Case Note & Summary
The Petitioner, KSS Petron Pvt. Ltd., challenged a communication dated 6th January 2014 from Respondent No.1, Oil and Natural Gas Corporation Ltd. (ONGC), informing that the price bid of Respondent No.2, Technip KT India Ltd., would be opened pursuant to a representation made by Technip against the rejection of its technical bid. The tender was for setting up new Onshore Terminal Facilities at Odalarevu. ONGC had initially rejected Technip's technical bid due to deficiencies including lack of proper power of attorney, failure to provide agreement with parent company, and non-compliant parent company guarantee. Technip subsequently submitted a power of attorney and made representations to the Independent External Monitor (IEM), who recommended that the deficiencies were curable. ONGC accepted the recommendation and decided to open Technip's price bid. The Petitioner argued that the tender conditions required strict compliance and that allowing Technip to cure deficiencies after the bid deadline was arbitrary and violated Article 14. The court held that the deficiencies were not fundamental and could be cured, and that ONGC's decision, based on the IEM's recommendation, was not arbitrary. The court dismissed the petition, finding no merit in the challenge.
Headnote
A) Tender Law - Judicial Review - Scope of Interference - The court's power to interfere in tender matters is limited to cases of arbitrariness, mala fides, or bias. The court will not sit in appeal over the decision of the tendering authority unless the decision is perverse or unreasonable. (Paras 1-10) B) Tender Law - Technical Bid Evaluation - Curable Deficiencies - Deficiencies in a technical bid that are not fundamental and can be cured by subsequent compliance may be considered curable. The decision of the tendering authority to allow cure of such deficiencies, especially after review by an Independent External Monitor, is not arbitrary. (Paras 11-20) C) Tender Law - Independent External Monitor - Role - The recommendation of an Independent External Monitor appointed under the tender process carries weight and the tendering authority is entitled to rely on it. The court will not lightly interfere with such recommendations. (Paras 21-25)
Issue of Consideration
Whether the decision of Respondent No.1 to accept the representation of Respondent No.2 and open its price bid after initial rejection of its technical bid is arbitrary and violative of Article 14 of the Constitution of India.
Final Decision
Writ Petition dismissed. No order as to costs.
Law Points
- Tender law
- Judicial review limited to arbitrariness
- mala fides or bias
- Compliance with tender conditions
- Role of Independent External Monitor
- Curable deficiencies in technical bid
