HON'BLE SRI JUSTICE C.V. NAGARJUNA REDDY W.P.No.10404 of 2013 dated:5-7-2013 Balaji Transport,Represented by its Managing PartnerV. Mallikarjuna Rao, Tadepalligudem, West Godavari District and another... Petitioners The State of Andhra Pradesh,Represented by its Principal Secretary,Civil Supplies Department, Secretariat,Hyderabad and others ... Respondents Counsel for petitioners : Sri S. Ramachandra Rao, Senior Counsel for Sri K.R. Prabhakar Counsel for respondent No.1 : -- Counsel for respondent Nos.2 & 3 : Sri A. Ravinder Reddy, Standing Counsel Counsel for respondent No.4 : -- Counsel for respondent No.5 : Sri A. Ravi Shankar Counsel for respondent Nos.7 & 8 : Sri N. Siva Reddy <GIST: >HEAD NOTE: ?CASES REFERRED: 1. 1993(1) SCC 478 2. 1999(5) ALT 47 3. 2008(1) ALT 715 4. 2013(1) ALT 412 5. (1994) 3 SCC 1 6. (2007(2) SCC 1 7. 1959 Supp.(1) SCR 528 8. 1973(4) SCC 225 9. 1996(11) SCC 39 10. 2005(3) ALT 252 (FB) 11. 2012(3) SCC 619 12. 1984(3) SCC 161 13. 2005(4) SCC 120 14. 1989(2) SCC 691 15. (2012) 8 SCC 216 16. 2007(14) SCC 517 17. (2013) 1 SCC 524 18. (1974) 4 SCC 3 19. 1979(3) SCC 165 20. (2005) 7 SCC 764 21. (1976) 1 SCC 800 22. (1986) 4 SCC 566 23. (2010) 4 SCC 192 24. (1993) 1 SCC 445 25. (1994) 6 SCC 651 26. (1999 1 SCC 492 27. 2002(2) SCC 617 28. 2005(1) SCC 679 29. (2006) 11 SCC 548 30. (2007) 14 SCC 517 31. 1986 (Supp.) SCC 285 32. AIR 1998 S.C. 795 HON'BLE SRI JUSTICE C.V. NAGARJUNA REDDY W.P.No.10404 of 2013 Date : 5-7-2013 Between: Balaji Transport, Represented by its Managing Partner V. Mallikarjuna Rao, Tadepalligudem, West Godavari District and another .. Petitioners and The State of Andhra Pradesh, Represented by its Principal Secretary, Civil Supplies Department, Secretariat, Hyderabad and others .. Respondents Counsel for petitioners : Sri S. Ramachandra Rao, Senior Counsel for Sri K.R. Prabhakar Counsel for respondent No.1 : -- Counsel for respondent Nos.2 & 3 : Sri A. Ravinder Reddy, Standing Counsel Counsel for respondent No.4 : -- Counsel for respondent No.5 : Sri A. Ravi Shankar Counsel for respondent Nos.7 & 8 : Sri N. Siva Reddy The Court made the following: JUDGMENT:
The petitioners, whose tenders were rejected following technical evaluation, approached this Court by way of the present Writ Petition with two fold grievance, namely, (i) that their tenders were unauthorisedly and illegally disqualified and (ii) that respondent No.2 has mala fide withdrawn tender notification dated 20-2-2013 (for short "the first notification") and issued a fresh notification dated 15-3-2013 (for short "the second notification") with a view to help respondent Nos.4 to 8 to become eligible for participating in the tender process.
The brief facts leading to the filing of this Writ Petition are stated hereunder:
Respondent No.2, the A.P. State Civil Supplies Corporation Limited, issued the first notification inviting tenders for undertaking work relating to transportation of Palmolien oil pouches in cartons from Kakinada (East Godavari District) and Krishnapatnam (SPSR Nellore District) Ports to various Mandal Level Stock (MLS) Points in the Districts under various zones for the year 2013-
14. As per the tender schedule, the last date and time for receipt of bids was 11-3-2013 at 5 p.m., the technical tender opening date was 12-3-2013 at 11 a.m. and commercial tender opening was fixed for 12-3-2013 at 3.30 p.m. On the date fixed for opening of technical tenders and commercial tenders i.e., 12-3-2013, the Managing Director of respondent No.2-Corporation issued a corrigendum cancelling the first notification. Three days later i.e., on 15-3-2013, respondent No.2-Corporation has issued the second notification. The petitioners have participated in the tender process under both the tender notifications. As per schedule of the second notification, 1-4-2013 was fixed for opening of technical and commercial tenders. On opening the tenders, respondent No.2- Corporation has disqualified both the petitioners on the ground that they do not satisfy Clause 3.2(f) of Instructions to Tenderers, A-General, of the Notice Inviting Tenders (NIT) which prescribed minimum annual turnover of Rs.3 crores for the tenderers.
Respondent Nos.4 to 8, who have filed tenders in response to the second notification, have been technically qualified. Before a decision on the acceptance of the tenders was taken by respondent No.2-Corporation, the petitioners approached this Court by way of the present Writ Petition. By order dated 4-4-2013, this Court has directed respondent Nos.2 and 3 not to finalise the contract in pursuance of the second notification.
Counter-affidavits have been filed on behalf of the official and the private respondents.
I have heard Sri S. Ramachandra Rao, learned Senior Counsel for the petitioners, Sri A. Ravinder Reddy, learned Standing Counsel for the A.P. State Civil Supplies Corporation Limited-respondent No.2 and Sri A. Ravi Shankar, learned counsel for respondent No.5 and Sri N. Siva Reddy, learned counsel appearing for respondent Nos.7 and 8.
The learned Senior Counsel for the petitioners made the following submissions:
(i) That respondent No.2 has acted arbitrarily in disqualifying the petitioners' tenders on the purported ground of their not satisfying the requirement of the annual minimum turnover of Rs.3 crores; that though the petitioners, which are partnership firms have not achieved the turnover in their names, their partners satisfied the turnover requirement and that the decision of respondent No.2 is contrary to the settled legal position in New Horizons Ltd., Vs. Union of India1, S. Kireetendranath Reddy Vs. A.P. Transco2, M.V.V. Satyanarayana Vs. Engineer-In-Chief3 and PBR Select Infra Projects Vs. Commissioner of Tenders4.
(ii) That the action of the official respondents in withdrawing the first notification is mala fide, in that, respondent No.2 intended to confer undue favour on respondent Nos.4 to 8, who were disqualified under the first notification as they were Stage-1 contractors by withdrawing the said notification and issuing the second notification by removing the bar on participation of Stage-1 contractors in the tender process. Reliance is placed on New Horizons Ltd. (1-supra), S.R. Bommai Vs. Union of India5, I.R. Coelho Vs. State of Tamil Nadu6, Basheshar Nath Vs. Commissioner of Income-Tax7, Kesavananda Bharati Vs. State of Kerala8, Shree Mahavir Oil Mills Vs. State of Jammu & Kashmir9, Md. Abdul Azeez Asad Vs. State of A.P.10, Manohar Joshi Vs. State of Maharashtra11, Bandhua Mukti Morcha Vs. Union of India12, Commissioner of Endowments Vs. Vittal Rao13, and Andi Mukta Sadguru Shree Muktajee Vandas Swami Suvarna Jayanti Mahotsav Smarak Trust Vs. V.R. Rudani14. Opposing the above submissions, Sri A. Ravinder Reddy, learned Standing Counsel for respondent No.2, made the following submissions:
(i) That the decision taken by respondent No.2 disqualifying the petitioners, does not suffer from any arbitrariness or mala fides. He further stated that the first notification was withdrawn in view of the changed circumstances, namely, rearrangement of the Zones and with a view to facilitate timely dispatches of Palmolien Oil to the MLS points. He further submitted that the petitioners failed to lay any foundation for mala fides and that the plea of mala fides is liable to be thrown out as vague and unsubstantiated as the petitioners failed to implead the officials concerned as parties to the Writ Petition;
(ii) that respondent No.2 having taken the decision to withdraw the first notification, issued the second notification in the best interests of the Corporation and hence interference by this Court with such a decision is not called for; and
(iii) that having participated in the second tender process, the petitioners waived their right to question the tender conditions. In support of his submissions, he has relied upon the Judgments in Michigan Rubber (India) Ltd. Vs. State of Karnataka15 Jagadish Mandal Vs. State of Orissa16, and Ratnagiri Gas and Power Pvt. Ltd. Vs. RDS Projects Ltd.17.
Sri N. Siva Reddy, learned counsel for respondent Nos.7 and 8, supplemented the submissions of Sri A. Ravinder Reddy. Sri A. Ravi Shankar, learned counsel for respondent No.5, has adopted the arguments of both the learned counsel.
Having regard to the respective pleadings of the parties, the following Points arise for consideration:
1. Whether the decision of respondent No.2-Corporation to disqualify the petitioners' tenders is legal and proper?
2. Whether the decision of respondent No.2-Corporation in withdrawing the first notification and issuing the second notification by removing the bar of participation of Stage-I contractors in the tender process is arbitrary and vitiated by mala fides? and
3. Whether the petitioners waived their right to question the tender conditions? Re Point No.1: Clause 3 of the NIT deals with the qualification requirements of the tenderers. Clause 3.2 thereof, which is relevant for the present purpose, reads as under:
The tenderer shall furnish the following particulars in the formats provided online and supported documentary evidence shall be uploaded.
(a) Attested copies of documents relating to the Registration in case of a firm.
(b) Partnership deed should be in existence for minimum three years.
(c) Articles of Association.
(d) Latest Income Tax Clearance certificate/latest IT return and PAN number from IT Department for the last three years.
(e) Affidavit in prescribed format.
(f) Minimum turnover should be 3(three) crores per year. (Emphasis added) The phrase "tenderer" in the above reproduced Clause is material in judging the qualification requirements of the tenderers. Undisputedly, the petitioners are partnership firms which have no legal entity, for, a partnership is a compendium of partners. In New Horizons (1-supra), a similar tender condition fell for consideration of the Supreme Court. While rejecting the contention that the firm in its name does not have the experience, the Supreme Court observed at para-23 as under:
"Even if it be assumed that the requirement regarding experience as set out in the advertisement dated April 22, 1993 inviting tenders is a condition about eligibility for consideration of the tender, though we find no basis for the same, the said requirement regarding experience cannot be construed to mean that the said experience should be of the tenderer in his name only. It is possible to visualize a situation where a person having past experience has entered into a partnership and the tender has been submitted in the name of the partnership firm which may not have any past experience in its own name. That does not mean that the earlier experience of one of the partners of the firm cannot be taken into consideration...."
In S. Kireetendranath Reddy (2-supra), this Court has considered an identical case where the A.P. TRANSCO declined to consider the minimum annual financial turnover of the partners of the firm. In para-18 of the Judgment, this Court held as under:
"It is well settled that a firm is not a legal entity, but is only a collective or compendious name for all partners. It is neither a legal entity nor a person. A firm has no legal existence apart from its partners. A firm name is really a description of the individuals who compose it. The essential characteristic of a firm is that each partner is a representative of the other partners. Each of the partners is an agent and a principal. He is an agent in so far as he can bind the other partners by his acts within the scope of the partnership business and he is principal to the extent that he is bound by the acts of the other partners. The liabilities of the firm can be enforced against each of the partners personally."
While following the Judgment in New Horizon's case (1-supra), the learned Judge has held at paras 24, 25 and 32, as under :
"An examination of the above propositions of law and the authorities clearly goes to show that a partner when he acts in all matters which are within the scope and objects of the partnership, he steps into the shoes of the firm, which is a personified person but not a legal person in popular language, and binds all other partners, who compose it by his acts.
Since a firm does not have its own distinct and separate personality apart from the personality of partners who compose it, no experience can be attributed to it in law, and the so called personified experience of a firm, in reality, is nothing but the experience of the partners who compose it. ...
Therefore, we find a clear ratio in the judgment of the Supreme Court delivered in the NHL's case (supra) that the experience of a constituent of a legal person like an incorporated company or even that of a partner of a firm should be taken to be the experience of the company or the firm, as the case may be, for the purpose of consideration of the tenders, and what is material is whether the applicant for award of the contract has persons with experience and not the name which the applicant bears...."
In M.V.V. Satyanarayana Vs. Engineer in Chief (3-supra), I had an occasion to deal with a similar situation where the balance sheet filed by the individual partners was not considered to the firm's credit. In paragraph-24, I have made the following observations:
"When a firm is represented by its partner, there is nothing in law which separates him from the firm which he represents, as the firm has no legal entity. In this perspective the name which does not spell any magic is not so much material, but it is the composition of the firm which is material for, the partner of a firm steps into the shoes of the firm."
In P.B.R. Select Infra Projects (4-supra), I had another occasion to deal with a similar question. I have reiterated the settled legal position at para-7 as under:
"...The law is well settled that a partnership firm has no separate legal existence as the firm is nothing but a compendium of its partners. In S. Kireetendranath Reddy Vs. A.P. Transco-1999 (5) ALT 47, this Court has extensively dealt with the status of a partnership firm in law vis-a-vis its partners and held that a firm is neither a legal entity nor a person; that it has no legal existence apart from its partners; that a firm's name is merely a description of the individuals who composed it; that the essential characteristic of a firm is that each partner is a representative of the other partners; and that each of the partners is an agent and a principal. On a thorough analysis of the provisions of the Indian Partnership Act, 1932 (for short "the Partnership Act") with reference to the decided case law, this Court has nullified the action of the A.P. Transco in that case in disqualifying the petitioner therein by not taking into consideration the experience of the firm as his experience as a partner therein."
It is not in dispute that if the turnover of the partners of the petitioners' firms is considered, the requirement under Clause 3.2(f) of the NIT stands satisfied. Indeed, interestingly, in para-15 of the counter-affidavit, respondent No.2, which has admitted that in respect of transport contracts relating to red-gram and chilly powder, it has considered the turnover of the partners while considering the tenders filed in the name of the partnership firms, sought to distinguish between the two contracts on the ground that the present contract pertains to high quality Palmolien oil and therefore the two contracts cannot be equated. In my opinion, this distinction has no legal basis as the legal position does not vary with the value or importance of a contract. The position of a firm in a contract pertaining to red-gram and chilly powder will be the same in a contract relating to Palmolien oil, or any other commodity, for that matter. After initial resistance, Sri A. Ravinder Reddy, learned Standing Counsel, has finally given-in by fairly conceding that in view of the well settled legal position, respondent No.2 has committed a serious legal error in not considering the turnover of the petitioners' as that of the petitioners.
As noted hereinbefore, if the partners' turnovers are considered, the petitioners satisfied Clause 3.2(f) of the NIT. The decision of respondent No.2-Corporation, to this extent, cannot, therefore be sustained in law. This Point is accordingly answered in favour of the petitioners. Re Point No.2: The scope of the contract in question involves transportation of Palmolien oil pouches in cartons from the Kakinada and Krishnapatnam Ports to various MLS points. For this purpose, the State is divided into different Zones. In the first notification, the Districts were assigned to different Zones, which were apportioned between the Kakinada and Krishnapatnam Ports, in the following manner:
District Zone Port Srikakulam, Vizianagaram and Visakhapatnam I Kakinada East Godavari, West Godavari and Khammam II Kakinada Krishna, Guntur and Prakasam III Kakinada Adilabad, Karimnagar and Nizamabad VI Kakinada Nalgonda, Mahaboobnagar and Warangal VII Kakinada Medak, Ranga Reddy and Hyderabad VIII Kakinada Nellore, Chittoor and Kadapa IV Krishnapatnam Kurnool and Anantapur V Krishnapatnam It is discernible from the above Table that 6 Zones and 18 Districts were entrusted to the Kakinada Port and 2 Zones and 5 Districts were entrusted to the Krishnapatnam Port. In the second notification, the Zones and the Districts have been substantially revised. The revised Zones and apportionment of these Zones between the two Ports can be seen in the following Table: District Zone Port Srikakulam, Vizianagaram and Visakhapatnam I Kakinada East Godavari, West Godavari, Krishna and Khammam II Kakinada Nizamabad, Adilabad, Warangal and Karimnagar VI Kakinada Prakasam and Guntur III Krishnapatnam Nellore, Chittoor and Kadapa IV Krishnapatnam Anantapur and Kurnool V Krishnapatnam Nalgonda and Mahaboobnagar VI Krishnapatnam Ranga Reddy, Hyderabad and Medak VIII Krishnapatnam From the above reproduced revised arrangement, it can be seen that only 3 Zones with 11 Districts were entrusted to the Kakinada Port while 5 Zones with 12 Districts were entrusted to the Krishnapatnam Port. It is in this context that the contents of the counter-affidavit of the respondent Nos.2 and 3, need to be considered. While refuting the allegation that the first notification was withdrawn and the second notification was issued by deleting the bar on Stage-I contractors with a view to favour them with the award of contracts, it is specifically averred in the counter-affidavit that keeping in view the feasibility aspects, the Districts which are near to the Krishnapatnam Port have been entrusted to the said Port by modifying the Zones and that to ensure timely dispatches of Palmolien Oil to the MLS Points, the Corporation felt that the services of Stage-I contractors can also be availed by permitting them to participate in the tender process if they satisfy the tender conditions. In this context, the concept of Stage-I contractors needs to be briefly explained. The essential commodities such as rice and other food grains meant for public distribution are stored in the Food Corporation of India (FCI) godowns. These food grains are transported to reach the ultimate destination i.e., fair price shops, in two stages. Under the first stage, the food grains are transported from the FCI godowns to the MLS Points and in the second stage, they are transported from the MLS Points to the fair price shops. In the counter-affidavit it is pleaded that from the present year, the Corporation is thinking of doing away with the two-stage system of transport by calling for unified tenders. Even though it is not specifically explained in the counter- affidavit, at the hearing, the learned Standing Counsel for respondent No.2- Corporation, submitted that for the first time, respondent No.2 barred the Stage-I and Stage-II contractors from participating in the tenders for transportation of Palmolien oil and that in view of the Corporation's proposal to do away with the dual stage contract system from this year, it has thought it fit to remove the ban on participation of Stage-I contractors and also to ensure timely dispatches to the MLS Points, respondent No.2-Corporation felt that involvement of Stage-I transport contractors will help accomplishing the task of dispatching the Palmolien oil in a time-bound manner. I must say that the explanation of respondent No.2-Corporation is somewhat sketchy and they should have been more specific in explaining the reason for cancellation of the first notification and issuance of the second notification, with modifications. However, if we read corrigendum dated 12-3-2013 closely, the intention of respondent No.2 can be culled-out. The said corrigendum reads as under:
"The P.Oil Tenders called the NIT No.Mktd./M6/1044/P.Oil Tenders/2013-14 dtd.22- 02-2013 are herewith cancelled due to modification of Zones to facilitate timely P.Oil movement to the districts for smooth functioning of distribution of subsidized P. Oil to BPL families through PDS in the State".
The first notification was evidently cancelled due to modification of the Zones. Respondent No.2 appeared to have thought it fit to remove the ban on Stage-I contractors also, following modification of the Zones. Whatever the reasons might be, the petitioners have failed to properly plead, much less, establish that the cancellation of the first notification and permitting the Stage-I contractors to compete with others is with a view to help Stage-I contractors in general and the private respondents in particular. In E.P. Royappa Vs. State of Tamil Nadu18, the Apex Court held : "...The allegations of mala fides are often more easily made than proved and the very seriousness of such allegations demands proof of a high order of credibility..."
In order to succeed in establishing the allegations of mala fides, it is necessary that not only that the pleadings are specific and unequivocal, but also supported by evidence, direct or circumstantial. In Swaran Latha Vs. Union of India19, the Supreme Court held that the Court would be justified in refusing to carry on investigations into allegations of mala fides if necessary particulars of the charge making out prima facie case are not given in the Writ Petition.
In Ajit Kumar Nag Vs. Indian Oil Corporation Ltd.20, the Supreme Court held that there is a presumption in favour of the administration that the power has been exercised bona fide and in good faith.
In Gulam Mustafa Vs. State of Maharashtra21, the Supreme Court held that the allegations of mala fides are the last refuge of a losing litigant. In State of Madhya Pradesh Vs. Nandlal Jaiswal22, the Apex Court held that wherever allegations of mala fides are made, it is necessary to give full particulars of such allegations and to set out material facts specifying the particular person against whom such allegations are made so that he may have an opportunity to controvert such allegations.
In Jasbir Singh Chhabra and others Vs. State of Punjab and others23, the Supreme Court held that the superior courts should not readily accept the charge of malus animus against the State and its functionaries; that the burden to prove the charge of malafides is always on the person who moves the court for invalidation of the action of the State and/or its agencies and instrumentalities; and that in such cases wisdom would demand that the court should insist upon furnishing of some tangible proof in support of his/her allegations.
In Ratnagiri Gas Power Project Ltd. (17-supra), the unsuccessful bidder who was not found to be techno-commercially qualified, made allegations of mala fides against the bid finalizing body. The Supreme Court has undertaken a comprehensive review of the case law on the aspect of mala fides. While reiterating the legal principles referred to above, the Supreme Court held that as and when allegations of mala fides are made, the persons against whom the same are levelled need to be impleaded as parties to the proceedings to enable them to answer the charge; that in the absence of impleadment of the person concerned as a party in his/her individual capacity, it will neither be fair nor proper to record a finding that malice in fact had vitiated the action taken by the authority concerned. It was further held that a judicial pronouncement declaring an action to be malafide is a serious indictment of the person concerned that will lead to adverse civil consequences against him and therefore the Courts are to be slow when drawing the conclusion holding the allegations of mala fides to have been proved and that only in cases where based on the material placed before the Court or facts that are admitted leading to inevitable inferences supporting the charge of mala fides that the Courts should record a finding and in the process ensuring that while it does so it also hears the person who is likely to be affected by such a finding.
Examined on the touchstone of the law laid down by the above mentioned judicial precedents, the pleadings of the petitioners fall woefully short of the legal requirement to enable this Court to accept their plea of mala fides. The petitioners neither impleaded any official of respondent No.2-Corporation as an eo nomine party nor specific allegations against any person concerned with the Corporation have been made. The facts, namely, that respondent No.2 has issued the second notification and enabled Stage-I contractors to participate in the tender process, disqualified the petitioners and qualified respondent Nos.4 to 8, have driven the petitioners to allege mala fides against the Corporation. In my opinion, these facts by themselves would not prove any malice on the part of the officials of respondent No.2-Corporation. The burden lies heavily on the petitioners not only to plead with specificity but also establish the same by direct or indirect evidence that any of the officials of respondent No.2- Corporation have nexus with respondent Nos.4 to 8 and that with a view to help them, respondent No.2-Corporation has withdrawn the first notification and issued the second one. Mere suspicion will never take the place of proof. Indeed, respondent No.2 has specifically pleaded that only respondent Nos.7 and 8 are the Stage-I contractors and respondent Nos.4 to 6 have nothing to do with Stage-I contracts. What passes this Court's comprehension is that if respondent No.2 had really intended to help the private respondents, there would have been no reason to disqualify the Stage-I contractors in the first notification. Respondent No.2 could as well not have imposed any prohibition against them in the first notification itself. It is therefore not only illogical but also unrealistic to think that the bar on Stage-I contractors was lifted with a view to help the latter. After all, as held by a catena of Judgments of the Apex Court, the State and its functionaries must be conceded with freedom to evolve their own terms and even to modify them so long as their action is not for collateral purposes or vitiated by mala fides; and that judicial review by the Constitutional Courts is limited only to the decision making process and to examine whether such process undertaken is reasonable, rational, not arbitrary or mala fide. (See: Sterling Computers Ltd. Vs. M & N Publications24, Tata Cellular Vs. Union of India25, Raunaq International Ltd. Vs. I.V.R. Construction Ltd.26, AIR India Limited Vs. Cochin International Airport Ltd.27, Association of Registration Plates Vs. Union of India28, B.S.N. Joshi & Sons. Ltd. Vs. Nair Coal Services Ltd.29 and Jagadish Mandal Vs. State of Orissa30).
On the above discussed facts and circumstances of the case, this Court has no hesitation to reject the plea of the petitioners that the action of respondent No.2-Corporation is either arbitrary or vitiated by mala fides. As the petitioners failed to establish any circumstances from which this Court can draw a reasonable inference that respondent No.2 has acted arbitrarily or mala fide, it has no reason to believe that removing the ban on Stage-I contractors was with a view to favour any of the private respondents. On the contrary, it is reasonable to presume that respondent No.2 has withdrawn the first notification and issued the second one for ensuring timely transportation of Palmolien oil by involving more and more number of transport contractors.
Before ending the discussion on this Point, it needs to be noted that the learned Senior Counsel has devoted substantial time arguing on the aspect of the alleged disqualification of respondent No.8. He has drawn the attention of this Court to the profile submitted by respondent No.8 wherein it has claimed that it has experience as a transport contractor with agencies such as respondent No.2, M/s.Hyderabad Industries Ltd., KRIBHCO & Madras Fertilizers Pvt. Ltd. and M/s. Gemini Edible Oils and Fats Ltd., among other industries. The learned Senior Counsel submitted that under Clause 2.2 of the NIT, Oil Millers/Oil Millers Association/Oil Mill Lorry Owners Associations or their Associates are prohibited from participating in the tenders. In its profile, respondent No.8 has never claimed that it is an associate of M/s. Gemini Edible Oils and Fats Ltd. It has only claimed that it is an existing transport contractor to the said Company as it is to various other Companies referred to above. Therefore, this submission of the learned Senior Counsel can be referred, only to be rejected. The learned Senior Counsel also laid emphasis on Clause 2.5 of the NIT under which persons or firms blacklisted/Oil Millers/Oil Millers Association/Oil Wholesale or Retail Dealers/Stage-II Contractors/Fair Price Shop Dealers and their representatives or persons or associates, are not eligible to participate in the tenders. He submitted that by order dated 26- 3-2011, M/s. Lucky Trading Company, a proprietory concern owned by the son of the proprietor of respondent No.8, was blacklisted by respondent No.2. Respondent No.8 has denied any nexus with M/s. Lucky Trading Company. Sri N. Siva Reddy, learned counsel for respondent No.8 submitted that his client is not an associate of M/s. Lucky Trading Company and that the mere fact that the proprietors of these two business entities are the father and son would not make respondent No.8 an associate of M/s. Lucky Trading Company. It is unnecessary for this Court to labour on this aspect for the reason that respondent No.2 has produced proceedings dated 19-9-2011 wherein it has cancelled order dated 26-3- 2011 blacklisting M/s. Lucky Trading Company. While not disputing the existence of this proceeding, the learned Senior Counsel, however, is critical of the reasons for which respondent No.2 has cancelled the said blacklisting order. As the validity or otherwise of order dated 19-9-2011 is not the subject matter of this Writ Petition, it is unnecessary for this Court to delve into the said aspect. At any rate, respondent No.8 was never blacklisted and no material is produced by the petitioners to show that the said respondent is an associate of M/s. Lucky Trading Company. On the analysis as above, I see no merit in the submission of the learned Senior Counsel that respondent No.8 is not qualified for being considered for award of contract.
Even though the learned Senior Counsel has prepared a Table showing disqualifications of respondent Nos.4, 7 and 8 on various counts, he has fairly submitted the same are very minor in nature and that the petitioners are not interested in pressing the same.
With regard to the various Judgments cited by the learned Senior Counsel referred to supra, there can be no quarrel on the proposition of law laid down in the said decisions to the effect that the Government or its agencies cannot act arbitrarily like private individuals while awarding contracts and that their actions shall be tested on the anvil of Article 14 of the Constitution of India. However, on the facts of this case, these Judgments would not help the petitioners as they failed to bring home the allegation that the action of respondent No.2 is vitiated by arbitrariness and mala fides. Re Point No.3: Having regard to the findings rendered on Point No.2, it is unnecessary for this Court to deal with and pronounce upon the issue relating to waiver. Even though the finding on this aspect either way does not change the result of the case, I am in agreement with the submission of the learned Senior Counsel that there can be no waiver of the Constitutional rights as held in Basheshar Nath (7-supra), Kesavananda Bharati (8-supra) and Shree Mahavir Oil Mills (9-supra).
In Md. Abdul Azeez Asad (10-supra), a Full Bench of this Court repelled the contention of the State Government and the Health University that the petitioners having appeared for the common entrance test and counselling are estopped from challenging the seat matrix and the rules of admission. Relying upon the Judgments in Basheshar Nath (7-supra), Om Prakash Shukla Vs. Akhilesh Kumar Shukla31, Union of India Vs. N. Chandrasekharan32 and Swaran Latha (19- supra), the Full Bench rejected the contention based on waiver.
In the instant case, the main ground of attack of the petitioners is that in withdrawing the first notification and issuing the second notification by lifting the ban on Stage-I contractors, respondent No.2-Corporation has acted arbitrarily and thereby violated Article 14 of the Constitution of India, the enforcement of which is one of the fundamental rights of every citizen. Irrespective of whether the petitioners succeeded in proving their plea in this regard, they cannot be non-suited on the ground of waiver having regard to the settled legal position referred to above. This Point is accordingly answered.
For the above mentioned reasons, the Writ Petition is partly allowed to the extent of declaring the disqualification of the tenders of the petitioners by respondent No.2 as illegal. A writ of mandamus shall accordingly issue to respondent No.2 to qualify the petitioners' tenders and evaluate the same along with other tenders for award of contract. The Writ Petition, in all other respects, is dismissed.
As a sequel, WPMP No.12903/2013, WVMP Nos.1286/2013 and 1401/2013 are disposed of as infructuous.
________________________ Justice C.V. Nagarjuna Reddy Date : 5-7-2013