MIC ELECTRONICS LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) Barat Sanchar Nigam Limited (BSNL) invited sealed tenders for supply of (1) WLL CDMA 2000 IX (PACKAGE-I) and (2) WLL CDMA 2000 DC INTEGRATED FWTs (PACKAGE-II) through Notice Inviting Tender No.MM/SW/ 072004/000277 dated 15-7-2004. The petitioner-company claiming to be a small scale industry manufacturing various electronics and telecommunication network systems registered with the National Small Industries Corporation Limited (NSIC) with a monetary limit of 703 lakhs under Ref. No.NSIC/ HYD/GP/17(M-78)/2004/9398 dated 12-5-2004 responded to the Notice Inviting Tender (NIT) and submitted its tender claiming benefit of exemption from payment of bid security up to the amount equal to the monetary limit as certified by NSIC as per Clause 12 of Section-II (Instructions to Bidders) of NTT, which reads as under:

(2.) The second respondent-BSNL filed a detailed counter-affidavit raising a preliminary objection with regard to jurisdiction of this Court to entertain the writ petition stating that neither any of the cause of action had arisen within the jurisdiction of this Court nor any of the respondents is located within the jurisdiction of this Court; the NIT was issued at New Delhi; clarifications were issued at New Delhi, demand draft was deposited in favour of AO (cash) BSNL, at New Delhi, the bids were submitted and were opened at New Delhi, the original bid of the petitioner-company was returned to and received by the representative of the petitioner-company at New Delhi. At no point of time, any cause of action arose within the jurisdiction of this Court; therefore, the writ petition is not maintainable. It is further stated that clause on which the petitioner relying has been incorporated since last more than ten years and a plain reading of Clause 12.1 of Section-n of NIT makes it clear that the maximum limit of exemption is Rs.50 lakhs. Even if NSIC certificate provides no limit, the exemption will be restricted to Rs.50 lakhs. Before starting the process at 12 Noon on 14-10-2004, the procedure to be adopted was announced in the presence of the representatives of the participating bidders. The petitioner was aware of the fact that concession in submission of bid security was available to it only up to a maximum of Rs.50 lakhs and in fact the petitioner has participated earlier in similar tenders floated. Although provision exists for seeking clarification on bid documents (clause 5.1 of Section-II of NIT), the petitioner-company did not seek any clarification on applicability of concession to SSI units registered with NSIC. During the bid opening process on 14-10-2004, provisions of the tenders and NSIC clauses in detail were explained. The representative of the petitioner-company who was present accepted the return of bid and in token thereof put his signature on the relevant document. The petitioner-company has not submitted any representation to the BSNL either during the bid opening or at any stage thereafter till date. The purpose behind the filing of the writ petition is only to delay in finalization of procurement of IFWTs. Since telephone connections based on CDMA technology are very much in demand in India and all the private telecom operators have already gone ahead in installing their equipments and are providing their services, BSNL is only PSU telecom operator providing services throughout India (except Delhi and Mumbai which are served by MTNL) has planned to cover the maximum part of India and to provide telephone services to rural and uncovered areas and floated tenders to procure IFWTs, which are required to be supplied and installed and provide telephone service in the States of -Assam, Bihar, Chattisgarh, Gujarat, Haryana, Himachal Pradesh, Jammu and Kashmir, Jharkhand, Madhya Pradesh, NE-1 and NE-II, Orissa, Punjab, Rajasthan Uttaranchal, Uttar Pradesh (E), Uttar Pradesh (W), West Bengal and Kolkatta. Any delay in finalization of procurement of IFWTs will seriously hamper the targeted development of all the States and will result in serious disadvantage to the ordinary citizens of the country. On return of the petitioner's bid, financial bids of eligible bidders were opened on 14-10-2004 and reached the stage of finality. Since the financial bids are made known to the petitioner, the petitioner's tender cannot be considered at this stage. The sanctity of the tender process will be eroded if the bid of the petitioner is directed to be considered at this stage. The writ petition is not maintainable as successful tenderers have not been impleaded to the writ petition and the same is liable to be dismissed for non-joinder of necessary parties.

(3.) Telecom Equipment Manufacturers Association of India (TEMA), which is officially recognized by the Government of India as the apex body representing equipment manufacturers both in public and private sector, to which petitioner-company is a member, filed WPMP No.26466/2004 along with counter-affidavit, to implead itself in the writ petition, which is allowed today. In its counter-affidavit, it is stated that Clause 12 was incorporated as a result of series of consultations and negotiations held by TEMA with the Government of India, Ministry of Communications and IT, BSNL at various levels spread over for a period of about six months, which resulted in releasing Procurement Manual of BSNL in June, 2003. The said clause, as a matter of fact, is in use for the last 10 years. Clause 12 makes it clear that even if the monetary limit is mentioned as "no limit" in the certificate of NSIC, the exemption from payment of bid security is limited to the maximum of Rs.50 lakhs, which was rightly understood by all the manufacturers who are the members of the TEMA. In fact in the present tender process, one of other Small Scale Industry, namely, M/s. KMR Industries Limited participated with NSCI certificate. Even though certificate issued in its favour mentioning the limit as Rs.397 lakhs, bidding company submitted the bank guarantee for Rs.1.50 crores after availing the exemption of Rs.50 lakhs. At no occasion so far any equipment manufacturer or any Small Scale Industry has raised any doubt on the fact that the maximum exemption limit is only Rs.50 lakhs. The petitioner having realized its folly in making a non-conforming bid accepted the return of bid on 14-10-2004 as withdrawn, no cause of action survives in favour of the petitioner-company at all. At no point of time or even till date, the petitioner-company has neither represented to BSNL nor to the Ministry of Communication nor to TEMA either asking for clarifications or confirmation of the interpretation or redressal of any grievance.