Can quotations be opened without the presence of the bidders?
K.K.Ganguly
(Querist) 22 March 2012
This query is : Resolved
Would the Ld. Experts kindly opine?
1) One Securitisation Company advertised for bids for selling a property at Kolkata at Rs.25.25 lacs as reserved price asking the bids to be submitted in sealed cover to be deposited on 01.03.2012 at 1PM & to be opened at 03 PM in presence of the bidders.
2) They again advertised in papers stating that they received only one bid for Rs.15 lacs i.e. much below the reserved price & asked members of public to bid for the same and quote price above Rs.15 lacs within 10 days.
3) They also stated in the said 2nd advertisement that if they do not get any higher bid with in next 10 days, they will confirm the sale to the first bidder who quoted Rs.15 lacs.They have not informed when they will open the envelops in presence of the bidders. They also have informed about their offering to sell at a price less than the reserved price to the borrower.
My question is
a) Can the Securitisation Company ask for the 2nd biddings at a price below the reserved price & follow the procedure of opening the envelopes containing the offers in absence of the bidders? We understand that there is an effort by an officer to secretly buy the property at a much lower price by abusing the law. When bids are not opened in presence of the bidders there is room for price manipulation.
b) What should be done by the borrower for stopping the process of sale by this type of tender.
Guest
(Expert) 24 March 2012
Dear Shri Ganguly,
Although the company is not bound to wait for the bidder to be present at the pre-fixed bid opening time and can open the bids, but your observation is quit correct about some corrupt practices , like intention to sell the property at much low price than the reserved price to some company employee. Irregularity is quite evident on three counts, as follows:
1)In the case of sealed cover bids, the company should not have opened the bid if they wanted to extend the date for bids on account of single bid.
2) The company, if opened the bid and found the bid to be of much lower than the reserved price, should have cancelled the tender and fresh tenders were required to be called with the reserved price or revised reserved price.
3) Even if the company desired to extend date for bids after opening the bid, it should not have revealed the price of the existing bid (Rs.15 Lakhs). That clearly intended to call for the bids within the range of 15 lakhs only. The company was required to give its revised reserved price.
