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2023 Supreme(Gau) 1551

THE GAUHATI HIGH COURT, (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
Sandeep Mehta, C.J., Arun Dev Choudhury, J.
Sibaram Deka, S/o. Lt. Sishuram Deka - Petitioner 
Versus
The State Of Assam, Rep. By The Commissioner And Secretary To The Govt. Of Assam, Panchayat And Rural Development Deptt., And Ors. – Respondents
WA No.395 of 2022
Decided On : 31-05-2023

Advocates Appeared:
For the Petitioner: Mr F. K. R. Ahmed
For the Respondent: SC, P. And R.D.

A bidder who participates in a tender process without objection is precluded from challenging the validity or fairness of the tender conditions after being found unsuccessful.

Headnote:(A) Constitution of India - Article 14 - Assam Panchayat Financial Rules, 2002 - Rule 47(10) - Tender Process - Challenge to tender clause - Highest bidder allowed to submit documents post-selection - Validity of clause - A tenderer who participates in a tender process without objection and is subsequently found to be unsuccessful is precluded from challenging the process or contending that the process was unfair by virtue of a clause in the notice inviting tender. (Para 10)

(B) Writ Jurisdiction - Maintainability - Where the issues raised by a petitioner, even if answered in their favor, would have no practical effect on the petitioner's outcome due to their ranking in the bidding process, the court may decline to examine the merits of the challenge. (Para 11)

Facts of the case:
A petitioner challenged a clause in a notice inviting tender for the settlement of markets. The offending clause empowered the settling authority to settle the contract with the highest bidder even if necessary documents were not submitted at the time of bidding, provided they were furnished within three days of selection. The petitioner participated in the process but ranked 13th in terms of bid price. After being unsuccessful, the petitioner challenged the clause as being discriminatory and violating the principle of equality. The Single Judge dismissed the writ petition on the ground that the outcome would not be affected even if the clause were found invalid.

Findings of Court:
The court found that the appellant participated in the tender process without raising any initial objection. Once a bidder participates without protest and fails, they cannot turn around and challenge the fairness of the tender conditions. Additionally, because the appellant's bid was significantly lower than the highest bids, any ruling on the validity of the clause would not change the result for the appellant.

Issues: Whether a bidder who participates in a tender process without objection can subsequently challenge a clause in the tender notice after being unsuccessful; and whether a challenge to a general tender clause is maintainable when the petitioner would not benefit from the relief sought.

Ratio Decidendi: The court held that participation in a tender process without objection creates a bar against subsequently challenging the process upon failure. Furthermore, the court may decline to entertain a challenge to a general clause if the petitioner's specific circumstances ensure that they would not benefit from the strike-down of said clause.

Result: Appeal dismissed.

Legal Category Hierarchy

  • constitutional law
    • fundamental rights
      • right to equality (Para 5)
  • administrative law
    • government contracts and tenders
      • tender process
        • preclusion of challenge after participation (Para 10, 11)
  • practice and procedure
    • writ jurisdiction
      • maintainability
        • challenge after participation in tender (Para 10, 11)

Table of Contents

1. Appeal against dismissal of writ petition challenging tender clause — Appellant participated in tender process and was unsuccessful — Challenge after participation precluded. (Para 2 , 3 , 7 , 10 )

2. Appellant challenged tender clause as violative of Article 14 and relied on a previous judgment. (Para 5 , 9 )

3. Appeal dismissed — No merit found — Appellant precluded from challenging tender clause after participating and being unsuccessful. (Para 11 , 13 )

4. Can a tenderer who participated in a tender process without objecting to a clause later challenge that clause after being unsuccessful?

No, the law is well settled that such a challenge is precluded once the tenderer has participated without objection. (Para 10 , 11 , 13 )

5. Can a court decline to entertain a challenge to a tender clause if the petitioner would not benefit even if the challenge succeeds?

Yes, the court may refuse to examine the issues because even if answered in favor of the petitioner, it would have no effect on him. (Para 8 , 11 )

JUDGMENT :

A.D. Choudhury, J.

1. Heard Mr. F. K. R. Ahmed, learned counsel for the appellant. Also heard Mr. K. Konwar, learned Additional Advocate General appearing for P&RD, Department, Govt. of Assam.

2. The present intra court appeal is directed against the common judgment and order dated 23.11.2022 passed by the learned Single Judge in WP(C) 3320/2022 and connected appeals whereby the writ petition preferred by the present appellant was dismissed.

3. The aforesaid writ petition was preferred by the appellant assailing Clause-10 of an NIT dated 08.04.2022 floated by Darrang Zilla Parishad for settlement of Hat/Ghat/Min Mahals for the financial year 2022-2023.

4. The aforesaid offending Clause-10 empowers the settling authority to settle a ghat etc. with highest bidder even if the highest bidder had not submitted necessary documents, except Court Fee and earnest money, subject to the highest bidder furnishing such necessary documents within three days time from selection.

5. The offending clause was challenged primarily on the ground that it violates the principle of equality as enshrined under Article 14 of the Constitution of India. It was a further ground that, a learned Single Judge dealing with a challenge to a similar Clause in a similar NIT issued by the same authority held in its judgment dated 17.05.2022 passed in WP(C)/45/2022 ( Hasmat Ali –Vs- State of Assam ) that Clause- 10 if made applicable, then the same would be for the benefit of bidders whose bids were invalid at the time of their submission and the same would be to the prejudice of those bidders whose bids were compliant to terms and conditions of the tender notice at the time of their submissions. Such a situation is opposed to the principle of equality enshrined in Article 14 of the Constitution of India and same would clearly be discriminatory and same would be unjust to a bidder who is otherwise a “valid” bidder in terms of Rule 47 (10) of the Assam Panchayat Financial Rules, 2002.

6. As many as 5 (five) writ petitions were filed on similar grounds assailing the offending tender clause.

7. Pursuant to the NIT, The writ petitioner submitted bids in respect of two Markets, Tangny Weekly Open Market and Tangny Weekly Cattle Market. It is an admitted fact that the petitioner was placed at 13th position in terms of bid price offered in respect of the said markets against the highest bid of Rs. 10,50,201/- and Rs. 51,15,501/- respectively.

8. The learned Single Judge has declined to examine the issues raised by the present appellant/writ petitioner for the reason that even if such issues raised are answered in favour of the petitioner, the same is not going to have any effect whatsoever on the petitioner.

9. The learned counsel for the appellant basically assails the judgment of the learned Single Judge on the ground that the learned Single Judge while deciding the issue raised, had failed to consider the ratio laid down in Hasmat Ali (supra) and did not entertain such challenge to Clause- 10 relying on the judgment of the Hon’ble Apex Court in Michigan Rubber (India) Ltd. –Vs- State of Karnataka reported in (2012) 8 SCC 216 and held that no malafide or favouritism has been made out as the offending Clause is a general one.

10. From the pleadings made in the writ petition and from the impugned order, it is clear that the petitioner without raising any challenge to the offending Clause of the NIT, participated in the tender process in respect of two markets in question and when he became unsuccessful, turned around and challenged the Clause-10 of the tender. The law is well settled that when a tenderer participates in a tender process without objection and subsequently found to be not successful, a challenge to the process is precluded. Such a tenderer cannot be allowed to turn around and contend that the process was unfair by virtue of existence of a Clause in the NIT.

11. This Court cannot also find fault with the decision of the learned Single Judge in not entertain

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