DUTTA ASSOCIATES PRIVATE LIMITED Vs. INDO MERCHANTILES PRIVATE LIMITED
LAWS(SC)-1996-11-147
SUPREME COURT OF INDIA
Decided on November 18,1996

Dutta Associates Private Limited Appellant
VERSUS
Indo Merchantiles Private Limited Respondents

JUDGEMENT

- (1.) Leave granted.
(2.) Inexplicable indeed are the ways of the rulers on some occasions - and this is one such instance. The Commissioner of Excise, Assam called for tenders for wholesale supply of rectified spirit (Grade 1 to the Excise Warehouse at Tinsukia for the period 16/5/1994 to 15/5/1996. The tender was floated on 28/5/1993. As many as seventeen tenders mentioned below were received quoting the rate mentioned against each person's name:
(3.) It is stated that out of seventeen tenders received, tenders of persons mentioned at Sr. Nos. 1 and 2 were found ineligible and were, therefore, excluded from consideration. If that were so, one would have expected the Commissioner to accept the offer of the person at Sr. No. 3 (Dutta Associates Pvt. Limited, the appellant herein) , his being the lowest tender. He did not do so. He did not say that the offer of Dutta Associates was not a genuine offer or that he is not in a position to fulfil the terms of the contract, if entered into with him. On the other hand, the Commissioner and the government entered upon an exercise of determining, what they call "viability range". They determined the viability range between Rs. 14.72 to Rs. 15.71 per LPL, It is said that this viability range was arrived at keeping in view the prevailing prices outside the State inasmuch as most of the rectified spirit to be supplied under the contract had to be procured outside the State of Assam. If viability range was the relevant basis, then one would have expected the Commissioner and the government of Assam to have accepted the tender at Sr. No. 11 (Shri Pranab Kumar Rajkhowa) , whose bid was the lowest within the viability range. They did not do this either. They called upon Dutta Associates (appellant herein) to revise his offer which he did by quoting Rs. 15.71 per LPL (which happens to be the maximum of the viability range). His bid was accepted. Whereupon Indo Merchantiles Private Limited (first respondent herein) who is at Sr. No. 13 in the aforesaid list of tenders, filed a writ petition in the Guwahati High court questioning the acceptance of appellant's tender. Indo Merchantiles submitted that not accepting his tender at Rs. 15.55 and accepting the tender of the appellant by making him revise his bid is contrary to law, unfair and arbitrary. The writ petition was dismissed by a learned Single Judge. On appeal, however, the division bench has allowed the writ appeal filed by Indo Merchantiles and has set aside the acceptance of the appellant's tender. The division bench found that the Commissioner and the government have acted unfairly in calling upon the appellant, Dutta Associates, alone to submit a counter-offer while not giving a similar opportunity to other tenderers. The High court accordingly directed that fresh tenders be called for awarding the contract. It has also made certain directions for the period until fresh tenders are called for and finalised.;


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