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Court: Transparency in Tenders Act not self-contained

Special Correspondent

Law enacted to prevent executive interference

Government cannot go into complex issues raised by the parties
It lacks the power of a civil court, does not have the power to record evidence

CHENNAI: It cannot be held that the Tamil Nadu Transparency in Tenders Act is self-contained for deciding disputes between the tenderer and the tender floating authority, the Madras High Court said on Monday.

Allowing an original application by Consolidated Construction Company in a suit, Justice K. Chandru said that the government, being the appellate authority, could not go into complex issues raised by the parties as it lacked the power of a civil court and did not have the power to record evidence. The government, being the ultimate owner of the schedule-mentioned organisations (in the Act), could not decide as it would amount to executive encroachment over the court’s power.

The company, the plaintiff, was one of the bidders in the international tender floated on behalf of Tidel Park Coimbatore. The project cost was fixed at Rs.140 crore and the earnest money deposit at Rs.1.4 crore.

After the offer was given by the plaintiff, no concluded contract emerged. While the plaintiff wanted escalation of cost, Tidel Park did not agree. Even after an award was made for executing the contract, the company did not execute it. It was then threatened that if it did not sign the agreement, the EMD would be forfeited and it would be recommended for blacklisting by the government. Aggrieved, the company filed a suit and the application. Tidel Park Coimbatore Ltd submitted that it was a government company. The suit itself was not maintainable in view of the statutory prohibition contained under Section 19 of the TTIT Act, by which the legislation excluded the jurisdiction of a civil court.

Mr. Justice Chandru said even from the objective of the Act, it was found that the legislation was enacted to prevent executive interference and also recurrence of irregularities by the procuring entity.

The dispute was between the plaintiff and the government company. The government could not decide the dispute. The judge directed the plaintiff to keep the bank guarantee executed alive till the disposal of the suit. He injuncted the defendants from encashing the guarantee even pending the suit.

As Advocate-General G.Masilamani, appearing for Tidel Park, had stated that there was no move to recommend blacklisting the plaintiff company, there was no necessity to pass any order, the judge said.

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