D.P. Wadhwa, J.

1. The first petitioner, a public limited company, and second petitioner, its shareholder, have filed this petition challenging the action of the respondents 1 and 3, rather of the first respondent, in awarding the contract for the construction of cooling tower and cooling water treatment plant of the first respondent to the second respondent. The contract was awarded after notice inviting tender (NIT) had been issued and evaluation of different bids, first of technical and then of financial, done. First petitioner claims to be engaged in the business of manufacturing, erecting, and commissioning of cooling towers and cooling water treatment plants.

2. The respondents number five. First respondent Bangaigaon Refinery and Petrochemicals Limited (BRPL) which required the construction of works in question is a public sector company; the second respondent Bridge and Roof Company (India) Limited (B and R) to whom the contract was awarded is also a public sector company; so is the third respondent Engineers India Limited (EIL) who acted as a consultant of the first respondent and acted for and on its behalf for issuing NIT and then processing the bids and making the recommendation to award the contract to the B and R, the second respondent; fourth respondent is the Senior Manager (Contracts) of EIL and the fifth is the Union of India through the Secretary, Ministry of Petroleum. For the purpose of decision of this petition the respondents would be first, second and third, i.e., BRPL, B and R and EIL.

3. Since a great deal of arguments have been addressed on the interpretation of NIT we may as well reproduce the same, in relevant parts:

(i) Name of work Design, Supply, Erection, Testing, and Commis­sioning of Cooling Tower and Cooling Water Treatment Plant pack­age.

(ii) The tenderers who intend to participate shall meet the following minimum reqirements and only such tenderers shall be considered for pre-qualification for the tender. The tenderers who are not meeting the following requirements, NEED NOT PURCHASE the tender document.

(1) The tenderer should possess experience in successful execution on turnkey basis of at least one Cooling Tower and Cooling Water Treatment Plant of value not less than Rs. 80.00 lakh (Rupees Eighty lakh only) during last 5 (five) years including detail Engineering, Supply, Erection, Installation, Testing and Commis­sioning.

(2) The Annual Turnover of the tenderers shall be more than Rs. 160 lacs in any one of the last three years (financial year 1989-90,1990-91,1991-92).

The intending tenderers as a pre-requisite must produce documentary evidence of aforesaid account and shall submit copies of Letter of Intent of works awarded, Completion Certificates, Latest Income Tax Clearance Certificates, Concurrent Commitments. Audited Balance Sheets and Profit and Loss Account Statements for last 3 years along with Techno-commercial part (i.e. Part-I) of their offer, as mentioned in the Tender Document. Submission of tenders shall be done by the Tenderers as per instructions contained in the Special Conditions of Contract of the Tender Document.

Part-I and II of tender,i.e. TECHNO-COMMERCIAL (Part-I) and ‘Priced part containing only Price/Rates (Part-II) in separate envelope will be received on or before 10.1.1993 upto 2.00 p.m. in the office of ENGI­NEERS INDIA LIMITED, HINDUSTAN TIMES HOUSE, 4TH FLOOR RECEPTION, 18-20 KASTURBA GANDHI MARG, NEW DELHI-110001 (Attn. Sr. Manager (Contracts). Techno-Commercial parti.e. Part-I of the tender will be opened on the same day at 3.00 p.m. in the presence of Tenderers or their accredited representative(s). Time, date and place of opening of Part-II (Price Part) of the tender shall be intimated only to technically acceptable tenderers pre-qualified for the work at a later date.

BRPL/EIL takes no responsibility for delay, loss or non receipt of tender document sent by post. FAX/Telex/Telegraphics offers will not be accepted.

BRPL/EIL reserve the right to reject any or all tenders without assigning any reason thereof and also to give purchase preference to Public Enterprises as admissible under the existing Govt. policy.

3(i). At this stage itself we may as well note an office memorandum dated 13 January, 1992 issued by the Government of India in the Ministry of Industry, Department of Public Enterprises stating as to when contract should be awarded to a public enterprises, other things being equal. This O.M. is as under:—

“In the new environment of a liberalised Industrial Policy and the emphasis on performance improvement of public enterprises to function on commercial principles etc., further protection in the term of price/ purchase preference is not quite relevant in the new competitive environment. The matter was reviewed by the Government and the decision is as under:—

(a) Instead of granting price preference to public enterprises, Govern­ment may grant purchase preference to the public enterprises.

(b) In all such cases, while the quoted prices of public enterprises is not within the 10% of the lowest valid price bid, such a price bid may be rejected without any further consideration.

(c) Where the quoted price is within 10% of the lowest price, other things being equal, purchase preference may be granted to the public enterprise concerned, at the lowest valid price bid.

(d) The above purchase preference may be made operable for a period of 3 years as transition within which public enterprises should adjust themselves to the new environment of competitiveness and efficiency so that the entire policy of price/purchase preference may be withdrawn within the next 3 years from the date of issue of this O.M. “

4. The petitioner claiming to be possessing the qualifying requirements submitted its tender in the office of EIL in two separate sealed envelopes, one containing the techno-commercial part and the other containing the price part. B and R, the second respondent, and one Thermopack Engineers Limited also submitted their tenders. On 25 January, 1993 the techno-commercial part of the tender of all the three tenders were opened. Technical bids of both the petitioner and B and R were found to be in order. Thereafter, discussions were held between the EIL and the petitioner company and second respondent B and R. On 3 August, 1993 price bids were opened and on 31 August, 1993 contract was awarded to B and R, the second respondent. Office Memorandum dated 13 January, 1992 was relied upon while awarding the contract to the second respondent, the amount of contract being a little over Rs. 3.13 crore.

5. Contention of the petitioner is that the contract has been wrongly awarded to B and R as it did not fulfil the terms of the NIT. The work under the tender was the design, supply, erection, testing and commissioning of (i) cooling tower, and (ii) cooling water treatment plant, as a package. Petitioner contends these are two separate items, i.e., cooling tower and cooling water treatment plant. Only that tenderer could participate who met the minimum requirements mentioned in the NIT and only such a tenderer could be considered for pre-qualification for the tender. It was specifically mentioned that tenderer who did not meet the two requirements, i.e., (1) possessing experience, and (2) the annual turnover, need not purchase even the tender document. Admittedly, B and R did not possess the requisite experience and failed on the first condition. The grievance of the petitioner is yet it was granted the contract. Contention of the respondents, on the other hand, is that it was not necessary for the tenderer itself to possess the experience and that tenderer would include its collaborator as well, and the experience of collaborator would be the experience of the tenderer as well.

6. The controversy would appear to be quite simple, but record has been laden with a great mass of documents and we heard a great deal of arguments spread over a number of days and referred to various judgments of the Supreme Court and of this Court. We think the law on the question of award of tender by a State instrumentality is well settled and we do not think it is necessary for us to refer to various judgments cited at the Bar. In G.B. Mahajan and Ors. v. The Jalgaon Municipal Council and Ors., JT 1991 (1) SC 605, the Court said that in Ramana Dayaram Shetty v. The International Airport Authority of India and Others (AIR 1979 SC 1628 [LQ/SC/1979/277] ) and Kasturilal Laxmi Reddy v. State of J and K (1980 (3) SCR 1338 [LQ/SC/1980/263] ) the Court had pointed out that with the growth of a welfare state and with the Government assuming a pluralist role as provider of social welfare services and with the corresponding increase in the magnitude of the governmental functions and the consequent evolution of new forms of wealth and new forms of property, the scope for conferment of largesse by Government had increased and the discretion of Government in the disposal of such properties, rights or privileges should not be unlimited and arbitrary. The Court also observed that there was, no doubt, a degree of public accountability in all governmental enterprises, and that the question the Court was one of the extent and scope of judicial review over such matters.

7. Mr. Kapur appearing for the petitioner made the following three proposi­tions:—

(1) Tender conditions were not fulfilled by the second respondent, B and R, and it could not, therefore, have been awarded the contract.

(2) NIT clearly stated that experience had to be that of the tenderer itself and not of its collaborator.

(3) In the present case, even the collaborator of the second respondent, namely, M/s. Burger Associates Inc. USA, did not have the experience of commissioning of cooling tower on turnkey basis and no experience at all of cooling water treatment plant, and did not fulfil the first condition of NIT.

8. During course of hearing we were referred to the minutes of the EIL recommending the award of contract to B and R, which recommendation was ac­cepted by the first respondent BRPL. This is how EIL examined the experience details of the petitioner and B and R:—

1. M/s Bridge and Roof Co. (I) Ltd. (B&R):

M/s. B and R have entered into the collaboration with M/s. BURGER ASSOCIATES INC. USA who stands the guarantee for the design, construction, testing, commissioning of induced Drought Cooling Tower and M/s. Multitex Engg. Industries for process engineering, detailed engineering, assistance in procurement, supply, inspection, erection and commissioning of Cooling Water Treatment Plant. M/s. B and R shall be responsible for the execution of the work in totallity.

M/s. Burger Associates have executed Cooling Tower work involving design, engineering, erection etc. M/s Multitex Engg. Industries have also executed Cooling Water Treatment Plant works. M/s B and R have recently been awarded the work of design, construction, manufacture, supply, erection, testing and commissioning of two Induced Draught Cooling Towers by M/s NPC for their Rajasthan Atomic Power Project (Unit 3 and 4) at a contract value of Rs. 465.48 lakhs.

The Annual Turnover of M/s. B&R for 1989-90 and 1990-91 was Rs. 11,594.77 lakhs and Rs. 8991.74 lakhs respectively.

2. M/s. Paharpur Cooling Towers Ltd. (PCT):

M/s PCT Ltd. have executed works involving design, construc­tion, manufacture, supply, erection, testing and commissioning of Cooling Tower and Cooling Water Treatment Plant. They have com­pleted one such work for a contract value of Rs. 195.85 lakh for M/s Nuclear Power Corporation, Kota on 30.04.1991.

Their Annual Turn-over for 1989-90 and 1990-91 was Rs. 7915.31 lakhs and Rs. 8692.25 lakhs respectively.

Then the Tender Committee of BRPL examined the matter and recorded the following minutes:

“1. The total quoted amounts, percentage variations of the tenderers w.r. to EIL estimate of Rs. 3,00,00,000.00 were as follows:—

Sl. No. TenderQuoted AmountPercentage Variation

1. M/s. Bridge and RoofRs. 3,24,23,000.00(+) 8.08%

2. M/s. Paharpur CTRs. 3,19,15,000.00(+) 6.38%

3. Loading for FIM and guaranteed power consumption are as given under:

M/s. Paharpur

Cement 680 MT

@Rs. 3000.00/MT= Rs. 20,40,000

Steel 215 MTM/s. B&R Cement

685 MT @Rs.

3000.00/MT= Steel

263 MT @Rs.Rs. 20,55,000.00

@Rs. 13,000.00/MT Rs. 27,95,000

Power 77.80 KW4

for 8000 hrs forP13,000.00/MT Power

119.64 KW for 8000

hrs for 3 yrs@Rs.Rs. 34,19,000

3 yrs @ Rs. 1.50 Rs. 28,00,0001.50Rs. 43,07,040

Rs. 76,35,800 Rs. 97,81,040.00





Thus the total quoted amounts after loading of M/s. Paharpur and M/s Bridge and Roof are Rs. 3,95,50,800.00 and Rs. 4,22,04,040.00 respectively.

4. EIL has recommended for awarding the work to M/s Bridge and Roof, a Public Sector Enterprise subject to matching of their price with that of M/s Paharpur Cooling Tower Ltd. as per Govt. guidelinesvide OM No. DPE/13(19)/ 91-Financee, dtd. 13.01.92.

5. Recommendation of Tender Committee

The Tender Committee examined in details the bid documents and recom­mendation of M/s. Engineers India Ltd. in this connection and made the following observations and recommendations.

(a) Competence of M/s Bridgeand Roof Co. (I) Ltd.:— From the bid documents, it was observed that M/s B&R had no past experience of executing works of cooling towers by themselves. M/s. B&R stated in their tenders that they have an collaboration agreement with M/s. Burger Associates Inc., USA for design, drawing specification and other technical services like bill of quantities, commissioning, efficiency of performance and guarantee thereof. The agreement is valid for initial period of five years and the same is approved by Govt. of India and RBI. M/s. Burger Associates Inc. USA is in the field of cooling tower manufacturing for more than 35 years and had the experience of executing cooling towers upto capacity of 19,000 m/hr in USA and other countries. They are a member of Cooling Tower Institute (of USA). M/s. Burger has provided an undertaking to guarantee Jointly) for design, construction, testing and commissioning of this cooling tower for BRPL. For cooling water treatment plant portion of the work, M/s B&R has another reputed specialist in M/s Multitex Engineering Industries as collaborator. M/s. Multitex has experience of executing much higher capacity treatment plant, which are successfully commissioned. [Ref. Collaboration agree­ment with M/s. BURGER ASSO.INC; MOU with M/s MULTITEX; Experience of M/s. BURGER]

With the above background and being the premier Construction Company of India, the Committee is of opinion that, M/s. B&R has the adequate competence to undertake the works of cooling towers for BRPL. Further, M/s B&R has recently been awarded the work of design, construction, manufacture, supply, erection, testing and commissioning of two Induced Draught Cooling Towers for Reactor Units-3 and 4 by Nuclear Power Corporation of India Ltd. for its Rajas than Atomic Power Project for a contract amount of Rs. 4.65 crores.

In view of above, the Committee concurred the recommendation of M/s. EIL for negotiation in order to avail purchase preference as per Government guideline.

(b) Negotiation with M/s B&R:—In persuance of Govt. guidelines for giving purchase preference to PSU in case their prices are within 10% of the lowest price, M/s BRPL, invited representative of M/s. B&R for detailed discussion. Detailed discussion with the team of M/s. B&R headed by their Director (Proj-Mgt) took place of Dhaligaon on 25.08.93. They confirmed their revised quantities of FIM, such as cement and steel as 655 MT and 243 MT respectively. They also confirmed reduction of guaranteed power consumption from 119.64 KW to 85.82 KW. They also offered an unconditional rebate of 3.35% (Three point three five percent) on their revised quoted price, dt. 3.6.93. They also re-affirmed .their competence for cooling tower and cooling water treatment jobs and committed to depute representative of M/s. Burger Associates Inc. for supervision and commissioning purpose.

6. With their revised confirmation/reduction in quoted amount, the total of M/s. B&R came as under:—

Revised quoted amount as on 03.06.93= Rs. 3,24,23,000.00

Unconditional rebate of 3.35% given

on 25.08.93 (-)= Rs. 10,86,170.00

Rs. 3,13,36,830.00

Loadings:—

(a) Cement 655 MT@Rs. 3000.00/MT4= Rs. 19,65,000.00

(b) Steel 243 MT@Rs. 13,000.00 MT= Rs. 31,59,000.00

(c) Power consumption 85.82 KW for 8000 hrs for 3 years @Rs. 1.50 = Rs. 30,89,520.00

Rs. 3,95,50,350.00





This loaded amount matches with the loaded amount of M/s Paharpur Cooling Towers Ltd. of Rs. 3,95,50,800.00.

7. Recommendation:

In view of above, the Tender Committee recommends the award of the work of M/s Bridge and Roof Co. (I) Ltd. at the revised quoted rates amounting to Rs. 3,13,36,830.00 only on lowest tender basis. “

9. That is how the contract came to be awarded to the second respondent B&R.

10. Petitioner also submitted that after EIL made recommendation for award of contract to B&R, the first respondent-BRPL changed technical parameters after the bids had been frozen which affected the utilisation of cement, steel and electrical equipments. Petitioner said on this basis because of change of technical parameters the B and R reduced the price originally quoted and this was done to the disadvantage of the petitioner who was not given the same opportunity. It was submitted that even EIL was not consulted while changing the techno-commercial bid. The original bid given by the petitioner was approximately for Rs. 3.19 crores and that by B and R Rs. 3.24 crores. Petitioner said reduction in price was allowed to the B and R on the change of technical parameters and then the memorandum dated 30 January, 1992 was applied and the contract awarded to B and R.

11. The respondents took the foremost objection that the petition was barred by laches when the work had already been awarded to B and R who was in the process of executing the same.

12. The price bid was opened on 3 August, 1993 and the petitioner on 11 August 1993 objected to the tender of B and R as not fulfilling the conditions laid by the NIT. EIL made recommendation for award of contract to B and R on 13 August 1993. The recommendations of the EIL was considered by the first respondent-BRPL in its minutes of 25 August, 1993 and the decision to award the contract was made on 31 August, 1993. The letter dated 11 August, 1993 of the petitioner was not taken cognizance of or dealt with either by EIL or by the first respondent-BRPL. Respondents said that when the technical bids were opened in April, 1993 the petitioner was well aware of collaboration of Burger with B and R but did not object to the same, and that the objection was raised only regarding the tender of Thermopack. Petitioner said that the objection to Thermopack was on a different ground altogether. After having come to know that letter of intent was issued by the first respondent-BRPL to B and R on 31 August, 1993, the petitioner filed a writ petition in the Calcutta High Court on 15 September, 1993 and Calcutta High Court granted stay on the first respondent-BRPL from awarding the contract to B&R. It is stated that the order of injunction was served uppn the first respondent-BRPL on the following day and it was on 18 September, 1993 that the work order had been issued by the first respondent-BRPL. The first respondent appealed before the Division Bench of the Calcutta High Court which was of the opinion that writ petition could have been filed either in Guwahati High Court or Delhi High Court and that the jurisdiction of the Calcutta High Court was very much doubtful. In this view of the matter, the Division Bench observed that it was not possible to allow the impugned order to operate, and, therefore, it stayed the operation of the interim order made by the learned Single Judge. The Division Bench then recorded the statement of the counsel for the petitioner that he had instructions to withdraw-the writ petition. The Court permitted the withdrawal and noted that it shall not prevent the petitioner from filing an appropriate writ petition before the appropriate forum. It was also made clear that the Court did not enter into the merit of the controversy even remotely between the parties. This order of the Division Bench is dated 29 September, 1993. The present writ petition in this Court was filed on 4 October 1993. The Court issued notice to show cause as to why rule nisi be not issued and at the same time directed issue of notice on the application (C.M. 7629/93) of the petitioner seeking interim relief. The peti­tioner had sought an interim injunction restraining the first respondent BRPL and EIL from giving effect to the tender in question or giving any further effect to the letter of intent issued by the first respondent in favour of B & R. The Court did not grant any ex parte stay. Then on the application seeking interim relief we passed the following order on 8 November 1993:—

“C.M. 7629/93:

When in this petition we issued notice to show cause as to why rule nisi be not issued we did not grant any stay. We issued Rule D.B. on 27 October, 1993 and are now hearing the matter finally.

This petition was filed on 4 October, 1993. On the last date of hearing we were told that no actual work was being done at the site, but today Mr. Kapur informs us that excavation has been started by the second respondent. We make it clear that any work done by the respondents shall be at their own risk and costs and shall be subject to further orders of the Court. The respondents shall not claim any equity in their favour. C.M. stands disposed of.

Sd Judge. 8 November 1993.

Sd Judge.”

13. In the circumstances of the present case we do not think that the petitioner can be accused of laches. It came to this Court before even the work was started by the second respondent on the contract .It was no duty of the petitioner to raise objections to the eligibility of B&R. The evaluation of the bids had to be done by the EIL in terms of NIT and it would have been an onerous duty if it was placed on the petitioner to point out the defects when the defects to the essential conditions were patent. It cannot be disputed that B and R by itself did not fulfil the requirements of the NIT. To stake its claim to eligibility it is heavily relying on the experience of the Burger, an American company, for the purpose of cooling tower plant and on Multitex, an Indian company, for experience of cooling water treatment plant. The question that squarely arises for consideration is: Does the NIT talk of the experience of the tenderer itself or even of its collaborator Again in our opinion it cannot be disputed that the minimum requirements which a tenderer must have as set out in the NIT are essential conditions and respondents could not deviate from the same. In M/s. Poddar Steel Corporation v. M/s. Ganesh Engineering Works and Ors, JT 1991 (2) S.C. 577, the Court observed that “as a matter of general proposition it cannot be held that an authority inviting tenders is bound to give effect to eve»y 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 firs tease 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”.

14. The package requirement of N.I.T. required construction of a Cooling Tower and Cooling Water Treatment Plant. Cost of WaterTreatmentPlantis30% to 35% of the total cost of the contract. Cost of Cooling Tower Plant would, therefore, be 65% to 70%.

15. The minutes of the BRPL and EIL reproduced above show: (1) The petitioner has the experience of execution of work of erecting cooling tower and cooling water treatment plant. B&R, the second respondent, has no such experi­ence. B and R is relying on the experience of Burger for erection of cooling tower and that of Multitex for erection of cooling water treatment plant. (2) While negotiations were held with B and R for reduction of price, no such negotiations were held with the petitioner. (3) Relying on O.M. for giving preference to a public sector undertaking for award of contract would in this case mean preference to Burger, an American Company, and Multitex, a company in the private sector. This would be in term violative of the O.M.

16. The petitioner contended that reduction of free supply in the quantity of cement, steel and power would mean that technical parameters had been changed which in any case could not have been done by the first respondent without the concurrence of EIL. Petitioner said it could have also in these circumstances agreed to the reduction of free supply in the quantity of cement, steel and power. Respondents, however, said that there was no question of any change in technical specifications. They said change in technical specifications meant physi­cal variation of the design which would mean less consumption of cement, steel and power. Respondents said there was no such thing except that there was a further price reduction extracted from B and R after B and R had been found technically fit by EIL, and that this was done for the benefit of the public revenue. We may note that total price of cooling tower and cooling water treatment plant would mean: (1) the evaluated price, and (2) cost of free supply of cement, steel and power. The petitioner itself had stated that the cement and steel to be used in the construction of cooling tower and cooling water treatment plant were to be provided by the first respondent free of cost, and the price of cement arid reinforced steel was fixed for the purpose of evaluation, and so also that of fan power consumption at a certain rate. Respondents, therefore, said that when B and R -agreed to reduced quantity of cement, steel and fan power to be supplied by the BRPL this way the price was reduced to the lowest evaluated price of the bid as given by the petitioner. According to them this could be achieved by two methods: (1) by reducing the price, or (2) asking for less quantity of free supply of cement, steel and power. It was asserted that technical specifications were hot changed and that there was nothing sinister about the negotiations on this count as was contended by the petitioner. But this is what the petitioner has also objected. It stated that if it had also been given the chance it would have also agreed to less quantity of free supply of cement, steel and power or reduction in quoted price and in that case O.M. could not have been applicable as in that case quoted price by B and R would not have been within 10% of the price offered by the petitioner.

17. Dr. Singhvi, appearing for the first respondent, stated that there was no Indian company with its own design and that each Indian company for the purpose of erection of cooling tower and cooling water treatment plant had to depend upon a foreign design, and that the job requirement in fact was mainly to give shape to that design by constructing in accordance therewith. He said the petitioner was also having Marley Design, a design of an American company Marley, and in this connection reference was made to various documents filed by the first petitioner where its logo in an elliptical shape showed the word “Paharpur” and underneath it the word “Marley”. Reference was also drawn to a draft document prepared by Technology in Indian Cooling Tower Industry in July 1988, and an extract of this was filed during course of arguments by Dr. Singhvi, and in this names of seven cooling tower contractors have been mentioned. B and R does not find mentioned therein. Seven companies including the petitioner are shown to have foreign collaborators, but two of these, namely, Gammon and Thermopack, are not shown to have any foreign collaborator. We do not think any advantage can be drawn by the respondents from this document. The minutes prepared by the first respondent BRPL clearly show that the petitioner as a tenderer possessed the experience in successful execution of a cooling tower plant and cooling water treatment plant. During course of hearing we were also told that five parties including the petitioner and B and R had purchased the tender documents, and out of them only three submitted their tenders. We do not know the other two companies which did not submit their tenders had any foreign collaborator or not, or as to how many companies in the cooling tower industry have of today foreign collaborators. To have a foreign design and to have a foreign collaborator are certainly two different things.

18. We think, as noted above, it boils down to this. When the NIT uses the expression that tenderer should possess such experience, would it mean the experience of the tenderer itself or even that of its collaborator. The word “tenderer” is not a word of art. It is a word of common parlance. To us it appears this expression would mean the experience of the tenderer itself and not that of its collaborator. The minutes themselves show that for the purpose of annual turnover the respondents have taken into consideration only that of the tenderer itself in the case of both petitioner and B and R, and annual turnover of Burger and Multitex in the case of B and R has not been taken into account. Further, when the NIT says that intending tenderer must produce documentary evidence of its experi­ence of construction of cooling tower and cooling water treatment plant, and annual turnover, and other supporting documents like copies of letters of intent of works awarded, completion certificates, latest income tax clearance certificate, current commitments, audited balance sheets and profit and loss account statements for the last three years, it would clearly show that all these would be of the tenderer himself. Dr. Singhvi asserted that a tenderer need not itself possess the experience, and the only requirement was its capacity to execute the job, and for that purpose it was enough if the tenderer had constructive experi­ence. It was his submission that construction of cooling tower was the main job and construction of water treatment plant was subsidiary in nature and was part of the cooling tower plant. This argument he advanced to justify the agreement B and R had with Multitex. Dr. Singhvi said that tender document envisaged that tenderer could sub-contract any particular item with the consent of the owner. He said the construction of water treatment plant was sub-contracted by B and R to Multitex. Further, to illustrate his point, Dr. Singh said if the contract required construction of four items, one item could be sub-contracted with the permission of the owner. Dr. Singhvi said that in the writ jurisdiction the court was merely concerned with two aspects:(1) that the Court has to see particularly the substance of the case and not the form, and (2) deviations from strict technical terms are permissible except when these are found to be arbitrary. Then Dr. Singhvi said in industry the idea was to have the best possible technology and for that one has to consider the meaning in technical parlance when everybody knew that there had to be a foreign collaborator for construction of cooling tower and water treatment plant and particularly when the petitioner itself was having a foreign collaborator. Then he said that the word “possess” had to mean physical, legal or constructive sense in respect of tender document in relation to the industry. He said the word “possess” used in NIT was to be interpreted in conspectual sense to mean and include a capacity to either do it itself or to ensure to get it done. Therefore, he said it included power to call upon, the power to direct, the power to ensure compliance and the power to achieve the desired results. He said that the word “possess” did not say in terms that collaboration was included, but it also did not say the work had to be done by the tenderer itself or in its own name. Reference was made to some decisions under the Arms Act, 1959, and the Hindu Succession Act, 1956, to show as to what the word “possess” would mean in law. In Gunwantlal v. State of Madhya Pradesh, (1972) 2 SCC 194 [LQ/SC/1972/293] ), the Court examined the question of possession of a fire arm under Section 25(a) of the Arms Act, and in Superintendent and Remembrancer of Legal Affairs, West Bengal v. Anil Kumar Bhunja and Others, (1979) 4 SCC 274 [LQ/SC/1979/346] , where the Court examined the question of “posses­sion of another person” as appearing in Section 29(b) of the. Reference was also made to the expression “any property possessed by a female Hindu” as appearing in Section 14 of the Hindu Succession Act, 1956, and in this connection cases referred to were Gummalapura Taggina Matada Katturuswami v. Setra Veeravvaand Others, AIR 1959 SC 577 [LQ/SC/1958/173] , and Mangal Singh and Others v. Smt. Rattno (dead) by her legal Rejiresentatives and Another, AIR 1967 SC 1786 [LQ/SC/1967/119] . Another judgment of the Supreme Court in Kailash Rai v. Jai Jai Ram and Others, (1973)1 SCC 527 [LQ/SC/1975/64] , was relied upon where the Court examined the question of constructive possession as to whether possession by one co-sharer could be possession for all in absence of plea of ouster while interpreting Section 18(l)(a) of the U.P. Zamindari Abolition and Land Reforms Act, 1950. Yet another decision referred to was of Queenss Bench Division of England in Woodage v. Moss, [1974] 1 All.ER 584, where the question was whether the accused was in possession of a firearm within the meaning of Section 1(1) of the Firearms Act, 1968, which provided that it was an offence for a person to have in his possession a firearm to which the section applied without holding a firearm certificate in force. We, however, do not think that the judgments relied upon by the respondents are of relevance or that all this is necessary. If we accept the plea of the respondents it would be giving offence to a clear language. We feel that this argument has been advanced to deflect the real issue as to whether the tenderer itself possessed the experience.

19. In his submission Mr. Arun Jaitley appearing for B and R also supported Dr. Singhvi and referred to Dias on Jurisprudence as to the meaning of the word “possess”. Mr. Pratap Kishan appearing for EIL said that the understanding of all concerned was that “possession” would mean that there would be a back up by a foreign company. He was confronted with NIT issued by EIL itself in the case of Cooling Towers and including Cooling Water Treatment Plan for Gandhar Petro Chemical Complex at Daheg. In this it is clearly mentioned that in case any back up consultant was proposed to be engaged by the tenderer he shall submit the memorandum of understanding with its back up consultant along with the experience details of the back up consultant exactly as per tender proforma along with its offer. Mr. Pratap Kishan said in this case only limited tender enquiry was issued and that was the reason that this condition was stipulated. We have also been referred to NIT issued for the Nuclear Power Corporation of India Limited, Rajasthan Atomic Power Project, wherein in the qualifying requirements of the tenderer it was mentioned that the tenderer shall include in its tender an undertaking jointly executed by it and its collaborator to guarantee the design, construction, testing, etc. of cooling tower as detailed in the tender specifications, and that such a joint undertaking should also clearly spell out that the collaborator would associate himself with the tenderer to the required extent in the execution of the contract and confirm that the collaboration agreement will be kept valid at least upto the competition of the proposed contract. Yet another condition is that the tenderer or collaborator shall preferably have operated such an agreement previously. All this would rather show that where NIT required collaborator it was specifically mentioned. NIT in the present case does not talk of any collaborator and we would not find any substance in the argument of the respondents that experience of tenderer would mean experience of its collaborator as well.

20. Various clauses of the agreement between B and R and Burger have been referred to by Dr. Singhvi to contend how Burger was responsible for execution of the contract somuch so it was stated that Burger was a joint tenderer. Experience of Burger and it being a leader in the erection of cooling tower have also been stressed. We are not at all doubting the competence of Burger to execute the contract of erection of cooling tower as it is no business of ours. We have only to see if the principles of law as laid have been complied by a State instrumentality, which the first respondent is, by placing the contract on B&R, and again we have to examine if the terms of the OM have also been adhered to while granting the contract to R-2, another instrumentality of the State, particularly when stress these days is on free economy and liberalisation, as the preface of the OM which has been quoted above would show. We find the argument of Burger being a joint tenderer is fallacious. The words “tenderer should possess” have to be given their ordinary meaning. NIT talks of the experience of the tenderer himself and not of its capacity or capability to get the work performed through other agencies howsoever that third agency might be competent. We cannot be asked to read into a document words which are not there, nor the Court can be asked to re-write a document or a contract. To us it appears that the language of the NIT is clear and unambiguous. We are not at all impressed with the argument that the word “possess” in the present context must be construed to mean “availability of experience with the tenderer to execute the contract”. Respondents 1 and 3 have themselves held that B and R had no past experience of executing works of cooling towers by itself. That would show how R-1 and R-3 thesmselves understood the expression “tenderer must possess”. Yet another argument raised was “monopo­listic tendency” of the petitioner had to be curbed. This argument is perhaps based on the fact that if B and R is not held to be qualified then only the petitioner would remain in the field for award of the contract. We do not find there is anything wrong with this. Petitioner has been held to be technically qualified to do the job. Competitive price bids are there in any case. Negotiations are jointly held to lower down the prices quoted. While examining the bid documents it never crossed the minds of R-l and R-3 that if only one party remained in the field, R-l and R-3 were not bound to award the contract to that party. We, therefore, need not consider this argument that with B and R going out petitioner would enjoy a monopoly. As noted above, for the meaning of the word “possess” we have been referred, to law reports and various dictionaries. We asked an Engineer of EIL, who was present in Court, to assist the Counsel if EIL was having all these law reports and dictionaries and if the NIT was vetted or drafted by the legal department of the EIL, and his answer was, No.

21. We are also of the opinion that respondents 1 and 3 could not relax the essential conditions of NIT on the plea of public interest. The public interest, according to these respondents, is the award of contract by one public sector undertaking to another public sector undertaking. We do not think that would be a public interest in the context of which O.M. has been issued and which is purported to have been acted upon by R-l and R-3. The contract was awarded to B and R bringing the price to that quoted by the petitioner without having held negotiations with the petitioner if he could also scale down the price quoted.

22. A major chunk of the contract, which is about l/3, involved the erection of cooling water treatment plant. Burger admittedly has no such experience. M.O.U. (memorandum of understanding) by B and R was entered into by B and R with Multitex a week earlier to the submission of the tender. Except to note that Multitex has experience of executing much higher capacity treatment plant, the terms of M.O.U. were not examined. There was no formal agreement entered into between B and R and Multitex, and there was no safeguard if Multitex walked off during the execution of the contract. In this view of the matter, it is not necessary for us to go into the further question raised by the petitioner if Burger and Multitex had ever successfully executed the installation and commissioning of a cooling tower plant and a cooling water treatment plant on turnkey basis of the value contemplated by the NIT. For the same reasons we need not refer to the terms of the collaboration agreement between B and R and Burger, though on behalf of BRPL it was strongly contended that under Clause 4(d) of the agreement Burger had taken full responsibility and guarantee of desired performance of cooling towers as per specifications.

23. We are not unmindful of the fact that there could be deviations from the strict terms of the tender while, of course, there is no prejudice involved. The Court does not sit as an appellate body looking into the entirety of the tender process. The scope, ambit, nature and degree of judicial review in a tender case is limited leaving substantial area or “play in the joint” as the term goes. Understanding of those who operate the tender is to be given due weight. But when the NIT required that “tenderer should possess” it could not mean that its collaborator, if any, should possess or that the tenderer should be capable of getting the work executed from any third party possessing that experience. And when NIT permitted a collaborator it has said so in clear terms but not in the present NIT. Taking into considerations all these limitations we are of the view that contract has not been rightly awarded to the second respondent. We are not questioning for a moment the bona fide of the EIL in making recommendation to the first respondent to award the contract to the second respondent. What we find is that in making recommendation it went against the terms of NIT and B&R, the second respondent, did not have the essential conditions of the NIT inasmuch as it did not possess any experience of erection of a cooling tower plant and cooling water treatment plant. Such a decision by the respondents cannot be held to be within the confines of reasonableness when it is against the very basic and essential conditions of the NIT, If we accept the interpretation suggested by the respon­dents it would be enlarging the scope of the NIT when its language is plain and unambiguous. We cannot rewrite, recast or reframe the terms of the document. We cannot read words into it which are not there. Moreover, violance has been given to the O.M. inasmuch as quantity of free supply of cement and steel has been artificially reduced and so also certain quantity of supply of power in the sense that such an offer was not taken from the petitioner. This action of the first respondent would also appear to be arbitrary and unreasonable.

24. In Ramanas case (AIR 1979 SC 1628 [LQ/SC/1979/277] ) a notice inviting tender was put up by the International Airport Authority of India, a State instrumentality, for putting up and running a second class restaurant and two snack bars at the International Airport at Bombay. The notice stated that “sealed tenders in the prescribed form are hereby invited from Registered IInd Class Hoteliers having at least 5 years experience for putting up and running a IInd Class Restaurant and two Snack Bars at this Airport for a period of 3 years.” The Court said that this prescribed a condition of eligibility which had to be satisfied by every person submitting a tender and if, in a given case, a person submitting a tender did not satisfy this condition, his tender was not eligible to be considered. The court said that language of N.I.T. was clear and respondent International Airport Authority of India could not accept tender of a person who did not fulfil a requisite qualification. Then the Court said as under:—

“ It is a well settled rule of interpretation applicable alike to documents as to statutes that, save for compelling necessity, the court should not be prompt to ascribe superfluity to the language of a document and should be rather at the outset inclined to suppose every word intended to have some effect of be of some use. To reject words as insensible should be the last resort of judicial interpretation, for it is an elementary rule based on commonsense that no author of a formal document intended to be acted upon by the others should be presumed to use words without a meaning. The Court must, as far as possible, avoid a construction which would render the words used by the author of the document meaningless and futile or reduce to silence any part of the document and make it altogether inapplicable. Now, here the expression used in paragraph (1) of the notice was “registered Second Class hotelier” and there can be no doubt that by using this expression the 1st respondent intended to delineate a certain category of persons who alone should be eligible to submit a tender. The First respondent was not acting aimlessly or insensi­bly in insisting upon this requirement nor was it indulging in a mean­ingless and futile exercise. It had a definite purpose in view when it laid down this condition of eligibility in paragraph (1) of the notice”.

25. The Court held that both having regard to the constitutional mandate of Article 14 as also the judicially evolved rule of administrative law, the Interna­tional Airport Authority of India was not entitled to act arbitrarily in accepting the tender of the person who did not conform to the standard or norms laid down in the notice inviting tender which required that only a person running a registered second class hotel or restaurant and having at least five years experience as such would be eligible to tender. The law laid down in this case would squarely be applicable in the present case before us.

26. The respondents, however, placed reliance on another decision of the Supreme Court in M/s. GJ. Fernandez v. State of Karnataka and Ors., [JT 1990 (1) SC 134 [LQ/SC/1990/55] ]. In this case the contract pertained to the construction of a main station building of a Power House and the notice inviting tenders from registered contractors of appropriate class laid the following conditions that the intending tenderer:

(1) should have executed civil and architectural works including insultation in a power plant/industrial complex, preferably in power plant;

(2) should have executed atleast 1000 cubic metres per month of concrete pouring and atleast 300 cubic metres per month of brick work at one site; and

(3) should have had an annual turnover of atleast 1 crore for each of the preceding three years.

It was contended that the contractor who was awarded the award did not fulfil the conditions prescribed in the first paragraph. This is how the Court dealt with this contention:—

“So far as para I is concerned, two defects were pointed out. The first was that, as against the requirement that the applicant “should have exe­cuted.... works including insultation”, the certificate of 25.1.1989 pro­duced by the MCC was only to the effect that it “is constructing” a building in Hyderabad for the National Geophysical Research Institute “in which they have done wall insulation and roof insulation for air-conditioning work”. The second was that, as against the second requirement of para I that the applicant should have executed “at least 300 cubic metres per month of brick work at one site, the certificate from Vasavadatta Cement produced by the MCC (Mysore Construction Co.) on 1.2.89 only stated that it had “constructed over 300 cubic metre of brick masonry for the packing plant and D.G. Building totalling to 327.29 cubic metre during the month of June 1985”. These certificates, it is submitted, do not come upto the requirements of Para I. We think that this criticism, based on the differences in wording as between the language of para I and the certificates produced by the MCC (Mysore Construction Co.), is too weak to be accepted. It was for the KPC (Karnataka Power Corpora­tion Limited) to consider the sufficiency of these certificates. The condi­tion only required that the applicant should supply information to show that he had experience in insulation work and that he could carry out brick work in a month to the extent indicated. It was for the KPC (Karnataka Power Corporation Ltd.) to assess the value of the certificates furnished in this regard and if the KPC (Karnataka Power Corporation Ltd.) considered them sufficient to warrant the issue of a tender form to the applicant, we do not think we should interfere with their decision.”

Thus, while the requirement for supply of tender documents in that case was that the party should have executed a certain magnitude of work, the certificate produced by the party complained against showed that it was executing works of that magnitude. The Court said that the criticism, based on the differences in wording as between the language of para I of the eligibility conditions and the certificates produced by the party, was too weak to be accepted. This authority is clearly distinguishable and does not help the respondents in the present case.

27. Because of the view which we have taken, only the petitioner would be left in the field. This was subject to comment by Dr. Singhvi who said that in case of tenders basic prejudice is that of exclusion and that over inclusion itself is not prejudicial or arbitrary and that in this case all the tenderers have been included and it is not a case of exclusion, and further that if B and R goes out there would be monopoly, there being no competition, and it would be at the cost of the public revenue. We find ourselves unable to agree with Dr. Singhvi. In the era of free economy which has been set about yet special advantage has been conferred upon public sector undertakings and one need not travel beyond that in the days of competitiveness. Here two parties, the petitioner and B&R, competited, and the petitioner qualified for the a ward of tender. There appears to be no reason to deny the contract to the petitioner merely on the spacious plea that only the petitioner would be left in the field.

28. Dr. Singhvi said judicial review could be invoked only to strike down a action if (a) there are mala fides, or (2) bias, or (3) arbitrariness boardering on perversity or such unreasonableness as no reasonable man would contemplate. We agree that untramalled judicial review is not desirable and there has to be a self imposed discipline, but then there cannot be any generalisation.

29. When a public sector undertaking, an instrumentality of State, seeks prefrential treatment, in all fairness and propriety it should not have proceeded with work which of course it did at its own risk and costs. When a decision or an action is wrong it cannot be righted by presenting a fait accompli.

30. Now the vexed question of grant of relief. The second respondent, however, cannot claim any equity in its favour though it may have started any work on the contract. In Harminder Singh Arora v. Union of India and Others, (1986) 3 SCC 247 [LQ/SC/1986/194] , the court while allowing the appeal set aside the orders of the authorities rejecting the tender of the appellant and directed the authorities to accept the tender of the appellant. In the present case we find we should pass a similar order. The submission of the date of tender was extended to 25 January, 1993. After the technical bids were opened, EIL had discussions with the petitioner and the minutes of the meetings have been brought on record. As noted above, on 11 August, 1993 petitioner wrote to EIL stating that B and R did not meet the essential requirements of NIT and OM also did not apply since B and R had no experience at all of erection of a cooling tower plant and it is also mentioned in this letter that in the year 1992 B and R had purchased a cooling tower from the petitioner for Raja Bazar Gas Project, Calcutta, which showed that till last year B and R did not manufacture the cooling towers. Petitioner wrote in this letter that Clause (c) of the O.M. would apply only if other things were equal and since B and R had no experience whatsoever of the manufacture of cooling towers, Clause (c) would not apply, and so the O.M. would be inapplicable. On 21 August, 1993 petitioner wrote letter to BRPL, the first respondent, pointing out the infirmities in the recommendation of EIL that contract be awarded to B&R. It was again stated that B and R did not fulfil the essential conditions of the NIT and the O.M. also did not apply. On 31 August, 1993 again a letter (handwritten) was addressed by the petitioner to BRPL objecting to the grant of the contract to B and R and stating also B and R had brought down its evaluated prices to make it at par with the petitioner by reducing the quantity of steel and cement and fan motor BHP consumption. Petitioner, therefore, said in this letter that technical parameters had been changed and this privilege was not given to it. Though we have noted above the argument of Dr. Singhvi that technical parameters did not change and that the B and R merely asked for” reduced free supply of cement, steel, etc., frankly, we are unable to appreciate this argument. If ultimately the quantities of cement, steel and power are to remain the same, why could not B and R reduce the quoted price itself. Therefore, there appears to be some substance in the argument of the petitioner. All these letters of the petitioner, we find, have not been referred to in the minutes of the BRPL and EIL shown to us. The petitioner then immediately took the matter to Court and knowing fully well the pendency of the proceedings BRPL placed work order with B and R with a possible attempt to frustrate the right of the petitioner to have the contract. In the letter dated 31 August, 1993 of the petitioner to BRPL the petitioner desired equal opportunity to discuss and then agreed to of f era sum of Rs. 31 lakhs reduction on the base price of Rs. 3,19,15,0007- quoted earlier, all other details remaining unaltered. The quoted price would, therefore, come to Rs. 2,88,15,000.

31. The respondents, however, relied upon a decision of the Supreme Court in M/s. Chingleput Bottlers v. M/s. Majestic Bottling Co., AIR 1984 SC 1030 [LQ/SC/1984/79] , to contend that this Court cannot issue mandamus directing the award of the contract to the petitioner. In this case the High Court had issued a mandamus directing the Commissioner of Prohibition and Excise to issue licence for the manufacture and supply of bottled arrack to a party which fulfilled the conditions as laid down by the Rules being the Tamil Nadu Arrack (Manufacture) Rules, 1981, framed under the Tamil Nadu Prohibition Act, 1937. Under Rule 7 of the Rules, the grant of licence is subject to the prior approval of the State Government and is in the discretion of the State Government. The question before the Supreme Court was as to the jurisdiction of the High Court to issue a writ of mandamus directing the Commissioner to grant licence to that particular party. The Court held that the High Court exceeded its jurisdiction in issuing the writ of mandamus when it directed the Commissioner to grant licence without the prior approval of the State Government as enjoined by Rule 7 of the Rules. The Court, therefore, set aside the order of the High Court and remanded the case to the Commissioner for a fresh decision in accordance with law. Similarly, in Munindra Nath Upadhyaya v. State of U.P. and Others, AIR 1992 SC 566 [LQ/SC/1991/596] , the Court set aside the order of the High Court where it had issued a writ of mandamus to the Commissioner, Jhansi Division, Jhansi, to accept the bid of the petitioner in respect of a certain auction. The Supreme Court said that a direction for the acceptance of the bid and award of the contract without the satisfaction of other requisite and relevant conditions might not be appropriate and that the State Government should have been given liberty to decide the matter in the light of all the considerations relevant to the matter. The Court upheld the order of the High Court to treat a particular party as the highest bidder. But then the court said that in proceeding on that basis the Government must be at liberty to deal with the matter in the light of the other conditions applicable to the matter. The Court, therefore, said that the form in which the direction couched required to be modified appropriately. The Court, therefore, while directing the authorities to accept the highest bidder as held by the High Court said it would be open to the authorities to decide whether they would, in the circumstances, accept the highest bid as adequate and to ensure compliance with applicable conditions. Both these judgments are, therefore, distinguishable and do not support the respondents.

We, therefore, quash the order awarding the contract to the second respon­dent and at the same time issue mandamus to the first respondent directing it to award the contract to the petitioner, quoted price of the contract being Rs. 2,88,15,000, other things remaining the same. Petitioner will be entitled to costs. Counsel fee Rs. 5,000.