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2023 Supreme(Del) 5879

IN THE HIGH COURT OF DELHI AT NEW DELHI
Subramonium Prasad, J.
M/s Kamac - Shiva (Jv) - Appellant
Versus
National Highways And Infrastructure Development Corporation Ltd. - Respondent
W.P.(C) 10845 of 2023 & CM Appls. 42036-37 of 2023
Decided On : 26-09-2023

Advocates appeared:
Ms. Mani Gupta, Mr. Pranav Malhotra and Ms. Vishakha Saluja, Advocates, for the Petitioner.
Ms. Ruchira Gupta, Mr. Deep Narayan Sarkar and Ms. Sonal Rawat, Advocates, for the Respondent.

IMPORTANT POINT
Misrepresentation of facts at the time of bidding amounted to fraudulent practice, justifying the debarment of the joint venture consortium.

Headnote:

Fraudulent Practice - Debarment of Joint Venture Consortium - The court discussed the clauses of the RFP relevant to technical capacity and experience, and the fraudulent practice clause. The court found that misrepresentation of facts by a member of the joint venture at the time of bidding amounted to fraudulent practice, justifying the debarment of the joint venture consortium.

Fact of the Case:

The Petitioner challenged the decision of the Respondent/NHIDCL debarring the Petitioner, a joint venture consortium, for misrepresentation of facts at the time of bidding for a highway project in Assam.

Finding of the Court:

The court found that the misrepresentation of facts by a member of the joint venture at the time of bidding amounted to fraudulent practice, justifying the debarment of the joint venture consortium.

Issues: The main issue was whether the decision of the Respondent to debar the joint venture consortium on the ground of misrepresentation of facts made by a member of the consortium at the time of bidding was sustainable or not.

Ratio Decidendi: The court held that the decision to debar the consortium on the ground of misrepresentation of facts made by a member of the consortium at the time of bidding was sustainable under the RFP clauses.

Final Decision: The writ petition challenging the debarment of the joint venture consortium was dismissed by the court.

JUDGMENT

1. The Petitioner has approached this Court challenging the decision of the Respondent/National Highways and Infrastructure Development Corporation Ltd. (NHIDCL) debarring the Petitioner being joint venture consortium consisting of M/s Kamac Engineers Pvt. Ltd. (KEPL) and M/s Shiv Harlalka, for a period of one year from participating in any tender or Request for Proposal (RFP) issued by the Respondent/NHIDCL.

2. The Respondent/NHIDCL brought out a Request for Proposal (RFP) and a Notice Inviting Tender (NIT) bearing No. Bid/Pkg No: NHIDCL/Assam/JD/Re/2022/2019136 dated 27.04.2022 inviting bids for "Four Laning of Jhanji to Demow from Km. 491.050 to Km. 535.250 of NH-37 in the state of Assam under SARDP on Engineering Procurement and Construction (EPC) Mode" (hereinafter referred to as 'Project') at an estimated cost of Rs.271.12 crores. The said project was to be completed within a period of 18 months with a defeat liability period of 60 months. The Petitioner is a joint venture created between M/s KAMAC and M/s Shiv Harlalka by way of a joint Bidding Agreement for the purpose of placing the bid for the aforesaid project. M/s KAMAC was to be the lead member of the joint venture. M/s Shiv Harlalka gave Power of Attorney to the Petitioner for the purpose of entering into the contract with the Respondent and signing other documents. The Petitioner placed its bid and also submitted a sum of Rs.2,71,00,000/- as bid security.

3. The relevant clauses of the RPF i.e., Clauses 2.2.2.2, 2.2.2.4, 2.2.2.5 and 2.2.2.6 which are necessary for the adjudication of the present case read as under:

    2.2.2.2 Technical Capacity

    (i) For demonstrating technical capacity and experience (the "Technical Capacity"), the Bidder shall, over the past [5 (five)] financial years preceding the Bid Due Date, have received payments for construction of Eligible Project(s) or has undertaken construction works by itself in a PPP project, such that the sum total thereof, as further adjusted in accordance with clause 2.2.2.5 & (ii), is more than (the "Threshold Technical Capacity") given in the Data Sheet.

    (ii) For normal Highway projects (including Major Bridges/ROB/Flyovers/Tunnels):

    Provided that at least one similar work of 20% of Estimated Project Cost shall have been completed from the Eligible Projects in Category I and/or Category 3 specified in Clause 2.2.2.5. For this purpose, a project shall be considered to be completed, if more than 90% of the value of work has been completed and such completed value of work is equal to or more than 20% of the estimated project cost. If any Major Bridge/ROB/Flyover/Tunnel is (are) part of the project, then the sole Bidder or in case the Bidder being a Joint Venture, any member of Joint Venture shall necessarily demonstrate additional experience in construction of Bridge/ROBs/Flyovers/Tunnel in the last 10 (Ten) years preceding the Bid Due Date (works completed as on bid due date shall also be considered for this clause) i.e. shall have completed atleast one similar Bridge/ROB/Flyover having span equal to or greater than:

    (a) In case, longest span of bridge/ROB/flyover is less than or equal to 60m, no additional qualification is required.

    (b) When longest span is more than 60 m: 50% of the longest span or 100 m, whichever is less, of the structure proposed in this project.

    And in case of tunnel, if any, shall have completed construction of atleast one tunnel construction of single or twin tubes (including tunnel(s) for roads/railway/metro/rail/irrigation/hydro-electric projects etc.) having atleast:

    (a) In case tunnel is a part of project having length less than or equal to 200 m, then no additional qualification is required.

    (b) When length of tunnel more than 200 m: 50% of the cross sectional area of proposed tunnel or two lane highway tunnel cross-section area, whichever is less and 20% length of the tunnel to constructed in this project or 2 km, whichever is less.

    (iii) For Stand-alone specialized projects:

    (a) Major Bridg

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