BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
HEMANT CHANDANGOUDAR, J.
Texmaco Rail and Engineering Limited Represented by its Authorised signatory Abhijit Sanyal – Petititioner
Versus
The Deputy Chief Signal and Telecommunication Engineer Project Trichy – Respondent
W.P.(MD) Nos.5282 to 5285 of 2026 and W.M.P.(MD) Nos4419, 4421, 4425 to 4429 and 4431 of 2026
Decided On : 04-03-2026
ORDER :
HEMANT CHANDANGOUDAR, J.
The issue involved in all these writ petitions is identical. Hence, they were taken up together, heard, and are being disposed of by way of this common order.
2. The challenge in these writ petitions is to the rejection of the technical bids submitted by the petitioner pursuant to four Tender Notifications issued by the first respondent for the works enumerated therein. The bids were rejected on the ground that the tender documents were submitted by a power of attorney holder who had been authorized by the Committee of the Company and not by the Board of Directors.
3. The first respondent issued four Tender Notifications on 31.10.2025 for carrying out works relating to interlocking arrangements. In response to the said notifications, the petitioner submitted four bids. The bids were submitted through a power of attorney holder. Upon opening the technical bids, the first respondent found that the power of attorney holder had been authorized only by a resolution of the Committee and not by a resolution of the Board of Directors. On that ground, the technical bids submitted by the petitioner were rejected. Aggrieved by the said rejection, the petitioner has filed the present writ petitions.
4. Mr. R. Murali, learned Senior Counsel appearing for the petitioner, assisted by Mr. Thriyambak J. Kannan and Mr. T. Aswin Raja Simman, learned counsel, submitted that non-furnishing of the resolution of the Board of Directors is not an essential requirement. According to the learned Senior Counsel, as per Clause 15 of the Tender Notification, the Tender Inviting Authority has the discretion to seek clarification with regard to any deficiency in the documents enclosed along with the bids. Therefore, the authority ought to have exercised its discretion and called upon the petitioner to furnish the resolution of the Board of Directors. It is his submission that the non-production of such resolution is only a curable defect, and without affording an opportunity to rectify the same, the rejection of the petitioner’s technical bids is arbitrary and unsustainable.
5. The learned Senior Counsel further submitted that the Committee had authorized the execution of the power of attorney pursuant to a resolution passed by the Board of Directors. He also contended that, under Object Clause 99 of the Articles of Association of the petitioner-Company, the Board of Directors is empowered to delegate its powers to the Committee. In support of his submissions, reliance was placed on the following decisions:
(i) Atlanta Limited vs. National Highways Authority of India and another, reported in 2025 SCC Online 2183; and
(ii) Bhagwati Prasad vs. Shiromani Sugar Mills Ltd., reported in (1949) 19 Comp Cas 286 : 1948 SCC Online All 88
6. Per contra, Mr. K. Govindarajan, learned Deputy Solicitor General of India appearing for the first respondent, submitted that one of the essential requirements under the Tender Notification is that any individual signing the tender document or any document connected therewith must clearly specify the capacity in which he signs the document, namely: (i) as a Director, Manager, Secretary, or other official having the requisite authority; or (ii) as an Attorney authorized in accordance with the Memorandum or Articles of Association of the Company.
7. In the present case, the petitioner had produced only the resolution of the Committee along with the power of attorney executed in favour of the individual who submitted the bids. However, the petitioner failed to produce the resolution of the Board of Directors authorizing such participation in the tender process. According to the learned Deputy Solicitor General, the resolution of the Board of Directors is an essential document. Since the petitioner failed to produce the said essential document, the first respondent was justified in rejecting the technical bids.
8. The learned Deputy Solicitor General further submitted that Section 179 of the Companies Act provide
The court ruled that rejection of bids on technicalities lacking a Board resolution is arbitrary, given guidelines on acceptable authorizations under tender conditions.
The court affirmed that technical disqualification in public tendering must not be hyper-technical if it does not affect the bidder's capacity to perform, emphasizing the importance of fair competiti....
The rejection of a tender bid based on a non-essential requirement is arbitrary and violates principles of fair administrative action.
Important Point – Government Contract – Tender – Public authorities have to ensure that no bias, favouritism or arbitrariness are shown during bidding process and that entire bidding process is carri....
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 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 requirement of compliance with mandatory tender conditions, reaffirming that failure to submit necessary documents, like a Power of Attorney, results in bid rejection.
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