Badar Durrez Ahmed, J.

1. The petitioner is a manufacturer of polythene Insulated Jelly Filled (PIJF) Cables. These PIJF Cables are required by the respondent No. 1 Bharat Sanchar Nigam Limited (BSNL). For this purpose BSNL, issues tenders on an annual basis. Those who bid for the tenders are, if they are found to be qualified and eligible, allocated shares in the tender quantity depending on their vendor ratings. The vendor ratings in turn are calculated on the basis of a formula depending upon, inter alia, the price rating, delivery rating and quality rating. In this petition we are concerned primarily with the delivery rating and the resultant effect on the vendor rating.

2. The tender in question is the Tender No. NN/SW/032001/000220 which was issued on 27.3.2001 for the supply of PIJF Underground Cables. The notice inviting tender was also issued on 27.3.2001 wherein it was indicated that the tender quantity would be 441 LCKM and that the tenders would be opened on 22.5.2001 at 1200 hours. The petitioner as well as the respondent No. 4 NICCO Corporation Limited (NICCO), amongst others, bid for the tender quantity for supply of the said PIJF Cables. The petitioner as well as the respondent No. 4 were found to be qualified and eligible and accordingly were to be allocated their respective shares of the total tender quantity in terms of their respective vendor ratings. According to the petitioner the Delivery Rating of the respondent No. 4 (NICCO) was altered by the BSNL contrary to the terms of the tender and subsequent to the date of issue of the tender whereby the vendor rating of the petitioner was adversely affected. The petitioner who, if the change in the delivery rating of the respondent No. 4 was not made, would have been V-1 and, therefore, would have been eligible to supply 30% of the tender quantity, was relegated to the position of V-2 and accordingly the allocation of the petitioner was reduced. This, in short, is the grievance of the petitioner.

3. In this context the petitioner has prayed that a writ of certiorari be issued quashing the Advance Purchase Orders issued on 11.9.2001 by the BSNL to NICCO. The petitioner has also prayed for a writ of mandamus commanding the BSNL to issue fresh Advance Purchase Orders in terms of the Vendor Rating as on 22.5.2001, i.e. the date of opening of the tender, to the petitioner. The petitioner has also prayed for a writ of certiorari quashing the Revised Delivery Rating of the respondent No. 4 (NICCO) as set out in the Internal Office Memo dated 27.2.2001.

4. Thus, this petition is to be decided on the simple issue as to whether it was permissible for the BSNL, under the Tender Conditions, to alter the Delivery Rating of the tenderers after the date of opening of the tender, i.e. 22.5.2001 and, if so, to what extent In order to arrive at an answer, it would be necessary to refer to certain clauses of the Special Conditions of Contract pertaining to the tender in question. We need to note Clauses 13(i), 13(ii), Clauses 19, 19.3.8 and Clause 22(d). The aforesaid clauses are set out hereinbelow:

13(i). The purchaser intends to limit the number of bidders selected for ordering against this tender to 2/3rd of the participating and eligible bidders in each group (eligible as per Clause 2 of Section II of the Bid Documents). The bidders for placement of order will be selected from the list of technically and commercially responsive bidders arranged in decreasing order of the Vendor Rating starting from the highest. Any fraction below 0.5 in the number of vendors, as computed above shall be ignored and the same equal and above 0.5 will be rounded off to the next higher integer.

13(ii). The bidder with the highest Vendor Rating (V-I bidder) will be considered for about 30% of his tendered quantity. The balance quantity will be distributed amongst the remaining selected bidders in each group in direct ratio of their Vendor Rating.

19. All the vendors will be rated as per the following Vendor Rating formula.

VENDOR RATING (VR) = 0.6PR + 0.3DR + 0.1QR

Vendor PR = Price Rating.

DR = Delivery Rating

QR = Quality Rating.

19.3.8 If the delay is caused due to Departmental reasons as certified by Competent Authority or Force Majeure Conditions, it will not be taken into account in computing delays in supply.

22. Clarifications on VRS:

Xxxx xxxx xxxx xxxx

Xxxx xxxxxxxx xxxx

(d) Any modification obtained by supplier on his request made after the date of NIT which are in the nature of affecting the existing DR will not be taken into account.

Xxxx xxxx xxxx xxxx

5. Also of relevance is Clause 17 of the General (Commercial) Conditions of Contract pertaining to the tender in question:

17. FORCE MAJEURE

17.1 If, at any time, during the continuance of this contract, the performance in whole or in part by either party of any obligation under this contract is prevented or delayed by reasons of any war, or hostility, acts of the public enemy, civil commotion, sabotage, fires, floods, explosions, epidemics, quarantine restrictions, strikes, lockouts, or act of God (hereafter referred to as events) provided notice of happenings of any such eventuality is given by either party to the other within 21 days from the date of occurrence thereof, neither party shall by reason of such event be entitled to terminate this contract nor shall either party have any claim for damages against other in respect of such non-performance or delay in performance, and deliveries under the contract shall be resumed as soon as practicable after such an event comes to an end or ceases to exist, and the decision of the purchaser as to whether the deliveries have been so resumed or not shall be final and conclusive. Further that if the performance in whole or part of any obligation under this contract is prevented or delayed by reasons of any such event for a period exceeding 60 days, either party may, at its option, terminate the contract.

17.2 Provided, also that if the contract is terminated under this clause, the purchaser shall be at liberty to take over from the contractor at a price to be fixed by the purchaser, which shall be final, all unused, undamaged and acceptable materials, bought out components and stores (Illegible) which may be in possession of the contractor at the time of such termination or such portion thereof as the purchaser may deem fit, except such materials, bought out components and stores as the contractor may with the concurrence of the purchaser elect to retain.

6. At the time of opening of the tender i.e. on 22.5.2001, the Delivery Rating of the petitioner was 1 (one) and that of respondent No. 4 was 0.922183. While the petitioners Delivery Rating continued to remain 1 (one), the respondent No. 4s (NICCOs) Delivery Rating was altered subsequently (on 27.7.2001) to 0.940763. In other words, the respondent No. 4s Delivery Rating was increased and since all other things remained the same, relative to the petitioner, the Vendor Rating of the respondent No. 4 was altered to the detriment of the petitioner. This is clear from examining the formula for calculating the Vendor Rating as indicated above. Vendor Rating is a function of Price Rating, Delivery Rating and Quality Rating. If the Price Rating and the Quality Rating remain the same, a change in the Delivery Rating would have the consequential effect of changing the Vendor Rating. Thus, in such a situation, if the Delivery Rating is increased or decreased the Vendor Rating increases or decreases.

7. The Delivery Rating of the respondent No. 4 - NICCO was altered/modified on the basis of a representation dated 25.5.2001 submitted by NICCO. In the said representation dated 25.5.2001 it was indicated that as a result of massive floods, from 23.9.2000, extensive damage was caused to the equipments and as such there was an interruption in all production related activities of NICCO for a period of over three and a half months. Because of this, the respondent No. 4 (NICCO) requested BSNL to take action in recalculating their delivery schedule based on 90 days relaxation in delivery for orders listed in Annexure A and 60 days for orders listed in Annexure B to the said representation.

8. It is pertinent to note that on 6.6.2001 the Delivery Rating Review Committee met to review the representation received from different manufacturers (including the respondent No. 4-NICCO) after the opening of the tender on 22.5.2001. As regards NICCO the report of the said Delivery Rating Review Committee reveals as under:

M/s. Nicco Corporation represented that insufficient time is given under force majeure clause. Since the subject does not come under this committees purview the case may be forwarded to MM Cell, Sanchar Bhavan, New Delhi.

Ultimately, as recorded in the letter dated 27.7.2001, BSNL altered NICCOs delivery rating from 0.922183 (as was originally intimated on 21.5.2001) to 0.940763 after giving the benefit of force majeure condition to respondent No. 4 (NICCO).

9. In the counter affidavit filed on behalf of the BSNL, it is indicated that the Vendor Rating consisted of three components as is clear from the formula itself. It is further indicated in the counter affidavit at page 226 of the paper book as under:

The respondent No. 4 had better PR than petitioner. The Delivery Rating of the respondent No. 4 is however, lower than that of the petitioner. The petitioner has a Delivery Rating of one. Upon small correction of the respondent No. 4s Delivery Rating from.0.922118 (sic) to 0.940763, by virtue of the fact that the respondent No. 4 had better Price Rating, the respondent No. 4 becomes the Vendor with the rank one in the cable size 10/.5 mm (U/A). Accordingly 30% of this size has been allotted to the respondent No. 4. The petitioner being ranked at Vendor-2 also received orders for this size although lesser than the respondent No. 4.

The following table gives the relative Vendor Rating Position of the petitioner and respondent No. 4 before the modification in the Delivery Rating of the respondent No. 4 was made:

NameQRPRDRVRPosition as per

Vendor Rating

Petitioner10.94357010.966142V-1

NICCO (R-4)10.9752900.9221830.961829 V-3





10. It is the case of the petitioner that the alteration in the Delivery Rating by invoking the force majeure clause cannot at all be permitted in view of the Clause 22(d) of the Special Conditions of Contract particularly after the opening of the tender. If that be the case then the petitioner would be V-1 and would have been entitled to an allocation of 30% of the tender quantity. The total tender quantity for the cable size 10/.5 mm (U/A) was 19.61400 LCKM and if the petitioner was regarded as V-1 it would be entitled to 30% thereof, i.e. 5.37 LCKM. However, the petitioner was relegated to a lower position as a result of the modification in the Delivery Rating of the Respondent No. 4 which, after the modification became V-1 and was allocated 30% of the tender quantity. The petitioner, in fact, as a result of this modification, only got an allocation of 0.51492 LCKM. Thus, according to the petitioner, it was deprived of the allocation that it was entitled to under law. And, contends the petitioner, this was done in clear violation of the terms of the tender. This action is alleged to be arbitrary and discriminatory.

11. On the other hand, it was contended on behalf of the respondents that the force majeure clause had been invoked prior to the issuance of the NIT and the subsequent modification in the delivery rating was not relatable to any event subsequent to the issuance of the NIT or the opening of the tender. In the affidavit filed on behalf of the BSNL, it is indicated that respondent No. 4 (NICCO) had invoked the aforesaid force majeure Clause 19.1 on 23.9.2000 contained in the previous tender dated 4.2.2001 vide their letter dated 3.10.2000 within 21 days of the occurrence. It is further stated that BSNL studied the case of the respondent No. 4 (NICCO) and granted it extension of thirty days by their letters dated 1.12.2000 and 19.12.2000. Both the letters have been placed on record and indicate that the delivery period in respect of the previous tender had, in point of fact, been extended by thirty days.

12. The extension of the delivery period affects the delivery rating. An example would clarify the position. Let us assume that an order was placed on A for delivery of 1.00 LCKM by 31.3.2004. Let us further assume that during this period, the said A was only able to supply 0.50 LCKM. It is also assumed that the short-delivery was on account of force majeure and that the purchaser extended the period of supply by thirty days, i.e. upto 30.4.2004. In the extended period it is assumed that A supplies a further 0.25 LCKM. Now, if the original delivery period is taken, the delivery rating of A would be much lower than if he was permitted the benefit of the extended delivery. This is so because in the latter case, he would have the benefit of supplying a further 0.25 LCKM. Thus, it is clear that the extension of the delivery period has the effect of enabling a supplier to increase his delivery rating.

13. In the facts of the present case, it is apparent that much prior to the issuance of the NIT, the respondent No. 4 (NICCO) had been granted extension of thirty days under the force majeure clause. As a result of which, when the delivery rating of the respondent No. 4 was to be calculated, the benefit of the 30 days extension had to be given. As regards granting of benefit for the 30 days extension, the same is also not controverted by the petitioner. This would be apparent from paragraph 8(j) of the Rejoinder affidavit, which only reveals a grievance that a benefit of 45 days has been given when it ought to have been only limited to 30 days. The relevant part of Paragraph 8(j) reads as under:

(j)Furthermore while revising the Delivery Rating of respondent No. 4 from time-to-time, one of the Purchase Orders of respondent No. 4 was given the benefit of 45 days and this data was not corrected to 30 days in spite of the fact that the extension of only 30 days was granted under the Force Majeure clause by respondent Nos. 1, vide their letters dated 1.12.2000 and 19.12.2000.

It is further stated in sub-paragraphs (k) and (m) of the paragraph 8 of the rejoinder affidavit as under:

(k)It is important to mention herein that all other relevant Purchaser Orders of the respondent No. 4 were only considered for extension of 30 days whereas the Purchase Order No. 13-6/CABLE/2000-XP (NICCO) dated 4.9.2000, was given the extension of 45 days as against 30 days and the Delivery Rating was calculated accordingly.

(m) Thus, the petitioner states that if the Delivery Rating of respondent No. 4 is recalculated on the basis of 30 days extension and data correction in lieu of the 4 purchase orders as per para 3.2 as mentioned in letter dated 27.7.2001 of respondent No. 3 then the correct Delivery Rating would be 0.931621 as against 0.94760 (sic - should be 0.94763) as arrived by the respondent No. 3.

14.From the aforesaid it is clear that the force majeure clause which was invoked by the respondent No. 4 prior to the issuance of the notice inviting tender and the opening of the tender related only to extension of the delivery schedule by thirty days. However, the Advance Purchase Order has been placed on respondent No. 4 on the basis of delivery rating calculated on an extension of forty-five days which was not granted to respondent No. 4 prior to the issuance of the NIT. This would clearly be hit by the said Clause 22(d) which provides that any modifications obtained by a supplier on his request made after the date of NIT which are in the nature of affecting the existing DR will not be taken into account. It is clear that the modification of extending the period from 30 to 45 days was done after the date of the NIT. Such modification had the effect of altering the existing Delivery Rating. Clearly, this was not to be taken into account. Therefore, the action of the respondents and in particular BSNL in altering the Delivery Rating based upon a 45-day extension period was not at all permissible in law. However, it was permissible for them to arrive at the calculations of Delivery Rating based on the 30-day extended period, such extension having already been granted much prior to the issuance of the NIT. This, as indicated above, is also an admitted position as clarified in the rejoinder filed by the petitioner.

15. Thus, in the facts and circumstances of the case it does appear that the Delivery Rating of the respondent No. 4 ought to have been calculated only on the basis of the 30-day extended period and not on the basis of a 45-day extension. According to the petitioner, if that were done then the petitioner would have retained its position as V-1 and would have been entitled to 30% of the tender quantity. However, we are not going into these calculations which are required to be done by the respondents following the formulae laid down in the tender document and giving the benefit of the force majeure clause to the respondent No. 4 (NICCO) limited to the 30-day extension which was granted to the respondent No. 4 (NICCO) much prior to the issuance of the notice inviting tender. In this Courts order dated 9.10.2002 it is recorded that there are some supplies which are to be made for which no orders have been placed. On 16.12.2002 it is further recorded that Statement made by the Counsel for the respondents at the Bar that though the requirement is there but no order will be placed, will continue till the next date. Thereafter, this matter has been adjourned from time-to-time and has been finally heard by us. From these interim orders, it is clear that there are some supplies which remain to be made under the tender in question. Orders in respect thereof shall be placed after the respondents have recalculated the Delivery Rating of the respondent No. 4 (NICCO) as indicated above and consequently the relative Vendor Ratings of the petitioner and the respondent No. 4 (NICCO). If the petitioner is rated as V-1 then it shall be given the benefit in the balance supplies that are yet to be made. If after adjusting the balance amount the petitioner is still entitled to further supplies then it will be open to the petitioner to pursue its remedies against the respondents for compensation/damages that may be available to it in law.

16. To the aforesaid extent, the writ petition is allowed and is accordingly disposed of. The petitioners are entitled to costs which are quantified at Rs. 20,000/-.