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IN THE HIGH COURT OF DELHI AT NEW DELHI
Subramonium Prasad, J.
Lava International Limited – Appellant
Versus
Union of India & Anr. – Respondents
W.P.(C) 9206 of 2023 & CM APPL. 35006 of 2023 with W.P.(C) 9207 of 2023 & CM APPL. 35008 of 2023
Decided On : 16-08-2023
GeM - Suspension of GeM Account - Incident Management Policy, Clause 3.4 - The court discussed the Incident Management Policy of the Government E-Marketplace, specifically Clause 3.4, which categorizes 'false statements' as 'grave offences' and provides for suspension of the account for up to 60 days for the first and second deviation. The court highlighted the severity of the offense and the rationale for the decision to suspend the petitioner's account.
Fact of the Case:
The petitioner, a mobile handset manufacturer, mistakenly selected 'iOS' instead of 'Android' as the operating system for its products on the GeM portal. This led to the suspension of the petitioner's GeM account for 60 days. The petitioner contended that the error was a human typographical mistake and should be classified as a 'mild deviation' under the Incident Management Policy.
Finding of the Court:
The court found that the deviation had serious implications, including misleading buyers and causing wastage of procurement time and resources for the buyer organization. The court also noted that the petitioner failed to rectify the error despite multiple communications seeking the same. The court concluded that the decision to suspend the petitioner's account was justified under the Incident Management Policy.
Issues: The main issue was whether the court should set aside the decision to categorize the incident as 'grave' and suspend the petitioner's account for 60 days.
Ratio Decidendi: The court held that it would not interfere with the decision unless it was marred by perversity or illegality. It emphasized that the decision-making process and the decision itself were within the discretion of the deciding authority, and the court's interference was limited to instances of mala fides, unreasonableness, or arbitrariness.
Final Decision: The court dismissed the writ petitions and declined to entertain them, upholding the decision to suspend the petitioner's GeM account.
JUDGMENT
1. The present Writ Petitions have been filed under Article 226 seeking the issue of an appropriate writ for quashing and setting aside the order dated 08.06.2023 issued by the GeM Admin, Government E-Marketplace, Sansad Marg, New Delhi-110001, suspending the GeM Account of the petitioner for a period of 60 days from 08.06.2023 to 07.08.2023, in terms of Incident Report Numbers 1617676 & 1617676, which were issued by the GeM Admin to the Petitioner herein for submission of fake documents or false statements.
2. The facts leading up to the passage of the impugned order and the petitioner's objection to it thereof are as follows:
a. The petitioner, Lava International Limited with registered office at B-14, House-2, Basement, Shivlok Commercial Complex, Delhi 110015, limited is a private limited company engaged in the business of manufacturing Mobile Handsets in India.
b. The respondent No. 1, Government E-market place (GeM), under Ministry of Commerce and Industry, 2nd Floor, Jeevan Tara Building, Sansad Marg, New Delhi 110001 was established via official gazette notification dated 08.12.2017 with the aim of facilitating online procurement of Goods and Services required by various Government Departments, Organisations and PSUs using tools such as e-bidding, reverse e-auction and demand aggregation. The Respondent No. 1 platform operates via initial registration and creation of self-filled Product Catalogues by manufacturers and retailers of various goods and services as `sellers' on the GeM portal, thereby allowing them to display their products on the portal, based on which the government entities float procurement tenders for their desired goods and services, inviting bids from the registered GeM sellers, followed by subsequent scrutiny and documentation before actual purchase. The Respondent No. 2, GeM Admin, is the concerned in-charge of Respondent No. 1.
c. It is stated that the petitioner on 13.03.2023 & on 19.04.2023 created product catalogues for Mobile Headsets, namely, Yuva 2 Pro and Lava Blaze Pro respectively, on the GeM Portal. The petitioner correctly filled up the `product description' column of the catalogues with `Android 12 OS' as the products Operating Software, however, due to inadvertent typographical human error, the petitioner at the drop-down menu of the `operating system' column of the catalogues form clicked the option `iOS 10 or higher'.
d. Respondent No. 1 as on 29.05.2023 received a complaint from a seller on the GeM Platform informing that the product catalogue of one of the petitioner pertaining to Lava Blaze Pro (LZX404) as presented by two resellers of the product, Estore Enterprises and Metex Engineers, bore the same abovementioned erroneous technical specifications, that is, the catalogue has operating software as iOS despite selling phones based on Android Operating Systems and that the resellers had gone ahead to participate in a bid on the portal bearing number GEM/2023/B/3212631 dated 09.03.2023 with the abovementioned error in the product catalogues. It had also been brough to the respondents attention that in view of the said bid award, a letter had already been issued to the buyer organization dated 02.05.2023, by the resellersEstore Enterprises and Metex Engineers, admitting to the deviation and clarifying it as a typographical error.
e. The product Admin of Respondent No. 1 thereby, on 01.06.2023, marked a deviation on the petitioner's products and an automatic message was uploaded on the `incident' section of the Dashboard of the petitioner's GeM account, affording 48 hours to upload relevant documents and state the facts to defend the deviation highlighted. Subsequently, on 05.06.2023 and 06.06.2023, two incident messages were again uploaded on the `incident' section of the petitioner's GeM account directing the petitioners to upload relevant documents and/or state relevant facts defending the deviation within a time period of 24 hours.
f. It is stated that due to no response fr
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