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IN THE HIGH COURT OF JUDICATURE AT MADRAS
ANITA SUMANTH, J.
Sasi Road Finishers and Engineering Contractor Rep. By its Managing Partner, B.Sangeethkumar, - Appellant
Versus
The Superintending Engineer, Highways Department – Respondent
W.P.No.14751 of 2024 & W.M.P.Nos.15991 & 15992 of 2024
Decided on : 20-06-2024
Tender - Writ Petition - Tamil Nadu Transparency in Tenders Rules 2000, 2012 - The court analyzed the conflict of interest provisions and the mandatory requirements for tender submissions, concluding that the petitioner's bid was invalid due to non-compliance with the Working Condition Certificate requirement.
Fact of the Case:
The petitioner, a registered partnership firm, sought to quash the rejection of its tender bid for a road widening project, arguing that the delay in obtaining a Working Condition Certificate (WCC) was not its fault and that the rejection was based on a conflict of interest.
Finding of the Court:
The court found that the petitioner's bid was invalid as it did not include the mandatory WCC, and the conflict of interest due to the relationship with another bidder was significant, leading to the rejection of the bid.
Issues: Whether the rejection of the petitioner's tender bid was lawful given the absence of a Working Condition Certificate and the alleged conflict of interest.
Ratio Decidendi: The court held that the absence of the WCC rendered the bid ineligible, and the relationship between the petitioner and another bidder constituted a conflict of interest, violating the principles of fairness in the tender process.
Result: The writ petition is dismissed.
ORDER :
Prayer : Writ petition filed under Article 226 of the Constitution of India praying to issue a writ of certiorarified mandamus calling for the records relating to the impugned orders (i) dated 17.05.2024 (Bid No.1046286) relating to Tender No .42/2023-2024/HDO dated 26.02.2024 passed by the 1st respondent, (ii) dated 25.03.2024 made in Na.Ka.No.Plant Certificate/E Va A/2024 and (iii) dated 04.04.2024 made in Na.Ka.No. Plant Certificate/E Va A/2024 passed by the 2nd respondent, quash the same and consequently direct the 2nd respondent to issue Working Condition Certificate of Plant and Equipment to enable the 1st respondent to
re-do the process of Technical Bid by including the petitioner’s name.
The petitioner is a registered partnership firm engaged in Government contract work from 1997. The subject-matter of this writ petition is an on-line tender notice relating to road widening issued by Uthangarai (H) C&M Sub-Division of the State Highways department for widening, from two land Paved Shoulders to Four Lane and Strengthening at KM 0/0 – 1/550 of connecting road between SIPCOT and Pochampalli – Kondamandapatti.
2. The tender notice was issued on 26.02.2024 and the documents were available for prospective bidders from 01.03.2024 on the Government website. The last date for submission of bids was 19.03.2024. The special conditions of contract made it mandatory for the bidder to enclose a Working Condition Certificate for plant and equipment (in short ‘WCC’) from the competent authority in the prescribed format. The certificate should have been obtained after the date of tender so as to ensure that the condition of plant and equipment was optimum. The special conditions made it more than amply clear that a bid unaccompanied by the WCC would be found ineligible.
3. The petitioner had submitted the application for WCC on 15.03.2024 to R1 both via email as well as through RPAD. However, unfortunately, as the mail had been sent after working hours, at 7.45 p.m. on a Friday evening, the request for WCC came to the attention of the respondents only on Monday i.e., 18.03.2024.
4. It is relevant to note that two separate applications for WCC had been sent under the cover of one email id being srfdharmapuri@gmail.com. The applications were on the letter-head of the petitioner firm and of P.Baskar, the petitioner’s father.
5. Since the respondents were of the view that there was a conflict of interest in the petitioner seeking WCC, both on its behalf as well as on behalf of his father, a competing bidder, a reply was sent to the petitioner by e-mail on 18.03.2024 asking that separate applications be made for issuance of WCC by the two bidders.
6. In the meantime, the petitioner had, on 17.03.2024, submitted its bid without enclosing the WCC. Condition 2 under the special condition for plant and machineries states clearly that ‘the working conditions for the above machineries obtained after the date of tender notice from the Divisional Engineer (QC) concerned should be uploaded in original, the tender received without the above certificate shall be rejected’. Thus, the petitioner’s bid without the mandatory enclosure of the WCC was technically invalid.
7. Vide letter dated 25.03.2024, R2 states that the petitioner’s bid was ineligible as the request for WCC had been received from the petitioner only on 25.03.2024, beyond the last date of tender, being 19.03.2024. On 02.04.2024, the petitioner points to his requisition dated 15.03.2024 and that such request had been received by R2 on 18.03.2024 (by RPAD). In fact, the request sent by e-mail had been received on 15.03.2024 itself.
8. On 04.04.2024, the petitioner’s bid is rejected by R2 for the aforesaid reasons i.e., that the request for WCC had been made in common by the petitioner and his father, and that the petitioner’s bid had been submitted without enclosing the WCC. However, as that communication has been issued by R2, the Divisional Engineer, who is not the Tender Inviting Authority
The court established that compliance with mandatory tender requirements and the avoidance of conflicts of interest are essential for valid participation in government tenders.
The court upheld the authority's discretion in evaluating tender bids, emphasizing the need for compliance with mandatory conditions and the absence of arbitrariness in disqualification decisions.
Judicial review in tender matters is limited to ensuring fairness and non-arbitrariness; minor technical defects in bids do not justify interference unless proven arbitrary or mala fide.
Judicial review in tender matters is limited to assessing procedural fairness, not the merits of the tender conditions, which are determined by the tendering authority.
The court upheld the tendering authority's discretion in setting eligibility criteria, emphasizing limited judicial review focused on procedural fairness rather than the merits of the decision.
Judicial review of tendering decisions is limited to assessing legality, with courts refraining from substituting the tender authority's decisions unless in cases of illegality or manifest arbitrarin....
Judicial review of tender decisions is limited; compliance with stipulated conditions is mandatory, and non-compliance justifies rejection.
Remitted the matter back to the High Court for deciding the matter on merits even when the subject tender had already been finalized and the purchase order had been issued to the successful.
An unsuccessful bidder lacks standing to challenge the issuance of a Letter of Intent when disqualified for failing to meet mandatory requirements.
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