IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE V.GIRI WEDNESDAY, THE 28TH OCTOBER 2009 / 6TH KARTHIKA 1931 WP(C).No. 28791 of 2009(T) --------------------------------------- PETITIONER(S): ------------------------ C.ASHOKAN , S/O.CHELLAPPAN, AGED 52 YEARS, CONTRACTOR, ASHOKAN BHAVANAM, PONMALA P.O., CHAVARA, KOLLAM DIST. BY ADV. MR.E.K.NANDAKUMAR RESPONDENT(S): -------------------------- 1. THE KERALA MINERALS AND METALS LTD., ( A GOVERNMENT OF KERALA UNDERTAKING, ) MINERALS SEPARATION, UNIT, KOVILTHOTTAM, CHAVARA, KOLLAM. 2. M/S TVK CONSTRCTIONS, ARAMAN, PADA NORTH, KARUNAGAPPALY, KOLLAM. 3. M/S DEEPTHI TRANSPORTATION, KARITHURA, CHAVARA, KOLLAM. R1 BY ADV. MR.K.ANAND (A.201), SC THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 28/10/2009, ALONG WITH WPC. NO.26678/2009 THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) NO.28791/2009 APPENDIX PETITIONER'S EXHIBITS P1:- COPY OF THE NORIFICATION DTD. 2.7.09 PUBLISHED IN THE MATHRUBHUMI DAILY DTD. 5.7.09. P2:- COPY OF THE JUDGMENT DTD. 17.9.09 IN WPC. NO.26188/09 OF HIGH COURT OF KERALA. P3:- COPY OF THE EXPERIENCE CERTIFICATE DTD. 31.12.04 ISSUED BY THE IST RESPONDENT TO THE PETITIONER. P4:- COPY OF THE CERTIFICATE ISSUED TO THE PETITIONER ON 21.8.08 BY THE IST RESPONDENT. P5:- COPY OF THE SOLVENCY CERTIFICATE ISSUED BY THE BANK OF INDIA DTD. 13.8.09. P6:- COPY OF THE JOINT VENTURE AGREEMENT DTD. 17.8.09 ENTERED INTO BETWEEN THE PETITIONERAND M/S.ENCEE RAIL REGARDING THE EXECUTION OF THE WORK. P7:- COPY OF THE TERMS AND CONDITIONS OF THE TENDER CONTAINED IN THE TENDER FORM BEARING NO.KMML/M/S/MINES/RAW SAND/2009-111H DTD. 2.7.09. P8:- COPY OF THE CARRIGENDUM DTD. 17.7.09 ISSUED BY THE IST RESPONDENT. P9:- COPY OF THE COUNTER AFFIDAVIT FILED BY THE IST RESPONDENT IN WPC. NO.26678/09 DT. 28.9.09. TRUE COPY P.A. TO JUDGE tss V.GIRI, J ------------------- W.P.(C)s.28791 & 26678/2009 -------------------- Dated this the 28th day of October, 2009 JUDGMENT These writ petitions relate to the award of contract for collection and transportation of Mineral sand by the 1st respondent. 1st respondent, the Kerala Minerals and Metals Ltd., is a Government of Kerala undertaking. It is inter alia engaged in the manufacture of titanium dioxide pigment. The principal raw material involved in this process is Ilmenite and rutile. The said sand is collected from different sites and the sites involved in these two writ petitions are Ponmana site 1 and Ponmana site No.2. The collection points in relation to these two sites are also different. Though the contentions that have been raised in these two writ petitions are required to be considered separately, they have been heard together since the parties are common. I will deal with the facts in W.P.(C).28791/2009 in the first instance. 2. 1st respondent issued Ext.P1 notification inviting tenders for the collection and transportation of sand using W.P.(C).28791 &26678/09 2 mechanized tippers (rear dump trucks) and delivery at the M.S. Unit (Mineral Separation Unit) by the 1st respondent from experienced contractors. The sites mentioned in Ext.P1 are Ponmana site No.2 wherein the last date for submission of tenders was 22.7.2009 and Ponmana site No.1 wherein the last date for submission was 3.8.2009. The petitioner submitted a tender for both the sites. It has to be noticed at the outset that his tender for Ponmana site No.2 was not accepted because it was not accompanied by a solvency certificate. He sought for extension of time to submit solvency certificate in relation to site No.2. Such time extension was not granted and he had approached this Court in W.P.(C).26188/2009. This Court dismissed the writ petition as per Ext.P2 judgment and the same has become final. The present writ petition namely W.P.(C).28791/2009 relates to Ponmana site 1, wherein also the petitioner had submitted a tender. But he was found to be not pre-qualified. His price bids were therefore, not opened and hence the writ petition seeking a direction to the 1st respondent to consider the petitioner's tender in site No.1 (Ponmana site 1) mentioned in Ext.P1 in this writ petition. W.P.(C).28791 &26678/09 3 3. Petitioner herein has not been pre-qualified on two grounds. Firstly, his annual turn over for the financial year 2006-07 was not adequate in terms of clause 4 of the conditions of tender (Ext.P7). Secondly, the petitioner had failed to submit a solvency certificate for a minimum amount of Rs.25 Lakhs, as per Clause 4(c) of Ext.P7. According to the petitioner, he had done the same work for the 1st respondent earlier as evidenced by Exts.P3 and P4. Ext.P4 relates to the work which was done during the period from 12.7.2005 to 2.6.2006 and the value of the contract for the said period is Rs.1,67,52,906/- and this would take in a not inconsiderable portion of the financial year 2006-07. Therefore, the 1st respondent should have treated Ext.P4 as adequate, it is contended. 4. With regard to the requirements of a solvency certificate for a minimum of Rs.25 Lakhs, petitioner refers to Ext.P5 solvency certificate issued in relation to one M/s Encee Rail Linkers, Mumbai, and petitioner claims that the aforementioned concern is a joint venture partner of the W.P.(C).28791 &26678/09 4 petitioner. Reference is made in this regard to Ext.P6 joint venture agreement between the petitioner as a Lead partner and M/s.Encee Rail Engineers & Fabricators Private Ltd., as a Financial Partner. Ext.P6 agreement is dated 17.8.2009, which significantly is the last date for submission of tenders. Petitioner contends that since the petitioner's Financial partner is solvent enough and satisfies the requirements of Clause 4 of Ext.P7, petitioner should have been pre-qualified. 5. Counter affidavit has been filed by the Company, the 1st respondent as also by the 2nd respondent and a reply affidavit has been filed by the petitioner. I heard Mr.Gopinatha Menon, learned counsel for the petitioner, Mr.Anand, learned counsel for the 1st respondent and Mr.Rajasekharan Pillai and Mr.Suresh Menon, learned counsel for the contesting respondents. 6. Mr.Gopinatha Menon submits that insofar as the annual turn over of the petitioner is concerned, Ext.P4 will show that the petitioner had undertaken a work having a value of W.P.(C).28791 &26678/09 5 Rs.1,67,52,906/- with the 1st respondent itself during the period from 12.7.2005 to 2.6.2006. No doubt, Clause 4 of Ext.P7 speaks about the minimum turn over of Rs.50 Lakhs for anyone of the financial years from 2006-07 and since the period of contract mentioned in Ext.P4 would take in a portion of financial year from 1.4.2006 onwards, the petitioner's turn over for the financial year 2006-07, he contends, would have exceeded the minimum of Rs.50 Lakhs. 7. Learned counsel for the respondent submits that the petitioner cannot insist that the Company should undertake the process of splitting up the value of the contract mentioned in Ext.P4 and then ascertain whether the petitioner's annual turn over for the year 2006-07 was in excess of Rs.50 Lakhs. Learned counsel for the petitioner submits that at any rate, the Company should have called for a clarification. 8. I have gone through the Clauses in Ext.P7. It does not specifically require the tendering authority to call the tenderers for a clarification on anyone of the aspects, that are W.P.(C).28791 &26678/09 6 considered relevant for the purpose of pre-qualification. In my view, petitioner could have demonstrated his annual turn over for the period 2006-07, by resort to other documents mentioned in Clause 4(a) namely Income Tax clearance/assessment order or audited balance sheet, as the case may be. Petitioner could have also asked for an experience certificate from the 1st respondent specifically indicating the value of the contract for the financial year 2006-07. That was not done and as it is, the tendering authority, the 1st respondent, cannot be faulted with for not treating Ext.P4 as an adequate experience certificate indicating the value of the contract undertaken by the petitioner, for the year 2006-07 and also indicting the annual turn over of the petitioner for the financial year 2006-07, as to be in excess of Rs.50 Lakhs. I take note that the petitioner does not have a case that he had undertaken a work other than the work which is mentioned in Ext.P4, during the financial year 2006-07. At any rate, since these are matters which should have been demonstrated by the tenderer by resort to other documents mentioned in Clause 4, and the petitioner has not made any attempt to do so, one cannot find W.P.(C).28791 &26678/09 7 fault with the 1st respondent for not accepting Ext.P4 as adequate in terms of Clause 4(a) of the tender conditions. 9. Nor can the 1st respondent be faulted with for not accepting Ext.P5 solvency certificate. Ext.P5, it is pointed out, is a solvency certificate of one M/s Encee Rail Linkers, Mumbai. According to the petitioner, the aforementioned concern is a Financial Partner of the petitioner as per Ext.P6 joint venture agreement. It is the case of the 1st respondent that the joint venture agreement itself was not submitted along with the tender. There was nothing in the tender documents submitted by the petitioner to indicate that the tender is a joint venture of the petitioner and the concern described as a Financial Partner in Ext.P6. The original of the tender document submitted by the petitioner before the 1st respondent was made available by the learned counsel for the 1st respondent. The price bid has not been opened and the sealed cover has also been produced before me. I have gone through the tender documents and it is significant that there is nothing in the tender document submitted by the petitioner to indicate that the tenderer is a joint venture mentioned in W.P.(C).28791 &26678/09 8 Ext.P6. If that be so, obviously Ext.P5 solvency certificate, which purportedly relates to the joint venture Partner of the petitioner, by itself, would not have enabled the petitioner to claim that the requirement of Clause 4(c) relating to a solvency certificate was satisfied by him. The 1st respondent cannot therefore, be faulted with for not treating the petitioner as pre-qualified. Two of the conditions mentioned in Clause 4 of the tender conditions were therefore, not satisfied by the petitioner. I also take note of the contentions of the counsel for the 1st respondent that there is a difference in the name of the entity, as given in Ext.P5, which is M/s Encee Rail Linkers, Mumbai, and the concern which is described in Ext.P6 M/s.Encee Rail Engineers & Fabricators Private Ltd. Prima facie the two concerns are different. 10. For all these reasons, I am of the view that this Court in judicial review is not in a position to find fault with the decision taken by the 1st respondent, to treat the petitioner as not pre-qualified in terms of the tender conditions. 11. Insofar as W.P.(C).26678/2009 is concerned, it relates to W.P.(C).28791 &26678/09 9 the award of contract in relation to site No.2, namely Ponmana site No.2. Contract in the said case has been awarded in favour of the 2nd respondent, M/s.Deepthi Transport Service. Two contentions have been raised by the petitioner herein. One is that the 2nd respondent ought not to have been treated as pre-qualified in terms of the tender notification and significantly 2nd respondent was not the lowest tenderer and at any rate, the petitioner and the 2nd respondent should have been called for a negotiation by the tendering authority. 12. I will consider the contention that the 2nd respondent is not pre-qualified. According to the petitioner, the 2nd respondent has not produced adequate proof that it was in possession of requisite equipments and vehicles for undertaking the loading, transportation and supply of mineral sand. Reference is made in this regard to Clause 1.4 of the tender conditions, which in this case is Ext.P2. Same reads as follows. The contractor shall engage sufficient number of front end loaders of engine capacity more W.P.(C).28791 &26678/09 10 than 80 HP for collection, loading and heaping of the mineral sand depending on availability. The contractor shall also be required to collect and heap the mineral sand selectively depending on Ilmenite content. 13. It is further contended that at any rate, proof of possession of such equipments and vehicles was not submitted by the 2nd respondent along with the tender documents. This assertion is denied by both by the Company as also by the 2nd respondent. 1st respondent Company, submits that Clause 1.4 of Ext.P2 does not contemplate any ownership of the machines and the 2nd respondent had produced the documents regarding the machinery. Reference is made in this regard to Ext.R1(b) dated 27.7.2009. The stand taken by the awardee, the 2nd respondent, is that it had produced the documents, from M/s.Revathi Terra Ways, showing the availability of requisite vehicles of mechanized collection, loading, transportation and supply of minerals. Ext.R1(b) produced by the Company has been produced by the 2nd respondent as Ext.R2(e). Apart from the same, according to the 2nd respondent, Ext.R2(e) had also W.P.(C).28791 &26678/09 11 been produced. Same is also a certificate from M/s.Revathi Terra Ways, giving the details of the vehicles available with them, if in case, the 2nd respondent is awarded the work. 14. Going by the tender conditions, this demonstration of being in possession of the vehicles mentioned in Ext.R2(d) and (e) is sufficient. There is no reason why I should not accept the version given by the tendering authority as regards the pre-qualification of the 2nd respondent. After all, petitioner in this case, is now proposed to be awarded a contract for site No.1. I am unable to accept the contention of the petitioner herein, that the 2nd respondent should not have been treated as pre-qualified for the work in question. 15. It is then pointed out by Mr.Rajasekharan Pillai that the petitioner was the lowest tenderer for the work in question and should have therefore, been awarded the work. The following are the details of the rates quoted by the petitioner, the 2nd respondent and the rate for the previous year for the work in question namely site No.2. W.P.(C).28791 &26678/09 12 TVK (Rs) Deepthi (Rs.) 1 Supply of raw sand from Ponmana site- II to preconcentrati n Plant- Ponmana Per cubic meter a) collection 85/- 50/- 80/- b)Transpor- tation 230 250/- 227 Total 315 300 307 2 Supply of raw sand from Ponmana site- II to M.S.Unit Per MT a)Collection 44 37 38 b)Transpor- tation 145 128 138 Total 189 165 176 Grand Total 504 465 483 16. Mr.Pillai contends that the work of supply of materials from Ponmana site No.2 consists of two different aspects. One is collection and the other is transportation from the M.S.Plant to the Company. He points out that the rate quoted by the petitioner for transportation is Rs.230/- which is lower than the rate quoted by the 2nd respondent, the Company, ie, Rs.250/-. According to him, since the work is shown as collection and transportation, the contract itself could have been split into two. He further submits that at any rate, since W.P.(C).28791 &26678/09 13 the rate quoted by the petitioner for one of the aspects of the work namely the transportation was the lowest, petitioner should have been, at least, called for negotiation along with the 2nd respondent. He further submits that the petitioner is at any rate, now operating at site No.2 and therefore, he is an experienced contractor. He refers to the judgment of a Bench of this Court in W.A.1494/1999 where this Court had in the matter of an award of collection and transportation contract with the 1st respondent, directed the Company to call both the parties for negotiation. 17. Learned counsel for the 1st respondent as also the 2nd respondent points out that the work in question is a composite one of collection and transportation and it is clear from the above statement that the rate quoted by the 2nd respondent is the lowest and in fact is even lower than the existing rate. 18. I find force in the submission made by the counsel for the respondents. The work is of collection and transportation and therefore, the rate quoted by the rival tenderers, is a composite rate for both the collection and transportation. W.P.(C).28791 &26678/09 14 Obviously, it would not be feasible to award the contract by splitting the work into collection and transportation. The work is a composite one of collection and transportation. If that be so, the rate quoted by the 2nd respondent namely Rs.300/- is lower than the rate quoted by the petitioner, Rs.315/-. 19. Learned counsel for the petitioner submits that at any rate, the petitioner should have been called for a negotiation. I am unable to accept the submission. The Company has decided to award the contract to the lowest tenderer namely the 2nd respondent and if that be so, it is not necessary to call the petitioner for negotiation. 20. I have gone though the judgment in W.A.1494/1999. It dealt with a contract of a similar nature. But the Bench as such did not laid down any principle which can qualify itself as a precedent. 21. Ultimately, the question is whether this Court sitting in judicial review is in a position to find any error in the decision W.P.(C).28791 &26678/09 15 making process undertaken by the 1st respondent. After all, the 1st respondent has awarded the contract to the tenderer who had quoted the lowest rates. No grounds for interference have been made out. 22. For all these reasons, I am of the view that the writ petitions lack merit and accordingly both the petitions are dismissed. V.GIRI, Judge mrcs