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2017 Supreme(Mad) 421

IN THE HIGH COURT OF JUDICATURE AT MADRAS
B. RAJENDRAN, J.
M/s. Flemingo Duty Free Shop Pvt. Ltd. – Petitioner
Versus
Airports Authority of India (Southern Region), Chennai – Respondent
Writ Petition No. 15777 of 2016 and W.M.P. Nos. 13689, 17205, 33437, 33590 of 2016
Decided On : 23-03-2017

Advocates Appeared:
For the Petitioner: Mr. P.S. Raman for Mr. L. Murali Krishnan.
For the Respondents: Mr. Vijaynarayan for Mr. Parthiban, Mr. A.R.L. Sundaresan and Mr. R. Nalliappan.

The court emphasized the limitations of judicial review in contractual matters and the need to prove mala-fides or arbitrariness in the decision-making process to warrant interference by the court.

Headnote:

The petitioner challenged the legality and/or validity of the order rejecting their objections to the documents submitted by the second respondent for the tender at Madurai Airport. The court analyzed the eligibility criteria, financial turnover, and experience requirements as per the RFP and REP. The court also considered the scope of judicial review under Article 226 of The Constitution of India and the limitations of the court's interference in contractual matters. The court found that the tender process was fair and transparent, and the eligibility of the second respondent was assessed by a committee of experts. The court dismissed the writ petition.

ORDER :

1. In this writ petition, the petitioner calls in question the legality and/or validity of the order dated 24th March 2016 passed by the first respondent in and by which the first respondent rejected the objections raised by the petitioner with regard to the documents submitted by the second respondent pursuant to the tender floated by the first respondent for awarding duty free outlets at Madurai Airport.

2. The petitioner company claims to be the first private entity in India to be engaged in the business of operation and management of Duty Free Shops which sell duty free goods at Airports and Seaports in India. According to the petitioner, they are operating such Duty Free Shops in International Airports at Chennai, Calicut, Mangalore, Goa, Kolkatta, Trichy and Ahamedabad. The petitioner also claims to be operating 28 such duty free shops at various Airports and Seaports in India. While so, during August 2015, the first respondent floated the Request for Proposal (RFP) for Madurai International Airport to design, built, operate and maintain duty free outlets. The petitioner as well as the second respondent participated in the RFP Subsequent to the tender notification issued during August 2015, the first respondent has also issued various corrigendum. Thereafter, during September 2015, the first respondent cancelled the tender itself which was floated during August 2015 with an intention to float a fresh tender. Accordingly, on 23.09.2015, a paper publication was effected by the first respondent inviting tender applications for running duty free shops in 14 Airports, including Madurai Airport. On the next day namely 24.09.2015, the first respondent issued a second tender notification and it was followed by atleast two corrigendums issued by the first respondent.

3. As far as the petitioner company is concerned, they have participated in the pre-bid meeting, As per the tender conditions and the corrigendums issued thereof, the petitioner made on-line submission of the bids (technical as well as financial) in the e-tender portal before 18th January 2016, the last date indicated by the first respondent for submission of the bids. On 18.02.2016, the petitioner was informed that the financial proposal will be opened on 19.02.2016 at the office of the first respondent.

4. In the meantime, the first respondent issued a similar Request for Proposal (RFP) during September 2015 to design, build, operate and maintain duty free shops at Trivandrum International Airport and after evaluating the bids of the tenderers, the first respondent awarded the tender in favour of the second respondent herein. Challenging the same, the petitioner has filed WP (C) No. 861 of 2016 before the Kerala High Court and obtained an interim stay. The writ petition was filed before the Kerala High Court by specifically contending that the second respondent does not fulfil the threshold eligibility criteria indicated in RFP. On the basis of such pleading, the Kerala High Court directed the first respondent to produce the documentary records of the second respondent to examine the claim of the petitioner. Ultimately, the Kerala High Court dismissed the writ petition on 12.02.2016 against which the petitioner has filed W.A. No. 354 of 2016 before the Division Bench of the Kerala High Court and the appeal is pending.

5. As far as the present tender notification is concerned, after the financial bids were opened, the first respondent, by an order dated 29.02.2016, selected the second respondent as the highest bidder for running duty free shops at Madurai Airport. The petitioner objected to the selection of the second respondent on the ground that in the website of TEWA, which is the world's biggest duty free and travel retail association, the name of the second respondent is mentioned only as an "Agent/Distributor" and not as a duty free retail operator. On the other hand, the petitioner regularly participates in the Summits held during 2013, 2014 and 2015 and t




































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