BYFORD PRIVATE LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioner company, Messrs Byford Pvt. Ltd. had submitted a tender in pursuance of a tender notice dated 9-11-1970 issued by the Gujarat State Cooperative Land Development Bank Ltd., Ahmedabad (2nd Respondent) hereafter called the Bank. Quotations were invited by the Bank from those suppliers in the member countries of the International Bank for Reconstruction & Development and Switzerland, who had established tractor manufacturing facilities in India or had obtained "necessary approvals of the Government of India" for manufacture of tractors in India prior to the date of the issue of this notice, for supply of 800 wheel type imported tractors in various quantities in the horse power ranges of above 25 but not exceeding 50, as per specifications given in the tender papers.

(2.) A sum of 35 million U.S. dollars have been received by the Government of India as credit from the International Development Association (hereinafter called the I.D.A.) in various currencies; it was intended that portion of the proceeds of the said credit sould be available for payments under the contracts for which the above said invitation to bid was issued. The said credit was made available in pursunce of a scheme for carrying out the Gujarat Agricultural Credit Project.

(3.) On 3-6-1970 a Development Credit Agreement was entered into between the I.D.A. and the Government of India and, as a corollary, another agreement, called the project agreement, was entered into between the I.D.A., Agricultural Refinance Corporation and the Bank, on the same day. The credit was to be utilised for the Gujarat Agriculture Credit Project, which is a lending programme to finance investments in minor irrigation facilities and equipment and in farm mechanisation. Out of the total of 35 million U.S. dollars, 7 -4 million dollars were earmarked for tractors, spare parts, harvesters etc. 2,200 imported tractors were to be supplied to the farmers in that State through the loans from the Bank, the procedure in this regard having been prescribed by the Development Credit Agreement between the I.D.A. and the Government of India. The Bank was required to obtain quotations for lots of 700-800 tractors by public invitations from those suppliers in the countries which are members of the International bank for Reconstruction and Development (hereafter called the World Bank), and Switzerland, who had established tractor manufacturing facilities in India or had obtained necessary approvals of the Government of India, in the manufacture of tractors in India prior to the date on which quotations were sought by the tender notice dated 9-11-1970. Thereafter the Bank had to advertise the particularsof different models of tractors, along with the prices quoted, of those selected suppliers and the farmers of the State had to make their choices, inorder of preference, of the tractors, which they would be willing to buy from those selected. The Bank had then to aggregate the orders received and forward them to the I.D.A. for its approval before placing orders. Thereafter the Bank would enter into contracts with the selected suppliers at the prices quoted for the number of tractors ordered.