In procurement matters, minimum eligibility criteria set by State authorities must be reasonable and not arbitrary; courts should exercise restraint in judicial review of such criteria.

JUDGMENT :

VIBHU BAKHRU, C.J.

1. For the reasons stated in the application – I.A.No.2/2025, the same is allowed. The delay of 139 days in filing the appeal is condoned.

2. The appellant has filed the present intra-court appeal impugning an order dated 09.09.2024 passed by the learned Single Judge in Writ Petition No.12793/2024 (GM-TEN).

3. Respondent No.1 [writ petitioner] had filed the afore- mentioned writ petition, impugning the pre-qualification criteria for submitting bids in terms of the Tender Notification dated 15.03.2024 [hereafter the NIT] issued by the appellant. The respondent’s challenge was not only upheld, but the learned Single Judge also modified the pre-qualification criteria.

4. The appellant [Bengaluru Metropolitan Transport Corporation] which is inter alia engaged in providing public transport - had issued the NIT inviting bids for supply of air, oil and fuel filters [the products] required for the vehicles operated by it.

5. The tender conditions as per the NIT, inter alia, stipulated the following pre-qualification criteria:

"1. PRE-QUALIFICATION CRITERIA:

Original Equipment Manufacturers

OR

Suppliers to Original Equipment Manufacturers OR ASRTU RC with OE status

"If any firm is a supplier to Original Equipment Manufacturer/ Firms under RC with OE status for AIR/OIL/ FUEL Filters for TATA, Leyland or Eicher vehicles, their quoted rates will be considered in the respective category of AIR/ OIL/FUEL Filters Irrespective of OE status.

OR

IATF 16949:2016 (or Latest) certified Manufacturers with minimum average annual turnover of Rs.100 Crores for preceding three continuous years (i.e., 2020-21,2021-22 and 2022-23) are eligible to participate.

2. The tenderer should undertake to supply the ordered quantity as per the delivery schedule provided.

3. The tenderer must fulfill all the statutory requirements.

4. Tenderers who have been blacklisted by any of the Government Organization/public supplies undertaking for breach of contract shall not be considered.

5. If the supply and quality performance are not satisfactory in respect of previous supplies, the offer of such firm will be disqualified.

6. Only the Original Equipment Manufacturer or Suppliers to Original Equipment Manufacturers or ASRTU Rate Contract holders with OE STATUS or Manufacturers has to participate in the tender using their own digital signature key. The bid will be rejected, if the Principal Original Equipment Manufacturer or Suppliers to Original Equipment Manufacturers or ASRTU Rate Contract holders with OE STATUS or Manufacturers authorizes someone else to participate/quote the rates on behalf of them.

7. Any bidder from a country which shares a land border with India will be eligible to bid in the tender only if the bidder is registered with the Competent Authority (as detailed at Annexure-B2). In this regard, a compliance certificate/ declaration to be submitted by the bidder on Rs. 20/- & above stamp Paper as per the format at Declaration-III (regarding restrictions on public procurements from bidders of such country/ countries which shares a Land Border with India.)"

6. Respondent No.1 [Luman Industries Limited] which is engaged in the business of manufacturing fuel filters, had filed the aforesaid writ petition aggrieved by the pre-qualification criteria, in as much as, it restricts the participation to only those entities, which had achieved the minimum average annual turnover of Rs.100 crores in the preceding three years [2020-21 to 2022-23]. Since respondent No.1's turnover was less than the said minimum threshold, it was excluded from furnishing its bid pursuant to the tender notification.

7. Respondent No.1 claims that the stip