9911796707
TMI Blog2018 (9) TMI 2047X X X X Extracts X X X X X X X X Extracts X X X X ..... d Transport Corporation (for short "MSRTC") had issued a tender for appointment of an agency for implementation of a "Vehicle Tracking System and Passenger Information System." The petitioner was one of the bidders in the said tender. Respondent no.2-Rosmerta Autotech Pvt.Ltd. was the successful bidder having submitted the lowest bid(L1). The petitioner interalia prays that the award of the tender in favour of respondent no.2 vide letter of intent dated 16 November 2017, be quashed and set aside, and that a fresh bidding process be undertaken by respondent no.1MSRTC. 3. The principal contention as urged on behalf of the petitioner is that the bid of respondent no.2 was required to be held as nonresponsive by the MSRTC inasmu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncipally the bid was contrary to subclause (8) of paragraph 7.2. 6. The MSRTC has filed a reply affidavit interalia contending that there was nothing arbitrary in the decision making process in entering into negotiations with respondent no.2 who was the lowest bidder and more particularly in view of the new regime of Goods and Service Tax (GST) which was introduced after the publication of tender notice. It is contended that at the time of submission of the bids and at the time of closure of financial bids, the Goods and Service Tax regime was not in force and the GST rates were unknown to the parties and thus the bids were based on the rates of indirect taxes like service taxes, VAT, Excise etc. that prevailed at the time of submissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rates were notified. After the respondent No.2 were declared L1, they were invited for negotiations, so that the tax components of the amount quoted by them could be readjusted to suit the newly introduced GST rates. 9) That pursuant to negotiations a slight revision of prices was allowed in the total CAPEX cost. That the Respondent No.2 had agreed to reduce the Base price of the CAPEX expenses and consequently the only change in prices that occurred was on account of replacement of the currently prevailing tax rates as against the tax rates quoted in the bid, and that too at a substantially discounted base price. As a result, the bid of Respondent No. 2, which initially quoted a total CAPEX cost of Rs. 15.75 Crores on the basis of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n behalf of respondent no.2 it is submitted that the levy of GST was unknown when the tender notice was issued and therefore, the bidders necessarily were required to take into account the GST and the rates so notified by the Government of India in regard to supply which would be undertaken by the successful bidder. Our attention is drawn to a Government Circular dated 19 August 2017 which provides for guidelines on account of implementation of GST from 1 July 2017. It provides that the introduction of GST would change the structure of taxes in the Government contract. Paragraph 3 of the said circular pertains to the tenders accepted before 1 July 2017 and the contracts /work order issued after 1 July 2017. Paragraph 3 reads thus: "3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere required to take into consideration the said condition of Goods and Service Tax as notified in the corrigendum. As pointed out on behalf of MSRTC and as noted by us above, respondent no.2 being L1 being lowest bidder was entitled to negotiate in regard to the lowest bid offered by it and more particularly on taking into consideration the Capital Expenditure cost (CAPEX) and Operational Expenditure Cost (OPEX). The MSRTC has found that the petitioner has appropriately applied the GST in the manner in which it would be beneficial to MSRTC. Respondent no.2 in the negotiations also agreed to reduce the Base price of the CAPEX expenses and consequently the only change in prices that occurred was on account of replacement of the currentl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t behalf by the tendering authority. 12. Having perused the record, we do not find that the approach of MSRTC in any manner unconscionable or arbitrary to accept the lowest bid of respondent no.2. MSRTC has acted in accordance with the tender conditions, and in view of the introduction of new regime of GST during the tendering process, the decision of the MSRTC cannot be said to be contrary to the tender conditions read with the corrigendum. Thus the only contention as urged on behalf of the petitioner that subclause 8 of clause 7.2 of the tender condition stands breached in awarding the contract to respondent no.2, in these circumstances, cannot be accepted. 13. We see no merit in the petition. It is accordingly rejected. No costs.< ..... X X X X Extracts X X X X X X X X Extracts X X X X
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