 "Madras High Court dismisses Thyssenkrupp's peititon against TANCEM")
The Madras High Court has dismissed a petition filed by Thyssenkrupp Industries India seeking to quash an order by the Tamil Nadu Cements Corporation Ltd (TANCEM) issuing execution of a project to L&T Constructions to expand the government-run Ariyalur Cement Factory.
According to the argument of Thyssenkrupp, the company has submitted a bid for Rs 702.68 crore and later approached the authorities claiming that there was a mistake in calculation and the proper calculation is Rs 678 crore. It alleged that the Corporation refused to accept the corrected version later when the company approached and if the error was permitted to be corrected, the lump sum price offered by the company will be the lowest one than that of L&T.
The Corporation has initiated action for expansion of Ariyalur Cement Unit from the existing 0.5 Million Ton Per annum (MTPA) to 1 MTPA Clinkerisation by effecting advertisement in newspapers on January 20, 2015. The bids were submitted and opened, and, according to the company, it has submitted the corrections related to the error in calculation, with the concerned authorities. However, the corporation has sent a letter dated January 18, 2016 declaring Thyssenkrupp as L2 and returned the Bid Security Bank Guarantee, selecting L&T as L1, alleged Thyssenkrupp in its petition.
Read more from our special coverage on "THYSSENKRUPP"
According to the senior counsel for Thyssenkrupp,if the error is permitted to be corrected, the lump sum price offered by it will be the lowest one than that of the L&T.
Advocate General A L Somayaji, who appeared for TANCEM argued that the bids were opened on September 7, 2015, at the presence of representatives from both the companies and the representative of Thyssenkrupp accepted their status as L2 by signing the tender register and left without raising any objection. After 50 days of opening of price bid, the company came with a claim that there were certain calculation error in 13 columns out of 20 but it was was not brought to the notice of the tender scrutiny committee during the price bid meeting.
Apart from the price bid, the Corporation has considered several other factors which led to the awarding of contract in favour of L&T, including that the period of project completion quoted by Thyssenkrupp is 26 months, whereas L&T has indicated as 24 months which is more advantageous to the corporation, he added.
More From This Section
Senior Counsel appeared for L&T opposed the writ petition and alleged that the petitioner company was not diligent enough in quoting their price bid accurately and has claimed that there were some mistakes in the bid quoted by them only after 50 days of opening of the price bid. Therefore, the petitioner is estopped from filing the present writ petition, it added.
The TANCEM informed the Court that even though the machinery requirement of the corporation has been met by both the companies, there is a difference and distinction in the fuel savings and power savings offered by them. As per the quotation of Thyssenkrupp, they have indicated fuel savings of 2 Kcal/Kg of clinker and power savings of 0.5KW/hour/ton of cement, while L&T has offered a more advantageous quote. The Advocate General argued that this is only a tip of the ice berg and there are more and more instances to be quoted from the bids submitted by the compan ies which weighed in the decision of the corporation to take a call.
Hearing the arguments, Justice R Subbiah said, "I find considerable force in the said submission of the learned Advocate General appearing for the corporation. The above aspects relating to power savings or fuel savings or other requirement have to be determined by experts in the field and this Court does not possess any expertise or technical know how relating to the same."
"This Court, in exercise of jurisdiction under Article 226 of the Constitution of India, can only confine it's judicial review as to the procedure contemplated in arriving at a decision transparently without any bias. As mentioned above, the petitioner has not raised any plea relating to bias or mala fide while so, this Court hesitate to interfere with the decision of the Corporation," added the Judge.