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IN THE HIGH COURT OF DELHI
Vipin Sanghi, Jasmeet Singh, JJ.
VRG Energy India Pvt. Ltd.-Avni Traders (Consortium) - Appellant
Versus
Union of India - Respondent
W.P.(C) 5750 of 2021 & CM Appls. 18034-18035 of 2021
Decided On : 14-09-2021




A Joint Venture bidder may combine the average annual turnover of its members to meet tender qualification criteria, and ambiguous tender terms cannot result in disqualification.

Headnote:(A) Administrative Law - Tendering Process - Criteria for qualification - The court held that a Joint Venture bidder is entitled to combine the average annual turnover of its members for meeting the eligibility criteria. The wording in the tender documents must be interpreted in a manner that does not render any part redundant. (Paras 17-24)

(B) Judicial Review - Disqualification of Bids - The rejection of a technical bid based on insufficient turnover must strictly adhere to the established criteria and cannot lead to arbitrary disqualification. (Paras 20-25)

Facts of the case:
The petitioner, a solar energy company, was disqualified from a tender process initiated by a government body due to insufficient average annual turnover, based on an ambiguous interpretation of the qualification requirements.

Findings of Court:
The court found that the petitioner should be allowed to combine the turnover of both joint venture partners to meet the required threshold for qualification and quashed the communication disqualifying the petitioner.

Issues: The key issues revolved around whether the petitioner could combine the turnover of its constituent companies for eligibility and if the rejection based on the interpretation of the qualification criteria was valid.

Ratio Decidendi: The court concluded that the language of the tender documents must be respected, emphasizing that ambiguous terms should not lead to the disqualification of a bidder if adherence to the criteria permits otherwise.

Result: Writ Petition allowed.

Table of Content
1. facts and procedural background of the case. (Para 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9)
2. respondent's reasons for disqualification. (Para 11 , 12)
3. clarification on qualifying requirements. (Para 13 , 14 , 15 , 17)
4. judicial interpretation of contractual language. (Para 18 , 19 , 20)
5. principles of contra proferentem and joint venture ato consideration. (Para 21 , 22 , 24 , 25)
6. court's decision to quash disqualification. (Para 26)
7. conclusion and outcome of the case. (Para 27)

JUDGMENT

Jasmeet Singh, J. The writ petition has been filed seeking the following substantive prayer:

    a. "Quash and set aside the impugned communication dated 20.05.2021 issued by the Respondent No.2 insofar it fails to include the Petitioner in the `Envelop Name: Price Bid;

    b. Quash and set aside the impugned e-mail communication dated 21.05.2021 issued by Respondent No.2 to the Petitioner.

    c. ...

    d. Stay further process with respect to Open Tender NIT/Bid Doc. No. EESL/06/2020-21/KUSUM/WPS/1-10 HP/Off Grid/202101032 dated 14.01.2021 issued by the Respondent No.2;

    e. Direct the Respondent to provide reason(s) for rejection of Technical Qualification bid of the Petitioner;

    f. Pass any such other order/directions as this Hon'ble Court deems fit and proper in the facts and circumstances of the case;

2. The Petitioner is stated to be one of India's leading solar company with a vision to harness and connect the power of Sun. The Petitioner was established in the year 2011 and is indulged in manufacturing, supplying and exporting the solar systems to both corporate and residential clients.

3. The respondent No. 2 is Energy Efficiency Services Limited (EESL) and is a Super Energy Service Company (ESCO), which enables consumers, industries and governments to effectively manage their energy needs through energy efficient technologies. EESL was founded in 2009, promoted by Ministry of Power, Government of India as a Joint Venture of four reputed public-sector undertakings namely a) NTPC Limited, b) Power Finance Corporation Limited, c) REC Limited and d) POWERGRID Corporation of India Limited.

4. On 14.01.2021, respondent No. 2 invited Detailed Invitation for Bids (IFB) for design, manufacture, supply transport, installation, testing and commissioning of Off Grid Solar Photovoltaic Water Pumping Systems of 1-10 HP in Selected States on PAN India basis, including complete system warranty and its repair and maintenance for 5 Years under MNRE KUSUM scheme Component-B.

5. Respondent invited e-bids from eligible bidders for the aforesaid work under Single-stage Three-envelope bidding process through E-tendering.

6. Pursuant to the IFB dated 14.01.2021, petitioner submitted its bid with the relevant documents vide the E-tendering process, as per the format prescribed by the respondent. The Respondent issued the Envelope receipt on 18.02.2021 and duly acknowledged the documents.

7. On 03.03.2021, the Technical Qualification bids were opened by Respondent No.2 and the petitioner's bid was rejected, insofar the petitioner was not included in the `Envelope Name: Price Bid'. Vide communication dated 20.05.2021, the petitioner got to know that his technical bid had been rejected.

8. Aggrieved by the said communication, the petitioner on the same date i.e. 20.05.2021 addressed a communication to Respondent No. 2 requesting Respondent No.2 to inform the reasons for Petitioner's disqualification. Subsequent to the said communication, respondent No.2 on 21.05.2021 vide an auto-generated response, informed the petitioner that the petitioner's bid was found to be non-responsive upon technical evaluation.

9. The Petitioner on 21.05.2021 addressed another communication seeking the basis of which petitioner's bids was declared nonresponsive. Since no reply was received, the petitioner has filed the aforesaid writ petition.

10. When the matter came up before this Court on 02.06.2021, this Court directed the respondent to disclose the reasons for ho















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