Recognition as illegal and cancellation of the notification of the elimination of violations identified by the results of desk control
The Court of appeal made an erroneous interpretation of the norms of substantive law.
No.6001-23-00-6ap/124 (5), (6), (7), (8) dated 05/25/2023
Plaintiff: "S" LLP
The defendants are: State Institution "Department of Housing and Communal Services, Passenger Transport and Highways", State Institution "Committee of Internal State Audit of the Ministry of Finance of the Republic of Kazakhstan" (hereinafter referred to as the Committee), State Institution "Public Procurement Department" (hereinafter referred to as the Department), State Institution "Department of Internal State Audit of the Committee of Internal State Audit of the Ministry of Finance of the Republic of Kazakhstan" (hereinafter referred to as the Committee). Department)
Interested parties: State Institution "Department of Housing and Communal Services, passenger transport and highways", LLP "ZHE"
The subject of the dispute: on the recognition as illegal and cancellation of the notification of the elimination of violations identified by the results of desk control, the conclusion of quality control, the protocol on the results of the competition, the compulsion to review the results of the public procurement competition and an unfavorable administrative act
Review of cassation complaints the defendants are from an interested party.
PLOT:
The Partnership, ZHE LLP and other potential suppliers participated in the Management's public procurement competition for works No. 7544538-OK1 "Construction of sewer networks" lot No. 52590611-OK1 "Works on the construction of sewage systems/water treatment plants/pumping stations".The protocol on the results of 07/08/2022 recognizes the company as the winner with a conditional 10% discount on work experience, and ZHE LLP with a conditional 6.6% discount is recognized as the potential supplier who took the second place.
On 07/29/2022, based on the results of consideration of the complaint of ZHE LLP, the Department issued a notification on the elimination of violations identified by the results of desk control, according to which a conditional 8.6% discount was determined for the work experience of ZHE LLP.
On 08/10/2022, the Quality Control Committee made changes (additions) to the above-mentioned notification of the elimination of violations identified by the results of desk control.
On 08/15/2022, the Department issued a new notification on the elimination of violations identified by the results of desk control by obtaining a conditional discount of 10% from ZHE LLP.
On 08/19/2022, the Management summed up the repeated results of the competition, according to the results of which ZHE LLP was recognized as the winner, the Partnership was the second-place supplier, with a conditional discount of 13% (work experience - 10, tax paid - 3), and 11.8% for the plaintiff (work experience - 10, taxes paid - 1.8)..
The plaintiff did not agree with the repeated results of the competition.
Judicial acts:
1st instance: the claim was denied. By a private definition, the Department was informed of violations of the law committed by the chief specialist A.A.
Appeal: the decision has been changed. The court's decision regarding the dismissal of the claim was overturned with the issuance of a new decision on the satisfaction of the claim.
It was decided: to declare illegal and cancel the conclusion of the Quality Control Committee dated 08/10/2022; the Department's notification dated 08/15/2022; the protocol on the results dated 08/19/2022; to oblige the Management to review the results of the competition within one month from the date of entry into force of the resolution. The rest of the court's decision remains unchanged.
A private definition has been brought to the attention of the Treasury Committee of the Ministry of Finance of the Republic of Kazakhstan for appropriate measures.
Cassation: the decision is overturned, the decision is upheld.
Conclusions:
The Court of first instance motivated the refusal by the fact that, according to paragraph 274, the Rules for public procurement approved by the Order of the Minister of Finance of the Republic of Kazakhstan dated December 11, 2015 No. 648 (hereinafter - Rules No. 648) when carrying out public procurement of construction works (construction, installation and design works), information and documents confirming the work experience of a potential supplier located in an electronic depository with the status "Confirmed" are taken into account by the tender commission and are not subject to appeal in accordance with Article 47 of the Law of the Republic of Kazakhstan "On Public Procurement". Thus, the court took into account the information and documents confirming the work experience of the potential supplier of ZHE LLP for 16 facilities verified by the authorized body.
Disagreeing with the above conclusions of the court of first instance, the court of appeal declared the contested notification unlawful,38 pointing out that the court of first instance unreasonably applied paragraph 274 of Rules No. 648 to disputed legal relations, as amended from July 1, 2022. In the opinion of the appellate instance, the verification of information in the electronic depository did not exempt the tender commission and the authorized body from checking them, and since the certificates of completed works of JSC "Housing and Communal Services" for 12 facilities do not have the signature of the customer, the information on them is inapplicable.
The judicial board considered these conclusions of the court of appeal to be inconsistent with the circumstances of the case and the requirements of the law.
Paragraph 13 of the NPA dated April 21, 2022 "On the application of the Law on Public Procurement to Courts" stipulates that an electronic depository in the field of public procurement is an electronic database containing information and documents confirming the existence of work experience of potential suppliers, generated on the web portal of public procurement. The electronic depository is formed by an authorized body and its territorial divisions. Applications from potential suppliers for entering information and documents into the electronic depository confirming their work experience over the past ten years, including for the current year, are formed by a potential supplier and submitted through a web portal, in accordance with Appendix 5 to the Rules. Applications from potential suppliers are reviewed by the authorized body and its territorial divisions within ten working days. Information and documents are entered into the electronic depository by the authorized body after confirmation of their authenticity.
Thus, the information on the qualifications of ZHE LLP indicates the availability of work experience on 16 objects similar to those purchased at the end of the course, information and documents on them have been entered into the electronic depository with the status "Confirmed". This information has not been disputed or canceled by anyone, and the plaintiff has not filed any relevant claims.
This status is assigned on the basis of information from the treasury authorities, acts of the state acceptance commission on the acceptance of the facility for operation, which indicates the contractor who carried out the construction.
The mentioned acts of the acceptance commission for all 16 objects have been investigated by the judicial board, and in their form and content they comply with the declared requirements.
The application by the court of first instance of paragraph 274 of Rules No. 648 of the injunction, which did not enter into force at the time of the competition, does not affect the legality of its decision, since information about confirmed work experience has not been refuted in accordance with the procedure established by law.
By virtue of parts one and two of Article 10 of the CPC, when exercising administrative discretion, an administrative body or official ensures a fair balance of interests between the participant in the administrative procedure and the company. At the same time, an administrative act, administrative action (inaction) must be proportionate, that is, suitable, necessary and proportional.
Violation of the principles of administrative procedures and administrative proceedings, depending on its nature and materiality, in accordance with the requirements of part four of Article 6 of the CPC, led to the cancellation of the judicial acts of the appellate instance.
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