Judgment:
In the High Court At Calcutta Civil Appellate Jurisdiction In Appeal from an order passed in its Constitutional Writ Jurisdiction Original Side APOT71of 2016 GA753of 2016 GA1881of 2016 WP146of 2016 Triveni Engicons Pvt. Ltd. & Anr. -vs.- RITES Ltd. & Ors. Before : The Hon’ble The Chief Justice Dr. Manjula Chellur & The Hon’ble Justice Arijit Banerjee For the appellants : Mr. Abhrajit Mitra, Sr. Adv. Mr. Kishore Dutta, Sr. Adv. Mr. Chayan Gupta, Adv. Mr. S.S. Banerjee, Adv. For RITES Ltd. : Mr. Jishnu Chowdhury, Adv. For South Eastern : Mr. Tilak Bose, Sr. Adv. Coalfield Ltd. For Jhajharia Nirman Pvt. : Mr. S. N. Mookerji, Sr. Adv. Ltd. Mr. Satadeep Bhattacharya, Adv. Mr. S. K. Kakrania, Adv. Mr. Sanjib Seni, Adv. Mr. Souvik Kundu, Adv. Heard On :
23. 02.2016, 25.02.2016, 01.03.2016, 10.03.2016 15.03.2016 CAV On :
29. 03.2016 Judgment On :
15. 07.2016 Arijit Banerjee, J.:- (1) This is an appeal against the judgment and order dated 19 February, 2016 passed by the learned First Court in W.P. No.146 of 2016 (Triveni Engicons Private Limited and Another vs. RITES Limited and Others). The facts of the case relevant for the present appeal are as follows:- (2) A Memorandum of Understanding (MOU) dated 28 June, 2010 was entered into by and between Coal India Limited (in short ‘CIL’) and RITES Limited (in short ‘RITES’) where under RITES was appointed as the project management consultant of CIL. Subsequently the said MOU was modified and a communication was issued by CIL to all its subsidiaries including South Eastern Coal Field Limited ( in short ‘SECL’) with the instruction that in respect of engineering and project management consultancy and approval of tenders, the subsidiary of CIL would be the final authority. (3) On 17 July, 2015 RITES issued a tender notice on behalf of SECL inviting bids from interested parties in connection with construction of Railway infrastructure for Kusmunda Railway Siding. Estimated cost of the project was approximately Rs. 116.42 crores. By a corrigendum, the total value of the tender was reduced to Rs. 107.05 crores and the last date of submission of bids was extended till 17 August, 2015. (4) Ten bidders participated in the tender process including the appellant No.1. The technical bids submitted by the parties were opened on 17 August, 2015 and six bidders including the appellant No.1 were found to be technically qualified. Jhajharia Nirman being the respondent No.4 above named and three other bidders were found not to be technically qualified. (5) The appellants received a letter dated 9 December, 2015 from RITES to the effect that the financial bids would be opened on 14 December, 2015 in the presence of the successful tenderers at the office of RITES in Kolkata. Subsequently, the appellants received a letter dated 10 December, 2015 intimating that the date of opening of financial bids had been rescheduled on 18 December, 2015. The appellants received yet another notice dated 16 December, 2015 intimating that the date of opening of financial bids had been further postponed till further advice. (6) Since the appellants did not hear from RITES, by their Advocate’s letter dated 1 February, 2016, the appellants demanded justice from RITES and requested RITES that the financial bids be opened. The appellants contend that thereafter they came to learn that RITES was acting in collusion with the technically disqualified bidders and that was one of the reasons for not opening the financial bids. (7) In those circumstances, the appellants approached this Court by filing W.P. No.146 of 2016 praying for inter alia the following reliefs: “(a) A writ of or in the nature of Mandamus do issue directing the respondent Nos. 1 and 2 to forthwith complete the tender process bearing No.34/OT/SECL-KUSMUNDA/civil & P. way/PKG-II/2015, dated 17th July, 2015 and open the financial bids of the technically qualified bidders as mentioned in paragraph 10 hereof and issue work order to the lowest tenderer; (b) A writ of or in the nature of Prohibition do issue restraining the respondent Nos. 1 and 2 from permitting any person apart from the technically qualified bidders as mentioned in paragraphs 10 hereof from participating in tender process being No.34/OT/SECL- KUSMUNDA/civil & P. Way/PKG-II/2015, Dated 17TH July, 2015;”. (8) SECL and the respondent Nos. 4 and 5 above named whose bids were initially found to be technically disqualified, were not parties to the writ petition. However, as per the direction of the learned Judge, they were added as parties. By the impugned judgment and order the said writ petition was disposed of. (9) The learned Judge recorded that upon consideration of the bids of the respondent Nos. 4 and 5 being Jhajharia Nirman Limited (in short Jhajharia) and Track & Tower Infratech (P) Limited (in short T&T), SECL found the same to be technically qualified and informed RITES accordingly by a communication dated 30 January, 2016, with a request to open their financial bids. The learned Counsel for the writ petitioners/appellants contended before the learned Judge that Jhajharia and T&T could not have been declared to be technically qualified and that the learned Judge should direct RITES to proceed with the tender process without opening the financial bids of Jhajharia and T&T. The learned Judge held that it would not be proper to give any such direction in view of the limited scope of relief claimed in the writ petition. The operative portion of the impugned judgment and order is as follows:- “The decision of South Eastern Coal Fields Limited declaring Track & Tower Infratech (P) Ltd. and Jhajharia Nirman Limited as qualified is not under challenge. The only direction that ought to be made and is made is that RITES shall be entitled to consider the financial bids of all the 8(eight) bidders who have been found to be qualified either at the instance of RITES or at the instance of South Eastern Coalfields Limited. If at all the petitioners are aggrieved by the decision of South Eastern Coalfields Ltd. to declare Track & Tower Infratech (P) Ltd. and Jhajharia Nirman Limited as technically qualified, they shall be at liberty to challenge such decision in accordance with law before the appropriate forum, if so advised.”
. CONTENTION OF APPELLANTS :- (10) Appearing on behalf of the appellants Mr. Mitra, learned Senior Counsel submitted that only one point arises for consideration in the present appeal i.e., whether or not Jhajharia met the requirements of Clause 2(a) of NIT under the heading “Qualifying Criteria Works Contracts”.. Clause 2(a) of the NIT pertaining to work experience and in so far as relevant for the present purpose is reproduced hereunder:- “(ii) For works in difficult areas (North East States, J&K, Jharkhand, Chattisgarh and Andaman & Nicbar Island) The Bidders should have satisfactorily completed in his own name or proportionate share as a member of a Joint Venture, at least one similar work of minimum value of Rs. 46.57 crore OR at least two similar works each of minimum value of Rs. 29.10 crore during the last 5(five) years prior to the last stipulated date for submission of the Bid Works completed prior to the cutoff date shall not be considered.”
. (11) Note No.5 under the aforesaid Clause stipulates that “Credential Certificates issued by Government Organizations/Semi Government Organizations of Central or State Government; or by Public Sector Undertakings/Autonomous Bodies of Central or State Government; or by Public Limited Companies listed in Stock Exchange in India or Abroad shall only be accepted for assessing the eligibility of a Tenderer.”
. (Emphasis added is ours). (12) Learned Counsel submitted that Jhajharia submitted Credential Certificate of a Company which is not listed in the Stock Exchange but which is the subsidiary of a Company which is listed in the Stock Exchange. This does not satisfy the aforesaid Note under Clause 2(a) referred to above. He submitted that RITES has found this Credential Certificate/criterion to be a “pre-qualifying”./“eligibility condition”. as would appear from minutes of the meetings of the Tendering Committee held on 23 September, 2013 and 24 September, 2015. This is also the finding of the Tender Evaluation Committee constituted by SECL as would appear from its recommendation dated 29 January, 2016. Mr. Mitra submitted that it is not the case of either RITES or SECL that the Credential Certificate Clause, even though a part of the qualifying criteria is of a general nature, distinct from a pre-qualification criterion. Had it been of a general nature, provision of the same could have been deviated from. Mr. Mitra then referred to Clause 6(b) of the NIT which provides that if the bidder is a wholly owned subsidiary of a Company, the experience and resources of the owner/parent Company or its other subsidiaries will not be taken into account. However, if the bidder is a Company, the experience and resources of its subsidiaries will be taken into consideration. Thus, According to Mr. Mitra, the holding Company and the subsidiary Company are to be treated as separate entities save and except only where the holding Company itself is a bidder. (13) Learned Counsel then submitted that Clauses 6.4, 7.1, 7.2 read with Clause 5.1 of the NIT required any modification of the tender terms to be uploaded on website by publishing addendum/ corrigendum. This procedure has not been followed in the instance case. Relaxation of the qualifying criterion i.e., Clause 2(a), if known to all concerned, would have ensured maximum participation and best price. Mr. Mitra then submitted that there is a mala fide nexus between SECL and Jhajharia which is borne out by the fact that the internal document of SECL being legal opinion dated 28 September, 2015 was available to Jhajharia who annexed the said opinion to its writ petition filed in the Chattisgarh High Court. He submitted that it is significant that this legal opinion has been relied upon by SECL’s Tender Evaluation Committee in its recommendation dated 29 January, 2016. Mr. Mitra submitted that the appellant Company has been adversely affected by the waiver of qualification criterion regarding Credential Certificate of a listed Company. He submitted that the subject tender is a very large one where all the bids are over Rs. 100 crores. There were only six qualified tenderers with the required eligibility criteria as prescribed that include the mandatory eligibility criterion regarding Credential Certificate. The appellant Company in a commercial venture structured its financial bid accordingly. Had the tender terms not included the above eligibility criterion, the tender would have been open to many other bidders. The appellant Company is a veteran in this trade. It was aware of the implication of including/ not including any one or more eligibility criteria. If the Credential Certificate Clause was not there in the tender terms, the appellant Company would have structured its financial bid in such a way as to make its financial bid more competitive in the perspective of a wider participation from a much larger strata of bidders, may be by eliminating the profit element or even by taking a small loss. Jhajharia knew fully well that it was not eligible and only those bidders who met the qualification criteria stipulated in NIT would participate in the tender. However, Jhajharia is obviously the favoured tenderer having access to all internal records of SECL. It was the only ineligible tenderer which had an unfair advantage and it knew that it would get the qualification by waiver of the mandatory qualification criteria. Had Jhajharia participated in the tender without the qualification criteria in the modified form then and in that case, there would have been others similarly placed as Jhajharia who would have participated. This would have changed the entire character of the tender with much more competitive bidding. It is an old and well settled principle of law that the rules of the game cannot be altered after the game has started. SECL and RITES in connivance with Jhajharia has flouted these principles of law relaxing the eligibility criteria after the intending parties submitted their bids. The Courts would not countenance such action. In this connection Mr. Mitra relied on a decision of the Hon’ble Supreme Court in the case of Sorath Builders Vs. Shreejikrupa Buildcon Limited & Another reported in (2009)11 SCC9 Learned Counsel relied on paragraphs 25 and 26 of the said judgment which are set out hereunder:-
“25. The prime consideration on which the High Court set aside the award of contract in favour of the appellant is that if the bid of Respondent 1 was considered in the tender process there would have been saving of public money. However, that would not in any manner justify in going through once again the same tender process, which is always time consuming. Any delay in awarding the contract would only mean increase in the cost of expenditure for cost of construction would go up with the passage of time.
26. In W.B. SEB v. Patel Engg. Co. Ltd. this Court while considering the issue with regard to the process of tender held: (SCC p. 467, para
24) 24…… where bidders who fulfill pre-qualification alone are invited to bid, adherence to the instructions cannot be given a go-by by branding it as a pedantic approach, otherwise it will encourage and provide scope for discrimination , arbitrariness and favouritism which are totally opposed to the rule of law and our constitutional values.”
. It was also held: (SCC p. 467, para
24) “24….. The very purpose of issuing rules/instructions is to ensure their enforcement lest the rule of law should be a casualty.”
. It was further held: (SCC p. 471, para
31) “31….. The contract is … awarded normally to the lowest tenderer which is in public interest [and that]. it is equally in public interest to adhere to the rules and conditions subject to which bids are invited.”
. Learned Counsel also relied on an unreported decision dated 23 December, 2015 of a Division Bench of this Court in the case of Orient Blackswan Private Limited Vs. Sandip Nayak (MAT111OF2015. Learned Counsel relied on paragraph 26 of the said Judgment which is set out hereunder:-
“26. It is trite law that rules of the game cannot be changed in the midst of the tendering process and in the instant case such change of terms of tender as reflected in the points of consideration and the consequential decision taken thereon is liable to be quashed on this ground alone. In the event terms of tender were altered by the authority, it was incumbent on its part to proceed with a fresh tender and not award work order to existing bidders under such altered terms. At this juncture, it may be profitable to note the observations of the Apex Court in Monarch Infrastructure (P) Ltd. v. Commissioner, Ulhasnagar Municipal Corporation & Ors. MANU/SC/032/2000: (2000)5 SCC287 “…… The High Court had taken the view that if a term of the tender having been deleted after the players entered into the arena it is like changing the rules of the game after it had begun and, therefore, if the Government or the Municipal Corporation was free to alter the conditions, fresh process of tender was the only alternative permissible. Therefore, we find that the course adopted by the High Court in the circumstances is justified because by reason of deletion of a particular condition wider net will be permissible and a larger participation or more attractive bids could be offered.”
. The aforesaid principle applied with full force to the facts of the case and the only course possible for the Council was to go for fresh tender after altering the terms of the tender in its meeting on 16.05.2013. It has also been argued vehemently that the purported points of consideration noted on 16.05.2013 is a manufactured document. Reliance has been placed on the note dated 28.05.2013 of the Secretary of the Council wherein he claimed he was not present at the meeting and had signed the document without enough scrutiny. It has also been argued that other contemporaneous documents do not reflect the points of consideration.”
. CONTENTION OF RITES:- (14) Learned Counsel for RITES submitted that under the MOU executed by and between CIL and RITES, the latter was to provide Project Management Consultancy Services for all Rail Infrastructures and allied civil works to CIL and its subsidiaries. Such services including preparation of tender documents, notification of NIT, issuance of tenders on behalf of the CIL and its subsidiaries, evaluating the same and taking all follow up steps up to final acceptance of the recommendation. In respect of the present proceeding, RITES is acting as an agent of SECL and is bound by all directions of SECL. Learned Counsel submitted that all technical and financial bids in response to the NIT dated 17 July, 2015 were opened on 17 August, 2015 and 9 September, 2015. On 23 September, 2015, 24 September, 2015 and 30 September, 2015 the technical bids were evaluated by RITES. Jhajharia was held to be technically disqualified since it submitted documents showing that it had performed certain contracts with KSK Mahanadi Power Company Limited. However, it did not submit any documents to show that KSK Mahanadi Power Company Limited was listed in a Stock Exchange in India or Abroad. Thus, the Credential Certificate did not conform to the qualifying criteria and as such RITES held Jhajharia to be technically disqualified. The evaluation report was placed before the Director (Projects) of RITES before the matter was placed before SECL. The Tender Committee deliberated on 13 October, 2015 and made its observation. On 20 October, 2015, Director (Projects) of RITES accepted the recommendation of the Tender Committee. The opinion of the legal department of SECL pertaining to Jhajharia’s complain in relation to the subject matter was taken into consideration. Accordingly on 23 October, 2015, the Tender Committee recommendations as accepted by the Director (Projects) of RITES were sent to SECL along with the files. However, under cover of a letter dated 3 December, 2015 SECL sent back all the files to RITES after perusing the evaluation report which included the rejection of Jhajharia’s bid. It was stated by SECL that the matter may be decided by RITES for evaluation as per MOU dated 28 June, 2010 and the final Tender Committee recommendations may be sent for acceptance and approval of SECL. It was further stated that the recommendations of RITES should be in accordance with the NIT conditions, natural justice and the law of the land. (15) Accordingly RITES proceeded with the matter and informed Jhjharia and all other bidders as to whether their technical bids had been accepted or rejected. A letter dated 8 December, 2015 was issued to Jhajharia by RITES. (16) RITES decided to open the financial bids on 14 December, 2015 and accordingly issued letters to the technically qualified bidders. However, due to the non-availability of the concerned representative of SECL to witness the price bid opening program, the date was rescheduled to 18 December, 2015 and later on was postponed till further advise. (17) By a letter dated 1 January, 2016 SECL called upon RITES to take a final logical decision in the matter and send all the files to SECL. Under cover of letter dated 1 January, 2016, RITES sent all the files to SECL. (18) Thereafter, by a letter dated 30 January, 2016, SECL directed RITES to consider the bids of 8 bidders including Jhajharia. RITES is bound to abide by such direction and had proceeded on that basis subject to orders which have been passed by this Court. CONTENTION OF SECL:- (19) Appearing on behalf of SECL Mr. Bose, learned Senior Counsel, submitted that in the notice inviting tender, SECL has been mentioned as the Employer. The bids were to be opened by SECL as the Employer. It was SECL who was to scrutinize the bids. Clause 16 of the NIT states that the right to accept or reject the tender is that of SECL. The Contract has also to be entered into with SECL. The role of RITES is that of an agent. The MOU that was entered into by and between CIL and RITES clearly states that acceptance/approval of tender evaluation statement and placement of letter of intent on the contractor has to be done by CIL’s subsidiary, in this case SECL. (20) After opening of the technical bids on 9 September, 2015 by RITES in presence of Jhajharia, the latter sent two representations to SECL dated 24 September and 26 September, 2015. Thereafter Jhajharia filed a writ petition in the Bilashpur High Court against SECL and RITES and the same was disposed of by an order dated 7 October, 2015 by directing that such representations should be disposed of by a reasoned order. Subsequently, RITES communicated the Tender Committee report to SECL for approval by letter dated 23 October, 2015. SECL obtained legal opinion which differed from the opinion of RITES. A Committee was constituted by SECL for approval of the recommendation forwarded by RITES and the matter was sent back to RITES for further consideration under cover of a letter dated 3 December, 2015. RITES rejected the representations of Jhajharia by a communication dated 8 December, 2015. Such decision was challenged by Jhajharia in the Bilashpur High Court. The said writ petition was disposed of by the Bilashpur High Court by an order dated 22 December, 2015. On 1 January, 2016 RITES was requested by SECL to return the entire file relating to tender for consideration by SECL. A Committee of SECL was constituted which recommended on 29 January, 2016 that the bids of the two bidders being Jhajharia and T&T who had been technically disqualified earlier by RITES be also considered and the L-1 bidder be chosen. Such decision of the committee was approved by the competent authority of SECL i.e. the Director Technical (Operation) on 30 January, 2016 and by a communication of the same date RITES was instructed to open the bids and award the contract. It was only thereafter i.e. on 1 February, 2016 that the appellants’ advocate sent a representation to RITES seeking opening of the financial bids of the technically eligible bidders only. (21) Learned Counsel submitted that the instant appeal is not maintainable. Having regard to the scope of the prayers in the representation and the communication dated 30 January, 2016, learned single Judge passed the impugned order and granted liberty to the writ petitioners to challenge such decision before the appropriate forum. Instead of challenging the decision made on 30 January, 2016, the writ petitioners have preferred the instant appeal. (22) Learned Senior Counsel then submitted that apart from the appeal being not maintainable, the challenge with regard to the technical qualification of Jhajharia at the instance of the appellants is not justiciable and not maintainable for the following reasons:- (A) The appellant Company which was allowed to participate in the bidding process does not have any locus standi to challenge the qualification of Jhajharia. (B) It is not the case of the writ petitioners/appellants that they were disqualified on the same ground at the technical stage. No prejudice has been caused to the writ petitioners at the technical stage. (C) It does not lie in the mouth of the writ petitioners to allege that the course adopted by SECL may have caused prejudice to the other parties. Such other parties have not applied before this Court. This is only an attempt on the part of the writ petitioners to gain immunity from competition. Further, whether or not Jhajharia is technically qualified is for SECL to Judge and consider and it is not in the domain of the Court to decide the same in exercise of writ jurisdiction. In this Connection, learned Counsel relied on a decision of the Hon’ble Supreme Court in the case of G.J.
Fernandez Vs. State of Karnataka and Ors. reported in (1990)2 SCC488 In particular, learned Counsel relied on paragraph 15 of the Judgment which is set out hereunder:- “Thirdly, the conditions and stipulations in a tender notice like this have two types of consequences. The first is that the party issuing the tender has the right to punctiliously and rigidly enforce them. Thus, if a party does not strictly comply with the requirements of paras III, V or VI of the N.I.T., it is open to the K.P.C. to decline to consider the party for the contract and if a party comes to Court saying that the K.P.C. should be stopped from doing so, the Court will decline relief. The second consequence, indicated.by this Court in earlier decisions, is not that the K.P.C. cannot deviate from these guidelines at all in any situation but that any deviation, if made, should not result in arbitrariness or discrimination. It comes in for application where the non-conformity with, or relaxation from, the prescribed standards results in some substantial prejudice or injustice to any of the parties involved or to public interest in general. For example, in this very case, the K.P.C. made some changes in the time frame originally prescribed. These changes affected all intending applicants alike and were not objectionable. In the same way, changes or relaxations in other directions would be unobjectionable unless the benefit of those changes or relaxations were extended to some but denied to others. The fact that a document was belatedly entertained from one of the applicants will cause substantial prejudice to another party who wanted, likewise, an extension of time for filing a similar certificate or document but was declined the benefit. It may perhaps be said to cause prejudice also to a party which can show that it had refrained from applying for the tender documents only because it thought it would not be able to produce the document by the time stipulated but would have applied had it known that the rule was likely to be relaxed. But neither of these situations is present here. Sri Vaidhyanathan says that in this case one of the applicants was excluded at the preliminary stage. But it is not known on what grounds that application was rejected nor has that party come to Court with any such grievance. The question, then, is whether the course adopted by the K.P.C. has caused any real prejudice to the appellant and other parties who had already supplied all the documents in time and sought no extension at all?. It is true that the relaxations of the time schedule in the case of one party does affect even such a person in the sense that he would otherwise have had one competitor less. But, we are inclined to agree with the respondent's contention that while the rule in Ramana's case (supra) will be readily applied by Courts to a case where a person complains that a departure from the qualifications has kept him out of the race, injustice is less apparent where the attempt of the applicant before Court is only to gain immunity from competition. Assuming for purposes of argument that there has been a slight deviation from the terms of the NIT, it has not deprived the appellant of its right to be considered for the contract; on the other hand, its tender has received due and full consideration. If, save for the delay in filing one of the relevant documents, M.C.C. is also found to be qualified to tender for the contract, no injustice can be said to have been done to the appellant by the consideration of its tender side by side with that of the M.C.C. and in the K.P.C. going in for a choice of the better on the merits. The appellant had no doubt also urged that the M.C.C. had no experience in this line of work and that the appellant was much better qualified for the contract. The comparative merits of the appellant vis-a-vis M.C.C. are, however, a matter for the K.P.C. (counselled by the T.C.E.) to decide and not for the Courts. We were, therefore, rightly not called upon to go into this question.”
. (D) A writ Court does not convert itself into a Pre-technical Committee to find out whether the requirements have been fulfilled or not. The facts and circumstances of the instant case would show that SECL had considered the inclusion of two other bidders namely Jhajharia and T&T after due deliberation. The stand of SECL cannot be termed arbitrary or unfair. The object of tender, in most of the matters is to satisfy the authority that the person who intends to execute the work or the person who offers tender would be really worthy and that he would perform to the best of his ability. The writ Court usually does not interfere with such decision of the Employer. The facts of the case would reveal that SECL has not acted in an arbitrary manner but has in fact ensured that no prejudice is caused to any party at the technical stage. In the absence of prejudice caused to the writ petitioners or arbitrariness at the end of SECL, the writ petition is not maintainable. (23) Schedule F of the tender which is a part of the NIT, contains clause 46.17 which is a jurisdiction clause and the Chosen Forum is the Bilashpur High Court. Learned counsel submitted that all decisions relating to the tender must be challenged before the Bilashpur High Court. The site of the project and the work is Chattisgarh. The Head Office of SECL is in Chattisgarh. RITES is only the agent. RITES has offices in various parts of India and the Head Quarter of the Eastern Region is in Calcutta. The approval of every decision in the tender is that of SECL and RITES merely communicates such decision. Initially the earnest money was to be paid and the Bank guarantee was to be furnished to RITES at its Gurgaon Office (Clause 9.1 of the tender). This was subsequently changed in the corrigendum to the effect that payment has to be made directly to SECL. Three previous writ petitions have been filed in the Bilashpur High Court and in the decision of SECL, reference has been made to the order passed by Bilashpur High Court. It is Bilashpur High Court which is the natural forum, if not the only forum for adjudication of any dispute which may arise in respect of processing of the tender. (24) It was finally submitted by learned Counsel for SECL that the stand of the writ petitioners/appellants is also not bona fide. At the technical stage, it was not possible for the writ petitioners to know the details of bids submitted by other bidders. The writ petition was filed before opening of the financial bids. From the financial bids, it would appear that Jhajharia is L-1 bidder and the writ petitioner Company is the L-2 bidder. The bid of Jhajharia is about Rs. 7 crores less than that of the writ petitioner company. The writ petitioner Company has not offered to match the bid of Jhajharia before this Court to show its bona fide. In any case, even if such offer had been made it would not have been open to SECL to accept such offer since the same would be contrary to the terms and conditions of NIT. Under the tender, SECL can only accept the bid of the L-1 bidder. But the very fact that no offer was made by the writ petitioner Company before this Court shows lack of bona fide on the part of the writ petitioner Company. The only attempt is to oust competition which is neither desirable in public interest nor beneficial to the interest of SECL. CONTENTION OF JHAJHARIA (RESPONDENT No.4):- (25) Learned Counsel for Jhajharia has taken three preliminary objections to the maintainability of the appeal. The first preliminary objection is that the appeal is beyond the scope of the writ petition. The writ petition was filed on the basis that when technical bids were opened on 17 August, 2015, only six bidders were found to be qualified and Jhajharia had been disqualified on the same date. Thereafter letters dated 9 December, 2015, 10 December, 2015 and 16 December, 2015 were written by RITES to the appellant initially fixing and then rescheduling dates for opening of financial bids and then postponing the same. This according to the appellants showed that RITES was acting in collusion with the bidders who had been technically disqualified. On this basis, the writ petition was filed seeking finalization of the tender process by evaluation of financial bids of the qualified bidders named by the writ petitioners. In the writ petition, there is no challenge to the decision of the respondent authorities finding Jhajharia to be technically qualified. However, in the appeal, the only point urged is that the decision of the respondent authorities to technically qualify Jhajharia was bad in law. This point was not urged in the writ petition. Hence, the appellants cannot raise this issue for the first time in this appeal. This is more so since the learned Judge has given liberty to the appellants to urge these points before the appropriate forum. (26) The second preliminary objection taken by learned Counsel is that of jurisdiction of this High Court to entertain the writ petition. This point is similar to the objection taken by the learned Counsel for SECL and is based on clause 46.17 of schedule F referred to in the NIT. It was further submitted that no part of the cause of action has arisen within the jurisdiction of this Court since:- (i) The works are to be carried out in Chattisgarh. (ii) SECL, who is the Employer is to take all decisions in the matter of grant or rejection of the bids. SECL’s office is in Bilashpur, Chattishgarh. (iii) The letters dated 9 December, 2015, 10 December, 2015 and 16 December, 2015 which were referred to in the writ petition were also issued to and received by the appellants at their office in Jamshedpur. (iv) No communication was issued to the appellants by RITES or any other respondent authority from the office of the appellants in West Bengal. The appellants had initially sought to make SECL a party to the writ petition as would appear from the contents of the writ petition and realizing that in such event, there would be an objection as to jurisdiction, the appellants made RITES, who have an office in Calcutta, and an officer of RITES parties to the writ petition, so that the jurisdiction of this Court could be attracted not on the basis of cause of action but on the basis that RITES has its office in Kolkata. This the appellants did in spite of being aware that the entire tender had been issued by RITES on behalf of SECL. The appellants have thus sought to mala fide invoke the jurisdiction of this Court knowing that RITES was an agent of SECL and it was only the actions of SECL that could be challenged. (27) The third preliminary objection to the maintainability of the appeal is that the writ petitioners have no locus standi since they are not persons aggrieved. Liberty has been given to the writ petitioner Company by the impugned order to approach the appropriate forum if it has any grievance as regards Jhajharia being treated as a qualified tenderer. Further, merely because Jhajharia’s financial bid is directed to be opened, the same cannot make the appellants persons aggrieved as the appellant’s financial bid will also be considered. The right of the writ petitioner Company to participate in the tender process has not been taken away in any manner by the impugned order. Upon opening of the financial bids, Jhajharia has been found to be the lowest bidder. Awarding the contract to Jhajharia will benefit the State Authorities and result in saving of a sum in excess of Rs. 7 crores. The appellants are merely seeking to have Jhajharia ousted from the zone of consideration though it is fully qualified to do work as the appellants do not want competition. The appellants, not having been kept out of the zone of consideration cannot complain. In this connection, learned Counsel relied on paragraph 15 of the Judgment of the Hon’ble Apex Court in the case of G.J.
Fernandez Vs. State of Karnataka and Ors.(supra) which has been extracted above. (28) On merits, learned Counsel submitted that the decision of SECL to consider Jhajharia as qualified, is neither arbitrary nor contrary to law or the terms of the tender. He submitted that Jhajharia had submitted the Credential Certificate as issued by KSK Mahanadi Power Company Limited, which is a subsidiary of KSK Energy Ventures Limited. Along with the Certificate Jhajharia submitted a Certificate issued by KSK Energy Ventures Limited Stating that KSK Mahanadi Power Company Limited is a part of KSK Energy Ventures Limited. The contents of this Certificate have not been disputed by anybody concerned. KSK Energy Ventures Limited is a listed Company in India and abroad. Along with the said Certificates, Jhajharia made available to both RITES and SECL, the annual report of KSK Energy Ventures Limited for the year 2014-2015 from which the following would appear: i) KSK Energy Ventures Limited holds 84.71 per cent shares in KSK Mahanadi Power Company Limited and hence exercises complete control over its managements and affairs. ii)The assets, liabilities and business of KSK Mahanadi Power Company Limited is treated by KSK Energy Ventures Limited as a part of its own assets, liabilities and business. iii) The holding Company carries on business through its subsidiaries. Therefore, the annual report of KSK Energy Ventures Limited refers to itself and its subsidiaries as a ‘Group’ i.e. single economic entity. iv) KSK Mahanadi Power Company Limited is the highest profit making subsidiary of KSK Energy Ventures Limited and therefore it contributes substantially to the assets and income of KSK Energy Ventures Limited. The turnover and profit of KSK Mahanadi Power Company Limited is far more than its holding Company KSK Energy Ventures Limited. v) Both KSK Mahanadi Power Company Limited and KSK Energy Ventures Limited have common directors. vi) All necessary statutory disclosures which are required to be made by a holding Company with respect to its subsidiaries, in terms of the relevant provisions of the Companies Act, 2013 have been made by KSK Energy Ventures Limited with respect to KSK Mahanadi Power Company Limited. (29) Learned Counsel submitted that the relationship between a holding Company and subsidiary Company has to be seen from the stand point of business realities. A subsidiary company is not always treated as a separate legal entity vis-a-vis the holding company. In the instant case, KSK Energy Ventures Limited and its subsidiaries have been legitimately treated as one economic entity. In this connection, learned Counsel relied on a decision of the Hon’ble Supreme Court in the case of New Horizons Limited Vs. Union of India reported in (1995)1 SCC478 Learned Counsel relied on paragraphs 27 to 36 of the Judgment wherein the Hon’ble Apex Court discussed the circumstances in which the corporate veil of a limited Company would be pierced and the Court would go behind the corporate personality to the individual members or ignore the separate personalities of each company in favour of the economic entity constituted by a group of associated Companies. (30) The next submission of learned Counsel was that the affairs of a Company include the affairs of its subsidiary. As such, the certificate issued by KSK Mahanadi Power Company Limited is equivalent to a certificate issued by its holding company KSK Energy Ventures Limited which is undisputedly a listed Company. In this connection, learned counsel relied on a decision of this Court in the case of Bajrang Prasad Jalan Vs. Mahavir Prasad Jalan reported in AIR1999CAL156wherein at paragraph 27 the Court observed that “It is also a trite law that over the affairs of Company in question its entire affairs including those of the subsidiary Company can also be looked into.”
. (31) Learned Counsel’s next submission was that undisputedly necessary works have been carried out by Jhajharia for KSK Mahanadi Power Company Limited with respect to which the Credential Certificate has been issued. RITES has, by a letter dated 16 September, 2015 verified such facts from KSK Mahanadi Power Company Limited. It cannot be said that the Credential Certificate issued by KSK Mahanadi Power Company Limited cannot be treated as a Certificate issued by KSK Energy Ventures Limited. Submission of the Credential Certificate as issued by KSK Mahanadi Power Company Limited can therefore be treated as compliance of the relevant qualifying criteria as contained in the NIT. (32) Learned Counsel then submitted that the scope of judicial review of a decision taken in a tender process is extremely limited. Unless it can be demonstrated that the decision making process is arbitrary or violative of Article 14 of the Constitution of India, the Courts should not exercises their writ jurisdiction to interfere with such decision. In this connection, learned Counsel relied on a decision of the Hon’ble Supreme Court in the case of TATA Cellular Vs. Union of India reported in (1994)6 SCC651 Reliance was placed on paragraphs 94 and 137 of the Judgment which are set out hereunder:-
“94. The principles deducible from the above are : (1) The modern trend points to judicial restraint in administrative action. (2) The court does not sit as a court of appeal but merely reviews the manner in which the decision was made. (3) The court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible. (4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. 688 Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts. (5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principle of reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides. (6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure. Based on these principles we will examine the facts of this case since they commend to us as the correct principles.
137. In Poddar Steel Corpn. v. Ganesh Engineering Works13 this Court observed : (SCC p. 276, para
6) "As a matter of general proposition it cannot be held that an authority inviting tenders is bound to give effect to every term mentioned in the notice in meticulous detail, and is not entitled to waive even a technical irregularity of little or no significance. The requirements in a tender notice can be classified into two categories those which lay down the essential conditions of eligibility and the others which are merely ancillary or subsidiary with the main object to be achieved by the condition. In the first case the authority issuing the tender may be required to enforce them rigidly. In the other cases it must be open to the authority to deviate from and not to insist upon the strict literal compliance of the condition in appropriate cases."
(33) Learned Counsel submitted that it cannot be said that the Credential Certificate from a listed Company is an essential term of the tender and there is no stipulation to that effect. There is also nothing to indicate in the tender documents as to why only a Credential Certificate from a listed Company is required and nor is there a provision to the effect that the bid will be rejected if the Credential Certificate is issued by a Company which is not listed. In the present case, none of the conditions which would call for interference by the writ Court has been fulfilled. It cannot be said that the respondent authorities have acted in a manner in which no authority reasonably instructed would have acted or that the interpretation given to the tender conditions by the respondent authorities is absolutely illegal. Such interpretation in fact finds support from the Supreme Court decision in the case of New Horizons Limited (supra). (34) Learned Counsel for Jhajharia finally submitted that there has been suppression of material facts on the part of the appellants. The technical bid of Jhajharia was also disqualified with regard to an issue as to submission of earnest money deposit. Subsequently, pursuant to an order dated 27 August, 2015 passed by the Bilashpur High Court such EMD was accepted by the respondent authorities. By a letter dated 3 September, 2015 RITES communicated to the appellants that the technical bid of Jhajharia was to be opened on 9 September, 2015. This letter was also forwarded to the other bidders including the writ petitioners. In the writ petition, the factum of this letter has been completely suppressed. The qualification of Jhajharia to participate in the tender process pursuant to the aforesaid letter has not been challenged in the writ petition but the writ petitioners have sought to proceed on the basis that Jhajharia was disqualified on 17th August, 2015. The writ petition and the appeal are liable to be dismissed on the ground of suppression alone. THE APPELLANTS IN REPLY :- (35) In reply, learned Counsel for the appellants submitted that in the case of G.J.
Fernandez (supra) it has been held that a non-essential term can be departed from and/or waived by the authority issuing NIT and that the Court will not interfere with the interpretation given by such Authority for determining whether a term is a “minimum pre- qualifying/eligibility condition”. or is in the nature of a “general requirement”.. In the instant case, RITES has found the Credential Certificate/criteria to be a “pre-qualifying/eligibility condition”.. Hence, the said criterion cannot be departed from or waived. (36) Learned Counsel then submitted that in its judgment in the case of New Horizons Limited (supra), the Hon’ble Supreme Court has not held that in tender matters, the corporate veil should be lifted on every aspect. In this connection, learned Counsel relied on a decision of the Hon’ble Supreme Court in the case of Gammon India Limited Vs. Commissioner of Customs reported in (2011)12 SCC499 wherein at paragraphs 16 to 18 of the Judgment the Hon’ble Supreme Court discussed its earlier decision in the case of New Horizons Limited(supra) in which the Hon’ble Supreme Court was dealing with the case of a Joint Venture Company. However, KSK Mahanadi Power Company Limited is not a Joint Venture Company and it is also not the bidder whose eligibility criterion is under consideration. In fact, clause 2.4 of the NIT specifically provided that in the subject tender Joint Venture is not allowed. Further, clause 6(d) expressly provides that the experience of the holding company cannot be taken into consideration if the bidder is a wholly owned subsidiary of a Company. (37) Learned Counsel then submitted that reliance on the case of Bajrang Prasad Jalan(supra) by the respondents is wholly misplaced and in subsequent decisions the said case has been held to be confined to its peculiar facts. In this connection, learned Counsel relied on a decision of the Madras High Court in the case of Amalgamations Limited Vs. Shankar Sundaram reported in (2012) 1 Company Law Journal 568. Learned Counsel submitted that in the said decision of the Madras High Court reasons have been given as to why the affairs of a Company cannot include the affairs of a subsidiary Company and its holding company as if they were a part of one entity. A wholly owned subsidiary Company is distinct from its holding company even if all the shares of the subsidiary Company are held by the holding Company. In this connection, learned Counsel relied on a decision of the Hon’ble Supreme Court in the case of Electronics Corporate of India Limited Vs. Secretary Revenue Department, Government of Andhra Pradesh reported in (1999) 4 SCC458 Reliance was also placed on a decision of the Supreme Court in the case of Vodafone International Holdings Vs. union of India reported in (2012) 6 SCC613 Learned Counsel relied on paragraphs 258 to 260 of the said Judgment which are set out hereunder:-
“258. Holding company, of course, if the subsidiary is a WOS, may appoint or remove any director if it so desires by a resolution in the General Body Meeting of the subsidiary. Holding companies and subsidiaries can be considered as single economic entity and consolidated balance sheet is the accounting relationship between the holding company and subsidiary company, which shows the status of the entire business enterprises. Shares of stock in the subsidiary company are held as assets on the books of the parent company and can be issued as collateral for additional debt financing. Holding company and subsidiary company are, however, considered as separate legal entities, and subsidiary are allowed decentralized management. Each subsidiary can reform its own management personnel and holding company may also provide expert, efficient and competent services for the benefit of the subsidiaries.
259. The U.S. Supreme Court in United States v. Bestfoods 524 US51(1998) explained that it is a general principle of corporate law and legal systems that a parent corporation is not liable for the acts of its subsidiary, but the Court went on to explain that corporate veil can be pierced and the parent company can be held liable for the conduct of its subsidiary, if the corporal form is misused to accomplish certain wrongful purposes, when the parent company is directly a participant in the wrong complained of. Mere ownership, parental control, management etc. of a subsidiary is not sufficient to pierce the status of their relationship and, to hold parent company liable. In Adams v. Cape Industries Plc. (1991) 1 All ER929 the Court of Appeal emphasized that it is appropriate to pierce the corporate veil where special circumstances exist indicating that it is mere fagade concealing true facts.
260. Courts, however, will not allow the separate corporate entities to be used as a means to carry out fraud or to evade tax. Parent company of a WOS, is not responsible, legally for the unlawful activities of the subsidiary save in exceptional circumstances, such as a company is a sham or the agent of the shareholder, the parent company is regarded as a shareholder. Multi-National Companies, by setting up complex vertical pyramid like structures, would be able to distance themselves and separate the parent from operating companies, thereby protecting the multi-national companies from legal liabilities.”
. (38) As regards the point of territorial jurisdiction of this Court to entertain the writ petition, learned Counsel submitted that it is an admitted position that as per the tender terms the following parts of the cause of action have arisen within the jurisdiction of this Court:- (i) The tender documents were issued from the office of RITES at Kolkata (clauses 5.1 and 5.2 of NIT). (ii) For clarification of any term of the tender documents queries were addressed to RITES at Kolkata (clause 5.5 of NIT). (iii) The pre-bid meeting was held at the office of RITES at Kolkata (clause 6.0 of NIT). (iv) The receipt and opening of tender applications were to be made at the office of RITES at Kolkata (Clause 12.1 of NIT). (v) In fact, the tender bids were opened on 9 September, 2015 at the office of RITES at Kolkata. (vi) Notices dated 9 September, 2015 were issued by RITES for opening of the price bid at its office at Kolkata. (vii) SECL’s letter dated 30 January, 2016 is addressed to RITES at its office at Kolkata. (39) Learned Counsel then submitted that in so far as a writ petition is concerned, forum selection Clause does not apply. In this connection, learned Counsel relied on a decision of this Court in the case of Ashok Kr. Saboo(HUF) Vs. Hindustan Paper corporation Limited reported in (2007) 3 CHN533 Reliance was placed on paragraphs 12 and 21 of the Judgment which are set out hereunder:-
“12. It is plain from the above clause that the resolution of legal dispute if arises will have to be brought by any of the parties on the strength of the aforesaid agreement before the Appropriate Civil Court at the place in the State of Assam. In the writ petition upon scrutiny we find enforcement of civil right and/or complaint in connection with breach of contractual obligation is not the subject matter. Grievance in the writ petition is for enforcement of right as guaranteed under the Constitution of India. Civil Court has no power to entertain any dispute as required to be resolved by the Writ Court. Therefore, we are of the view that the aforesaid agreement selecting forum is only applicable in case of litigation brought in the private law field. Besides, the agreement appears to be vague and such an agreement cannot operate as bar. Moreover, it is impossible to think that the provision under Article 226 can be contracted out by selecting one of the two competent forums. There cannot be estoppel as against provision of Constitutional law. The legality and validity of forum selection agreement is indirectly recognized under the provision of Section 28 of the Contract Act. This provision does not envisage, in our view recognition and acceptance of contracting out of the provision of Article 226 of the Constitution of India. Thus, we are unable to subscribe the contention raised by Mr. Chatterjee that forum selection clause operates as a bar to entertain writ petition by this Court. Therefore, findings of the learned Trial Judge to that extent is not accepted by this Court and the same is patently erroneous on fact and in law. This view of the learned Trial Judge is accordingly negative by this Court.
21. The learned Single Judge missed to take note of the aforesaid observation of the Division Bench which is binding upon him as it was directly on this issue. Rather he has relied on a decision of the learned Single Judge. The decision cited by Mr. Chatterjee rendered by the learned Single Judge in the case of Calpro Food (Pvt.) Ltd. reported in MANU/WB/0508/1995:100 CWN322had nothing to do with the question of office of the respondent, rather the said was founded on the cause of action while attracting territorial jurisdiction of this Court. Moreover, the learned Single Judge’s observation in paragraph 5 that the provision of Article 226 can be contracted out under the provision of Section 28 of the Contract Act is not sustainable in law as we have observed that the provision of Article 226 is a Constitutional provision and it cannot be contracted out by the act of the parties. The said Judgment is not a good law as far as contracting out the provision of Article 226 of the Constitution of India is concerned. It is now firmly settled that this provision is one part of basic structure of the Constitution and it is inviolable even by the Parliament, not to speak of private individual.”
. (40) Learned Counsel finally submitted that in any event the jurisdiction clause contained in NIT is a term which was to be incorporated in the contract that would be entered into with the successful bidder. The jurisdiction clause would apply to future disputes that may arise in course of performance of the contract between the employer and the contractor. Such Clause cannot stand in the way of this Court entertaining the instant writ petition. Court’s View:- (41) Although submissions have been made by Learned Counsel for the parties at length and we have thought it fit and proper to record the same, the point that falls for determination is a short one. The Learned Judge in the impugned judgment and order directed that RITES shall be entitled to consider the financial bids of all the eight bidders (including Jhajharia and T & T) who have been found to be qualified either at the instance of RITES or at the instance of SECL. The appellants are aggrieved by such direction. The question is whether or not the appellants can make a legitimate grievance in respect of the aforesaid direction of the learned Judge. (42) Briefly put, the complaint of the appellants is that Jhajharia did not satisfy the condition stipulated in Note No.5 under Clause 2(a) of the NIT. The said note provided that a credential certificate had to be submitted by the bidder along with the tender. Such certificate could be issued by Government or semi-Government organizations of the Central or State Government or by Public Sector Undertakings/Autonomous Bodies of the Central or State Government or by Public Limited Companies listed in Stock-Exchange in India or abroad. Jhajharia submitted a credential certificate issued by KSK Mahanadi Power Co. Ltd. which is admittedly not a listed company, but which is a subsidiary of a listed company by the name of KSK Energy Ventures Ltd. Learned Counsel for the appellants contended that this is not in compliance with the requirement of Note No.5 under Clause 2(a) of the NIT, thus disqualifying Jhajharia for the purpose of the subject tender. According to him, KSK Mahanadi may be a fully owned subsidiary or a substantially held subsidiary of KSK Energy Ventures but in law, they are two separate legal entities and the work experience or commercial worth of the holding company cannot be reflective of the work experience/efficiency or commercial credibility of the subsidiary company. As such, SECL could not have directed RITES to consider the bid submitted by Jhajharia as the same amounted to relaxation of an essential term/condition of the tender midway during the tender process. (43) From the facts of the case and submissions of the parties noted above, it would appear that under the MOU dated 28 June, 2010, CIL appointed RITES as its project management consultant. The MOU was subsequently modified and it was clarified that in respect of engineering and project management consultancy and approval of tenders the subsidiary of CIL (in this case SECL) would be the final authority. (44) RITES floated the subject tender on behalf of the SECL inviting bids from interested parties and in doing so, RITES was acting as an agent of SECL. Initially, out of the ten bidders, six were found to be technically qualified. Jhajharia was one of the bidders who was found not to be technically qualified for the reason that the credential certificate it had submitted was issued by a public limited company which was not listed in a Stock Exchange in India or abroad. (45) Subsequently, the committee constituted by SECL recommended that the bids of Jhajharia and T & T who had been technically disqualified earlier by RITES be also considered and the L-1 bid be chosen. The Competent Authority of SECL approved such decision of the committee and by a communication dated 30 January, 2016 RITES was instructed by SECL to open the bids and award the contract. In our opinion, RITES, which was acting as an agent of SECL was bound by the instruction of SECL. It is trite law that an agent is bound by the principal’s mandates and cannot act beyond or contrary to such mandates. (46) The question then arises as to whether SECL was justified in instructing RITES to consider the financial bid of Jhajharia. Did SECL commit any illegality or irregularity by bringing Jhajharia into the zone of consideration by directing RITES to open Jhajharia’s financial bid?. In our view, the answer must be in the negative. We are of the opinion that the requirement of submitting a credential certificate issued by a listed public limited company was not an essential term/condition of the NIT. Such a certificate had been called for to assess past the performance and credibility of the bidder in question. The requirement that if the credential certificate was that of a public limited company then that company must be a listed company was only to lend more credence to the certificate, as listed companies are generally placed on a higher commercial pedestal than unlisted companies. If the Employer (SECL) could otherwise ascertain the credibility and past record of a bidder and if the bid of that party is the lowest, nothing would prevent the Employer from considering that party’s financial bid even if the credential certificate was not issued by a listed public limited company. (46) As observed by the Hon’ble Supreme Court in the case of Tata Cellular (supra), an authority inviting tenders is not bound to give effect meticulously to every term mentioned in the NIT and is entitled to waive a technical irregularity of little or no significance. In our view, the term in question was not an essential term of NIT which warranted compliance with unbending rigidity. (47) In the instant case, SECL is the proposed Employer. The tender was floated by RITES on behalf of SECL. The object of a tender process in respect of work projects is not only to ascertain the lowest price at which the work can be got executed but also to assess the credibility and capability of the bidding parties who are interested to perform the job. The lowest tenderer need not always be awarded the work if it is found that he has a dubious or unsatisfactory track record or if on an overall assessment the authority concerned is of the opinion that his capability is doubtful. It is settled law that the Government and public authorities must have freedom of contract. In the present case, SECL found the financial bid of Jhajharia to be the lowest. It was about 7 crores less than the second lowest bid that was of the appellant. It is not in dispute that Jhajharia carried out work satisfactorily for KSK Mahanadi and this has been verified from KSK Mahanadi by RITES. Being satisfied by the capability of Jhajharia, SECL directed RITES to consider Jhajharia’s financial bid along with the financial bids of others including that of the appellants. We see absolutely nothing illegal or irregular with such action of SECL. (48) Learned Counsel for the appellants, relying on two decisions referred to above, urged that the decision of SECL to open the financial bid of Jhajharia even when the credential certificate was not issued by a listed public limited company, amounted to changing the rules of the game once the game has started, which is impermissible in law. We would have agreed with such contention of Learned Counsel if we were of the opinion that Note 5 to Clause 2(a) of the NIT constitutes an essential condition of the NIT. According to us, it was a non-essential condition and relaxation thereof or deviation therefrom even at the stage of consideration of financial bids did not amount to any irregularity. Further, the same did not prejudice the appellant company in any manner as its financial bid would be considered along with the financial bid of Jhajharia. In our view, the appellant company is not a party aggrieved and, hence, even its locus standi to maintain the present writ petition is highly doubtful. (49) In any event, in ascertaining whether a condition in a NIT has been complied with, one has to take a commercial point of view. It is not in dispute that KSK Mahanadi which issued the credential certificate to Jhajharia is a subsidiary of KSK Energy Ventures. In fact, KSK Energy Ventures holds approximately 84 per cent of the shares in KSK Mahanadi. KSK Energy Ventures in its annual report referred to itself and its subsidiaries as a ‘Group’ i.e. a single economic entity. KSK Energy Ventures appears to be in complete control of the management and administration of the affairs of KSK Mahanadi and this is a commercial reality which cannot be lost sight of. Although KSK Ventures and KSK Mahanadi may be separate legal entities in the eye of law, from a practical and pragmatic point of view KSK Energy Ventures operates through KSK Mahanadi being 84 per cent shareholder thereof. The Directors of the two companies are also common. Hence, in our opinion, there is substantial compliance of Note 5 under Clause 2(a) of the NIT since KSK Energy Ventures is undisputedly a listed company. (50) SECL’s decision to consider Jhajharia’s financial bid is an administrative decision made qualitatively by experts in the field. If the writ court interferes with such decision lightly without having the necessary expertise such action is likely to be fallible. It is trite law that the writ court is not concerned with the decision but with the decision making process. Unless such process is arbitrary or so unreasonable that no reasonable authority could have made such decision (Wednesbury Unreasonableness) or smacks of breach of natural justice, the High Court would be slow to intervene in the exercise of its high prerogative jurisdiction. (51) The appellants contend that the terms and conditions of tender cannot be changed once the tender process has started. According to them, the rules of a game cannot be altered once the game is on its way. In our opinion, this is not an absolute proposition of law. Firstly, the appellant company cannot claim to have a vested right in being awarded the contract. It is settled law that none of the bidders in a tender process has any legal right in the contract being awarded in his favour. This is so, even if he is the lowest bidder. The Government or a public authority always has a right to reject even the lowest bid for cogent reasons provided such decision is not arbitrary. In the commercial field, the Government or a public authority surely has the freedom of contract and can even amend the terms of a Notice Inviting Tender provided no undue prejudice is caused to a party who has participated in the tender process. In the instant case, the appellant company has not been able to establish as to what prejudice it would suffer by reason of the decision of the respondents to consider the financial bid of Jhajharia. In our opinion, no injustice can be said to have been done to the appellant company by the decision of SECL to consider the tender of Jhajharia side by side with that of the appellant company. The comparative merits of the appellant company viz-a-viz Jhajharia is a matter for SECL to decide and not for the courts. This view of our finds support from the decision of the Hon’ble Apex Court in the case of G. J.
Fernandez (supra). (52) Another reason as to why we decline to interfere is that the decision of SECL to consider the financial bid of Jhajharia and T & T has not been challenged by the writ petitioners. The Learned Judge reserved liberty to the writ petitioners to challenge such decision of SECL before the appropriate forum. Instead of doing so, the writ petitioners preferred the instant appeal. Prayers in the instant appeal are beyond the scope of the writ petition. (53) Before concluding, we may note that Learned Counsel for the appellants vociferously argued that SECL and RITES are acting in tandem and collusion with Jhajharia. We find no substance in such contention and the materials on record also do not support such allegation. Out of the bidders who were initially technically disqualified by RITES, it was not only Jhajharia’s financial bid that SECL directed RITES to consider but also the financial bid of T & T. It was for SECL to finally decide whether those two bidders were technically eligible and no inference of collusion or of SECL or RITES acting hand in glove with Jhajharia can be drawn merely from the decision of SECL to consider the financial bids of Jhajharia and T & T. On the contrary, we are inclined to agree with the submission of Learned Counsel for SECL and Jhajharia that the present litigation is an attempt on the part of the appellant company to scuttle and/or eliminate competition. (54) Since we are disposing of the appeal on merits, we have refrained from expressing any opinion on the point of jurisdiction and forum selection clause. (55) For the reasons aforesaid, this appeal fails and is dismissed. There will, however, be no order as to costs. In view of the aforesaid order GA No.1881 of 2016 is also disposed of. (56) Urgent certified photocopy of this judgment, if applied for, be given to the parties upon compliance of necessary formalities. I Agree. (Manjula Chellur, CJ.) (Arijit Banerjee, J.) Later: Stay of operation of the judgment is prayed for, but the same is refused. (Manjula Chellur, CJ.) (Arijit Banerjee, J.)