IN THE HIGH COURT OF JUDICATURE AT BOMBAY NAGPUR BENCH
ANIL S. KILOR, RAJNISH R. VYAS, JJ.
SMS Limited – Appellant
Versus
The Western Coalfields Limited – Respondent
Writ Petition No. 2115 of 2025
Decided On : 07-10-2025
| Table of Content |
|---|
| 1. tender process and price quoting rules. (Para 1 , 3 , 11) |
| 2. arguments regarding gst inclusion. (Para 4 , 5 , 6 , 7 , 8 , 9) |
| 3. interpretation of tender documents. (Para 10 , 15 , 16) |
| 4. judicial review standards for tender decisions. (Para 19 , 20) |
| 5. decision to allow the petition. (Para 21) |
JUDGMENT :
RAJNISH R. VYAS, J.
1. Heard.
2. Rule. Rule made returnable forthwith. Heard finally by consent of the parties.
3. Heard Mr. M.G. Bhangde, learned Senior Advocate a/b Mr. Adarsh Baheti, Advocate for the petitioners and Mr. Anand Jaiswal, learned Senior Advocate a/b Mr. Nachiket Moharir, Advocate for respondents. Matter was closed for orders on 8th of September 2025. On 16th September 2025, petitioner filed written note on the pursis by the respondents, pointing out certain decisions of Honourable Apex Court. According to Mr Bhangde, learned Senior Counsel for the applicant, the terms and conditions of the tender documents are crystal clear which shows that the tender was excluding GST. He has invited our attention to various terms and conditions and argued the matter at length. It is contended by the petitioner that in response to the notice inviting tender, in all 5 bidders submitted their bids including him and after technical evaluation, price bid was opened. He was declared as L-1 and accordingly, vide letter dated 25.3.2025, he requested respondent No. 2 to issue letter of acceptance. On 28-3-2025, discussion of representative of petitioner with respondent No. 2’s officer took place in which respondent took a stand that tender conditions require the bidder to quote price including GST. The petitioner accordingly, addressed a letter and email dated 01-04-2025 to respondent No. 2 and requested that if there is any dispute, same be referred to independent external monitors for adjudication. On 04-04-2025, reply was given to the petitioner in which it was stated by the respondent No. 2 that in view of clarification received from GeM, the petitioner has been declared as L-1 bidder on its quoted price which is inclusive of GST. On the same date, respondent No. 2 issued letter of acceptance in favour of the petitioner by treating price quoted as inclusive of GST and petitioner was further called upon to furnish performance security within 21 days of letter of acceptance. Again, on the same date, Area General Manager, Kanhan Area, WCL, called upon petitioner No.1 to deposit performance security in the form of bank guarantee. This prompted petitioner to again address communication on 07-04-2025 to independent external monitor with a request to intervene in the matter, but in vain. On 10-04-2025, the petitioner received a letter from Area General Manager, Kanhan Area, WCL calling upon petitioner No.1 to submit bank guarantee. He thus, submits that the action on the part of respondent is arbitrary.
4. Per contra, Mr. Anand Jaiswal, learned Senior Advocate a/b Mr. Nachiket Moharir, for respondents argued that petition cannot be entertained by this Court considering the fact that there is valid agreement between the parties and recourse can be taken to the arbitration proceedings. He further stated that dispute with respect to interpretation of terms and conditions of the contract between the parties will not be permissible in the writ jurisdiction.
5. He argued that as per tender document, it was made amply clear that the bidders were required to quote rates and amount at two different places, firstly in exel format as enclosed with the NIT (Notice Inviting Tender) as per clause 1.8(G) of buyer added ATC and secondly, in GeM portal as per clause 6 of GeM General Terms and Conditions. As per said clauses, it would be clear that bidders was to quote rates in exel format “excluding GST, while submitting BOQ. However, the rate to be quoted in the GeM portal was to be inclusive of GST. This is clear from the GeM portal itself and as stated in clause 8 of GeM General Terms and conditions. According to him, the petitioner entered sa
AI
The court ruled that tender documents clearly required prices quoted to exclude Goods and Services Tax (GST), affirming that ambiguity in contractual terms did not exist.
Point of law : Since the terms “except goods and service tax” was specified in Clause 3.3.3 of Ext.P1, the petitioner could only have quoted the bid amount, without including the GST.
A contractor cannot claim GST over and above the quoted rate when the contract explicitly states that the rate is inclusive of GST.
Judicial review in tender matters requires restraint, emphasizing compliance with the tendering authority’s interpretation unless clear evidence of wrongfulness is established.
The rejection of the lowest bid based on unjustified TDS deductions violates tender conditions and principles of fairness under Article 14.
The main legal principle established is the authority of the Tendering Authority to waive non-essential tender conditions and the requirement for rational decision-making in such matters.
A contractor is entitled to GST payments on completed works, as tender rates must be exclusive of GST per government circulars.
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