BLUE STAR LTD Vs. STATE OF ORISSA

JUDGEMENT

(1.) THE Director of Medical Education and Training, Orissa, Bhubaneswar published a tender call notice in different newspapers inviting tenders in sealed cover from the reputed manufacturing firms and/or authorized distributors for supply of instrument and equipment items for eight Regional Diagnostic Centres. In response to the said tender call notice, the petitioner and opposite party No. 3 amongst others submitted their bids for C.T. scan machines. Clause 3.16 of the terms and conditions for acceptance of the tender for supply of instrument and equipment items to the Government provided that the tenderers have to furnish price bid and technical bid in two sealed covers and the cover containing technical bid would be opened first for evaluation and the cover containing price bid of the tenderers who have pre -qualified will be opened thereafter. The covers containing technical bids of the petitioner, opposite party No. 3 and other tenderers for C.T. scan machines were opened first on 15.10.2003. In the technical evaluation of the bids of different tenderers made on 15.12.2003 by a technical sub -committee comprising of the Professors and Heads of Department of Radio Diagnostics of the three Medical Colleges of the State of Orissa, Deputy Director, Instrument and Equipment, D.G.M., OCAC, the technical bids of three bidders including that of the petitioner and the opposite party No. 3 for C.T. scan machines were found to have complied with the tender specifications and the technical bids of five bidders for C.T. scan machines were found not to have complied with the tender specifications. The technical sub -committee, however, considered the C.T. scan machine (model : Somaton E -motion) proposed to be supplied by the opposite party No. 3 as technically superior to C.T. scan machine (model : Hitachi Pronto SE) proposed to be supplied by the petitioner, and graded the two models to be supplied by the opposite party No. 3 and the petitioner as T -1 and T -2 respectively. The petitioner has stated in the petition that when the price bids were opened on 30.12.2003, the price bids of the petitioner and the opposite party No. 3 were found to be as in Annexure -3 to the writ petition. Relevant extracts from Annexure -3 to the writ petition are given hereunder:

(2.) THE case of the petitioner in the writ petition is that the price bid of the petitioner for C.T. scan machine (model : Hitachi Pronto SE) proposed to be supplied by the petitioner without the optional items and without CMC (Comprehensive Maintenance Charge) was the lowest and therefore the petitioner should have been called by the authorities to negotiate the CMC but instead, the authorities treated the price bid of the opposite party No. 3 inclusive of the CMC as the lowest and called the opposite party No. 3 for negotiation so as to reduce the price of the C.T. scan machine (model : Somaton E -motion) proposed to be supplied by the opposite party No. 3 to the lowest price of the petitioner and thereafter issued the purchase order for six C.T. scan machines on the opposite party No. 3 at the unit price quoted by the petitioner in Annexure -6 to the writ petition. The petitioner has prayed for quashing the said purchase order issued in favour of the opposite party No. 3 in Annexure -6 to the writ petition and for directing the opposite parties 1 and 2 to award the tender for supply of C.T. scan machines to the petitioner as the petitioner was the lowest tenderer for the said machines.

(3.) MR . Rath cited the decision of the Supreme Court in Ram and Shyam Company v. State of Haryana and Ors., AIR 1985 SC 1147, in which the Supreme Court has deprecated the action of the Government in not giving any opportunity to the party whose bid was the highest to negotiate with the Government in respect of grant of a quarry lease. He also cited the decision of the Supreme Court in Sterling Computers Limited v. M and N. Publications Ltd. and Ors., AIR 1996 SC 51, for the proposition that while awarding contracts in respect of properties belonging to the State, the action or procedure adopted by the authorities is to be judged and tested in the light of Article 14 of the Constitution. He also cited the decision of the Supreme Court in Unique Construction Corporation v. City and Industrial Development Corporation of Maharashtra Ltd., (1996) 7 SCC 66, wherein it has been held that five tenderers who were found eligible should have been given opportunity to make revised offers in sealed covers. Finally, Mr. Rath cited the decision of the Supreme Court Ramana Dayaram Shetty v. The International Airport Authority of India and Ors., AIR 1979 SC 1628, and Dutta Associates Pvt. Ltd. v. Indo Merchantiles Pvt. Ltd. and Ors., (1997) 1 SCC 53, and submitted that the terms and conditions for acceptance of tender for supply of instrument and equipment items to Government have to be strictly followed by the authorities so that the tender process is transparent, fair and not arbitrary. He submitted that the said decision of the Supreme Court in Dutta Associates Pvt. Ltd. v. Indo Merchantiles Pvt. Ltd. and Ors. (supra) was relied on by a Division Bench of this Court in Balangir Trading Co. v. Bharat Sanchar Nigam Limited and Ors., 2003 (Supp.) OLR 626, for setting aside the tender process for appointment of a distributor of B.S.N.L. mobile service for the Balangir -Bhawanipatna territory.