GOVERNMENT institutions cannot arbitrarily cancel an accepted tender and give it to another party, the High Court has said.
High Court judge Justice Chandrasiri Kotigalage made the comment in his judgement as he ordered the Land Transport Authority to pay $2000 to a printing company that won the initial tender to print 150,000 wheel tax stickers.
This, as the company, Printhouse Limited filed claims to the tune of $181,500 against LTA.
Justice Kotigalale said all tender procedures and norms involved in the matter were violated by board members causing damage to Printhouse Ltd and the LTA.
"There was an interested person who was on the board of the plaintiff (Printhouse Ld) who obtained sample directly from an interested party Rev Design and signed an agreement with Rev Design for supply of wheel tax stickers long after the plaintiff's (Printhouse Ltd) tender was accepted," he said.
In October 2009, LTA called for tenders to supply various forms, books and labels.
Printhouse Ltd agreed to supply 150,000 stickers for 2010 at $1.23 each.
Justice Kotigalage said LTA placed an order for the immediate supply of 20,000 stickers to the total value of $24,200.
A Local Purchase Order was issued to that effect. But in December of the same year, the order was cancelled.
The court case revealed that Printhouse Ltd had placed an order with the suppliers for 150,000 stickers before applying for the tender.
The court learnt during the trial that Rev Designs was accorded the tender ù even though it did not apply when Printhouse Limited's order was cancelled.
"By the time the tender submitted by the plaintiff (Printhouse) was accepted, the board had directly approved the tender for Rev Design," Justice Kotigalage said.
Issuing a LPO for 20,000 stickers amounted to acceptance of the tender by the plaintiff for 150,000 stickers and the said 200,000 stickers were part of the supply for the tender for 150,000, he said.