Case No. 30 of 2024
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COMPETITION COMMISSION OF INDIA
Case No. 30 of 2024
In Re:
Kuldeepsinh Mahendrasinh Jadeja
S/o Shri Mahendrasinh Jadeja
R/o Near Khodiyar Temple, Lakhtar,
Surendranagar, Gujarat – 382 775.
Informant
And
1. Pragyawan Technologies Pvt. Ltd.
Flat No. 2, 2nd Floor, Plot No. 70-A/31,
Guru Nanak Pura, Laxmi Nagar, Delhi – 110 092.
Opposite Party No. 1
2. KLN Engineering Pvt. Ltd.
1-60/103 on Plot No. 203, Block B, Kavuri Hills,
Guttala Bequmpet, Ranga Reddy District, Madhapur,
Hyderabad, Shaikpet, Telangana – 500 081.
Opposite Party No. 2
3. Ministry of Micro, Small and Medium Enterprises
Through its Secretary,
Udyog Bhawan, Rafi Marg, New Delhi – 110 001.
Opposite Party No. 3
4. The National Small Industries Corporation Ltd.
Through its Chairman and Managing Director
NSIC Bhawan, Okhla Industrial Estate, New Delhi – 110 020
Opposite Party No. 4
5. Government e Marketplace
Through its Chief Executive Officer
Jeevan Tara Building, #5 Sansad Marg,
Near Patel Chowk, New Delhi – 110 001.
Opposite Party No. 5
CORAM
Ms. Ravneet Kaur
Chairperson
Mr. Anil Agrawal
Member
Ms. Sweta Kakkad
Member
Mr. Deepak Anurag
Member
ORDER UNDER SECTION 26(2) OF THE COMPETITION ACT, 2002
1.
The Information in the present matter has been filed by Shri Kuldeepsinh
Mahendrasinh Jadeja (‘Informant’) under Section 19(1)(a) of the Competition Act,
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2002 (the ‘Act’) alleging contravention of the provisions of Section 3(3) of the Act by
Pragyawan Technologies Pvt. Ltd. (‘OP-1’) and KLN Engineering Pvt. Ltd. (‘OP-2’),
(collectively ‘the OPs’), in the tenders published by the National Small Industries
Corporation Ltd. (‘OP-4’), the Nodal Agency of the Ministry of Micro Small and
Medium Enterprises (‘OP-3’), on the Government e Marketplace (‘OP-5’), with
respect to procurement of Toolkits for workers under the Pradhan Mantri Vishwakarma
Yojana.
2.
The Informant has stated that on 17.09.2023, the Hon’ble Prime Minister of India
launched the Pradhan Mantri Vishwakarma Yojana, a Central Sector Scheme to provide
end-to-end support to artisans and craftspeople who work with their hands and tools.
The Scheme covers artisans and craftspeople engaged in 18 trades, viz. Carpenter
(Suthar/ Badhai), Boat Maker, Armourer, Blacksmith (Lohar), Hammer and Tool Kit
Maker, Locksmith, Goldsmith (Sonar), Potter (Kumhaar), Sculptor (Moorlikar)/ Stone
Carver/ Stone Breaker, Cobbler (Charmkar)/ Shoesmith/ Footwear Artisan, Mason
(Rajmistri), Basket/ Mat/ Broom Maker/ Coir Weaver, Doll & Toy Maker
(Traditional), Barber (Naai), Garland Maker (Malakaar), Washerman (Dhobi), Tailor
(Darzi) and Fishing Net Maker. In order to give effect to the Scheme, Toolkits for each
of these 18 crafts were required to be procured.
3.
Therefore, on 27.04.2024, OP-4 issued a Notice Inviting Proposal (‘NIP’) on behalf of
OP-3, inviting online proposals on the Central Public Procurement Portal (‘CPPP’)
from eligible bidders under “single-stage 2 packet bidding system”, for selection of
vendors for supply of Toolkits under the Pradhan Mantri Vishwakarma Yojana. As per
the NIP, 18 Request for Proposals (‘RFP’), all dated 27.04.2024, were published on the
website of OP-4 and CPPP.
4.
As per the Informant, while the NIP invited RFPs for as many as 18 tenders, they were
not uploaded on OP-5 Portal. The Informant has stated that as per the General Financial
Rules, 2017 (‘GFR, 2017’) read with the Manual for Procurement of Works, 2022, it is
mandated for all Ministries/ Departments/ PSUs etc. that all procurements for goods or
services which are available on GeM shall be mandatorily made through GeM.
However, despite the above, the NIP issued by OP-4 containing 18 tenders was not
uploaded on OP-5, in violation of Rules 149, 159, 160 and 161 of the GFR, 2017.
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5.
As per the Informant, throughout the month of May 2024, several corrigenda were also
issued by OP-4 making changes in respect of the 18 tenders, one of which dated
27.05.2024 introduced 12 amendments in the original NIP, including the follows:
A. Amendment at S. No. 2 – In the Instructions to Bidders, Para 4.3 regarding
Financial Criteria pertaining to Turnover and Net Worth and Annexure IV were
revised as under:
“4.3 Financial Criteria:
3) Turnover: The minimum average annual financial turnover of the
bidder from operations for the last 3 years should not be less than Rs.
56,25,00,000 (Rupees Fifty Six Crore Twenty Five Lakhs only) as per the
audited annual report duly authenticated by a Chartered Accountant
along with a Certificate from the Chartered Accountant including
membership number and UDIN as per format enclosed at Annexure-IV
shall be uploaded with proposal. The bidders have the options to submit
either:-
3 years audited financial figures of FY 2020-21, 2021-22 and 2022-23
OR
Audited figures of FY 2021-22, 2022-23 figures of 2023-24*In case the
bidder submits the unaudited provisional figures of FY 2023-24 for
Annual Turnover and Net Worth, the same is required to be submitted
with certification from the Statutory Auditor of the bidder with
membership number and UDIN along with complete details.”
B. Amendment at S. No. 6 – A new condition to Para 4.5 of T&C was introduced
viz.:
“Sub-para 4.5(e) is introduced
Para 4.5(e)
Preference would be given to the original manufacturer of tools/ items.
The Bidder or its OEM(s) must have sufficient production capacity and
past experience as per RFP.”
6.
Thereafter, as per the Informant, on 01.08.2024, OP-4 cancelled 10 out of 18 RFPs
issued. Reason for cancelling these RFPs was claimed as “None of the bidders qualified
during technical evaluation”. However, as per the Informant, on 03.08.2024, the RFP
for ‘Washing Machines for Dhobis’, which was cancelled on 01.08.2024, was
relaunched through OP-5.
7.
The Informant has alleged that in this RFP, however, in utter disregard to the
corrigendum dated 27.05.2024, which was applicable to the then existing RFP for
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‘Washermen’ vide which the minimum average annual turnover for a prospective
bidder was INR 56,25,00,000/-, was reduced to INR 33,75,00,000/- i.e. by almost 40%.
8.
The Informant has suggested that for the purposes of the present Information, the
relevant product market shall comprise the respective market of each of those 18
Toolkits under the Vishwakarma Scheme for which the RFPs were invited vide NIP
dated 27.04.2024. Further, as per the Informant, mere cancellation of 10 out of the 18
RFPs shall not change the factum of commission of anti-competitive acts, especially
bid-rigging, by the concerned OPs. The Informant has stated that insofar as the relevant
geographic market is concerned, since RFPs were invited from all over India, and the
Toolkits were also to be supplied across India, the relevant geographic market shall
constitute whole of the country as the RFPs were called from there where the
manufacturers/ suppliers of Toolkits would reside and form competitors of OP-1 and
OP-2.
9.
The Informant has averred that in almost all the 18 tenders, OP-1 as well as OP-2 have
submitted their RFPs; however, in all 18 (including the cancelled ones), OP-2 was
disqualified at the technical stage for identical reason viz. “Udyam Certificate not
admissible being in medium category”. Further, in almost all places out of the 8 non-
cancelled tenders, OP-1 has emerged as L1 whereas OP-2 has consistently emerged as a
mere contestant in the bidding process, never proceeding to win the bid. As per the
Informant, this clearly indicates that OP-1 and OP-2 were acting collusively and OP-2
was giving a supporting bid in all these RFPs.
10.
Further, the Informant has stated that for the RFPs for Toolkits for Hammer, Boat
Maker, Sculptor, Blacksmith and Fishing Net Maker, OP-1 has alone qualified as the
technical bidder, while OP-2 alone is the common bidder to have been disqualified.
Furthermore, for RFPs for Locksmith, Armourer, and Boat Maker, OP-1 has qualified
along with 2 other bidders, while OP-2 again has been disqualified. As such, the
Informant has alleged that OP-1’s qualification in as many as 5 RFPs on the basis of a
single-technically qualified bid and in other 3 bids as well, is not by virtue of fair play
and but perhaps by dubious means wherein, it was supported by OP-2 as well as some
unknown insiders from OP-3 and OP-4.
