THDC INDIA LTD. Vs VOITH HYDRO GMBH CO.
Bench: V.S. SIRPURKAR,T.S. THAKUR, , ,
Case number: C.A. No.-002572-002572 / 2011
Diary number: 4862 / 2011
Advocates: K J JOHN AND CO Vs
AMIT ANAND TIWARI
“REPORTABLE”
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO 2572 OF 2011 [Arising out of SLP (C) No. 4644 OF 2011)
THDC India Ltd. … Appellant
Versus
Voith Hydro GMBH Co. & Anr. … Respondents
J U D G M E N T
V.S. SIRPURKAR, J.
1. Leave granted.
2. This case is a classic example of the whole nation suffering on
account of the fight between two multi-national companies in respect of
each other’s rights. There is no dispute that the Tehri Pump Storage Plant
project is of utmost importance to the State of Uttarakhand particularly, and
to the nation generally. Substantial electricity generation is the object of
that project. It is only with that objective that a dam was constructed on
river Bhagirathi involving crores of rupees for the construction as also for
the rehabilitation of the persons who were displaced on account of the
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construction of dam. Tehri Pump Storage Plant is a project within the
larger picture of Tehri Dam and would prove to be a boon for the additional
electricity generation. It is a project involving technical issues. The
appellant which is a corporation under the Government of India has been
at this project right from August, 2007. Considering the tremendous
importance of the project, it has yet not been able even to finalize the
tender. Three and a half years have rolled by and yet no progress has
been made, thanks to the legal battles in between the two giants called
Voith GMBH (respondent No.1) and Alstom (respondent No.2).
3. It is not for the first time that this Court has to deal with the matter.
Even about a year back, this Court was required to deal with the matter
extensively and while dealing with the matter, the Court, in its order dated
26.3.2010 observed:
“We are pained to note that a very important project like the present one is being held up in a legal battle between the two multinational companies. Till today, even the contract has not been finalized. All this would invariably cause loss to the nation. After all, contractual rights of these companies are not more important than the national interest.”
4. In spite of these observations, we are extremely sorry to note that
the matter has not reached its finality as yet and, therefore, we are
constrained to interfere against an interim order passed by the High Court.
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The issue of national interest is our prime concern, the importance of
which cannot be undermined.
5. Before we take up the issue for consideration, a short resume
regarding the progress (?) would be worth seeing. The notice inviting
tender on the prime turn-key execution was issued on 31.8.2007. Bids
were received on 29.12.2007 in all from four companies, the respondents
being a part of them. After opening the pre-qualification bids, two of the
tendering parties were found to be dis-qualified leaving only the two
respondents in the fray. On 15.1.2009, financial bids were opened in
respect of the offers made by the two respondents. Obviously, on the
basis of the fact that offers of the two respondents were found to be
responsive, respondent No.2 approached the Court by way of a writ
petition challenging the validity of the two bids submitted by respondent
No.1. The High Court of Uttarakhand issued a stay order and ultimately on
29.6.2009 though it held that the objection raised by respondent No.2
against respondent No.1 regarding its lack of experience was not valid, the
bidding documents themselves were not clear as to the manner in which
the bids were to be made. It, therefore, directed the appellant to invite
fresh bids. Special Leave Petition No.15779 of 2009 came to be filed
before this Court and the respondent No.1 also filed an intra-court appeal
being Appeal No.131 of 2009 before the High Court of Uttarakhand. With
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the sole objective of giving quietus to the issues and to provide the motion
for the project, this Court transferred the said appeal filed by respondent
No.1 and tagged it along with the Special Leave Petition. Since the
Attorney General had offered to abide by the operative order of the High
Court, this Court directed the appellant herein to invite fresh price bids by
its order dated 11.09.2009. Thus, bids were examined by the appellant
and it was found that the bid filed by Alstom, respondent No.2 was
substantially lower. However, there were certain deviations in the fresh
bids offered by the respondent. Respondent No.2, therefore, objected to
the report dated 8.11.2009 and took exceptions to some of the
observations and insisted that there were no deviations in the techno-
commercial part of the bid. By their another letter dated 16.1.2010,
respondent No.2 again reiterated their objections and insisted upon the
grant of contract in their favour. In order to maintain transparency and
objectivity, the appellant offered to send the fresh bidding process for
consideration by a panel of experts of national repute. They were to
examine objections raised by the consortium of respondent No.2. They
submitted their report on 8.2.2010 and observed that the fresh bid of M/s
Alstom was non-responsive. In this backdrop, the Court heard both the
parties as also the appellants all over again and ultimately passed an order
on 26.03.2010.
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6. The Court considered the question framed by the panel of experts
which was to the following effect:
“whether the examination of report of THDC declaring the bid of the consortium of M/s Alstom is OK or the objections raised by the consortium of M/s Asltom are justified with reference to the terms and conditions of the tender, techno-commercial bid submitted in October, 2008 and fresh price bid submitted in October, 2009 and their bid can be considered as responsive.”
The Court also noted the conclusion drawn by the panel of experts
which was to the following effect:
“based upon the views outlined, POE is of the opinion that fresh price bid of consortium of M/s Alstom is not non-responsive. Their quoted price of partnership basis even though non-responsive is, however, lower by 84.5 crores (M/s Voith Rs. 21,551,245,304.00, M/s Alstom Rs.20,705,840,090.00). Similarly, the quoted price on assignee basis though non-responsive is lower by 108.7 crores (M/s Voith Rs.22,343,174,985.00 M/s Alstom Rs.21,256,007,413.00). The unconditional offer of the consortium of Alstom to take care of the THDC observations without any extra costs was that the bid becomes responsive and in accordance with the employers’ requirements is not acceptable as this is not permissible under bidding document of this tender.”
7. During the hearing, respondent No.2 had urged that panel of experts
had not given any fair deal to respondent No.2 and it prayed that the
matter should be sent to the Government of India. This was obviously
opposed by the Attorney General as well as M/s Voith and, therefore, this
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Court took note of the contentions that the nature of objections to the
report was of technical character and the bona fides of panel of experts
was not questioned. The Court further took note of the stand taken by the
Attorney General that the respondent No.1 could still address the panel of
experts and further hearing could be given to M/s Alstom. The Court found
the offer given by the Attorney General to be a fair offer and, therefore, one
more opportunity was directed to be given to the parties for appearing
before the panel of experts and, therefore, a report was directed from the
panel of experts. The Court fixed the end of April 2010 for this purpose. It
was observed in paragraph 11:
“the appellant herein would then, without loss of time, take decision, considering the report of the panel of experts regarding the award of contract.” (emphasis supplied)
In view of this, the Court disposed of all the pending matters
including the appeal filed by M/s Voith, respondent No.1 herein. The Court
observed:
“The exercise of bidding before this Court was ordered with the sole objective of saving time and to give the transparency to the whole exercise. Once the fresh bids were allowed to be given the old controversies before the High Court would naturally become extinct. In our opinion it would be in the interest of the project which has already been dragged by more than a year that the Panel of Experts should be allowed to consider the objections and express their opinion. That opinion shall then be considered by the appellant which would take the final
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decision on that basis. We must reiterate here that it is not for this Court to award the contracts by accepting or rejecting the tender bids. It is exclusively for the appellant herein to do that. Once all this exercise is over, nothing would remain for us to decide in these appeals.”
8. What followed thereafter is more interesting. On 17.4.2010, detailed
written submissions file by both the respondents before the panel of
experts wherein respondent No.2 pointed out that there were several
technical deviations in the bid of M/s Voith which were not considered so
far by the appellant. Several technical issues were raised and it was
pointed out that the bid of M/s Voith was not in accordance with the
technical requirements. It was stated that the bid of M/s Voith, respondent
No.1 had more than 40 commercial deviations and more than 90 technical
deviations. It was, therefore, requested that panel of experts should look
into the above referred matters and to look into all these aspects including
the deviations of the bidding on the part of the respondent No.1. This was
reiterated by subsequent letter dated 27.4.2010. On 29.4.2010 after going
into the details of the contentions raised by both respondent Nos. 1 and 2
the panel of experts went into the details regarding the deviations and non-
conformities in M/s Alstom, respondent No.2’s fresh bids but did not give
any finding regarding the deviations pointed out by it in respect of
respondent No.1, M/s Voith. It, however, expressed in the following terms:
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“M/s Alstom during hearing have pointed some specific issues relating to bid of M/s Voith Siemens regarding sourcing and supply of Turbine Shaft and Rotor from Germany/ Italy/ Czech/ Spain/ Korea. In respect of Rotor they have also included Poland (Reference written submissions dated 17.4.2010, Volume-II A). they also pointed out regarding supply of Spherical
Valve from Voith, USA. M/s Alstom Consortium in their rejoinder (15.4.2010) under “overall conclusions” (page 46) they also requested to enquire that both bids have been evaluated at par and cross checked in details that Voith’s bid is not containing hidden deviations as was the case for MIV. THDC will have to look into these issues along with all other issues particularly with regard to clause 9.4.4 of employer’s requirements (amendment No.9 at Annexure 17) before taking a decision if M/s Voith’s bid is responsive or non-responsive. (emphasis supplied)
9. Again respondent No.2, M/s Alstom filed letters dated 12.7.2010 and
23.7.2010 to the appellant and to the Ministry of Power. The matter was
then taken up on the basis of the report of the panel of experts by tender
committee. Tender committed again went into the exercise and submitted
its report on 2.8.2010 wherein it was observed that the fresh price bids of
consortium of M/s Asltom both as the partner and as the assignee were
not responsive. It recommended further that negotiations would have to be
undertaken with the respondent No.1, M/s Voith for considering the
downward trend in prices and to much with the quoted prices of
respondent No.2. It was also observed that the deviations of bids of
respondent No.1 should be discussed with it. The matter then went the
higher level of Executive Director, Contracts. He observed in his note
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dated 8.9.2010 “if a minute scrutiny is carried out in respect of the bids of
both the bidders, both the bids cannot be said to be fully responsive to the
tender conditions”. It was observed that even the bid of respondent No.1,
M/s Voith could not be said to be fully complying and it was observed:
If an impartial and independent scrutiny of tender is carried out, it may appear that THDC has been too stringent on M/s Alstom and quite lenient in case of M/s Voith Siemens. In a true stricter sense, it appears that there have been some non-conformities in the bid of M/s Voith Siemens also.”
It was then suggested in the note that the tender committee should
identify the non-conformities in respect of both the bidders and bidders
should be asked to submit their fresh price bids after fully complying with
the tender conditions without deviations. (emphasis supplied)
10. The competent authority, therefore, took a decision on 1.10.2010 to
call for the fresh bids after due identification of the non-conformities. Both
the bids were, therefore, scrutinized in great details. Even the
deliberations were held between 2.11.2010 and 14.12.2010 and ultimately
a report was submitted by the tender committee on 14.12.2010 in relation
to the non-conformities of both the bidders. The report contained two
annexures being annexures 1A and 1B detailing the non-conformities in
respect of respondent No.2 and respondent No.1, respectively. Therefore,
a communication dated 21.12.2010 was sent to both the respondents that
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it is only after the unqualified and unconditional compliance to the
employer’s requirements in respect to the non-conformities pointed out in
annexures 1A and 1B and on the respondents agreeing to comply with the
objections raised as regards the non-confirmities that the respondents
would submit fresh price bids.
11. In this letter all the earlier correspondence and the techno-
commercial bids including all earlier letters sent by both the respondents
were referred to. The report of the panel of experts was also referred to. It
was stated that the techno-commercial offers of both the bidders were
reviewed at length and it was decided to invite fresh price bids from both
the bidders. The letter went on to clarify that these bids were invited in two
stages. In the first stage both the bidders were required to convey their
unqualified and unconditional compliance with the employer’s
requirements with respect to the shortcomings observed in their respective
bids, so as to resolve all the inconsistencies and thereby ensuring
compliance with the tender conditions (In terms of the annexure 1A for
consortium of M/s Alstom and annexure 1B for the consortium of M/s
Voith). It was clarified that subsequent to such unqualified and
unconditional confirmation by the respective bidders, the bidders were to
put their fresh price bids in the second stage. Seven pre-conditions were
then put and it was clarified that the stage of price bidding i.e. regarding
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the un-conditional compliance the bidders were to submit the documents
latest by 7.1.2011, 4 p.m. IST. The validity of the bid was limited to 180
days from the date of submission of the fresh price bid.
12. This letter dated 21.12.2010 was challenged by the respondent No.1
by way of a writ petition No.212 of 2011. But before that respondent No.1
had addressed a letter to the compliance dated 24.12.2010 that inviting
fresh price bids was not in accordance with the bidding documents and
was contrary to the legal position. In that letter it was stated that it
reserved the right to challenge the decision to invite fresh price bids and
therein also sought time on any day after 18.01.2011 to seek certain
clarifications in respect to the THDC’s letter dated 21.12.2010. It also
sought for extension of the compliance of first stage of price bidding. This
request of extension was acceded to by the appellant THDC and it fixed a
meeting on 19.1.2011. In the letter sent by THDC dated 4.1.2011 THDC
refuted the contention raised by respondent No.1 regarding the invitation of
fresh price bids. Yet another objection was raised by a letter on 15.1.2011
on behalf of respondent No.1. for inviting the fresh price bids. In addition
to this notice, fresh report of the panel of experts dated 29.4.2010 and
further recommendations/reports of the tender committee were also sought
for. The meeting took place on 19.1.2011 when in addition to the appellant
THDC officials, representatives of respondent Nos.1 and 2 were present
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wherein the same stand was allegedly reiterated by respondent No.1. A
further letter dated 20.1.2011 was sent by the respondent No.1 calling
upon THDC:
“1) to respond to the points raised in the letter dated 15.1.2011;
2) requesting for a copy of the fresh report of the panel of experts dated 21.4.10;
3) requesting for the copy of the subsequent report/recommendations of the tender committee.”
13. This letter was responded to by THDC wherein it reiterated its stand
dated 21.12.2010 and further conveyed that it was not obliged to provide
fresh reports of the panel of experts or reports of the tender committee.
14. On this basis, respondent No.1 proceeded to file a Writ Petition in
the High Court of Uttarakhand challenging the letter dated 21.12.2010.
This Writ Petition seems to have been filed on 27.1.2011 and was placed
before the Learned Vacation Judge of the High Court of Uttarakhand. The
High Court then passed the following order:
“After hearing rival contentions of learned counsel for the parties, this Court is of the view that the opinion/recommendation made by panel of experts should be placed on record along with the objections raised by the parties and the report of the tender committee and recommendations of the Executive Director.
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Mr. Rawal learned Additional Solicitor General of India stated at Bar that the petitioner must also comply with the letter of respondent No.1 though annexure P-1. to which learned counsel for the petitioner stated that without prejudice to the rights of the petitioner, he shall comply with the same within a week if the date of compliance is so extended as the date has expired on 31.1.2011.
Mr. Rawal learned counsel for respondent No.1 prays for and is granted time to file counter affidavit. The counter affidavit may be filed by 8th February, 2011. Respondent No.2 may also file counter affidavit, if any, within the same period. Copy of the counter affidavit be supplied to the petitioner well before the fixed, who shall also file his reply to this Court on or before 11th February, 2011.
Adjourned to 17.2.2011.
In the meanwhile, no further proceedings shall be undertaken by respondent No.1.”
15. It seems that by their letter dated 12.2.2011, respondent No.1 have
sent their compliance to annexure 1B of the letter dated 21.12.2010. It has
been stated in that letter at the outset, and as recorded in the aforesaid
order dated 1.2.2011, we have to state and emphasize that compliance by
the Voith Hydro Consortium with the order dated 1.2.2011 passed by the
High Court is strictly without prejudice to the rights and contentions of the
Voith Hydro Consortium as well as without prejudice to the contentions
and grounds raised in Writ Petition No.212 of 2011. Added to this is
annexure signifying compliance with the question raised by the THDC as
regards to the non-conformities.
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16. In the Writ Petition, amongst the other prayers, a direction was
sought against the appellant to award the contract in respect of Tehri
Pump Storage Plant. The main attack in the Writ Petition was on the letter
dated 21.12.2010 on the ground that the decision therein was ex-facie
illegal, unreasonable, arbitrary, unfair and biased and that the said
decision was taken with a sole and ulterior motive of benefiting Alstom
(respondent No.2) and giving Alstom (respondent No.2) yet another
opportunity to rectify or supplement its admittedly non-responsive fresh
price bids. It was further urged in the Writ Petition that such action on the
part of the appellant was contradictory to the tender conditions, more
particularly, Clause 25.3 of the Instructions to Bidders (ITB), which
prohibited a non-responsive bid from being made responsive at the
instance of the bidder by introducing corrections or withdrawing the non-
conforming deviation or reservation. It was also urged that in inviting the
fresh pricing bids, the provisions of the bidding documents were selectively
changed and had resulted in reopening techno commercial bids after the
price bids of both the respondents had been opened and evaluated. It was
further urged that after passing of the judgment dated 26.3.2010 by this
Court, the scope of the Panel of Experts was restricted, in the sense that it
could only examine the price bid by Alstom (respondent No.2) and could
not go into the merits of the bid given by Voith GMBH (respondent No. 1).
On that basis, it was urged in the Writ Petition that once the techno
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commercial bid of Voith GMBH (respondent No. 1) was finally accepted,
there was no question of introducing the subject of deviations and then
insisting upon the compliance with those deviations and thereafter, inviting
fresh price bids. Strong words like ‘bias’, ‘discrimination’, ‘nepotism’ and
‘fairness’ have also been used in the Writ Petition. In short, the actions on
the part of the appellant have been interpreted to be with the sole objective
to confer benefit to Alstom (respondent No.2) to the detriment of Voith
GMBH (respondent No. 1). It was further urged in the Writ Petition that
once Envelope Nos. 3 and 4 were opened and evaluated, there was no
provision in any of the bidding documents permitting the appellant to revisit
or reopen or reconsider the technical bid contained in Envelope No. 3.
Referring to the earlier correspondence and various letters by the
appellant, as also the contents of various documents, it was contended
that the appellant was stopped from contending to the contrary. It was
suggested that after the judgment dated 26.3.2010 passed by this Court,
the only course left open to THDC (appellant herein) was to proceed
further and award contract to Voith GMBH (respondent No. 1 herein) in
view of Clause 28.1 of ITB. It was urged that THDC (appellant) ought to
have abided by the observations made by the Panel of Experts in their first
report dated 8.2.2010. Contentions were also raised about the bidding
process as also ITB.
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17. It is obvious that the High Court, on the basis of this plea, as also the
plea of non-supply of the necessary documents, chose to stay the whole
process after hearing both the sides.
18. We have intentionally chartered the whole course of this tender,
which began in August, 2007. When the matter came for the first time
after the final judgment of the High Court was passed, requiring the
appellant THDC to invite fresh price bids, it was felt by this Court that the
legal battle between these two multi-national companies was resulting in
delaying of the whole process. The importance of the project as also the
tremendous financial implications, were realized. The project undoubtedly
was going to cause very heavy expenditure on the part of THDC
(appellant). It was in that spirit that this Court proceeded to pass the
judgment and order dated 26.3.2010, and it was, therefore, that the price
bids were directed to be given before the officer of this Court. The
monetary implications were tremendous and, therefore, this Court felt the
need for transparency on the part of THDC (appellant) as also the
objectivity. It was, therefore, directed that the price bids should be got
examined by the Panel of Experts. This was done not only once but twice
to ensure that both the sides should get equal opportunities and treatment
of fairness.
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19. What strikes us initially is that all the arguments and the insistence
for award of contract in favour of Voith GMBH (respondent No. 1) could
have been argued before us in that very first round. That was not done
and even if that was haltingly done, it was not found feasible to
straightaway award a contract in favour of Voith GMBH (respondent No.
1). Considering the national interest, the matter was referred to the Panel
of Experts. Again, it was made very clear that the report of the Panel of
Experts was not going to be be all and end all of the matter. In the last
paragraph of the judgment, it was made very clear that the ultimate
decision regarding awarding of the contract would have to be given by
THDC (appellant) and not by this Court. Therefore, there was enough
discretion and play left in THDC (appellant) to act on the report of the
Panel of Experts and as such THDC could have adhered to its own
procedure and decide upon the award of contract.
20. It was argued before us by the Shri Vahanvati, learned Attorney
General that there are hierarchies in the working of THDC. The report of
the Panel of Experts had to be first analyzed by the Tender Committee and
even the decision of the Tender Committee was not final and the same
was subject to the decisions of the Executive Director and ultimately the
competent authority. It was pointed out by the learned Attorney General
that after the final report of the Panel of Experts came, it was heavily
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deliberated by the Tender Committee. The Tender Committee made a few
comments in terms of the report. The Panel of Experts had already, in
para 8 of its report, expressed what we have reproduced in para 8 of this
judgment. Therefore, even if the bid of Alstom (respondent No.2) was
found to be non-responsive by the Panel of Experts, it was clear that the
ultimate decision was to be taken by THDC after looking into number of
issues. When the matter was considered further by the Tender
Committee, the Tender Committee came to the conclusion which is to be
found in para 12 of the recommendations. This report of the Tender
Committee is dated 2.8.2010. The Tender Committee, under the working
pattern of THDC (appellant), could not have finalized the grant of award. It
could only make the recommendations. It held that the fresh price bids of
Alstom (respondent No.2) were non-responsive. However, it is clear from
the record that the report of the Tender Committee was to be considered at
various higher levels in the hierarchical structure of the decision making of
the appellant. In this report, as pointed out by the learned Attorney
General, the Tender Committee had pointed out certain deviations/non-
conformities in respect of the bid of Voith GMBH (respondent No. 1) also
and, therefore, it had suggested discussion for resolving certain deviations
and price negotiations and had also recommended the award of contract to
Alstom (respondent No.2). All these aspects were bound to be considered
and were actually considered at the higher levels and thereafter the report
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of the Executive Director came. We have already made a reference to the
decision of the Executive Director, who found, by his note dated 8.9.2010,
that the bid of Voith GMBH (respondent No. 1) was also not fully complied
with. It was found that on an impartial and independent scrutiny, the
attitude of THDC (appellant) was found to be too stringent to Alstom
(respondent No.2) and quite lenient to Voith GMBH (respondent No. 1).
The Executive Director had also noted the non-conformities of the bids.
The actual observations have been pointed out and mentioned in para 9 of
this judgment. It was in view of this that the decision was taken on
1.10.2010 by the competent authority to call for fresh bids. The matter was
again examined by the Tender Committee and by its report dated
14.12.2010, the Tender Committee fixed the deviations which were
reported in Annexure 1 A and Annexure 1 B to its report. It is these non-
conformities which were mentioned in the letter dated 21.12.2010. Now, it
was clear that these deviations or non-conformities, as the case may be,
were located and both the respondents were asked to comply with these
deviations/non-conformities with the sole objective of bringing them on the
same level playing field, so that thereafter there would be only one task to
decide as to whose price bid was lower and as such acceptable by THDC
(appellant).
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21. We do not find anything amiss in this whole exercise. Shri Desai,
learned senior counsel appearing on behalf of Voith GMBH (respondent
No. 1), invited our attention to the allegations of bias, discrimination etc. It
cannot be forgotten that at a point of time, the Executive Director felt that in
fact, THDC (appellant) was showing a tilt in favour of Voith GMBH
(respondent No. 1). When the documents and the correspondences are
examined, we do not find any tilt in favour of either party and in our
opinion, there is no scope to accept the allegation that THDC wanted to
favour Alstom (respondent No.2) and had, therefore, changed the rules of
the game. That contention is clearly without any merits. The allegations of
mala fides and bias are directed towards THDC as a whole without naming
any individual person. Such allegations are easy to be made but very
difficult to justify. Precisely that has happened here also. The extremely
general nature of allegations would desist us from accepting the same.
Particularly, when there is hardly any material justifying the same.
22. It has already been pointed out that it is only when all the exercise
was taken in pursuance of this Court’s judgment dated 26.3.2010 that the
respondent No. 1 chose to raise the issue about the non-responsive bid of
Alstom (respondent No.2). It went on with the whole exercise including the
arguments before the Panel of Experts not once but twice and thereafter,
also took part in the negotiations. But its stance changed only after the
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final decision was taken by the competent authority on 1.10.2010 and
more particularly, after the Tender Committee had finalized the report on
14.12.2010.
23. In our opinion, since the whole process was absolutely transparent
and since these issues, which were raised by way of the Writ Petition,
were not even argued before the Court in the first round, there is no scope
to stall the whole process by finding fault with the tendering process and
insisting that THDC could not invite the fresh pricing bids. In our opinion,
in inviting the fresh pricing bids, particularly after conveying the
deficiencies or non-conformities to both the respondents and making it
clear to them that they would have to comply with the same as first stage,
we do not think that any change is being made in the bidding conditions.
We must note, at this juncture, that this Court had left discretion in THDC
to take the decision in the light of Panel of Experts’ report. The Panel of
Experts had gone into the exercise not once but twice. However, the close
examination of the second report of the Panel of Experts would suggest
that everything was not alright even with the bid of Voith GMBH
(respondent No. 1) and there were in fact some non-conformities, which
were required to be considered by THDC before a final decision was
taken. We do not find anything wrong in that. It was earnestly urged by
Shri Desai, learned senior counsel that the unfairness was clear enough
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from the fact that even the documents were not supplied by THDC to Voith
GMBH (respondent No. 1) though they were insisted upon from time to
time. While the debate was going on before us, all the documents were
supplied. But, even otherwise, we do not think that any serious prejudice
would have been caused to Voith GMBH (respondent No. 1) on that
account.
24. We may reiterate at the cost of repetition that by judgment and order
dated 26.3.2010 passed by this Court, this Court had clearly expressed
that the contractual rights of the competing parties like Voith GMBH
(respondent No. 1) and Alstom (respondent No.2) were not more important
than the national interest. If we find that in pursuance of the national
interest, which was so explicitly mentioned in this Court’s judgment dated
26.3.2010, the THDC by adopting a fair and transparent procedure,
provided a level playing field to both the parties to get a proper idea of
costs that it would have to pay to the party winning the contract, no
complaint could be made of the breach of the contractual rights. In our
opinion, firstly, there is no breach of the contractual rights or the terms of
ITB. After all, it could not be said that the rights of the parties were
crystallized. According to Shri Desai, learned senior counsel arguing on
behalf of Voith GMBH (respondent No. 1), the crystallization of the rights
was even prior to passing of the judgment of this Court dated 26.3.2010,
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as the bid of Alstom (respondent No.2) was found to be non-responsive
and the only bid which was found to be responsive was that of Voith
GMBH (respondent No. 1). Even accepting this, Voith GMBH (respondent
No. 1) could not insist upon the grant of contract in its favour on that
ground alone. In the light of peculiar facts of this case, it must be stated
that even if the bid of Voith GMBH (respondent No. 1) was found to be
responsive, that did not end the matter. After all, THDC, which was going
to come out with the huge expenditure running into thousands of crores of
rupees, was bound to safeguard the national interest. That was the tone of
this Court’s judgment dated 26.3.2010 also. Otherwise, this Court could
have straightaway awarded the contract in favour of Voith GMBH
(respondent No. 1). But that was not found feasible in national interest.
Instead, it was found proper to give fair opportunities to both the parties
and it was only with that objective that the matters were referred to the
Panel of Experts. If the facts are viewed from this angle, then it will be
clear that there was nothing wrong in THDC treading its course with utmost
care and it must be said that the facts show that THDC appears to have
acted in favour of the national interest by trying to prevent the exorbitant
prices for the project and further trying to go to the realistic and minimum
price. That was the spirit of this Court’s judgment dated 26.3.2010 too.
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25. In that view, we do not think that the High Court was right in passing
the stay order as it did. This was a clear effort on the part of Voith GMBH
(respondent No. 1) to put the spoke and to bring to halt the motion of the
process which was ordered by this Court in its judgment dated 26.3.2010.
26. Even at the beginning of this judgment, we had pointed out as to
why this Court is interfering against the interim order passed by the High
Court. It is only to save the precious time that we have entertained this
appeal and cleared the obstacles in the whole tendering process.
27. The appeal succeeds. The order of the Uttarakhand High Court
granting stay is set aside. The parties will now proceed to submit their
price bids in the light of the observations made by us. The said price bids
shall be submitted within three weeks from the date of this judgment.
THDC (appellant) shall take the decision in respect of the grant of the
contract within three weeks thereafter. With these observations, the
appeal is disposed of. No costs.
………………………………..J. (V.S. Sirpurkar)
………………………………..J. (T.S. Thakur)
New Delhi; March 17, 2011.
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