Case Note & Summary
The matter concerned a writ petition under Article 226 of the Constitution of India filed before the Bombay High Court by a public limited company against Sangli Miraj Kupwad Municipal Corporation and another company. The dispute arose from a tender floated on 26 March 2021 for implementation of energy efficiency measures in public street lighting, including replacement with smart LED streetlights and installation of a centralised control monitoring system on an ESCO basis. Two corrigenda were issued on 8 April and 12 April 2021 modifying tender clauses. The petitioner and respondent No.2 were the only two bidders who submitted technical and financial bids. After scrutiny, respondent No.1 asked the petitioner to furnish certain documents including PAN Card, Udham Registration Certificate, NSIC Certificate and non-infringement of patent, which the petitioner claimed to have supplied. The petitioner inspected respondent No.2's documents and found that respondent No.2's turnover certificate for FY 2017-18 showed Rs.653.32 lakhs, which was less than the minimum annual turnover of Rs.15 crores required for the last three financial years under Clause 3.1.II of the tender. The petitioner raised objections on 19 June 2021. On 28 June 2021, respondent No.1 opened technical bids and prepared an evaluation report rejecting the petitioner's technical bid and accepting respondent No.2's bid. The petitioner alleged arbitrary rejection and hurried refund of its EMD, indicating favouritism. Respondent No.1 contended that the petitioner's documents were incomplete or expired, that respondent No.2's documents were complete, and that respondent No.2 fulfilled the turnover requirement. It also contended that the tender process was transparent and that the petitioner's objections were received beyond the stipulated time. The court noted the settled principle that courts should ordinarily not interfere in tender matters unless substantial public interest is involved or the transaction is malafide, and must proceed with caution. It examined the qualification criteria and arguments regarding extension of bid submission dates. The available judgment text ended with the court perusing the addenda, without including the final decision or operative directions, and therefore the final holding could not be determined from the provided text.
Headnote
A) Constitutional Law - Writ Jurisdiction - Judicial Review of Tenders - Article 226 of Constitution of India - The court examined a writ petition challenging municipal tender decisions and noted the settled principle that courts should ordinarily not interfere in tender matters unless substantial public interest is involved or the transaction is malafide; courts must proceed with great caution in exercising discretionary powers. Held that judicial review in tender matters is limited and should be exercised only in furtherance of public interest. (Paras 8-10) B) Tender Law - Eligibility Criteria - Minimum Turnover Requirement - Clause 3.1.II of Tender Document - The tender required a bidder to have minimum average annual turnover over INR 15 crores for last three financial years FY 2017-18, FY 2018-19 and FY 2019-20; Petitioner alleged Respondent No.2's turnover for FY 2017-18 was Rs.653.32 lakhs i.e. Rs.6.53 crores, much less than required; Respondent No.1 contended that the requirement was fulfilled by Respondent No.2. The court did not make a final determination on this issue in the available text. (Paras 2(d), 5, 7) C) Tender Law - Technical Bid Evaluation - Rejection of Technical Bid - Tender Document / Municipal Corporation - Respondent No.1 rejected Petitioner's technical bid on ground that certain documents were not annexed or were expired, while accepting Respondent No.2's bid as complete in all respects; Petitioner challenged the rejection as arbitrary and unreasonable, contending all documents were submitted. The court noted the evaluation committee report but did not deliver a final ruling on this issue in the available text. (Paras 2(e), 4) D) Tender Law - Procedural Compliance - Extension of Bid Submission Date - Tender Addenda - Petitioner contended that the last date of submission of tender was extended from 28 May 2021 to 14 June 2021 on the last date itself, contrary to the addenda which required extension at least two days prior to final date; the court perused the addenda of the tender to examine this contention. The available text ended without a final ruling on this issue. (Paras 9-10)
Issue of Consideration
Whether the High Court should interfere with tender evaluation decisions under Article 226 in absence of substantial public interest or malafide; whether Respondent No.2 fulfilled the minimum annual turnover requirement of Rs.15 crores for last three years; whether the technical bid of Petitioner was rightly rejected for non-submission or expiry of documents; whether the extension of tender submission date was valid under the addenda
Law Points
- Courts should ordinarily not interfere in tender matters unless substantial public interest is involved or the transaction is malafide
- judicial review of tender decisions is limited
- courts must proceed with caution in exercising discretionary powers
- tender eligibility criteria must be applied fairly
- minimum annual turnover requirement must be strictly construed
- bidder's technical bid rejection can be challenged under Article 226
