TaxTMI 
TaxTMI 
2018 (9) TMI 2047
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.... 2. Respondent no.1­Maharashtra State Road Transport Corporation (for short "MSRTC") had issued a tender for appointment of an agency for implementation of a "Vehicle Tracking System and Passenger Information System." The petitioner was one of the bidders in the said tender. Respondent no.2-Rosmerta Autotech Pvt.Ltd. was the successful bidder having submitted the lowest bid(L­1). The petitioner interalia prays that the award of the tender in favour of respondent no.2 vide letter of intent dated 16 November 2017, be quashed and set aside, and that a fresh bidding process be undertaken by respondent no.1­MSRTC. 3. The principal contention as urged on behalf of the petitioner is that the bid of respondent no.2 was required to b....
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....e total cost. The petitioner contends that the MSRTC ought not to have entered negotiations with respondent no.2 when principally the bid was contrary to sub­clause (8) of paragraph 7.2. 6. The MSRTC has filed a reply affidavit interalia contending that there was nothing arbitrary in the decision making process in entering into negotiations with respondent no.2 who was the lowest bidder and more particularly in view of the new regime of Goods and Service Tax (GST) which was introduced after the publication of tender notice. It is contended that at the time of submission of the bids and at the time of closure of financial bids, the Goods and Service Tax regime was not in force and the GST rates were unknown to the parties and thus the....
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....l bid price quoted. 8) That after the last date of submission of bids, 27/04/2017, only on 28/06/2017 vide Notification No.11/2017 GST rates were notified. After the respondent No.2 were declared L­1, they were invited for negotiations, so that the tax components of the amount quoted by them could be readjusted to suit the newly introduced GST rates. 9) That pursuant to negotiations a slight revision of prices was allowed in the total CAPEX cost. That the Respondent No.2 had agreed to reduce the Base price of the CAPEX expenses and consequently the only change in prices that occurred was on account of replacement of the currently prevailing tax rates as against the tax rates quoted in the bid, and that too at a substan....
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....negotiation and acceptance of further discount by the L­1 bidder during negotiation can't be considered as a reason for their bid cancellation." 7. On behalf of respondent no.2 it is submitted that the levy of GST was unknown when the tender notice was issued and therefore, the bidders necessarily were required to take into account the GST and the rates so notified by the Government of India in regard to supply which would be undertaken by the successful bidder. Our attention is drawn to a Government Circular dated 19 August 2017 which provides for guidelines on account of implementation of GST from 1 July 2017. It provides that the introduction of GST would change the structure of taxes in the Government contract. Paragraph 3 of....
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....providing that the bidders should take into consideration the Goods and Service Tax rates which would be notified. Thus, the bidders including the petitioner and respondent no.2 were required to take into consideration the said condition of Goods and Service Tax as notified in the corrigendum. As pointed out on behalf of MSRTC and as noted by us above, respondent no.2 being L­1 being lowest bidder was entitled to negotiate in regard to the lowest bid offered by it and more particularly on taking into consideration the Capital Expenditure cost (CAPEX) and Operational Expenditure Cost (OPEX). The MSRTC has found that the petitioner has appropriately applied the GST in the manner in which it would be beneficial to MSRTC. Respondent no.2 in....