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2024 Supreme(Gau) 1520

IN THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
MICHAEL ZOTHANKHUMA, J.
Hemanta Bora, S/o Late Padma Kanta Bora – Appellant
Versus
Oil India Ltd. – Respondent
WP(C) 6625 of 2024
Decided on : 19-12-2024

Advocates:
Advocate Appeared:
For the Appellant :Mr. S. Banik …. Advocate.
For the respondents: Mr. A. Sharma …. SC, Oil.

IMPORTANT POINT
The court upheld the authority's discretion in setting tender eligibility criteria, emphasizing minimal judicial intervention unless clear arbitrariness is shown.

Headnote:

(A) Tendering Process - Accountability and Eligibility Criteria - The petitioner challenged the new tender conditions set by Oil India Limited, which required bidders to own a minimum of two bowsers. The court upheld the conditions, emphasizing the authority's discretion in defining eligibility criteria and the need for accountability in tender processes. (Paras 4, 10, 12)

(B) Judicial Intervention - The court reiterated that judicial intervention in contractual matters involving state instrumentalities should be minimal, deferring to the expertise of the authority that authored the tender documents unless there is clear evidence of arbitrariness or mala fides. (Paras 8, 14)

Facts of the case:

The petitioner, lacking the required number of bowsers, argued that the new tender conditions unfairly restricted participation and favored established players.

Findings of Court:

The court found no arbitrariness in the tender conditions and upheld the authority's right to set eligibility criteria.

Issues: The main issues were whether the tender conditions were discriminatory and if the petitioner had a right to demand changes to the eligibility criteria.

Ratio Decidendi: The court ruled that the authority's interpretation of its own tender conditions should be respected, and that the petitioner could gain experience through other means.

Result: Writ petition dismissed.

JUDGMENT :

1. Heard Mr. S. Banik, learned counsel for the petitioner and Mr. A. Sharma, learned Standing Counsel, Oil India Limited for all the respondents.

2. The petitioner’s case is that the Oil India Limited used to float tenders every three years, for transportation of crude oil etc, by using 12 KL capacity bowsers/tankers from various Oil’s field locations in Assam and Arunachal Pradesh.

3. The petitioner’s counsel submits that earlier a person, who did not have the required number of bowsers to be a bidder for transportation of the crude oil, could attach his bowser with the bid of a bidder, who had bowsers and also had the other eligibility criteria required for participating in the tenders issued by Oil India Limited. The person who attached his bowser with a bid of a bidder, could thereafter count his participation in the tender process as “experience”, for participating in the next bid to be made by Oil India Limited. However, by the new tender No.CDT7868P25, Oil India Limited has done away with the concept of a bowser owner attaching his bowser with the bid of an eligible bidder, thereby eliminating any chance for the said person having only a single bowser, to gain any experience for participating in any future Oil India Limited Tender, for transportation of crude oil etc.

4. The petitioner’s counsel submits that in terms of the new tender No.CDT7868P25, the bidder must have a minimum of 2/3 bowsers/tankers. He submits that the bowsers/tankers have to be in the name of the bidder and the bidder cannot attach the bowsers/tankers of any other person as a part of his bid. He submits that the doing away with the Clause allowing the attachment of a bowser of other persons to the bids of bidders by the Oil India Limited, restricts new players like the petitioner from participating in future tenders, as they would never be able to have the required “experience”, to participate in future tenders. He submits that the same also encourages the formation of a cartel to dominate the tender proceedings. He accordingly submits that a direction should be issued to the respondents, to cancel the tender and direct them to issue a fresh tender, allowing new players like the petitioner to attach their single bowser with the bid of the bidders, who can participate in the bidding process.

5. Mr. A. Sharma, learned Standing Counsel, Oil India Limited, on the other hand, submits that the Oil India Limited have done away with the process of the bidder attaching the bowsers of other persons, for the sake of accountability and to enable Oil India Limited to fix the responsibility in the case of any untoward incident that may happen to the bowser owned by somebody else, other than the bidder. He submits that events pertaining to accidents would also not require Oil India Limited to run after persons other than the actual bidder. He further submits that as per Clause 3.1 of the Terms and Conditions of the Tender, the bidder can always gain “experience”, by providing services for transportation under the Central Government/State Government/Public Sector Undertaking/Exploration and Production Company/Nationalized Banks/Public Limited Company for a continuous period of minimum two years under a single contract by deploying the minimum of 1 tanker/bowser, having a capacity of not less than 9 KLs each. He submits that no right vests with the petitioner, to gain “experience” only from the tenders issued by Oil India Limited. He accordingly submits that Oil India Limited is the best person to understand and appreciate it’s own requirement and that it must have the freedom to make a contract on it’s own terms. He accordingly submits that the interpretation of a tender document should be left solely to the author of the tender document, unless the same is arbitrary, unreasonable, mala-fide or biased. In the present case, he submits that none of the above is attracted and as such, the writ petition should be dismissed.

6. I have heard the learned counsels fo

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