The Rajasthan High Court has held that the procuring entity and first appellate authority cannot be the same in municipal corporation tenders and set aside the tender on apprehension of bias.
Yashi Consulting Services Pvt. Ltd, the petitioner prayed that an order or direction may kindly be issued while holding that Respondent No.4 is disqualified due to non-deposit of the EMD in breach of condition no. 3.5 of the Request for Proposal;
Respondent No.2 issued a Request for Proposal on 12.05.2023 through respondent No.3 inviting tenders for implementing the GIS-Enabled Cloud based on Property Tax Information Management System (‘PTIMS’) for five years.
The petitioner as well as respondent No.4 participated in the above tender process and respondent No.4 was declared as lowest bidder No.1 while the petitioner was declared as lowest bidder No.2. The bid submitted by respondent No. 4 was accepted by respondent Nos. 2 and 3 in violation of the terms and conditions.
The petitioner submitted the first appeal under Section 38 of the Rajasthan Transparency in Public Procurement Act, 2012 ( ‘the Act of 2012’). Counsel submitted that the procuring entity was Deputy Commissioner (Development), Ajmer Municipal Corporation, Ajmer (‘the Deputy Commissioner’) and as per Annexure-C, attached with the tender document, the First Appellate Authority was designated as the Deputy Commissioner.
It was argued that the respondents had committed an error by designating the Deputy Commissioner as the First Appellate Authority and the Commissioner, Ajmer Municipal Corporation, Ajmer as the Second Appellate Authority.
Per contra, counsel for the respondents opposed the arguments raised by the counsel for the petitioner and submitted that without availing the alternative statutory remedy of filing a second appeal under Section 38(4) of the Act of 2012, the petitioner has approached this Court by way of filing this writ petition under Article 226 of the Constitution of India.
“It is quite surprising that the procuring entity/authority is the same as the First Appellate Authority i.e. the Deputy Commissioner. It is the well-settled proposition of law that the procuring entity and the First Appellate Authority cannot be the same, though the orders in this regard were passed by the Department of Local Bodies way back in the year 2019 by issuing an order dated 12.06.2019, wherein, the First and Second Appellate Authorities were designated as the Director, Department of Local Bodies and the Secretary, Department of Local Bodies respectively.”, the bench viewed.
It was observed that “Since the respondents have rectified their mistake by writing a letter to the petitioner that the First Appellate Authority is the Director, Department of Local Bodies, the petitioner is directed to file a statutory appeal under Section 38 of the Act of 2012 before the Director, Department of Local Bodies alongwith an application under Section 39 of the Act of 2012. If such an appeal is submitted before the Director, Department of Local Bodies within ten days from today, the First Appellate Authority i.e. the Director, Department of Local Bodies is expected to hear and decide the appeal after affording due opportunity of hearing to all the respective parties including respondent No.4 strictly by law and expeditiously as early as possible preferably within 15 days thereafter filing of the appeal.”
A single bench of Justice Anoop Kumar Dhand held that “the First Appellate Authority is expected to decide the said appeal filed under Section 38 of the Act of 2012 and the stay application filed under Section 39 of the Act of 2012 by law after hearing arguments of all sides.”
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