Judicial Intervention To Be Exercised With Caution & Restraint In Matters of State Instrumentalities

M/s.Healthware Private Limited v. Tamil Nadu Medical Services Corporation & Anr., W.P.No.7718 of 2020 and W.M.P.Nos.9075 and 12130 of 2020- 29th October, 2020.

Counsel for Petitioner: Mr.Krishna Srinivasan

Counsel for Respondents: Mr.Vijay Narayan (R1), Mr.P.Giridharan (R2)

The Hon'ble Madras High Court Justice Pushpa Sathyanarayana in a Writ Petition filed under Article 226 of the Constitution of India praying for a Writ of Mandamus directing the first respondent to disqualify the second respondent's technical bid in the tender, for the Supply and Installation of Extracorporeal Shockwave Lithotripsy for Medical College Hospitals at various districts of Tamil Nadu observed that the need for public interest to justify judicial intervention, in matters of contract involving state instrumentalities has to be exercised with caution and restraint.

The Petitioner is a supplier of medical equipments from reputed companies. The first respondent had issued a Notice Inviting Tender in which the tender was for the supply of 4 units of Lithotripters. In the selection of suppliers by local competitive bidding in a two cover system, the last date for receipt of the bid was fixed as 03.12.2019.

It is stated by the petitioner that in the pre-bid meeting, a written representation was submitted by the second respondent, also a bidder, requesting for 11 changes in the tender document, more particularly, on the technical specifications, as the second respondent did not have the model to meet the technical specifications prescribed in the tender document. On 31.12.2019 both the petitioner and the second respondent submitted their bids in two covers containing technical bid and price bid. The technical and commercial bids of the petitioner and the second respondent got accepted. The petitioner submitted a detailed representation that the model quoted by the second respondent did not meet the technical criteria as per the tender document but there was no response from the first respondent. The petitioner once again sent a representation reminding the same after the price bids were evaluated and the second respondent was declared to be L1. Further, as the first respondent has finalized the tender in favour of the second respondent and it only awaits the approval of its Board of Directors, yet another representation was sent. The current writ petition is regarding the same.

In the counter-affidavit, the first respondent has furnished the particulars of their reference to the Specialists and the remarks of the Specialists. Therefore, the objections raised by the petitioner are not sustainable and it is decided that the accepting the bids of both the petitioner and the second respondent is in order. Further, as per Rule 27(3) of the Tamil Nadu Transparency in Tenders Rules, 2000, the petitioner, being the bidder, is prevented from making any attempts to establish unsolicited and unauthorized contact with the Tender Accepting Authority or Tender Inviting Authority, after opening of the tender and prior to notification of award. As admittedly the second respondent was declared as L1, the first respondent sought for dismissal of this writ petition.

The second respondent submitted that the evaluation of the technical bids was done based on the inter-se merits and demerits of the technical bids received and after put to the technical scrutiny by the Experts. The allegation of the petitioner that the technical bid of the second respondent was considered as responsive, in spite of non-compliance of the technical parameters are absolutely baseless. The technical bid was approved and only after the approval of the technical bids of both the petitioner and the second respondent by the Technical Team, the price bids were opened and having failed in the price bid, it is not open to the petitioner to go back on the technical bid and plead for dismissal of the writ petition.

The learned counsel for the petitioner submits that the said Expert Committee consists of two members, but the inspection and evaluation was done only by one of the experts and both had not seen the technical demonstration given by the parties. As the Experts had not given their opinion collectively, it is not open to the first respondent to go by the individual opinion and approve the technical bid of the second respondent. Therefore, it was contended that the selection is only based on the Expert Committee Report and not by the Tendering Authority. The learned counsel for the petitioner relied on the judgment of the Hon'ble Supreme Court in Kanhaiya Lal Agrawal v. Union of India, (2002) 6 SCC 315.

The issue raised before this court based on the contentions is as follows:

1. Whether the second respondent's technical bid should be disqualified as prayed for by the petitioner ?

The learned Advocate General submitted that the tender document is silent about the appointment of the Expert Committee and obtaining their opinion for the purpose of evaluating the technical bid is only optional for the Tender Accepting Authority and it is not open to the petitioner to challenge the same. Though it is argued by the learned counsel for the petitioner that the Expert Report was given only by one of the Experts and not both, in the Affidavit dated 03.08.2020 filed before this Court by the Expert it has been clearly stated that the said report was given by the other expert, on his behalf also, by confirming the earlier report. Hence, there is no merit in the claim of the petitioner in this regard.

When the petitioner is also declared qualified in the technical bid, it cannot have any grievance against the second respondent. Further, it is to be stated once again that it is only based on the Experts opinion and therefore, the petitioner cannot raise any objection. Hence, the argument of the petitioner is held unacceptable in this regard. If the decision of the first respondent is tested with the principles as stated in Montecarlo Ltd. v. NTPC Ltd., (2016) 15 SCC 272 and Raunaq International Ltd. v. I.V.R. Construction Ltd., (1999) 1 SCC 492, it cannot be stated that the decision arrived at by the first respondent suffers from any arbitrariness, irrationality, unreasonableness, bias and mala fides.

The Court hence held that the decision of the first respondent in placing the matter before the Tender Accepting Authority cannot be found to be illegal warranting interference from this Court and it is for the Tender Accepting Authority to consider all points before arriving at a decision accepting or otherwise of the decision of the first respondent.

The Court observed that

"The need for overwhelming public interest to justify judicial intervention in matters of contract involving state instrumentalities has to be exercised with caution and restraint. The authority that is floating the tender is the best judge to decide its requirements. Therefore, interference by Court should be restricted." (Para 18)

Hence, the petition stands dismissed.

M. Maheswari

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