IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) TUESDAY, THE SIXTH DAY OF OCTOBER TWO THOUSAND AND NINE PRESENT HON'BLE MS JUSTICE G.ROHINI WRIT PETITION No.3111 of 2009 Between: Jyothirmayi DWCUA Mhila Podupu Sangam, Rep. By its Secretary, Yaddanapudi Vijaamma. … Petitioner And 1. Municipal Corporation of Guntur, Rep.by its Commissioner, Guntur. 2. The Municipal Health Officer, Municipal Corporation of Guntur, Guntur. 3. The Mayor, Municipal Corporation of Guntur, Guntur. … Respondents The Court made the following: HON'BLE MS JUSTICE G.ROHINI WRIT PETITION No.3111 OF 2009 ORDER: - The first respondent- Municipal Corporation, Guntur issued a tender notice dated 07.01.2009 inviting sealed tenders from eligible societies or DWCUA Groups for execution of sanitation work in different divisions of the Municipal Corporation for a period of 12 months from 01.02.2009 to 31.01.2010. In response to the same, the writ petitioner which claims to be a registered DWCUA group submitted its bid in respect of package No.57 relating to sanitary division No.25. Another society by name Padma Mahila Podupu Sangam had also submitted its bid for package No.57. The tenders were opened on 27.01.2009 and it was found that the petitioner society had quoted 2% less while the other society quoted 1% less over the estimate value. While the petitioner was under an impression that the work order would be issued to it, since its bid was the lowest, the Corporation published a fresh tender notice dated 09.02.2009 inviting tenders for the very same package No.57. Aggrieved by the same, the present writ petition is filed seeking a declaration that the tender notice dated 09.02.2009, is arbitrary, illegal and consequently direct the respondents to accept the petitioner’s bid pursuant to the earlier tender notice dated 07.01.2009 and issue work supply order for package No.57. It is primarily contended by the petitioner that its bid being the lowest, the Corporation is bound to accept the same and the supply order ought to have been issued in its favour. It is contended that the impugned action of the respondents in canceling the tender itself without assigning any reasons and publishing a fresh tender notice is arbitrary, illegal and contrary to the procedure prescribed under the Municipal Corporation of Hyderabad Tender Rules, 1970. In the counter-affidavit filed on behalf of the Guntur Municipal Corporation, the fact that the petitioner was the lowest bidder pursuant to the tender notice dated 07.01.2009 has not been disputed. However, it is stated that on verification of the certificates submitted by the petitioner, it was found by the Scrutiny Committee (UPACELL) that the petitioner had failed to maintain regular savings in the bank as required under the guidelines issued by the Government of A.P. governing self help groups. As such, the petitioner was found to be ineligible for entrusting the sanitation work and accordingly, a fresh tender notice was issued on 09.02.2009. It is claimed that before issuing the fresh tender notice dated 09.02.2009, a notice was put up in the notice board in the first respondent’s office stating that the petitioner whose bid was the lowest was ineligible for entrusting the sanitation work, since it failed to comply with the guidelines issued by the Government of A.P. Thereafter, in response to the petitioner’s representation dated 11.02.2009, the said fact was again informed to the petitioner. That apart, the Corporation is empowered to cancel the tender without assigning any reason as per condition No.1 of the tender notice dated 07.01.2009. In the circumstances, the impugned action of the Corporation in issuing a fresh tender notice cannot be held to be arbitrary or illegal on any ground whatsoever. I have heard the learned counsel for both the parties and perused the material on record. As per condition No.1 of the tender notice dated 07.01.2009, all rights are reserved by the Commissioner, Municipal Corporation of Guntur, to reject any or all the tenders without assigning any reasons. However, the law is well settled that such a clause does not give an arbitrary power to the tender inviting authority. It has been held in a catena of decisions that such a power has to be exercised to achieve the object for which the clause has been incorporated in the tender notice and the decision shall be taken bonafide. From the stand taken by the respondents in the counter-affidavit, it is clear that the tender notice dated 07.01.2009 was cancelled on the ground that none of the bidders was eligible as per the guidelines for entrustment of the sanitation works. So far as the writ petitioner is concerned, the allegation was that the petitioner had failed to maintain regular savings in the bank as required under the guidelines. However, the said allegation has been denied by the writ petitioner in its reply affidavit stating that while issuing the tender schedule itself, the eligibility of the petitioner was verified and the Corporation was satisfied that the petitioner’s society was maintaining regular savings in the bank. In support of the said plea, the petitioner has placed before this court the certificate given by the project officer, UPACELL Municipal Corporation, Guntur dated 20.01.2009, certifying that the petitioner has been maintaining regular savings in the bank and that it is conducting group meetings every month and that the loan given by the Corporation has also been repaid as per the schedule. In the light of the said certificate, the stand taken by the respondents that the petitioner was ineligible for entrustment of the sanitation work appears to be factually incorrect. Since no other ground could be made out by the Corporation to show that the petitioner was ineligible for entrustment of the sanitation work, I am of the opinion that the matter requires reconsideration by the first respondent corporation. In the circumstances, the fresh tender notice dated 09.02.2009, which is impugned in this writ petition so far as it relates to package No.57 is concerned, is hereby set aside and the writ petition is disposed of with a direction to the 1st Respondent, to reconsider the tender submitted by the petitioner in response to the tender notice dated 07.01.2009 after giving an opportunity to it to meet the alleged non compliance with the guidelines, and pass appropriate orders in accordance with law as expeditiously as possible preferably within a period of four weeks from the date of receipt of a copy of this order. Writ petition is accordingly disposed of. There shall be no order as to costs. _______________ (G.ROHINI, J) 06.10.2009. Lmv