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Zesa smart meter tender challenge dismissed

by Staff reporter
19 Mar 2024 at 17:35hrs | Views
A LOCAL company, Denallare Technologies Pvt Ltd, unsuccessfully filed for an application for condonation at the Supreme Court, challenging the Zimbabwe Electricity Transmission and Distribution Company (ZETDC) and Procurement Regulatory Authority of Zimbabwe (Praz) for "corrupt double procurement" of costly smart meters and flouting tender rules.

The company is the second after the United Kingdom-based Electricity Management Service (EMS) to approach the Supreme Court seeking an order to investigate the flouting of tender rules after Zesa Holdings - the ZETDC holding company - and Praz appointed another company Inhemeter to supply the smart meters which the challengers said are costly to the power utility.

Denallare Technologies, in its application for condonation to appeal to the Supreme Court, cited Praz and Zesa as the first and second respondent respectively.

The company was seeking a condonation and extension of time to file an appeal at the Supreme Court.

Denallare Technologies is a Zimbabwean registered company and is a vendor for the design, configuration and commissioning of pre-payment metering technology (PMT) used in the buying and selling of electricity tokens in 13 southern African countries.

According to court documents, Denallare Technologies won a public tender to configure and install PMT software used by Zesa and the two concluded a contract under which the software was commissioned in April 2013 and upgraded in April 2022.

The contract was set to expire on May 31, 2023.

The court heard that in October 2021 Praz, as a procuring entity, floated tender number ZETDC/INTER/07/2021 for the delivery and supply of new PMT software to replace Denallare's P3 software.

Praz did so for three reasons that the 2013 system only had a life span of 18 months left, that Denallare's software was outdated and too restrictive in that it did not cater for the use of multi-currencies and that it had become too expensive to operate and maintain the system.

However, Denallare did not participate in the tender, but its director who deposed the affidavit, Nick Bakari, represented one of the losing bidders, Electricity Management Services Ltd (EMS), in the tender process.

The tender was won by and awarded to Inhemeter Co Ltd and aggrieved by the loss, EMS filed two applications, case numbers HC 2389/22 and HC 2404/22, in the High Court challenging the awarding of the tender to the winner.

Denallare Technologies, represented by Bakari, also sought to stop the award of the tender to the winner in court case number HC 8954/22, the adverse result of which birthed the present application.

In a further bid to stop the consummation of the contract between Zesa and Inhemeter, Denallare also filed an urgent chamber application in case number HC 2937/23, which it subsequently withdrew.

On March 18, 2022, Denallare, acting as an agent of EMS, requested Praz to investigate the conduct of Zesa in initiating the tender in question.

The court heard that Praz then commenced the investigation by writing to Zesa, but abandoned the investigation after receiving Zesa's response and concluded that going to tender was both a policy and technical decision best left to the procuring entity.

Irked by Praz's conduct, Denallare filed case number HC 8954/22, in the court a quo as a whistleblower for a mandamus [a judicial writ issued as a command to an inferior court or ordering a person to perform a public or statutory duty] to compel Praz to investigate Zesa for what it purported to be a corrupt double procurement.

Denallare also sought for the stay of any resultant acts emanating from the tendering process, pending the investigation, and costs of suit.

Denallare said it was motivated by a civic duty to prevent Zesa from engaging in corruption.

It alleged that the purported corruption arose from the flouting of a costly new PMT tender in the face of Denallare's own extant and proficient system.

However, at hearing, respondents challenged that Denallare lacks locus standi to institute the mandamus proceedings saying, during the tender proceedings, it acted as an agent of EMS.

The respondents also argued that Denallare did not have a cause of action to seek a mandamus and that it had not exhausted the domestic remedies prescribed in the Act before advertising to the Administrative Justice Act (AJA) [Chapter 10:28].

They also argued that the tender had been concluded and implemented, the relief sought was incompetent and the matter was moot.

The lower court, however, found that Denallare lacked the legal standing to challenge the tender proceedings under the Act, the AJA and the 2013 Constitution as it was not a bidder.

But Denallare contended that an investigation could be held even in the face of concluded and effected tender proceedings, saying this was on the basis that one of the remedies contemplated would be the cancellation of any contract concluded from tainted tender proceedings.

Justice Lilian Kudya, however, dismissed the application saying the sole prospective ground of appeal is incomplete in that it would not inform the court and the respondents how the court a quo erred in arriving at that finding.

"The ground of appeal is therefore vague and embarrassing. I also agree ... that the relief sought will be incompetent as, in the event that the prospective appeal succeeds, the court a quo would be obliged to determine the other preliminary points that were raised by the respondents before it can consider the merits," ruled Justice Kudya.

"In view of the above findings, it is not necessary for me to determine whether the application is moot or to delve into the merits of the matter. In the circumstances, it is ordered that the matter be and is hereby struck off the roll and the applicant shall pay the respondents' costs on the ordinary scale."

Source - newsday