TMI Blog2024 (3) TMI 583X X X X Extracts X X X X X X X X Extracts X X X X ..... ases where the tender is under process and there is clear indication of rate of GST @ 12%, the Memorandum provides for enhancement by 6% on account of GST. The acceptance order dated January 16, 2023 was issued subsequent to the November 22, 2022 Memorandum and, as such, was subject to the operation of the said Memorandum. Since the petitioner had participated in the tender before the enhancement of GST from 12% to 18%, the provisions of the Memorandum dated November 22, 2022 were squarely applicable in the present case. Thus, the respondent authorities ought to have honoured the commitment of the State issued by way of a Memorandum dated November 22, 2022 by enhancing the GST from 12% to 18% and/or permit the petitioner to refurnish the quotations by incorporating such 6% enhancement, which was the precise request of the petitioner vide its communication dated April 17, 2023. It is well-settled that State actions have to be scrutinized on a higher standard of fairness than the action of private employers. Supreme Court in [ 2019 (3) TMI 600 - SUPREME COURT] categorically applied the Wednesbury test and opened up a window for judicial review even regarding the tender terms where th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f in favour of the petitioner pursuant to the tender-in-question. Alternatively, the respondent will be at liberty to refund the entire earnest money paid by the petitioner with interest @ of 10% till the date of such payment to the petitioner, in which case subsequent action taken by the State in issuing fresh tender shall be sustained. - SABYASACHI BHATTACHARYYA, J. For the Petitioner : Mr. Soumya Majumder, Mr. Subhabrata Das, Mr. Amartya pal, Mr. Kartick Kumar Goyal For the Respondent : Mr. Amal Kumar Sen, Ms. Ashima Das (Sil) ORDER Affidavit-of-service filed in Court today be kept on record. 2. The petitioner has thrown the present challenge against the decision of the respondent authorities to refuse to grant work order to the petitioner, although the petitioner was the L1 bidder in the tender process, and to forfeit the Earnest Money Deposit (EMD) made by the petitioner. 3. Learned counsel appearing for the petitioner contends that initially the petitioner had participated in the tender and had turned out successful. Thereafter an acceptance order was issued on January 16, 2023 indicating that the GST payable was @ 12%. Subsequently, however, by a notification of the Govern ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the Supreme Court reiterated the principle that tender terms fall in the realm of contract and cannot be altered by judicial review unless palpable arbitrariness, discrimination, unreasonableness or malice are established. The Wednesbury Principle was relied on by the Supreme Court in such context. 11. Learned counsel for the State next contends that under Clauses 19 and 21 of the tender document, the respondent authorities had sufficient leeway to terminate the contract. 12. Furthermore, learned counsel places reliance on a communication dated May 10, 2023 made by the petitioner where the petitioner itself stated that it requested honorary termination of the petitioner s bid. Thus, in view of the petitioner s own request to have the tender terminated, the respondent authorities were justified in refusing to issue work order and forfeiting the EMD in terms of the contract. 13. A perusal of Clauses 19 and 21 of the tender document shows that those are subject to certain riders. Whereas Clause 19 stipulates that the contractor whose tender will be accepted shall make the formal agreement within seven days and if he fails to do so, the tender would be liable to be cancelled and ear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssued. In cases where the tender is under process and there is clear indication of rate of GST @ 12%, the Memorandum provides for enhancement by 6% on account of GST. The acceptance order dated January 16, 2023 was issued subsequent to the November 22, 2022 Memorandum and, as such, was subject to the operation of the said Memorandum. Since the petitioner had participated in the tender before the enhancement of GST from 12% to 18%, the provisions of the Memorandum dated November 22, 2022 were squarely applicable in the present case. Thus, the respondent authorities ought to have honoured the commitment of the State issued by way of a Memorandum dated November 22, 2022 by enhancing the GST from 12% to 18% and/or permit the petitioner to refurnish the quotations by incorporating such 6% enhancement, which was the precise request of the petitioner vide its communication dated April 17, 2023 (Annexure P4 at page 70 of the writ petition). 22. It is well-settled that State actions have to be scrutinized on a higher standard of fairness than the action of private employers. 23. Even in the judgement cited by the respondents reported at (2019) 4 SCC 401, the Supreme Court categorically appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner in terms of the tender in which the petitioner participated successfully and the forfeiture of the EMD amount deposited by the petitioner. 31. Insofar as the subsequent tender issued on December 18, 2023 is concerned, the same would obviously be subject to the outcome of the present writ petition, since the present writ petition was preferred on December 6, 2023, that is, prior to the issuance of the fresh tender. 32. In such view of the matter, as a consequence of the setting aside of the refusal by the respondents to give the work order to the petitioner, all subsequent action taken by the State, including subsequent tender, if any issued, are hereby set aside. 33. The respondents shall issue work order to the petitioner by permitting the petitioner to incorporate the enhancement of 6% to the GST rates in its freshly quoted rates. Such fresh quotation shall be given by the petitioner to the respondent authorities within a week from date. Upon such rates being served on the respondent authorities, the respondent authorities shall issue the work order in terms thereof in favour of the petitioner pursuant to the tender-in-question. 34. Alternatively, the respondent will ..... X X X X Extracts X X X X X X X X Extracts X X X X
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