Delhi High Court Upholds Tender Condition Prioritizing BSVI/CNG Vehicles: Tendering Authorities Have Autonomy in Setting Tender Terms - 2025-03-06

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Delhi High Court Affirms Tender Condition Favoring BSVI/CNG Vehicles in Food Transportation

New Delhi, March 5, 2025 – The Delhi High Court, presided over by Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela , has dismissed a petition challenging a tender condition that excluded BSIV GPS enabled trucks for the transportation of food articles in Delhi. The court upheld the autonomy of tendering authorities in setting tender conditions, emphasizing that judicial review should be limited unless decisions are arbitrary, mala fide, or against public interest.

Background of the Case

Shri Ruchit Bansal and another petitioner filed a writ petition (W.P.(C) 2660/2025) against the Government of NCT of Delhi and the Delhi State Civil Supplies Corporation Limited. They challenged condition no. 3 of an e-tender for the transportation of wheat and rice from Food Corporation of India (FCI) godowns to fair price shops, arguing that excluding BSIV vehicles was illegal and against previous court orders. The petitioners also sought an extension of their existing contract based on a clause in the previous tender from 2022.

Petitioners' Arguments

The petitioners contended that:

• Violation of NGT and Supreme Court Orders: Excluding BSIV vehicles contravenes orders from the National Green Tribunal (NGT) and the Supreme Court.
• Contradiction of Previous Court Judgment: A Coordinate Bench of the Delhi High Court previously upheld the inclusion of BSIV vehicles in a 2022 tender.
• Mala Fide Intention: The exclusion of BSIV vehicles was a mala fide attempt to oust them from the tender and benefit tenderers with BSVI/CNG vehicles.
• Existing Contract Extension: They were entitled to a one-year extension of their current contract based on Clause 4 of the 2022 tender conditions and past practices.

Respondents' Counter-Arguments

The respondents, represented by the Delhi State Civil Supplies Corporation Limited, argued that:

• Tendering Authority's Prerogative: The tendering authority is best positioned to determine tender conditions in public interest.
• Public Interest and Pollution Control: The decision to only permit BSVI/CNG vehicles was taken to mitigate air pollution in Delhi, serving a larger public interest.
• Changed Circumstances: The previous decision to allow BSIV vehicles was due to the COVID-19 pandemic and the Pradhan Mantri Gareeb Kalyan Anna Yojana (PMGKAY), which increased the need for transport. With the withdrawal of PMGKAY, fewer vehicles are required, making stricter environmental conditions feasible.
• No Right to Contract Extension: Clause 4 of the previous tender did not guarantee a one-year extension without mutual consent from the Corporation.

Court's Observations and Rationale

The High Court sided with the respondents, rejecting the petitioners' claims. Key observations from the judgment include:

• Limited Right to Contract Extension: The court clarified that Clause 4 of the 2022 tender required mutual consent for a one-year extension, which was absent in this case. "We are of the considered opinion that petitioners do not have any indefeasible right to seek extension; such extension is legally permissible only if respondent no.2/Corporation also expresses its consent."

• No Contravention of Orders or Previous Judgment: The court distinguished the present scenario from previous orders and judgments, stating, "the orders passed by the NGT and the Hon’ble Supreme Court only permitted registration of BSIV compliant vehicles to be used for essential service, however, such orders…cannot be construed to mean that a tendering authority…is under any obligation to necessarily include use of BSIV compliant vehicles." It further clarified that the previous judgment upholding BSIV vehicle use was in a different context (COVID-19, PMGKAY).

• Tendering Authority's Discretion and Public Interest: The court emphasized the principle of judicial restraint in tender matters, quoting Supreme Court precedents like Municipal Corpn., Ujjain v. BVG India Ltd. and Silppi Constructions Contractors v. Union of India. It reiterated that "courts should exercise a lot of restraint while exercising their powers of judicial review in contractual or commercial matters." The court found the exclusion of BSIV vehicles to be a valid measure in public interest to combat air pollution. "if the use of BSIV compliant vehicles has not been permitted, the same cannot be said to arbitrary for the reason that such exclusion appears to be one of the measures taken for mitigating the ever deteriorating air quality in NCT of Delhi."

• Rejection of Mala Fide Allegations: The court found no evidence to support the petitioners' claim of mala fide intention, stating that "apart from asserting the ground of mala fide, the petition does not contain any material to establish that the use of BSIV vehicles has been excluded from the subject tender with a view to favor any particular tenderer or oust the participation of the petitioner from the tender process."

Final Decision and Implications

The Delhi High Court dismissed the writ petition and the pending application, upholding the validity of the tender condition excluding BSIV vehicles. This judgment reinforces the principle that tendering authorities have significant autonomy in setting tender conditions and courts will generally not interfere unless there is clear arbitrariness, mala fide, or a violation of public interest. The decision also highlights the increasing consideration of environmental factors in government tenders and procurement processes.

Case Citation: W.P.(C) 2660/2025 & CM APPL. 12638/2025, Shri Ruchit Bansal & Anr. Versus Govt of NCT Of Delhi & Anr.

Bench: Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela

Date of Judgment: March 05, 2025 ```