STATE OF ASSAM AND ANR.versusM/S. ABHINANDAN TRADING (P) LTD. AND ANR.

A                          STATE OF ASSAM AND ANR.
                                           v.
               M/S. ABHINANDAN TRADING (P) LTD. AND ANR.

                                 NOVEMBER 8, 2006

B                   [G.P. MATHURANDALTAM<\.SKABIR, JJ.]


         Contract-Contract of supply of potable alcohol/rectified spirit (Gr.I)
  to excise warehouse of State-Notice inviting tender-Specifying basis for
C viable range of price-Contract given to the party whose quotation was
  below the viable range-Two tenderers challenged grant of contract in Writ
  Petition-Contract set aside by Single Judge of High Court-Order of Single
  Judge upheld in Writ Appeal-Potable spirit kept being supplied to the
  Government on the basis of agreement-On appeal, held: The contract was
  rightly granted though the procedure adopted by the State for fixing viable
D price range may not be prudent as the same is amenable to misuse to favour
  a particular applicant-But in absence of such a/legation, decision of State
  cannot be held wrong-It may be more prudent for the Government to adopt
  a different procedure in future-But it has to be left to the Government to
  resort to such procedure-Court cannot express any -opinion as to what
E procedure Government should adopt-It will not be in the interest of the
  Government or the people to prevent the supply-Assam F.xcise Rules, 1945-
  Rule 91.

          Tenders were invited by the State of Assam under Rule 91 of Assam
    Excise Rules, 1945 for grant of exclusive ::>rivilege of supplying potable
F   alcohol/rectified spirit (Gr. I). Clause 28 of Notice Inviting Tender specified
    that the contract would be given to the tenderer found suitable from the 'viable
    range' which was to be determined on the basis of analysis of the cost price,
    export duty, transport cost etc. Five tenders were forwarded to the State
    Government for consideration. Commissioner af Excise worked out the viable/
    reasonable rate for supply of the pota'.Jle alcohol/rectified spirit at Rs.18.23
G   per London Proof Litre (LPL). The rate was worked out after taking into
    ~onsideration various factors referred to in Clause 28 of the Notice Inviting
    Tenders (NIT). The Ccmmissioner and Secretary to the Government of Assam,
    Excise Department were of the view that viable rate should be Rs. 24/- per
    LPL. However, it was recommended that the lower rate from amongst the rate

H                                         704
,                    STATE OF ASSAM v. ABHINANDAN TRADING (P) LTD.               705
    offered by recommended firms within the viability range of Rs. 17.11 to Rs.          A
    18.95 per LPL be considered because rate of Rs. 24/- would cause the prices
    to go up and cause hardship to the consumer. Thus the contract was awarded
    in favour of 'R' at the offered rate of Rs. 17.11 per LPL. Other two teriderers
    'S' and 'A' whose quotations were Rs. 15.10 per LPL and Rs. 18.95 per LPL
    respectively, challenged the grant of tender to 'R' by filing Writ Petitions.
    Writ Petitions were allowed by Single Judge of High Court setting aside the          B
    grant of the contract on the ground that such grant did not disclose any logical,
    acceptable or reasonable basis. The judgment was challenged in writ Appeals.
    The same was dismissed by Division Bench of High Court holding that
    stipulation contained in Clause 28 of NIT had not been complied with as a
    viable rate of Rs. 18.23 per LPL was fixed instead of determining the viable         C
    price range. Hence the present appeals.

          Allowing the appeals, the Court

          HELD: I. It is no doubt true that there is scope of the concept of
    "viability range" being misused to favour a particular applicant, but there is       D
    no such allegation in the instant case, nor has any ma/a fides been attributed
    to the action taken by the authorities in awarding the contract to 'R' whose
    offer was much lower than the fixed rate. (714-A-B)
           2. Although, doubts were expressed by this Court '.n Dutta Associates
    regarding the concept of "viability range", its necessity or its real purpose,       E
    the decision afthe Government of Assam to resort to such a procedure has to
    be left to the Government of Assam itself. Unless, it can be shown that the
    said procedure had been misused to favour any particular individual, which is
     not so in the instant case, it would not be proper for this Court to express any
    opinion as to the procedure the Government should adopt except to say that
    whatever procedure is adopted should be open, fair and transparent.                  F
                                                                            [714-C-E)
           3. In the instant case, the methodology adopted for fixing the viable price
    range, indicates that even if the said method may not be the ideal method for
                                                                            I
    granting of contracts, an average of different rates quoted against different
    heads by all the applicants are taken together and the ratio thereof is arrived      G
    at for fixing the viable range. It may be more prudent for the Government of
    Assam to adopt a different procedure in future, but as far as the present case
    is concerned, although the Commissioner of Excise had fixed the "viable rate"
    at Rs.18.23 per LPL, a "viable range" was computed between Rs. 17.11 per
    LPL and Rs. 18.95 per LPL. Considering the fact that the offer made by 'A'
    {Rs.18.95 per LPL) was higher than the rate fixed by the Excise                      H·
    706                    SUPREME COURT REPORTS [2006] SUPP. 8 S.C.R.

A Commissioner, the Government in its wisdom thought it best to award the
    contract to 'R' whose offer ofRs.17.11 per LPL was lower than the fixed price.
                                               '                         [714-E-G]
          4. More than one and a half years have elapsed in respect of the period
    for which the contract had been awarded and despite the orders passed by the
    single Judge and the Division Bench of the High Court, they have still been
B   supplying potable spirit to the Government of Assam on the basis of such
    agreement. It will not be in the interest either of the Government of Assam
    or the people of Assam to prevent from 'R' continuing such supply, especially
    when the correctness of the Single Judge's order is capable of being disputed.
    The Division Bench merely gave a stamp of approval to the Single Judge's
c   judgment without examining the legal proposition involved.
                                                                  (714-H; 715-A-B)
          5. Having particular regard to the doubts expressed by this Court in
    Dutta Associates in order to avoid future controversy, the Government of Assam
    may adopt some other procedure for granting similar contracts in future
    which is open and transparent and will not give rise to controversies of the
D   instant nature in future. (715-D-E]
          Dutta Associates Pvt. Ltd. v. Inda Merchants Pvt. Ltd., (1997) 1 SCC
    53, referred to.

          CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4730 of2006.
E
         From the final Judgment anc! Order dated 6.10.2005 of the High Court
    of Gauhati in Writ Appeal No.585/2005.

         Dr. A.M. Singhvi, Pragya Baghel, Amrit Bhandari, Baruah, Ruby Singh
    Ahuja, Arunabh Choudhary, Rajiv Mehta and B. Aggarwal for the Appellants.
F
         Altaf Ahmad, M.N. Rao, Ajay Sharma, T.A. Khan, Rajeev Sharma and
    Kishan Datta for the Respondei:ts.

          The Judgment of the Court was delivered by:

G         ALTAMAS KABIR, J. Leave granted.

           On 29th January, 2005, tenders were invited by the State of ~ssam
    under Rule 91 of the Msam Excise Rules, 1945 for the granting of exclusive
    privilege of supr!ying potable alcohol/rectified spirit (Gr. I) to its excise
    warehouse at Tinsukia for a period of three years from the date of settlement.
H   The estimated annual consumption of country spirit in the area covered by
        STATE OF ASSAM v. ABHINANDAN TRADING (P) LTD. [ALTAMAS KABIR, J.]   707

the Tinsukia Warehouse was contemplated by the Notice Inviting Tende.r             A
(NIT) to be approximately 15,60,000.000 London Proof Litre (for short LPL).

      Clause 28 of the NIT reads as follows:-"

        Contract will be considered to the suitable valid tenderer in the viable
        range for smooth and continuous supply of Spirit as may be                 B
        recommended by the Commissioner of Excise, Assam with the approval
        of Government. The viable range will be determined on the basis of
        analysis of cost price, export duty, transportation cost etc. by the
        Commissioner of Excise, Assam."

      As will appear from the materials on record, in all 8 tenders were           C
received pursuant to the said NIT dated 29th January, 2005 and the same were
opened in the presence of the tenderers on I Ith March, 2005.

       After processing the same, the Commissioner of Excise submitted his
 report to the State Government on 10th May, 2005 in which he found three
 of the said tenders to be defective. The remaining five tenders were forwarded    'D
 to the State Government for consideration. In the said report submitted to the
 State Government, the Commissioner of Excise worked out the viable/reasonable
 rate for supply of potable alcohol/rectified spirit to the excise warehouse at
Tinsukia at Rs.18.23 per LPL. The stand of the State Government is that the
said viable/reasonable rate was worked out by the Commissioner of Excise           E
after taking into consideration the various factors referred to in Clause 28 of
the NIT. Pursuarit to the said NIT, one M/s. Satya Capital Services (P) 'Ltd.
submitted its tender quoting an amount of Rs.15. l 0 per LPL for award of the
contract. One Mis. Abhinandan Trading (P) Ltd. quoted a rate of Rs.18. 95 per
LPL for award of the contract and Mis. Rangpur Trading Company (P) Ltd.
quoted a rate of Rs.17.l l per LPL. Ultimately, the contract was awarded to        F
Mis. Rangpur Trading Company (P) Ltd. Such grant of contract to Mis.
Rangpur Trading Company (P) Ltd. was challenged by M/s. Satya Capital
Services (P) Ltd. by way of Writ Petition, being No.5305/2005, and also by
Mis. Abhinandan Trading (P) Ltd. by way of Writ Petition, being No.5132/
2005. The learned Single Judge allowed the said writ petitions and set aside       G
the grant of contract in favour of Mis. Rangpur Trading Company (P) Ltd.
upon holding that such grant did not disclose any logical, acceptable and/
or reasonable basis. The State Government was directed to take a fresh
decision in accordance with law and without any further delay.
      The aforesaid judgment of the learned Single Judge dated 27th September,     H
    708                    SUPREME COURT REPORTS [2006] SUPP. 8 S.C.R.

A   2005, was challenged by way of three separate appeals-one by the State of
    Assam, being Writ Appeal No.58512005, and the other two by the successful
    tenderer, M/s. Rangpur Trading Company (P) Ltd., being Writ Appeal Nos.
    581 and 582 of 2005. The three Writ Appeals having been filed against the
    common judgment and order passed by the learned Single Judge date.d 27th
    September, 2005 in W.P. (C) No.5132/05 and 5305105, they were taken up for
B   hearing and disposal together and were disposed of by the Division Bench
    by a common judgment and order dated 6th October, 2005. Agreeing with the
    findings of the learned Single Judge holding that the Commissioner of Excise
    had failed to comply with the stipulation contained in Clause 28 of the NIT
    and had fixed a viable rate at Rs.18.23 per LPL instead of determining the
C   viable price range, the Division Bench held that the entire process of granting
    the contract had been vitiated resulting in an arbitrary decision. The Division
    Bench took note of the fact that the Commissioner and Secretary to the
    Government of Assam, Excise Department, had been of the view that the
    viable rate should be Rs. 241- per LPL, but the same had not been accepted
    and the contract had been awarded to Mis. Rangpur Trading Company (P)
D   Ltd. at the rate of Rs.17 .11 per LPL.

           The State of Assam has filed SLP (C) No.2388912005 against the judgment
    of the Division Bench of the Gauhati High Court affirming the judgment of
    the learned Single Judge allowing the Writ Petitions filed by Mis. Satya
E   Capital Services (P) Ltd. and Mis. Abhinandan Trading Company (P) Ltd.
    Mis. Rangpur Trading Company (P) Ltd., whose contract had been quashed
    by the learned Single Judge, has filed two Special Leave Petitions, namely,
    SLP (C) Nos.24565 and 2456612005. Since all the three Special Leave Petitions
    arise out of the common judgment of the Division Bench of the Gauhati High
    Court, in the three Writ Appeals referred to hereinbefore, they have been
F   taken up for hearing and disposal together and special leave has been granted
    in all the three matters.

         Appearing for the State of Assam, Dr.· A.M. Singhvi, learned senior
   advocate, explained that in order to eliminate speculative bidders and to
   ensure uninterrupted supply of potable alcohol to the excise warehouse at
G Tinsukia, the State of Assam had included Clause 28 in the NIT which
  ·specified the criteria on the basis whereof the price range was to be computed.

          He urged that the concept of "viability .range" had been considered and
    upheld by the Division Bench of the Gauhati High Court in Prasanna Dutta
    v. State of Assam, reported in (2004) 3 GLT 146.
H
        STATE OF ASSAM''· ABHINANDAN TRADING(P) LTD. [ALTAMAS KABIR, J.]    709
      As indicated hereinbefore, a viable/reasonable rate had been worked              A
out by the Commissioner of Excise at Rs.18.23 per LPL. On the other hand,
the Commissioner and Secretary to the Government of Assam, Excise
Department, was of the view that the viable rate should be Rs.24/- per LPL.
Ultimately, however, as it was felt that the said rate of Rs.24/- per LPL would
cause the prices to go up and cause hardship to the consumer, the said
Commissioner and Secretary, Excise Department, Government of Assam,,                   B
recommended that the lower rate from amongst the rate offered by
recommended firms within the viability range ofRs.17.11 to Rs.18.95 per LPL
be considered. Such recommendation resulted in the awarding of the contract
in favour of M/s. Rangpur Trading Company (P) Ltd. at the offered rate of
Rs.17.11 per LPL.                                                                      C
      Dr. Singhvi submitted that since three different rates had been quoted
and the accerted rate was Rs.18.23 per LPL, the said three prices quoted were
taken to be the viability range and the tenderer whose rate was found to be
the lowest in relation to the viable range was given the contract. Speciai
emphasis was laid on Clause 28 of the Notice Inviting Tender which has been            D
extracted hereinbefore.

      It was stated that after receiving the various applications, the average.
of the different amounts calculated against the different heads were computed
and the viable/reasonable rate was arrived at on the basis thereof. In this .
process, the offer made by Mis. Satya Capital Services (P) Ltd., was held to E
be unworkable.

      Dr. Singhvi submitted that the aforesaid policy to formulate a viable
range had been taken keeping in mind the fluctuations in the price of raw
materials, cost of transportation, duties and margin of profit, not only for the       F
year in which the contract was awarded but also for the next two years since
the contract was for a period of three years. It was submitted that such a
policy had to be adopted on account of the fact that Assam by itself did not
produce potable spirit and was dependent on the supply of the said commodity
from neighbouring States.
                                                                                   G
      Referring to the judgment of the learned Single Judge, Dr. Singhvi           1



submitted that it had been contended on behalf of the writ petitioners that
the very concept of a viable range/rate was arbitrary and beyond the
competence of the respondents. Such a submission had not been fully accepted
by the learned Single Judge who proceeded to examine the manner in which
                                                                                       H
    710                     SUPREME COURT REPORTS [2006) SUPP. 8 S.C.R.

A   the viable rate had been arrived at firstly by the Excise Commissioner and
    thereafter by Qie Departmental Commissioner. Having arrived at a conclusion
    that a vitible rate and not a viable range had been fixed by the Commissioner
    of Excise, and that too after ignoring the view of the Departmental Commissioner
    that the correct viable rate should have been Rs.24/- per LPL, the learried
    Single Judge observed that the contract had been given to a person whose
B   rate was below the viable rate, which was contrary to the policy which
    prompted the authorities to provide for a viable range for grant of such
    contract.

          It was submitted that the learned Single Judge had misunderstood the
C   purport of fixation of a viable price range and had erred in concluding that
    the grant of contract made in favour of M/s. Rangpur Trading Company (P)
    Ltd. did not disclose any logical, acceptable and/or reasonable basis.

          A further submission was made that despite referring to the decision of
    this Court in the case of Dutta Associates Pvt. Ltd v. Indo Merchants Pvt.
D   Ltd & Ors., reported in [ 1997] I SCC 53, wherein certain reservations were
    expressed regarding the policy of fixation of a viable range, the learned Single
    Judge made it clear that he was not expressing any opinion on the power and
    competence of the State Government to fix such a viable rate/range by
    incorporation of a specific clause in the Notice Inviting Tender.

E         Apart from referring to the aforesaid decision in the Dutta Associates
    Pvt. Ltd. (supra), Dr. Singhvi also referred to the decision of this Court in
    Mis. Produce Exchange Corporation Ltd. v. Commissioner of Excise, Assam
    and Anr., reported in [1972] 3 SCC 713, which was a decision for the proposition
    that under the Assam Excise Rules the Government was not prohibited from
    entering into negotiation with tenderers since it was interested in getting the
F   country liquor at the cheapest rate and to ensure regular supplies.

           Certain other decisions were also referred to in support of the proposition
    that the Court was entitled to examine decisions taken to award contracts to
    private parties, but the same need not detain us since.we are not really called
G   upon to examine such question in the instant case.

          Dr. Singhvi submitted that the Division Bench while considering the
    writ appeals filed against the judgment of the learned Single Judge merely
    referred to Clause 28 of the Notice Inviting Tender and observed that the
    learned Single Judge had rightly held that the entire process of granting the
H   contract flad been vitiated as the concerned authority issuing the tender
        STATE OF ASSAM v. ABHINANDAN TRADING (P) LTD. [ALTAMAS KABIR, J.]   711

notice had failed to discharge its stipulated responsibilities resulting in an     A
arbitrary decision. No other reasoning has been given by the Division B~nch
even with regard to the decision to compute a viable range for the purpose
of grant of contract for supply of potable spirit.

      Dr. Singhvi concluded on the note that the procedure evolved for the
computation of a viable range was fair and transparent and was not meant           B
to favour any individual and that the three different prices quoted by the
three short-listed applicants, in fact, comprised the price range contempl~ted
in clause 28 of the N.l.T. He urged that the judgment of the learned Single
Judge was based on the sole consideration that instead of fixing a viable price
range, the Commissioner of Excise had fixed a rate of Rs.18.23 per LPL, which      C
according to the learned Single Judge vitiated the entire process.

      Dr. Singhvi's submissions were adopted by learned counsel appearing
on behalf of the appellant in the Civil Appeal arising out of SLP (C) No.24565-
24566/05. In addition it was stated that after having been awarded the contract,
the appellant had been continuing to supply potable spirit to the Government       D
of Assam at its Tinsukia Excise Warehouse in terms of the contract and
notwithstanding the decision of the Gauhati High Court, it had continued to
make such supplies in view of the interim order passed by this Court on 2nd
December, 2005.

       While supporting the judgment of the Gauhati High Court impugned iQ E
these appeals, Mr. Altaf Ahmed, learned senior counsel, broadened the scope
of his submissions in contending that the very concept of fixing a viable price
range was improper and was capable of misuse. It was submitted that as had
been observed by the learned Single Judge of the High Court when the
Departmental Commissioner was of the view that the viable rate should be, F
Rs.24 per LPL, there was no logical explanation as to why the contract had
been awarded to Mis. Rangpur Trading Company (P) Ltd. whose quoted price
was far lower than the viable rate as computed by the Departmental·
Commissioner. It was contended that the very intention of maintaining regular
supply of potable spirit, which was the basis of the decision to fix a viable ·
range of prices, stood defeated by the grant of the contract in favour of G
Mis. Rangpur Trading Company (P) Ltd.

      Referring to the decision of this Court in Dutta Associates Pvt.Ltd
(supra), Mr. Ahmed submitted that a similar question had arisen in the above
case regarding the grant of contract for supply of potable spirit on the basis
of the concept of "viable range". He pointed out that while the "viability         H
    712                     SUPREME COURT REPORTS [2006) SUPP. 8 S.C.R.

A   range" had. been fixed in the said case between Rs.14. 72 to Rs.15. 71 per LPL,
    Mis. Dutta Associates who had quoted a lower figure than the lowest end of
    the viability range was asked to increase its bid and only thereafter the
    contract was awarded to it. Such action on the part of the authorities of the
    Excise Department was challenged before the Gauhati High Court in a Writ
    Petition which was dismissed by the learned Single Judge but, on appeal, the
B   Division Bench allowed the Writ Appeal and set aside the acceptance of the
    tender upon holding that the authorities had acted unfairly in calling upon
    Dutta Associates alone to submit" a counter offer while not giving a similar
    opportunity to other tenderers. Directions were given to call for fresh tenders
    to award the contract. Mr. Ahmed submitted that when the matter was brought
C   to this Court, this Court expressed its misgivings about the procedure relating
    to the fixation of a viability range. It was observed by the learned Judges that
    they had not been able to understand or appreciate the concept of viability
    range, its necessity or its real purpose. While affirming the judgment of the
    Division Bench in the Writ Appeal, this Court directed that the procedure to
    be followed in the matter of acceptance of a tender should be transparent, fair
D   and open.

          Mr. Ahmed submitted that when the decision of the Assam Government
    to grant contracts on the basis of "viability range" had been commented upon
    with disfavour by this Court, it was improper on the part of the Government
E   of Assam to resort to the same methodology for awarding the contract for
    potable spirit on the same basis. Furthermore, in the instant case, no viability
    price range had been fixed which was one of the main reasons which prompted
    the learned Single Judge of the Gauhati High Court to set aside the contract
    awarded in favour of M/s. Rangpur Trading Company (P) Ltd.

F         It was urged that even if the above position was to be ignored, there
    was no explanation forthcoming as to why a viable price had been resorted
    to for the purpose of granting the contract when it had been decided to
    prepare a viable price range and the learned Single Judge had rightly set aside
    the contract granted in favour of Mis. Rangpur Trading Company (P) Ltd. on
    that basis.
G
          Mr.M.N. Rao, learned senior counsel appearing for Mis. Satya Capital
    Services (P) Ltd., submitted that the offer of the said respondent had not even
    been considered on the ground that the price quoted at Rs.15.10 per LPL was
    far lower than the viable price fixed at Rs. 18.:23 per LPL. According to Mr.
    Rao, the same logic which prompted the authorities of the Excise Department
H
           STATEOI' ASSAMv. ABHINANDANTRADING(P)LTD. [ALTAMASKABIR,J.]           713

· ,. to award the contract to Mis. Rangpur Trading Co. (P) Ltd. should have been         A
     applied for awarding the contract to his client. On the other hand, the refusal
     to grant the contract to his client was sought to be justified by the authorities
     by taking resort to the theory of viable price range, although the lower
     extreme of the purported price range was arbitrarily fixed at Rs.17 .11 per LPL
     which was the price quoted by M/s. Rangpur Trading Co. (P) Ltd.
                                                                                         B
           Mr. Rao submitted that this very same question had been consider~d
   by this Court in the case of Dutta Associates (supra) and it had been observed
   that all those making offers were hard-headed businessmen who were quite
   alive to the economic viability of the offers made by them. Mr. Rao submitted
   that if his client was ready and willing to supply potable spirit at the rate of      C
   Rs.15. I 0 per LPL, which was lower than the rate offered by M/s.Rangpljr
   Trading Company (P) Ltd., there could be no proper or logical explanation o~
   the part of the Government of Assam to refuse to award the contract to his
   client.

          All the learned counsel appearing in this matter had occasion to refer         D
   to and rely upon the decision of this Court in Dutta Associates (supra). In
   the said case, the tender notice did not specify the "viability range" nor did
   it indicate that only the tenders coming within the 'viability range" would be.
   considered. Such omission led this Court to observe thiit fairness demanded
   that the authority should have notified in the tender notice itself the procedure'
   which they proposed to adopt while accepting the tender.                              E
        The doubts expressed by this Court in the aforesaid decision were
  taken note of by the Government of Assam and it led to the inclusion of
  Clause 28 in the Notice Inviting Tender where the aforesaid omission was
  sought to be remedied. Clause 28 of the NIT which has been extracted
  hereinbefore, specifies that the contract would be given to the tenderer found
                                                                                   F
  suitable from the "viable range" which was to be determined on the basis of
  analysis of the cost price, export duty, transport cost etc. by the Commissioner
  of Excise, Assam. What had been left unspecified in the Notice Inviting
  Tender was, therefore, introduced subsequent to the decision in the case of
  Dutta Associates and the applicants for grant of the contract can have no G
  further grievance on such score.

       However, apart from expressing doubts over the decision of the
  Government of Assam of taking recourse to the concept of "viability range",
  the discussion thereupon was not taken any further and the decision was
  rendered on a different set of facts, namely, that for granting the contract           H
     714                     SUPREME COURT REPORTS [2006] SUPP. 8 S.C.R ..

A negotiations were entered into with one of the applicants only.
           It is no doubt true that there is scope of the concept of ":viability range"
     being misused to favour a particular applicant, but there is no such allegation
     in the instant case, nor has any ma/a fldes been attributed to the action taken
     by the authorities.in awarding the contract to M/s. Rangpur Trading Company
B    (P) Ltd. whose offer was much lower than the fixed rate. One of the arguments
     advanced was that the offer made by Mis. Abhinandan Trading (P) Ltd. was,
     in fact, closer to the fixed rate than that of M/s. Rangpur Trading Company
     (P) Ltd.

           Considering the submissions made and the ground realities regarding
C    supply of potable spirit to Assam, we are inclined to accept Dr. Singhvi's
     submission and to reject those made by Mr. Altaf Ahmed and Mr. M.N. Rao.
     Although, doubts were expressed by this Court in Dutta Associqtes (supra)
     regarding the concept of "viability range", its necessity or its real purpose,
     the decision of the Government of Assam to resort to such a procedure has
D    to be left to the Government of Assam itself. Unless, it can be shown that
     the said procedure had been misused to favour any particular individual,
     which is not so in the instant case, it would not be proper for us to express
     any opinion as to the procedure the government should adopt except to say
     that whatever procedure is adopted should be open, fair and transparent.

E           In the instant case, the methodologr adopted for fixing the viable price
     range, as explained by Dr. Singhvi, indicates that even ifthe said method may
     not be the ideal method for granting of contracts, an average of different rates
     quoted against different heads by all the applicants are taken together and
     the ratio thereof is arrived at for fixing the viable range. It may be more
F    prudent for the Government of Assam to adopt a different procedure in future,
     but as far as the present case is concerned, although the Commissioner of
     Excise had fixed the "viable rate" at Rs.I8.23 per LPL, a "viable range'; was
     computed between Rs. I 7.1 I per LPL and Rs. I 8.95 per LPL. Considering the
     fact that the offer made by M/s. Abhinandan Trading (P) Ltd. (Rs. I 8.95 per
     LPL) was higher than the rate fixed by the Excise Commissioner, the Government
G    in its wisdom thought it best to award the contract to M/s. Rangpur Trading
     Company (P) Ltd. whose offer of Rs. I 7. I I per LPL was lower than the fixed
     price.

          More than one and a half years have elapsed in respect of the period
     for which the contract had been awarded in favour of M/s. Rangpur Trading
·H   Company (P) Ltd. and as we have been informed, despite the orders passed
              STATE OF ASSAMv. ABHINANDANTRADING(P)LTD. [ALTAMAS KABIR.J.]    715

     by the learned single Judge and the Division Bench of the Gauhati High           A
     Court, they have still been supplying potable spirit to the Government of
     Assam on the basis of such agreement. In our view, it will not be in the

..   interest either of the Government of Assam or the people of Assam to prevent
     Mis. Rangpur Trading Company (P) Ltd. from continuing such supply,
     especially when the correctness of the learned Single Judge's order is capable
     of being disputed. The Division Bench merely gave a stamp of approval to
                                                                                      B
     the learned Single Judge's judgment without examining the legal proposition
     involved.

           For the reasons aforesaid, we are of the view that all the three appeals
     should be allowed and they are allowed accordingly. The common judgment          C
     and order dated 27th September, 2005 passed by the learned Single Judge in
     W.P. (C) No.5132/2005 and W.P.) No.5305/2005 as also that of the Division
     Bench dated 6th October, 2005, passed in Writ Appeal No.585/2005 filed by
     the State of Assam and Writ Appeal Nos.581 and 582/2005 filed by Mis,
     Rangpur Trading Company (P) Ltd., are hereby set aside.
                                                                                      D
           Before we part with this matter, having particular regard to the doubts
     expressed by this Court in Dutta Associates (supra), we merely express the
     view that in order to avoid future controversy, the Government of Assam may
     adopt some other procedure for granting similar contracts in future which is
     open and transparent and will not give rise to controversies of the instant
     nature in future.                                                                E

          There will be no order as. to costs.

     K.K.T.                                                      Appeals allowed.