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SUPREME COURT OF INDIA
PAMIDIGHANTAM SRI NARASIMHA, ALOK ARADHE, JJ.
M/s. Steag Energy Services (India) Pvt. Ltd. – Appellants
Versus
GSPC Pipavav Power Company Ltd. (GPPC) & Ors. – Respondents
Civil Appeal No(s). 3895-3896 of 2026 Arising out of SLP (C) No(s). 30209-30210 of 2025
Decided On : 25-03-2026
Key Points: - Tender evaluation processes must be respected and not interfered with unless there is clear evidence of arbitrary or irrational decision-making by the contracting authority [judgement_subject]. - Courts should exercise restraint in reviewing tender evaluations unless evidence of mala fides, arbitrariness, or irrationality is presented [judgement_subject]. - The final decision in tender evaluations lies with the owner, and courts should not pre-empt executive actions [judgement_subject]. - The Supreme Court upheld the appellant's bid and reinstated the Letter of Award (LOA), emphasizing the owner's discretion in decisions [Facts of the case]. - The court held that decisions regarding bid evaluations, especially involving technical criteria, are best left to the discretion of the owners unless extreme circumstances necessitate judicial intervention [Ratio Decidendi]. - The tender was based on a Quality and Cost Building System (QCBS) with a 70% weightage to technical evaluation and 30% to cost evaluation (!) . - The appellant initially scored higher in technical evaluation, and after a re-evaluation, a tie in technical scores occurred, but the appellant had a marginally higher financial score (!) (!) (!) . - The High Court quashed the LOA based solely on a marginal price difference, which the Supreme Court found to be an unjustified interference [Issues] (!) . - The Supreme Court emphasized that technical evaluation or comparison by the court is impermissible and that courts should allow "free play in the joints" for the owner (!) . - The Supreme Court noted that the owner (GPPC) has the right to accept any bid and reject any or all bids (!) . - The Civil Appeal was allowed, and the High Court's judgment was set aside [Result] (!) .
| Table of Content |
|---|
| 1. details of tender process and evaluation criteria. (Para 3 , 4 , 5) |
| 2. bidding process and scores of bidders. (Para 6 , 7 , 8 , 9 , 10) |
| 3. challenges against tender process. (Para 12) |
| 4. summary of consultant's evaluation report. (Para 14 , 15) |
| 5. high court's evaluation and decision rationale. (Para 16 , 17 , 18) |
| 6. principles of judicial review in tender disputes. (Para 19 , 20 , 21) |
| 7. judicial restraint in tendering processes. (Para 22 , 23 , 24 , 25) |
| 8. assessment of the high court's interference merits. (Para 26 , 27 , 28) |
| 9. affirmation of original award of contract. (Para 29 , 30 , 31) |
JUDGMENT :
1. Leave granted.
2. These appeals arise out of the judgment and order passed by the High Court of Gujarat at Ahmedabad in Special Civil Application No. 7289 of 2025 and Special Civil Application No. 12328 of 2025.
3. Facts leading to filing of these appeals lie in a narrow compass. The first respondent GSPC PIPVAV Power Company Limited, (hereinafter referred to as GPPC) commissioned in the year 2013-2014 a gas based combined cycle power plant of 702.86 MW. In January 2025, GPPC floated a public tender inviting bids for operation and maintenance of the combined cycle power plants for an initial period of 5 years.
4. The tender was based on Quality and Cost Building System (QCBS) in which weightage is given to quality as well as cost for the purpose of evaluation and grant of tender. Quality quotient would consider the technical strength/evaluation of the bidders wherein the financial capability of the bidder is taken into account as per the tender terms. The cost quotient considers the cost of the owner for hiring i.e. the financial bid submitted by the bidder. The weightage is 70% to the technical evaluation and 30% to the cost evaluation. The terms of the tender relating to evaluation of bids and award of contract is contained in clause 20.2 of the tender document.
5. It is necessary to reproduce clause 20 to the extent that it is relevant for our consideration:
20.1 The Contract will be awarded to the competitive responsive Bidder, with most optimized evaluated price, for five years, offering the technically acceptable Bid in conformity with the requirements of this enquiry specification. A responsive Bid is one which accepts all terms and conditions of these specifications and documents without any modifications. A modification is one which affects in any way the prices, quality, quantity of the Works or which limits in any way the responsibilities or liabilities of the Bidder or any rights of the Owner as required in these specifications. The decision of Owner is final in this regard.
20.2. i) Evaluation of offer/ proposal shall be done on Quality and Cost Based System (QCBS) wherein the Technical Score i.e. Marks Given During Unpriced Technical Bid Evaluation will be allotted weightage of 70 % and the price proposal will be allotted weightage of 30% as Mentioned below:
A combined "Score (S)" will be arrived at after considering weightages 30% for price bid and 70% for technical scores, according to the following methodology.
S= (St X Tw) + (Sf X Fw)
Where S = Total Score
St = combined technical score (Total marks scored as per evaluation methodology)
Sf = Combined financial score = 100 x Fm/F
Fm = Lowest Cost
F = Price Bid of the bidder of whom Sf is to be calculated
Tw = Weight assigned to technical score i.e. 70% or 0.70
Fw = Weight assigned to financial score i.e. 30% or 0.30
The successful bidder will be the one who has highest score (S).
ii) Evaluation Technical scores (St): (Allocation of marks against each parameter shall be as per the marks defined for each parameter and Pro-Rata calculation wherever mentioned in the table given below.
| S.No. | Parameter | Maximum Marks allotted | Documents to be attached as an evidence to substantiate the claim |
| B | Technical Experience of the bidder | ||
| 3 | Experience of planning and su | ||
Tender evaluation processes must be respected and not interfered with unless there is clear evidence of arbitrary or irrational decision-making by the contracting authority.
Judicial review in tender matters requires restraint, emphasizing compliance with the tendering authority’s interpretation unless clear evidence of wrongfulness is established.
Clause 7.1 of RFP reads as under: Information relating to evaluation of proposals and recommendations concerning contract award shall not be disclosed to consultants who submitted proposals or to oth....
The decision of the employer in interpreting the conditions of eligibility in a tender document must be respected unless it is shown to be arbitrary, outrageous, and highly unreasonable.
Judicial review in public procurement is limited; courts refrain from interference unless clear evidence of arbitrariness or bad faith is established.
The experience of sister concerns cannot be considered in tender evaluations, reinforcing the necessity of adhering strictly to bid criteria to prevent arbitrary actions by State entities.
Bidders must provide complete and accurate documentation as required by tender specifications, and courts should exercise restraint in reviewing decisions made by tender authorities unless there is c....
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