Case: Shroff and Company and Other Vs. Food Corporation of India and Other

By these writ petitions, the petitioners have impugned award of contract dated 19th August, 1994 by respondents No. 1 to respondent No. 2 appointing respondent No. 2 as SCHT contractor at Jawaharlal Nehru Port for handing sugar vessels for a period of one year from 20th August, 1995 as more particularly set out therein. The petitioners have impugned the award of the said contract by food corporation of India to M/s. Jesia Mistry Private Limited mainly on the ground that M/s. Jesia Mistry Private Limited did not satisfy the conditions of eligibility prescribed by the relevant "invitation to tender" referred to hereinafter. The petitioners have invoked Article 14 of Constitution of India and have made an allegation to the effect that the respondent No. 2 in these petitions has been favoured by respondent No. 1 by relaxation of conditions of eligibility as set out in the advertisement issued by respondent no. 1 and the accompanying invitation to28th June, 1994, Food Corporation of India, caused an advertisement to be published in Times of India and other newspapers inviting tenders for appointment of clearing and forwarding contractor at Bombay Port/ Jawaharlal Nehru port for handing of imported sugar for a period of one year from the date of appointment, It was stated in the said adcvertisement that the job involved stevedering, clearing, forwarding, loading and transportation of imported sugar begs inside the docks at Bombay Port Trust/Jawaharlal Nehru Port for wagon dispatches etc.. It was stated in the said advertisement that the tenderer should have minimum experience of three years in handing foodgrains/sugar at Bombay Port/Jawaharl as Nehru Port. In the said advertisement,it was further stated that the tenderers could produce consent letter from a slevedoring licence holder. The said advertisement shall have to be read alongwith invitation to tender issued by Food Corporation of India in this behalf. A copy of detailed "invitation to tender" is annexed as annexure `B to Writ Petition No. 3335 of 1994. By the said invitation to tender, it was stipulated that the last date for receipt of tenders was upto 11.15 hrs. on 8th july, 1994 and the tender would be opened at 11.30 hours on 8th july, 1994. The said invitation to tender provided special definition for sake of convenience. The respondent no. 1 in terms provided in the said invitation to tender as under."The term "Foodgrains" shall mean and include foodgrains products of foodgrains, fertilisers, sugar groundnut, pods, oil seeds, etc. "(Note: The entire definition of the expression `Foodgrains is not reproduced herein for the sake of brevity)It was thus a term of the said invitation to tender that the tenderer having minimum experience of three years in handing fertilisers at Bombay Port/Jawaharl as Nehru Port were also eligible to submit the requisite tender. In view of the special definition of the expression "foodgrains" provided in the above referred invitation to tender itself, it must be held that the minimum experience of handing fertilisers at Bombay Port/Jawaharl as Nehru Port was prescribed as condition of eligibility for submission of the tender by the interested parties in terms of the above referred invitation to tender.4.On 7th July, 1994 the petitioner in Writ Petition No. 3335 of 1994, shown as M/s. Vilas Transport Co. submitted their tender for the above referred work alongwith various documents. On 7th July, 1994, the respondent No. 2 also submitted its tender to the Food Corporation of India Alongwith various documents. Both the parties have considerable experience of handing such jobs at the port. A copy of covering letter dated 7th July, 1994 addressed by respondent No. 2 in these petitions to the Regional Manager(Maharashtra) of Food Corporation of India alongwith all the annexures appended there to is annexed asto the affidavit of Shri Mahesh Chandra Tawari, Sr.. Regional Manager (Maharashtra) of Food Corporation of India being affidavit dated 2nd september, 1994 filed in Writ Petition No. 3156 of 1994. It is very clear from the annexures to the said letter dated 7th July, 1994 that during the years93 andthe respondent No. 2 had in fact handled and transported bulk materials like MOP/DAP as well as Sulphur Rock Phosphate. alongwith the said tender dated 7th July, 1994 the respondent No.2 forwarded a statement of bulk cargo handled by respondent No. 2 in respect of above referred items during all these years i.e. for period of more than three years. The above referred statement of respondent No. 2 is duly supported by certificates dated 5th June, 1993 issued by Jawaharlal Nehru Port Trust and Rashtriya Chemicals and Fertilizers Limited (Exhibit21) to the said affidavit. The genuineness of these certificates is not disputed. In covering letter dated 7th July, 1994, the respondent no. 2 further stated that bit nereky the respondent No. 2 but also their associates in their group of companies had been doing stevedoring job at Bombay Harbour for past 50 years in the name of M/s. HilsonDinshaw Ltd. There are common directors in respondent No.2 as well as M/s Hilsondinshaw Ltd. In the said letter, the respondent No.2 also referred to the experience of their other associate concerns as well hust to imptess respondent No. 1 about their competence to handle the cargo.In the said covering letter, a reference is to be found to successful handing of the contract awarded to respondent No. 2 by am/s. Rashtriya ChemicalsFertilisers Ltd., in the past. The petitioners in Writ Petition No. 3156 of 1994 have themselves referred to the above referred fact of respondent No. 2 having experience of handling Rock Phosphate etc. in the petition itself. The writ petitioners have averred in para 7 of the petition that it is well known that the repondent No.2 handles "rock phosphate" The petitioner in Writ Petition No. 3335 of 1994 have made similar admission in the writ petition. M/s. ShroffCo., the writ petitioners in Writ Petition No. 3156 go 1994 did not submit any tender. The schedule to the Fertiliser (Control) Order, 1985 issued under Essential Commodities Act, 1955 refers to the items like MOP,DAP and sulphur rock as fertilisers. The statutory order is not applicable foe interpreting the contractual documents herein. A reasonable clue is however available from the schedule to the Fertiliser(Control) Order, 1985 so as to indicate that the above referred items could reasonably be considered by Food Corporation of India as fertilizers. This is enough for our purpose. The Court is not required to decide as to whether the experience of handling the above referred items at the port amounts to "experience of handling fertilizers" within meaning of inviation to tender referred to hereinabove. The question to be asked is as to whether the view taken by respondent no. 1 to the effect that the experience of handling the above a referred item in bulk could be equated to experience of handing fertilisers is a reasonably possible view. The answer to this question must be in affirmative. The petitioners have shown total ignorance of the above referred definition clause contained in the invitation to tender referred to hereinabove.5.On 8th July, 1994, the concerned tenders were opened, by respondent No. 1 It appears that (1) M/s. Jesia Mistry Agencies Private Limited, (2) M/s. J.M. BaxiCo and (3) M/s. Vilas Transport Co., had submitted their tenders in pursuance of invitation to tender.6.The Food Corporation of India decided to enter into negotiations with all the three tenderers. A committee was committee was constituted by the competent authority. The telex message was sent to all the tenders on 20th July 1994. The negotiations were carried on between the committee and all the tenderers on 21 July, 1994. It is of considerable significance to refer to the minutes of the negotiations held on 21st July, 1994 (Exhibitto the affidavit of shri Mahesh Chandra Tewari dated 2nd September, 1994). M/s. J.M. BaxiCo. went out of the race on their own volition. The above referred negotiations were therefore, pursued only between M/s. Vilas Transport Co. and M/s. jesia Mistry Agencies Private Limited at the level of the Committee appointed by respondent No.1 It appears from the copy of the minutes of meeting held that M/s. Vilas Transport Company had quoted the lowest rate for certain items of services required to berendered at the port and M/s. Jesia Mistry Agencies private Limited had quoted the lowest rate for some other items. The Food Corporation of India took the view that it was not possible to divide that work against a particular ship between the two tenderers. The committee decided to form a panel of two contractors. The committee decided that the lowest tender for certain items of service of M/s Vilas Transport Company be offered to m/s. Jesoa mistry Agencies Private Limited and that lowest rate of m/s. Jesia mistry Agencies private Limited be be offered to M/s. Vilas Transport Company. It is of considerable significance that both the tenderers agreed top accept the proposals formulated by the Committee of respondent No. 1 and confirmed to be on the panel of stevadariong contractors and work out the arrangement at the negotiated rates. Even confirmation letters were issued by both the tenderers as set out in the minutes of the meeting dated 22nd July, 1994 (Exhibit25th july 1994, the Zonal Manager (west) addressed a letter to the Senior Regional manager (Maharashtra), Food Corporation of India conveying the approval of the competent authority to accept the negotiated rates as per details set out therein and award the contract both to M/s. Vilas Transport Company as well as to m/s. Jesia Mistry Agencies private Limited and appoint them on the panel of contractors. By the said letter it was directed that M/s. Vilas Transport Company may be appointed as SCHT contractors on panel to undertake the contract work by the first referred vessel arriving at Jawaharlal Nehru Trust. As regards m/s. Jesoa Mistry Agencies private limited was concerned, it was directed by the Zonal Manager that the appointment letter be issued to the said party after verifying CHF licence, consent letter from the jawaharlal nehru port, no objection certificate from Jawaharlal Nehru port and Mathadi Board Regulations. The respondent No. 2 complied with all the condition on fulfilment of which the appoint letter was to be released.8.On 26th july 1994, the Food Corporation of india issued as order appointing M/s. Vilas Transport Company on a panel of contractors for handing import sugar vessels for the period commencing from 22nd July, 1994,until 28th 1995 i.e. acontract with liberty to the Food Corporation of India to appoint other contractor. M/s. Vilas Transport Company themselves have admitted this fact in para 13 of the petition in as many words. Messrs. Vilas Transport Company acted upon the saidarrangement finalised in meeting dated 22nd July, 1994 as aforesaid.9.M/s. Vilas Transport Company operated two vessels between 30th July, 1994 to 20th August, 1994 as set out in para 13 of Writ Petition No. 3335 of 1994.10.M/s. Jesia Mistry Agencies private Limited complied with all the stipulated conditions like obtaining no objection certificate from Jawaharlal Nehru Port as well as from the Clearing and Forwarding Unprotected Dock Labour Board. In the situation, the letter of appointment was released by the Food Corporation of india to M/s. jesia Mistry Agencies Private limited on 19th August, 1994. The said letter of apppointment is impugned by the two writ petitioners in this petition.11.M/s. ShroffCo., did not submit the tender at all. M/s. ShroffCo., made a grievance in Writ Petition No. 3156 of 1994 to the effect that the petitioners therein would have submitted necessary tender if the petitioners knew that the condition of eligibility prescribed in the advertisement dated 20th June, 1994 was likely to be relaxed. It is the case of the respondents that the prescribed condition of eligibility was never relaxed and it is unfortunate that write petitioners have totally ignored the definition of the expression "foodgrains" forming part of "invitation tender" and have filed write petitions in this Court which are not all maintainable in law.12.Soon after filing of this Writ Petition No. 3156 of 1994, Mahesh Chandra Tewari filed his second affidavit alongwith copies of all the documents produced by both the petitioners on 2nd September, 1994. The statements made in the said affidavit are acceptable to the Court. It must be stated here and now that the first affidavit of Shri Mahesh Chandra Tewari dated 25the August, 1994 was totally inadequate and capable of having misleading effect on the mind of the Court as no reference is to be found in the said affidavit to the definition of the expression "foodgrains" in invitation to tender so as to include "Fertiliser". In para 7 of the said first affidavit it was stated that the respondent No. 2 herein had produced certificates showing that M/s. HillsonDinshaw Ltd., a sister concern of respondent No.2 had experience of handling of foodgrains for more than three years without saying anything more. Copies of all the documents submitted by respondent No. 2 to respondent No. 1 alongwith the tender were filed only with affidavit of the said deponent on 2nd September, 1994. Perhaps for want of time or want of proper concentration on the relevant definition in invitation to tender, this aspect of the case was missed by respondent No. 1 at the initial stage. It in now classified to the satisfaction of the Court that the reliance on experience of M/s. HilsonDinshaw Ltd. by respondent No. 2 was not meant to satisfy the condition of eligibility is respondent No. 2 itself but was merely as an additional fact to impress upon respondent No. 1 about the competence of respondent No. 2 and several of their associate concerns to perform the job.

Court's reasoning:
2.For the reasons set out hereinafter, we have reached the conclusion that there is no merit in these petitions. The petitions are accordingly dismissed.orders passed by this Court stand vacated with immediate effect. We have reached the conclusion that the respondent No.1 was entitled to take the view that the respondent No.2 satisfied conditions of eligibility and was an eligible tenderer. The impugned decision is not proved to be arbitrary. It is of significance that M/s. ShroffCo. did not submit the tender and M/s. Vilas Transport Company were virtually a consenting party to the constitution of a panel by respondent No. 1 and the award of work to Vilas Transport Company as well as respondent No. 2 on nonexclusive basis. Both the petitions show utter ignorance about the definition provided in the relevant invitation to tender to the effect that minimum experience of handing fertilizers at the specified period shall be considered on par with the experience of handing `foodgrains at the specific parts. There is no justice in the case of theregard to facts of this case as discussed below and the applicability of ratio of judgement of Supreme Court in the case of Tata Cellular v. Union of India, J.T. (1994) 4 S.C. 532, we have decided to dismiss theseif the draftsman of the first affidavit of the deponent missed to concentrate on all the terms of the invitation to tender, we cannot ignore the unimpeachable documents submitted with the tender which are all annexed to the second affidavit i.e. affidavit dated 2nd September, 1994. The Court is bound to scrutinise the issue as to condition of eligibility with reference to the advertisement issued by respondent No. 1 and the accompanying invitation to tender i.e. the twoare not impressed by this submission. The jurisdiction of the Court to interfere in these matter is rather limited. After considering all the relevant material on record, we have reached the conclusion that the Food Corporation of India could reasonably take a view to the effect that all the items at the part referred to herein above amounted to handling of fertilizers and the respondent No. 2 did satisfy the condition of eligibility. No case for interference of this Court on this aspect of the unnecessaryare of the opinion that M/s. Vilas Transport Company filed Writ Petition No. 3335 of 1994 merely to take a chance and as an afterthought so as to persuade respondent No. 1 to award the entire contract to them. In our opinion, the petitioners in this writ petition have missed to concentrate deliberately or unintentionally on the relevant terms of invitation to tender referred to hereinabove and have approached this Court with an incomplete and defective case as discussed above. The Court is bound to construe `invitation to tender as a composite document and read it in entirety.15.It is not possible to take the view that the respondent No. 2 did not have requisite minimum experience of handling fertilizers at the port as required by conditions of invitation to tender. We hold that the respondent No. 2 had the requisite minimum experience. We hold that the respondent No. 2 did satisfy the condition of illegibility. It is not possible to take the view that the respondent No. 1 acted arbitrarily or in breach of its obligation under Article 14 of the Constitution of India. In our opinion, the respondent No. 1 acted fairly and is the manner it was entitled to act inthe principles of the above referred case and applying the principles of law laid down by the Apex Court in the case of Sterling Computers Limited v. MN. Publications Limited, referred to hereinbefore, we hold that no case whatsoever is made out for intervention of this Court under Articles 226 of the Constitution of India and there is no merit whatsoever in the petition. The terms of invitation of invitation to tender are not open to judicial scrutiny and bind the parties. It any be that the expression `foodgrain in common parlance does not include the item of fertiliser. It was open to the petitioner to stipulate that the experience of handling fertilisers at the specified port shall also be considered by respondent No. 1 as enough in respect of eligibility of to submit theare satisfied that the committee of Food Corporation of India acted bona fide. The writ jurisdiction is discretionary. The alleged violation of Article 14 of the Constitution of India is not proved. The impugned contract dated 19th August, 1994 was not awarded to respondent No. 2 as a result of any bias or malafide or arbitrariness. The respondent No. 1 was entitled to take the view that a panel should be constituted of both the tenderers and both the tenderers who are quire experienced in the line should be awarded contract onand on the basis of negotiated rates. In light of our finding and conclusions as discussed above we hold that there is no merit in these petitions.