BUREAU VERITAS, represented by THEODOR H. HUNERMANN, vs. OFFICE OF THE PRESIDENT, SECRETARY OF FINANCE, SECRETARY OF TRADE AND INDUSTRY, and GOVERNOR OF THE CENTRAL BANK OF THE PHILIPPINES (as Chairman and members of the COMMITTEE ON IMPORT SUPERVISION SCHEME), COMMISSIONER OF CUSTOMS, FINANCE…
- G.R. Number: G.R. No. 101678
- Promulgated: 1992-02-03
- Ponente: Melencio-Herrera, J.
Doctrine
Where an Invitation to Bid expressly reserves the government's right to reject any or all bids or waive defects, the highest or lowest bidder is not entitled to award as a matter of right.
The discretion to accept or reject bids is wide; the Court will only intervene when the discretion is used as a shield for fraudulent or whimsical action.
In awarding the contract, the controlling criterion was securing the most advantageous offer to the Government—one key consideration being the least government payout.
Facts
Petitioner Bureau Veritas filed a petition for certiorari and mandamus to challenge the Agreement for Comprehensive Import Supervision Scheme (CISS) between the Republic and SGS and Memorandum Order No. 391 approving it.
Bidders met with the CISS Subcommittee; the Subcommittee asked whether bids should be evaluated net of taxes because bidders quoted unequal tax rates, and it stated bidders were bound by what they expressly stated in their bids.
The CISS Subcommittee compared bids and recommended awarding a global contract to SGS, citing a lower total fee and congressional sentiment to appoint the most competent pre-inspection agent.
Public respondents also considered additional advantages offered by SGS, such as training courses, computerization, consultancy, library development, and provision of an X-ray van.
Issues
Whether public respondents committed grave abuse of discretion in awarding and approving the CISS contract to SGS.
Whether public respondents gravely abused their discretion in changing the rule on evaluating bids from inclusive to exclusive of taxes (net basis) and in refusing to consider Petitioner's revised fees after tax deductions.
Whether Petitioner had actually imputed taxes in its original bid such that its revised fee submission should have been considered.
Ruling
The Court found no grave abuse of discretion in awarding the CISS contract to SGS and dismissed the petition.
The Court held Petitioner did not impute a tax rate other than a de facto zero rate (i.e., it submitted a net bid assuming tax exemption), so rejection of Petitioner's revised fees was not grave abuse.
The Court will not disturb the government's exercise of discretion in awarding contracts where an express reservation to reject or accept bids exists and no unfairness or fraud is shown.
Keywords
G.R. No. 101678, Petition for Certiorari and Mandamus, Preliminary Injunction, Temporary Restraining Order, Agreement for Comprehensive Import Supervision Scheme (CISS), Memorandum Order No. 391, pre-shipment inspection, Clean Report of Finding (CRF), Letters of Credit (L/Cs), undervaluation, misdeclaration and overvaluation of imports, bidding process, right to reject any or all bids, fees based on FOB value inclusive of Philippine taxes, BIR Ruling 537, net basis evaluation, tax exemption, most advantageous to the government, lowest bidder, government, rollo