Case Note & Summary
The appellant, Mahindra Sanyo Special Steel Private Limited, an unsuccessful bidder, filed a writ petition challenging the rejection of its bid in Tender No. 201710849 issued by the Rail Wheel Factory, Indian Railways. The appellant sought a writ of mandamus to include its bid or alternatively to declare the tender proceedings illegal and direct re-tendering. The Single Judge dismissed the writ petition on 27.8.2018. The appellant appealed under Section 4 of the Karnataka High Court Act. The Division Bench, comprising Justice Raghvendra S. Chauhan and Justice B.M. Shyam Prasad, heard the appeal. The facts revealed that the tender required submission of certain documents, including a 'Consent Letter' from the manufacturer. The appellant failed to submit the required consent letter, leading to rejection of its bid. The appellant argued that the condition was not mandatory and that the rejection was arbitrary. The respondents contended that the condition was essential and that the appellant's bid was rightly rejected. The court analyzed the tender conditions and found that the requirement of the consent letter was a mandatory condition. The court held that the appellant's failure to comply with this condition justified the rejection. The court further held that the decision-making process was not arbitrary or irrational, and therefore, no interference was warranted. The appeal was dismissed, and the order of the Single Judge was upheld.
Headnote
A) Tender Law - Judicial Review - Scope of Interference - The court's power of judicial review in tender matters is limited to examining whether the decision-making process is arbitrary, irrational, or mala fide. The court cannot substitute its own view for that of the tender inviting authority. (Paras 1-10) B) Tender Law - Compliance with Tender Conditions - Mandatory Requirements - A bidder must strictly comply with the essential conditions of the tender. Non-compliance with a mandatory condition, such as submission of a required document, justifies rejection of the bid. (Paras 2-8) C) Tender Law - Alternative Relief - Re-tendering - The court will not direct re-tendering unless the tender process is vitiated by illegality or arbitrariness. Mere non-inclusion of a bid does not warrant re-tendering. (Paras 9-10)
Issue of Consideration
Whether the rejection of the appellant's bid by the respondent was arbitrary and illegal, and whether the appellant was entitled to a writ of mandamus for inclusion of its bid or re-tendering.
Final Decision
The appeal is dismissed. The order of the Single Judge dated 27.8.2018 in Writ Petition No.14847/2018 is upheld.
Law Points
- Tender law
- Judicial review of tender decisions
- Compliance with tender conditions
- Scope of writ jurisdiction in contractual matters
