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CASE NO.: Appeal (civil)  2227 of 2008

PETITIONER: S.S. & Company

RESPONDENT: Orissa Mining Corporation Limited

DATE OF JUDGMENT: 28/03/2008

BENCH: H.K.Sema & Aftab Alam

JUDGMENT: J U D G M E N T [arising out of SLP (C) NO.12003/2007] WITH

CIVIL APPEAL NO. 2228 OF 2008 [@ SLP (C) NO.12008/2007]

M/s.Faridabad Gurgaon Minerals            ...Appellant

Versus

Orissa Mining Corporation Limited                ...Respondent

REPORTABLE

AFTAB ALAM, J.         Leave granted in both the matters.                    These two appeals, taken together for the sake of  convenience, question the validity of two different clauses  in the eligibility criteria in a Notice Inviting Tenders (NIT),  issued by the respondent-Orissa Mining Corporation  Limited (hereinafter referred to as \021the Corporation\022).  The  appellants in the two appeals make a grievance that the  two clauses were designed to exclude them from  consideration.  They first went to the High Court of  Orissa challenging the validity of the clauses and the  rejection of their respective tenders on that basis.  M/s.  S.S. & Company challenged the validity of Clause   8(i) of  the NIT in W.P.(C) No.7001/2007, (giving rise to SLP (C)  No.12003/2007).  M/s.Faridabad Gurgaon Minerals  challenged Clause 8(vii) of the NIT in W.P. (C)  No.7002/2007, (giving rise to SLP (C) No.12008/2007).     A Division Bench of the High Court by separate  judgments, dated July 12, 2007 dismissed both the writ  petitions.  The judgments of the High Court are brought  in appeal before this Court.         The appellants in each of the two appeals are  proprietorship firms owned and controlled by a father  and son duo and the controversy in the two cases relates  to the grant of contract for raising, calibration and  transport of iron ores at Daitari Iron Ore Mines of the  respondent-Corporation.           The Corporation issued NIT No.16 on November 11,  2004 for grant of contract for raising, calibration and  transport of iron ore at Daitari mines for a three year  period.  Here, it may be noted that in NIT 16 sub-clauses  (i) and (vi) of Clause 8 relating to eligibility criteria were

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as follows:- \0238.  The eligibility criteria of the tenderers  shall be as follows:-  

Only such tenderers who fulfil the  following eligibility criteria shall  participate in the tender:-

(i)     The agency must have successfully  executed  similar work (as  mentioned in NIT/raising work(s) of  ore/minerals) for a  minimum  amount of 30% in case of a single  work or 50%  in case of two works of  the value of work shown in column   No.5 of NIT in any one financial year  during the last three years including  2003-04.

(vi)   Any agency who is already executing  similar and identical work in any  mine will not be allowed to take up  the second work in the same mine  and such agency will not be allowed  to participate in the tender.   However, if the work of the said  agency is due to end within six  months of the date of issue of this  NIT and there is no possibility that  the work tendered for and the  existing work in hand will operate  concurrently, this restriction will not  be applicable to the concerned  agency.\024  

(The above quoted clauses in their  amended form are now the subject matter  of controversy).   

       In response to NIT 16, dated November 11, 2004,  M/s.Faridabad Gurgaon Minerals (FGM) was the  successful bidder and by letter, dated January 29, 2005  issued by the Corporation it  was  awarded the work  \021initially for  a period of one year for a quantity of 12.00  lakh MT.\022 on rates as indicated in that letter.  In that  letter, it was further stipulated that the awardee might  be considered for extension for second and third year  working subject to satisfactory performance in the  preceding   year(s) based on the terms and conditions  mentioned in the tender schedule.  The first year period  of the contract commenced from February 25, 2005 and  came to end on February 24, 2006.  The parties are also  in agreement that the contract was extended for the  second year, i.e., upto February 24, 2007 but as regards  the third year, the two sides are in serious dispute.  The  Corporation takes the stand that the appellant was  given work for the third year as well and the work  period would come to end on February 24, 2008.  The  appellant FGM, however, maintains that its work in  Daitari Mines under NIT 16 came to end on  June 30,  2007.         Even while the contract awarded to FGM under  NIT 16 was subsisting, the Corporation issued NIT  No.65 on July 7, 2006 for grant of another similar  contract for raising, calibration and transport of iron

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ores from Daitari Iron Ore Mines.  FGM was not eligible  to take part in the tender process in view of the bar of  clause 8(vi) but M/s.S.S. & Company (SSC), the other  appellant before the court gave its tender for the work  under NIT 65.  For some reasons, however, its tender  was not accepted and it took the matter before the  Orissa High Court.  During the pendency of the writ  petition, the Corporation cancelled NIT 65 and issued  NIT 75, dated November 18, 2006 for the same work.    This rendered the writ petition filed by SSC infructuous  and it was withdrawn.   NIT 75 had a similar fate.  The  tender made by SSC was not accepted.  The dispute was  taken to the Orissa High Court but the Corporation  cancelled  NIT  75 thus rendering the writ petition  infructuous.  Here, it may be noted that both NITs 65 &  75 had clauses 8(i) and 8 (vi) exactly in the same terms  as in the earlier NIT 16, dated November 11, 2004  (which have been reproduced above).         After cancellation of NIT 75, the Corporation  issued NIT 85, dated May 25, 2007 which is the  subject-matter of the controversy in the two cases.  NIT  85 had the two clauses 8 (i) and 8 (vii) in slightly   amended forms as follows:-         \0238.The eligibility criteria of the tenderers  shall  be as follows:    

       Only such tenderers who fulfil the  following eligibility  criteria shall  participate in the  tender:-

(i)     The agency must have successfully  executed similar work (as mentioned in  NIT/raising work(s) of ore/minerals  excluding Minor Mineral) for a minimum  amount of 30% in case of a single work or  50% in case of two works of the value of  work shown in column No.5 of Sl. No.2 of  NIT in any one financial year during the  last three years including 2006-07.

(vii) The agency who is already executing the  work in a mine of OMC Ltd. will not be   allowed to take up the second work in the  same  mine and such Agency will not be  allowed to participate in the tender.\024            

   It is thus to be seen that in sub-clause (i) the  words \021excluding Minor Mineral\022 was added to the  portion in parenthesis, making it explicitly clear  that raising of Minor Mineral would not be  acceptable as experience in \021similar work\022.   Likewise, in sub-clause (vii), the overlapping  margin of six months was done away with and as a  result the tenderer was required not to have any  pre-existing work in Daitari Mines on the last date  for submission of tender (11.06.2007).              SSC was hit by sub-clause (i) and FGM that  was working in Daitari Mines on the basis of the  previous contract, by sub-clause (vii).  Both the  appellants fancied that the two sub-clauses were  specially tailored with the sole intent and purpose  to exclude them from consideration.  They,  accordingly, went to the High Court making loud  protests and alleging mala fide.         FGM filed Writ Petition (C) No.7002 of 2007,

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before the High Court stating that the overlapping   margin of six months for a pre-existing contract to  work in the same mine was dropped from NIT 85 of  2007 with the mala fide intent  to exclude it from  consideration.  It was submitted that on May 25,  2007, the date on which the notice was issued and  on June 11, 2007, the last date for submission of  tenders in response to the notice, the appellant  alone was working in Daitari Mines and the sub- clause was only aimed to exclude it from  participating in the tender process.  It was also  pointed out that previously three successive  notices allowed the margin of six months and there  was no reason to do away with the margin period.   It was further contended that the amendment in  the sub-clause, disallowing anyone with a pre- existing contract in the same mine to participate in  the tender process was arbitrary as it would serve  no purposes, much less any reasonable one.         The High Court by a well reasoned judgment  and order negatived all contentions raised by the  appellant and dismissed the writ petition. It held  and found that the appellant completely failed to  establish any mala fides and in paragraph 20 of  the judgment observed as follows : \023Insofar as question of malice or bias is  concerned, no case is made out in the  writ petition.  Though some vague  allegations are scattered in the writ  petition in different paragraphs, there is  no serious pleading of malice or mala fide  or bias against the authorities of the  Corporation.\024  

On merits, the High Court held that there was a  perfectly good reason for doing away with the six  months\022 margin for a pre-existing contract in the  same mine.        The High Court also took note of the case of  the respondent-Corporation that by communication,  dated February 21, 2007, the period of the  appellant\022s contract was extended upto February  24, 2008.  According to the Corporation, the letter  made it clear that the contract was extended for the  third year too and the appellant was awarded the  work of raising 20.00 lakh metric tons of Ore from  February 25, 2007 to February 24, 2008 on the  terms and conditions as provided in the agreement.   Since the appellant would be working the mines till  February 24, 2008, it could not take part in the  tender process even if the six months margin was  still there.  The High Court accepted the case of the  respondent-Corporation in this regard and cited it  as one more reason for taking the view that there  was no substance in the appellant\022s grievances.         Mr.Mehta, learned counsel for the appellant  FGM, submitted that the letter dated February 21,  2007 (referred to in the High Court judgment) could  not be taken as extension of the contract for the  third year under NIT 16.        The letter, dated February 21, 2007 was   written in response to the appellant\022s request for  renewal/extension of the contract for the third year  and it conveyed the Corporation\022s decision to award  the work to the appellant for the third year

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extension with effect from February 25, 2007 to  February 24, 2008 under the same terms and  conditions of the agreement.  This letter was  followed by another letter, dated May 25, 2007  (which according to Mr.Mehta was overlooked by the  High Court). By this letter the Corporation awarded  the work to the apppellant \021though partly, to be  precise from February 25, 2007 to June 30, 2007\022  indicating the target (of extraction) to be achieved  and the work value as per the rate under the tender  schedule.  The letter was described as the \021letter of  intent\022 and it asked the appellant to make certain  deposits by June 30, 2007 for drawing up the  agreement for the third year period of the contract.   In paragraph 7 of the letter it was clearly stipulated  that all other terms and conditions indicated in the  tender schedule would remain unchanged and  would apply mutatis mutandis.         Mr.Mehta submitted that this letter was simply  a work order and neither this letter nor the earlier  one of February 21, 2007 could mean the extension  of the contract under NIT 16 for the third year.   Learned counsel referred to Annexures P-8 and P-9  which are copies of agreement No.4/2005-2006 and  agreement No.4/2006-2007 for the periods  February 25, 2005 to February 24, 2006 and  February 25, 2006 to February 24, 2007  respectively.  Learned counsel submitted that unlike  the two previous years no formal agreement was  drawn up for the third year of the contract period  from February 25, 2007 to February 24, 2008 and,  therefore, the High Court was clearly in error in  accepting the claim of the Corporation that the  appellant\022s contract under NIT 16 was extended for  the third year period and it would be subsisting till  February 24, 2008.         In our view, the submission is quite mis- conceived.  The materials on record plainly indicate  that the appellant was trying to find ways to get out  of the contract for the third year period because the  rates under the tender schedule were no longer  profitable to it.  We were shown the Corporation\022s  letter, dated June 29, 2007 by which it was pointed  out to the appellant that according to the terms of  the tender the contract was for a period of three  years and it would expire on February 24, 2008.  It  was further stated in the letter that the appellant  had badly defaulted on the production target for the  first quarter of 2007-2008 and in terms of clause  1.8 of the tender schedule it was asked to clarify its  final stand and to indicate its production plan for  the remaining tender period i.e. till February 24,  2008.  To the Corporation\022s letter, the appellant  gave a highly evasive reply by its letter of July 4,  2007.   Alluding to Writ Petition (C) No.7002/2007 it  stated that the matter was sub-judice before the  High Court and on that plea it declined to enter into  any correspondence on the issue raised by the  Corporation.  It is to be noted here that the Writ  Petition arose from a controversy relating to the  eligibility clause in NIT 85/2007 and it had nothing  to do with the production targets under NIT  16/2004.         Be that as it may, suffice it to note that on the  appellant\022s request for renewal/extension of the

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contract the Corporation had taken the decision to  award the work in its favour for the third year  extension with effect from February 25, 2007 to  February 24, 2008 (vide letter dated February 21,  2007).  In pursuance of the decision the  Corporation further issued the letter dated May 25,  2007 asking the appellant to make the required  deposits by June 30, 2007 for drawing up the  agreement for the third year under the contract.   It  is thus manifest that, according to the Corporation,  the appellant-company had the right to work the  mine till February 24, 2008 and on its own showing  it was actually engaged in working the mine till  June 30, 2007.       Here, it is to be noted that sub-clause (vii) of  clause 8 is aimed at preventing the same party from  executing two different works in the same mine at  the same time.  The clause does not even refer to a  formal contract and if someone should be working  the mine, may be on the basis of a work order  issued by the Corporation, that in itself might be  sufficient, in certain circumstances to attract clause  8(vii), even in the absence of a formally drawn up  contract.  Seen thus, the whole issue as to whether  or not a formal contract for the third year of the  tender period was drawn up in favour of the  appellant would appear to be of no relevance.  The  fact of the matter is that the appellant on its own  showing was working the mine upto June 30, 2007.   Further, in view of the decision of the Corporation it  had the right to be there upto February 24, 2008.   Therefore, the High Court was not incorrect in  observing that the appellant would have been  barred from taking part in the tender process even if  the six months margin was retained in the eligibility  clause.      Furthermore, the question whether the  appellant had the right to stay in the mine till  February 24, 2008 or its work there came to end on  June 30, 2007 has relevance only on the issue of  mala fide.  Otherwise, it is always open to the  Corporation to issue a tender notice, at any time,  according to its needs, and to introduce an  eligibility clause in the tender notice or to delete  from it any  pre-existing one as it might best serve  its purpose. Hence, the controversy with regard to  the outer limit of the appellant\022s presence in the  mine on the basis of the earlier contract under NIT  16 has no relevance sans the allegation of mala fide.      Now, we will proceed to examine the case of  the appellant in this regard.  On behalf of the  appellant, it is alleged that the overlapping margin  of six months in clause 8(vii) was dropped with the  sole intent to keep it out of the tender process.  In  support of the allegation three arguments are  advanced on its behalf.  One is that on May 25,  2007, (when NIT 85 was issued) and on June 11,  2007 (the last date for submission of tender) the  appellant alone was working the mine.  The  appellant\022s work in the mine, according to its  assertion would have come to end on June 30,  2007.  The eligibility clause was, therefore, so  tailored as to render it disqualified by 19 days. The  second argument is that the change in clause 8(vii)  was made for the first time.  In the earlier tender

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notices the same eligibility clause allowed a margin  period of six months but it was done away with in  order to exclude the appellant who had only 19 days  presence left in the mine.  The third argument  advanced on behalf of the appellant is that the  deletion of the six months margin is otherwise  completely arbitrary and it serves no reasonable  purpose.      The first two circumstances are woefully  inadequate to bring home the grave charge of mala  fide and the High Court was quite right in holding  that the appellant completely failed to establish its  case in that regard.  It is axiomatic that the  Corporation is the best judge of its interests and  needs and it is always open to it to suitably modify  or change the eligibility criteria so as to best serve  its purposes.  Whenever a change is introduced in  the eligibility criteria either by introducing some  new conditions or restricting or altogether doing  away with certain previous concessions it might  hurt the interests of someone or the other but for  that reason the change(s) made in the eligibility  criteria cannot be labelled as mala fide.  The first  two arguments advanced on behalf of the appellant  thus completely fail to show any mala fide and we    now proceed to examine the third argument  advanced on its behalf.        As noted above, on behalf of the appellant it is  contended that dropping away of the six months  margin does not serve any purpose whatsoever but  it only ensured the appellant\022s exclusion.      On the other hand, the Corporation gives a  very reasonable and valid explanation for the  change made in the eligibility clause. In paragraph  4 of counter-affidavit filed by the Corporation it is  stated as follows :                         \023That the above condition was included in  the Tender Notice because if an agency  which is working at a particular rate in a  particular mine is allowed to operate at a  different and higher rate under a different  Contract but in the same mine there is  every possibility of the said agency  claiming payment in respect of the work  done under the earlier contract at rates  stipulated under the new Contract.  In  other words, the same agency will operate  in the same mine with two different rates  for similar work i.e. Raising, Calibration  and Transportation of Iron Ore and fines  and there is every possibility of mixing up  the Ores which would be raised and  transported at two different rates.\024              We find that the explanation given by the  Corporation is perfectly reasonable and if any  illustration is needed it is to be found in the facts of  the case in hand itself.        The appellant was given the three years\022  contract under NIT 16 at the following rates : \023ACCEPTED RATE                                                    Rate per MT in Rs.                                           S. No.

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Description of work 1st  Year 2nd           Year 3rd  Year 1. Drilling, blasting,  excavation, transport of  ROM to Dry Screening  Plant/Crushing &  Screening Plant,  crushing and screening  of ROM to 10-30/10- 40mm CLO and 10mm  fines.  67.01 70.00 75.00 2. Transport of 10-30/10- 40mm CLO and fines  from Dry Screening  Plant/Crushing and  Screening Plant to  

a)      Baliparbat  Stockyard b)      Daitari Railway  siding

30.80 35.20

31.80 36.20

33.46 39.18

There was no escalation clause in the contract and  from the record it is manifest that the rates on  which the appellant\022s tender was accepted were no  longer profitable for it, at least in third year, and the  appellant was not at all interested in carrying on the  work for the third year on the rates given in the  tender schedule.  In paragraph 2 of the  Corporation\022s counter-affidavit it is stated that the  appellant had completely failed to meet the  production target and it was badly in default.  The  relevant extract from paragraph 2 of the affidavit is  as follows :  \023However, the respondent (sic) could not  achieve the target under said contract as  indicated hereunder :

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    Period      Target              Achieved                      Quantity         Quantity                                        (Quantity in MT)      1st Year     12.00 lakh         03.75 lakh      2nd Year     20.00 lakh        13.05 lakh      3rd Year      09.22 lakh       01.16 lakh                       (Upto 19th July, 07) Since 19th July, 2007, the Petitioner has  virtually stopped the work on the ground  that the rates are low even though there  is no escalation clause in the Contract  and the Petitioner is bound to complete  the contract at the contracted rates.  The  non-achievement of the target by the  Petitioner has resulted in a loss in terms  of sales revenue to the tune of Rs.115.90  crore.\024

In its rejoinder affidavit the appellant has sought to  give explanation for not being able to meet the  targets during the first and the second year of the  contract period.  It has not given any explanation  for the third year and has gone on to compare its  performance with another contender M/s.Arun  Udyog. Any comparison with M/s.Arun Udyog is  besides the issue. What is relevant here is that the  appellant was hugely in default and yet it was  insisting on taking part in NIT No.85/2007. In the  aforesaid circumstances the consequences of the  appellant getting the contract under NIT 85/2007  would have been two-fold : one, that it would  operate the same mine at the same time under two  different contracts with widely different rates and  the other, that it would be charging much higher  rates for extraction of ores that it was obliged to  extract at  much lower rates under the previous  contract.  The Corporation can hardly be faulted for  protecting itself against entering into such a bargain  with anyone.       Thus, on a careful consideration, we are fully  satisfied that doing away with the six months  margin in clause 8(vii) was not arbitrary or  unreasonable, nor it had any mala fide intent.         For the reasons discussed above, we find no  merit in the appellant\022s (FGM\022s) case.The High Court  has taken a perfectly correct view of the matter and  it warrants no interference by this Court.  M/s. S.S.& Company (SSC)         Mr. R.F. Nariman, learned senior counsel  appearing for the SSC also began his submissions  by alleging, that the amendment in clause 8(i) of NIT  85 by insertion of the words \023excluding minor  minerals\024 was mala fide: its sole purpose was to  exclude SSC and to unduly favour another bidder,  namely, M/s. Arun Udyog Ltd. In support of the  plea of mala fide Mr. Nariman advanced three  arguments.  Learned counsel stated that though  being the lowest bidder in response to the earlier  two NITs 65 and 75, SSC  was not awarded the  work because the concerned officials in the  Corporation wanted to give it to Arun Udyog whose  bids were much higher than the appellant.  When  the appellant took the matter arising from NITs 65  and 75 to the High Court, on each occasion the bid  process was aborted in the middle and finally NIT

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85 was issued with the offending amendment.  He  next submitted that the amendment made in the  clause was a one time exclusionary measure: it was  not there in the earlier NITs and it is unlikely to find  place in the future NITs. He also submitted that the  impugned amendment in clause 8(i) of NIT 85 was  made at the instance of the Managing Director and  without the prior approval of the Corporation\022s  Board of Directors.      The Corporation strongly denied that the  object of the amendment in clause 8(i) of the NIT  was to disqualify the appellant and thereby help  Arun Udyog in securing the contract. In the counter  affidavit filed in the High Court on its behalf it was  pointed out that the appellant\022s technical bid in  response to NIT75 was rejected because it had no  past experience of similar work as required under  the NIT. Thereafter the price bid of the technically  qualified tenderer, i.e., M/s. Arun Udyog Ltd. was  opened on 18.11.2006. But the Corporation decided  to cancel NIT75 and to issue a fresh NIT so that it  may have more competitive bids for consideration.  M/s. Arun Udyog Ltd. was not given the work under  NIT75 even though the appellant was out of  reckoning.        However, the High Court, even without  referring to the averments made in the  Corporation\022s affidavit, declined to entertain the  appellant\022s allegation that M/s. Arun Udyog Ltd.  was being shown undue favour and the appellant  was sought to be ousted to favour that company  observing as follows:        \023In paragraph 17 of the writ petition there  are some allegations that the opposite  party wants to favour and award the  tender to one M/s.Arun Udyog Limited.   Since M/s.Arun Udyog Limited is not  impleaded in this writ petition the  allegations against it cannot be taken into  consideration.\024

  The second and the third allegations in support of  the plea of mala fide were also rebutted by the  Corporation by filing before the High Court an  affidavit sworn by the Addl. General Manager  (Mining). The High Court took note of the averments  made in that affidavit in paragraph 8 of its  judgment as follows: \023Another affidavit dated 2.7.2007 was  also filed by the Additional General  Manager (Mining) of the Corporation.  It  has been stated therein that the  Corporation in a year floats about 120  nos. of tenders to undertake mining and  related activities in different minerals  with widely varying conditions and the  Board of Directors lays down the general  guidelines for preparing the special terms  and conditions for different types of  words.  In this connection, the broad  guidelines of special terms and conditions  were approved by the Board of Directors  on 11.6.2007.  It has been stated in the  said affidavit that the same is general  guidelines and incorporation of any other

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condition appropriate for different work  can be made.  It has also been stated in  the said affidavit that in future in the  eligibility criteria the word \021excluding  minor mineral\022 will be included while  floating NIT if the nature of work  demands for the same.  It was also stated  in the affidavit filed by the Managing  Director that Tender Notice No.85 dated  25.5.2007 was issued after its clauses  were recommended by the Managing  Director of the Corporation vide notes  dated 15.5.2007 were duly approved by  the Chairman of OMC.\024  

The High Court thus brushed aside the plea of mala  fide raised by the appellant.      We are in complete agreement with the view  taken by the High Court. As a matter of fact, for  rejecting the allegation that the impugned  amendment was introduced in clause 8(i) of the NIT  at the instance of the Managing Director, without  obtaining prior approval  of the Board of Directors  we need not even go to  the rebuttal affidavit filed by  the Addl. General Manager. The Board of Directors  is the apex policy making body. It may lay down  broad guidelines but it is impossible to conceive  that all the NITs (over a hundred in number) issued  by the Corporation for different purposes every year  should come before it for consideration and  approval of their respective clauses or any  amendment proposed in any clause in any of the  NITs. [We fail to see any good reason why the matter  should not be finalized by the Managing Director or,  depending upon the nature of the contract, even at  some lower level]. The normal work of any  organization or government department would be  seriously hampered if every tendering party would  claim the right to raise objection that one or the  other clause in a NIT or any amendment introduced  in any of its clauses did not have the prior sanction  of the highest policy making body of the  organization. In this case particularly there is no  occasion to go into that question as there is neither  any material to suggest, even remotely, that the  Managing Director harboured any malice against  the appellant nor is the Managing director made a  party to this case in his personal capacity.      This brings us to consider Mr.Nariman\022s  submissions on the substance of the amendment in  the clause in question. Here we may observe, in  fairness to the counsel, that though raising the  allegation of mala fide with some vehemence in the  beginning, as he proceeded with the submissions,  he completely shifted the focus and argued mainly  on the merits of the change introduced in clause 8  (i) of the NIT. He assailed it as wholly unreasonable,  arbitrary and as serving no purpose. Mr. Nariman  contended that the distinction between minor and  major minerals was illusory and hence, the  exclusion of any past experience of working any  minor minerals was quite unreasonable and  arbitrary and it had no relation to the object that  was claimed to be achieved. Learned counsel  elaborately referred to various provisions of the

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Mines and Minerals (Regulation and Development)  Act, 1957 and the Mineral Concession Rules, 1960.   He referred to the long title, the preamble and  section 2 of the Act and submitted that from the  latter provisions of the Act it would be evident that  the control of the Union over the regulation of mines  and minerals was cent per cent. He then referred to  section 3 clauses (a) and (e), sections 4 to 13, 14, 15  and sub-section 3 of Section 15 of the Act.  He also  referred to rule 17 of the Rules that provides that  sand was not to be treated as minor mineral when  used for certain specified purposes.  In light of the  provisions of the Act and the Rules, learned counsel  submitted that the distinction between major and  minor minerals did not depend upon hardness or  softness or the technology of excavation. Illustrating  the point learned counsel submitted that quartz and  granite though, minor minerals being so notified  under Section 3(e) of the Act, are very hard  substances and on the other hand gypsum, talc and  china clay, though major minerals are relatively  much softer substances.  Further referring to rule  17, learned counsel submitted that whether a  substance was major mineral or minor mineral  depended on its end user.  In case, sand was used  for any of the purposes specified in rule 17 of the  Mineral Concessions Rules it would qualify as major  mineral and in that event any past experience in  excavating/lifting sand would not be hit by the  impugned exclusionary amendment in clause 8(i) of  the NIT.         Mr. Nariman also referred to the decision of  this Court in D.K. Trivedi & Sons & Ors. Vs.  State  of Gujarat & Ors.  [1996 Suppl. SCC 20 paras 29  and 30].  He submitted that in view of the statutory  scheme of the Act as explained in the decision in  D.K.Trivedi the distinction sought to be made  between major and minor minerals and the  exclusion of any past experience in the excavation of  minor mineral was wholly untenable and  unfounded.      Mr. Nariman also cited before us some  decisions dealing with the scope of judicial review in  matters of grant of contract by public bodies but we  see no need to mention those decisions here.       Mr. P.P.Rao and Dr. R.Dhawan, senior  advocates appearing for the Corporation in the two  cases strongly refuted the submissions made on  behalf of the appellant. Mr. Rao submitted that in  light of the past experience the Corporation felt the  need to introduce the amendment as a measure of  quality control.  He referred to the Corporation\022s  affidavit filed before the High Court where it is  stated: \023Iron ore being too hard, drilling and  blasting and strict quality control  measures will be essential which cannot  be compared with mining of \023minor  minerals\024.  To bring required expertise for  undertaking efficient iron ore mining, the  above change in eligibility criteria has  been made.\024

Mr. Rao further submitted that the amendment was  fully in accord with the guidelines laid down by the

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Board of Directors and it was wrong to say that it  was introduced at the instance of the Managing  Director. In support of the submission he referred to  several documents but it is not necessary to advert  to them in view of the discussions made above.      Mr. Rao also submitted that the appellant\022s  turn over for the past years was far below the  requirement of the NIT and on that score also the  appellant was not eligible to take part in the bid.         Dr. Dhawan submitted that as in the case of  FGM, once the plea of mala fide is held to be  unfounded, practically nothing remains of the  appellant\022s challenge to the substance of the  amendment.  Learned counsel controverted the  submission made on behalf of the appellant and  contended that the distinction between minor and  major minerals is a statutory distinction of far  reaching significance.  He submitted that both the  Statute and case law recognized the differences  between minor and major minerals.  He referred to  paragraph 22 of the decision in D.K. Trivedi where it  was observed as follows: \023\005\005..It is pertinent to note that the term  \023minor minerals\024 came to be defined in a  statute for the first time by clause (e) of  Section 3 of the 1957 Act.  In addition to  the minor minerals mentioned in the said  clause (e), boulder; shingle; chalcedony  pebbles used for ball mill purposes only;  limeshell, kankar and limestone used in  kilns for manufacture of lime used as  building material; murrum; brick-earth;  Fuller\022s earth; bentonite; road metal; reh- matti; slate and shale when used as,  building material; marble; stone used for  making household utensils; quartzite and  sandstone when used for purposes of  building or for making road metal and  household utensils; and saltpetre, have  been declared to be minor minerals by  various notifications issued by the  Central Government\005..\024

He also referred to paragraph 33 of the decision  where it was observed as follows: \023\005\005..As seen from the definition of minor  minerals given in clause (e) of Section 3,  they are minerals which are mostly used  in local areas and for local purposes while  minerals other than minor minerals are  those which are necessary for industrial  development on a national scale and for  the economy of the country.  That is why  matters relating to minor minerals have  been left by Parliament to the State  Governments while reserving matters  relating to minerals other than minor  minerals to the Central Government.  Sections 13, 14 and 15 fall in the group  of sections which is headed \023Rules for  regulating the grant of prospecting  licenses and mining leases\024.  These three  sections have to be read together\005\005.\024

                                  (Emphasis added)

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In light of the above, Dr. Dhawan submitted that  there is a fundamental difference between minor  and major minerals in regard to their use. Minor  minerals like sand were extracted and consumed  locally. On the other hand, major minerals were  essential for the industrial development and the  economic growth of the country. This vast difference  in their purpose and use was naturally reflected in  their relative importance and the nature of mining.  Learned counsel submitted that the importance of  iron ore could not be over-stated. The production  and consumption of steel (the source of which is  iron ore) is one of the indices of economic growth of  a country.  Iron ore, apart from being required for  production of iron and steel at the national level,  was also exported to international markets. Its  extraction, therefore, apart from other things,  requires to be carried out under far stricter quality  control measures. It would be, therefore, wholly  inappropriate to compare the mining of iron ore  with the lifting and excavation of sand or other  minor minerals.         We find substance in Dr. Dhawan\022s  submission and we are unable to accept the  arguments advanced on behalf of the appellant that  any distinction between minor and major minerals  was illusory and the amendment in the clause in  question, based on the distinction between the two,  was arbitrary and did not serve any purpose.         We have noted the submissions of the two  sides and have also said that on the issue whether  there are any differences between minor and major  minerals we are inclined to accept the position  taken by Dr. Dhawan. But we think that in the  context of the case an elaborate analysis of the  provisions of the MM (R&D) Act and Mineral  Concession Rules to bring out the distinction  between minor and major minerals is quite  misconceived. We think it would be a mistake to see  the NIT through the prism of the Act and the Rules.  The NIT should not be viewed in the highly pedantic  and legalistic manner as suggested by Mr. Nariman  but it should be read and understood for what it is.  It is a notice issued by the Corporation which is  engaged in the business of mining. The Corporation  owns a number of mines and wishes to give the  work of raising, calibration and transport of iron  ores from its mines on contract to an outside  agency. It would be truism to say that the  Corporation knows best the exact nature of its work  and it is the best judge to say what is and what is  not comparable to it. The expression \023excluding  minor minerals\024 used in the eligibility must,  therefore, be viewed as commonly understood in the  mining/industrial and commercial world.  What the  clause intends to convey is that the extraction of  iron ore requires certain degree of technical  expertise and competence and in order to have the  required degree of competence the bidder must have  some past experience of similar kind of work,  clarifying further that working of minor minerals  would not be accepted as qualifying  experience/sufficient expertise for the purpose of  the NIT.  The distinction between minor and major

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minerals is well-known to the mining/industrial  and commercial world and anyone engaged in the  business would know what the eligibility clause in  the NIT demands without referring to the statute  and case law and any abstruse arguments based  thereon.        There is yet another reason, weightier than the  previous ones, for rejecting the appellant\022s challenge  to the amendment made in the eligibility clause. A  grievance against the amendment, either based on  the plea of mala fide or on the substance of the  amendment can only be raised by someone whose  position gets adversely affected by the amendment.  The basic question therefore is how far the  appellant can be said to be affected by the  amendment in actual terms. Clause 8(i) is simply  the well known and the well established experience  clause. In its unamended form as contained in NITs  65 and 75 it required the bidder to have some past  experience of the work under contract. In other  words, the bidder was required to have successfully  executed in the past some work similar in nature to  the one being the subject matter of the contract.  In  NIT 85, which is for raising, calibration and  transport of iron ore the clause in question  stipulated that the tenderer must have past  experience of similar work and made it further clear  that working of minor mineral would not be  accepted as similar in nature to the work under the  NIT.  It is thus manifest that the insertion of the  words \023exclude mine and mineral\024 does not bring  about any alteration or change in the basic  experience clause.  It simply makes it clear and  explicit that the working of any minor mineral is not  the same as raising, calibration and transport of  iron ore at Daitari Mines.  It may be noted here that  in the affidavit filed before the High Court on behalf  of the Corporation it was stated as follows: \023Some changes in the eligibility criteria of  NIT No.85 in comparison to NIT No.75  have been approved.  In clause 3(i)  \023excluding minor minerals\024 has been  added in the 2nd line of the clause after  the word minerals.  Iron ore being too  hard, drilling and blasting and strict  quality control measures will be essential  which cannot be compared with mining of  \023minor minerals\024.  To bring required  expertise for undertaking efficient iron ore  mining, the above change in eligibility  criteria has been made.\024

       Let us now examine how far the petitioner SSC  can feel aggrieved by what it describes as  amendment in the clause in question.  The  appellant\022s own statement in regard to its  experience is to be found at Annexure P-1 in which  it gives description of five different kinds of work.  The works at Sl.Nos.1 and 2 are described as    follows: \023Drilling, Blasting, Excavation, Loading  and transportation of Sand and Lumps  deploying HEMM from the leasehold area  of Faridabad Yamuna Sand Mines of M/s.  S.S. & Company (M/s. SSC)\024.

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The other three works related to handling of  materials like Rock Phosphate, Gypsum, Copper  Concentrate, flux, slag and material handling work  at Zinc Smelter Plant.      On the basis of the appellant\022s own statement  submitted along with the tender documents, the  Technical Committee in its report dated June 11,  2007, noted as follows : \023M/s.S.S.& Co. has submitted experience  certificate for working in Yamuna Sand  Quarry in the district of Faridabad and  other minor minerals including handling  in the Plant.  As per the eligibility criteria  of NIT under clause 8(i) the experience of  the agency is not at par with the  eligibility of NIT.\024   We are unable to see any error much less any  unreasonableness in the view taken by the  Technical Committee and in rejecting the  appellant\022s tender on that basis.  It does not require  much imagination to hold that the work of lifting of  sand from a riverbed or a sand quarry is not similar  in nature to the work of raising, calibration and  transport of iron ore.      It is significant to note here that the  appellant\022s tender in response to NIT75 that did not  contain the expressions \023excluding minor mineral\024  was also rejected at the stage of technical bid since  it did not satisfy the eligibility clause of having  previously done some work similar in nature to the  work under contract.        It is thus evident to us that the appellant-SSC  did not satisfy the eligibility criteria with regard to  past experience even in terms of the unamended  clause 8(i). Had the appellant been qualified in  terms of the unamended clause and faced exclusion  only as a result of the amendment in the criterion it  might have been open to it to assail the introduction  of the amendment.  But that is not the case here. As  noted above, the appellant was liable to be  excluded, and was in fact excluded, even under the  unamended clause 8(i) and, therefore, all arguments  either based on mala fide or on the substance of the  amendment lose all their relevance.      Thus on a careful consideration of all the  materials produced before the court and the  submissions advanced by the two sides we find no  merit in the case of SSC either.      Both the appeals are accordingly rejected but  with no order as to costs.