Supreme Court of India
POOJA CERATECH PRIVATE LIMITED versus OIL AND NATURAL GAS CORPORATION LTD. & ANR. on 3 December 2021
POOJA CERATECH PRIVATE LIMITED
v.
OIL AND NATURAL GAS CORPORATION LTD. & ANR.(Special Leave Petition (C) No. 19006 Of 2021)
DECEMBER 03, 2021
[ M. R. SHAH AND B. V. NAGARATHNA, JJ]
Tender: Tender process – Security interest deposit – Forfeitureof – Bidder participated in the tender process – Bidder soughtpermission to modify his price bid on the ground of mistake committedin offering the price – Howver, the bidder disqualified – Corporationthen decided to invoke the bank guarantees furnished by the biddertowards the security interest deposit invoking clause 14.5(b) of thetender document – Writ petition by the bidder challenging thedecision of the Corporation to forfeit the security interest depositby invoking the bank guarantees – Writ petition dismissed by theHigh Court holding that in a contractual matter, the writ petitionu/Art. 226 not maintainable – Correctness of – Held: High Courtjustified in dismissing the writ petition – As per Clause 14.5 of thetender document, the security deposit submitted by the bidders wouldbe forfeited by the Corporation in the event bidder varies or modifiesthe bid in a manner not acceptable to ONGC during the validityperiod or any extension thereof duly agreed by the bidder – Actionof the Corporation in consonance with the terms and conditions ofthe tender document – It cannot be said that it was not a case ofmodification of the bid but an arithmetical error in calculation whichwas sought to be corrected – Furthermore, the request formodification/variation of the bid offer was made during the validityperiod, thus, clause 14.5(b) of the tender document applicable – Inview thereof, order passed by the High Court upheld.
Kailash Nath Associates Vs. Delhi DevelopmentAuthority and Anr. (2015) 4 SCC 136 – referred to.
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ACIVIL APPELLATE JURISDICTION : Special Leave Petition(C) No.19006 of 2021.
From the Judgment and Order dated 27.07.2021 of the High Courtof Gujarat at Ahmedabad in Special Civil Application No.3569 of 2020.
Malak Manish Bhatt, Ms. Neeha Nagpal, Vijay Patel, AnubhavBTaneja, Advs. for the Appellant.
Ajay Jain, Jinendra Jain, Ms. Tannu, Ms. Mitika Choudhary, Advs.for the Respondents.
The Judgment of the Court was delivered by
M. R. SHAH, J.C
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1. Feeling aggrieved and dissatisfied with the impugned judgmentand order dated 27.07.2021 passed by the High Court of Gujarat in SpecialCivil Application No.3569 of 2020 by which the High Court has dismissedthe said writ application preferred by the petitioner, the original writpetitioner has preferred the present special leave petition.D2. The respondent – Oil and Natural Gas Corporation Limitedissued a tender notice for sale of gas. That the writ applicant participatedin the tender process by offering its bid. The petitioner received an e-mail on 29.11.2019 from one of the officers of the Corporation informingthat upon evaluation of the technical bids on 17.09.2019, the price bidswere to be opened on 03.12.2019 at 03.00 PM. That the petitionerErequested the Corporation to permit him to modify his price bid on theground that he has committed a mistake in offering the price. Initially, itwas decided to postpone the opening of the price bids, however, theCorporation thereafter decided to open the price bids in absence of thewrit petitioner. That thereafter the Corporation disqualifying the writFapplicant, decided to invoke the bank guarantees furnished by the writapplicant towards the security interest deposit invoking clause 14.5(b)of the tender document. The writ applicant challenged the decision ofthe Corporation to forfeit the security interest deposit by invoking thebank guarantees. The writ petitioner preferred writ petition before theHigh Court under Article 226 of the Constitution of India. By the impugnedGjudgment and order, the High Court keeping the question “whether in acontractual matter, the writ petition under Article 226 of the Constitutionwill be maintainable or not?” considered the matter on merits and hasdismissed the writ petition, which has given rise to the present specialleave petition.H
3. We have heard Shri Malak Manish Bhat, learned Advocateappearing on behalf of the petitioner.
4. Shri Bhat, learned Advocate appearing on behalf of the petitionerhas heavily relied upon the decision of this Court in the case of KailashNath Associates vs. Delhi Development Authority and Anr.,(2015) 4 SCC 136 and has submitted that as held by this Court andconsidering Section 74 of the Indian Contract Act unless there is a losscaused and/or established and proved, there is no question of forfeitingthe security deposit. It is submitted that the purpose of security depositis to secure the payment after entering into the contract and during thecontract there is any failure on the part of the contractor to fulfill his partof the contract.
5. Having gone through the decision of this Court in the case ofKailash Nath Associates (supra) and considering the relevant clauseof the tender document, more particularly, Clause 14.5, we are of theopinion that the action of the Corporation is absolutely in consonancewith the terms and conditions of the tender document. As per Clause14.5, the security deposit submitted by the bidders shall be forfeited bythe Corporation in the event…… “bidder varies or modifies the bid in amanner not acceptable to ONGC during the validity period or anyextension thereof duly agreed by the bidder”.
6. Then it is submitted that it was not a case of modification of thebid but it was only an arithmetical error in calculation which was soughtto be corrected. The aforesaid is factually not correct. In thecommunication dated 03.12.2019, it is submitted that there was amisunderstanding in the price calculations of the bidding price.
7. Then it is next submitted that even the offer was not variedduring the validity period. However, it is required to be noted that the lastdate of submitting the tender was 17.09.2019 and the opening date was17.09.2019. The request for modification/variation of the bid offer wasmade on 03.12.2019. Therefore clause 14.5(b) of the tender documentshall be applicable.
8. No error has been committed by the High Court in dismissingthe writ petition, hence this special leave petition is dismissed.
Nidhi Jain
Petition dismissed.
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