A.J. DESAI, J.

1. Present writ petition under Articles 14, 19(1)(g), 21 and 226 of the Constitution of India came to be filed originally against present respondent Nos.1 and 2 challenging a decision dated 10.03.2022 of respondent No.2 by which the tenders / offered items by the petitioner came to be rejected on two grounds viz. (1) Annexure IV – Sr.no.14 – court matter pending against company (as per tender condition No.B(10) and (2) Firm has submitted false affidavit of Annexure-IV (as per tender condition no: F-4(l) and prayed in paragraph No.8(A), (B), (C), (D) and (E) as under:

“8(A) YOUR LORDSHIPS may be pleased to admit and allow this Petition;

(B) YOUR LORDSHIPS may be pleased to issue a Writ of Mandamus or a Writ in the nature of Mandamus, or any other appropriate writ, order or direction, quashing and setting aside the impugned decisions / order / Scrutiny Report of Respondent No.2 GMSCL dated 10.03.2022 in respect of Tender Notice No.GMSCL / D-21/2021-22 and Tender Enquiry No.GMSCL / D-684 / RC / 2021-22 (ON RATE CONTRACT BASIS) and direct the Respondents to consider the price-bid of the petitioners;

(C) YOUR LORDSHIPS may be pleased to issue a Writ of Mandamus declaring and holding that the following extract of Condition B(10) of the Tender Notice No.GMSCL / D-21 / 2021-2022 and Tender Enquiry No.GMSCL / D-684 / RC / 2021-22 (ON RATE CONTRACT BASIS) “....any criminal case is filed and pending in any Court in any state shall not be eligible to participate for that particular product, in the bid...” is arbitrary, illegal, bad in law, unreasonable and violative of the Fundamental Rights as guaranteed under Articles 14, 19(1)(g) and 21 of the Constitution of India and therefore, the same is non operative and not Binding to the petitioners;

(D) Pending hearing and final disposal of the Petition, YOUR LORDSHIPS may be pleased to stay the implementation, operation and execution of the impugned decisions / Scrutiny Report of Respondent No.2 GMSCL dated 10.03.2022 and Tender finalization including allotment of Contract in respect of Tender Notice No.GMSCL / D-21/2021-22 and Tender Enquiry No.GMSCL / D-684 / RC / 2021-22 (ON RATE CONTRACT BASIS) and further be pleased to direct Respondents to not to open the price-bid and / or direct Respondents not to allot the Tender;

(E) YOUR LORDSHIPS may be pleased to grant ex-parte ad interim relief in terms of Para 8(D);

The petitioner also prayed stay of the impugned decision dated 10.03.2022 by way of filing captioned civil application.

2. On 28.03.2022, following order was passed.

“1. Notice. Any steps taken by the respondents would be subject to final result of this petition.

2. Relist on 4.4.2022.”

2.1. Thereafter, the matter was listed for further hearing on 12.04.2022. Two applications being Civil Application No.1/2022 (For Amendment) and Civil Application No.3/2022 seeking amendment of pleadings as well as additional prayer, were filed which came to be allowed on that day. Accordingly, the amendment was carried out and following prayer came to be added in paragraph 8 as 8(BB).

“8(BB) YOUR LORDSHIPS may be pleased to issue a Writ of Mandamus or a Writ in the nature of Mandamus, or any other appropriate writ, order or direction declaring and holding that the impugned Corrigendum dated 30.09.2021 issued by Respondent No.2 under TE. No.- D-684 / RC / 2021-22 (ON RATE CONTRACT BASIS) is arbitrary, bad in law and issued without due process of law, and consequently to declare and hold the Amended Condition No.B(10) of Tender Enquiry No.GMSCL / D-684 / RC / 2021-22 (ON RATE CONTRACT BASIS) is Arbitrary, illegal, bad in law, unreasonable and violative of the Fundamental Rights as guaranteed under Articles 14, 19(1) (g) and 21 of the Constitution of India and therefore, the same is non operative and not Binding to the petitioners;”

2.2. An affidavit in reply on behalf of respondent No.2, who floated the tender came to be filed on 04.05.2022 alongwith necessary documents to which rejoinder was filed by the petitioner on 08.06.2022.

2.3. An application being Civil Application No.2/2022 which was filed by the petitioner for joining those respondent whose tender was accepted, came to be joined as respondent Nos.3 and 4, as per the order dated 14.06.2022. Respondent No.3 filed an affidavit in reply on 22.08.2022. An additional affidavit came to be filed by respondent No.3 on 06.09.2022. In response to the rejoinder filed by the original petitioner, respondent No.2 filed its sur-rejoinder on 06.09.2022. Additional affidavit came to be filed by the petitioner on 09.11.2022.

Thereafter, the petition came to be listed before the present Bench on 28.02.2023 and was listed for final hearing with the consent of learned Counsel appearing for the respective parties.

3. The case put forward by the petitioner prior to and after amendments in the petition is as under:

3.1. The petitioner is a private limited company registered under the Indian Companies Act, 1956. The company is engaged in business of manufacture and distribution of surgical dressing items as such as bandages, gauze etc. since its incorporation i.e. from the year 1989. Respondent No.2 – Gujarat Medical Services Corporation Limited (hereinafter referred to as “GMSCL”) is the procuring agency of Government of Gujarat, which is procuring the drugs and surgical items etc. from different manufacturers and distributors for the supply of same to the Government Hospitals throughout the State of Gujarat. GMSCL is the Government of Gujarat undertaking created by the State of Gujarat having monopoly in the State of Gujarat to procure and supply drugs and surgical items to the Government Hospitals throughout the State of Gujarat.

3.2. It is the case of the petitioner that a tender notice came to be issued by the GMSCL being Tender Notice No.GMSCL/D21/2021-22 inviting tenders for purchase of several items viz. (1) Black Disinfectant Fluid Grade III Liquid, (2) Absorbent Gauze With ISI Mark, (3) Bandage Cloth with ISI Mark and (4) Absorbent Cotton Wool (400 Gm). As per the tender notice, time of submission of technical bid and commercial bid through online was upto 18.00 Hours of 30.09.2021 whereas time was granted upto 18.00 hours of 01.10.2021 for physical submission of technical supporting documents inclusive of commercial documents. Due date and time of technical bid opening online was 15.00 hours on 04.10.2021. The petitioner submitted its online tender on 07.10.2021 as per the extended time to submit the tender.

3.3. The petitioner was served with the impugned order dated 10.03.2022 by which its tender was rejected on two grounds which have been referred to in the beginning of the present judgment. The petitioner filed the petition immediately on 11.03.2022 with unamended prayers referred to hereinabove mainly on the ground that the reasons for rejecting the tender was unlawful and illegal since similar issue has been finally decided by the Division Bench of this Court vide its oral judgment dated 10.02.2020 in writ petition being Special Civil Application No.23050/2019 which was filed by the present petitioner itself holding that rejection of the said tender of the petitioner with regard to eligibility criteria is not fulfilled is contrary to law and accordingly the petition came to be allowed.

3.4. It is further the case of the petitioner that the petitioner was not aware about the corrigendum dated 30.09.2021 issued by respondent No.2 by which condition No.(B) of eligibility criteria Clause No.10 came to be amended and therefore, the amended condition is also challenged on various grounds.

4. Mr. Mihir Joshi, learned Senior Advocate with learned advocate Mr. Saurin Mehta appearing for the petitioner vehemently submitted that the impugned order dated 10.03.2022 by which the tender submitted by the petitioner is rejected, is contrary to the facts and law. He would submit that when the tender notice was issued, as per the eligibility criteria described in Clause (B) and more particularly condition No.10 debars a firm and/or company or an individual whose product has been declared as of spurious or adulterated quality and any criminal case is filed and pending in any Court in any State shall not be eligible to participate for that particular product in the bid. Similarly, convicted firm / company shall also not be eligible to participate in the bid. Relying upon the said clause, the tender came to be rejected by respondent No.2 in the year 2019 came to be challenged by the present petitioner by way of filing Special Civil Application No.23050/2019. Interpreting the said condition, it has been held by the Division Bench of this Court that a firm / company would not be entitled to bid if it has been declared that particular product is of spurious or adulterated quality and any criminal case has been filed and is pending in the Court. He would submit that it has been further held that before employing the condition No.B(10) both conditions are required to be satisfied which is not the case against the petitioner when the tender notice was issued.

4.1. Mr. Joshi, learned Senior Advocate would further submit that the corrigendum issued on 30.09.2021, the respondent deliberately amended the condition No.B(10) by subsequently adding a word “or”, so as to debar the present petitioner from submitting the bid since criminal cases are pending in the Court of Chief Judicial Magistrate, Virudhunagar, District Srivilliputtur, State of Tamilnadu. He would submit that the condition has already been interpreted by the Division Bench of this Court and has become final, therefore there was no reason to issue corrigendum altering / amending the condition No.B(10) which has been deliberately amended only at the instance of respondent No.3 in whose favor the tender has been granted.

4.2. He would further submit that the condition has been amended without following due process i.e. approval by the competent officers of respondent No.2.

4.3. Mr. Joshi, learned Counsel emphatically submitted that it cannot be said that there was a grammatical mistake in unamended condition No.B(10) however, under the pretext of the same, corrigendum has been issued adding word “or” instead of only “and”, which was mandatory being twin condition as per the decision of this Court dated 10.02.2020 passed by the Division Bench of this Court in Special Civil Application No.23050/2019. He contended that only at the behest of respondent No.3, aforesaid condition has been modified to debar the petitioner in taking part in bidding process and therefore, said action is malafide and therefore, such condition is required to be quashed and set aside.

4.4. Mr. Joshi, learned Counsel would further submit that before amending condition No.B(10), the authority should have examined the prices offered by the present petitioner and respondent No.3. He would submit that in the decision of amending the said condition, the respondent would be at loss to the exchequer to the tune of Rs.7.53 Crores. He would further submit that the decision has been taken in haste by the authority when the notice was issued by this Court on 01.08.2022.

4.5. Mr. Joshi, learned Counsel would further submit that condition No.B(10) is violative of Articles 14, 19(1)(g) and 21 of the Constitution of India since it is unreasonable and unjust restriction upon the business which is carried out by the bidder. He would submit that the same is against the public policy in view of the pendency of litigation before this Court. He would submit that only pendency of criminal case which debars a person from submitting his offer in response to tender notice is violative of Article 21 of the Constitution of India since the petitioner is not held guilty by any Court and therefore, it is presumed that they are innocent.

Condition No.B(10) is also unreasonable, harsh and arbitrary on the ground that it restricts permanently any bidder to participate in the tender till the criminal proceeding is not decided whereas condition No.B(8) makes the bidder eligible in the case of blacklisting period and where not specified after two years.

4.6. Mr. Joshi, learned Counsel would further submit that as far as second reason for rejecting the bid is with regard to alleged filing of false affidavit by the petitioner is to be quashed and set aside since the cases which were pending in the criminal court were given new numbers. He would submit that the petitioner has stated the original numbers given to the criminal complaint initially however, subsequently they were re-numbered, which was subsequent clarified and the same were disclosed by the petitioner to the authority. He would submit that no opportunity of hearing was given to the petitioner before coming to the conclusion that a false affidavit came to be filed by the petitioner alongwith the bid.

4.7. Learned Counsel Mr. Joshi would submit that the contract granted in favor of respondent No.3 is illegal in view of the fact that respondent No.3 is the sole beneficiary of amended condition which can be termed as tailor made. He would further submit that even as per Condition No.F(4)(l) read with Condition No.F(9)(iii) read with Annexure-III of Higher Price / Lower Price Certificate, respondent No.3 has also misled the Authority and on that ground also, the contract granted in favor of respondent No.3 is required to be quashed and set aside.

He would further submit that subsequent inquiry carried out for the same would not entitle respondent No.3 to continue with the contract since such inquiry should have been carried out at the threshold. He would submit that the decision granting contract in favor of respondent No.3 is a hasty decision, which was taken by the Managing Director, which has resulted into loss to the exchequer to the tune of Rs.7.53 Crores. He, therefore, would submit that the contract granted in favor of respondent No.3 be quashed and set aside.

4.8. By relying upon a decision of the Hon’ble Apex Court in the case of Tejas Construction and Infrastructure Private Limited vs. Municipal Council, Sendhawa and Anr. reported in (2012) 6 SCC 464, Mr. Joshi, learned Counsel would submit that if a mistake is committed by the bidder and subsequently clarified, on the said ground, the bid cannot be rejected. He would submit that in the said case, the audit report with regard to particular year which was not completed at the time of offering the bid was submitted and therefore, rejection of bid was challenged before the High Court and the said decision of the authority was quashed and set aside on the ground that subsequently the correction has been made. The said decision was upheld by the Hon’ble Apex Court in the said decision. In the present case also, the present petitioner has clarified the new and correct numbers of the criminal cases.

4.9. By relying upon the decision of Hon’ble Apex Court in the case of Tata Cellular vs. Union of India reported in (1994) 6 SCC 651, Mr. Joshi would submit that the decision of respondent Authority of rejecting the contract was pendency of CBI inquiry was quashed and set aside by the High Court which was upheld by the Hon’ble Apex Court.

4.10. By relying upon another decision of Hon’ble Apex Court in the case of BSN Joshi & Sons Ltd. vs. Nair Coal Services Ltd. And Others reported in (2006) 11 SCC 548, the Hon’ble Apex Court has dealt with expression “declaration” and has held that it has a definite connotation. It may constitute a formal announcement or a deliberate statement. The expression “declared” is wider than the word “found” or “made”. He would submit that it has been held that declared defaulter should be an actual defaulter and not an alleged defaulter. Like in the present case, the petitioner is not convicted but is an alleged accused and therefore also, the impugned condition is required to be held contrary to Articles 14, 19(1)(g) and 21 of the Constitution of India.

4.11. By relying upon a judgment dated 24.04.2017 delivered by the Division Bench of this Court in the case of Centre for Development Communication vs. AMC rendered in Special Civil Application No.4748/2017, learned Counsel Mr. Joshi would submit that one of the condition of disqualification of pendency of criminal proceeding is held to be harsh in nature and accordingly, the said condition is unjust, illegal, arbitrary and violative of Articles 14, 19(1)(g) and 21 of the Constitution of India.

4.12. By relying upon another decision of the Hon’ble Apex Court in the case of ICOMM Tele Limited vs. Punjab State Water Supply and Sewerage Board and Another reported in (2019) 4 SCC 401, learned Counsel Mr. Joshi would submit that the Hon’ble Apex Court having found the disqualification clause an arbitrary one, the same was quashed and set aside.

4.13. By relying upon another decision of Hon’ble Apex Court in the case of Daffodills Pharmaceuticals Limited & Anr. vs. State of Uttar Pradesh & Anr. reported in (2020) 18 SCC 550, learned Counsel Mr. Joshi would submit that a condition of disqualification to offer the bid in the similar nature has been held more harsh than a condition of blacklisting a person from taking part in the process of tender and therefore, would submit that present condition is required to be quashed and set aside.

4.14. By relying upon another decision of Hon’ble Apex Court in the case of Balmer Lawrie & Company Limited & Ors. vs. Partha Sarathi Sen Roy & Others reported in (2013) 8 SCC 345, learned Counsel Mr. Joshi would submit that if the clause is unfair and irrational, the Court has ample power to quash and set aside such clause which is contrary to the tender notice.

4.15. By relying upon decision dated 20.08.2009 of the Division Bench of High Court of Judicature at Mumbai in Writ Petition (Lodging) No.1243 of 2009 along with Writ Petition No.765 of 2009 in the case of Ashwin S. Shah & Others vs. Municipal Corporation of Greater Bombay, learned Counsel Mr. Joshi would submit that challenging the rules in the midst of tender process is unfair and unjust and can be interfered by the Court.

4.16. By taking us through the dictionary meaning as per the Black’s Law Dictionary, the word “Corrigendum” is defined as “an error in a printed work discovered after the work has gone to press” and therefore, would submit that adding a word “or” cannot be said to be a printing mistake while tender notice was issued.

4.17. Considering the above various decisions, learned Counsel Mr. Joshi would submit that both the reasons assigned by the authorities are contrary to law and unjust and are required to be held illegal, ultra vires to Articles 14, 19(1)(g) of the Constitution and require to be quashed and set aside and accordingly, the contract granted in favor of respondent No.3 is also required to be quashed and set aside.

5. On the other hand, learned advocate Mr. Mitul Shelat with learned advocate Ms. Disha Nanavaty appearing for respondent No.2 – Authority has vehemently opposed the present petition. He would submit that the petitioner was fully aware about the tender notice which was initially issued at the instance of respondent No.2, which was extended upto 07.10.2021. The Corrigendum was published online on 30.09.2021, on the website of a company through which the tenders were invited. He would submit that it is an undisputed fact that the petitioner has submitted its tender on 07.10.2021 i.e. the extended last date for submission of the bid.

5.1. By taking us through a document published on the website of Procure Tender Management System which was hired by respondent No.2 for tender process would submit that the corrigendum in terms of condition came to be published on 30.09.2021 on 17.42 Hours and last date of submitting the bid was extended to 07.10.2021. Accordingly, the petitioner has submitted his bid on 07.10.2021. He would submit that the petitioner did not disclose the same initially at the time of filing of the petition. The corrigendum which was published on the website on 30.09.2021 by which condition No.B(10) was modified was never produced alongwith the petition and by relying upon a decision of the Division Bench of this Court in Special Civil Application No.23050/2019 dealing with the unamended condition, the petitioner was successful in getting orders and notice to the present respondent. He would submit that only after appearance by the respondent before this Court, amendments were made and corrigendum was produced and prayer clause were accordingly added. He would submit that only on this ground, the petition is required to be dismissed i.e. on the ground of suppression of most important and material fact which goes to the root of the case on hand.

5.2. Learned Counsel Mr. Shelat would submit that the documents produced by the petitioner alongwith petition at Annexures G to I, the say of the petitioner with regard to the pendency of cases, he has reiterated only the fact that the petitioner has committed the offence as its product has been declared as spurious or adulterated. Only narrating the fact that the cases are pending with no correct details regarding the case numbers would amount to breach of Condition No.F(4)(l) read with Condition No.F(9)(iii). Apart from this factual aspect, he would submit that it has been held by catena of decisions of the Hon’ble Apex Court that the judicial interference can be made only in the principles like the condition imposed is arbitrary and unreasonable. Aggrieved person is supposed to establish that the tender process undertaken by the Authority is malicious and a misuse of statutory powers. He would further submit that if it is found by the Court that the Authorities have undertaken the tendering process fairly and in the public interest and ultimately awarded the contract, interference by the Court would be very restrictive in nature and no person can claim a fundamental right to carry on business with the government. In support of the said submission, learned Counsel Mr. Shelat has relied upon a decision of the Hon’ble Apex Court in the case of Michigan Rubber (India) Limited vs. State of Karnataka and Others reported in (2012)8 SCC 216.

As far as giving of false information is concerned, learned Counsel Mr. Shelat would submit that it is not in dispute that incorrect information was supplied by the petitioner on affidavit which can be treated as false affidavit and in such circumstances the Authority has rightly rejected the bid of the petitioner. In support of the said submission, learned Counsel Mr. Shelat has relied upon a decision of Hon’ble Apex Court in the case of Central Coalfields Limited and Another vs. SLL-SML (Joint Venture Consortium) and Others reported in (2016)8 SCC 622.

5.3. He would further submit that the allegation leveled by the petitioner that the decision has been taken by only the Managing Director and accordingly, corrigendum was issued, cannot be accepted in view of the fact that the Authority in consultation of the officers of respondent No.2 decided to amend the condition No.B(10) after getting opinion from the Law Officer of respondent No.2 itself. He would further submit that the petitioner has miserably failed to establish that there was any malafide on the part of respondent No.2 to amend the condition with a purpose to oust the petitioner only.

5.4. He would submit that the petitioner has participated in the tender proceeding and was fully aware about the corrigendum though the petitioner might have pleaded ignorance which cannot be believed in view of the fact that the petitioner has submitted its bid on 07.10.2021 i.e. on the extended last date and subsequent to the publication of the corrigendum.

By relying upon a decision of the Hon’ble Apex Court in the case of Union of India and Others vs. C. Girija and Others reported in (2019) 15 SCC 633, he would submit that the Hon’ble Apex Court has held that the Court should not interfere with such representation or objections raised at belated stage.

5.5. By relying upon a decision dated 20.06.2018 of the Division Bench of this Court rendered in Special Civil Application No.8095/2018, learned Counsel Mr. Shelat would submit that the Division Bench has held that dealing with tender conditions, the Court should be slow unless the same is found unreasonable or malicious.

5.6. By relying upon another decision dated 17.10.2018 of the Division Bench of this Court in the case of Labh Decor vs. Gujarat University rendered in Special Civil Application No.10009/2017, learned Counsel Mr. Shelat would submit that in similar type of facts i.e. issuance of corrigendum and modifying the condition were upheld by the Division Bench since the petitioner in that case miserably failed to establish any malice on the part of the Authority.

5.7. As far as the allegation with regard to granting contract in favour of respondent No.3 is concerned, learned Counsel Mr. Shelat would submit that the commercial bid of respondent No.3 was opened on 24.03.2022 and 8 committee members including the Chairman, who is Additional Chief Secretary, Health and Family Welfare Department, State of Gujarat and Managing Director of respondent No.2 had examined the case and negotiated with respondent No.3 and the rates were reduced and the same was accepted and therefore, it cannot be said that only the Managing Director had taken decision to grant contract in favour of respondent No.3.

5.8. By relying upon decision of Hon’ble Apex Court in the case of W.B. State Electricity Board vs. Patel Engineering Co. Ltd. And Others reported in (2001) 2 SCC 451, learned Counsel Mr. Shelat would submit that it has been held in that case that if the mistake committed by the party is unintentional, the party cannot take benefit of the same. The party should be vigilant while participating in the tender process and submit the reports asked for by the Authority.

5.9. Learned Counsel Mr. Shelat would further submit that it is undisputed fact that criminal cases are pending against the petitioner and other accused have pleaded guilty and have been convicted. Due to non-cooperation on the part of the present petitioner, criminal cases are not proceeded with qua the petitioner and the petitioner cannot claim that pendency would take years together and petitioner would be debarred permanently from participating in the tender process and on that ground also, the petitioner cannot claim any equity in its favour. He, therefore, would submit that the petition be dismissed.

6. Learned Senior Advocate Mr. Sudhir I. Nanavati with learned advocate Mr. Gunvant Thakar appearing for respondent No.3, in whose favour, contract has been granted has adopted the arguments advanced by learned Counsel Mr. Shelat appearing for respondent No.2. Learned Counsel Mr. Nanavati would submit that the cases are pending against the petitioner since 2014 and could have got it decided. By taking us through a decision dated 17.02.2016 of the learned Chief Judicial Magistrate, Virudhunagar, District Srivilliputtur, State of Tamilnadu, he would submit that the present petitioner is accused No.11. Against the petitioner, the case is yet pending and others have been convicted and fined by the concerned learned Chief Judicial Magistrate.

6.1. Learned Counsel Mr. Nanavati by taking us through the affidavit filed by respondent No.3 would further submit that he is trying to establish that he has offered lower price with regard to certain items than initial offer and therefore, the Authority has rightly accepted the tender submitted by respondent No.3. He would submit that even the proceedings were initiated against the petitioner for producing fabricated report of Central Drugs Laboratory, Calcutta in the year 2012 for which a petition was filed at the instance of respondent No.3, which was allowed however, the said order was challenged by the present petitioner before the Division Bench of this Court by way of filing Letters Patent Appeal No.342/2020 and adverse observations have been made against the present petitioner about its conduct. He, therefore, would submit that the petition is required to be rejected considering the overall conduct of the petitioner.

7. We have heard learned Counsel appearing for the respective parties.

It is an undisputed fact that respondent No.2 published a tender notice on website through one agency viz. Procure Tender Management System wherein Condition No.B(10) was published, which reads as under:

“ B. ELIGIBILITY CRITERIA:

10. The concern / firm / company whose product has been declared as of spurious / adulterated quality and any criminal case is filed and pending in any court in any state shall not be eligible to participate for that particular product, in the Bid. Similarly convicted firm / company shall also not be eligible to participate in the Bid.”

As per the said tender notice, the date and time of submission of technical bid and commercial bid online was 18.00 hours on 30.09.2021 whereas physical submission of technical supporting documents inclusive of documents was upto 01.10.2021. The said agency viz. Procure Tender Management System issued amended Condition No.B(10) which reads as under:

“General Tender Condition : B. Eligibility Criteria in No.10:

The concern / firm / company whose Quoted product has been declared as of spurious / adulterated quality and or any criminal case is filed and pending in any court in any state/Union Territory shall not be eligible to participate for that particular product, in the Bid. Similarly convicted firm / company shall also not be eligible to participate in the Bid."

The said corrigendum was created on 30.09.2021 at 17.41.04 Hours and it was also published that last date and time for submission of bid would be 18.00 hours on 07.10.2021.

7.1. It is undisputed fact that the petitioner has not submitted its bid on 30.09.2021 but the petitioner submitted the tender only on the last date i.e. 07.10.2021 and if we see the publication by the company, which is produced by respondent No.2 alongwith affidavit, that both the items have been mentioned i.e. corrigendum in terms of conditions of the original tender notice and date of extension and therefore, it is presumed that the petitioner was aware about the last date of submission of bid as well as with regard to reference of corrigendum and therefore, in our opinion it is also presumed that petitioner was fully aware about the amended condition No.B(10) by which the authority has clarified that not only the petitioner is convicted and case is pending but even if the case is pending against a party, such party would not be eligible for participating in bid process. If the petitioner was so aggrieved with the amended condition No.B(10) which was issued on website on 30.09.2021, the petitioner could have brought it to the notice of the Authority or could have raised objection about the amended condition or could have challenged the same before appropriate Forum on the grounds which now have been raised that too after participating in the tender process.

It is an undisputed fact that the petitioner did not disclose about the corrigendum at the time of filing of the petition and only subsequent to appearance by respondent No.2, the petition came to be amended and the corrigendum was produced and accordingly the prayers have been made. When the Court had issued notice solely relying upon the memo of petition wherein no corrigendum was produced and heavy reliance was made upon a decision dated 10.02.2020 of this Court rendered in Special Civil Application No.23050/2019, the Court issued notice to respondent Nos.1 and 2, who were parties initially at the time of filing of the petition however, it is also to be noted that no stay came to be granted against the completion of bid process and therefore, this aspect also creates doubt about the intention of the petitioner who is alleging malafide against respondent No.2. However, when the petitioner is permitted to amend the petition, the Court is supposed to deal with the contentions raised by the petitioner with regard to challenge to amended Condition No.B(10) as well as grant of tender in favour of respondent No.3.

7.2. The first reason for rejecting the tender of petitioner, which was submitted by the petitioner, by order dated 10.03.2022, reads as under:

“Annexure IV – Sr.no.14 – court matter pending against company (as per tender condition No.B(10)”

As can be seen from the first reason reproduced hereinabove, respondent No.2 added word “or” alongwith “and/” and therefore, whether the modification can be treated as malafide or unreasonable is required to be examined.

It is true that the Division Bench of this Court in its decision dated 10.02.2020 rendered in Special Civil Application No.23050/2019 dealt with unamended condition which was issued in that petition and therefore, has held that both the conditions viz. he should have been convicted and cases are pending, are required to be applied and only in those twin conditions, if satisfied, a person can be held ineligible to participate in the bid process. But the same would not be applicable in the present case since the condition is modified. The modified condition which adds word “or” cannot be held harsh in nature as submitted by the learned Counsel appearing for the petitioner in view of the fact that respondent No.2 – Corporation is dealing with medical services through the government hospitals within the State of Gujarat by procuring various types of medicines and other necessary items which deal with the health of those persons who are availing the medical services through government hospital which they are getting free of cost. If a company or an individual is charged with various offences relating to Drugs and Cosmetics Act and criminal cases are pending, in our opinion, it cannot be said that Authority has deliberately modified the condition.

7.3. Even in the year 2019, it was the case of the Corporation to interpret the word “and” which would include word “and/or” however, the same was not accepted by the Division Bench of this Court and it was held that twin conditions are required to be complied with and therefore, having considered the said aspect, the corrigendum was issued and condition was modified though it might have been brought to the notice of the Corporation by respondent No.3, it cannot be said that modified Condition No.B(10) is arbitrary one and therefore, judgment of Hon’ble Apex Court relied upon by the learned Counsel appearing for the petitioner in the case of ICOMM Tele Limited (Supra) would not be applicable.

The Court is supposed to examine certain aspects laid down by the Hon’ble Apex Court in the case of Michigan Rubber (India) Limited (Supra). By relying upon various decisions of the Hon’ble Apex Court, it has been held in paragraphs 23 and 24 that unless it is found that the Authority is acting unreasonably, only in such circumstances the judicial interference is required. Paragraphs 23 and 24 of the said decision read as follows:

“23. From the above decisions, the following principles emerge:

(a) The basic requirement of Article 14 is fairness in action by the State, and non-arbitrariness in essence and substance is the heartbeat of fair play. These actions are amenable to the judicial review only to the extent that the State must act validly for a discernible reason and not whimsically for any ulterior purpose. If the State acts within the bounds of reasonableness, it would be legitimate to take into consideration the national priorities;

(b) Fixation of a value of the tender is entirely within the purview of the executive and courts hardly have any role to play in this process except for striking down such action of the executive as is proved to be arbitrary or unreasonable. If the Government acts in conformity with certain healthy standards and norms such as awarding of contracts by inviting tenders, in those circumstances, the interference by Courts is very limited;

(c) In the matter of formulating conditions of a tender document and awarding a contract, greater latitude is required to be conceded to the State authorities unless the action of tendering authority is found to be malicious and a misuse of its statutory powers, interference by Courts is not warranted:

(d) Certain preconditions or qualifications for tenders have to be laid down to ensure that the contractor has the capacity and the resources to successfully execute the work; and

(e) If the State or its instrumentalities act reasonably, fairly and in public interest in awarding contract, here again, interference by Court is very restrictive since no person can claim fundamental right to carry on business with the Government.

24. Therefore, a Court before interfering in tender or contractual matters, in exercise of power of judicial review, should pose to itself the following questions:

(i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone; or whether the process adopted or decision made is so arbitrary and irrational that the court can say: “the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached” and

(ii) Whether the public interest is affected

If the answers to the above questions are in negative, then there should be no interference under Article 226.”

Similar is the ratio laid down by the Division Bench of this Court in its decision dated 20.06.2018 rendered in the case of M/s. Shelat Brothers vs. State of Gujarat [Special Civil Application Nos.8095/2018 and 8826/2018] and the decision dated 17.10.2018 rendered in the case of Labh Decor vs. Gujarat University [Special Civil Application No.10009/2017].

7.4. The judgment of Hon’ble Apex Court in the case of Daffodills Pharmaceuticals Limited & Anr. (Supra) relied upon by learned Counsel appearing for the petitioner treating the modified condition as harsh than the condition of blacklisting a person from taking part in the process of tender would not be applicable to the present case in view of the fact that the petitioner is facing criminal prosecution in the Court of learned Chief Judicial Magistrate, Virudhunagar, District Srivilliputtur, State of Tamilnadu.

7.5. Insofar as the judgment of the Division Bench of this Court in the case of Centre for Development Communication (Supra) relied upon by the learned Counsel appearing for the petitioner is concerned, in the said case, the tender was issued by Regional Transport Officer with regard to grant of contract for vehicles to carry out certain work and considering the subject matter of the present case which involves health of public at large, we are of the considered opinion that the same would not also be directly applicable to the case on hand.

7.6. As far as the submission made by the learned Counsel Mr. Joshi appearing for the petitioner with regard to price offered by respondent No.3 and accepted by respondent No.2 is on higher side and was decided without following procedure is concerned, the same cannot be accepted in view of the specific affidavit filed by respondent No.2 wherein it is declared that a Board Level Committee consisting of 8 members including the Additional Chief Secretary, Health and Family Welfare Department, State of Gujarat and Managing Director of respondent No.2 have considered the case of the petitioner which was opened on 24.03.2022. Following were the eight members of the Board Level Committee, who have come to the conclusion of granting contract in favor of respondent No.3:

7.7. As far as second reason for rejecting the tender of the petitioner is concerned, we would like to reproduce the relevant condition, which reads as under:

“F. OPENING OF TECHNICAL AND COMMERCIAL BID.

4. The tender is liable for rejection due to any of the reasons mentioned below:

(l) Submission of misleading / contradictory / false statement or information and fabricated / invalid documents.”

Now, if we see the detail submitted by the petitioner alongwith the tender, the petitioner had declared that no criminal case is pending against the petitioner. But the number of the cases provided were not correct. When the same was informed after getting the details, it was submitted that the petitioner was not aware about the new number. This submission cannot be accepted in view of the fact that when respondent No.2 was aware about the details of pendency of cases against the petitioner, it cannot be believed that the petitioner was not aware about the same. It is expected that when a bidder is submitting his tender, he is required to be very vigilant and submit the correct case numbers. Hence, the decision of Hon’ble Apex Court in the case of W.B. State Electricity Board (Supra) relied upon by the learned Counsel appearing for respondent No.2 would be applicable to the present case. Paragraph 23 of the said decision reads as under:

“23. The mistakes/errors in question, it is stated, are unintentional and occurred due to the fault of computer termed as “a repetitive systematic computer typographical transmission failure”. It is difficult to accept this contention. A mistake may be unilateral or mutual but it is always unintentional. If it is intentional it ceases to be a mistake. Here the mistakes may be unintentional but it was not beyond the control of Respondents 1 to 4 to correct the same before submission of the bid. Had they been vigilant in checking the bid documents before their submission, the mistakes would have been avoided. Further, correction of such mistakes after one-and-a-half months of opening of the bids will also be violative of Clauses 24.1, 24.3 and 29.1 of ITB.”

Similar is the ratio laid down by the Hon’ble Apex Court in the case of Central Coalfields Limited and Another (Supra), wherein in paragraphs 30, 34, 36, 47 and 47, the Hon’ble Apex Court held as follows:

“30. In this context and thirdly, it is important to note that if JVC had any doubt with regard to the format of the bank guarantee to be furnished, it could have and ought to have sought a clarification from the concerned authority as mentioned in NIT. Moreover, JVC could have and ought to have at least made a representation to CCL that the prescribed format for the bank guarantee was either not available or that NIT was ambiguous or that it lacked clarity with regard to the prescribed format of the bank guarantee. JVC neither sought any clarification nor did it make any representation to CCL. It is difficult to understand the conduct of JVC in the situation presented before us, particularly with reference to a contract for about Rs. 2000 crores for eight years.

34. In Ramana Dayaram Shetty case5 , the expression “registered IInd Class hotelier” was recognized as being inapt and perhaps ungrammatical; nevertheless common sense was not offended in describing a person running a registered IInd grade hotel as a registered IInd Class hotelier. Despite this construction in its favour, Respondent 4 in that case were held to be factually ineligible to participate in the bidding process.

36. Applying this principle to the present appeals, other bidders and those who had not bid could very well contend that if they had known that the prescribed format of the bank guarantee was not mandatory or that some other term(s) of NIT or GTC were not mandatory for compliance, they too would have meaningfully participated in the bidding process. In other words, by rearranging the goalposts, they were denied the “privilege” of participation.

43. Continuing in the vein of accepting the inherent authority of an employer to deviate from the terms and conditions of an NIT, and reintroducing the privilege-ofparticipation principle and the level playing field concept, this Court laid emphasis on the decision-making process, particularly in respect of a commercial contract. One of the more significant cases on the subject is the threejudge decision in Tata Cellular v. Union of India8 which gave importance to the lawfulness of a decision and not its soundness. If an administrative decision, such as a deviation in the terms of NIT is not arbitrary, irrational, unreasonable, mala fide or biased, the courts will not judicially review the decision taken. Similarly, the Courts will not countenance interference with the decision at the behest of an unsuccessful bidder in respect of a technical or procedural violation. This was quite clearly stated by this Court (following Tata Cellular8 ) in Jagdish Mandal v. State of Orissa7 in the following words: (SCC p. 531, para 22).

“22. Judicial review of administrative action is intended to prevent arbitrariness, irrationality, unreasonableness, bias and mala fides. Its purpose is to check whether choice or decision is made “lawfully” and not to check whether choice or decision is “sound”. When the power of judicial review is invoked in matters relating to tenders or award of contracts, certain special features should be borne in mind. A contract is a commercial transaction. Evaluating tenders and awarding contracts are essentially commercial functions. Principles of equity and natural justice stay at a distance. If the decision relating to award of contract is bona fide and is in public interest, courts will not, in exercise of power of judicial review, interfere even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. The power of judicial review will not be permitted to be invoked to protect private interest at the cost of public interest, or to decide contractual disputes. The tenderer or contractor with a grievance can always seek damages in a civil court. Attempts by unsuccessful tenderers with imaginary grievances, wounded pride and business rivalry, to make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade courts to interfere by exercising power of judicial review, should be resisted. Such interferences, either interim or final, may hold up public works for years, or delay relief and succour to thousands and millions and may increase the project cost manifold.”

This Court then laid down the questions that ought to be asked in such a situation. It was said: (Jagdish Mandal case9 , SCC p. 531, para 22).

“22. ... Therefore, a court before interfering in tender or contractual matters in exercise of power of judicial review, should pose to itself the following questions:

(i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone;

OR

Whether the process adopted or decision made is so arbitrary and irrational that the court can say: “the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached”;

(ii) Whether public interest is affected. If the answers are in the negative, there should be no interference under Article 226.”

47. The result of this discussion is that the issue of the acceptance or rejection of a bid or a bidder should be looked at not only from the point of view of the unsuccessful party but also from the point of view of the employer. As held in Ramana Dayaram Shetty5 the terms of NIT cannot be ignored as being redundant or superfluous. They must be given a meaning and the necessary significance. As pointed out in Tata Cellular8 there must be judicial restraint in interfering with administrative action. Ordinarily, the soundness of the decision taken by the employer ought not to be questioned but the decision-making process can certainly be subject to judicial review. The soundness of the decision may be questioned if it is irrational or mala fide or intended to favour someone or a decision “that no responsible authority acting reasonably and in accordance with relevant law could have reached” as held in Jagdish Mandal9 followed in Michigan Rubber13.”

8. In view of the aforesaid discussion as also the law laid down by the Hon’ble Apex Court in various decisions, we do not find any merit in the present petition and hence, the present petition is dismissed. Notice is hereby discharged.

9. In view of dismissal of petition, Civil Application (For Stay) also stands dismissed.