IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE ANTONY DOMINIC THURSDAY, THE 5TH FEBRUARY 2009 / 16TH MAGHA 1930 WP(C).No. 36527 of 2008(W) -------------------------- PETITIONER(S): --------------- KOTTARAKKARA PUBLIC WORKS SKILLED WORKERS LABOUR CONTRACT CO-OPERATIVE SOCIETY LTD., Q- 459, KOTTARAKKARA, REPRESENTED BY THE SECRETARY, DEEP DAVID. BY ADV. SRI.T.V.AJAYAKUMAR RESPONDENT(S): --------------- 1. STATE OF KERALA, REPRESENTED BY THE SECRETARY TO GOVERNMENT PUBLIC WORKS DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM. 2. EXECUTIVE ENGINEER, P.W.D. ROADS DIVISION, KOLLAM. 3. ASISTANT EXECUTIVE ENGINEER, ROADS SUB DIVISION, KOTTARAKKARA. 4. P.C. SAJI, MADATHINPADIKKAL HOUSE, K.S. MANGALAM, VAIKOM, KOTTAYAM. GOVERNMENT PLEADER SRI. P.N. SANTHOSH FOR R1 TO 3 SRI.R.V.SREEJITH FOR R4 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 05/02/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) No. 36527/2008 APPENDIX PETITIONER'S EXHIBITS: EXHIBIT P1 : TRUE COPY OF THE GOVERNMENT ORDER NO. G.O. (MC) 135/97/CO-OP. DATED 13.11.1997 EXHIBIT P2 : TRUE COPY OF THE NOTIFICATION R.O.NO. 450/G1/08PR PUBLISHED IN KERALA KAUMUDI DAILY DATED 26.11.2008. EXHIBIT P3 : TRUE COPY OF THE WRITTEN SUBMISSION DATED 4.12.2008 OF THE PETITIONER TO THE 3RD RESPONDENT. EXHIBIT P3(A) : TRUE COPY OF THE RECEIPT DATED 4.12.2008 ISSUED TO THE PETITIONER FROM THE POST OFFICE. EXHIBIT P4 : TRUE COPY OF THE GOVERNMENT ORDER DATED 10.2.1995. RESPONDENT'S EXHIBITS: EXHIBIT R4(a) : TRUE COPY OF THE AGREEMENT ENTERED INTO BY THE 4TH RESPONDENT WITH THE 2ND RESPONDENT DATED 11.12.2008. EXHIBIT R4(b): TRUE COPY OF THE PORTION OF THE PWD MANUAL. EXHIBIT R1(a) : TRUE COPY OF THE NOTICE NO. D5.995/08-09 DATED 9.12.2008. EXHIBIT R1(b) : A TRUE COPY OF THE AGREEEMTN NO. 101/AEEK/08-09 DATED 11.12.2008 EXHIBIT R1(c) : A TRUE COPY OF THE AGREEMENT REGISTER. //TRUE COPY// P.A. TO JUDGE. ANTONY DOMINIC, J. --------------------------- W.P.(C) No. 36527 of 2008 ------------------------------------ Dated this the 5th day of February, 2009 JUDGMENT The petitioner is a Labour Contract Co-operative Society. Exhibit P1 is an order issued by the first respondent, providing preferences in the matter of awarding contracts to Societies like the petitioner. Clause 8 of Exhibit P1 provides the procedure and conditions for award of contract to such Societies. Clause 8(b) being relevant, is extracted below for reference; “In cases where a private contractor has quoted the lowest rate, the Labour Contract Co-operative Society which has quoted for the work will be given preference in awarding contracts as follows: (1)when the lowest tender is from a private contractor, the Labour Contract Co-operative Society will be awarded the work at 10% above the lowest tender, if the Society is willing to do the work. The work Awarding Authority should ascertain the willingness of the Labour W.P.(C) No. 36527/2008 2 Contract Society in writing.” 2. A reading of Clause 8(b)(1) shows that if a private contractor has submitted the lowest tender, the Labour Contract Society is entitled to be awarded the work, provided it is willing to do the work. It is also the obligation of the awarding authority to ascertain the willingness of such Society in writing. 3. While Exhibit P1 Government order is still in vogue, by Exhibit P2, tenders were invited by the first respondent, which included the urgent patch works and repairs to Cheerankavu-Puthur Road. Notice also shows the Probable Amount of Contract was Rs. 3,00,000/-. 4. From the Counter affidavit filed by respondents 1 to 3, it would appear that they had received five tenders including that of the petitioner. It is stated that the 4th respondent who had quoted 25% below the estimated rate, was the lowest tenderer and the petitioner had quoted 5% above P.A.C. 5. According to the petitioner, on the date of opening of the price bid, when the petitioner realised that the 4th respondent was the lowest tenderer, petitioner attempted to express its willingness to take W.P.(C) No. 36527/2008 3 up the work and submitted Exhibit P3 letter to the 3rd respondent, claiming award of the work in terms of Clause 8(b)(1) of Exhibit P1. According to them, that letter was refused to be accepted and thereupon, the petitioner sent Exhibit P3 letter by registered post on the same day itself. Despite this, work was not awarded and the intention of the 3rd respondent was to award the work to the 4th respondent and the stand adopted by the 3rd respondent was that the petitioner was not eligible for taking up the work. 6. Coming to know that the 3rd respondent was proceeding to award the work to the 4th respondent, this writ petition was filed on 9/12/2008 and this court by order dated 11/12/2008 admitted the writ petition and ordered notice by special messenger. Subsequently, on 16/12/2008, this Court directed the 3rd respondent not to award the work to the 4th respondent. This position continues even as on date. 7. Counter affidavit has been filed by the respondents 1 and 2, and they are seeking to justify the award of tender in favour of the 4th respondent. It is stated that the petitioner was the highest bidder and since the difference between the petitioner's tender and lowest tender made by the 4th respondent was 30 %, there was no necessity to W.P.(C) No. 36527/2008 4 consider the claim of the petitioner for the benefit of Clause 8(b)(1) of Exhibit P1. It is stated that though the petitioner had given Exhibit P3 letter on 4/12/2008, expressing its willingness to undertake the work 15% below the estimated price, as per rules governing the tender, such offer was was unacceptable. It is further stated that as per the terms of Exhibit P1, petitioner is entitled to the benefit of Clause 8(b)(1) provided the difference in the bid made by them with that of the lowest tenderer is 10%. It is on this basis, the award of work to the 4th respondent is sought to be justified. 8. Counter affidavit has been filed by the 4th respondent. In the counter affidavit, the 4th respondent asserts his right to be awarded the work. It is stated that in view of the provisions contained in the PWD Manual produced in Exhibit R4(b), once tenders are invited the lowest bid should normally be accepted. 9. However, I am not in a position to accept the contention of the 4th respondent for the reason that so long as the Exhibit P1 Government Order is in force, societies like the petitioner are entitled to the benefit of such Government Order. In the matter of award of contract work, where a society, as contemplated under Exhibit P1, W.P.(C) No. 36527/2008 5 expressed its willingness, such society is entitled to be awarded the work as provided in the Government Order. In the effect, the Government order provides an exemption to the General Rules contained in the PWD Manual. 10. Admittedly, the petitioner is a Labour Contract Society and by Exhibit P1 Government order, providing certain benefits to Societies like the petitioner, still remains in force. A reading of Clause 8(b)(1) shows that if the tender made by the private contractor is the lowest, the Labour Contract Society, even if it has made the highest offer, is still entitled to be awarded the work 10% above the lowest tender, provided the society is willing to do the work. It is also the obligation of the awarding authority to ascertain the willingness of the society in writing. If that be so, under Clause 8(b)(1) of Exhibit P1, it is the duty of the 3rd respondent to ascertain the willingness of the society. There is no case for the 3rd respondent in the counter affidavit that he ascertained the willingness of the petitioner. Despite this, it is a fact that the petitioner expressed its willingness to do the work at below 15% PAC, which is 10% above the lowest tender made by the 4th respondent. W.P.(C) No. 36527/2008 6 11. In my view, this offer made by the petitioner is fully in compliance with Clause 8(b)(1) of Exhibit P1. If that be so, the 3rd respondent ought to have accepted the same. The interpretation that the petitioner is not eligible for the benefit of Clause 8(b)(1) since the difference between the lowest tender and petitioner's tender was 30%, and hence the petitioner cannot be given the opportunity to execute the work is clearly against the terms in Exhibit P1 and cannot be accepted. 12. In my view, the petitioner is entitled to be awarded the work and the award of work to the 4th respondent is illegal. 13. For that reason, work awarded to the 4th respondent shall stand set aside. The 3rd respondent is directed to award the work of repair of Cheerankavu-Puthur Road, notified as per Exhibit P2 to the petitioner as provided in Exhibit P1 forthwith on the production of copy of this judgment. Writ petition is allowed as above. ANTONY DOMINIC, JUDGE scm