M/S N RAMACHANDRA REDDY versus THE STATE OF TELANGANA & ORS
[2019] 11 S.C.R. 792, Supreme Court of India, 2019
Outcome: Appeal(s) allowed (Granted)
Segment: Ratio
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M/S N RAMACHANDRA REDDY
v.
THE STATE OF TELANGANA & ORS
(Civil Appeal No. 6673 of 2019)
AUGUST 28, 2019
[S. ABDUL NAZEER AND R. SUBHASH REDDY, JJ.]
Tender:
Tender for construction of road –  As per tender condition
‘Batch Type Hot Mix Plant’ owned by the bidder was required to be
located within a distance of 100 kilometers from the last point of
working reach –  Letter of intent issued to the appellant –  Complaint
by another bidder (respondent No.4) disputing the correctness of
distance in the case of the appellant – In verification report
Superintending Engineer found the actual distance at 101.50 km.
and from alternate route found the distance at 99.90 km. –  Finding
in the report again questioned by respondent No. 4 –  By another
verification report by another Superintending Engineer of another
jurisdiction, the distance was found as 98.1 km. –  Tender finalized
in favour of appellant – Writ petition – Single Judge of High court
dismissed the petition – In writ appeal Division Bench of High Court
allowing the appeal found fault with the report of the superintending
Engineer in giving distance particulars from the alternate route and
found that subsequent report not being of jurisdictional engineer
could not have been relied upon – Appeal to Supreme Court – Held:
There is nothing wrong in the first report, mentioning the distance
from alternate route – In the absence of any prescribed procedure
for verification,
it was fair to call for  report from an independent
Superintending Engineer of different jurisdiction – The procedure
adopted by tendering authority is fair, just and reasonable.
Judicial Review:
Scope of judicial review – In matter relating to contracts and
tenders – Held: In matter relating to contracts/tenders, courts cannot
sit as appellate court while exercising power of judicial review –
Such power is called for only if the approach is arbitrary or mala
fide or procedure adopted is meant to favour someone.
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Letters Patent:
Intra-court appeal – Power of court – Scope of – Held:
Appellate Bench not to disturb the finding of Single Judge unless
such finding is concluded as perverse.
Constitution of India:
Art. 136 – Jurisdiction under – Nature of – Held: Jurisdiction
u/Art. 136 is corrective jurisdiction to settle the law.
Allowing the appeal, the Court
HELD: 1.1 It is clear from the condition relating to work in
question, which is to be construed as essential, that the bidder
shall own a ‘Hot Mix Plant’ within a distance of 100 kilometers
from the last point of working reach. As per clause 22.6 of the
tender conditions, the result of evaluation of Part-I of the bids
shall be made public on e-procurement systems, following which,
there shall be a period of five working days, during which, any
bidder may submit complaint, which shall be considered, before
opening Part-II of the bid. Once a complaint is filed, there is no
definite procedure prescribed as to how such complaint is to be
dealt. [Para 29][804-G; 805-A-B]
1.2 In the present case, it is clear from the material on
record that, when a complaint is filed by the fourth respondent/
writ petitioner, after evaluation of Part-I of the bids, at first
instance, a report is prepared by the Superintending Engineer,
Warangal dated 30.05.2018, stating that as per the route given
by the appellant, distance is 101.50 kilometers and if measured
from the alternate route it comes to 99.90 kilometers. It is the
specific
case of the appellant that it has not made any request for
measuring the distance from the alternate route. In view of the
variation in distance, from its earlier report, it appears, the Chief
Engineer has requested the Superintending Engineer,
Karimnagar, to verify and report. The Superintending Engineer,
vide his report dated 04.07.2018, informed the Chief Engineer
that he has measured the distance from the ‘odometer’ and the
distance between the Hot Mix Plant and the last point of working
reach was 98.1 kilometers. Accepting the said report, bid of the
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appellant was opened and it is clear from the record that the offer
of the appellant is nearly Rupees Twenty Lakh less than the rate
quoted by the fourth respondent/writ petitioner.  [Para 29][805-
B-E]
1.3 There is no dispute that appellant owns a ‘Hot Mix
Plant’, as required in the tender conditions. It is his specific case
that the location of such Hot Mix Plant is within 100 kilometers,
as required. It is true that when a complaint is made by the fourth
respondent/writ petitioner, it was found that the distance is 101.50
kilometers from one route and 99.90 kilometers from the other
route. From the alternate route, shown in the report dated
30.05.2018, submitted by the Superintending Engineer, Warangal,
it is at a distance less than 100 kilometers. There is nothing wrong
in the first report, mentioning the distance from the alternate
route. In view of such discrepancy in the report, the Chief
Engineer has further called for a report from the Superintending
Engineer, Karimnagar, an independent authority, who has further,
after re-verification, submitted a report dated 04.07.2018, stating
that the distance is only 98.1 kilometers. [Paras 32, 33] [806-B-
D]
1.4 There is no definite procedure for verification, in the
event of any complaint filed by any of the bidders, as contemplated
under clause 22.6 of the tender conditions. In absence of any
prescribed procedure for verification, it was fair on the part of
the
Chief Engineer to call for a report from an independent
Superintending Engineer i.e. the Superintending Engineer,
Karimnagar. Such a procedure adopted by the Chief Engineer
was fair and cannot be said to be either illegal or arbitrary. The
Division Bench of High Court has committed an error, in
recording a finding that, calling for a report from the
Superintending Engineer, Karimnagar, by the Chief Engineer, is
not in accordance with the procedure. [Paras 29, 32, 33, 34]
[806-E-G]
Poddar Steel Corporation v. Ganesh Engineering Works
(1991) 3 SCC 273 : [1991] 2 SCR  696; BSN Joshi &
SWons Ltd. v. Nmair Coal Services Ltd. and Ors (2006)11
SCC 548 : [2006] 8 Suppl. SCR 11; Bakshi Security
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and Personnel Services Pvt. Ltd. v. Devkishan Computed
Private Limited and others (2016) 8 SCC 446 : [2016]
3 SCR 310; Central Coalfields Limited and others v.
SLL-SML and others (2016) 8 SCC 622 : [2016] 4 SCR
890 – distinguished.
2.1 The State’s decision/action must be in consonance of
Article 14 of the Constitution of India. It is specifically held that
courts cannot sit as appellate court while exercising power of
review in matters relating to contracts and tenders. Exercise of
power of judicial review is called for, if the approach is arbitrary
or mala fide or procedure adopted is meant to favour someone.
The scope is confined to examine only the decision-making
process and not the merits of the decision itself.  [Paras 35, 37]
[807-A-B, D]
2.2 The procedure adopted by the tendering authority in
the present case is fair, just and reasonable. In absence of any
specific mala fides and grant of exemption from any essential
conditions of tender, authorities have acted within their authority,
as such, it cannot be construed either as a relaxation or violation
of tender conditions. [Para 39][807-F]
Tata Cellular v. Union of India (1994) (6) SCC 651 :
[1994] 2 Suppl. SCR 122; Afcons Infrastructure Limited
v. Nagpur Metro Rail Corporation Limited (2016) (16)
SCC 818 : [2016] 3 SCR 551; Consortium of Titagarh
Firema Adler v. Nagpur Metro Rail Corporation Ltd.
(NMRCL) (2017) (7) SCC 486 : [2017] 5 SCR 337;
Municipal Corporation, Ujjain and Anr. v. BVG India
Ltd. & Ors (2018) (5) SCC 462 : [2018] 6 SCR 861 –
relied on.
Raunaq International Ltd. v. I.V.R Constructions Ltd
(1999) (1)  SCC  492 : [1998] 3 Suppl.  SCR  421; The
Silppi Constructions Contractors v. Union of India and
Anr. Etc. Etc. (2019) (11) SCALE 592 – referred to.
3. In the intra court appeal unless Appellate Bench
concludes that findings of the Single Judge are perverse, it shall
not disturb the same. [Para 43] [808-F]
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Management of Narendra & Company Pvt. Ltd. v.
Workmen of Narendra & Company (2016) 3 SCC 340 :
[2016] 1 SCR 597 – relied on.
4. The power conferred on this Court, under Article 136 of
the Constitution of India, is the corrective jurisdiction to settle
the law. As the issue in the present case does not relate to strict
construction of territorial jurisdiction, it is always open for the
decision-making authority, to have a report from the independent
authority, to arrive at the just decision. [Para 42][808-C, E]
Pritam Singh v. State AIR 1950 SC 169 : [1950] SCR
453; Penu Balakrishna Iyer & Ors. v. Ariya M.
Ramaswamy Iyer & Ors. AIR 1965 SC 195 : [1964]
SCR 49; Shaikh Ali Hossain & Ors. v. Shaikh Showkat
Ali & Anr. (2008) 8 SCC 180 : [2008] 8 SCR 867 –
referred to.
Case Law Reference
[1998] 3 Suppl.  SCR  421
referred to
Para 24
2019 (11) SCALE 592
referred to
Para 24
[1994] 2 Suppl. SCR 122
relied on
Para 35
[2016] 3 SCR 551
relied on
Para 36
[2017] 5 SCR337
relied on
Para 37
[2018] 6 SCR 861
relied on
Para 38
[1991] 2 SCR  696
distinguished
Para 40
[2006] 8 Suppl. SCR 11
distinguished
Para 40
[2016] 3 SCR 310
distinguished
Para 40
[2016] 4 SCR 890
distinguished
Para 40
[1950] SCR  453
referred to
Para 43
[1964]  SCR  49
referred to
Para 43
[2008] 8 SCR 867
referred to
Para 43
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CIVIL APPELLATE JURISDICTION: Civil Appeal No. 6673
of 2019.
From the Judgment and Order dated  13.03.2019  of the  High
Court  for the State of Telangana at Hyderabad in Writ Appeal No. 153
of 2019.
B. Adinarayana Rao, Sr. Adv., Sumanth Nookala, Praveen Reddy,
Advs. for the Appellant.
R. Basant, Sr. Adv., S. Udaya Kumar Sagar, Ms. Swati Bhardwaj,
Sadineni Ravi Kumar, M. Sudheer Kumar, Advs. for the Respondents
The Judgment of the Court was delivered by
R. SUBHASH REDDY, J.
1. Leave granted.
2. This civil appeal is filed by the fourth respondent in Writ Appeal
No. 153 of 2019, aggrieved by the order dated 13.03.2019, passed by
the High Court for the State of Telangana at Hyderabad, allowing intra
court appeal, filed under clause 15 of the Letters Patent.
3. The fourth respondent herein was the writ petitioner in Writ
Petition No. 23501 of 2018, on the file of High Court of Judicature for
the State of Telangana at Hyderabad, wherein it has challenged the
award of work of “construction of BT Road from Gujed to Buddaguda,
in Mahabubabad District of Telangana State”. Writ Petition filed under
Article 226 of the Constitution of India was dismissed by the learned
Single Judge, vide order dated 25.02.2019, against which, Letters Patent
Appeal was preferred under clause 15 of the Letters Patent. The Division
Bench of the High Court by order dated 13.03.2019 allowed the intra
court appeal, which order is impugned in this appeal.
4. Necessary facts in nutshell, for
disposal of this appeal are as
under:
The Roads and Buildings Department of the First Respondent-
State of Telangana, floated a tender notice dated 21.04.2018, inviting
bids for construction of “BT Road from Gujed to Buddaguda, in
Mahabubabad District of Telangana State”. Tender is floated by Standard
Bidding Document for Road Connectivity Project for Left Wing
Extremism Affected Areas (RCPLWEA) for construction and
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Maintenance - issued by the National Rural Roads Development Agency,
Ministry of Rural Development, Government of India. The appellant
and the fourth respondent participated in the tender process by submitting
the requisite documents. As per the tender conditions, there is a
requirement to furnish necessary certificates from the District Officers
of R & B Department to exhibit proof of owning “Batch Type Hot Mix
Plant” of capacity 100-120 TPH and that such “Batch Type Hot Mix
Plant” shall be located within a distance of 100 kilometers from the last
point of working reach, for which, bids are invited. The relevant clause
in the tender document under Clause 4.4 B(b) reads as under:-
“Each bidder must demonstrate:
(i) “availability for construction work, either owned, or on lease or
on hire, of the key equipment (except Batch Type Hot Mix
Plant) stated in the Appendix to ITB including equipments required
for establishing field laboratory to perform mandatory tests, and
those stated in the Appendix to ITB;
Note: For Batch Type Hot Mix Plant, as per G.O.Rt. No.211,
T.R&B(R.1)Dept., Dt.21-04-2018
(a)
The bidders shall exhibit proof of owning “Batch Type Hot
Mix Plant” of capacity 100-120 TPH and such Batch Type
Hot Mix Plant shall be located within a distance of 100
Kms from the last point of working reach for which bids
are invited.
(b)
The bidders to furnish necessary certificates from the
concerned District Officers of
R & B where such plants
have been located and the District Officers of R & B shall
inspect and certify with route maps on the (1) location (2)
distance from last point of work reach and (3) ownership
of such plants for which the bidders are intending to bid.
 (c)
The Superintendent Engineer of R & B concerned shall
ensure the veracity of such certificate/documents uploaded
by the bidders in support of the eligibility criteria on
machinery before finalizing the technical evaluation of the
bids.”
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5. The Bid Document consists of two parts, Part-I & Part-II i.e
technical bid and price bid respectively.
6. Pursuant to tender notice, there were two offers by the bidders
i.e the fourth respondent as well as the appellant herein. The technical
bids were opened on 18.05.2018 at 04:00 P.M. and as the fourth
respondent as well as the appellant were qualified in the technical bid,
the Part-II bid i.e the price bid was opened on 31.05.2018 at 03:00 P.M.
7. In the price bid, the fourth respondent herein, offered to execute
the work at the cost of Rs.31,51,27,865.82 whereas, the appellant offered
the cost of Rs.31,31,69,427.04 for executing the work. As much as the
offer made by the appellant was lowest, the Letter of Intent was issued
to the appellant.
8. As per the tender conditions, the appellant herein has produced
the document issued by the Executive Engineer, Roads and Buildings
Department, Mahabubabad Division, showing distance from the “Batch
Type Hot Mix Plant” to that of the site at 99.05 kilometers. Disputing
correctness of such distance, the fourth respondent/writ petitioner has
on 18.05.2018, filed a complaint before the concerned authority i.e. the
Chief Engineer. On such complaint, the Chief Engineer, called for a
verification report from the Superintending Engineer, R & B Circle,
Warangal. As per the report dated 30.05.2018 submitted by the
Superintending Engineer, the actual distance between the Hot Mix Plant
and the last point of working
reach was shown at 101.50 kilometers. In
the same report, the Superintending Engineer, Warangal, has also
mentioned that the distance when measured from an alternate route, the
actual distance from the Hot Mix Plant to the last point of working reach
comes to 99.90 kilometers.
9. In view of the dispute raised by the fourth respondent again,
about the correctness of distances mentioned in the report submitted by
the Superintending Engineer, Warangal, the Chief Engineer vide his letter
dated 11.06.2018, requested the Superintending Engineer, Karimnagar,
to verify the distance between the location from the point of Hot Mix
Plant, owned by the appellant, to that of the last point of working reach
of the site in question.
10. Vide report dated 04.07.2018, the Superintending Engineer,
Karimnagar informed the Chief Engineer that the distance between the
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Hot Mix Plant, owned by the appellant and the last point of working
reach is 98.1 kilometers.
11. In the report dated 04.07.2018, filed by the Superintending
Engineer, Karimnagar, addressed to the Chief Engineer, as the distance
between Hot Mix Plant owned by the appellant and the last point of
working reach was shown at 98.1 kilometers, same was accepted by
the authorities and tender was finalized in favour of the appellant. The
fourth respondent has questioned the same by way of Writ Petition filed
under Article 226 of the Constitution of India.
12. The learned Single Judge of the High Court has held that in
absence of any specific mala fides against any individual, the re-
verification undertaken, about the distance, by the Chief Engineer, is not
illegal. Learned Single Judge has observed that when the tender conditions
permit the tenderer to make objection, which obviously, require
consideration, by necessary implication, permit the tendering authority
to re-verify and re-consider the material submitted before him. It is
observed that when the fourth respondent has raised an objection against
the certificate issued in favour of the appellant, no fault can be attributed
to the authorities in getting the re-verification done and obtaining a report
from an independent authority. Having found that there is no illegality or
arbitrariness on the part of the authorities, in decision-making process,
learned Single Judge
dismissed the Writ Petition vide order dated
25.02.2019.
13. When the said order is questioned by way of intra court appeal
under clause 15 of the Letters Patent, the Division Bench of the High
Court has found fault with the report of the Superintending Engineer,
Warangal, to the extent in giving distance particulars from the alternate
route. Further, it is observed that when the report of the Superintending
Engineer, Warangal, was not accepted, the Chief Engineer should not
have sought a second report from the Superintending Engineer,
Karimnagar. In the order it is stated that the jurisdictional Engineer is
Superintending Engineer, Warangal but not Superintending Engineer,
Karimnagar. It is stated in the order that since the report submitted by
the Superintending Engineer, Karimnagar was not legally justified, as
such, it could not have been relied on to finalize tender in favour of the
appellant.
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14. On the aforesaid grounds, the Division Bench allowed the
intra court appeal, by impugned order, with a direction to award the
work in question, on the basis of a report submitted by the Superintending
Engineer, Warangal.
15. Heard Sri B.Adinarayana Rao, learned senior counsel
appearing for the appellant, Sri R. Basant, learned senior counsel
appearing for the fourth respondent/ writ petitioner and Sri S.Udaya
Kumar Sagar, learned counsel appearing for the State.
16. It is contended by Sri B.Adinarayana Rao, learned senior
counsel, appearing for the appellant that as per the tender conditions,
bidder must demonstrate proof of owning ‘Batch Type Hot Mix Plant’
of the capacity of 100-120 TPH, which shall be located within a distance
of 100 kilometers from the last point of working reach, for which, bids
are invited. As per the tender conditions, bidders are required to furnish
necessary certificates, issued by the District Officers of R & B
Department.
17. It is not in dispute that the appellant owns a Hot Mix Plant and
at the request of the appellant, the District Officers have issued a
certificate. The said certificate was to be filed along with ‘Part A’ of the
documents, relating to technical bid.
18. It is submitted that, as per the tender conditions, the result of
evaluation of Part-I of the bids shall be made public on e-procurement
systems, following which, there will be a period of five working days,
during which any bidder may submit complaint
which shall be considered
for resolution before opening Part-II of the bid.
19. It is contended that in this case, initially a certificate was
furnished by the concerned District Officer of R & B Department,
showing the distance below 100 kilometers but when a complaint is filed
by the fourth respondent/writ petitioner, verification was done by calling
a report from the Superintending Engineer, Warangal.
20. It is submitted that Superintending Engineer, on its own, has
certified in his report dated 30.05.2018 that as per the original route, the
distance is 101.50 kilometers and by alternate route, the distance is 99.90
kilometers, as per the Google map.
21. It is further submitted that apart from the said certification, an
independent report is also called for from the Superintending Engineer,
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Karimnagar, which is reported vide report dated 04.07.2018, showing
the distance between the ‘Hot Mix Plant’ owned by the appellant and
the ‘last point of working reach’ of the work in question, at 98.1 kilometers.
It is submitted that when a complaint is filed by the fourth respondent in
terms of Para 22.6 of the Standard Bidding Document, it is always open
for the authorities to call for a report from the independent authority
other than the officers concerned in the circle/division in question.
22. It is submitted by learned counsel that accepting the report
submitted by the Superintending Engineer, Karimnagar, the price bid was
opened and the appellant has offered to execute the work at a cost of
Rs.31,31,69,427.04, as against the cost quoted by the fourth respondent
which is  Rs.31,51,27,865.82. In view of dispute raised by the fourth
respondent, the Chief Engineer concerned has sought re-verification of
the distance from the Superintending Engineer, R & B Circle, Karimnagar,
who, vide report dated 04.07.2018, based on the Trip Meter of the vehicle,
had categorically opined that the Hot Mix Plant of the appellant was
located within 100 kilometers. It is submitted that there being no specific
mala fides, tendering authority opened the price bid only after satisfying
the distance being less than 100 kilometers.
23. It is submitted that as per the tender conditions, there is no
prescribed procedure for
verification, in the event of any complaint by
one of the bidders, in terms of Para 22.6 of the Standard Bidding
Document. It is submitted that the learned Single Judge has rightly refused
to exercise the jurisdiction under Article 226 of the Constitution of India
as much as there is no illegality or arbitrariness in the decision-making
process. It is submitted that the well reasoned order of the learned Single
Judge is interfered in the intra court appeal by impugned order, without
assigning valid reasons and findings recorded in the impugned order run
contrary to the tender conditions.
24. In support of his arguments, Sri B. Adinarayana Rao, learned
senior counsel, has relied on the following judgments:
1. Tata Cellular v. Union of India.1
2. Raunaq International Ltd. v. I.V.R Constructions Ltd.2
1 1994(6) SCC 651.
2 1991(1) SCC 492.
3 2016(16) SCC 818.
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3. Afcons Infrastructure Limited v. Nagpur Metro Rail
Corporation Limited.3
4. Consortium of Titagarh Firema Adler v. Nagpur Metro Rail
Corporation Ltd. (NMRCL).4
5. Municipal Corporation, Ujjain and Anr. v. BVG India Ltd.
& Ors.5
and also judgment of this Court, in the case of The  Silppi
Constructions Contractors v. Union of India and Anr. Etc. Etc.6
25. On the other hand, Sri R.Basant, learned senior counsel,
appearing for the fourth respondent/writ petitioner states that there are
no grounds to interfere with the impugned order passed by the Division
Bench of the High Court. It is submitted that the Superintending Engineer,
Warangal, in his report dated 30.05.2018, has shown the distance at
101.50 kilometers, and at the same time, on his own, also mentioned the
distance to be at 99.90 kilometers measured from an alternate route. It
is further submitted that the Chief Engineer has committed error in calling
the report from the Superintending Engineer, Karimnagar, who is not the
concerned jurisdictional Superintending Engineer. When it is found that,
as per the initial certificate submitted by the appellant, which shows the
distance to be more than 100 kilometers, there is no reason or justification
either to go by the distance, as measured from the alternate route in the
report dated 30.05.2018, or to go by another report of the Chief Engineer,
which is based on the information furnished by the Superintending
Engineer, Karimnagar.
26. Finally, it is
submitted by Sri R. Basant, learned senior counsel
that there are no grounds to interfere in the impugned order in this appeal,
filed under Article 136 of the Constitution of India.
27. In support of his arguments, Sri R.Basant, learned Senior
counsel has also relied on the following judgments:
1. Poddar Steel Corporation v. Ganesh Engineering Works.7
5 2018(5) SCC 462.
6  SLP(c) Nos. 13802-13805 of 2019 decided on 21.06.2019.
7 (1991)3 SCC 273.
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2. BSN Joshi & SWons Ltd. v. Nmair Coal Services Ltd. and
Ors.8
3. Bakshi Security and Personnel Services Pvt. Ltd. v.
Devkishan Computed Private Limited and others.9
4. Central Coalfields Limited and others v. SLL-SML and
others.10
Further, he has also relied on the following judgments:
5. Pritam Singh v. State.11
6. Penu Balakrishna Iyer & Ors. v. Ariya M. Ramaswamy
Iyer & Ors.12
7. Shaikh Ali Hossain & Ors. v. Shaikh Showkat Ali & Anr.13
wherein, the scope of interference by this Court is discussed under
Article 136 of the Constitution of India.
28. Having heard the learned senior counsels on both sides, we
have carefully perused the impugned order passed by the Division Bench
of the High Court and the order passed by learned Single Judge and
other material placed on record.
29. From a reading of the tender conditions relating to work in
question, it is clear that the bidders shall exhibit proof of owning “Batch
Type Hot Mix Plant” of capacity of 100-120 TPH and such plant shall
be located within a distance of 100 kilometers from the last point of
working reach, for which, bids are invited. In proof of owning such a
plant within 100 kilometers, bidders are required to obtain necessary
certificates from the concerned District Officers of R & B Department,
where such plants have been located and the District Officers of R & B
Department shall inspect and certify with route maps on the location;
distance from the
last point of work reach; and ownership of such plants,
for which, bidders are intending to bid. It is clear from the aforesaid
condition, which is to be construed as essential, that the bidder shall own
a ‘Hot Mix Plant’ within a distance of 100 kilometers from the last point
of working reach. As per clause 22.6 of the tender conditions, the result
8 (2006)11 SCC 548.
9 (2016)8 SCC 446.
10 (2016)8 SCC 622.
11 AIR 1950 SC 169.
12 AIR 1965 SC 195.
13 (2008)8 SCC 180.
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of evaluation of Part-I of the bids shall be made public on e-procurement
systems, following which, there shall be a period of five working days,
during which, any bidder may submit complaint, which shall be considered,
before opening Part-II of the bid. It is clear from the aforesaid clause
under tender document, if any of the bidder disputes the distance quoted
by other bidder, it is open for such bidder to make a complaint, which
shall be considered, before opening of Part-II of the bid. Once a complaint
is filed, there is no definite procedure prescribed as to how such complaint
is to be dealt. In the case on hand, it is clear from the material on record
that, when a complaint is filed by the fourth respondent/writ petitioner,
after evaluation of Part-I of the bids, at first instance, a report is prepared
by the Superintending Engineer, Warangal dated 30.05.2018, stating that
as per the route given by the appellant, distance is 101.50 kilometers and
if measured from the alternate route it comes to 99.90 kilometers. At
this stage, it is to be mentioned that, it is the specific case of the appellant
that it has not made any request for measuring the distance from the
alternate route. In view of the variation in distance, from its earlier report,
it appears, the Chief Engineer has requested the Superintending Engineer,
Karimnagar, to verify and report. The Superintending Engineer, vide his
report dated 04.07.2018, informed the Chief Engineer that he has
measured the distance from the ‘odometer’ and the distance between
the Hot Mix Plant and the last point of working reach was 98.1 kilometers.
Accepting the said report, bid of the appellant was opened and it is clear
from the record that the appellant has quoted offer to execute the work
in question at Rs.31,31,69,427.04 whereas, the fourth respondent has
quoted at Rs.31,51,27,865.82 to execute the work. The offer of the
appellant is nearly Rupees Twenty Lakh less than the rate quoted by the
fourth respondent/writ petitioner.
30. The learned Single Judge, by observing that there being no
specific mala fides against any individual, has held that, no fault can be
attributed to the Chief Engineer in getting the re-verification done, by
obtaining a report from the independent authority. Further, by recording
a finding that the scope of interference in the matter relating to tenders,
in exercise of power conferred under Article 226 of the Constitution of
India, is confined to decision-making process only, has dismissed the
Writ Petition.
31. From a reading of the impugned order, it appears that the
Division Bench has reversed the order of the learned Single Judge, only
on the ground that the report received from the Superintending Engineer,
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Karimnagar, is not in accordance with the procedure. The Division Bench
of the High Court has also held that the Chief Engineer had stepped out
of his jurisdiction, when he called a report from the Superintending
Engineer, Karimnagar.
32. We are not convinced, with such a view, as expressed above,
by the Division Bench of the High Court. First of all, it is to be noticed
that there is no dispute that appellant owns a ‘Hot Mix Plant’, as required
in the tender conditions. It is his specific case that the location of such
Hot Mix Plant is within 100 kilometers, as required. It is true that when
a complaint is made by the fourth respondent/writ petitioner, it was found
that the distance is 101.50 kilometers from one route and 99.90 kilometers
from the other route. From the alternate route, shown in the report dated
30.05.2018, submitted by the Superintending Engineer, Warangal, it is at
a distance less than 100 kilometers.
33. We find nothing wrong in the first report, mentioning the
distance from the alternate route. In view of such discrepancy in the
report, the Chief Engineer has further called for a report from the
Superintending Engineer, Karimnagar, an independent authority, who has
further, after re-verification, submitted a report dated 04.07.2018, stating
that the distance is only 98.1 kilometers. To make sure whether the plant
of the appellant is within the distance of 100 kilometers or not, in
compliance of
the tender conditions, in view of the dispute raised by the
fourth respondent/writ petitioner and the report dated 30.05.2018, the
Chief Engineer got re-verified from an independent authority by addressing
to Superintendent Engineer, Karimnagar. In absence of any prescribed
procedure for verification, it was fair on the part of the Chief Engineer
to call for a report from an independent Superintending Engineer i.e. the
Superintending Engineer, Karimnagar. There is no definite procedure
for verification in the event of any complaint filed by any of the bidders,
as contemplated under clause 22.6 of the tender conditions. The Division
Bench has committed an error, in recording a finding that, calling for a
report from the Superintending Engineer, Karimnagar, by the Chief
Engineer, is not in accordance with the procedure.
34. Having regard to the nature of dispute, it was always open for
the Chief Engineer to call for a report from an independent authority i.e.
Superintending Engineer, Karimnagar. Such a procedure adopted by the
Chief Engineer was fair and cannot be said to be either illegal or arbitrary.
Such a report is made basis in the decision-making process, to open the
bid of the appellant in Part-II.
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35. In the case of Tata Cellular v. Union of India1, while
considering the scope of judicial review, in matters relating to Government
contracts-tenders, this Court has held that the State’s decision/action
must be in consonance of Article 14 of the Constitution of India. The
scope is confined to examine only the decision-making process and not
the merits of the decision itself. It is specifically held that courts cannot
sit as appellate court while exercising power of review in matters relating
to contracts and tenders.
36. In the case of Afcons Infrastructure Limited v. Nagpur
Metro Rail Corporation Limited and Another3, this Court found fault
in the High Court, in interfering with the decision of the authority in a
matter relating to contracts and tenders, without there being any mala
fides or irrationality or perversity in the procedure adopted by the
authorities.
37. In the case of Consortium of Titagarh Firema Adler v.
Nagpur Metro Rail Corporation Ltd.4, while considering the scope of
judicial review, in matters relating to power of contracts, this Court has
held that exercise of power of judicial review is called for, if the approach
is arbitrary or mala fide or procedure adopted is meant to favour someone.
38. Further, in the case of Municipal Corporation, Ujjain and
Anr. v. BVG India Ltd. & Ors.5, this Court has held that, while
considering the scope of judicial review, in matters relating to contracts,
it is held that the same is restricted to
decision-making process but not
the decision itself. It is held that the High Court cannot act as appellate
court to review tender evaluation and set aside the award of tender.
39. All the judgments referred above, support the case of the
appellant, as much as, we are of the view that the procedure adopted by
the tendering authority is fair, just and reasonable. In absence of any
specific mala fides and grant of exemption from any essential conditions
of tender, authorities have acted within their authority, as such, it cannot
be construed either as a relaxation or violation of tender conditions.
40. The learned senior counsel, Sri Basant, appearing for the fourth
respondent/writ petitioner, has relied on the judgments in the case of
Poddar Steel Corporation v. Ganesh Engineering Works7, BSN Joshi
& SWons Ltd. v. Nmair Coal Services Ltd. and Ors8 Bakshi Security
and Personnel Services Pvt. Ltd. v. Devkishan Computed Private
Limited and Ors.9; Central Coalfields Limited and others v. SLL-
SML and others10, in support of his arguments that the essential clauses
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of a tender should be enforced strictly and no deviation is permissible
under law.
41. We are of the view that the above said judgments have no
application to the facts of this case, for the reason that, it is not a case of
violation of any tender conditions. Further, pleading that no case is made
out by the appellant for interference under Article 136 of the Constitution
of India, learned counsel, in support of his argument, has relied on
judgment in the case of Pritam Singh v. State11; Penu Balakrishna
Iyer & Ors. v. Ariya M. Ramaswamy Iyer & Ors.12; Shaikh Ali
Hossain & Ors. v. Shaikh Showkat Ali & Anr.13
42. With reference to the same, it is to be noticed that the power
conferred on this Court, under Article 136 of the Constitution of India, is
the corrective jurisdiction to settle the law. Further, it is to be noticed
that when the learned Single Judge of the High Court has found that the
process of re-verification done by the Chief Engineer, on the dispute in
question, is fair and acceptable for arriving at a decision, but the Division
Bench has set aside such order, only on the ground that the report is
called for from the Superintending Engineer, Karimnagar, who is not the
concerned Engineer, as per the procedure. In absence of any prescribed
procedure to deal with complaints, it was fair on the part of the Chief
Engineer, in calling a report from the independent authority, other than
the jurisdictional
officers. As the issue does not relate to strict construction
of territorial jurisdiction, it is always open for the decision-making authority,
to have a report from the independent authority, to arrive at the just
decision.
43. Further, in the case of Management of Narendra & Company
Pvt. Ltd. v. Workmen of Narendra & Company14, while considering
the scope of the intra court appeal, this Court has held that, unless
Appellate Bench concludes that findings of the learned Single Judge are
perverse, it shall not disturb the same.
44. For the aforesaid reasons, we allow this appeal and set aside
the order dated 13.03.2019 passed in Writ Appeal No. 153 of 2019, by
the High Court of Telangana at Hyderabad and confirm the order dated
25.02.2019 passed by the learned Single Judge in Writ Petition No. 23501
of 2018. No order as to costs.
Kalpana K. Tripathy
Appeal allowed.
14 (2016) 3 SCC 340