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IN THE HIGH COURT OF DELHI
Sanjeev Sachdeva, J.
Lord Krishna Electronic Industries - Appellant
Versus
New Delhi Municipal Council - Respondent
W.P.(C) 7512 of 2019 & CM Appl. 31299 of 2019
Decided On : 20-12-2021




Submitting a non-compliant bid does not justify debarment; such action requires substantial evidence of wrongdoing as per the Pre Contract Integrity Pact.

Headnote:(A) Pre Contract Integrity Pact - Debarment provisions - No cogent evidence to support the debarment of the petitioner under the Pre Contract Integrity Pact; merely submitting a non-compliant bid does not warrant debarment. (Paras 23, 24, 25)

(B) Administrative Law - Standards of evidence to justify debarment - the powers to debar must correlate strictly to the breach of specific provisions outlaid in the Pre Contract Integrity Pact. (Paras 28, 29)

Facts of the case:
Petitioner was debarred for three years based on alleged submission of false documents in tendering, but claimed the documents were compliant when submitted late. A vigilance report indicated discrepancies in three supporting orders but failed to substantiate any claims of forgery.

Findings of Court:
The debarment order lacked sufficient evidence and was assumed rather than demonstrated; thus, it was quashed.

Issues: Whether the petitioner was rightly debarred based on not submitting compliant documents and the sufficiency of the evidence for such an order.

Ratio Decidendi: The court held that debarment requires substantial evidence of wrongdoing; mere non-compliance in submissions should only lead to bid rejection, not debarment.

Result: Petition allowed.

Table of Content
1. debarment of the firm under scrutiny (Para 1 , 8)
2. arguments regarding eligibility and debarment (Para 2 , 3 , 4 , 5)
3. details of the tender and bid submission (Para 6 , 10 , 12)
4. court analysis of administrative finding and evidence (Para 13 , 14 , 15 , 16)
5. discussion on the validity of purchase orders (Para 17 , 18 , 19 , 20 , 21 , 22)
6. legal standards for debarment versus bid rejection (Para 23 , 24 , 25 , 33)
7. pre contract integrity pact stipulations (Para 26 , 27 , 28 , 29 , 30)
8. clarifications on compliance and processes (Para 31 , 32 , 34)
9. ruling against the debarment (Para 35)
10. formal conclusion and order of the court (Para 36 , 37 , 38)

JUDGMENT

Sanjeev Sachdeva, J. (Oral)--Petitioner impugns order dated 09.07.2019 whereby the petitioner firm has been debarred from further tendering in NDMC for a period of three years with immediate effect.

2. Learned counsel for the petitioner submits that the petitioner had furnished certain documents to show fulfilment of the eligibility criterion, however, later it transpired that erroneously petitioner had furnished the documents which did not show him eligible and after the bid submission date a further document was submitted which showed the bid of petitioner as compliant, however, as the document was submitted late, petitioner's bid was rejected.

3. Learned counsel submits that a show cause notice was issued on 05.04.2019 which was duly replied to. He further submits that error was committed by the officers of the petitioner in submitting documents which did not show petitioner eligible, however, none of the documents were forged or fabricated which could have entailed the punishment of debarment. He submits that when this was pointed out instead of withdrawing the show cause notice petitioner has been debarred for a period of three years.

4. Learned counsel appearing for the respondent submits that a vigilance enquiry was conducted into the documents submitted and the enquiry report showed that the documents were false and accordingly the action of debarment has been taken.

5. Further it is contended that petitioner has the remedy of approaching the Independent External Monitors and as such the petition is not maintainable.

6. Respondents had issued an E-procurement tender notice. The eligibility criterion for qualification in the said tender was that the tenderer should have successfully executed three similar supply orders, each of value not less than 40% of the estimated cost put to tender or two similar supply orders of value not less than 60% of the estimated cost or one similar supply order of value not less than 80% of the estimated cost put to tender, during the-last seven years and should submit scanned copies in support of their claim, through e-tendering system.

7. Petitioner had submitted copies of three supply orders along with the bid document. However, the three orders had not been successfully executed. It is the case of the petitioner that when this error was noticed one more supply order was provided which was more than 80% of the estimated cost of the tender which would have shown the petitioner as duly qualified.

8. Petitioner does not impugn the rejection of the bid but is only aggrieved by the debarment of the petitioner for a period of three years.

9. The show cause notice dated 05.04.2019 enlists the grounds for proposed action as under:

    "Whereas NDMC team has also enquired about the aforementioned purchase orders and as per there visit at the address of M/s Electra Fusion Technologies, 70, Sukh Vihar, New Delhi-110051, the team met Smt. Krishna Sabharwal, W/o Late. Sh. Joginder Sabharwal, an Ex NDMC Employee, who; informed that she is not aware of the existence and trade of above the said company. The team cited that M/s Electra Fusion Technologies, may be a fictitious company as per version of Smt. Krishna Sabharwal and so supply order dated 07/07/2013 seems false.

    The NDMC team also visited the M/s Vivek

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