Back
IN THE HIGH COURT OF JUDICATURE AT MADRAS
T. RAJA, D. BHARATHA CHAKRAVARTHY, JJ.
Quality Property Management Service Private Limited, Represented by its Director Chinta Bharath – Appellant
Versus
Tamil Nadu Textbook & Educational Services Corporation, EVK Sampath Maaligai, D.P.I Campus, Chennai & Another – Respondents
W.A. No. 660 of 2023 & C.M.P. No. 6613 of 2023
Decided On : 20-04-2023
Tender Criteria - Public Interest - Tamil Nadu Transparency in Tenders Act, 1998 - [III (3), (4), (5)] - The court considered the eligibility criteria prescribed for a tender to provide housekeeping, sanitation, and security services in schools. The court found that the criteria were arbitrary and irrational, leading to exclusion of most bidders, and failed to serve public interest. The court set aside the impugned tender and directed the respondents to frame new conditions in the best interest of the work and to consider making knowledge of Tamil or the local language mandatory for the employees of successful bidders.
Fact of the Case:
The Writ Appeal challenged the order of the learned Single Judge, which upheld the eligibility criteria prescribed for a tender to provide housekeeping, sanitation, and security services in schools. The petitioner contended that the criteria excluded most bidders and were contrary to public interest. The respondents modified the conditions after the Writ Petition was filed.
Finding of the Court:
The court found that the eligibility criteria were arbitrary and irrational, leading to exclusion of most bidders and failing to serve public interest. The court set aside the impugned tender and directed the respondents to frame new conditions in the best interest of the work and to consider making knowledge of Tamil or the local language mandatory for the employees of successful bidders.
Issues: The issues involved the validity of the eligibility criteria prescribed for the tender and whether they served public interest.
Ratio Decidendi: The court held that the eligibility criteria must serve public interest and provide a level playing field for all bidders. The Tender Floating Authority must justify the conditions and show application of mind. The court can interfere when public interest of due participation of bidders is affected by the tender conditions.
Final Decision: The Writ Appeal was allowed, the impugned order was set aside, and the impugned tender was quashed. The respondents were directed to frame new conditions in the best interest of the work and to consider making knowledge of Tamil or the local language mandatory for the employees of successful bidders.
JUDGMENT
(Prayer: Writ Appeal filed under Clause 15 of the Letters Patent against the order, dated 16.03.2023 in W.P.No.7276 of 2023.)
D. Bharatha Chakravarthy, J.
1. This Writ Appeal is directed against the order of the learned Single Judge, dated 16.03.2023 made in W.P.No.7276 of 2023, in and by which, the Writ Petition filed by the petitioner challenging the tender floated by the respondents bearing Ref.RC No.613/PUR-1/2023 inasmuch as it prescribed Criteria III (3), (4) and (5).
2. The gist of the grievance of the petitioner in the Writ Petition is that for the first time, the respondents are inviting tenders to provide housekeeping, sanitation, and security services in all the schools run under the School Education Department in the State of Tamil Nadu. For the purpose of inviting tender, for the reasons best known to the respondents, they have divided the 38 districts into four zones and are inviting tenders. The tender documents prescribe detailed eligibility criteria, inter alia, the following conditions were made:-
| Sl. | Criteria | Proof |
|---|---|---|
| 1 | ... | ... |
| 2 | ...
| ... |
| 3 | The bidder should have carried out the above services in at least 25,00,000 sq. ft. (Twenty-Five Lakh Square feet) either in a single or multiple contracts (not more than 3), in any one of the last three financial years (2019 – 20 to 2021-22), having the nature and complexity equivalent to the services called for in the present tender, with satisfactory performance on the date of bid opening. | Copies of contracts evidencing handling of the minimum building area of at least 25,00,000 sq. ft. (Twenty-Five Lakh Square feet) in any one of the last three financial years (2019 – 20 to 2021-22) towards housekeeping services either in single or multiple contracts in the same year, having the nature and complexity equivalent to the services called for in the present tender. End-user certificates for satisfactory performance also to be submitted. |
| 4 | The average annual turnover of the bidder should not be less than Rupees 50 (Fifty) Crore in the last three financial years (2019 – 20, 2020-21, and 2021-22). | Audited P&L statement for the last 3 FYs (2019 – 20 to 2021-22). |
| 5 | The bidder should have the experience of having employed a minimum of 5,000 personnel throughout the year in each of the last three financial; years (2019 – 20 to 2021-22) in the field of Housekeeping, Sanitation and Security services, either in single contract or multiple contracts (not more than 3) in the same year. Note:In the proof submitted for the projects, at least 4,500 personnel should be in the area of housekeeping and sanitation services. | CA audited statement of manpower wages for a minimum of 5,000 personnel employed throughout the year in each of the last three years (2019 – 20 to 2021-22) should be submitted. Also, Proof of PF/ESI details of employees of last year FY 2021 – 2022 must be submitted.Note:Bidder should submit affidavit in Rs.100 Non-Judicial paper that in the event of work is awarded to our agency: the wages to be paid to the workers engaged shall not be less than the minimum wages determined by Tamil Nadu State Govt. Authority from time to time. |
3. All that the respondents want is that the successful bidders should do the housekeeping i.e., cleaning the schools including the toilets and keeping the premises clean and providing security services at the gate. It is very much a doable job for any entrepreneur or organisation which can provide these services. But, however, the respondents without any basis whatsoever have included the said criteria which will exclude 99.9% of the intending bidders. Thus, virtually excluding competition and making it monopolistic to one or two giants alone who are already in the business, is opposite to rule of law. The purpose of floating tenders or framing tender conditions should only be in public interest and in the instant case, they are anathema to public interest. The petitioner also would compare the exercise done by the State of Tamil Nadu in res
The main legal point established is that eligibility criteria for tenders must serve public interest, provide a level playing field for bidders, and be justified by the Tender Floating Authority. The....
The main legal point established in the judgment is the limitation of judicial review in tender matters, the need for commercial prudence in evaluating tenders, and the importance of fairness and non....
Eligibility for contracting: To foster competition, firms and individuals to offer goods, work, and services required for the program, any conditions for participation shall be limited to those that ....
Tender conditions upheld as reasonable for bidder integrity, safety and compliance; judicial review in contracts limited to arbitrariness, mala fides or public interest, with deference to administrat....
The imposition of arbitrary turnover requirements in tender processes, lacking rational justification, violates Articles 14 and 19(1)(g) of the Constitution, ensuring fair opportunity and competition....
Judicial review of tenders limited to arbitrariness or malafide; eligibility conditions upheld if public interest served with multiple qualified bidders; bid time reduction valid with approval; ineli....
Judicial review of tender conditions is restricted to cases of arbitrariness or unreasonableness, reinforcing that the authority determining eligibility criteria has the discretion and expertise in c....
Judicial review of tender conditions is limited; courts should not interfere unless actions are arbitrary, discriminatory, or mala fide, ensuring public interest is prioritized.
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
