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2011 Supreme(Del) 207
IN THE HIGH COURT OF DELHI AT NEW DELHI
HON’BLE MR JUSTICE SANJAY KISHAN KAUL HON'BLE MR JUSTICE RAJIV SHAKDHER
M/S ANSALDO CALDAIE BOILERS INDIA PVT. LTD. –PETITIONER
Vs
UNION OF INDIA & ANOTHER –RESPONDENTS
WP(C) No. 296/2011
Decided on : 01.03.2011
For the Petitioner:Mr.Harish Salve and Mr.Maninder Singh, Sr.Advocates with Mr.Rajiv Bansal, Mr.Prashant Kumar and Mr.Anurag Sharma, Advocates.
For the respondents:Mr.B.V.Niren, Advocate for R-1/UOI Mr.A.S.Chandhiok, ASG with Ms.Bindu Saxena and Mr.Shailendra Swarup, Ms.Aparajita Swarup and Ms.Neha Khattar, Advocates for R-2/NTPC
The interpretation of the QRs for a QSGM under the relevant clause of the bidding documents, and the determination of whether the petitioner met those QRs.
Headnote:
TENDER - QUALIFICATION REQUIREMENTS (QRS) - INTERPRETATION - STEAM GENERATOR PACKAGE - BIDDER'S ELIGIBILITY - SCOPE OF WORK - EVAPORATOR - MANUFACTURE - SUPPLY - JOINT VENTURE - DISQUALIFICATION - MALA FIDES - ALLEGATIONS - ANTECEDENCE - LEGAL OPINION - REJECTION OF BID - JUDICIAL REVIEW.
Fact of the Case:
NTPC invited global bids for Steam Generators for its various projects. The writ petitioner, an Indian joint venture company, filed its bid with NTPC. NTPC evaluated the bids and found that the petitioner did not meet the minimum QRs set forth in the bidding documents. The petitioner's bid was rejected on the ground that it did not have the experience of designing, engineering, and manufacturing an evaporator, which was a crucial part of the Steam Generator. The petitioner challenged the rejection of its bid, alleging mala fides and seeking a declaration that it met the QRs and was eligible to participate in the tendering process.
Finding of the Court:
The court held that the petitioner was eligible to participate in the tendering process as a Qualified Steam Generator Manufacturer (QSGM) under the relevant clause of the bidding documents. The court interpreted the clause to mean that a bidder would not be disqualified from being categorized as a QSGM only because the evaporator provided in the referential plant was supplied by a third party. The court found that the petitioner had the requisite experience in designing, engineering, and manufacturing a Steam Generator of the specified type, and that the fact that the evaporator was supplied by a third party did not disqualify it from being considered a QSGM. The court also found that the allegations of mala fides and ante-dating of the rejection letter were not substantiated by the evidence.
Issues: 1. Whether the petitioner met the QRs for a QSGM under the relevant clause of the bidding documents? 2. Whether the petitioner was eligible to participate in the tendering process? 3. Whether the rejection of the petitioner's bid was mala fide? 4. Whether the rejection letter was ante-dated?
Ratio Decidendi: 1. The court interpreted the relevant clause of the bidding documents to mean that a bidder would not be disqualified from being categorized as a QSGM only because the evaporator provided in the referential plant was supplied by a third party. 2. The court held that the petitioner had the requisite experience in designing, engineering, and manufacturing a Steam Generator of the specified type, and that the fact that the evaporator was supplied by a third party did not disqualify it from being considered a QSGM. 3. The court found that the allegations of mala fides and ante-dating of the rejection letter were not substantiated by the evidence.
Final Decision: The court allowed the writ petition, quashed the rejection letter, and directed NTPC to allow the petitioner to proceed to the next stage of the tendering process and participate in the technical discussions.
RAJIV SHAKDHER, J
1. The writ petitioner has approached this court under Article 226 of the Constitution of India to remedy its grievance qua respondent No.2 i.e., NTPC Ltd. (hereinafter referred to as NTPC). The grievance of the petitioner in short is its exclusion from the tendering process initiated by NTPC. The writ petitioner amongst others had tendered its bid in response to a tender floated by NTPC. By virtue of the said tender, NTPC sought bids with respect to Steam Generators package (in short ‘steam generators’). NTPC by virtue of the said tender sought offers in respect of 11 units of steam generators of 660 MW in respect of its projects at Mouda, STTP, Stage-II, Solapur STP, Nabinagar STPP, Meja TPP and Raghunathpur TPP Phase-II. Insofar as Nabinagar STTP and Meja TPP were concerned, these were projects which NTPC had routed through a joint venture, while Raghunathpur TPP Phase-II is a project of Damodar Valley Corporation Ltd.
2. The tender was issued on 23.06.2010. The bid documents in terms of tender were put on sale between 28.06.2010 to 30.07.2010. As is normally the case in such like tenders, sealed bids were invited by NTPC in two stages. At Stage-I, techno-commercial bids are received while at Stage-II price bids are to be received. In terms of the said tender, techno-commercial bids were to be received on 25.08.2010 uptil 1030 hours (IST), which in turn, were to be opened on the same day at 1100 hours (IST). As regards dates in respect of the next stage in the tendering process (i.e., submission of the price bid and its opening), these were to be intimated in due course.
3. The writ petitioner here has been eliminated from the tendering process at Stage-I (i.e., at the stage of opening of techno-commercial bid) on the ground that its bid did not meet the Qualification Requirements (in short, ‘QRs’) stipulated in the tender.
4. At this stage, we may only notice that even though pleadings and documents filed run into several hundred pages, the issue involved falls in a narrow compass. The writ petitioner’s techno-commercial bid has been rejected by NTPC on account of its ostensible failure to comply with the provisions of Clause 7.1.1 of section I of the tender. Evidently, this decision was conveyed by the NTPC to the writ petitioner vide its letter dated 05.01.2011. The writ petitioner has alleged mala fides in the issuance of the said letter. The allegations, in sum and substance being: that the said letter has been ante-dated. This allegation rests on the date of dispatch of the said letter which, according to the writ petitioner was 10.01.2011; a date which in point of fact falls after the date of issuance of notice by the writ petitioner to NTPC i.e., 07.01.2011. The writ petitioner has sought to further strengthen its aforesaid claim, by taking the stand that the said letter, in actuality, was received by it on 13.01.2011. We would come back to this aspect of the matter a little later.
5. The fact of the matter remains that by virtue of the aforementioned letter i.e., letter dated 05.01.2011, the writ petitioner’s techno-commercial bid was rejected on the ground that it did not meet the minimum requirement set forth in Item 4 of Section III of the tender documents. The necessary consequences of this was that the bank guarantee submitted by the writ petitioner towards bid security, was also returned.
6. Therefore, in order to appreciate the issue at hand we would be referring to only the relevant provisions of the tender documents (which otherwise contains multiple sections and provisions). In particular our emphasis would be on those provisions of the tender documents that pertain to QRs for the bidders. 6.1 It is important to note at this stage that it is a common case of the contestants before us, that the provision which calls for interpretation is clause 7.1.1. mentioned in Section I which is identical to clause 1.1.1 of item no.4 contained in section III of the tender documents. The commo
