Point of Law: Tender - Bidding Process - In all cases after technical bid has been accepted, bidder cannot be disqualified, except after opening of his commercial bid.

JUDGMENT :

S.C. GUPTE, J.

1. Heard learned Counsel for the Petitioner and learned Counsel for Respondent No. 1- ONGC and Respondent Nos. 4 and 5, who are the rival contractors, who have been awarded the subject contract pursuant to a bidding process, which is the subject matter of challenge in the present petition at the instance of the Petitioner.

2. The Petitioner claims to be a sole proprietor of a firm carrying on business of fresh water supply through barges. The Petitioner has been one of the contractors supplying water to Respondent No. 1 ONGC. On 26 November 2020, Respondent No. 1 invited Indigenous Open Tender for eprocurement for supply of water to its offshore facilities, including the Nhava Supply Base. The tender was a two bid system - a technical bid followed by a commercial bid. The Petitioner was one of the contractors, who submitted a bid. There were three others, who had also submitted bids. These others included Respondent Nos. 4 and 5, who have been successful bidders, whilst the third bidder was one Royal Traders, which happens to be a sole proprietorship of the Petitioner’s father. Whilst the Respondent ONGC had cleared the technical bids of all four bidders, including the Petitioner and his father, at the stage of consideration of commercial bids, the bids of both the Petitioner and his father were not opened. That was on the footing that upon evaluation of offers submitted by the Petitioner and M/s. Royal Traders, it had come to the notice of Respondent ONGC that the proprietors of the two firms were, respectively, the son and father. Considering that the two would have access to vital information pertaining to the bid submitted by the other, including the prices quoted by each other, the employer came to a conclusion that both bidders have an undisclosed understanding (formal or informal) with each other, which would restrict competitiveness or introduce cartilisation in the bidding process, thereby offending Section 2 of the Integrity Pact.

3. Section 2 of the Integrity Pact is quoted below:

Section 2 - Commitments of the Bidder/contractor

2. The Bidder/Contractor will not enter with other Bidders into any undisclosed agreement or understanding, whether formal or informal. This applies in particular to prices, specifications, certifications, subsidiary contracts, submission or non - submission of bids or any other actions to restrict competitiveness or to introduce cartelisation in the bidding process.

4. It is the Petitioner’s case that whilst it is correct that the Petitioner and the proprietor of Royal Traders are a son and father duo, that circumstance by itself does not imply any undisclosed agreement or understanding between the two, whether formal or informal, or amount to any action so as to restrict competitiveness or introduce cartilisation in the bidding process.

5. After this matter was heard earlier by this Court, this Court, by its order dated 29 April 2021, permitted the Petitioner to file a representation with the competent authority of Respondent ONGC and the latter was directed to pass a reasoned order on that representation. Pursuant to this order, the Petitioner did file a detailed representation to the competent authority of ONGC, who, by its detailed order dated 5 May 2021, rejected the representation on a composite statement of reasons. In the meantime, it appears that the subject contract was awarded to Respondent Nos. 4 and 5, who were successful bidders, upon opening of commercial bids; the award was notified on 12 February 2021 and, pursuant to the award, formal contracts were executed on 8 March 2021 and 22 March 2021, respectively.

6. Learned Counsel for the Petitioner challenges the impugned award of contract to Respondent Nos. 4 and 5 by denying opportunity to the Petitioner, on the following grounds:

(a) It is, firstly, submitted that the Petitioner’s bid does not involve any breach of the Integrity Pact. It is submitted that there is no prohibition on relatives participating in