery PET-CT 690) de signed to help and enable early detection and accurate monitoring of the disease . It was further informed that as a special case, the petitioner was willing to supply the Discovery PET-CT 690 in lieu of the Discovery VCT at same price quote d earlier. 12. The respondent No. 3 by its communication dated 24.03.09 asked the petit ioner to submit fresh technical and price bid for purchase of PET-CT scanner wi th cyclotron in turnkey basis to Gauhati Medical College & Hospital. It was fur ther mentioned in the said communication that the earnest money deposited should also be extended accordingly which should be valid for 365 days from the date o f opening of the Technical bids. The petitioner was asked to submit the revised bid on or before 03.04.09 at 1:00 P.M. The other conditions of the invitation fo r bid remained unchanged. 13. The petitioner on receipt of the said communication dated 24.03.09 while expressing gratitude for allowing the petitioner to submit fresh technical pric e bid for PET-CT scanner on turnkey basis by its letter dated 25.03.09 also inti mated that it had offered to supply its latest product Discovery 690 based on LY SO Crystal whereas the respondent No. 4 had offered Biograph 64 True Point inste ad of its latest 64 Row Detector PET-CT scanner system Biograph MCT. Further inf ormation furnished was that the petitioner’s product is 16.5 meV compared to 11 meV of the respondent No. 4. Under such circumstances, the petitioner made a req uest for favourable direction from the Technical Committee in the tender process . 14. In terms of the aforesaid developments, the petitioner submitted its Tec hnical bid on 01.04.09. It was mentioned in the Technical bid that the equipment offered by the respondent No. 4 was much inferior and also obsolete compared to superior and latest equipment offered by the petitioner. 15. The respondent No. 3 by its communication dated 27.04.09 (Annexure-R) in timated both the parties, i.e. the petitioner and the respondent No. 4, that the price bid would be opened on 24.08.09 at 11:00 A.M. and accordingly requested t he parties to depute some senior officials and who can clarify the price bid and take spot decisions on the commercial matter. Pursuant to such opening of the p rice bids, the petitioner submitted yet another letter dated 29.04.09 to the res pondent No. 3 informing of the various mandatory deviations purportedly committe d by the respondent No. 4. It was also stated that taking into account 10 years life cycle cost, the price offered by the petitioner was around one crore less t han that of the respondent No. 4. 16. On receipt of the communication dated 29.04.09 made by the petitioner, i t was informed that same had been forwarded to the Legal Department and that a d ecision in the matter was awaited. According to the petitioner, the respondent h ad shown unresponsive attitude and accordingly the petitioner by its communicati on dated 19.05.09 reminded the respondents of the matter. However, nothing yield ed and the petitioner could come to know that the respondent authority had alrea dy finalized the matter towards allotting the contract to the respondent No. 4. Situated thus, the petitioner invoked the writ jurisdiction of this Court by fil ing a writ petition making a grievance against the proposal for allotment of the contract to the respondent No. 4. The petition was registered and numbered as W .P.(C) No. 2084/09 and the same was disposed of by Annexure- W order dated 03.06 .09 providing that the competent authority would take a decision in the tender p rocess and while doing so should take note of the grievance raised by the petiti oner through their representations. The said order was passed in view of the com munication dated 29.05.09 addressed to the writ petitioner by the respondents in dicating that its representation would be considered in the next meeting by the competent committee constituted for evaluating the tender. 17. After disposal of the writ petition in the above manner, the impugned An nexure-X communication has been made to the petitioner by the respondent No. 3 i ntimating about the approval of the Govt. in the Health and Family Welfare Dep artment regarding procurement and installation of PET-CT with Medical Cyclotron on turnkey basis for Gauhati Medical College and Hospital from the L-1 bidder, i .e. the respondent No. 4. According to the petitioner such a course of action ad opted by the respondents is illegal and in clear violation of the aforesaid orde r dated 03.06.09 passed by this Court providing consideration of the grievance o f the petitioner. It is the stand of the petitioner that the respondents while a warding the contract to the respondent No. 4 did not take into account the point s raised by the petitioner in their representations. It is the stand of the peti tioner that since the respondent No. 4 deviated from requirement of clause 16.1 of the Tender document by not providing bid validity period of 365 days, their b id ought to have been rejected. Be it stated here that the respondent No. 4 had initially provided bide validity of 180 days, but later on increased the same to 365 days. Another contention raised by the petitioner is that the equipment off ered by the petitioner being the latest and the one offered by the respondent No . 4 being inferior and obsolete, the respondents ought not have accepted the bid offered by the respondent No. 4. 18. The respondents have filed their counter affidavits. In the affidavit fi led by the official respondents, the details of sequence of events have been fur nished. It has been stated that the technical committee recommended PET-CT scann er having LSO/LYSO Syntillating material with latest technology for detecting 51 1 Kev gamma photons by way of amendment to the original tender alongwith some ot her amendments and accordingly the corrigendum was also issued. Reacting to the stand of the representatives of the petitioner that the PET-CT scanner with LYSO Crystal of Wipro GE are not installed anywhere in the world for commercial pur pose, the respondents insisted for substantiation of the same by the petitioner through a sworn affidavit from the Principals of GE (Medical), USA. However, the petitioner did not comply with the same and instead stated only the finer point s of BGO Crystal technology. Although the petitioner failed to substantiate its claim that PET-CT scanner are not available for commercial purpose, but they wer e given another opportunity to confirm the same by submitting the affidavit fixi ng the date of submission on 21.02.09. 19. Reacting to the statement made in paragraph-17 of the writ petition that it would be incorrect to say that the systems are meant for only research and development works and not for commercial purpose it has been stated by the resp ondents that such a statement has been made only in the writ petition, but the p etitioner failed to state the same by sworn affidavit as was directed. The respo ndents have objected this particular statement which according to them is contra ry to the earlier stand of the petitioner. It has also been stated that the peti tioner delayed the matter considerably and it was only at a later stage it decla red that it would be able to supply LYSO based PET-CT scanner. 20. As regards the plea of the petitioner that the price offered by it has t aken into account 10 years life cycle cost, the respondents have stated that sam e is not correct because the price are inclusive of 5 years warranty, installati on, commissioning, manpower (a physicist, a chemist) for operation of cyclotron and chemist lab and consumables for 5 years. According to the respondents, same criteria were applied for respondent No. 4. As regards the plea of the petitione r that the respondents having not offered price validity for 365 days, it has be en stated that as per the advice of the purchase committee such validity period has been obtained from the respondent No. 4. 21. In the counter affidavit filed by the respondent No. 4 also, the content ions raised in the writ petition have been denied. It is the stand of the respon dent No. 4 that the competent authority taking into account all the relevant fac ts and circumstances has rightly warded the contract to the respondent No. 4 and the petitioner should not make any grievance against the same. The petitioner h as also filed an affidavit in reply to the affidavit filed by the respondents. I n the affidavit so filed, the stand of the petitioner in the writ petition has b een reiterated. 22. I have heard Mr. D. Baruah, learned counsel for the petitioner as well a s Mr. D. Saikia, learned Standing counsel, Health Department. I have also heard Mr. S. Talukdar, learned Sr. counsel assisted by Mr. I. Lahiri, learned counsel for the respondent No. 4. I have also considered the entire materials on record. 23. Mr. Baruah, learned counsel for the petitioner upon a reference to the e ntire materials on record, submitted that the respondents inspite of its underta king that the representation submitted by the petitioner would be considered and the earlier writ petition having been disposed of by taking note of the said un dertaking, the respondents acted illegally and arbitrarily in not taking into ac count the said representation towards awarding the contract to the respondent No . 4. Referring to Clause 16.01 of the Tender document which provides that bid wo uld remain valid for 365 days after the date of bid opening prescribed by the p urchaser and that bid valid for a shorter period shall be rejected by the purcha ser as non-responsive, Mr. Baruah, learned counsel for the petitioner submitted that the respondent No. 4 having submitted the bid with validity period of 180 d ays, its bid ought to have rejected at the very threshold. According to him, the equipment provided by the respondent No. 4 being inferior in quality and obsole te and the one provided by the petitioner being latest, the respondent ought not to have accepted the bid offered by the respondent No. 4. 24. Mr. D. Saikia, learned Standing counsel, Health Department countering th e above argument advanced by Mr. Baruah, submitted that the respondents have tak en a very fair decision in the matter and at every stage duly considered the rep resentations made by the petitioner. As regards the controversy relating to the bid validity period which is stated to be lesser than the one fixed in the bid d ocuments, Mr. Saikia, learned Standing counsel, Health Department upon a referen ce to Clause 24.06 of the Tender document, submitted that the purchaser has a ri ght to waive any minor infirmity or non-conformity or irregularity in a bid whic h does not constitute a material deviation. By referring to the records produced by him containing the decision making process, he submitted that in absence of any allegation of malafide and colourable exercise of power in the decision maki ng process, the writ court will be reluctant to sit on appeal over the findings arrived at by the expert committee constituted for the purpose of awarding the contract. He has placed reliance on the following decisions: 1) (1991) 3 SCC 273 (Poddar Steel Corporation vs. Ganesh Engineering Works & ors.) 2) (2006) 11 SCC 548 (BSN Joshi & Sons Ltd. vs. Nair Coal Services Ltd. & others) 25. Mr. S. Talukdar, learned Sr. counsel for the respondent No. 4 adopting t he argument advanced by Mr. Saikia, learned Standing counsel, Health Department, submitted that the deviation in respect of bid validity period from 365 days to 180 days was a minor variation and as per the provision of Clause 24.06 and 24 .07 of the Tender document, such a minor deviation is within the competence and jurisdiction of the competent authority to be waived. Clause 24.07 provides that the purchaser’s determination as to the substantial responsiveness or otherwise of each bid or consideration of a minor informality or non-conformity or irregu larity is final and conclusive. He has also placed reliance on certain decisions which are as follows: 1) (1994) 6 SCC 651 (Tata Cellular vs. Union of India) 2) (2009) 6 SCC 171 (Meerut Development Authority vs. Association of Management Studies & anr.) 3) (2000) 2 SCC 617 (Air India Ltd. vs. Cochin International Airport & others) 4) (2007) 14 SCC 517 ( Jagdish Mandal vs. State of Orrisa) 26.