Case Note & Summary
The petitioner, M/s. Mahalasa Service, a sole proprietorship, challenged the termination of a tender process dated 22/05/2013 issued by Goa Shipyard Limited (respondent no.1) for housekeeping services, and the subsequent disqualification of the petitioner in a fresh tender process dated 04/09/2013. The petitioner had been the lowest bidder in the first tender, but the tender was cancelled without any valid reason. In the second tender, the petitioner was disqualified as technically ineligible for not having a Permanent Account Number (PAN) card, though the tender conditions did not require it at the time of submission. The petitioner sought quashing of the cancellation and disqualification, and direction to consider its quotation. The court held that the cancellation of the first tender was arbitrary as no reasons were given, and the disqualification in the second tender was unreasonable because the PAN card requirement was not part of the tender conditions. The court allowed the petition, quashing the cancellation and disqualification, and directed respondent no.1 to consider the petitioner's quotation in the first tender.
Headnote
A) Public Procurement - Tender Process - Arbitrariness - Article 14 of the Constitution of India - The court examined whether the cancellation of the first tender and the disqualification of the petitioner in the second tender were arbitrary. Held that the decision to cancel the first tender was not based on any valid reason and the disqualification of the petitioner for not having a PAN card was unreasonable as the tender conditions did not require it at the time of submission. (Paras 3-10) B) Judicial Review - Tender Matters - Scope - Article 226 of the Constitution of India - The court reiterated that the scope of judicial review in tender matters is limited to examining whether the decision-making process is arbitrary, irrational, or mala fide. Held that the impugned actions were arbitrary and thus liable to be set aside. (Paras 11-15) C) Public Procurement - Level Playing Field - Technical Eligibility - The court considered whether the requirement of a PAN card could be introduced after the tender process had begun. Held that such a requirement could not be imposed retrospectively to disqualify a bidder who was otherwise the lowest bidder. (Paras 16-20)
Issue of Consideration
Whether the termination of the first tender process dated 22/05/2013 and the disqualification of the petitioner as technically ineligible in the second tender process were arbitrary and violative of Article 14 of the Constitution of India.
Final Decision
The petition is allowed. The termination of the first tender process dated 22/05/2013 and the disqualification of the petitioner in the second tender process are quashed and set aside. Respondent No.1 is directed to consider the quotation of the petitioner in the first tender process.
Law Points
- Public procurement
- Tender law
- Article 226
- Judicial review
- Arbitrariness
- Level playing field
- Technical eligibility
- Cancellation of tender
- Reasonableness
