IN THE HIGH COURT OF DELHI AT NEW DELHI
Satish Chandra Sharma, Subramonium Prasad, JJ.
Loadstar Equipment Ltd. – Appellant
Versus
Container Corporation of India Ltd. – Respondent
W.P.(C) 5040 of 2023 & CM APPL. 19721 of 2023
Decided On : 04-07-2023
Tender Disqualification - Qualification Criteria - [Section II, Clause 2.1(b)] - [Summary of Acts and Sections]
Fact of the Case:
The Petitioner company filed a Writ Petition challenging the disqualification from a tender process due to discrepancies in submitted documents. The Petitioner sought to quash the communication declaring them as technically disqualified and requested to be treated as technically qualified in the tender.
Finding of the Court:
The Court found that the Petitioner fulfilled the eligibility criteria and their bid should not have been rejected. The Court directed the Respondents to proceed ahead in accordance with the law.
Issues: Discrepancies in submitted documents, arbitrary disqualification, and lack of reasons for disqualification.
Ratio Decidendi: The manufacturer had to show successful supply and installation of a similar item to meet the qualification criteria. The rejection of the certificate issued in favor of the supplier was not justified. The State must act validly for a discernible reason and not whimsically in matters of tender.
Final Decision: The writ petition was allowed, and the Respondents were directed to proceed ahead in accordance with the law.
JUDGMENT
1. The Petitioner company has filed the instant Writ Petition, for issuance of appropriate writ or directions to quash the communication dated 18.04.2023 issued by the Respondent No. 1 (Container Corporation India Ltd./CONCOR), declaring the Petitioner as technically disqualified from participating in the tender bearing reference no. CON/AREA1/TECH/FORKLIFT-20/2023, which was floated by Respondent No. 1 on their website vide NIT dated 08.02.2023.
2. The facts leading up to the present petition are that Respondent No.1 vide NIT bearing reference no. CON/AREA-1/TECH/FORKLIFT-20/2023, invited applications on the government portal, for bids from Original Equipment Manufacturers (OEMs)/authorized dealers, through a two packet online open tendering system, at an estimated total cost of Rs. 38,11,40,000/-, for the design, manufacture, supply, and commissioning of 20 forklifts of capacity 35 tons at specified terminals of Respondent No. 1/CONCOR.
3. Respondent No.1/CONCOR subsequently issued a corrigendum in respect of the part of the NIT document which lays down qualification criterion for bidders. Accordingly, Clause 2.1(b) under Section II "General Instructions to Bidders" was added to the NIT document. The relevant portion of the NIT document prescribing qualification criterion is as follows:
"2.0 Qualification Criteria
The bidder shall provide satisfactory evidence acceptable to the Purchaser to show that-
2.1 The bidder is a manufacturer or an authorized dealer of a manufacturer (as per Annexure 15) having experience of:
a) Having successfully supplied I executed at least one single purchase order of Government departments/CPSEs/SPSEs/Public listed companies/ICD/DCT /MMLP /Ports/CFS/ CTOs for similar item during previous three financial years and current financial year last day of month previous to the one in which tender is invited. The said item should have been supplied and commissioned successfully during the period mentioned above. Work experience certificate issued by private individual shall not be considered. Work experience certificate as per format attached at Annexure-14 should be submitted. The work experience certificate should have been issued within 90 days prior to tender opening date. If an authorized dealer submits bid on behalf of the manufacturer, the same dealer shall not submit a bid on behalf of another manufacturer in the same tender for the same item/product. Either Manufacturer OR their authorised dealer can quote. But both cannot bid simultaneously for the same item/product in the same tender.
b) The Tenderer must have received total contractual payments/ turnover/revenue (income) from operations of Rs.57.17 Crore in the previous three financial years (i.e., FY2019-20, FY2020-21 ft 2021-22) and the current Financial Year last day of month previous to the one in which tender is invited.
The tenderers shall submit Certificates to this effect which may be an attested Certificate from the concerned department I client or Audited Balance Sheet duly certified by the Chartered Accountant/Certificate from Chartered Accountant duly supported by Audited Balance Sheet. For current Financial Year certificate with regard to received total contractual payment/turnover/revenue (income) from operation should be duly certified by the Chartered Accountant.
Note: Client certificate from other than Govt Organization should be duly supported by Form 16A/26AS generated through TRACES of Income Tax Department of India."
4. As per the NIT conditions, bids of participants were to be opened in two stages on 03.03.2023. The technical bids of the bidders was to be opened in the first stage, and the financial bids was to be opened only in the second stage, subject to evaluation of 1st stage technical bids. The Petitioner and Respondent No. 2, the only participating bidders, submitted their technical bids. Bids of both companies were opened by Respondent No.1 for evaluation in the technical stage.
5. Upon examination of th
The State must act validly for a discernible reason and not whimsically in matters of tender.
Compliance with tender document requirements, including transportation experience, is crucial and cannot be overlooked based solely on lower financial bid rates.
The court upheld the validity of tender disqualification based on non-compliance with specified documentation requirements, affirming the decision-making integrity of the evaluation committee.
Public authorities must ensure fairness and non-arbitrariness in tender processes, adhering to established eligibility criteria.
Government contract – Tender - The judicial review on State administrative activities is limited inasmuch as the Constitutional Courts do not sit on appeal as to whether the decision is good and soun....
Judicial review in tender matters is limited to assessing procedural fairness, not the merits of the tender conditions, which are determined by the tendering authority.
The court upheld the tendering authority's discretion in setting eligibility criteria, emphasizing limited judicial review focused on procedural fairness rather than the merits of the decision.
Judicial review of tendering decisions is limited to assessing legality, with courts refraining from substituting the tender authority's decisions unless in cases of illegality or manifest arbitrarin....
The court upheld the authority's discretion in evaluating tender bids, emphasizing the need for compliance with mandatory conditions and the absence of arbitrariness in disqualification decisions.
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