HEMKUND TRANSPORT SERVICE Vs. UNION OF INDIA
LAWS(J&K)-2006-9-4
HIGH COURT OF JAMMU AND KASHMIR
Decided on September 29,2006

Hemkund Transport Service Appellant
VERSUS
UNION OF INDIA (UOI) AND ORS. Respondents

JUDGEMENT

J.P. Singh, J. - (1.) Background facts
(2.) FOOD Corporation of India, Regional Office, Jammu, issued an Emergent Notice under No. Stg.32(3)/JK/Tender/05 -06/1793 dated 29.07.2006 inviting on the spot offers from financially sound parties having sound business competence and fulfilling eligibility requirements as per Model Tender Form (MTF) clauses for appointment of Road Transport Contractor on day -to -day basis, to be opened on 01.08.2006 at 12.00 noon. Complete failure of State Road Transport Corporation to supply required number of trucks to carry food grains to various parts of the State, had necessitated the issuance of this Emergent Notice which, inter alia, provided that since acute scarcity conditions were prevailing in the entire State, the working of the successful Transport Contractor would be monitored for a period of ten (10) days and in the event of short supply of trucks, the work would be carried out at his cost till finalization of regular Tender Enquiry. The Food Corporation of India ( hereinafter FCI for short) issued a Tender Notice inviting Technical Bids and Price Bids for appointment of Regular Transport Contractors for transportation of food grains Ex -Jammu to various centers mentioned in the tender notice under Two Bid System from financially sound parties possessing sound business competence and eligibility. This notice was published on 01.08.2006. One hundred and five (105) tender documents were purchased by different parties. Fifty eight (58) tender documents were received before the date fixed for the purpose. A committee of officers comprising fourth to eighth respondents examined the Technical Bids and prepared comparative statements showing details of documents attached with technical bids for determining the eligibility of tenderers, who had participated in the Tender Enquiry. M/S Hemkund Transport Service, the writ petitioner, offered its bid for two centers i.e. (i) Ex - Jammu to Lethpora; and (ii) Ex -Jammu to Kishtwar, alongwith fifty four lacs (54), as earnest money. The petitioner was not allowed to participate in the price bid because it was found ineligible for the Technical Bid on three counts: (i) The petitioner had not indicated its PERMANENT ACCOUNT NUMBER (PAN, hereinafter for short) in the Technical Bid documents; (ii) The supplementary partnership deed introducing seventh partner in the petitioner firm, was not registered under the Jammu & Kashmir Registration Act; and (iii) The petitioner did not possess the requisite experience and financial status. Projecting its financial status and experience in the transportation of food grains worth more than fifty crores (50), an experience certificate of transportation of food grains till March, 2006, worth more than thirty three crores (33), and Solvency Certificate of thirty crore rupees from a Nationalized Bank had been annexed by the petitioner with the pre -qualification bid documents. The petitioner, constituted by a registered document, stood registered with the Registrar of Firms and introduction of seventh partner had necessitated the execution of a supplementary deed of partnership, which was a notarized document and information as to his introduction in the partnership too stood conveyed to Registrar of Firms, asserts the petitioner. Grounds taken by the Petitioner The petitioner questions the rejection of its Technical Bid in this writ petition on the following grounds: (i) Notice inviting tender and conditions contained in the Technical Bid particularly the experience clause was irrational, unfair and unreasonable, intended to ensure participation and qualification of only one contractor who was carrying on the work on day -to -day basis till finalization of the Tender Enquiry for the Regular contract. The conditions contained in the Technical Bid were bad because these conditions contravened the standard and guidelines issued by the Central Vigilance Commission in this behalf. (ii) The FCI had acted in bad faith so as to ease out the petitioner from the process of qualifying the technical bid on flimsy grounds. The condition of eligibility prescribed by the FCI providing experience of having undertaken a single contract of the value of not less than fifty percent (50%) of the estimated cost of the tendered work was harsh. Rejection of technical bid of the petitioner for not indicating the PAN with the tender document was unwarranted as there was no such requirement in the tender document to supply the PAN. (iii) Introduction of a partner in the existing partnership firm would not take away the status of the petitioner as a registered partnership firm. Internal arrangement of introducing seventh partner in the partnership firm was permissible and no fault could be found with the partnership, as such. Non -registration of the supplementary partnership deed cannot, in law, be treated as an impediment to assess the financial status of the petitioner to qualify the technical bid. Non -registration of the Supplementary Deed of Partnership was even otherwise inconsequential.  (iv) None of the qualifiers of the technical bid i.e. Chowdhary Nagar Singh, Kashmir Road Line, Kashmir Transport Co., Vikas Transport and Dutta Trading and Chowdhary Transport Company, possessed the requisite Rake handling work experience. (v) The process employed by the respondents for considering the eligibility of the petitioner for the Technical Bid was biased, unwarranted and unfair. Respondents stand in their Reply
(3.) THE FCI says in its reply affidavit that a SoS situation had arisen when the J&K State Road Transport Corporation failed to supply the required number of trucks for execution of the transport contract for carrying food grains to the valley and other far flung areas of the State of J&K. The situation, according to the Corporation, had reached a level where it had become absolutely impossible to meet the supply of required food grains to the public. Series of meeting were held at the level of Chief Minister, Minister of Consumer Affairs and Public Distribution, and Minister for Transport. Inputs received by the intelligence bureau too confirmed the shortage of food grains in major areas of the State. The deliberations ultimately resulted in providing yet another weeks time to J&K State Road Transport Corporation to improve the truck supply position to the FCI so that scarcity of food grains was avoided. Providing of this opportunity to the J&K State Road Transport Corporation, the Transport Contractor did not yield any tangible results meeting the required supply of trucks, And the situation further deteriorated. The J&K State Road Transport Corporation ultimately decided to withdraw from the contract. It was because of the emergent situation in the State regarding non -supply of food grains that the emergent notice came to be issued by the FCI.;


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