TaxTMI 
TaxTMI 
2006 (12) TMI 521
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....'Expression of Interest for development of C&EC'. Appellant No. 1, pursuant whereto and in furtherance whereof, entered into a Memorandum of Understanding (MoU) with M/s. Larsen & Toubro Ltd. (L&T) for setting up such a complex. It also conducted conference of investors therefore. It submitted its tender on 7.4.2003, highlighting: a) Entire ground of 75,000 sq.m. would be required for international standard C&EC. b) They have formed a consortium for bidding for the said project and giving the names of the members of the consortium as including L&T and IMAG (Germany). c) Letters of acceptance from L&T was also annexed to show its participation. d) The Authority was offered equity participation to the extent of 5% of the total equity base. Several other companies also submitted their tenders. 3. The tenders were to be considered at three stages and thus, three different covers were to be submitted along with tenders. The first cover contained compliance with minimum eligibility criteria, the second cover contained financial bid and the third one contained technical and business proposals. The technical bid was opened on 7.5.2003. The ....
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.... Mumbai inspite of reserved plot (restricted utility) area with high gestation period and longest break even which is almost about 7 years. In all, the project starts getting yield only after 12 years from date of commencement of construction. (ii) It has also been the contention of the company to relocate the asset base of the company on account of core competency of the company in the field for more than 50 years and intending to continue to command on industry. iii) As per the press release for a commercial block bidding invited by the Authority, it was awarded at Rs. 25,000/- per square meter in spite of having a total flexibility to exploit the commercial aspect vis-a-vis an offer given by the company for the reserved plot for convention center at the rate of Rs. 14,642/- per square metre. iv) Company also expressed that the projects of such type are always being given land at very concessional rate. Statistics indicates that world over such exhibition centers are either funded by way of concessional land price or absolute government contribution by way of land to make the project to early break even. 7. The expertise of L&T and IMAG in setting up....
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....ercise of the powers under Article 226 it could not act as an Appellate Authority to review of supervise the functions of authorities like the Mumbai Metropolitan Region Development Authority. E. Considering the material on record it cannot be held that the Authority acted unreasonably unfairly or in an unjust manner. F. The Authority consisting of people possessing expertise and skill in the field its decision to develop the property as a C&EC by itself cannot be faulted with. G. It is not a case where Article 14 can be said to have been infringed. H. It cannot be said the facts which are pleaded are not based on evidence or materials which are not annexed to the counter affidavit. I. Reasons in such matters can be gathered from files/records maintained by the authorities. A review petition filed there against was dismissed. Appellants filed the special leave petition on 29.10.2004 against the order dated 20.1.2004 as also against the order dated 11.10.2004 dismissing the review petition. 10. In its counter affidavit filed before this Court the Authority, inter alia, disclosed that the rate of premium for the commercial propert....
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....t he would also pay the amount at one go instead of paying it over a period of time. We are informed that there is another party who is involved. Mr. R.F. Nariman, the learned senior counsel, states that the petitioner would move an application to implead that other party (Reliance Industries Limited). The Reliance Industries Limited was impleaded as a party to this appeal thereafter. 11. Mr. R.F. Nariman, learned Senior Counsel appearing on behalf of Appellant in support of this appeal would contend that - i) the purported major shift in the policy by the Authority was impermissible in law; ii) rejection of the bid offered by the Authority was wholly illegal as the Executive Committee alone was the sole judge in relation thereto; iii) in accepting the bid of Reliance Industries Ltd., the offer of the appellants that they would pay @2 1/2% per year from the annual turnover from the 21st year had not been considered; iv) in rejecting the tender of the appellant, the Executive Committee/Mumbai Metropolitan Region Development Authority was required to assign sufficient and valid reason; and the same having not been done, the order imp....
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....tions are as under: 7. Disposal of land by offers to Government, Local Authority or Public Sector Undertaking Where the Authority determines to dispose of land by making offers to the Government, Local Authority or Public Sector Undertaking, the offers shall be made by the Metropolitan Commissioner in such form as he may decide, incorporating the terms and conditions of offers determined by the Authority which shall include the condition that the offer shall remain open and valid for acceptance for a period of 30 days and shall lapse if it remains unaccepted by the expiry of this period; provided that it shall be lawful for the Metropolitan Commissioner to renew any lapsed offer on an additional condition that the Government, Local Authority or Public Sector Undertaking, as the case may be, shall pay interest at the rate of 18% per annum over the premium specified in the lapsed offer with effect from the date on which the lapsed offer was made; provided further that nothing contained herein shall authorize the Metropolitan Commissioner to renew any lapsed offer after three months of its lapse. Regulation 9 provides for the mode and manner of payment of premium.....
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....st Bidders who have: * The financial strengths necessary to contribute and/or arrange the funds required to execute the Project in the desired time frame. * The technical skills necessary to design, construct, operate and maintain the Facility as per the Principles of Good Industry Practice. * The commercial skills necessary to market the Facility and successfully develop business. Clause 7.17 provides for the eligibility criteria being: * "Tangible Net worth not less than Rs. 750 Million as per the latest audited financial statement. * Annual turnover not less than Rs. 500 Million as per the latest audited financial statement. * Net Profit not less than Rs. 50 Million as per the latest audited financial statement or Average annual net profit of the last three financial years not less than Rs. 50 Million. Category "I", related to field of activity defined as Convention & Exhibition centers, Hotels, Restaurants and Banquet Halls. 17. Clause 7.22 provides for Category "II" to include an indirectly related field of activity defined as shopping centers, commercial complexes, housing or office complexes, retail stores,....
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....clarifications and make suggestions in respect of the proposal, within the permitted built-up area, which will not include any change in the premium or the manner in which it is to be paid. These suggestions will have to be incorporated by the bidder. The Bidding Companies/Bidding Consortium of Appellants included: 1. M/s. R.M. Bhuther & Co. Ltd. 2. M/s. Larsen & Toubro Ltd. 3. M/s. R.M. Bhuther & Co. 4. M/s. M.B. Development Corporation 5. M/s. M.B. Constructions 6. M/s. Bhattad Bros. 7. M/s. Alusett System (India) Pvt. Ltd. The principal question which arises for consideration is as to whether the Authority had any jurisdiction to cancel the bid. 18. The Executive Committee is a statutory functionary. The powers and functions of the authority and the respective committees concededly are governed by the provisions of the statute, but, then the jurisdiction of the Executive Committee is limited. It was confined to rejection or acceptance of the tender. The Authority exercises a larger power. For the said purpose we would assume that the Authority had no incidental or ancillary power, but there cannot be any dou....
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.... against both the officers is commensurate with the defaults and allegations proved against both the officers; and (iii) The Executive Council, therefore, wholly, endorses the actions taken by the then Vice-Chancellor against both the officers. By this resolution, we are told that the Executive Council has ratified the action taken by the Vice-Chancellor. Ratification is generally an act of principal with regard to a contract or an act done by his agent. In Friedman's Law of Agency (5th edn.) Chapter 5 at p. 73, the principle of ratification has been explained: What the 'agent' does on behalf of the 'principal' is done at a time when the relation of principal and agent does not exist: (hence the use in this sentence, but not in subsequent ones, of inverted commas). The agent, in fact, has no authority to do what he does at the time he does it. Subsequently, however, the principal, on whose behalf, though without whose authority, the agent has acted, accepts the agent's act, and adopts it, just as if there had been a prior authorisation by the principal to do exactly what the agent has done. 21. As noticed hereinbefore, we have p....
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.... tender was not in pari material with 2002 tender. The comparison of methodology for evaluation of bids is as under: 2005 TENDER 2002 TENDER METHODOLOGY FOR EVALUATION OF BIDS 7.30 The bidder will have to quote separately for the Convention & METHODOLOGY FOR EVALUATION OF BIDS 7.30 The bidder will have to quote separately for the C&EC and the Exhibition center and the Commercial Complex. The built-up area (considered for FSI computation) of the Convention & Exhibition center shall be considered as 65,000 sq.m. irrespective of the reduction that may be possible on finalization of detailed architectural designs. Similarly the floor space considered for FSI computation for the commercial Complex will be 50,000 sq.m. The bidder will have to quote a fixed rate of Rs. 20,000 per sq.m. of built up area for total built-up area 65,000 sq.m. for Convention & Exhibition center. The amount will be Rs. 130 crores. The bidder will also have to quote a rate of premium higher than Rs. 70,000 per sq.m. of built-up area for 50,000 sq.m. of total built-up area for Commercial Complex. The premium amount will be higher than Rs. 350 crores. The total minimum amount of lease premium to be ....
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.... rule can be laid down therefore. Recently, in Noble Resources Ltd. v. State of Orissa and Anr. AIR2007SC119 this Court has noticed the power of judicial review vis-a-vis contractual disputes, opining: Although terms of the invitation to tender may not be open to judicial scrutiny, but the courts can scrutinize the award of contract by the Government or its agencies in exercise of their power of judicial review to prevent arbitrariness or favouritism. [See Directorate of Education and Ors. v. Educomp Datamatics Ltd. and Ors. AIR2004SC1962 ]. However, the court may refuse to exercise its jurisdiction, if it does not involve any public interest. Although the scope of judicial review or the development of law in this field has been noticed hereinbefore particularly in the light of the decision of this Court in ABL International Ltd. (supra), each case, however, must be decided on its own facts. Public interest as noticed hereinbefore, may be one of the factors to exercise power of judicial review. In a case where a public law element is involved, judicial review may be permissible. Noticing some of the areas where judicial review would be permissible, this Court o....
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....has been placed on Bangalore Medical Trust v. B.S. Muddappa and Ors. [1991]3SCR102 . This Court therein was dealing with a master plan in the light of justifiability of exercise of discretionary jurisdiction under the Town Planning Act. Having regard to the provisions contained in Sub-section (4) of Section 19 of the Bangalore Development Authority Act, 1976 as also the fact that the discretionary jurisdiction had been arbitrarily exercised, this Court invoked the 'public trust doctrine' saying that although the State is required to keep a vigil on the local body, but, thereby the power thereunder cannot be stretched so as to entitle the Government to alter any scheme and convert any site or power specifically reserved in the statute in the Authority. 28. By floating a tender in furtherance of a public project, the Authority was not truly concerned with the enforcement of its master plan. No such argument was advanced before the High Court. Such an argument has been advanced for the first time before us. We would consider the efficacy of said contention a little later. 29. The next question which arises for consideration is as to whether any reason was required to be ....
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....It had set up its Evaluation Committee. The decision presumably has been reached by experts. The reasons as regards purported unsatisfactory performance of Appellants, take a back seat once having a re-look to the entire situation was thought of. 32. It is not a case where the Court is called upon to exercise its equity jurisdiction. It is also not a case where ex facie the policy decision can be held to be contrary to any statute or against a public policy. A policy decision may be subjected to change from time to time. Only because a change is effected, the same by itself does not render a policy decision to be illegal or otherwise vitiated in law. 33. In Harminder Singh Arora v. Union of India an Ors. [1986]3SCR63 , whereupon Dr. Singhvi relied upon, the tender was arbitrarily rejected. Therein the writ petition was dismissed in limine only on the premise that the question involved therein related to contractual obligations and the policy decision could not be termed as unfair or arbitrary. It was opined that therein no question of policy decision arose and as such contract was to be given to the lowest bidder in terms of the tender notice and the contract should have been....
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.... highest. If, in view of the change in the policy decision, the Authority does not intend to become a partner in the profit making and opt for having the entire bid amount at one go instead of waiting for 20 years, we do not find any fault therewith. 36. Before us comparative bids of the bidders have been placed on the second tender, which are as follows: SR. No. Name of the Bidder Bid Amount Rs. Rate per sq. m. (approx.) Rs. 1. Reliance Industries Ltd. 11,04,00,00,111 96000 2. DLF 1 050 crores 91304 3. Reliance Communications & Infrastructure Ltd 1011.12 crores 87913 4. Gammon India 1011 crores 87913 5. EMAR 911.07 crores 79217 The comparative statistics reads as under: 1. Rate offered by the Petitioners Rs. 91.514 crores (divided by) 75,500 sq.mtrs. Rs. 12,121 per sq. mtrs. 2. Rate expected by MMRDA Rs. 25,000 per sq.mtrs. 3. Amount for 75,500 sq. mtrs @ Rs. 25,000/-per sq.mtrs. (This should have been the minimum bid in 2003) Rs.188.75 crores 4. Amount for 1,15,000sq.mtrs @ Rs. 25,000/-per sq.mtrs. (This would have been the reserve price at old rate in 2005) Rs.287.50....