Case Note & Summary
The petitioner, Royal Power Turnkey Implements Pvt. Ltd., a private limited company, challenged a tender notice issued by the Maharashtra Industrial Development Corporation (MIDC) for supply of power transformers. The tender notice contained a condition that bidders must have prior experience of executing similar work in MIDC. The petitioner argued that this condition was arbitrary and discriminatory, as it excluded experienced bidders who had not worked with MIDC but had executed similar work for other government or private entities. The court examined the condition and found that it had no rational nexus with the object of ensuring quality work. The court noted that the condition was not necessary for assessing the technical capability of bidders and that it stifled competition. The court held that the condition was violative of Article 14 of the Constitution of India, which guarantees equality before law. The court quashed the tender notice to the extent of the impugned condition and directed MIDC to re-invite tenders without such condition. The court also observed that the condition was unreasonable and arbitrary, and that it was not based on any valid classification. The judgment emphasizes that tender conditions must be reasonable, non-discriminatory, and based on rational criteria.
Headnote
A) Constitutional Law - Article 14 - Reasonableness of Tender Conditions - Condition requiring prior experience of executing similar work in MIDC held arbitrary and unreasonable - The court held that such a condition is discriminatory and stifles competition, as it is not based on any rational nexus with the object of ensuring quality work. (Paras 1-5) B) Administrative Law - Judicial Review of Tender Conditions - Scope of interference - Courts can interfere if the condition is arbitrary, discriminatory, or mala fide - The impugned condition was struck down as it was not necessary for ensuring the quality of work and was contrary to public interest. (Paras 1-5)
Issue of Consideration
Whether a condition in a tender notice requiring bidders to have prior experience of executing similar work in MIDC is arbitrary and violative of Article 14 of the Constitution of India.
Final Decision
The court allowed the writ petition, quashed the tender notice to the extent of the impugned condition, and directed MIDC to re-invite tenders without such condition.
Law Points
- Tender condition must be reasonable and non-discriminatory
- Article 14 of the Constitution of India
- Judicial review of tender conditions
- Doctrine of unreasonableness
