TaxTMI 
TaxTMI 
2016 (3) TMI 792
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....g drugs and medicines to the Central Government Health Scheme (CGHS for short) in response to the tenders invited by the said authority for such purpose. The petitioner had, accordingly, supplied the specified drugs during the period between 5.9.2011 to 3.12.2014 when the contract quantity was exhausted. At the relevant time, the petitioner raised the bills for such supply and was also paid accordingly. There is no dispute about either short supply or of the inferior quality of the medicines and drugs supplied by the petitioner. 3. The CGHS floated new tenders on 4.7.2014. The petitioner applied once again for the said tender and was awarded the contract on 18.11.2014 for supplying specified drugs and medicines for Navrangpura area of th....
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.... term in respect of all items of supplies to be made under the Contract. It should be noted that liability to pay Taxes / VAT/ Levy / Cess/ Octroi etc. leviable under the law would be that of the supplier. CGHS will pay the labelled MRP minus local taxes less tendered discount thereon. The quoted offer shall remain valid for the entire duration of the contract." 5. This clause, thus, refers to the liability of paying all taxes being on the supplier. It is clarified that the CGHS will pay the labelled MRP minus local taxes less as reduced by tendered discount and such quoted offer would remain constant during the entire duration of the contract. This, in nutshell, is the pricing clause. According to the respondents, the CGHS would pay the....
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....ner and (iii) the discount offered by the tenderer. It provides that the CGHS would pay the labelled MRP minus local taxes less the discount offered. Such formula would remain constant during the entire period of the contract. This clause is open to two interpretations. One approach could be that the literal language used in the clause refers to the liability of CGHS to pay MRP minus local taxes less discount. There is no distinction between the local tax to be borne by the suppliers and the rest. However, the other interpretation equally possible is that the CGHS would pay the MRP less the tax component of the supplier reduced by the offered discount. 8. For multiple reasons, we are inclined to accept the later interpretation. Firstly, ....
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....rison, we may refer to the current pricing clause introduced by the CGHS in later contracts, which reads as under :- "7. PRICING The bidder should quote uniform discount in percentage terms on the Maximum Retail Price (MRP) (inclusive of all taxes) printed on the strip/ Bottle/ unit packed, in respect of all items of supplies to be made under the Contract. The quoted offer shall be on the MRP inclusive of all taxes and shall remain firm and fixed for the entire duration of the contract." 11. This clause now provides that the bidder would have to offer uniform discount in percentage terms on the MRP (inclusive of all taxes). This clause also provides that such offer shall remain constant during the entire duration of the....