Decided on April 15,1983

UNION OF INDIA Respondents


Rajindar Sachar, J. - (1.)We had heard the counsel for the petitioners and counsel for the respondents at length. At the end of the arguments we had announced that we were dismissing the petition but as there was no time left the judgment was not dictated in Court. We are now giving the reasons for dismissing the writ petition.
(2.)This petition challenges the decision made by the Standing Committee of the Board of Directors of respondent No. 2 to award the contract for Water Treatment for Captive Plant at Angul to respondent No. 3 at a firm price of Rs. 14.03 crores on turn-key basis.
(3.)The petitioner is a private limited company engaged in the business of erection/installation and commissioning of water treatment plants and allied works. The petitioner is a small scale unit registered with National Small Scale Industries Corporation Limited. Respondent No. 2 is National Aluminium Company Ltd. (NALCO) which is a Government of India Undertaking. Respondent No. 3, M/s. Bharat Process & Mechanical Engineers Ltd. (BPMEL) was formerly known as Bird & Company Ltd. This company was nationalised and was -taken over by the Government of India in the year 1980. Respondent No. 2 is setting up an Aluminium Complex at Talchar with a Captive Power Plant in Orissa at a cost of Rs. 1200 crores. The project is being installed with French Collaboration and supported by French credits. The Water Treatment Plant is for the power plant. Tenders were invited in April, 1982 for the supply of power plant on turn-key basis. The scope of the work includes designing, manufactur testing, erection, commissioning and performance guarantee. The bids received were evaluated by the Consultants, M/s. Development Consultants Pvt. Ltd. (DCPL) who forwarded the bids received from 4 parties including the petitioner and respondent No. 3. Admittedly the tender given by the petitioner was the lowest and that of respondent No. 3 the second lowest. Originally the price quoted by the petitioner was Rs. 13.45 crores while that quoted by the respondent No. 3 was Rs. 14.90 crores. In between there were negotiations by respondent No. 2 with respondent No. 3 and the petitioners. Respondent No. 3 agreed to reduce its bid to Rs. 14.03 crores. It still is admittedly 6/o higher than that of the tender amount given by the petitioner. The Standing Committee of the Board of Directors of respondent No. 2 however, considered this matter finally at its meeting held on 9-3-1983 and after discussion approved the award of contract to respondent No. 3 at a price of Rs. 14.03 crores on turn-key basis. It is this decision to award contract which is challenged by the petitioner in this writ petition. We have heard Mr R.S. Narula and Mr. K.K. Venugopal for the petitioners, Mr. B.N. Lokur, Dr. Y.S. Chitaley and Mr. A.B. Saharya for the respondents.

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