2019 Supreme(SC) 419

SUPREME COURT OF INDIA
S.A. BOBDE, SANJAY KISHAN KAUL, JJ.
Caretel Infotech Ltd. – Appellant
Versus
Hindustan Petroleum Corporation Limited and Others – Respondents
Civil Appeal No. 3588 of 2019, SLP (C) No. 46 of 2019
Decided On : 09-04-2019

IMPORTANT POINTS
Blacklisting is always prospective.
Debarring a bidder only on basis of show cause notice as to why action should not be initiated for its blacklisting cannot be sustained because the show cause notice may result either way: the bidder may or may not be blacklisted.
Writ Court does not sit in appeal over administrative decisions.
Approach of challenging every small or big tender under Article 226 as a matter of routine deprecated.
View of the author of document in interpreting it must prevail.

Headnote:(a) Government contract – Clause 20 of contract and Format – Specifically requiring disclosure of three conditions : banned, blacklisted or put on holiday list – Appellant not banned as on date of submitting bid or even date of award of contract – Only show cause notice as to why it should not be blacklisted for another tender was issued – Conditions not requiring disclosure of show cause notice – Blacklisting prospective – Blacklisting after award of tender would have no application to the tender awarded. (Para 21, 28)

       (b) Government contract – Undertaking by bidder – As to the information furnished in the bid and attachments being true to the best of the knowledge and belief of the bidder – There being no blacklisting on relevant date, held, undertaking given by appellant not false – Further, integrity pact not relevant to fourth part of clause 20(i). (Para 22, 23)

       (c) Government contract – Show cause notice for blacklisting – May result either way – Bidder may or may not be blacklisted – Debarring a bidder only on basis of show cause notice cannot be sustained – More so when the notice asking to show cause why action for blacklisting be not initiated, and not blacklisting itself (Para 24, 25)

       (d) Constitution of India – Article 226 – Business Continuity Certificate – Respondent 3 casting serious doubts on Business Continuity Certificate submitted by appellant – Such factual disputes cannot be gone into in writ jurisdiction but in a suit proceeding – Writ Court does not sit in appeal over administrative decisions. (Para 31, 32)

       (2019) 2 SCC 329 – Relied upon

       (e) Administration of justice – Interpretation of judgment – Interim order dated 7.1.2019 of Supreme Court observing that respondent 1 may take a decision – Interdict was on implementation of such decision if taken – Respondent 1 merely issuing notice and choosing not to proceed further but awaiting decision in present appeal – No infirmity – Held, High Court ought not issued the direction, as it sought to do. (Para 33, 34)

       (f) Constitution of India – Article 226 – Government and Instrumentalities of State entering economic activities – Need for scrutinizing fairness in procedure – Permitted to be raised in writ jurisdiction – Approach of challenging every small or big tender under Article 226 as a matter of routine – Not desirable – Courts expected to exercise restraint in interfering with the administrative decision – View of the author of document in interpreting it must prevail – Courts should not give their own interpretation to contracts, more specifically tender terms, at the behest of a third party competing for the tender, rather than what is propounded by the party framing the tender. (Para 36, 38, 42)

       (2016) 16 SCC 818; (2018) 11 SCC 508; (2013) 8 SCC 131 – Relied upon

       (2009) 1 WLR 1988 (PC) – Referred

       Facts of the case:

       Hindustan Petroleum Corporation Limited (respondent No. 1) floated an e-public tender on 4.12.2017 for setting up call centres for receiving, recording and replying to information enquiries and complaints from LPG customers of IOC/HPC/BPC. The appellant participated in the tender.

       Respondent No. 1 evaluated the technical and financial bids and declared the appellant as L-1 and respondent No. 3 as L-2 on 16.1.2018. The letter of acceptance of the tender awarded to the appellant was issued on 12.2.2018 for a value of Rs.791 lakh basic for services to be rendered for a period of two years.

       Respondent No. 3 filed a writ petition in the Bombay High Court on 17.2.2018, assailing the declaration of the appellant as L-1. The purchase order in favour of the appellant confirming the terms of contract and mode of payment was issued on 21.2.2018. One day later, on 22.2.2018, the Ministry of Agriculture and Farmers Welfare passed an order blacklisting and debarring the appellant from participating in any tender process of the Government of India, Ministry of Agriculture and Farmers’ Welfare for two years with effect from the date of issue of the order. This order was assailed by the appellant by filing a writ petition before the Delhi High Court, which dismissed it and a Letters Patent Appeal filed against the same is pending.

       Respondent No. 3, having become aware of the factum of blacklisting of the appellant amended the petition to incorporate the said fact. The writ petition was allowed by a Division Bench dated 21.12.2018.

       Finding of the Court:

       It cannot be said that the appellant would be disentitled to the contract.

       Result: Appeal allowed.