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2023 Supreme(Del) 2802

IN THE HIGH COURT OF DELHI AT NEW DELHI
Satish Chandra Sharma, Subramonium Prasad, JJ.
M/s J Kumar Infraprojects Limited – Appellant
Versus
National High Speed Rail Corporation (Nhsrcl) – Respondent
W.P.(C) 32 of 2023 & CM APPL. 71 of 2023
Decided On : 15-02-2023

Advocates appeared:
Mr. Parag P. Tripathi, Senior Advocate with Mr. Somesh Chandra Jha, Ms. Misha Rohatgi and Mr. Devansh Srivastava, Advocates, for the Petitioner.
Mr. R. Venkataramani, Attorney General with Mr. Rajshekhar Rao, Senior Advocate with Ms. Richa Kapoor, Mr. Kunal Anand, Mr. Sandesh Kumar, Ms. Tusharika Sharma, Mr. Jai Batra, Mr. Prakhar Dixit, Mr. Amresh Bind and Ms. Vishakha Gupta, Advocates, for the Respondent.

The main legal point established in the judgment is the interpretation and application of Clause 28.1 and Clause 42.5 of the Instructions to Bidders in the context of bid rejection and the rights of unsuccessful bidders to seek explanations.

Headnote:

Bid Rejection - International Competitive Bidding - Clause 28.1, Clause 42.5 - The judgment discusses the rejection of the petitioner's bid in an international competitive bidding process. It refers to Clause 28.1 and Clause 42.5 of the Instructions to Bidders, which state that information relating to the evaluation of bids and recommendation of contract award shall not be disclosed to bidders until information on contract award is communicated to all bidders, and after notification of award, unsuccessful bidders may request a debriefing seeking explanations on the grounds on which their bids were not selected. The court's decision is influenced by the interpretation of these clauses and their application to the petitioner's bid rejection.

Fact of the Case:

The petitioner seeks to quash the communication cancelling their bid and claims for consideration of their bid documents. The respondent cancelled the bid due to a missing formal sentence in the Bank Guarantee.

Finding of the Court:

The court found that the Writ Petition is pre-mature as per Clause 28.1 and Clause 42.5 of the Instructions to Bidders. The court dismissed the Writ Petition, stating that the petitioner can seek explanations on the grounds for bid rejection as per Clause 42.5.

Issues: The issues include the validity of bid rejection based on a missing formal sentence in the Bank Guarantee and the pre-maturity of the Writ Petition as per the Instructions to Bidders.

Ratio Decidendi: The court's decision is based on the interpretation and application of Clause 28.1 and Clause 42.5 of the Instructions to Bidders, which govern the disclosure of bid evaluation information and the rights of unsuccessful bidders to seek explanations for bid rejection.

Final Decision: The Writ Petition is dismissed, and the petitioner is advised to seek explanations on the grounds for bid rejection as per Clause 42.5 of the Instructions to Bidders.

JUDGMENT

1. Vide the instant Writ Petition, the Petitioner herein seeks to quash the communication dated 27.12.2022 issued by the Respondent herein by which the Respondent had cancelled the Petitioner's bid in the last stage of the bid evaluation process. The Petitioner also claims for an appropriate writ/direction/order directing the Respondent herein to consider the Bid Documents submitted by the Petitioner.

2. On 21.07.2022, Respondent herein issued invitation for bids for International Competitive Bidding for the Work of Design and Construction of Civil and Buildings Works, including Testing and Commissioning on Design-Build Lump Sum Price basis for Double Line High Speed Railway for Mumbai Underground Station Cut & Cover Tunnel and Shaft-1 from MAHSR Km -- 0.255 to Km. 0.775 at Bandra-Kurla Complex in the State of Maharashtra for the Construction of Mumbai-Ahmedabad High Speed Rail Package No.MAHSR-C-1.

3. It is stated that as per the tender document, the Petitioner herein executed a Non-Disclosure Obligation Agreement (hereinafter referred to as `the NDA') and uploaded the same on the e-procurement portal of NIC on 26.07.2022. It is stated that the Respondent herein, after considering the NDA submitted by the Petitioner herein allowed the Petitioner to make a payment of Rs.2,36,000/- towards cost of Bidding Document. It is stated that a pre-bid meeting was conducted by the Respondent herein on 22.08.2022 and the Petitioner herein submitted its Bid Document on 03.11.2022 along with the Bid Security.

4. It is pertinent to mention here that the entire bid evaluation was to be completed in 5 stages, with Technical Evaluation being at Stage No.4 and Financial Evaluation being at Stage No.5.

5. It is stated that the Petitioner herein realized that the Bid Document submitted by the Petitioner was not being considered by the Respondent as the Petitioner was neither receiving any queries nor any information from the Respondent herein. It is stated that on checking the copy of the Bank Guarantee for Bid Security issued by its Banker, i.e., Indian Bank, the Petitioner realised that a formal sentence in the end of the Bank Guarantee has been missing in the said Bank Guarantee. The said sentence reads as under:

    "This guarantee is subject to the Uniform Rules for Demand Guarantees (URDG) 2010 Revision, ICC Publication No. 758"

6. It is stated that the Petitioner herein approached the Bank pointing out the missing line and a fresh bank guarantee was submitted by the Petitioner on 22.12.2022. It is stated that on 28.12.2022, the price bids of other bidders were opened and the bid of the Petitioner herein, which, according to the Petitioner, may be substantially lower, was not considered by the Respondent herein.

7. The Petitioner has, therefore, approached this Court by filing the instant Writ Petition stating that the reason for rejecting the bid was only a missing formal sentence in the Bank Guarantee that could not be a valid ground for rejection of the bid.

8. The matter came up for hearing on 06.09.2022 and this Court directed the Respondent herein to file a detailed reply in the matter.

9. Reply has been filed. In the reply, Respondent herein has raised a preliminary objection on the maintainability of the instant Writ Petition. The Respondent has relied on Clause 28.1 and 42.5 of the Instructions to Bidders and has stated that the instant Writ Petition is pre-mature. It is contended by the Respondent that as per Clauses 28.1 and 42.5 of the Instructions to Bidders, any challenge by the Petitioner to the disqualification of its technical bid by the Respondent is maintainable only after the tender is finalized. It is stated that the present case relates to a Foreign Sovereign Funded Mega Project i.e. Mumbai-Ahmedabad High Speed Rail, popularly known as the Bullet Train Project. It is stated that for the project, a Memorandum of Understanding was entered into between the Japanese and Indian Governments and it was agreed that

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