Siemons Pub.Commun.Netwroks P.Ld.& ... vs Union Of India & Ors

3. The factual position in a nutshell is as follows.

Respondent No. 2, Bharat Electronics Ltd. was nominated by respondent No. 1, Ministry of Defence, Government of India, as the prime contractor for Indian Army's modernization plan for Technical Communication System (in short the `TCS'). Respondent No. 2 floated a Request for Proposal (RFP) for procurement of Digital Radio Trunking System (in short the `DRTS'), also popularly known as Terrestrial Trunked Radio (in short the `TETRA') which is a major component in the TCS Programme of the Indian Army, vide Tender No. DRTS/AREN/Jan-2005. In 2 the RFP floated by respondent No. 2 for the DRTS, the vendors were called upon to make firm technical and commercial proposals for the supply and transfer of technology of DRTS to respondent No. 2 for incorporating in their solution to Indian Army. It was specified that the commercial offers should be for quantities of 80 systems as per Bill of Material enclosed with RFP.

The technical specifications detailed the components of the DRTS by splitting them into 9 sub-systems. The tender also stipulated that the licensed manufacture of DRTS shall be undertaken by respondent No. 2 through a Transfer of Technology (in short the `ToT') for both hardware and software by executing a ToT Agreement between the vendor and respondent No. 2.

In terms of the tender document, the evaluation, trials and completion of the contract was proposed to be carried out in five phases spread over a period of time. Phase-I comprised a Preliminary Evaluation of Vendor Proposal and technical analysis, including presentations to be made by the vendors as also clarifications to be provided on questions raised during the presentations and subsequent analysis to the Technical 3 Evaluation Committee (in short the `TEC') for being shortlisted for the Phase-II evaluations. Phase-II evaluations comprised the visits of the empowered technical team to assess the vendor system at the vendor premises to assess the technical capability, encryption, implementation, confirmation of essential parameters and suitability of equipment as per RFP, demonstration of system capability, mock up installation at the location of the vendors and vendors found qualified by the above criteria were to be shortlisted for Phase-III evaluation.

On 8th February, 2005, a pre-bid meeting was held by respondent No. 2 where the prospective bidders were apprised of the contents and basic requirements of the tender. In March 2005, eight bidders, including appellant No.1 submitted their bids in response to the RFP. Phase-I evaluation was carried out by the TEC which shortlisted six bidders for Phase-II evaluation. Phase-II evaluation was carried by the Empowered Technical Committee (in short the `ETC'), which after visiting the factory sites of the six qualified bidders, including appellant No.1 recommended three vendors, namely, petitioner No. 1, respondent No. 3 (/M/s. Selex Communications SpA (M/s. Selex) and M/s. Thales Land & Joint Systems (M/s. Thales) for Phase-III evaluation. In Phase-III evaluation, field trials, maintainability evaluation trials, EMI/EMC testing and discussions on feasibility etc. were held and further evaluation trials were carried out. After approval of the Technical Committee's report, all the three bidders as referred to hereinabove, qualified for Phase-IV evaluation and clearance was accorded for the next phase of evaluation. In Phase-IV, 5 commercial bids were opened on 23rd January, 2007 in the presence of the representatives of all three bidders and the prices of the main items as per their commercial bids were read out. The total price of the three bidders worked out as under :

According to appellants, since respondent No.2 was not announcing the name of L-1 tenderer, they wrote to the respondents on 16.2.2007 inter alia stating that though the price bid had been opened more than three weeks back the name of L-1 had not yet been announced. On the basis of read out price of all the three bidders on 23.1.2007, the appellant No. 1 had emerged as the lowest bidder and was, therefore, entitled to be intimated the results of the tender. Grievance was made that they did not get any response from the respondent No. 2 and, therefore, they sent a reminder on 22.2.2007. Finally, by letter dated 23.2.2007 a response was received from respondent No. 2 acknowledging their representation but the outcome of the tender was not intimated. Therefore, the writ petition was filed. The prayers, as set out in the writ petition have been noted above. In essence the appellants wanted respondent No. 2 to award the tender in their favour being the lowest bidder. Counter-affidavits were filed. During the course of the hearing of the writ petition, a preliminary objection was raised regarding non-impleadment of two other bidders and they were impleaded on the oral request of the appellants.

It was further stated that conditions of the tender were not violated and all the guidelines as per CVC were followed scrupulously while arriving at a package price considering the complete requirement of RFP and there is no genuine grievance of the writ petitioners giving rise to any cause of action in their favour. The writ petitioner has indulged in deliberate distortion and contortion of facts and misrepresented the settled law in this regard.

5. The appellants disputed the above position and it was stated that the appellant No. 1's bid was the lowest of the 3 technical qualified bidders whose commercial bids were opened and appellant No. 1 was being ousted by adding an imaginary price of EU 11 billion to its bid, which the 8 appellants never quoted and addition to its bid was unwarranted and amounted to artificially loading the bid. It was in essence stated that so far as Item No. 11 is concerned, a wrong view was taken on the basis of absurd reasoning. The addition of EU 11 billion to the bid of the appellants on account of Item No. 11 has resulted in increasing its total bid to EU 28 billion which, on the face of it, is absurd.

6. Further the stand of respondent No. 2 was that the appellants could have sought necessary clarification in this regard, as was done by them in the case of other issues raised on 7.2.2007.

7. In the course of arguments the appellants stated that they were willing to provide software for 1200 users for the price quoted in the bid, i.e., for EU 8977.34. The respondents, as noted above, disputed the factual scenario as narrated by the appellants and they specifically stated that different stands have been taken at different points of time by the writ petitioners to suit their own purpose. Therefore, there was no scope for interference considering the limited scope of judicial review, particularly when, no malafides have been alleged or pleaded. The High Court by the impugned judgment dismissed the writ petition.

94. The principles deducible from the above are:

30. There was no scope for respondent No. 2 to read into the documents, terms and conditions which did not exist in the bid documents. The appellants have also not levelled any personal allegations of malafides or favouritism against respondent No. 2.

35. In the instant case, as has been rightly contended by the learned Addl. Solicitor General appearing for Union of India, the contract is in respect of sensitive Army equipments which are urgently needed. It cannot be held that the process adopted or decision made is so arbitrary or irrational that no responsible authority acting reasonably or in accordance with the relevant law could not have taken such a decision. The inevitable conclusion is that the appeal is devoid of any merit and deserves dismissal, which we order. However, there shall be no order as to costs.

36. Appeal dismissed.