IMPORTANT POINT
Government Contract – In tender matters, court exercising judicial review does not sit in appeal over decision of a tendering authority regarding disqualification of bid – Terms of NIT must be clear and unambiguous.

JUDGMENT

Joymalya Bagchi, J.

1. Leave granted.

2. Appellant is aggrieved by the judgment and order dated 07.09.2021 whereby the Division Bench of the Allahabad High Court, Lucknow Bench refused to set aside the decision of 1st respondent-Krishi Utpadan Mandi Parishad [Hereinafter referred to as “1st respondent-Mandi Parishad”] rejecting appellant’s technical bid on the ground that the ‘haisiyat praman patra’ submitted by it had not been issued by District Magistrate.

3. Dispute arose from a tender floated by 1st respondent-Mandi Parishad to let out a banquet hall/terrace lawn for 10 years to the highest bidder. The notice inviting tender [Hereinafter referred to as “NIT”] prescribed a two-stage bidding process comprising a technical bid and a financial bid. The technical bids were to be evaluated first and only bidders meeting the eligibility criteria would qualify for the second stage, where the financial bids were to be evaluated and tender awarded to the highest bidder. One of the conditions, namely Clause 18 in the NIT stated that bidder must submit a ‘haisiyat praman patra’ of minimum Rs.10 crores with the technical bid.

4. Appellant as well as 5th respondent (successful bidder) submitted their respective bids. Appellant’s technical bid was disqualified for the reason that the ‘haisiyat praman patra’ was issued by a private architect and not a District Magistrate. Claiming itself to be the highest bidder and that technical bid had been unlawfully rejected, appellant approached High Court by way of a writ petition.

5. High Court dismissed the writ petition holding that valuation certificate submitted by appellant having been issued by a private architect could not be treated as a ‘haisiyat praman patra’, i.e., solvency certificate which is always issued by the office of District Magistrate.

6. Appellant challenged the decision before this Court by way of Special Leave Petition. This Court on 17.12.2021 while issuing notice, directed as follows:-

“ In case the successful tenderer has not started the execution of the tender, no further work be done in pursuance to the tender and in case it has so started, it would be subject to the final orders to be passed by this Court ”

7. We have heard learned counsel for parties and perused the records.

8. The issue which falls for consideration is whether appellant, while submitting a valuation certificate issued by a professional architect cum private valuer attached to the Income Tax Department, had complied with Clause 18 of NIT which required it to submit a ‘haisiyat praman patra’ of minimum Rs.10 crores.

9. Appellant has strenuously argued that nothing in the NIT necessitated that ‘haisiyat praman patra’ be issued by a District Magistrate. It contended ‘haisiyat praman patra’ submitted by the appellant was by an experienced valuer who was empanelled with the Income Tax Department and there was no justification to reject such certificate. It was also argued that the valuation certificate assessed the value of the asset at around Rs.99 crores, of which appellant was 76.09 % shareholder, whereas as per clause 18 the bidder was to furnish a ‘haisiyat praman patra’ of minimum Rs.10 crores only.

10. In rebuttal, the 1st respondent-Mandi Parishad referred to Uttar Pradesh government notification dated 29.10.2018³ [Notification No. C.M.-648/One-9-2018-7(M)/18, hereinafter referred to as “government notification”] laying down the procedure for issuance of ‘haisiyat praman patra’ by District Magistrate. It was contended that Clause 18 required submission of such ‘haisiyat praman patra’ and not valuation certificate issued by a private valuer. All bidders apart from appellant had submitted ‘haisiyat praman patra’ issued by District Magistrate. It was also contended that valuation certificate does not disclose appellant’s net worth as it fails to indicate whether the asset so valued was free from encumbrances.

11. In tender matters, the court exercising judicial review does not sit in appeal over the dec