IN THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
MITALI THAKURIA, J.
Shri Gichik Tami (Proprietor of M/s G.T. Enterprises), S/o-Late Gichik Takkar – Appellant
Versus
The State of Arunachal Pradesh – Respondent
WP(C) 53(AP) of 2024
Decided on : 01-10-2024
Constitution of India - Article 226 - Writ of Certiorari or Mandamus - Tender process - Petitioner, a civil firm, challenged the issuance of a Letter of Intent (LOI) to another bidder, alleging violation of tender conditions and lack of transparency - The petitioner was disqualified due to non-furnishing of a Tax Clearance Certificate, a mandatory requirement - The court found no grounds to interfere as the petitioner did not challenge the rejection of his technical bid and had no locus standi to contest the LOI - The court emphasized that the owner of a project is best suited to interpret tender documents and that unsuccessful bidders cannot challenge the award of contracts to successful bidders. (Paras 1-50)
Facts of the case:
The petitioner participated in a tender process for MGNREGA works but was disqualified for not providing a Tax Clearance Certificate. The LOI was issued to another bidder despite the petitioner being ranked as L1 by the Tender Evaluation Board.
Findings of Court:
The court found that the petitioner was disqualified due to a lack of necessary documentation and that the tender process was conducted transparently.
Issues: The main issues were the legality of the LOI issued to the private respondent and the petitioner's standing to challenge it.
Ratio Decidendi: The court ruled that the petitioner, being an unsuccessful bidder, could not challenge the LOI as he failed to qualify in the technical bid.
Result: Writ petition dismissed.
JUDGMENT :
Heard Mr. T. Taba, learned counsel for the petitioner. Also heard Ms. P. Pangu, learned Government Advocate for the respondent No.1; Mr. B. Picha, learned counsel for the respondent Nos. 2 to 7 and Mr. D. Mazumdar, learned Senior Counsel assisted by Mr. T. Garam, learned counsel for the respondent No.8.
2. This application is filed under Article 226 of the Constitution of India, seeking the issuance of a writ in the nature of Certiorari or Mandamus, or any other appropriate writ, order, or direction.
3. The brief facts of the case is that; the petitioner is the proprietor of a firm, namely M/S G.T. Enterprises, having its registered office at Dokum Colony, P.O. & P.S. Itanagar, Dist. Papum Pare, Arunachal Pradesh. It is categorized as a civil firm enlisted under the provisions of the Arunachal Pradesh Enlistment of Contractors in Works Department Rules, 2008, to engage in the business of supply and construction. Respondent No. 5 issued a notice inviting tender dated 11.08.2023 for the supply and procurement of materials pertaining to MGNREGA works 2023-24 for CD Block Sarli under Kurung Kumey District. The estimated cost for the work, as stated in the NIT, was Rs. 20,241,845.00 (Rupees two crore two lakhs forty-one thousand eight hundred forty-five) only.
4. Accordingly, the petitioner participated in the aforementioned tender process by submitting his bid. Four firms submitted their respective bids for the tender: M/S G.T. Enterprises (petitioner), M/S Pacho Enterprise, M/S P. Mero Enterprises, and M/S N.K. Enterprise (the private respondent herein). According to the NIT, the date for opening the tender papers, including both technical and financial bids, was fixed for 05.09.2023, and the time for completion of work was set from 01.08.2023 to 31.03.2024. However, the respondent authority took considerable time to evaluate the bids submitted. Due to the delay in finalizing the tender, the petitioner developed reasonable doubts regarding potential foul play in the tendering process. Consequently, he filed an RTI application through a friend on 12.01.2024 before respondent No. 4, seeking information regarding the finalization of the tender process and details about the submissions of tender documents by all participating firms.
5. Respondent No. 4 forwarded the request to the Assistant Project Officer (Technical), Nodal Officer, MGNREGA, to furnish the requested information. The petitioner received the information vide letter dated 24.01.2024 issued by the APIO for the Project Director, DRDA, Kurung Kumey. After reviewing the information, the petitioner learned that the Tender Evaluation Board had opened the technical bids of all the tenderers. Subsequently, respondent No. 5 prepared a comparative statement dated 30.10.2023, which indicated that the tender amount quoted by the petitioner was the lowest bidder, ranking him as L1. The M/S Pacho Enterprise was ranked as L2, M/S P. Mero Enterprises as L3, and M/S N.K. Enterprises as L4.
6. Moreover, the bid amount quoted by the private respondent No.8, i.e. the M/S N.K. Enterprise, exceeded 10%, which violates Clause 8 of Sub-Clause XIII of the NIT's terms and conditions. The bid amount quoted by the private respondent was (-) 12.00003%, which is unacceptable under any circumstances as per the NIT's terms and conditions. During the Board Proceeding Meeting held by the Tender Evaluation Committee on 30.11.2023, it was determined that only the bid submitted by the petitioner was correct, as the other three bidders failed to submit Section 6 Form along with their financial bids, a mandatory requirement. After considering all bids, the board recommended the petitioner as L1 (lowest bidder) and M/S Pacho Enterprise as L2.
7. It is stated that respondent No. 5 subsequently wrote a letter (No. DRDA/KKD/MGNREGA/NIT-02/2021-22) dated 30.11.2023 to respondent No. 2 for approval and finalization of tenders concerning five CD Blocks, including the present tender in question. However, respon
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An unsuccessful bidder lacks standing to challenge the issuance of a Letter of Intent when disqualified for failing to meet mandatory requirements.
An unsuccessful bidder cannot challenge the award of a tender if disqualified in the technical evaluation, as they lack standing to do so.
The court emphasized that the award of contracts should be in public interest and not interfered with unless there is evidence of malafide or irrationality.
Judicial intervention in tender processes is limited to cases of clear procedural violations or arbitrariness, emphasizing the importance of transparency and adherence to established norms.
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.
Tender authorities must adhere to statutory criteria and act transparently; courts will not interfere unless clear evidence of arbitrariness or malafide conduct is presented.
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