HON’BLE SRI JUSTICE NOOTY RAMAMOHANA RAO WRIT PETITION NO.16577 OF 2011 ORDER: This writ petition has been instituted seeking a Writ of Mandamus for declaring the action of the Respondents 1 to 3 in awarding a contract pursuant to the notice inviting tenders (NIT) dated 22.12.2010 in favour of the fourth respondent as illegal, as the fourth respondent is not eligible to participate in the tendering process. 2. The case of the petitioner is that National Thermal Power Corporation, (henceforth referred to as NTPC) having its unit at Ramagundam has issued notice inviting tenders (NIT) dated 22.12.2010 to award an annual contract for picking up stones, boulders and foreign materials from the running conveyors of coal handling plant at its unit at Ramagundam. It is further stated that this notice was got published in the daily newspapers issued on 02.02.2011. The last date for purchase of the tender document was stipulated as 28.02.2011. The tender process comprises of two stages, the first stage is consideration of the technical bids and the second stage is consideration of the commercial bids of technically qualified bidders. Technical bids were proposed to be opened on 14.03.2011. It is stated that the fourth respondent has failed to satisfy the qualifying requirement relating to the minimum annual turnover required to be put in and also lacks requisite experience of having executed similar work in the past seven years. In view of this lacunae on the part of the fourth respondent, the respondent-NTPC ought not have accepted the technical bid as responsive treating the fourth respondent to have possessed the necessary qualifying requirements. It is pointed out that the petitioner has filed a detailed representation on 11.04.2011 pointing out as to how the fourth respondent failed to satisfy both the qualifying requirements. It is pointed out that the fourth respondent has not put in turnover of business of Rs.78.88 lakhs worth during any of the last three financial years ending with March 2010 and further, they have executed one single work of the value of Rs.65.70 lakhs to Singareni Collieries Company, which work included loading and transportation of picked up material to a dump yard situated within a distance of five kilometers and for which purpose the fourth respondent was required to deploy drivers, loading and unloading labour, tractors, trailors etc, and when the value of this component is deducted, the fourth respondent would have fallen short of the requirement value of a single work of Rs.62.95 lakhs prescribed as the qualifying requirement in the NIT and hence, the action of the respondent-NTPC in treating the offer of the fourth respondent as responsive is bad in law. It is stated that, without properly examining the representation submitted by the petitioner, the NTPC has fixed 11.05.2011 for opening the commercial bids. Hence, the writ petitioner company is constrained to file Civil Suit No.18 of 2011, wherein IA.No.25 of 2011 was moved seeking an ex parte temporary injunction. After receiving the notice and summons, in the said civil suit, NTPC opened the commercial bids and finding the fourth respondent as the lowest bidder (L-1) awarded the contract. On 13.05.2011, the Civil Court granted an order of status quo ante. The NTPC carried the matter in appeal by preferring CMA.No.472 of 2011 and this Court by its order dated 25.05.2011 suspended the orders passed by the Civil Court. Hence this writ petition. 3. The respondents have filed their counter affidavits disputing the veracity of the statements of fact set out by the petitioner. They have asserted that the fourth respondent did possess and satisfy the qualifying requirements contained in the NIT. It is further pointed out that the offer of the fourth respondent was the lowest in comparison to the rest of the offers including that of the writ petitioner and hence the NTPC has done nothing wrong in accepting the offer of the fourth respondent and awarding him on 11.05.2011 the annual contract for picking of stones, boulders and foreign material from the running conveyors of the coal handling plant of NTPC for a total order value of Rs.77,21,940/-. It is further pointed out that the writ petitioner was awarded the same work in the past and therefore he has been dealt with fairly and properly in the matter of evaluation of it’s bid and the respondent corporation has not done anything in deviation of the stipulations contained in the NIT. By accepting the lowest offer, the financial interests of the NTPC are protected. 4. Heard Sri P. Venugopal, learned senior counsel appearing for Sri A. Ravinder, learned counsel for the petitioner and Ms. G. Sudha, learned standing counsel for NTPC and M/s Indus Law Firm for the fourth respondent. 5. It is not in dispute that the NTPC floated the notice inviting tender bearing date 22.12.2010, fixing 11.30 AM on 14.03.2011 as the time and date for opening the technical bids. The bids were to be received latest up to 11.00 AM on 14.03.2011. The scope of work specified in paragraph 1.0.0 of the NIT reads thus: 1.0.0 SCOPE OF WORK: “The scope of work envisages manual picking up of stones, boulders and other foreign materials such as iron pieces, shales etc., coming along with coal and moving with coal on running conveyors (as detailed in the enclosed schedule of quantities/BOQ) and disposal of the same into collecting bins. Removing of iron and metal pieces identified by suspended magnets and metal detectors, separation of big size coal lumps from the conveyors to prevent belt damage etc., including providing necessary tools, tackles safety items and continuous supervision of work as required and any other associated work as per the instructions of Engineer-in-Charge.” 6. The stone picking work from the running conveyors was to be performed on round the clock basis on all days including Sundays and Holidays. It was further made clear that, no workman shall be deployed for working more than eight hours during the shift and the workmen shall be given weekly off for which extra workmen will have to be kept at the site and no inexperienced person shall be deployed as a stone picker and that the contractor shall take all safety measures for the job and all necessary safety equipment should be provided to the workmen by the contractor. In paragraph 2 of the general conditions (appended to NIT), the period of contract has been specified to be 12 months from the date of commencement of work subject to the discretion of NTPC for reducing the said period. The qualifying requirements for the bidders have been specified in paragraph 1 of the note appended to the NIT. The qualifying requirements specified therein are these: “Tender should: a) Have an average annual turnover not less than Rs.78.68 Lakhs during the last Three (03) Financial Years ending with March 2010. b) Have executed directly under owner (i.e. end-user) or under ‘PSU or its Joint Venture company’ / ‘Govt or Semi-Govt department’, the work(s) of “Picking of Stones/Boulders/ Foreign materials from running conveyors in Thermal Power Stations / Mining Industries / Process Industries” for the following values of Contract(s) during the last Seven (7) Years ending with the last date of the month preceding to the month of publication of NIT. One (01) work of value not less than Rs.62.95 Lakhs. (or) Two (02) works each of value not less than Rs.39.34 Lakhs. (or) Three (03) works each of value not less than Rs.31.47 Lakhs. c) Have Independent P.F. Code No. allotted by Regional Provident Fund Commissioner.” 7. As a proof of meeting the qualifying requirements along with the technical bid: “Legible copies of the following documents duly signed by the authorized representative of the bidder are to be submitted in support of the qualifying requirement along with technical bid. a) i) Award letter / Work Order with bill of quantities (ii) proof of value of work executed as mentioned at (b) below. b) Documentary evidence issued by the employer as proof of value of work executed clearly indicating (i) the executed value of work and (ii) period (giving start date and end date) during which the work has been executed, in the form of job completion certificate/final deviation order / copies of measurement book (R/A bills). An employer means Government /Large Industrial Organizations/ Public Sector Enterprises. c) Copies of Balance sheet and Profit & Loss Account as audited by a practicing Chartered Accountant OR Certificate of Turnover issued by a practicing Chartered Accountant clearly indicating the Books/ Records/ Documents on basis of which certificated is issued. d) The Bidder shall indicate on copies of credentials (copies of the work orders and performance/ completion certificates from Govt./PSU/Organizations as specified in the Qualifying requirements, The condition a), b) & c) of Qualifying Requirements against which the credential is being submitted may be indicated on the document.” The original documents referred to supra were required to be produced for purpose of verification, as and when called for. 8. It is therefore abundantly clear that, it is not enough for a bidder to claim to possess the qualifying requirements but such bidder is required to produce the original documents in proof of meeting the said qualifying requirements. When a closer scrutiny is laid for the qualifying requirements, it becomes clear that the bidder was, in fact, required to have an average annual turnover of not less than Rs.78.68 lakhs during the last three financial years ending with March 2010. Similarly, to vouch for his experience of having executed the work of picking of stones/boulders/foreign material from running conveyors in Thermal Power Station/Mining Industries/ Process Industries during the last seven years ending with the last date of the month preceding to the month of publication of NIT, the bidder must produce supportive documents as and when required. Since the NIT was published on 02.02.2011, the bidder should have gained experience required in the past seven years ending with 31.01.2011. If he has executed one work, the value of each work shall not be less than Rs.62.95 lakhs. If he has executed two works, the value shall not be less than Rs.39.34 lakhs. If he has executed three works, the value of each work shall not be less than Rs.31.47 lakhs. The last requirement is that every bidder should have independent provident fund code number allotted to it by the Regional Provident Fund Commissioner. There is no dispute raised by the parties with regard to the third element of having independent Provident Fund Code by the fourth respondent. The whole dispute is centering around the financial capacity of the petitioner of having an average annual turnover of not less than Rs.78.68 lakhs in the three preceding financial years ending with March 2010 and his experience of having executed a work of the value of not less than Rs.62.95 lakhs. 9. The fourth respondent in support of his claim, that he satisfies the eligibility requirement relating to his financial claim, enclosed a certificate issued by M/s Anil Raghava and Associates, Chartered Accountants that it has turned over work of the value of Rs.30,92,655/- during 2008-2009, Rs.74,90,661.38/- during 2009-2010 and Rs.1,31,61,615.80/- during the year 2010-2011. Thus, it had executed works in the last three years cumulative turnover of which has worked out to Rs.2.375 Crores, and the average of which works out to Rs.79.1 Lakhs. Learned Senior Counsel Sri Venugopal has however rightly pointed out that, from the certificate furnished by the Chartered Accountants of the fourth respondent, the turn over particulars were furnished for the financial years 2008-2009, 2009-2010, 2010-2011. He therefore contended that turnover for the financial year 2010-2011 of Rs.1,31,61,615.80/- cannot be taken into reckoning, inasmuch as the qualifying requirements provided in the NIT required, the turnover for the past three financial years ending with March 2010. It is not at all in doubt that the NIT required the turnover details to be furnished for financial year ending with March 2010. Therefore, the certificate issued by the Chartered Accountants of fourth respondent does not reflect that the fourth respondent satisfied the requirement of an average annual turnover of not less than Rs.78.68 lakhs. 10. However, when this fact was confronted with, the learned standing counsel for the NTPC was quick to point out that the bidders were required to produce the documentary evidence in proof of their claim, by producing copies of the balance sheet and profit and loss account as audited by a practicing Chartered Accountant or certificate of turnover issued by a practicing Chartered Accountant, clearly indicating the books/records/ documents on the basis of which the certificate is issued. Therefore, Ms. Sudha would contend that it is not merely enough for a bidder to make a claim about the turn over achieved by him, but the bidder is further required to produce the audited balance sheet and profit and loss account in proof of such a claim. Accordingly, the learned standing counsel has produced before me the file containing the documents enclosed to the bid of the fourth respondent. Apart from the certificate issued by M/s Anil Raghava and Associates, Chartered Accountants, who no doubt furnished the turnover details of the fourth respondent for the financial years 2008- 2009, 2009-2010, 2010-2011, but the fourth respondent has also produced the audited statements of their balance sheet together with profit and loss account for the past three years ending upto March 2010 and they have also enclosed the returns filed by the fourth respondent during the corresponding assessment respective years with the Income Tax Department. When I perused them, they clearly disclose that the figures mentioned relating to the turn over of the fourth respondent by their Chartered Accountant are, in fact the turnovers achieved during the assessment years 2008-2009, 2009-2010, 2010- 2011. As is common knowledge, assessment year 2010-2011 corresponds to financial year 2009-2010 which ended on 31.03.2010. Therefore, the audited profit and loss account together with the balance sheet and the income tax returns filed by the fourth respondent are, undoubtedly and clearly, indicating the correctness of the turnover figures mentioned by the Chartered Accountant in his certificate. There is no error therein excepting that the Chartered Accountant instead of mentioning ‘Assessment Year’, erroneously mentioned as ‘Financial Year’. It is no doubt true that a prudent or a careful Chartered Accountant would not have made such a silly mistake, as more than anyone else, it is the Chartered Accountant who should be thoroughly aware of the distinction between an ‘Assessment Year’ and a ‘Financial Year’. 11. Can the bid of the fourth respondent be condemned only on the ground that the certificate furnished by the Chartered Accountant mentions ‘Financial Year’ instead of ‘Assessment Year’? To my mind, the fourth respondent’s claim cannot be discarded only on that basis as the error committed in that regard is an inadvertent one. In view of the requirements specified in Note 4 C appended to the NIT issued by the respondent NTPC, it is the contents of the documents that should be conclusive with regard to the claims of annual turnover achieved in the past three years by the bidders. If the NIT merely asked for a certificate from the Chartered Accountant without any further requirement of documentary proof, perhaps the contention canvassed by Sri P. Venugopal, that the particulars mentioned by the Chartered Accountant in his certificate, deserves a serious consideration. However, the NIT did not stop there. It also called upon every bidder to produce copies of the audited balance sheet together with profit and loss account. It also cautioned the bidder to produce the original documents for verification as and when called upon to do so. In the instant case, the accompanying documents to his bid namely audited statements of balance sheet and profit and loss account of the fourth respondent, which were faithfully reflected in the returns filed by the fourth respondent with the Income Tax Department, clearly demonstrate that the fourth respondent has an average annual turnover of Rs.79.1 lakhs. In view of this specific requirement of the NIT, it is clear that the claims of every bidder are liable to be verified and tested with reference to the documentary proof. When the documentary proof produced by the fourth respondent explains quite satisfactorily that it has achieved a turn over of a little more than Rs.2.375 crores in the last three financial years, ending on 31.03.2010, an average annual turnover of which works out to Rs.79.1 lakhs, I find it difficult to hold that the action of the NTPC in coming to a conclusion that the fourth respondent has satisfied the qualifying requirement in this regard, as erroneous. The Judgment of the NTPC in this regard is obviously based upon the annual turnover figures reported by the fourth respondent in the past three financial years ending on 31.03.2010, as reflected in their Income Tax returns which were already filed along with his bid. Hence, I find that the fourth respondent’s bid has been rightly found to be responsive in this regard by the respondent-NTPC. There is nothing arbitrary about that decision of the NTPC. Further, the error committed by the Chartered Accountant is too technical and hence the action of the NTPC in ignoring the same and instead to go by the documentary proof produced cannot be faulted. 12. Further, the qualifying requirement talks of “Average annual turnover” of not less than Rs.78.6 lakhs during the last three financial years ending with March 2010. When once the expression ‘average annual turnover’ is used, it is imperative that every bidder must show the annual turnover of business achieved in the past three years ending with March 2010. Even if the bidder has not achieved the turnover of Rs.78.68 lakhs during any one or two of the three consecutive years ending with March, 2010, the deficiency in that regard can be made up in the third year. Therefore, the cumulative total turnover achieved by the bidder for the past three years is liable to be taken into reckoning and then the same must be divided by three to arrive at the average annual turnover. NTPC understood this requirement, in the same manner. The understanding of the NTPC in this regard is in consonance of the language employed in the NIT. Therefore even on this count, the objections raised by the petitioner herein that the fourth respondent does not satisfy the qualifying requirement of financial capability is ill-founded. 13. That takes us to the next contention with regard to lack of adequate experience on the part of the fourth respondent to have executed similar work/works in the past seven years. From a perusal of the qualifying requirements in this regard if the bidder has executed one work, value of which is not less than Rs. 62.95 lakhs, in the past seven years with any of the Thermal Power Stations or Mining Industries or Process Industries relating to and concerning picking of stones/boulders/foreign materials from running conveyors, such a bidder is liable to be treated to have possessed the necessary experience. In the instant case, the fourth respondent has produced a work order placed on it by the Singareni Collieries Company Limited on 26.04.2009. It is not further in dispute that Singareni Collieries Company Limited is a mining industry. They awarded to the 4th respondent a contract for “picking of shale, stone and foreign material from the coal on running belts” for a period of one year from 24.04.2009 to 23.04.2010, the total value of which was shown as Rs.65.70 lakhs. It is worthy to notice that the qualifying requirements set out in Note 1 of the NIT floated by the NTPC has taken two different periods for the purpose of reckoning the qualifying requirements while, end of March 2010 is specified with regard to the financial requirement of the bidder, the experience requirement is confined up to the last date of the month preceding to the month of publication of NIT. Undoubtedly, the NIT was published on 02.02.2011. Therefore for purpose of experience, qualification, 31.01.2011 becomes the relevant date. As was noticed supra, the fourth respondent has been awarded the work order on 26.04.2009 by Singareni Collieries up to 23.04.2010. Therefore the claim made by the fourth respondent that he has executed one single work of the value of Rs.65.70 lakhs satisfies the qualifying requirement provided in the NIT. 14. However, Sri P. Venugopal, learned senior counsel would contend that the work order placed by the Singareni Collieries Company on the fourth respondent also included transportation of the said picked up foreign material to a dump yard which is five kilometers away from the running belts. Therefore the component of the value towards transportation charges is liable to be deducted from the value of the work order of Rs.65.70 lakhs awarded by the Singereni Collieries Company Limited in favour of the fourth respondent and if so done, the value of work executed by the fourth respondent would come down to less than Rs.60.00 lakhs and hence the fourth respondent is liable to be declared to have failed with regard to the experience requirement provided for in the NIT. On that basis, pleads the learned senior counsel, the bid of the fourth respondent ought to have been rejected by the NTPC. Learned senior counsel has also pointed out that the value quoted by the fourth respondent to Singareni Collieries is inclusive of all taxes and duties including Cess and Royalties imposed by local, municipal, state and central authorities. It is common ground that Value Added Tax (VAT) is to the order of 10.5% and if the said component is deducted from the total value of Rs.65.70 lakhs, the value of the work executed by the fourth respondent clearly falls short of the qualifying requirement of Rs.62.95 lakhs stipulated by NTPC. Learned senior counsel further submits that NTPC clearly pointed out that the value to be quoted by the bidder is not inclusive of taxes/duties. 15. It is no doubt true that from the work order awarded by Singareni Collieries Company on 26.04.2009 to the fourth respondent, it is very clear that the quoted rate of the fourth respondent is inclusive of all taxes and duties. It is also equally true that the afore mentioned work order required the fourth respondent to undertake loading, transportation unloading and stacking of the picked up foreign material from running belts to a dump yard within a distance of five kilometers, for which purpose drivers and other personnel together with tractor trailors and tippers must be deployed by the fourth respondent. It is equally true that when NTPC solicited a clarification from the fourth respondent in that regard, the fourth respondent has submitted on 19.04.2011 that it is not possible to furnish the detailed break-up of each component of the work order granted to it by Singareni Collieries Company Limited including transportation of the foreign material to the dump yard. 16. The question that is required to be considered is whether the emphasis is upon execution of a single work of value of not less than Rs.62.95 lakhs as set out in the NIT floated by the NTPC or not? The work experience must be with regard to execution of a work relating to collection of stones, boulders or foreign material from running belts. That was the essential nature of work, which the NTPC wanted to award. That was the purpose for which the NIT was floated and the NTPC expected the value of such work to be of the order of not less than Rs.62.95 lakhs. It is therefore for the bidder to satisfy the NTPC that it has executed a similar work relating to picking of stones, boulders and foreign material from running belts deployed by any Thermal Power Station or Mining Industry and the value of such single work should not be less than Rs.62.95 lakhs. When we peruse the work order dated 26.04.2009, which forms the basis for the claim of the fourth respondent herein towards it’s experience, it becomes crystal clear that the main component of work awarded by Singareni Collieries Company