THE HON’BLE SRI JUSTICE K.C.BHANU WRIT PETITION No. 26628 OF 2011 ORDER : 1. This Writ Petition is filed seeking to issue a writ of mandamus declaring the action of the respondents 1 to 3 in accepting and evaluating price bid of the fourth respondent in respect of the work ‘widening to 2 lane and improvement of Yellandu-Gundala road from KM 0/0 to 51/6’ notified vide Tender Notice No.1/LWE/CE/PPP/ 2011, dated 17.6.2011, is in violation of Clause 18 of the Standard Bidding Document and Addendum- III and consequently direct the respondents 2 and 3 to reject the bid submitted by the fourth respondent. 2. The averments, in brief, of the affidavit filed in support of the Writ Petition may be stated as follows: The second respondent issued a tender notice dated 17.6.2011 inviting bids in respect of five works mentioned therein, and the issue involved herein relates to the work mentioned at serial no.2 thereof i.e. ‘widening to 2 lane and improvement of Yellandu-Gundala road from KM 0/0 to 51/6’. Along with the bid documents, in addition to the standard bid documents, the respondent supplied three Addendums, and as per Addendum-III , the bids shall be in hard bound form with proper index and page numbers and all the pages shall be signed/self-attested by the authorized representative of the bidder duly sealing and marking to be done while submitting the bids, so as to fulfil the condition of standard bidding document, and it is stated that if the condition is not complied the bids will be summarily rejected. The petitioner submitted its bid duly complying with all formalities, and the fourth respondent also submitted its bid. In all, 11 tenders were received in response to the tender notice, and three bidders were disqualified at the stage of Technical Bid itself as bids were not in bounded form. Price bids were opened on 9.9.2011 and at that time, it is noticed that the bid of the fourth respondent was submitted in loose sheets with a tag and was not hard bound in accordance with Addendum-III and the same was objected by the petitioner’s representative which was recorded in the minutes at the time of opening of the bids. The said Addendum was issued to overcome the allegations and complaints that the papers are being replaced in the bid document and the same is mandatory and no deviation therefrom is permissible. But, respondents 2 and 3, instead of rejecting the bid of respondent no.4, have not only accepted the same but also evaluated the same and declared it as first lowest bidder. On coming to know about the same, petitioner sent letter dated 14.9.2011 to the second respondent, but there is no response thereto. Hence, the Writ Petition. 3. The third respondent filed counter affidavit denying the averments made in the writ affidavit and stating inter alia as follows: Detailed evaluations of the technical bids were taken up and Technical Evaluation Committee headed by the Chief Engineer (R&B) had examined the technical bids on 22.8.2011 and submitted to the Screening Committee headed by the Chief Engineer-MORT&H, New Delhi, and there were no complaints and representations on the above process. The fourth respondent submitted the tender bid in hard bound form as per Addendum-III and as per Clause 18. Price bids were opened on 9.9.2011 and the bid prices quoted by the bidders were read out. There were no complaints or representations on the above process at any state either by the disqualified bidders or the petitioner. Representative of the bidders had also attended the opening of the technical as well as price bids, but no objections were received. In the meeting of the Screening Committee, price bids submitted in stapled form by some of the bidders was discussed in detail and keeping in view of the fact that the price bids BOQ has been furnished on prescribed format and the bids are without any material deviation or reservations as stipulated in bidding document, bids were considered substantially responsive. Further, the financial bid documents were prepared by the department in stapled booklet form with page numbers signed by the third respondent in original, the question of hard binding of same again by bidder does not arise. Each and every page of the financial bids of all the bidders was signed by the members of the evaluation committee present at the time of opening of the price bids. The petitioner’s representative had not raised any objections during the opening of price bids even regarding proceedings taking place at the time of the openings. The fourth respondent had become L1 bidder with bid amount of Rs.72,35,14,546.49 ps. All the issues raised by the petitioner were already discussed in detail during Evaluation Committee Meetings and Screening Committee Meetings, and the representative who attended the openings had never raised any objection during the above process. Hence, it is prayed to dismiss the Writ Petition. 4. The fourth respondent filed counter affidavit denying the averments made in the writ affidavit and stating inter alia as follows: This respondent submitted its technical bid in hard bound form, and the price bid was submitted as a stapled booklet as was given to it. The technical bid is submitted in hard bound form to avoid any future allegation regarding interpolation of documents to be enclosed to the technical bid. However, price bid is required to be submitted to the Employer as it is without any annexures/documents after duly filling up rates in the bill of quantities, and it is duly paginated and signed by the Employer on all the pages and therefore there is no scope for any controversy later with regard to actual contents of it. The petitioner did not raise any objection with regard to submission of the price bid by this respondent in stapled booklet form. All were present at the time of opening of the price bids and soon after the opening, the Employer signed on all pages in the presence of other tenderers. So, submission of price bid in the form of stapled booklet and not in bound form, neither leads to any scope for manipulation nor resulted in any prejudice to either the employer’s interest or to the interest of co-tenderers. Insistence of compliance to Addendum-III to Clause 18 is not mandatory, in the case of a price bid and the Employer has the discretion to waive the same by treating it as a procedural aberration if the bid is otherwise in order and serves public interest. Hence, the Writ Petition is liable to be dismissed. 5. Learned counsel for the petitioner contended that in violation of the tender notice conditions, bid of the fourth respondent was accepted; that, admittedly, the fourth respondent submitted the price bid in a stapled booklet form as against the required condition of hard bound form; that, as the price bid submitted by the fourth respondent was submitted in loose sheets with a tag and was not hard bound, the bid has to be rejected, and so, there is arbitrary and unreasonable action on the part of the official respondents in accepting the price bid of the fourth respondent. 6. On the other hand, the learned Government Pleader for Roads & Buildings appearing for the respondents 1 to 3 contended that the price bid of the fourth respondent is in prescribed format and as there are no material deviations as stipulated in the bid documents, the Evaluation Committee accepted the price bid of the fourth respondent and this aspect of the case has been completely taken into consideration by the Evaluation Committee and therefore are no grounds to interfere with the same. 7. The learned counsel appearing for the fourth respondent contended that the fourth respondent submitted the price bid in stapled booklet form as was given by the official respondents; that, the price bid is duly paginated and signed by the Employer in all the pages and the petitioner did not raise any objection with regard to submission of price bid in stapled booklet form; that in pursuance of the agreement, fourth respondent has commenced the work and incurred huge expenditure for the purpose of execution of works, and hence, he prayed to dismiss the Writ Petition. 8. The short point that falls for consideration in this Writ Petition is ‘whether the bid documents submitted by all the tenderers are in accordance with tender conditions and whether the price bid document submitted by the fourth respondent which is admittedly in stapled booklet form is a proper compliance as per the tender requirements ? 9. Issuance of Tender Notice dated 17.06.2011 inviting bids in respect of works, including ‘widening to 2 lane and improvement of Yellandu-Gundala road from KM 0/0 to 51/6’, is not in dispute. In pursuance of the notice for invitation of tenders, in addition to the Standard Bidding Documents, the respondents supplied three Addendums. It is also not in dispute that as per the Addendum-III, bids shall be in the hard bound form with proper index and page numbers and all pages shall be signed/self-attested by the authorized representative of the bidder duly sealing and marking to be done while submitting the bids. It is also not in dispute that there are two important stages in evaluation of the bidding process. The first stage is evaluation of the technical bid. It is not in dispute before this Court that the fourth respondent submitted the technical bid in hard bound format. As per the technical bid, the tenderer has to fill up several forms and annexures as required in the bid and also submit various documents viz. financial credentials, work experience certificate, balance sheet, list of equipment owned by it. The object of the hard binding of the bid document relating to technical bid is to avoid replacing of any important papers at any time and also to avoid any future litigation. At the second stage i.e. price bid, there is no need to append any documents to the price bid. What all the bidder has to do is to fill up the columns with rates. It is also not in dispute that the price bid given by the tenderer is to be duly paginated and has to be signed by the Employer on all the pages, so that there will not be any scope for any controversy later stage with regard to the price quoted by the tenderer. 10. It is not in dispute that the tenders submitted by the tenderers in pursuance of the aforesaid Tender Notice were opened in the presence of all the persons concerned. They were in the sealed covers. Seals of the price bids were opened in the presence of all the tenderers or their representatives. Though it is stated that representative of the petitioner raised objection with regard to the price bid submitted by the fourth respondent in stapled form, but not in hard bound format, the respondents contended that no such objection was taken by the petitioner at the time of opening of the sealed covers relating to the price bid. According to the case of the fourth respondent, the price bid document was submitted by the Department in a stapled form and he accordingly filled the columns by quoting the price and that the representative of the fourth respondent has signed on every page of the price bid document. It is not the case of the petitioner that the officials manipulated or meddled with the price quoted by the fourth respondent in the price bid or that the price bid was not signed by the authorized representative of the fourth respondent. 11. Addendum-III to the Tender Notice deals with ‘submission of bids in Hard Bound form (clause 18 page 16 of Standard Bid Document), which reads as follows: “The bids in hard bound form with proper index and page numbers & all pages shall be signed/self-attested by the authorized representative of the bidder duly sealing and marking to be done while submitting the bids, so as to fulfil the condition of the Standard Bidding Document. If the condition is not complied, Bids will be summarily rejected.” The contention of the learned counsel for the petitioner is that the price bid submitted by the fourth respondent is not in hard bound format. According to the learned counsel, three bids submitted by the bidders were rejected at the stage of evaluation of the technical bid on the ground that the bids were not in hard bound format, and therefore, it is contended that as the price bid was not in hard bound format, it has to be rejected by the Evaluation Committee and therefore there is arbitrary action on the part of the official respondents. 12. With regard to the scope of judicial review in the matters relating to tenders, the learned counsel for the petitioner placed reliance on a decision in Sorath Builders v. Shrerejikrupa Buildcon Limited & another[1], wherein it is held thus: (para 27) “Following the aforesaid legal principles laid down by this Court, we are of the considered opinion that the respondent no. 1 was negligent and was not sincere in submitting his pre- qualification documents within the time schedule laid down despite the fact that he had information that there is a time schedule attached to the notice inviting tenders. Despite being aware of the said stipulation he did not submit the required documents within the stipulated date. Pre- qualification documents were received by the respondent no. 2 - University only after time schedule was over. The terms and conditions of the tender as held by the Supreme Court are required to be adhered to strictly, and therefore, the respondent no. 2 - University was justified in not opening the tender submitted by respondent no. 1 on 01.12.2008, which was late by three days. According to us no grievance could also be made by the respondent no. 1 as lapse was due to his own fault. The High Court proceeded to interfere with the entire process as if acting as an appellate authority over the decision of the University which was beyond the jurisdiction of the Court. The High Court was not justified in accepting the contentions of respondent no. 1 and thereby upsetting the entire process of inviting tenders by interfering with the terms and conditions of inviting the tenders and by "escheduling and directing the process of re-tendering, which would only cause further delay and would increase the burden on the exchequer of the University.” No doubt, it is clearly stated that the terms and conditions of the tender are required to be adhered to, strictly. But, it is a case where the pre-qualification documents have not been submitted within the stipulated date. Therefore, that decision has no application to the facts and circumstances of the case on hand. 13. The learned counsel for the petitioner also relied on the following decisions. (a) in Master Marine Services (P) Limited v. Metcafe & Hodgkinson (P) Ltd & another[2], wherein it is held thus: (para 15) “The law relating to award of contract by State and public sector corporations was reviewed in Air India Ltd. v. Cochin International Airport Ltd. and it was held that the award of a contract, whether by a private party or by a State, is essentially a commercial transaction. It can choose its own method to arrive at a decision and it is free to grant any relaxation for bona fide reasons, if the tender conditions permit such a relaxation. It was further held that the State, its corporations, instrumentalities and agencies have the public duty to be fair to all concerned. Even when some defect is found in the decision making process, the Court must exercise its discretion- ' ary powers under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The Court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the Court should interfere.” (b) in Narendra Kumar Maheshwari v. Union of India & others[3] wherein it is held thus: (para 69). “Shri Ganesh submitted that the CCI is duty bound to act in accordance with the guidelines which lay down the principles regulating the sanction of capital issues. This is especially so because the guidelines had been published. It was submitted that the investing public is, therefore, entitled to proceed on the basis that the CCI would act in conformity with the guidelines and would enforce them while sanctioning a particular capital issue. It was submitted that it is not permissible to deviate from the guidelines. In this connection, reliance was placed by him as well as by Shri Haksar, appearing for the petitioner in T. C. No. 1611/88, upon the observations of this Court in Ramanna Dayaram Shetty v. International Airport Authority, (1979) 3 SCR 1014: (AIR 1979 SC 1628), where this Court observed that it must be taken to be the law that where the Government is dealing with the public, whether by way of giving jobs or entering into contracts or issuing quotas or licence or granting other forms of largess, the government could not act arbitrarily at its sweet will and, like a private individual, deal with any persons it pleases, but its action must be in conformity with standard or norm which is not arbitrary, irrational or irrelevant. We accept the position that the power of discretion of the government in the matter of grant of largess including award of jobs, contracts, quotas, licences etc. must be confirmed and structured by rational, relevant and non-discriminatory standard or norm and if the government departed from such standard or norm in any particular case or cases, the action of the government would be liable to be struck down, unless it could be shown by the government that the departure was not arbitrary but was based on some valid principle which in itself was not irrational, irrelevant, unreasonable or discriminatory. Mr. Haksar drew our attention to the observations of this Court in the case of Motilal Padampat Sugar Mills v. State of Uttar Pradesh, (1979) 2 SCR 641 : (AIR 1979 SC 621), where this Court reiterated that claim of change of policy would not be sufficient to exonerate the government from the liability; the government would have to show what precisely was the changed policy and also its reason and justification so that the Court could judge for itself which way the public interest lay and what the equity of the case demanded. It was contended by Shri Haksar that there were departures from the guidelines and there was no indication as to why such departures had been made.” (c) in Air India Limited v. Cochin International Airport Ltd. & others[4] wherein it is held thus: (para 7). “The law relating to award of a contract by the State, its corporations and bodies acting as instrumentalities and agencies of the Government has been settled by the decision of this Court in R. D. Shetty v. International Airport Authority, (1979) 3 SCC 498 : (AIR 1979 SC 1628); Fertilizer Corporation Kamgar Union v. Union of India, (1981) 1 SCC 568 : (AIR 1981 SC 844); Asstt. Collector, Central Excise v. Dunlop India Ltd., (1985) 1 SCC 260 : (AIR 1985 SC 330); Tata Cellular v. Union of India, (1994) 6 SCC 651 : (1994 AIR SCW 3344 : AIR 1996 SC 11); Ramniklal N. Bhutta v. State of Maharashtra, (1997) 1 SCC 134 : (1997 AIR SCW 1281 : AIR 1997 SC 1236) and Raunaq International Ltd. v. I.V.R. Construction Ltd., (1999) 1 SCC 492 : (1999 AIR SCW 53 : AIR 1999 SC 393). The award of contract, whether it is by a private party or by a public body or the State, is essentially a commercial transaction. In arriving at a commercial decision considerations which are of paramount are commercial considerations. The State can choose its own method to arrive at a decision. It can fix its own terms of invitation to tender and that is not open to judicial scrutiny. It can enter into negotiations before finally deciding to accept one of the offers made to it. Price need not always be the sole criterion for awarding a contract. It is free to grant any relaxation, for bona fide reasons, if the tender conditions permit such a relaxation. It may not accept the offer even though it happens to be the highest or the lowest. But the State, is corporations, instrumentalities and agencies are bound to adhere to the norms, standards and procedures laid down by them and cannot depart from them arbitrarily. Though that decision is not amenable to judicial review, the Court can examine the decision making process and interfere if it is found vitiated by mala fides, unreasonableness and arbitrariness. The State, is corporations, instrumentalities and agencies have the public duty to be fair to all concerned. Even when some defect is found in the decision making process the Court must exercise its discretionary power under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The Court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the Court should intervene.” (d) in Raunaq International Ltd. v. I.V.R. Construction Ltd. & others,[5] wherein it is held thus: (para 22) “In Tata Cellular v. Union of India, (1994) 6 SCC 651 : (1994 AIR SCW 3344), this Court again examined the scope of judicial review in the case of a tender awarded by a public authority for carrying out certain work. This Court acknowledged that the principles of judicial review can apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favouritism. However, there are inherent limitations in the exercise of that power of judicial review. The Court also observed that the right to choose cannot be considered as an arbitrary power. Of course, if this power is exercised for any collateral purpose, the exercise of that power will be struck down. "Judicial quest in administrative matters has been to find the right balance between the administrative discretion to decide matters and the need to remedy any unfairness. Such an unfairness is set right by judicial review." After examining a number of authorities, the Court concluded as follows:- (1) The modern trend points to judicial restraint in administrative action. (2) The Court does not sit as a Court of appeal but merely reviews the manner in which the decision was made. (3) The Court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise, which itself may be fallible. (4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. (5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative or quasi-administrative sphere. However, the decision can be tested by the application of the "Wednesbury principle" of reasonableness and the decision should be free from arbitrariness, not affected by bias or actuated by mala fides. (6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure.” (e) in W.B. State Electricity Board v. Patel Engineering Co. Ltd. & others[6], wherein it is held thus: (para 27) “Exceptions to the above general principle of seeking relief in equity on the ground of mistake, as can be culled out from the same para,