T M ABRAHAM Vs. STATE OF KERALA

JUDGEMENT

(1.) This original petition filed by the 1st petitioner is to quash the proceedings of respondents 1 and 2 the State of Kerala and the Superintending Engineer, Public Health Circle, Cochin, awarding a contract to the 3rd respondent for the work referred to as "the Industrial Water Supply Scheme to Ambalamugal Construction of Overhead Water Tank and Treatment Plant and Allied Works at Choondy", and also to issue a writ of mandamus directing the 1st and 2nd respondents to award the contract to the 1st petitioner or in the alternative to issue a direction to make a proper choice of the person for the award of the contract in the interest of the State and in public interest. The 2nd petitioner got himself impleaded later as per orders of this Court dated 30-8-1983 in C. M. P. No. 22232 of 1983.

(2.) Both the petitioners are Contractors registered as A class with the Public Health Engineering Department of the. Government of Kerala. For the construction of an overhead water tank, treatment plant and allied works in connection with the industrial water supply scheme to Ambalamugal, the 2nd respondent, the Superintending Engineer, Public Health Circle, Cochin, invited tenders from registered A class Contractors as per notification published in the Veekshanam dated 15-5-1983 and the Mathrubhumi and Indian Express dated 19-5-1983. Tender was to be submitted in proper form accompanied by an earnest money deposit of Rs. 23,000/- to reach the 2nd respondent on or before 6-7-1983. Tenders received were opened at 4.30 p. m. on 6-7-1983 in the presence of the tenderers and their agents, and it was found that the 8 tenders received varied in the rates quoted between 28.9% and 200% above the average estimated rates. Two of the tenders were invalid for want of earnest money deposit The 1st petitioner had quoted 87% above the estimated average rates and the 2nd petitioner had quoted 64% above average. The tenders submitted by the petitioners were accompanied by covering letters with special conditions for carrying out the work. Both the petitioners were asked to produce proof of experience and they were also required to state whether they were prepared to relax the special conditions. Ext. P-2 dated 18-7-1983 is a letter by the 1st petitioner addressed to the 2nd respondent as per which he withdrew the special conditions suggested. Ext. A. P-2 dated 18-7-1983 is a similar letter by the 2nd petitioner withdrawing the special conditions. The 2nd respondent entered into negotiations with the petitioners and others and the petitioners were asked to furnish further details regarding their experience and qualification to carry out the work in connection with the construction of the overhead tank and allied work for the water supply scheme. The 1st petitioner on 19-7-1983 as per Ext. P-3, gave a letter giving details of his experience and offering to reduce the rate to 58% above the average estimated rates. The 2nd petitioner also as per Ext. AP-3 gave further details relating to his qualification and experience to carry out the work. Along with Ext. AP-3 the 2nd petitioner produced some documents to show that he was a partner of M/s. Varghese K. Pulayath and Company who are also contractors registered as A Class with the P. H. E. D. The 3rd respondent who had not submitted any tender in pursuance to the tender notifications issued by the 2nd respondent gave a quotation on 19-7-1983 to carry out the work at 67.5% above the estimated average rates. The 2nd respondent later by Ext. R-3 (a) letter dated 21-7-1983 requested the 3rd respondent to reduce the rates and indicated that his partner Sri. Abu Mathew had quoted 63.5% above the estimated average rates. The 3rd respondent as per Ext. R-3 (b) letter of the same date gave a revised offer reducing the rate to 63.5% above the average estimated rates mentioned in the tender notification. The petitioners submit that the contract to carry out the work is settled between the 1st and 3rd respondents at the rate quoted as per Ext. R-3 (b). The action of respondents 1 and 2 in giving the contract to the 3rd respondent is opposed to Article 14 of the Constitution. The choice of the 3rd respondent is arbitrary and the petitioners had no opportunity to compete with the 3rd respondent giving a reduced rate for the work to be carried out in connection with the scheme. The petitioners also allege mala fides on the part of the 2nd respondent in having been instrumental in bringing about the contract between the 1st and the 3rd respondents to carry out the work. Relief is sought for in this original petition on the ground of mala fides as well as on the ground of violation of Article 14 of the Constitution in arbitrarily choosing the 3rd respondent for the contract to carry out the work. All the respondents have filed counter-affidavits denying the allegations contained in the original petition. According to the respondents the work in connection with the water supply scheme was of an emergency character required to be carried out within a very short time. The Government as per G. O. Ms. 87/83/LA & SWD dated 17-1983 marked as Ext. R-2 (a) had constituted an "Empowered Project Implementation Committee" with the Commissioner and Special Secretary, Industries Department as Chairman and the Secretary, Finance-Expenditure, the Superintending Engineer in charge of the project, a representative of the, Cochin Refineries Ltd., and a nominee of the Government of India as members for the purpose of managing the project implementation with utmost speed. Ext. R-2 (a) G. Order refers to the discussion that the Member, Planning Commission and Secretary Department of Petroleum, Government of India, had with the Chief Minister and the Minister for Irrigation on 21-6-1983 relating to the problems connected with the expansion of the Cochin Refineries Ltd., and the decision taken to implement the water supply project, Ambalamugal on an emergency basis and it was for that purpose that the Empowered Project Implementation Committee had been constituted. Of the eight tenders received on 6-7-1983, it was found two were defective and could not be considered for entrustment of the work. On a consideration of the merits of the other tenderers, none of them was found to have the requisite experience for the erection of overhead water tanks and allied works. The matter was reported by the 2nd respondent to the Empowered Committee and the Committee at its meeting held on 8-7-1983 directed the 2nd respondent to contact parties having experience in this particular line of construction and obtain quotations from them.

(3.) The learned Additional Advocate General, appearing on behalf of respondents 1 and 2 placed before me the files relating to the proceedings of the Empowered Committee at its meeting held on 8-7-1983. The meeting was attended to by the Commissioner, and Secretary, Industries Department, Secretary, Finance-Expenditure, a nominee of the Cochin Refineries Ltd., a nominee of the Government of India and the 2nd respondent. The Executive Engineer, P. H. E. D. was present on special invitation. The Deputy Secretary, Department of Petroleum and the Managing Director of the Cochin Refineries Ltd., also attended the meeting. Ext. R-2 (b) is an extract of the proceedings of the meeting of the Empowered Committee held on 8-7-1983. Ext. R-2 (b) shows that the Superintending Engineer informed the Committee about the tenders received and on a preliminery examination it was found that none among the tenderers had experience in constructing overhead tanks. The Committee decided that as time was of utmost importance the contract should be awarded only to a reliable person having adequate experience in similar construction work. Accordingly, the Superintending Engineer, was directed to contact parties and obtain quotations if it is found that none among the tenderers had previous experience in the construction of overhead tanks. The Superintending Engineer was required to place his recommendation before the Committee at its next meeting fixed to be held on 23-7-1983. It was on the basis of this decision of the Empowered Committee that the 2nd respondent asked for further details of experience and qualifications of the petitioners and other tenderers and also negotiated with the 3rd respondent Sri. Varghese K. Pulayath and other contractors of repute. It was in this connection that the 2nd respondent obtained further clarification relating to the qualifications and experience of the petitioners and other tenderers. He had also on 19-7-1983 received a quotation from the 3rd respondent. Sri. Varghese K. Pulayath had given a letter to the 2nd respondent stating that in case the contract is settled in favour of the 2nd petitioner he is prepared to take him as a partner of the firm Varghese Pulayath & Company. The further clarifications received from the tenderers and the quotation received from the 3rd respondent were placed before the meeting of the Empowered Committee held on 23-7-1983. This meeting was attended to by the Secretary Industries Department, the Secretary Finance-Expenditure a nominee of the Cochin Refineries Ltd., the Deputy Secretary Department of Petroleum as the nominee of the Government of India, the Chief Engineer, Public Health Engineering Department, the 2nd respondent and the Special Secretary, Local Administration and Social Welfare Department Sri. P. C. George of Engineers India Ltd., who was at the first meeting the nominee of the Government of India was also present on special invitation. Ext. R-2 (c) is a copy of the proceedings of the meeting of the Committee held on 23-7-1983. Ext. R-2 (c) shows the following facts, were considered at the meeting. Of the persons who had submitted tenders, it was seen that none of them had experience in the particular line of work required, to be executed. The 2nd respondent had asked the tenderers to give in writing the details of their experience in similar work and details of tools and plant shuttering and staging materials available with them. They were also given a chance to reduce the quoted rates. The 2nd respondent in pursuance to the authorisation given to him as per Ext. R-2 (b) had contacted three other contractors including the 3rd respondent and Varghese K. Pulayath who had experience in the construction involving overhead tanks and had requested them to submit quotations in sealed covers before 19-7-1983. The six tenderers were also contacted and revised quotations were received from four of them including the petitioners. Ext. R-2 (c) shows that the Committee decided that no party without previous experience in the construction of overhead tanks and without having ready access to shuttering and other materials need be considered for awarding the contract. Since none of the tenderers had previous experience in the construction of overhead tanks, the Committee decided that the tenders received cannot be accepted. The petitioners were thus eliminated for the reason of lack of experience in construction work in connection with overhead tanks. Paragraph 4 of Ext. R-2 (c) shows that among the five contractors contacted by the 2nd respondent Sri. Varghese K. Pulayath and the 3rd respondent submitted quotations before the specified time on 19-7-1983. Sri, Varghese K. Pulayath quoted 64% and the 3rd respondent originally quoted 67.5% above the estimated rates. The 3rd respondent had subsequently submitted his willingness to reduce the rates to 63.5% above the estimated average rates. These two persons were also required to furnish details of other work done as well as the availability of materials with them for undertaking the work. From the information furnished by Sri. Varghese K. Pulayath it was seen that the works undertaken by him earlier were comparatively small except for three items of work costing between rupees twenty three lakhs and Rs. twenty lakhs. It was also reported that he is presently engaged in the construction of an overhead tank at Trichur and all the shuttering and other materials at his disposal are required for the work at Trichur. The 3rd respondent was found to have wider and longer experience and had successfully undertaken the construction work of overhead tanks and treatment plants for the Public Health Engineering Department for its Thiruvalla Water Supply Scheme. In view of the urgency of the situation and the need to entrust the work to a contractor having sufficient experience and capacity to ensure timely completion of the work the committee decided that the contract should be awarded to the 3rd respondent, who had also agreed to reduce the rate to 63.5% above the estimated average rates. The Superintending Engineer was directed to contact the 3rd respondent again and ascertain the possibility of a further reduction in rates and report to the Committee at its meeting to be held on 28-7-1983. That meeting was attended to by the Commissioner and Special Secretary, Industries Department, the Secretary Finance Expenditure, the Chief Engineer, P. H. E. D., the 2nd respondent, the Managing Director of the Cochin Refineries Ltd. and a representative of the Engineers India Ltd., who was formerly the nominee of the Government of India. Ext. R-2 (d) is the extract of the proceedings of the meeting of the empowered committee held on 28-7-1983. Ext. R-2 (d) shows that the Superintending Engineer had informed the Committee that in pursuance to the decision of the Committee at its meeting held on 23-7-1983 he had held discussions with the 3rd respondent regarding reduction of rates, the 3rd respondent was not agreeable for any further reduction and the Committee decided to award the contract to the 3rd respondent at 63.5% above the estimated rates.