WP(C) 263/2011 BEFORE THE HON’BLE MR. JUSTICE B.P. KATAKEY The petitioners, who have constituted amongst themselves a consortium fo r bidding in the tender process initiated by Assam Power Distribution Company Lt d., the respondent No.1, by the present petition has challenged the decision mak ing process in arriving at the decision as reflected in the communication dated 17.12.2010 issued by the respondent No.1 intimating the petitioner No.1 that the ir bid have been found to be technically non-responsive and hence the price bid would not be opened. The petitioners have also prayed for a direction to the res pondent No.1 to consider their price bid along with other eligible bidders. 2. The facts relevant for the purpose of disposal of the writ petition may be noticed as under: I. The Govt. of India, Ministry of Power (MoP) issued the office memorandum dated 22.12.2008 approving the continuance of Accelerated Power Development & R eforms Programme (APDRP) as Central Sector Scheme during the 11th Five Year Plan with revised terms and conditions focusing on actual and demonstrable performan ce in terms of sustained loss reduction, establishment of reliable and automated systems for sustained collection of accurate baseline data and adoption of Info rmation Technology in the areas of energy, covering the urban areas i.e. towns a nd cities with a population of more than 30,000. Such population limit, however, was relaxed to 10,000 in case of special category cities like in the northeaste rn States. For implementation of the said scheme the Govt. of India has issued v arious guidelines from time to time. As per the initial guideline dated 22.12.20 08, the projects under the Scheme are required to be taken up in two parts, name ly, Part-A and Part-B. The guideline in Part-A includes the project for establis hment of baseline data and IT applications for energy accounting/auditing and IT based consumer service centres and Part-B includes regular distribution strengt hening projects. The activities of Part-A covers preparation of baseline data fo r the project area covering Consumer Indexing, GIS Mapping, Metering of Distribu tion Transformers and Feeders and Automatic Data Logging for all distribution tr ansformers and feeders and SCADA/ DMS system etc. It also includes adoption of I T applications for meter reading, billing and collection, energy accounting and auditing, MIS, redressal of consumer grievances, establishment of IT enabled con sumer service centres etc. Since the present case relates to the Part-A activiti es of the programme, the Part-B activities have not been discussed. II. Under the said guideline the Power Finance Corporation (PFC) has been ma de the Nodal Agency for operationalisation and implementation of APDRP programme , under the overall guidance of the Ministry of Power (MoP), Govt. of India. The modalities of formulating/implementing projects under the programme have also b een stipulated in the said guideline. For the purpose of project formulation, th e Utilities, namely, States where such projects are to be implemented, are requi red to prepare the Detailed Project Reports (DPR) for each of the project areas, which are required to be forwarded to the Nodal Agency. The Utilities have also been authorized to appoint IT consultants through bidding by an open bidding pr ocess, from the IT consultants empanelled by the Nodal Agency/MoP after observin g codal formalities, for preparation of DPR for Part-A projects. It also require s the State Electricity Boards/State Utilities to implement the projects sanctio ned on a turnkey basis by appointing IT Implementing Agency (ITIA) through a bid ding process, only from the panel of ITIA notified by the Nodal Agency to ensure quality and expeditious implementation. Those ITIA, who are eligible for partic ipating in the bidding process to be initiated by the State Utilities are empane lled by the Nodal Agency/MoP after observing codal formalities. The said guideli nes also provide for the issuance of further guidelines for implementation of th e projects by the MoP from time to time. III. The initial guidelines issued by the Govt. of India for technical bid ev aluation in appointing ITIA by the Utilities, was, however, modified by the addi tional guideline issued on 09.12.2009, providing amongst others that while evalu ating the technical bid of ITIAs, the technical score assigned to the System Int egrator across the utilities should not vary substantially and that the bids are not disqualified technically on flimsy grounds, for which the Utilities, if req uired, are to seek clarification wherever possible from the bidders before rejec ting the bids. It also requires issuance of Request for Proposal (RFP) by the Ut ilities in terms of the guideline and the model documents approved by the approp riate authority/PFC /MoP. In the said modified guideline, it has specifically be en mentioned that the Utilities shall comply with the bid evaluation guideline i ssued. The minimum qualification mark for technical score, for the purpose of te chnical evaluation of a bidder, has been fixed as 35 out of total marks of 50, w hich was distributed in different heads, as follows:- (a) Technical solution as per SRS : 21 marks. (b) Approach & Methodology : Nil. (c) Project Experience : 15 marks. (d) Team Details (CV) : 6 marks. (e) Firm Details : 8 marks. TOTAL : 50 marks. IV. A further guideline was, thereafter, issued by the Govt. of India on 26. 05.2010 requiring the Utility to submit to the MoP/PFC, the list of non-responsi ve bidders, if any, in technical bid evaluation along with reasons for disqualif ication, views of the IT consultants as per their technical evaluation report an d also the justification of the Utility for approval. It requires the Utility to evaluate the price bids of the bidders only after approval of the rejection of the bids of the bidders in technical evaluation. V. A decision was taken at the appropriate level to issue the joint RFP for implementation of the projects by all the Northeastern States, namely, Assam, N agaland, Meghalaya, Manipur, Tripura, Mizoram and Arunchal Pradesh, and authoriz ing the respondent No.1 to issue the RFP and accordingly on 20.05.2010 RFP was i ssued by the respondent No.1 for selection of ITIA to assist the Utilities of th e northeastern region for implementation of the projects, fixing 21.06.2010 as t he last date for submission of the bids, following the two bid system, i.e. the technical bid and the price bid, which was subsequently extended to 16.07.2010. One of the stipulations in the said RFP is that the price of those bidders, who are found to be responsive in technical evaluation, as per terms and conditions in the RFP as well as the guidelines issued by the Govt. of India from time to t ime, would be opened. VI. Clause D.1 of the RFP provides the general guidelines to the bidders. It provides that the purchaser, namely, the Utility will select a supplier i.e. bi dder in accordance with the eligibility criteria indicated in Section IV, which reads as follows:- For all bidders (except power sector utilities) i. The SI must have implemented at least one system integrator project cove ring IT applications, Servers and PCs, WAN with connectivity between at least 10 locations, during the last three financial years. In case of a consortium, this requirement needs to be met by the SI-Lead. (Proof: Necessary Purchase order/LOI/Contract/ Certification on client letter he ad/Performance certificate as proof of services provided for the last 3 financia l years needs to be submitted) ii. The SI should have cumulative turnover of at least Rs.300 crore for the last three audited financial years. In case of a consortium, the consortium as a whole (SI-Lead and SI-2nd combined) should have cumulative turnover of at least Rs.300 crore for the last three audited financial years. The SI-Lead should hav e a turnover of at least Rs.270 crore for the last three audited financial years . (Proof: Annual Audited Financial Statements for last three financial years) iii. The SI should have a positive net worth not less than paid-up equity, in each of the last three audited financial years. In case of a consortium, both t he SI-Lead and SI-2nd should have positive net worth not less than paid-up equit y in each of the last three audited financial years. (Proof: Annual Accounts for last three financial years) iv. The SI should have been in the IT/Software services for the last 3 years . In case of a consortium, this requirement needs to be met by the SI-Lead. (Proof for which to be submitted in the form of Incorporation Certificate along with Memorandum & Articles of Association) v. The SI should have implemented a turnkey Systems Integration project in the last three financial years involving at least 5 of the following modules: GI S, MIS, Web Self Service, Asset Management, Maintenance Management, Billing, Met ering, Energy Auditing/Accounting, Customer Care, Network, Hardware in any Utili ty (Power/Gas/Water/Telecom sectors) or infrastructure sector (rail/road/port/ai rport). The total consumer base covered by the SI for such project in the any Ut ility should not be less than 50,000. This requirement is not applicable for inf rastructure sector (rail/road/port/airport) projects as these cater to mass cons umers. In case of a consortium, the requirement of at least 5 modules is distrib uted as follows: SI-Lead needs to meet the above requirement for at least 4 modu les, and the SI-2nd for at least 1 module. (Proof: Necessary Purchase order/LOI/Contract/Certification on client letterhead / Performance certificate as proof of services provided for the last 3 financial years needs to be submitted) vi. The SI should have worked with at least one utility (Power/Gas/Water/Tel ecom sector) or infrastructure sector (rail/road/port/airport) in implementing t urnkey Systems Integration projects. The total worth of projects executed in thi s domain for the last three financial years should be at least INR 50 crore (USD 10 million). In case of a consortium, this requirement needs to be met by the S I-Lead. (Proof: Necessary Purchase order/LOI/Contract/Certification on client letterhead / Performance certificate as proof of services provided for the last 3 financial years needs to be submitted) vii. The SI should be ISO 9001:2000 or have at least CMM/CMMI level 4 certifi cation. In case of a consortium, this requirement needs to be met by SI-Lead. (Proof: Copy of certification from authorized certification body) viii. The SI should have at least 20 personnel on its rolls with a minimum exp erience of 5 years (either in his/her own or other organization). The roles & re sponsibilities of the personnel should include system integration of IT applicat ions or software or hardware or network. In case of a consortium, the requiremen t of at least 20 personnel is distributed as follows: SI-Lead needs to meet the above requirement for at least 15 CVs, and the SI-2nd for at least 5 CVs. (Proof: Signed resume of employees need to be submitted. Scanned signatures shal l be accepted.) VII. Clause D.2 of the RFP deals with the technical proposal. Clause D.2.5 st ipulates that the bidders have to provide details of projects, with application modules and other requirements, as mentioned in eligibility criteria laid down i n Section IV of the RFP, which have been successfully completed during the last 3(three) financial years. Hence the ongoing projects or the projects offered by the bidders, which have not been completed between the financial year 2007-2008 and 2009-2010 would not be considered for technical evaluation. VIII. The RFP further provides that the technical bid has a weightage of 50% a nd the technical evaluation will be done in two stages i.e. Stage 1 - preliminar y evaluation and Stage 2 - distribution of weights on a score of 50. IX. Score 15 allotted for project experience, for the purpose of objective e valuation, is again distributed in 4(four) different sub-heads, namely- • Power Sector Experience (6.5 marks) • Usage of project (2 marks) • Size of GSP, NSP and MDASP (1.5 marks) • IT Experience: Application Modules implemented (5 marks) X. The petitioners’ consortium, apart from other bidders, which includes th e respondent Nos.5 to 8 and who were empanelled by the Nodal Agency, participate d in the said process by submitting their respective technical and price bids. T he technical bids of all the bidders were opened by the Joint Evaluation Committ ee on 16.07.2010. As all the bidders complied with the preliminary requirements i.e. Stage 1, like the availability of the bank guarantee, bid security etc., th e respective solution presentation were viewed and thereafter the technical eval uation process started with assistance of the respondent No.4, the IT consultant , who was one of the consultants empanelled by the Govt. of India selected for t hat purpose. XI. The Joint Evaluation Committee in its proceeding dated 19.08.2010, for t he purpose of proper evaluation of technical bids of various bidders, had decide d to lay down the following criteria:- (a) Only projects of SI would be considered for scoring. (b) Total number of projects to be considered for evaluation would be 8(eigh t). The other options that were discussed and discarded were 3(three) and 5(five ) since these were considered to be less for a project covering 7 States. (c) The projects would be considered for evaluation only if the IT component of the project is at least be 25% of the total project value. This was done sin ce this is primarily an IT project and hence only IT relevant projects should be considered. (d) Though we have asked the bidder to specify which projects to pick up for evaluation, if this not done we would pick up the best projects from the list s ubmitted by them. (e) Only projects with necessary supporting documents would be considered fo r evaluation and scoring. (f) In case of a consortium, project(s) from both the partners would be elig ible for evaluation and the best projects would be picked up for evaluation. XII. The Joint Evaluation Committee in its subsequent proceeding dated 26.08. 2010 found the petitioners’ technical bid as non-responsive, on the ground that the Servers mentioned in the solution write-up/technical proposal does not compl y with the SRS G3 specification of NE RFP. The technical bid of the respondent N o.7 was also found to be non-responsive on different grounds. As required under the guideline issued by the Govt. of India, the said decision was forwarded to t he Nodal Agency, namely, the PFC for approval, by the respondent No.1 vide commu nication dated 27.08.2010 intimating that out of the 7 bidders, 2 bidders, namel y, the petitioners and the respondent No.5 were found to be technically not resp onsive. In the said communication the criteria fixed by the Joint Evaluation Com mittee, in its proceeding dated 19.08.2010 for technical evaluation, have also b een indicated. XIII. The PFC, however, vide communication dated 07.09.2010 informed the respo ndent No.1 about its refusal to approve the rejection of the petitioners’ as wel l as the respondent No.7’s technical bid and send back the matter to review the technical evaluation. In the said communication, the PFC had observed that since there was typographical error in the bid submitted by the petitioners relating to the Server details, the bidder may be given a chance to resubmit the certific ate with reference to any common RFP. The respondent No.1 was also informed abou t the requirement of the adherence to the guidelines issued by the Govt. of Indi a from time to time for bid evaluation including the additional guidelines dated 09.12.2009 and 26.05.2010. XIV. The Joint Evaluation Committee in its proceedings dated 14.09.2010 and 2 4.09.2010 deliberated upon the advice of the PFC and decided to deem all the bid ders as responsive and proceeded to evaluate their technical bids on the basis o f the bench mark fixed by it, on the total score of 50. The Joint Evaluation Com mittee upon due deliberation has found the petitioners’ bid as non-responsive in technical bid evaluation having not scored minimum 35. The marks secured by eac h of the bidders in technical evaluation are reproduced below, in tabular form:- Firm Details CVs G2 Section Project Experience TOTAL Cumulative T/O of firm in Rs.Crs. (Last 3 years) CMM/CMMI Certifi cation Level ISO 9001:2000 No of locations in India Firm Details TOT AL a b c d e = a+b+c+d f g h i = e+f+g+h Max. Score 2 2 2 2 8 6 21 15 50 Omne Agate 0 0 2 2 4.00 4.40 20.22 5.27 33.89 Sterlite 2 0 2 2 6.00 6.00 20.84 0.47 33.31 Spanco 2 1.20 2 2 7.20 6.00 20.84 3.93 37.97 TCS 2 2 2 2 8.00 6.00 20.82 7.15 41.97 MIC 0.80 0 2 1 3.80 6.00 20.89 2.65 33.34 Wipro Ltd. 2 2 2 1 7.00 5.25 20.99 4.82 38.06 HCL I 2 1.20 2 2 7.20 6.00 20.82 7.06 41.06 XV. Accordingly, the Joint Evaluation Committee vide communication dated 25. 09.2010 informed the Nodal Agency, namely, the PFC about its decision intimating that the Joint Evaluation Committee taking note of the Nodal Agency’s advice co ntained in the communication dated 07.09.2010 evaluated the technical bids of al l the bidders including the petitioners and awarded marks on different heads, ba sed on the evaluation criteria and the justification for keeping those criteria as communicated to the PFC vide communication dated 27.08.2010. The relevant por tion of the said communication dated 25.09.2010 is reproduced below:- 3. Bids not meeting the Minimum technical score of 35 (a) PFC recommendation: The Additional Guideline for Technical Bid Evaluation dated 09/12/2009 states t hat Technical score assigned to the System Integrator across the utilities shoul d not vary substantially. Record of Technical score assigned by each state utili ty is available on RAPDRP website. APDCL should review the technical score assig ned to each bidder and should ensure that the same is not in substantial variati on to those of other utilities. It is also proposed that the marks allocated aga inst turnover requirement may be reviewed in case of consortium bidding and aggr egate turnover of all the consortium members need to be considered. (b) Whilst taking note of PFC’s advice, the Joint Evaluation Committ ee noted that while the evaluation criteria and methodology for the country as a whole is the same as per the guidelines of the RAPDRP project, under the very s ame guidelines, certain decisions on evaluation criterion have been left to the States. The evaluation criterion and the justification for keeping these criteri ons for NE R-APDRP Part A bid have been communicated to PFC by APDCL vide letter No.MD/ADPGCL/ PS/Misc/2009/42 dated 27.08.10. It is submitted that the evaluati on and consequent marks awarded to the bidders are based on these evaluation cri teria and there is nothing which the committee can do to modify the marks receiv ed by the bidders based on the evaluation criterion, even if the marks awarded, based on the evaluation criteria are in variation to the marks awarded in other states. (c) With respect to the evaluation of turnover details of the bidder s, in case of the consortium bidders, the Joint Evaluation Committee felt that t here is nothing in the guidelines requiring the bidders financial turnover in ca se of consortium bids to be specifically aggregated. The Joint Evaluation Commit tee also stated that in a number of states where the bids have been awarded, in case of consortium bids, either the turnover of the SI Lead has only been taken or 90-10 weightage has been given as has been done on the instant case. Hence PF C recommendation to specifically mandate this particular modality of the financi al evaluation was not agreed to. XVI. The Nodal Agency, namely, the PFC, thereafter, vide communication dated 27.09.2010 informed the respondent No.1 to go ahead and to open the financial bi ds and to expedite the said process as per guidelines so that the contract can b e awarded at the earliest. The price bids of the bidders, who were found to be r esponsive to the technical bids, were thereafter opened and at this stage the pr esent writ petition was filed challenging the action of the Joint Evaluation Com mittee in rejecting the technical bid of the petitioners. No final order awardin g contract could be passed by the respondent authority because of the interim or der passed on 19.01.2011. 3. I have heard Mr. P.K. Goswami, learned Sr. counsel for the petitioners, Mr. B.D. Das, learned Sr. counsel for the respondent No.1, Mr. Talukdar, learned Addl. Sr. Govt. Advocate, Assam, for the respondent No.2, Mr. R. Sarma, learned Asstt. S.G.I., for the respondent No.3, Mr. D. Baruah, learned counsel for the respondent No.4 and Mr. N. Zaman, learned counsel for the respondent No.5. The o ther respondents have not entered appearance despite service of notice. 4. Mr. Goswami, learned counsel for the petitioners referring to the initia l guideline dated 22.12.2008 as well as the additional guidelines dated 09.12.20 09 and 26.05.2010 issued by the Govt. of India, which are required to be followe d by the Utility in issuing the RFP as well as in evaluation of the technical an d price bids of various bidders, has submitted that though the Utility i.e. resp ondent No.1 issued the RFP on 20.05.2010 detailing the criteria fixed for evalua tion of the technical bids of various bidders in conformity with the said guidel ines, the same, however, was changed by the Joint Evaluation Committee on 19.08. 2010 by introducing another eligibility criteria for evaluation of the technical bids of the bidders to the effect that the projects which have the IT component s of at least 25% of the total project value would be considered, which was done after opening of the technical bids of the bidders on 16.07.2010. According to the learned Sr. counsel, such new eligibility criteria cannot be introduced with out first obtaining the approval from the PFC, the Nodal Agency, as per the guid elines issued by the Govt. of India and in any case after opening of the technic al bids, as has been done in the instant case. It has been submitted that no app roval was sought for and granted by the PFC for introduction of such additional eligibility criteria. It has further been submitted that introduction of such a criteria though was mentioned in the communication dated 27.08.2010 issued by th e Joint Evaluation Committee to the PFC intimating rejection of the technical bi d of the petitioners, on the ground of non-compatibility of the Server, it is ev ident from the said communication that no approval was sought for on such eligib ility criteria subsequently introduced and the same was also not taken note of b y the PFC in its communication dated 07.09.2010 issued pursuant to the communica tion dated 27.08.2010 of the Joint Evaluation Committee. 5. The learned Sr. counsel further submits that even assuming that such add itional eligibility criteria can be introduced by the Joint Evaluation Committee , since score of 15 fixed for project experience was distributed in 4(four) diff erent heads, namely, power sector experience, usage of project, size of GSP, NSP and MDASP and the IT experience: application modules implemented by allotting 6 .5, 2, 1.5 and 5 marks, respectively, the Joint Evaluation Committee at the most may not award any marks in IT experience of the petitioiners, for which 5 marks is allotted, but it has to evaluate the projects offered by the petitioners aga inst other 3(three) sub-heads for the purpose of technical evaluation, and award marks under those sub heads, which has not been done. 6. The learned Sr. counsel further submits that the Joint Evaluation Commit tee in its proceeding dated 19.08.2010 had also decided to consider 8(eight) pro jects while evaluating the technical bids, which was done with a view to give be nefit to the respondent No.5, which