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M/S NSOFT(INDIA) SERVICE PVT LTD., V/S M/S BESCOM LTD., & OTHERS , decided on Wednesday, July 23, 2008.
[ In the High Court of Karnataka, Writ Petition No.3381 of 2008 (GM-TEN) . ] 23/07/2008
Judge(s) : N. KUMAR
Advocate(s) : H.N. Sashidhara, M/s Kesvy & Co.. R1, N. Krishnananda Gupta, R2, Shobha Bhavikatti, , R3, B. Veerappa AGA.
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  "2008 ILR(Kar) 3787"   ==   "2009 (6) KantLJ 509"  







judgment - Kumar J.The petitioner has challenged in this Writ Petition two contracts awarded to the second respondent and sought for quashing of the same. The first contract is in respect of spot billing and collection in BESCOM Sub-Divisions. Second contract refers to maintenance of billing software.2. The first respondent floated a tender inviting bids for Total Revenue Management of Billing and Collection of BESCOM Sub-Divisions in respect of 4 lots. The common qualifying requirements were stipulated for all the Lots. The petitioner was one such bidder and so also the second respondent. Petitioners bid was not accepted whereas the second respondents bid was accepted. The grievance of the petitioner is that the second respondent did not possess the requisite qualification namely three years experience of providing similar services in any electricity supply utility in India. The second respondent contended that they do possess the three years qualification. The first respondent has not categorically stated in the statement of objections that the second respondent do possess the requisite qualification of three years experience. But they rely on the observations of the appellate authority who has held that the second respondent has three years experience. Therefore they contend that the petitioners contention is baseless.3. The petitioner preferred a statutory appeal against the order passed by the tender accepting authority under Section 16 of the Karnataka Transparency in Public Procurements Act 1999 for short hereinafter referred to as the Act. The Appellate Authority after considering the rival contentions at paragraph 4 of the order dealt with the matter and held according to R- I the requirement as stated in the bid document is only work of similar nature. Since there is no specific definition in the tender document on what constitutes work of similar nature the decision of the tender inviting authority in determining this was accepted and accordingly it dismissed the appeal. Aggrieved by the said orders the petitioner is before this Court.4. Learned counsel for the petitioner assailing the aforesaid findings contended that the crucial date for computing three years experience is 19.11.2006 the date of the tender Notification. The material on record discloses that for the first time the second respondent supplied spot billing machines only on 3.12.2004. If the period is computed from the said date as on 19.11.2006 the second respondent did not have the prescribed qualification. Therefore the findings recorded by the procurement entity as well as the Appellate Authority is on the face of it illegal and therefore is liable to be quashed.5. Per contra the learned counsel appearing for the first respondent contended that it is on 5.5.2003 as per Annexurc-R13 the second respondent was awarded the previous contract and the period so computed from the said date makes it clear that the second respondent had the three years experience and therefore there is no substance in the contention of the petitioner. Learned counsel for the second respondent reiterated the aforesaid stand.6. Annexure-H is the modified notice inviting tenders issued by the first respondent which is the subject matter of this Writ Petition. In the Notification the first respondent invited tender through e-tendering from the eligible bidders for spot billing and collection in BESCOM sub-divisions of the lots mentioned therein for a period of three years and renewable for a further period of two years on annual basis subject to the discretion of BESCOM and mutually agreed terms and conditions. The circles to which the said tender related to was Bangalore Rural Tumkur Davanagere and Kolar. Clause 7.0 deals with the requirement of the procuring entity. It reads as under:Requirements:The operational requirements:i) The billing application software the operating system the database and the interface and the application software for the spot billing machines will be provided by BESCOM.ii) Bills will be generated by BESCOM meter readers through spot billing machines supplied by the service provider at the customer premises and the bills will be handed over to the customer at his site only. (Specifications of the SBM are enclosed in Annexure I). In this case SP will supply all the required spot billing machines to the Meter Readers to facilitate the generation of electricity bills and should be responsible for the day to day maintenance of such terminals.iii) The required stationery for both spot billing machines (specification in the annexure 2) as well as for office purpose to meet the day to day activities at each sub-division will be supplied by the SP. SBMs should be supplied at the sub-division at rate of one machine per meter reader and/or the GVP.iv) The collection of revenue will happen at the local and remote Cash counters of the sub-division. A computer printer bat-code seamier and UPS shall be provided by the SP at the cash counters. The operations at the cash counter will be carried out by the staff of BESCOM with the assistance of the personnel belonging to SP but actual handling of cash cheques and drafts etc. will be done by BESCOM officials only.v) The SP should provide the necessary hardware as follows:(The specification as per Annexure-1) (appr-appropriate nodes)Qualifying requirements: (Common for all the LOTs)a. The Bidder shall be in the business of providing similar service for the last three years in any electricity supply Utility in India and have their own software development team for the last three years.b. The minimum turnover of the bidder in similar nature of job should be Rs.5 Crores per annum (Three years annual audited accounts should be produced along with the bid document).c. The bidder should have minimum 25 technically qualified persons (BE Computer or MCA Experienced in database applications) as well as knowledge on handling the oracle database application on Unix/Linux platform in the pay roll of the company/firm for the last three years (Documents will be verified by the BESCOM IT staff)d. The bidder should have minimum 10 technical persons in their payroll for the last three years to handle computer hardware problems like computer systems printers etc. (Underlining by me)7. A reading of the aforesaid provision makes it clear that the bidder has to supply spot billing machines at the customers premises. He is also expected to supply stationary for both spot billing machines as well as for office purposes to meet the day to day activities in each sub-divisions. The bidder also has to supply desk top PCs 136 column dot matrix printer 80 column dot matrix printer laser printer barcode scanner Online UPS and LAN. In substance it is a tender for supply of goods.8. For supply of the aforesaid goods the qualification prescribed for the bidder is that the bidder shall be in the business of providing similar service for the last three years in any electricity supply utility in India and have their own software development team for the last three years. The words similar service is referable to the goods to be supplied under clause 7.0 requirements for a period of three years. In fact in the context the word similar is not only inappropriate but also misleading. The correct description would have been Goods.9. Earlier the second respondent was awarded a contract for maintenance of the systems and data base at 52 Sub-Divisions and also to establish a date warehouse at corporate office to maintain the customer accounts on 5/7-5-2003. This contract was for a period of two years. The respondents rely on Annexure-R13 to show the three years experience which refers to this contract for service. A reading of Annexure-R13 shows that the first respondent requested the second respondent to take up the work of providing DBA Support up gradation of BNC Software and database at qualified L1 rate as envisaged in the project immediately. Further reliance was placed on Annexure-R14 dated 22.9.2003 where it is stated with reference to the work entrusted to the second respondent the work of tuning and maintenance of the billing and collection software at 52 subdivision of BESCOM to a total cost of Rs.43 20 000/- is awarded to the second respondent-firm on mutually agreed terms and conditions to be entered into separately. There is no mention about supply of spot billing machines in the said tender. On the contrary it was a contract of service. The contract is for providing DBA Support Up gradation of BNC Software and Database and further includes the work of tuning and maintenance of building and collection software. Therefore the earlier contract was not at all a contract for supply of goods and no spot billing machines were supplied under the said contract whereas the present contract is for supply of spot billing machines and other goods as aforesaid which they call it as ?BUSINESS OF PROVIDING SIMILAR SERVICE. It is obvious that these words are used in the tender with ulterior motive to help the second respondent and to award the contract to him. It is predetermined and tailor made.10. After the aforesaid contract was awarded to the second respondent for the first time under a separate contract No.309/2003-04 dated 3.12.2004 the second respondent has supplied 500 numbers of hand held spot billing instrument with printer for electricity bills including all necessary software interface software etc. Therefore the second respondents experience in supplying spot billing machine to the first respondent is to be computed from 3.12.2004. So calculated as on 19.11.2006 the second respondent did not have the three years experience as required under the terms of the bid document. In fact the earlier contract was purely for maintenance of hardware and software which were supplied by the first respondent. Therefore the decision of the procurement entity that the second respondents do possess three years qualification in supplying spot billing machines to the first respondent for a period of three years is ex facie illegal and contrary to the material on record. Unfortunately the Appellate Authority has not applied its mind to these material particulars and simply carried away by the expression used similar business without properly finding out what is the nature of tender and the work expected of the second respondent under the tender in question and what was the experience the second respondent acquired under the earlier tenders. Therefore the order of the Appellate Authority is illegal. Thus the second respondent did not possess the three years experience in supplying spot billing machines and other hardware items which is the subject matter of the tender in question. Accordingly the award of contract to the second respondent in preference to the petitioner who appears to have all the requisite qualification is a clear case of preferring a bidder who does not satisfy the qualification prescribed by the procuring entity. Therefore the award of the contract to the second respondent is illegal and is liable to be quashed and accordingly it is quashed.11. The second contract pertains to maintenance of billing software awarded to the second respondent as per Annexure-G The work of maintenance of billing software in Kolar Tumkur Davanagere and Bangalore Rural Circle at the rate of 65 paise per installation per month for the successfully generated bills during the month exclusive of applicable taxes was awarded to the second respondent. The contract was for a period of three years from the date of implementation and extendable for 2 more years on mutually agreed terms and conditions. It is not in dispute that before awarding this contract to the second respondent the first respondent did not float any tender. It was awarded to the second respondent under clause (b) of Section 4 of the Act. The petitioner has alleged in the Writ Petition that the said award of contract is contrary to the provisions of the Act and therefore liable to be quashed.12. It is not in dispute that the petitioner was not a bidder for the said contract as no tender was floated by the first respondent. The award of contract is challenged for the first time in this Writ Petition. Therefore it was contended on behalf of the respondents that when the petitioner was not a rival claimant he is estopped from challenging the contract that too belatedly before this Court.13. When the first respondent did not invite tenders the question of petitioner submitting his bid would not arise. It is true in the tender floated in 2005 the petitioner was not an applicant. That cannot be held against him while awarding contract for the year 2007. As he was not aware of the award of present contract to the second respondent he has challenged the same immediately after coming to know of the same. That explains the delay. Therefore this Writ Petition filed challenging the award of contract to the second respondent without calling for tender and in contravention of Section 4 of the Act is maintainable.14. Even on merits it was contended that the first respondent had floated a tender inviting bids for DBA and centralized consumer date base?cum-consumer care centre in the year 2002. The last date for sale of bidding document was 17.10.2002 and the last date for receipt of bids was 31.10.2002. In pursuance of the said Notification five applications were received and the petitioner was not one among such applicant. On consideration of the comparative merits of those five applicants the bid submitted by the second respondent was accepted as it was more competitive. The said contract was for a period of two years as is clear from Anenxure-R13 dated 5/7.5.2003. It is after expiry of the two years period the impugned contract has been awarded to the second respondent as per Annexure-G under clause (b) of Section 4 of the Act as the aforesaid service is available only from a single source and there are no reasonable alternatives or substitutes exist. If the first respondent has complied with the provisions of Section 4(b) of the Act and has awarded the contract to the second respondent the petitioner cannot have any grievance whatsoever. Therefore it is to be examined whether Section 4(b) of the Act has been complied with while awarding the contract to the second respondent.15. The records of the first respondent is made available to the Court. It discloses on 3.11.2006 a meeting was held to discuss regarding the implementation of the billing software and to have a uniform billing system across BESCOM and to examine whether as per the Act the BILLNET software can be deployed across BESCOM and its maintenance can be given to the second respondent. The relevant proceedings are reproduced hereunder:‑BANGALORE ELECTRICITY SUPPLYCOMPANY Corporate Office K.R. Circle Bangalore ? 560 001PREAMBLE:BILLNET software utilized for Billing of BESCOM in BMAZ is developed and maintained by M/s. Zygox infotech Ltd. Bangalore. In the meeting held on 03-11-2006 under the chairmanship of CMD BESCOM to discuss regarding the implementation of the billing software and to have a uniform billing system across BESCOM it was asked to examine whether as per KTPP act the BILLNET software can be deployed across BESCOM and its maintenance can be given to M/s. Zygox Infotech Ltd. Hence a committee was constituted to examine whether the BILLNET software developed for BESCOM with the assistance of M/s Zygox Infotech Ltd. can be treated as single source and the maintenance of this software can be given through a direct award.The committee with the following members constituted with the following terms of reference.1. Sri Lokaraj Joint Secretary Energy Department GOK Vikasa Soudha Bangalore2. Sri Vishwanatha Prasad Director (Technical) BESCOM Bangalore3. Sri Laxminarayana Holla Chief Engineer; Electy. APDRP P&M & IT-MIS KPTCL Kaveri Bhavan Bangalore4. Sri K R Sethuram GM Elect. C 0 & M Bangalore South Circle BESCOMThis Committee has examined the following terms of reference:1) The BILLNET software is only from single source2) The maintenance of the BILLNET Software can be directly awarded to M/s Zygoz Infotech Ltd. with respect to KTTP act.The Committee had four sittings. The following points were discussed:1. During the first meeting the overall gist of the BILLNET Software was explained to the members. The members felt a detailed presentation was needed by BESCOM and the firm was needed.2. During the second meeting the members viewed the presentation by BESCOM3. In the 3rd sitting M/s. Zygox Infotech Ltd. gave a presentation on the BILLNET Soft and the company profile of M/s Zygox.4. During the 4th sitting the members debated on the issue of awarding the maintenance contract to M/s. Zygox directly without any tender with respect to the terms of reference.Hence we the members of this committee come to a unanimous conclusion that as none of us are experts in the software domain this matter should be referred to Prof Sadagopan Director IIT Bangalore for his opinion Sd/‑Joint SecretaryEnergy Department Gok Sd/‑Chief Engineer Electy. APDRPP&M& IT-MIS KPTCL Sd/-Director-Technical BESCOM Sd/‑General Manager (Elec)Bangalore SouthCircle - BESCOM(Underlining by me)16. A reading of the aforesaid proceedings make it clear that the first respondent was conscious of the fact that if any service or goods have to be procured they have to follow the Act and an exception is carved out under Section 4 and before the said exception could be availed of it is necessary for them to constitute a committee under the said section. Therefore a committee consisting of four members was constituted to examine whether the BILLNET software developed for BESCOM with the assistance of the second respondent could be treated as a single source and the maintenance of this software can be given through a direct order. The committee examined the terms of reference. It held four sittings. The points discussed during these sittings are referred. But in the end they are fair enough to observe that we the members of this committee come to a unanimous conclusion that as none of us are experts in the software domain this matter should be referred to Prof. Sadagopan Director HT Bangalore for his opinion.17. From this it is clear that the committee constituted under Section 4 was not a committee of experts. It was a committee of four officials who were not experts. Therefore the said committee cannot be construed as a committee of experts constituted under Section 4(b) of the Act. It was not a committee of experts under the said provision.18. The said committee addressed a letter to Professor Sadagopan which reads as under: ‑BANGAL ORE ELECTRICITY SUPPLYCOMPANY LIMITED(Wholly owned Government of Karnataka Undertaking) No. GM(E)/BCS/SPA/-19972-73 Office of the GeneralEncl: One Bunch Manager (Elec)C O&M South Circle K.R. Circle Bangalore Dated. 27-12-2006 Prof: S. Sadagopan 4 Jan 2007 DirectorInternational Institute of informationTechnology26/C Opp. Infosys (Gate-I)Electronic CityBangalore ? 560 100By Regd. PostSir Sub: Awarding Maintenance Contract of the Billing Software Implemented in BESCOM.Ref: Our discussion with your kindself on 16-12-2006 at IIIT Bangalore.-----Adverting your kind attention to the above subject and as discussed with your kindself we wish to bring the following points:BESCOM has implemented Billing Software which was initially developed by TCS and then awarded to M/s Zygox for maintenance during 2003 which is running successfully in Bangalore city. Now BESCOM intends to expand the same software to entire BESCOM area.In this regard we need your expert opinion on the following:i) Can BESCOM directly award this maintenance contract to M/s Zygox or should call for a tenderii) We are using SCOUNIX V7.1.3. as our operating system with Oracle 8.1. as the database and VB.net as front end for this billing software. We need your opinion on continuing using this version of this software.Further if any clarifications are required please feel free to contact the undersigned.Yours faith fully Sd/‑General Manager (Elecl.) Bangalore South Circle BESCOM & Convener of the Committee19. A reading of the aforesaid letter makes it clear that instead of asking the expert whether the aforesaid services are available elsewhere or it is available only from a single source or the second respondent has exclusive rights in respect of the aforesaid goods or service they were requesting the expert to tell them whether they can directly award the maintenance contract to the second respondent or should they call for a tender. In reply to the said letter Professor Sadagopan has replied as under :‑INTERNATIONAL INSTITUTE OF INFORMATIONTECHNOLOGY BANGALOREProf. S. Sadagopan DirectorJanuary 22 2007General Manager (South)South Circle BMAZBangalore Electricity Supply CompanyLimited (BESCOM)KR Circle BangaloreFax: 22354936 Dear SirMy views on your request.a) Regarding the extension of billing software contract to the entire BESCOM areaBilling software is a fairly sophisticated piece of code with a large number of features whose maintenance requires intimate and deep knowledge of the functionality. In addition commitment expertise and reach are needed to efficiently serve the local community. If the vendors past record is good it is best enlarge the scope of the contract negotiate a better price and award it directly. Starting with another fresh tender would lead to possible disruption in service and deficiency in functioning during transition that BESCOM may ill-afford. It is unlikely that any other vendor can offer significant price advantage; also the transition time could be considerably large (about a year)b) Up-gradation of SCO Unix O/S and Oracle DBMSIt is a standard practice to keep pace with current developments in key infrastructure software pieces (operating systems and DBMS) for any mission-critical application. It is best to upgrade to current version of Oracle. SCO Unix has become a very marginal player with minimal support possible in future. It is best to transition to other operating systems such as Redhat Linux/ SuSe linux from Novell or Microsoft Windows (taking into account application portability.Thanking youWith regardsSd/‑S. SadagopanCc: Mr. Anil D SouzaAsst. CM.-IT&MISDBESCOMBangalore20. A reading of the letter makes it clear that it is an opinion of an expert. But it does not disclose that the services rendered is available from a single source only or that the second respondent has exclusive right in respect of the services and no reasonable alternative or substitutes exist. Therefore he has not certified that the services are available from a single source. The said opinion is of no assistance and if the authority has acted on such opinion it is highly illegal. However it is thereafter on the basis of the said opinion the contract was awarded to the second respondent.21. It is in this background we have to see what are the requirements to be satisfied under Section 4 of the Act before a contract could be awarded without calling for tender. The Act was enacted by the Karnataka State Legislature to provide for ensuring transparency in public procurement of goods and services by streamlining the procedure in inviting processing and acceptance of tenders by Procurement Entities and for matters related thereto. Procurement Entity has been defined under the said Act to mean any Government Department a State Government Undertaking Local Authority or Board Body or Corporation established by or under any law and owned or controlled by the Government and any other body or authority owned or controlled by the Government and as may be specified by it. Chapter II deals with regulation or procurement. Section 5 provides that on and from the date of commencement of the Act no procurement entity shall procure goods or services except by inviting tenders for supply. Section 6 contemplates that no tender shall be invited processed or accepted by a procurement entity after the commencement of the Act except in accordance with the procedure laid down in the Act or the Rules made thereunder. Act provides for publication of tender bulletins tender bulletin officers tender inviting authority and tender accepting authority tender scrutiny committee opening of tenders duties of tender inviting authority how a tender is to be accepted how a tender is to be rejected and a statutory appeal to a person aggrieved in the aforesaid tender process.22. Therefore after coming into force of the Act inviting tenders for procuring the goods and services is the rule and the said procurement should be in accordance with the procedure prescribed under the Act. However the Act makes two exceptions. Firstly as contemplated under Section 3 the provisions of the Act are not made applicable to the projects funded by international financial agencies or projects covered under international agreements. The second exception with which we are concerned is found in Section 4 which reads as under :‑4. Exceptions to applicability.- The provisions of Chapter II shall not apply to Procurement of goods and services ‑(a) During the period of natural calamity or emergency declared by the Government; (b) Where the goods or services are available from a single source or where a particular supplier or contractor has exclusive rights in respect of the goods or services or construction work and no reasonable alternatives or substitutes exit.Provided that for the purpose of this clause there shall be a committee of three experts consisting of one technical representative of the procuring entity one technical representative of the Government organization dealing with similar procurement and one representative from a reputed Academic Or Research Institution or Non-Commercial Institution having expertise in such line to examine and declare that the goods or services are available from a single source. 23. Therefore it is clear during the period of natural calamity or emergency declared by the Government for procuring goods or services it is not necessary to follow the procedure prescribed under the Act. The second exception is clause (b). That is where the goods or services are available from a single source or where a particular supplier or contractor has exclusive rights in respect of the goods or services or construction work and no reasonable alternatives or substitutes exist. Then it is not necessary to follow the procedure prescribed under the Act. There is no obligation to procure such services and goods by inviting tenders. But before this provision could be invoked there should be a finding by a competent authority that the goods or services are available only from a single source or a particular supplier or a contractor who has exclusive rights in respect of the goods or services. For that purpose the statute provides for constitution of a committee of three experts consisting of the following persons:‑1) one technical representative of the procuring entity 2) one technical representative of the Government organization dealing with similar procurement 3) one representative from a reputed Academic or Research Institution or Non-Commercial Institution having expertise in such line to examine and declare that the goods or services are available from a single source.24. The said experts have to be drawn from three different sources as mentioned in the provision. The significance of the same is that two of them are not under the control of the procurement entity. That is how the public interest is protected and transparency is achieved even in exceptional cases. Therefore all the aforesaid persons i.e. technical persons must be experts in the field. It is the committee consisting of these three experts alone which on consideration of the goods and services which are placed before it can declare that the goods or services are available from a single source. It is after such certification by the committee of experts in the field the procurement entity could place orders for supply of service and goods from such single source. Therefore the Legislature has taken pains to meticulously provide in the Act itself for the constitution of the committee of experts and for their decision before the regular procedure is dispensed with. As Section 4 is an exception to the general rule the said provision has to be strictly construed.25. It is in this background when we look into the facts of this case the first respondent committed the first error in not appointing experts in the field as committee members. The committee constituted was not of experts. They were unable to take a decision. The said committee committed an error in referring the matter to a Professor an expert in the field for which they had no power under the Act. It is the procurement entity which has to constitute a three member expert committee to consider the services rendered by the second respondent and then to find out whether he is the only person who has got exclusive control of the said service. That has not been done. After the matter was referred to Professor Sadagopan obviously he was not aware of the provisions of this Act. He has not certified that the petitioner is the only source from which this service could be procured. The recommendation made by him is very general in nature. It does not satisfy the requirement contemplated under proviso to sub-Section (b) of Section 4. In the letter addressed by him to the first respondent he has not declared that the goods or services are available from a single source or that the second respondent has exclusive rights in respect of the goods and service. The third error committed was without properly understanding the contents of the said letter the first respondent has proceeded on the assumption that Sri Sadagopan is of the view that the second respondent is the only single source from whom the said service could be procured and they have awarded the contract to the second respondent on the basis of the said letter.26. From the aforesaid facts it is clear that there is total non-application of mind by the first respondent in the constitution of the expert committee in making reference to an expert and also in not understanding what the expert has stated by way of his opinion. Therefore the first respondent committed a serious illegality in awarding the contract to the second respondent.27. Having regard to the object with which the Act was passed by the Karnataka Legislature nearly nine years back the tendency of the first respondent an Instrumentality of the State to continue to indulge in manipulations and distributing the public largesse is quite evident in this case. When the whole machinery of an instrumentality of the State is directed towards preferring a particular individual or a company in preference to other persons who are similarly placed and the anxiety shown by the statutory authority in awarding contract in utter violation of the provisions of the Act clearly demonstrates that the authorities are acting in violation of the rule of law. In fact the way tender is worded also gives an impression that from the inception they have kept in mind the interest of the second respondent and not the authority. When these facts are brought to the notice of this Court this Court cannot be a silent spectator. It is not a mere issue of a writ to quash an illegal action. A duty is cast on the Court to see in future such illegalities do not occur. Therefore it is very much necessary for this Court to quash these contracts in particular the second contract which is granted in utter violation of the provisions of the Act. As the petitioner has succeeded in showing the illegality he is entitled to succeed and is entitled to get both the contracts quashed.28. However merely because the contract awarded to the second respondent is quashed at the instance of the petitioner the petitioner is not entitled to the award of contracts straightaway. Before the petitioner could be said to be entitled to the contract he should satisfy the tender accepting authority that he possess the requisite qualification. That is an exercise to be done by the tender accepting authority and not by this Court. Therefore I pass the following order:‑(a) Writ Petition is allowed.(b) Annexures-A B C and D as well as Annexure-G are hereby quashed. The order of the Appellate Authority at Annexure-W is also quashed.(c) The first respondent is directed to consider the tender of the petitioner in respect of the contract at Annexure- H in accordance with law and pass appropriate orders.(d) In respect of the contract Annexure G the first respondent is directed to follow the procedure prescribed under the Act in awarding the contract(e) No costs.