The judgment establishes the principle that the decision-making process of public authorities in evaluating tenders should be free from arbitrariness and mala fides. It emphasizes the limited scope of judicial review in tender matters and the importance of compliance with tender conditions.

S. RAVINDRA BHAT, J.

Facts

1. The present Writ Petitioner challenges the declaration of its bid as non-responsive by Bharat Sanchar Nigam Limited (hereafter “BSNL” or “Respondent No. 3”) in these proceedings, under Article 226 of the Constitution of India.

2. The facts are that BSNL on 08.04.2016 issued a Notice Inviting e-Tender (“NIT”) calling for sealed online bids (tenders) for survey, planning, supply, installation, testing, commissioning, integration with existing core network and operations and maintenance for five years of 2G GSM BSS network along with VSAT, HUB and radio backhaul to provide coverage in uncovered villages of Arunachal Pradesh and Karbi Anglong and Dima Haso Districts of Assam. The eligibility criteria for participation was laid down in the NIT and the entire tender document could be obtained on payment of Rs.10,000.

3. The petitioner, an Indian Company, is engaged inter alia in the business of manufacturing, sale and supply of 2G BSS compliant equipment along with other allied products. The petitioner paid the requisite amount of Rs.10,000 and obtained the complete set of tender documents. Clause 11 of Section 4B of the said Tender stipulated that the bidder should clearly specify ownership, IPRs and certain other rights with respect to Technology/Designs of GSM BSS and if such technology/design was not developed by the bidder, the bidder was required to submit MOU Agreement with the technology provider as per the pro-forma in Section 7G and Board Resolution of the Technology Providing Company as per the pro-forma in Section 7H notarized or attested by the Indian Embassy/High Commission in the country where such foreign origin company is situated. The Petitioner wrote to BSNL seeking certain clarifications regarding this Clause, which among other queries, were answered by BSNL by letter, dated 25.07.2016.

4. In terms of the said Tender documents, the bidder had to submit its techno-commercial bid along with the documents regarding its complying with the eligibility- i.e. technical and commercial conditions, and a financial bid in two separate envelopes within 150 days from the tender opening date. The Petitioner submitted its bid on 10.08.2016 and also submitted a Bank Guarantee for Rs.2,00,00,000/- paid as security deposit. A Committee for Evaluating the Techno-Commercial bids (“CET”) was formed by BSNL to evaluate the bids and the Petitioner along with four others (namely M/s ITI, M/s VNL, M/s HFCL and M/s Fibcom) were invited to offer their equipments for field-testing in Arunachal Pradesh. Of the five, M/s Fibcom did not submit its equipment for the field test. The Petitioner received a test schedule for conducting the field test of its equipment, from BSNL, dated 27.08.2016. Accordingly, field tests were conducted for the Petitioner and three others, after which the equipments of two bidders- M/s VNL and M/s HFCL were considered to have qualified. The equipments of the other two, which included the Petitioner, were considered by BSNL to have failed the test.

5. Thereafter, a number of representations were made by the Petitioner and the other unsuccessful bidders regarding the method of field testing of the equipment as well as the subsequent evaluation of the bids. Considering these representations, BSNL at its meeting dated 16.01.2017 decided to give another opportunity to all the bidders to re-submit their tenders and furnish their equipment for re-testing, and decided that it would call for clarifications from the bidders who had submitted incomplete/not submitted required documents as per the terms and conditions of the tender documents. Thereafter, BSNL retested the equipment of the four bidders who offered their equipment for testing and concluded that all four had passed in the re-test conducted in Arunachal Pradesh. After retests were conducted, BSNL (through the CET) requested clarifications from all the bidders and re-evaluated their bids. The bids of M/s HFCL and M/s VNL were consid