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2022 Supreme(Jhk) 258

IN THE HIGH COURT OF JHARKHAND AT RANCHI
RAJESH SHANKAR, J.
Suruchi Foods Private Limited – Appellant
Versus
State of Jharkhand – Respondent
W.P.(C) No. 260 of 2022
Decided on : 22-06-2022

Advocates:
Advocate Appeared:
For the Appellant :Mr. Indrajit Sinha, Mr. Kumar Vaibhav, Advocate
For the Respondent:Mr. Rajiv Ranjan, Mr. Mohan Kumar Dubey, Mr. Biren Poddar, Mr. Deepak Kumar Sinha, Mr. Piyush Poddar, Ms. Rakhi Sharma, Mr. Kalyan Roy, Mr. Gaurang Jajodia, Advocate

Headnote:(A) Public procurement - e-Tender Ref. No. PRO-01/2021-22 - Quashing of disqualification from tender process - Petitioner disqualified due to foreclosure of agreement by another state and alleged financial linkage with disqualified bidder - Grounds included misleading declarations and failure to disclose past contractual issues. (Paras 2, 6, 50, 53)

(B) Tender Evaluation - Judicial review - Courts will not interfere unless the decision-making process is arbitrary, irrational, or in violation of natural justice. The essence of law emphasizes the need for clarity in the tender terms and justified reasons for disqualification. (Paras 24, 34, 36)

Facts of the case:
The petitioner challenged being disqualified from a state tender, claiming the decision was irrational and based on irrelevant grounds including foreclosure claimed from another state's agreement and alleged financial links with a different bidder.

Findings of Court:
The Court found the procurement committee acted within its rights by disqualifying the petitioner based on established criteria which included the history of contractual performance and relevant disclosures.

Issues: The legitimacy of the grounds for disqualification and whether the tender process adhered to principles of natural justice were the central questions.

Ratio Decidendi: The court reaffirmed that where there exist clear grounds for disqualification, the procurement authority's decisions justified, and judicial restraint is exercised in contract matters unless severe arbitrariness is observed.

Result: Writ petition dismissed.

JUDGMENT :

The present writ petition has been filed for quashing/setting aside the decision taken by the procurement/purchase committee in its meeting dated 18.01.2022 (Annexure-3 to the writ petition) held under the chairmanship of Director, Social Welfare (the respondent no. 2) whereby the petitioner has been technically disqualified from participating in e-Tender Ref. No. PRO-01/2021-22 dated 17.11.2021 issued by the Directorate of Social Welfare, Department of Women, Child Development and Social Security, Government of Jharkhand. Further prayer has been made for issuance of direction upon the respondent nos. 1 and 2 to allow the petitioner to participate and compete in the financial bid as well as to quash the work order, if any, issued in favour of any other bidder(s).

2. The factual background of the case as stated in the writ petition is that the Directorate of Social Welfare, Department of Women, Child Development and Social Security, Government of Jharkhand issued a notice inviting tender bearing e-Tender reference no. PRO-01/2021-22 on 17.11.2021 for supply of “Micronutrient Fortified and/or Energy Dense Food (MFEDF)” as supplementary nutrition (Take Home Ration) for distribution among children from 06 months to 03 years of age, Severely Acute Malnourished (SAM) children from 06 months to 06 years of age, pregnant women and lactating mothers under ‘Anganwadi Services’ Scheme of Umbrella ICDS through 38,432 Anganwadi Centres in the State of Jharkhand. The petitioner and others participated in the said tender by submitting requisite documents however as per the Technical Evaluation Summary details (Tender Summary Reports) which was uploaded on the online portal of Jharkhand Tenders (e-Procurement System of Government of Jharkhand) on 18.01.2022, the technical bid of the petitioner was rejected by the procurement/purchase committee.

3. Mr. Indrajit Sinha, learned counsel appearing on behalf of the petitioner, submits that the petitioner has been technically disqualified mainly on two grounds- firstly on the ground that the action of foreclosure of agreement was taken by the Department of Women & Child Development, Gandhinagar, Gujarat against the petitioner and secondly on the ground that the agreement of a company namely M/s. Murliwala Agrotech Pvt. Ltd., which was allegedly found to be a group company of the petitioner having financial linkage with it, was foreclosed by the Department of Women & Child Development, Gandhinagar, Gujarat. It is further submitted that both these grounds are wholly perverse, non-est and arbitrary. The procurement/purchase committee’s decision is based on irrelevant considerations which are not germane to the petitioner’s eligibility under the terms of tender, making the entire decision as well as decision making process irrational being wholly arbitrary, warranting interference of this Court.

4. Learned counsel for the petitioner further submits that so far as the first ground is concerned, a work was allotted to the petitioner by the Integrated Child Development Services (I.C.D.S.), Department of Women and Child Development, Government of Gujarat wherein foreclosure notice dated 08.11.2011 was given to it, however considering the reply of the petitioner, the agreement entered by the petitioner with I.C.D.S., Gujarat for the aforesaid work was extended up-to 31.03.2012 by the Director I.C.D.S., Gujarat vide its letter dated 03.01.2012. It is further submitted that since the petitioner was participating in another tender process, it requested for issuance of a consolidated performance certificate from I.C.D.S., Gujarat which was issued to the petitioner on 30.10.2013, however a remark was erroneously made by the I.C.D.S., Gujarat mentioning inter alia that earlier tender of the petitioner was foreclosed due to prolonged delay in production and supply despite the fact that there was no foreclosure in existence. The petitioner challenged the said remark before the Gujarat High Court by filing Spe

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