In the legal proceedings between Level 9 BIZ Pvt. Ltd. and HIMUDA, concerning irregularities in the tender process, the High Court has made significant decisions. The court ordered the cancellation of the initial tender process due to malafide actions and collusion between HIMUDA and respondent no.2. Stay informed about the latest developments and the consequences of the independent committee’s findings.
Facts
- The Appellant, Level 9 BIZ Pvt. Ltd., was not a party to the proceedings initially.
- Various Government departments/PSUs are facing a shortage of office accommodation.
- The Appellant filed a petition praying for the rejection of the Technical and Financial Bids of Respondent No.2.
- The Court granted a stay of operation of the impugned order dated 18.10.2022 when the SLP was filed.
- The High Court disposed of the CWP filed by Respondent No.2 by accepting statements made on behalf of both parties, allowing the project to proceed on initial terms and conditions.
- A committee confirmed irregularities in the tender process, leading to the cancellation of the initial tender.
- The respondent No.2 was initially declared qualified in the Technical and Financial Bids.
- An independent committee was appointed to review the alleged illegalities and irregularities in the tender process.
- High Court observed that some officials in HIMUDA did not act responsibly and attempted to give undue benefit to contractors.
- Technical bids were opened and financial bids were also opened on the same day.
- A committee concluded that both bidders were not technically qualified, leading to the cancellation of the tender.
- LOI was issued to one of the bidders but later withdrawn by HIMUDA.
- High Court directed the initiation of separate proceedings against the erring officials.
- An independent committee appointed by the High Court found irregularities and illegalities in the tender process.
- The initial tendering process was cancelled by HIMUDA in view of the irregularities.
- Another committee found that one bidder was not qualified while the other was qualified.
- A detailed order was passed by the High Court in CWP No 3021/2018 and 363/2019.
- The High Court ordered transparency in the system and constituted an independent committee to inquire into the tender process.
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Analysis
- The Committee appointed by the High Court recommended actions against officers but failed to fix responsibility.
- Separate proceedings to be initiated for ensuring compliance of recommendations and for initiating criminal or departmental proceedings against erring officials.
- All three parties involved in the original tender should have been given the opportunity to negotiate.
- The Letter of Intent (LOI) is not a binding contract, it is merely an expression of intention to enter into a contract.
- An detailed agreement/contract is required to be drawn up after receiving the LOI, especially for a mega-scale project.
- The Executive Engineer stated before the Division Bench that the cancellation of the initial tender process was to be withdrawn, even though the same had been cancelled by the High Court.
- The actions of colluding with the second party to misuse the court’s order for awarding the contract were evident.
- The misuse of the legal process to cover up irregularities and illegalities in the tender process was blatant.
- Order passed without proper application of mind and without assigning cogent reason
- Impugned order brushed aside findings of Independent Committee and Single Bench
- HIMUDA acted malafide and in collusion with respondent no.2
- High Court failed to notice ill-intentions of HIMUDA and respondent no.2
- High Court permitted them to go ahead with original tender despite irregularities and illegalities
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Decision
- Registry directed to register separate proceedings and list them on 17.3.2021.
- Parties reserved the liberty to file fresh petitions if still aggrieved.
- Counsel for petitioners satisfied with enquiry committee findings and suggestions.
- Petitioners not willing to prosecute cases further, prayed for disposal as infructuous.
- Both petitions disposed of as infructuous along with pending applications.
- Interim directions, if any, stand vacated.
- Impugned order passed by High Court set aside.
- Respondent No.1 cancelled tender in view of High Court order, but can initiate a fresh tender process.
- Appeal allowed with cost of Rs. 5,00,000 to be deposited by HIMUDA with Supreme Court Advocates-on-Record Association within two weeks.
- Order dated 25.9.2020, judgment, and enquiry report to be part of fresh proceedings.
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Case Title: LEVEL 9 BIZ PVT. LTD. Vs. HIMACHAL PRADESH HOUSING AND URBAN DEVELOPMENT AUTHORITY (2024 INSC 257)
Case Number: C.A. No.-004626-004626 / 2024
