A. Muhamed Mustaque JUDGMENT
A. Muhamed Mustaque, J.
1. This writ petition is filed by the association of Government Electrical Contractors registered with the Public Works Department. They approached this Court, aggrieved by the stipulation in e-tender floated by the PWD for construction of the hospital block building of the Government Medical College, Palakkad. The grievance of the petitioner is that, tender has been floated in composite manner without bifurcating civil and electrical components of the contract. The case of the petitioner is that, contractors are having separate registration for civil work as well as electrical work. The registration to undertake the work on behalf of PWD is a mandatory requirement and any proposal to award composite work is in violation of PWD Manual as well as the judgment of this Court, produced as Ext. P5 and relevant Government Order.
2. The petitioner challenges Ext. P4 Government Order as well. By Ext. P4 Government Order, Government relaxed the conditions in the PWD Manual. The reason for revision in PWD Manual can be seen from the Government Order itself. It has been found by the Government that, as per the stipulation in the tender procedure, bids are open to all contractors registered with the PWD or recognized organization under the State Government or Government of India and they do not cater for execution of works through turnkey projects. Government, therefore, acted upon the proposal of Chief Engineer to revise the PWD Manual.
3. The proposal of the Chief Engineer is referred to in Ext. P4 Government Order, which is as follows:
"However, for projects to be taken up as turnkey projects, established and experienced firms which satisfy the conditions specified in the bidding document can participate in the bidding process even though they do not have a valid registration in the State Public Works Department."
4. The petitioner's arguments are two fold: firstly, the petitioner points out the importance of registration under the PWD. According to the petitioner, this creates an accountability to the contractor with PWD or with such agencies, with which contractors are having registration. This is, according to the petitioner, to ensure the quality of work to be undertaken by the contractors. Therefore, doing away with the registration, the quality of the work will have to be sacrificed. Secondly, this would give a monopoly to civil contractors and will not give a chance to the electrical contractors to participate in the tender. The learned Senior Counsel submits that civil contractors will be able to do both civil works as well as electrical works. The petitioner relied on the judgment of this court in W.P.(C) No. 30556/2009, produced as Ext. P5.
5. This Court, as per the judgment in the above case, directed the Government to consider the grievances highlighted by the electrical contractors. Petitioner points out that, thereafter, Government, by Ext. P6 order, separated schedule of works for awarding both civil as well as electrical works and ordered that composite tenders would have a separate schedule as above and if contractors are having civil and electrical licence, they can bid for both civil and electrical works in the composite tender. However, it was made clear that, contractors, having licence only for one of the components, can participate in tender, in which they have licence. Thus, by the above Government Order, award is based on separate bid for civil and electrical work.
6. It is to be noted that, Ext. P5 judgment or Ext. P6 Government Order has no relevance in the matter. The above judgment and Government Order would only apply in respect of the work for which registration is prerequisite. In this case, the Government has treated works costing more than Rupees Fifty crores as turnkey project. In paragraphs 4 and 5 of the counter, it is stated as follows:
"It is not correct to say that, under a turnkey project, no registration is required. Under Clause 3.2.5 of Notice Inviting Tender (NIT), it is mandatory that the intending tenderer has to submit the registration details as a construction contractor in any of the concerned Central or State Government Department. Further, all the requirements applicable to Government contracts are also made mandatory in this tender. It is true that the tender was not restricted to the contractor who is having registration with Kerala PWD alone for the reason that if the same is restricted in such a way, the department will not be able to find out competitive tenders who are capable to execute the work as the magnitude of the work is very high. In the instant case, the total estimated cost of the tender call is more than Rs. 310 crores.
It is also a fact that all types of licence and statutory obligations are made mandatory for executing for work in this tender especially for electrical works and other service items. The successful contractor or his sub-contractor shall possess valid licences from electrical inspectorate for executing the electrical works in this project."
7. The reason for revising PWD Manual, it appears, is on a laudable ground to attract qualitative bidders globally. It seems PWD and Government have found that contractors, who are having global repute, are not participating in the tender for want of registration. Therefore in order to encourage such contractors, Government decided to do away with the mandatory registration for participating in turnkey projects. The Government wants to have participation of highly competent contractors in taking up big projects under the Government. It is to be noted that, in these tenders also, eligibility criteria has been prescribed for intending tenderers to participate. Therefore, the only question now remains to be considered is whether such classification of the tenders for award of the work is legally correct or not.
8. Article 14 of the Constitution does not forbid reasonable classification for the purpose of legislation or Governmental decision. However, in order to sustain permissible classification, two conditions must be fulfilled, namely; (i) that the classification must be founded on an intelligible differentia which distinguishes persons or things that are grouped together from those that are left out of the group, and, (ii) that the differentia must have a rational relation with the objective sought to be achieved by the action in question. Therefore, the validity of classification must be adjudged with reference to the purpose of law or decision of the Government (see Budhan Choudhry and another v. State of Bihar [MANU/SC/0047/1954 : AIR 1955 SC 191], State of Kerala and another v. N.M. Thomas and others [MANU/SC/0479/1975 : AIR 1976 SC 490] and Deepak Sibal and another v. Punjab University and another [(1980) 2 SCC 145].
9. The object of the turnkey project is for attracting contractors who are having national repute or global repute. That does not mean that any contractor registered with PWD or State Government cannot take part in the bid. It is to be noted that only those contractors, who have experience in executing both civil and electrical contract works alone, can participate in such tender. The execution of the successful similar work is one of the eligibility criteria for awarding such contract.
10. Therefore this Court is of the view that, there is reasonable classification for awarding such works. The object of such decision is only to ensure that highly competent and reputed contractors should take part in the tender awarded by PWD. Since the classification is based on sound legal reasons, the court cannot interfere with such classification. The court cannot direct PWD or the Government to award civil work as well as electrical work, separately. The Government found that, highly reputed contractors would not take part in such contract work, if the components of the work are separated. Therefore, awarding contract for high value work in a composite manner cannot be found fault with. It is in the province of the Government to decide in what manner they should award the contract. However, it is made clear that, Government or PWD cannot award turnkey projects to contractors, unless Government or PWD satisfy themselves that, those contractors have experience in executing composite work. In the guise of turnkey projects, Government or PWD cannot award contractors such works of contracts for which they have not executed any composite work. With the above observations, this writ petition is dismissed. No costs.
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