IN THE HIGH COURT OF DELHI AT NEW DELHI
SATISH CHANDRA SHARMA, SUBRAMONIUM PRASAD, JJ.
In the Matter of:
Well Protect Manpower Services Pvt. Ltd. – Appellant
Versus
Lady Hardinge Medical College and Others - Respondents
W.P.(C) 11132 of 2022 and CM APPLs. 32673 of 2022, 32674 of 2022, 52385 of 2022, 52386 of 2022, 52387 of 2022, 52388 of 2022
Decided on : 13-04-2023
Tender - Award of Contract - GeM Portal - [FACT OF THE CASE] By way of the present Writ Petition, the Petitioner, Well Protect Manpower Services Pvt. Ltd., has impugned the letter dated 22.07.2022 (hereinafter referred to as the ‘Impugned Decision’) addressed by the Ministry of Health and Welfare, i.e., Respondent No. 2 herein, granting approval to Lady Hardinge Medical College, i.e., Respondent No. 1, to issue a Letter of Award in favour of Trig Detectives Pvt. Ltd., i.e., Respondent No. 3, with respect to the tender initiated by Respondent No. 1 vide Bid No. GEM/2021/B/1462748 dated 28.08.2021, inviting bids for provision of security services in its premises (hereinafter referred to as the, ‘Tender’). The factual matrix of the case, leading to the filing of the present Writ Petition are as under: [FINDING OF THE COURT] The court analyzed the criteria for selection of the successful bidder, the tie-breaking process, and the autonomy granted to the buyer to devise its own mechanism. The court found that the decision-making process was not arbitrary or irrational. [ISSUES] The main issue was the rationality of the award of the tender to Respondent No. 3. [RATIO DECIDENDI] The court held that the buyer has the autonomy to devise its own mechanism for selecting the successful bidder and interference by the court should be minimal. [FINAL DECISION] The petition was dismissed. [KEY LEGAL PRINCIPLE] The court emphasized that interference in a tender process should be minimal and warranted only in situations where the decision of the tendering authority is colored in malafide, or was intended to favor someone or is so outrightly perverse that a reasonable person could not have arrived at such decision. [CATEGORY] Administrative Law [SUB-CATEGORY] Tender Process
JUDGMENT :
1. By way of the present Writ Petition, the Petitioner, Well Protect Manpower Services Pvt. Ltd., has impugned the letter dated 22.07.2022 (hereinafter referred to as the ‘Impugned Decision’) addressed by the Ministry of Health and Welfare, i.e., Respondent No. 2 herein, granting approval to Lady Hardinge Medical College, i.e., Respondent No. 1, to issue a Letter of Award in favour of Trig Detectives Pvt. Ltd., i.e., Respondent No. 3, with respect to the tender initiated by Respondent No. 1 vide Bid No. GEM/2021/B/1462748 dated 28.08.2021, inviting bids for provision of security services in its premises (hereinafter referred to as the, ‘Tender’). Accordingly, the Petitioner has prayed before this Court that appropriate directions be issued for cancellation of the Impugned Decision and award of the Tender to the Petitioner.
2. The factual matrix of the case, leading to the filing of the present Writ Petition are as under:
ii. A committee created by Respondent No. 1 convened a meeting with to finalize the bid document of the Tender. The committee inter-alia decided the criteria as per which marks were to be allotted to prospective bidders to ascertain their merit for award of the contract.
iii. Respondent No. 1 on 28.08.2021 initiated the Tender vide Bid No. GEM/2021/B/1462748, inviting bids for provision of security services to Respondent No. 1 for a period of two years through GEM Portal. The Petitioner and Respondent No. 3.
iv. On 06.09.2021, the committee constituted by Respondent No. 1 for creation of the Tender documents convened another meeting. In the Minutes of Meeting issued by the committee, it inter alia communicated its decision in respect of a representation made by M/s. Good Year Security Services regarding the point system devised by Respondent No. 1. It was stated that the point system was created to select a successful bidder in case of multiple L-1 bidders and such criteria not being in contravention of the extant GEM guidelines, would only enable in selection of a better agency for which may meet workplace expectations. Accordingly, it refused to change such criteria.
v. On 06.09.2021, Respondent No. 1 wrote to Respondent No. 2 inter alia intimating that it had uploaded the Tender for outsourcing of security services for a period of two years and accordingly requested extension of the existing contract of security services up to 30.11.2021.
vi. On 09.11.2021, Respondent No. 1 wrote to Respondent No. 2 seeking extension of contract of existing vendor providing security services as its contract was nearing expiration. In terms of the said letter, Respondent No. 1 also informed Respondent No. 2 that the process of outsourcing of security services had been initiated through the GeM Portal.
vii. On 16.02.2022, after evaluating the bids submitted in respect of the Tender, Respondent No. 1 issued a list of technically qualified bidders which included Petitioner and Respondent No. 3, were both found technically qualified.
viii. On 28.04.2022, a committee created by Respondent No. 1 to evaluate the financial bids of the technically qualified bidders convened a meeting to undertake financial evaluation of the bids. Upon evaluation, it was found that M/s. MI2C Security and Facilities Pvt Ltd. and M/s. Trig Detectives Pvt. Ltd. were tied at 96 marks as per the criteria which had been devised by Respondent No. 1 and M/s. Trig Detectives having the highest turnover, was chosen as the successful bidder.
ix. On 09.05.2022, Respondent No. 1 wrote to Respondent No. 2 inter alia informing Respondent No. 2 that M/s. Trig Detectives Pvt. Ltd
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The tendering authority's decision should not be interfered with unless it is mala fide, arbitrary, or irrational.
Limited scope of judicial review in tender matters, deferring to the decision-making process of the tendering authority unless colored in mala fide or outrightly perverse.
The court affirmed that adherence to established tendering procedures is crucial, and deviations must be justified; otherwise, the authority's decisions should not be interfered with.
Judicial review in public procurement is limited; courts refrain from interference unless clear evidence of arbitrariness or bad faith is established.
The court established that significant deviations from tender guidelines and arbitrary evaluation criteria violate the principles of fairness and proportionality under Article 14 of the Constitution.
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