ARUNDHUTI CABLES AGARTALA Vs. STATE OF TRIPURA

JUDGEMENT

(1.) In this application under Article 226 of the Constitution of India, the petitioner has prayed for a direction on the respondents 1 and 2 to declare the tender of the respondent No. 3 as informal and to reject the same forthwith, and to direct the respondents 1 and 2 to issue supply order in favour of the petitioner-firm at the rate quoted by the petitioner-firm in respect of items for which Notice Inviting Tender No. 03/2000-01 was issued by the respondent No. 2.

(2.) The case of the petitioner is that it is a Small Scale Industrial Unit (for short, "SSI unit") located in the State of Tripura. By a notification dated 10 8.2000, the Government of Tripura in the Industries & Commerce Deptt., laid down a policy administering/ allowing 15% price preference to local SSI Units as per Tripura Incentive Scheme, 1995, while making Government purchase programme. The petitioner-firm being an SSI Unit located in Tripura is entitled to the said 15% price preference as per Tripura Incentive Scheme, 1995 in all purchases made by the Government. A notice inviting tender No. 03/ 2000-01 was issued by the Executive Engineer, Electrical Stores Division, respondent No. 2 inviting tenders for supply of 4 mm2 and 2.5 mm2 PVC cable. The petitioner-firm which manufacturers such PVC cable in the State of Tripura, submitted its tender. The respondent No. 3 which also manufactures such PVC cable in the State of West Bengal also .submitted its tender. The Tenders were processed at different stages and were finally considered by the Supply Advisory Board, (for short "SAB"), and by Memorandum dated 22.7.2000, the SAB recommended that the entire quantity of 1000 km of 4 mm2PVC cable be supplied by the respondent No. 3 at the rate of Rs. 3842.48 per km. and that 250 km of 2.5 mm2 PVC cable be also supplied by the said respondent No. 3 at the rate of Rs. 2731.76 per km. and 750 km of 2.5 mm2 PVC cable be supplied by the petitioner at the rate of Rs. 313 0.00 per km. Apprehending that the orders for supply of PVC cable will be placed on the respondent No. 3 on the basis of the said recommendations of the SAB, the petitioner has moved this court in the present writ petition under Article 226 of the Constitution for appropriate reliefs.

(3.) Mr. S. Talapatra, learned counsel appearing for the petitioner, submitted that the tenderers were required to quote/mention the excise duty payable in their tenders. The petitioner being an SSI Unit was entitled to some exemption from excise duty and did not mention the same in the tender papers, but the respondent No. 3 though liable to pay excise duty did not mention the excise duty payable in the tender papers. But when the authorities considered the tenders submitted by the petitioner firm and the respondent No. 3 excise;duty @ 16% was initially loaded on the rate quoted by the respondent No. 2 on presumptive basis by the Executive Engineer, but thereafter the said rate was reduced to 9.6% by the Additional Chief Engineer, According to Mr. Talapatra, this procedure adopted by the authorities to determine the excise duty payable by the respondent No. 3 when the; respondent No. 3 had not mentioned the same in its tender papers was arbitrary, unreasonable and unfair. According to Mr. Talapatra, the tender submitted by the respondent No. 3 should have been out right rejected as it had not quoted the excise duty payable in its tender papers. He further submitted that under paragraph 2(vi) of the notification dated 10th August, 2000 of the Government of Tripura, Department of Industries & Commerce, if the capacity of the lowest quoting local SSI Unit to supply adequate quantities of tendered item within time frame of supply is doubtful, 25% of the total quantity of the item concerned can be purchased from outside firms and not otherwise. The rate quoted by the petitioner- firm for 2.5 mm2of PVC cable was the lowest after applying 15% price preference: and the petitioner-firm had the capacity of supplying the entire 1000 km of PVC cable during the time-frame stipulated in the notice inviting tender. Hence, the SAB should have recommended for supply of the entire 1000 km. of PVC 2.5 mm2 PVC cable: by the petitioner. But instead, the SAB recommended that 750 km of such 2.5mm2PVC cable be supplied by the petitioner-firm ;and the remaining 250 km of 2.5 mm2PVCisable be supplied by the respondent Nd. 3 Mr. Talapatra cited the decision of the Supreme Court in Air India Ltd. V. Cochin International Airport Ltd, (2000;( 2 SCC 617, for the proposition that the court can examine the decision making process in a case relating to award of contract and interfere if it is found vitiated by malafide, unreasonableness and arbitrariness. According to Mr. Talapatra, since the decision-making process in the present case in awarding the contract for supply of PVC cable to the respondent No, 3 is vitiated by malafide, unreasonableness and arbitrariness, this is a fit case in which the court should interfere with the recommendations of the SAB under Article 226 of the Constitution of India.