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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.
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11.
Moreover, the Informant has also alleged that from the corrigendum dated 27.05.2024,
it is also evident that bid conditions were subsequently changed specifically to ensure
an undue benefit to OP-1 because it has won bids for almost 6 bids out of the 8 alive
bids, without having any expertise for the same. The new condition to Para 4.5 of T&C
introduced vide corrigendum dated 27.05.2024 stating “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” seems to have been conveniently
ignored to favour the bids of OP-1. OP-1, on its website, https:/lpragyawan.com, claims
its areas of business to be:
a. High Density Polyethylene Telecom Duct (HOPE Duct)
b. Engineering, Procurement Construction & Management
c. Edutech
d. Digitisation
e. Training & Capacity Building
f. Solar
g. Project Management Consulting
h. Telecom & Wireless
i. Security & Surveillance
j. Information Education & Communication
12.
To quote its representation on its own website, “Pragyawan Technologies Private
Limited is a diversified business group in various sectors like EPC, Edu Tech Solution,
Digitisation, Security & Surveillance, Project Management, Telecom, Information
Technology and Skill Development Training, Pragyawan provides complete end to end
solutions on SITC (Supply & Installation Technology Communication) basis.” Thus, as
per the Informant, evidently, none of the business in which OP-1’s official website
claims it operates in are even remotely close to those for which NIP dated 27.04.2024
invited the RFPs. Even as per its Memorandum of Association and Articles of
Association uploaded on the MCA Official Website, OP-1 does not manufacture even a
single of the items for which the Toolkits were advertised vide the NIP of 27.04.2024.
13.
Also, according to the Informant, OP-1 does not meet the average annual turnover
criteria for last 3 Financial Years, for 06 out of the 08 remaining RFPs in which it has
technically qualified. This also clearly shows that OP-1 is getting favoured by someone
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from inside either at OP-3 or OP-4 but whatever may be the case, the same is in clear
contravention of the provisions of the Act and amounts to ‘bid rigging’ being a patently
anti-competitive behaviour.
14.
As per the Informant, even re-introduced bid dated 03.08.2024 at OP-5 for ‘Washing
Machines’ also seems materially vitiated where, despite the corrigendum dated
27.05.2024 where the minimum average turnover for previous 3 FYs was fixed at INR
52,65,00,000/-, the RFP now released on OP-5 dated 03.08.2024 reduced the turnover
requirement to INR 33,75,00,000/-. OP-1’s annual financial turnover for the previous 3
years was approx. INR 31.49 crores, when OP-5 re-introduced bid dated 03.08.2024 for
‘Washing Machines’ reducing the minimum average financial turnover to INR 33.75
crores, which also seems to have been done at the behest of OP-1 and the alleged cartel
only, so as to extend benefit to OP-1.
15.
The other amendment introduced vide the corrigendum dated 27.05.2024 in Para No.
4.3 of Instructions to Bidders (‘ITB’) and Annexure IV therein, also, according to the
Informant, inter alia, permitted prospective bidders to submit unaudited provisional
statements of account based on future income, upon certificate of a Chartered
Accountant (‘CA’). This, as per the Informant, was a clear egregious violation of the
Chartered Accountant Act, 1949. The Informant has alleged that this clearly shows that
as the average annual financial turnover of OP-1 for FYs 2020-21, 2021-22 and 2022-
23 was approx. INR 31.49 crores and while the re-issued RFP of Toolkits for
Washermen dated 03.08.2024 reduced the eligibility criteria of average financial
turnover for last 3 FYs to INR 33.75 crores, since OP-1 was still unable to qualify, the
additional relaxation of submitting unaudited provisional statements of account based
on future income, upon certificate of a CA, was also introduced solely to benefit OP-1.
16.
Therefore, in light of the above, the Informant has prayed to the Commission to:
(a) Pass an order under Section 26(1) of the Act directing the Director General to
investigate the matter;
(b) Direct the Director General to call for the Certificate of concerned CA who has
given a certificate to OP-1 with respect to its prospective statements of accounts for
participating in the RFPs concerned in the present information; and investigate the
same;
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(c) Impose maximum penalty on the concerned OPs Nos. 1 to 4 in terms of Section 27
of the Act; and
(d) Pass any other or further order or orders as this Hon’ble Commission may deem fit
in the facts and circumstances of the case and appropriate under the Act.
17.
Further, vide I.A. No. 333 of 2024, the Informant has also sought interim relief as
follows:
(a) direct OP-3, OP-4 and OP-5 to not declare the results of the financial evaluation of
the 8 remaining RFPs, and keep the results in a sealed cover;
(b) direct OP-3, OP-4 and OP-5 to not declare L1 and L2 in respect of the remaining 8
RFPs which were not cancelled on 01.08.2024; and
(c) pass any other or further order or orders as this Hon’ble Commission may deem fit
in the facts of the case.
18.
The Commission considered the Information filed by the Informant in its ordinary
meeting held on 29.01.2025 and decided to pass an appropriate order in the matter.
19.
The Commission notes that in the Information, the following broad allegations seem to
have been made by the Informant:
(a) Non-publication of the NIP by OP-3 and OP-4 on OP-5 in violation of the GFR,
2017;
(b) Cartelisation, bid-rigging and collusive bidding by OP-1 and OP-2 in the tenders of
OP-4, invited by OP-3. Participation of OP-3 and OP-4 in such collusion, has also
been alleged;
(c) Relaxation of eligibility criteria in favour of OP-1, by OP-3 and OP-4; and
(d) OP-1 qualified in certain RFPs invited by OP-3 and OP-4, despite not meeting the
eligibility criteria.
20.
At the outset, in respect of allegations at Sl. No. (a), (c) and (d) above, the Commission
notes that the same, prima facie, do not seem to constitute potential violation of any of
the provisions of the Act. Therefore, the same are not being further examined in the
present order.
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21.
As far as allegations regarding collusive bidding by OP-1 and OP-2 in the RFPs are
concerned, it is noted from the annexures filed with the Information that the status of all
18 RFPs forming part of the NIP, seems to be as follows:
S. No.
RFP For Selection of Vendor
for supply of Toolkits under
PM Vishwakarma Scheme1
Bidders
Result
1
For Washermen
OP-1 and OP-2
Both bidders technically
disqualified
so
tender
cancelled
2
For Tailor
5 including
OP-2
All bidders technically
disqualified
so
tender
cancelled
3
For Sculptor
OP-1 and OP-2
OP-1 recommended for
opening of financial bids
while OP-2 technically
disqualified
4
For Potter
6
including
OP-1 and OP-2
All bidders technically
disqualified
so
tender
cancelled
5
For Mason2
4
including
OP-2
2 bidders recommended
for opening of financial
bids
while
other
2
(including
OP-2)
technically disqualified
6
For Garland Maker
3
including
OP-1 and OP-2
All bidders technically
disqualified
so
tender
cancelled
17
including
OP-1
6 bidders (including OP-
1)
recommended
for
opening of financial bids
while
11
others
technically disqualified
OP-1 declared L6
1 Last date for bidding was 30.05.2024.
2 Due to change in NIT conditions/ specifications, tender cancelled for refloating of revised RFP.
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S. No.
RFP For Selection of Vendor
for supply of Toolkits under
PM Vishwakarma Scheme1
Bidders
Result
7
For Locksmith
12
including
OP-1 and OP-2
3 bidders (including OP-
1)
recommended
for
opening of financial bids
while 9 others (including
OP-2)
technically
disqualified
OP-1 declared L2
8
For Hammer
6
including
OP-1 and OP-2
Only OP-1 recommended
for opening of financial
bids
while
others
(including
OP-2)
technically disqualified
9
For Goldsmith
4
including
OP-1 and OP-2
All bidders technically
disqualified
so
tender
cancelled
10
For Fishing Net Maker
3
including
OP-1 and OP-2
Only OP-1 recommended
for opening of financial
bids
while
other
2
technically disqualified
11
For Doll and Toy Maker
2
including
OP-2
Both bidders technically
disqualified
so
tender
cancelled
14
including
OP-1 and OP-2
4 bidders recommended
for opening of financial
bids
while
10
others
(including OP-1 and OP-
2) technically disqualified
12
For Cobbler
3
including
OP-2
All bidders technically
disqualified
so
tender
cancelled
13
For Carpenter
5
including
OP-1 and OP-2
Only
1
bidder
recommended for opening
of financial bids while
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S. No.
RFP For Selection of Vendor
for supply of Toolkits under
PM Vishwakarma Scheme1
Bidders
Result
other 4 others (including
OP-1
and
OP-2)
technically disqualified
14
For Boat Maker
9
including
OP-1 and OP-2
3 bidders (including OP-
1)
recommended
for
opening of financial bids
while 6 others (including
OP-2)
technically
disqualified
15
For Blacksmith
OP-1 and OP-2
OP-1 recommended for
opening of financial bids
while OP-2 technically
disqualified
16
For Barber
4
including
OP-1 and OP-2
All bidders technically
disqualified
so
tender
cancelled
17
For Armourer
10
including
OP-1 and OP-2
3 bidders (including OP-
1)
recommended
for
opening of financial bids
while 7 others (including
OP-2)
technically
disqualified
18
For Basket Maker
11
including
OP-1
4 bidders (including OP-
1)
recommended
for
opening of financial bids
while 7 others technically
disqualified
OP-1 declared L3
22.
From the above table, which has been prepared basis the documents annexed with the
Information, there is no doubt that OP-1 has been declared technically qualified in
multiple RFPs, while OP-2 has been technically disqualified in all of them. However,
OP-1 does not seem to be the L1 bidder in the any of the RFPs forming part of the NIP
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whose results of financial evaluation have been declared, as has been alleged by the
Informant.
23.
Further, from the above table, no pattern of collusion between OP-1 and OP-2 can be
seen. Also, from the information available in the public domain, it is noted that OP-1 is
a private limited company with registered addresses in Delhi and Noida whereas OP-2
is a private limited company with registered address in Telangana. They seem to have
no common directors and/ or key personnel.
24.
As such, in light of no evidence of any relationship between the two companies, or any
evidence of collusion between them, having been found in the Information or the
Annexures filed therewith, the Commission is of the considered opinion that no prima
facie case of contravention of the provisions of Section 3 of the Act can be made out
against the OPs in the present matter. Hence, the matter is directed to be closed in terms
of the provisions contained in Section 26(2) of the Act. I.A. No. 333 of 2024 also
stands disposed of, accordingly.
25.
The Secretary is directed to communicate to the Informant, accordingly.
Sd/-
(Ravneet Kaur)
Chairperson
Sd/-
(Anil Agrawal)
Member
Sd/-
(Sweta Kakkad)
Member
New Delhi
Date: 03.03.2025
Sd/-
(Deepak Anurag)
Member
