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THE HIGH COURT OF GAUHATI (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
DEVASHIS BARUAH, J
Mahalaxmi Enterprises - Appellant
Versus
The State Of Assam And 5 Ors - Respondent
WP(C) 3832 / 2024
Decided On : 04-02-2025
(A) General Financial Rules, 2017 - Rule 173 - Assam Public Procurement Act, 2017 - Section 3 and Section 23 - Tender process cancellation - The court examined the legality of the cancellation of a tender process initiated for procuring Ice Lined Refrigerators, finding that the modification of eligibility criteria from ISO-17025 to WHO-PQS Code was not properly communicated as required by law. The court ruled that the original criteria remained valid and the cancellation was arbitrary and unreasonable. (Paras 50 , 56 )
(B) Public Procurement - Fairness and Transparency - The court emphasized that any modification to tender conditions must be communicated properly to ensure fairness and transparency in the procurement process, and that arbitrary actions violate Article 14 of the Constitution. (Paras 52 , 58 )
Facts of the case:
The petitioner challenged the cancellation of a tender for Ice Lined Refrigerators after being declared the lowest bidder. The tender process was initiated under a government scheme, and modifications to the eligibility criteria were made without proper communication. (Paras 4 , 10 , 16 )
Findings of Court:
The court found that the original certification criteria remained valid and that the cancellation of the tender process was arbitrary and lacked justification. The court ordered the continuation of the original tender process. (Paras 50 , 58 )
Issues: The main issues included whether the modification of eligibility criteria was valid and whether the cancellation of the tender process was arbitrary. (Paras 37 , 56 )
Ratio Decidendi: The court held that modifications to tender conditions must be communicated in the same manner as the original tender was published, and failure to do so renders the cancellation of the tender process arbitrary and unreasonable. (Paras 50 , 52 )
Result: The cancellation of the tender process was set aside, and the authorities were directed to proceed with the original tender process. (Paras 58 )
JUDGMENT :
DEVASHIS BARUAH, J.
The decision to cancel the tender process and to go ahead with the fresh tender process is the subject matter of consideration before this Court in the present writ petition.
2. Heard Mr. D Das, the learned Senior Counsel assisted by Mr. B Gogoi, the learned counsel appearing on behalf of the petitioner and Ms. M.M. Kataky, the learned Standing Counsel appearing on behalf of the Animal Husbandry and Veterinary Department of the Government of Assam.
3. None has appeared on behalf of the private respondent Nos. 4, 5 and 6, although due notice was affected upon them.
4. The facts leading to the filing of the instant writ petition are narrated infra.
The Director of Animal Husbandry and Veterinary Department floated an e-Tender dated 13.02.2024 in the GeM portal for procuring 367 Nos. of Ice Lined Refrigerators (ILR). The said notice inviting tender stipulated that the last date for submission of the tender was on 05.03.2024 by 12 P.M. and the date and time for bid opening was on the same date at 12.30 P.M. It was also mentioned that the time allowed for technical clarification during the technical evaluation was 2(two) days and the evaluation method prescribed was very formal “Total Value-wise Evaluation”
5. Before further narrating on the aspect of the tender process, it would be relevant to take note of that the said tender process was initiated on a sponsored scheme of the Government of India, Ministry of Fisheries, Animal Husbandry and Dairying Department of Animal Husbandry and Dairying. This aspect of the matter is clear from the communication dated 28.03.2022 issued by the Joint Secretary of the Government of India, Ministry of Fisheries, Animal Husbandry and Dairying Department of Animal Husbandry and Dairying. In the said communication, it was categorically mentioned that a guidance document had been prepared for model infrastructure specifications so as to enable their procurement for optimal utilization within the budget sanctioned. It was also mentioned that eventually based on the requirement at various levels- districts, blocks, villages, States/UTs may strategize procurement and placement of these equipments. The advisory enclosed to the said communication as an Annexure specifically dealt with the Ice Lined Refrigerators (ILR) of the size and its description. The commercial terms were also mentioned in the said advisory. In terms with Clause 1.6 of the commercial terms, it was mentioned that the cold chain products may be tested at ISO-17025 accredited laboratories.
6. In the backdrop of the above, it is now relevant to take note of the tender conditions. To the said tender conditions, there is a Specific Additional Terms and Conditions wherein the technical specifications of the Ice Lined Refrigerators (ILR) have been duly mentioned. Further to that, the eligibility for participating in the bid/tender had also been mentioned in the Specific Additional Terms and Conditions. Amongst the various conditions for eligibility for participating in the bid/tender, it was mentioned that the cold chain products may be tested at ISO-17025 accredited laboratories which was in tune with the advisory issued by the Government of India, Ministry of Fisheries, Animal Husbandry and Dairying Department of Animal Husbandry and Dairying. This Court further finds it relevant to take note of the Check List which was a part of the Specific Additional Terms and Conditions. The Check List was both for Original Equipment Manufacturer (OEM) as well as for authorized dealers/agents/distributors etc. In Clause 6 of the Checklist for Original Equipment Manufacturer (OEM), the Product Tested Certificate at ISO-17025 approved laboratories / WHO PQS Code was mentioned. Similarly in the case for authorized dealers/agents/distributors etc. at Sl.No.7, the Product Tested Certificate at ISO-17025 approved laboratories /WHO PQS Code was mentioned.
7. Before further
Tender modifications must be communicated properly to ensure fairness; arbitrary cancellation violates constitutional rights.
The cancellation of a tender process before technical evaluation does not confer vested rights to bidders, and adherence to procurement laws is mandatory in future processes.
The authority may cancel a tender without reason if lack of competition is evident; bidders have no enforceable rights without formal acceptance of their bids.
The court emphasized the necessity for transparency in public procurement processes, ruling that arbitrary actions in tender decisions violate procedural fairness and statutory requirements.
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