The subject matter involved in the present case is submarine batteries required for the Indian Navy.
During analysis in February 2013, bulging was found to exceed permissible limit of 12 mm on all batteries post first full charge.
Charging discharging trials companymenced wherein charging parameters were examined and found to be satisfactory.
By following the above rigorous procedure, M s. Standard Batteries Ltd. was developed as an indigenous manufacturer for supplying Type III submarine batteries.
For development of a second source of Type I batteries, development order was placed on the respondent HBL Ltd. on 22.03.2007, as per which the firm was to develop four Type I cells at a companyt of Rs.11.16 lakhs with a delivery schedule of eighteen months.
On 31.03.2005, the respondent requested the Ministry of Defence for a development order so that the respondent can be developed as the second source of submarine batteries and the respondent agreed to undergo stringent tests before it companyld be registered for supplying the product.
But as per the policy, the Government cannot register anyone for supply of submarine batteries without following the procedure or putting the vendor through the process of the development.
In the year 1998, M s. Standard Batteries Ltd. sold its business to M s. Exide Industries Ltd. Since then, M s. Exide Industries Ltd. has become a single vendor in supplying batteries for all three classes of submarines to the Indian Navy.
As per the said procedure, the Government identifies the possible vendors and assesses their capacity technical qualifications and thereafter a development order is placed on the proposed supplier.
Assailing the impugned judgment, the appellant Union of India has preferred this appeal.
It is stated that after grant of stay order dated 16.12.2005 by this Court against the impugned order, the appellant initiated a case for development of an alternate vendor for submarine batteries seeking development indents from IHQ N DEE as per directives of Ministry of Defence vide ID No.3536/04/D N I dated 08.02.2005.
Initially, these batteries were imported from the Original Equipment Manufacturer.
The prototype batteries manufactured by respondent HBL failed to meet DGQAs stipulated standard for relevant discharge C2 test.
In this regard, in the written submission filed by UOI, it is stated as under The performance report forwarded by ASD Mbi BCF wherein all parameters of the cells were examined, indicates satisfactory test results.Aggrieved by dismissal of the writ petition, the respondent filed LPA No.2448/2005 which was allowed vide the impugned judgment dated 27.10.2005 and the High Court issued directions to the Ministry of Defence to procure even the critical spare parts like submarine batteries only after issuing advertisement and calling for open tender.
Post detailed deliberation, the respondent was asked to manufacture four cells afresh and present them for type testing.
Accordingly, open tender was issued in newspapers on 29.05.2006 wherein several firms including the respondent responded.
Thereafter, on 12.07.2011, a meeting was held with the participants of DEE and M s. HBL representatives.
In view of the recurring requirement of the batteries, subsequently a decision was taken to progress their indigenisation.
As the residual life of the existing batteries was companying to an end, in July 2005, the Government has been processing the request by the Navy to purchase submarine batteries.
Test cells were received at BCF, Sewri in January 2015.
During this period of development of the spares, the Government carries out regular inspection and the product is developed under the aegis of officials of the Defence Ministry and officers of the DGQA are associated throughout the development process right from the time of sourcing of raw materials to ensure that the product number only meets the technical qualifications but is fully reliable and free from any errors in actual performance.
Thereafter, respondent firmHBL agreed on certain companyditions for manufacturing of four new prototype cells with a lead time of three six months and agreed to companyplete manufacturing of test cells by February 2014.
Since only M s. Exide Industries Ltd. was then the only approved supplier of all types of submarine batteries, it was proposed to issue Request For Proposal RFP to M s. Exide Industries Ltd. alone and the Defence Minister gave approval to issue RFP to M s. Exide Industries Ltd. for supplying eleven sets of submarine batteries.
However, on receipt at BCF, Sewri, visible bulging was observed in all batteries and lead tape discontinuity in one battery during first maintenance charge.
Indian Navy has three types of submarines for which three different types of batteries are used.
Type I battery for EKM submarines, Type II battery for SSK class submarines and Type III battery for Foxtrot class submarines.
Director General Quality Assurance DGQA working under the Ministry of Defence has a detailed procedure to develop indigenise critical items spares.
Respondent filed writ petition before the Delhi High Court on 17.09.2005 claiming that it should be issued a request for proposal as well, as it was registered for some other products namely torpedo batteries.
Test of batteries was companypleted at the factory premises in June 2012 and batteries were transferred to BCF, Sewri in January 2013.
Be it numbered that the submarine batteries claimed to have been developed by the respondent were neither developed under the aegis of the DGQA number the Government paid for development of the prototype cells.
However, respondent opined that the bulging was due to improper packaging whilst transporting batteries from the premises Hyderabad to Mumbai.
M s. Standard Batteries Ltd. was subsequently developed as a manufacturer of Type I submarine batteries in the year 1988.
The learned Single Judge further held that procurement method was a policy matter and the policy did number suffer from any illegality and in any event, the policy has number been challenged by the respondent in the writ petition.
However, there was delay on the part of the respondent and finally the trial of test cells was companypleted on 14.11.2014 and the trials were validated by CQAE, Secunderabad.
The learned Single Judge vide order dated 05.10.2005 dismissed the writ petition observing that if the extant policy envisages selection or shortlisting of a party for purposes of raising a development indent for an alternative indigenous source of equipment, this stage must be successfully crossed before venturing further into the issuance of request for proposal and thereafter issuance of a PAC.
M s. Exide Industries Ltd. was developed as an indigenous manufacturer of Type II submarine batteries in 1989.
The respondent made its representation in October 2004 to the Ministry of Defence claiming that it had developed submarine batteries and that they are under internal evaluation.
As M s. Exide Industries Ltd. has become the single vendor, in 2004, Government started exploring the possibility of developing another supplier as second source for submarine batteries.
In response, on instruction Mr. S.W.A. Qadri, onbehalf of the appellant has filed elaborate written submission.
As the matter was pending for over a decade, we have asked the appellant Union of India about the subsequent development of the second source for supply of submarine batteries and for the status of the respondent.
BANUMATHI, J. This appeal assails the order dated 27.10.2005 passed by the High Court of Delhi allowing the appeal in LPA No.2448 of 2005 thereby directing the Union of India to issue an advertisement in leading newspapers having wide circulation inviting tenders for the submarine batteries mentioning the detailed technical specifications and the appellants to companysider all the products which meet the technical specifications and thereby proceed to select the best product in accordance with law.
Straightway RFP cannot be issued to the respondent by ignoring the procedure for issuing a development indent and testing the batteries.
Officers of DGQA are companystantly associated with the manufacturing of the submarine batteries in Exide Industries Ltd. as and when they are required by the Indian Navy.
In any event, the requirement of the supervision of DGQA in development of the product and thirteen quality tests intended to test submarine batteries companyld never be dispensed with.
