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2013 Supreme(J&K) 676

HIGH COURT OF JAMMU AND KASHMIR AT JAMMU
Tashi Rabstan, J.
Nayak Infrastructure Pvt. Ltd. -Appellant
Versus
State & Ors. -Resopndent
OWP No. 1169-2012, CMA No. 1964-2012, CMA No. 1622-2012 c-w OWP No. 1170-2012, CMA No. 1623-2012 & CMA No. 1965-2012
Decided On : 13-12-2013

Advocates Appeared:
P.N. Raina , J.A. Hamal, R.K. Gupta, Prem Sadotra, Seema Sheikher, M.K. Bhardwaj, Ajay Abrol, Ex-parte.

The rejection of bids must be in accordance with the terms and conditions of the contract and not arbitrary or unfair. Public interest requires only valid and responsive bidders to participate in the financial bid and/or award of the contract.

Headnote:

Tender Rejection - Contractual Dispute - [Section 14 of the Constitution of India, Article 226, General Conditions of Contract, Tata Cellular v. Union of India, Tejas Constructions and Infrastructure Private Limited v. Municipal Council, Sendhwa] - The court examined the rejection of technical bids by the respondents and held that the condition regarding the submission of authorization letter was a vital and essential condition of the contract, not merely ancillary or subsidiary. The rejection of the bids was found to be in accordance with the terms and conditions of the contract and not arbitrary or unfair. The court dismissed the writ petitions and emphasized that public interest requires only valid and responsive bidders to participate in the financial bid and/or award of the contract.

Fact of the Case:

The petitioner-company, a registered contractor, submitted bids for road construction works but its technical bids were rejected by the respondents for not complying with the condition of submitting an authorization letter in favor of the signatory.

Finding of the Court:

The court found that the rejection of the bids was in accordance with the terms and conditions of the contract and not arbitrary or unfair. It emphasized the importance of only allowing valid and responsive bidders to participate in the financial bid and/or award of the contract.

Issues: The main issue was the rejection of the petitioner's technical bids for road construction works due to non-compliance with the condition of submitting an authorization letter in favor of the signatory.

Ratio Decidendi: The court held that the condition regarding the submission of the authorization letter was a vital and essential condition of the contract, not merely ancillary or subsidiary. It emphasized the importance of public interest in allowing only valid and responsive bidders to participate in the financial bid and/or award of the contract.

Final Decision: The court dismissed the writ petitions and emphasized the importance of public interest in allowing only valid and responsive bidders to participate in the financial bid and/or award of the contract.

1. Since there is a common question involved in these two petitions, therefore, the same are being disposed of by this common judgment.

2. Briefly stated, the facts of the first writ petition, namely, OWP no. 1169/2012, are that petitioner-company which claims to be an approved and registered class 1(A) Contractor with PWD (Roads) Assam, Guwahati-3 and is engaged in the business of Architects, Engineers, Builders, Contractors, Designers, Planners, etc., responded to NIT No. CEJ/PMGSY/70 of 2011-12 dated 13.03.2012 through the e-tendering mode. The petitioner --company claims to have submitted its bid for the following three works viz.

(i) Construction of Road from Block Boundary Ghordi to Kotwait Part-II, Phase VIII, Stage Ist, Block Ramnagar, District Udhampur, Package No. JK14-174;

(ii) Construction of Road from Charal to Nappah, Phase VIII, Stage Ist, Block Dudu, District Udhampur, Package No. JK14-166.

(iii) Construction of Road from Banjian to Motto, Phase VIII, Stage Ist Block DUDU, District Udhampur, Package No. JK14-182.

3. In the second writ petition, OWP No. 1170/2012, the petitioner-company is stated to have responded to NIT No. CEJ/PMGSY/61 of 2011-12 dated 29.02.2012 identically through the same mode, submitting its bid for the following three works viz.,

(i) Construction of Road from KM 13th TKN Road to Challer, Block Thathri, District Doda, Package No. JK04-147, Phase-VIII Stage 1st.

(ii) Construction Road from Thathri to Chira, Block Thathri, District Doda, Package No. JK04-148, Phase-VIII Stage 1st.

(iii) Construction of Road from KM 2nd L025 to Champal, Block Bhallesa, District Doda, Package No. JK04-151, Phase-VIII Stage 1st.

4. The grievance projected by the petitioner-company in these writ petitions is that its technical bids have been rejected by respondent No. 2 by declaring them as `Non-Responsive'.

5. The petitioner-company claims that the reason assigned for rejecting the technical bid qualification of the petitioner company is that the authorization letter in favour of its authorized representative had not been attached with the bid documents. The petitioner-company has, therefore, challenged rejection of its bid for the aforesaid works by declaring the same as `Non-Responsive' primarily on the ground that rejection is illegal and wholly arbitrary and, therefore, violates rights guaranteed to the petitioner-company under Article 14 of the Constitution of India. The rejection of bids submitted by the petitioner company has further been assailed on the ground that the condition in the tender notice/NIT with regard to enclosing of authorization letter in favour of an authorized representative was merely ancillary and subsidiary condition and not the main and substantive condition or essential condition of eligibility. On this basis, it is contended that rejection of bids for not fulfilling ancillary and subsidiary condition could not be construed to be non-fulfilment of the basic conditions of eligibility laid down in the NIT. It is further stated that authorization letter in favour of an authorized representative, namely, Sanjiv Singh was already in existence when NIT was issued and failure to enclose the same with the tender documents was only an advertent omission, not fatal to the contract, and that the deficiencies pointed out by the department in this regard were duly supplied before opening the technical bid.

6. On the other hand, respondents in their objections have stated that in absence of authorization letter by the company in favour of authorized representative/signatory, submission of tender documents was found to be by a private party, who was the partner in some other firm. The respondents in their objections have pointed out the following deficiencies which were found in the tender documents of the petitioner-company:

1. that no contact Number, Facsimile (Fax) details/e-Mail ID of the Firm was uploaded/submitted.

2. that no document in respect of authorized signatory has been submitted through websit
























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