Withdrawal of a material member from a consortium during the bid validity period should be treated as withdrawal of the bid by the consortium, justifying bid security forfeiture.

Sushil Harkauli, J.

1. The first respondent invited bids by way of tenders for a certain project. The tenders consisted of three parts namely (1) pre-qualification bid (2) technical bid and (3) financial bid. The tender conditions permitted the tenders to be submitted by any organization/company or a consortium.

2. The writ petitioner formed a consortium (hereinafter in this order referred to as the consortium) with the third respondent i.e. Wipro Ltd. Amongst the members of the consortium, the petitioner declared itself as the prime bidder. 'Prime bidder' means some kind of a managing partner of a consortium, who acts on behalf of the consortium and with whom interaction in respect of the bidding activities is to take place. In respect of the tender submitted by it, the said consortium qualified in evaluation of the pre-qualification bid and thereafter also qualified in the evaluation of the technical bid. However, for passing these two stages, membership of the Wipro in the consortium played an important and material role as is mentioned in paragraph No. 15 of the return of the first respondent.

3. According to that paragraph no. 15, under the parameters prescribed for the purpose, the consortium obtained a total of 77 marks because of which the consortium qualified. Out of those 77 marks, the petitioner obtained 17 marks while Wipro obtained 60 marks. Thus it is absolutely clear that but for the membership of Wipro in the consortium, the petitioner could have cleared these initial two stages i.e. the stage of pre-qualification bid and thereafter the stage of technical bid.

4. The tender conditions required each bidder to furnish a bid security in the form of a demand draft/bank guarantee of Rs. 250 lakhs in favour of the first respondent. This condition is found in Clause 6.2 of the tender conditions. The tender also required that in the bids submitted it should be mentioned that the bid is valid for 6 (six) months from the date of submission of the bids, and that the bid validity period could be required to be extended further.

4-A. Factually, the bid submitted by the consortium stated that it was valid upto 28.4.2008. By a letter dated 21.4.2008 (Annexure P/8) the first respondent requested the petitioner to extend the validity period of the bid made by the consortium by 3 months i.e. upto 28.6.2008.

5. However, by a letter dated 28.4.2008, copy of which has been filed as Annexure R/10 to the additional reply of the first respondent, the period of bid validity was extended by the petitioner upto 28.7.2008

6. Within the period of the validity of the bid, the bidders were prohibited from withdrawing the bid. According to Clause 7.1.8 a bidder was allowed to modify or withdraw its submitted bid only upto any time prior to the last date prescribed for receipt of bids, by giving a written notice to the tenderer. Subsequent to the last date of receipt of bids and upto the expiry of the specified bid validity period, the bid could not be withdrawn by the bidder. It is provided in the said Clause that such withdrawal may result in the forfeiture of the EMD (bid security) of the bidder.

7. Clause 6.2 of the tender conditions also specifically provided that the bid security could be forfeited at the discretion of MPSEDC if a bidder withdraws its bid during the period of bid validity.

8. As stated above, the extended period of bid validity was upto 28.7.2008, and by then the pre-qualification bids and the technical bids had been opened, in both of which the consortium was successful. Only the financial bid remained to be opened. On 8.7.2008 the third respondent i.e. Wipro withdrew from the membership of the consortium, and sent a letter to that effect to the first respondent. Even uptill now it is not the case of the petitioner that Wipro has been brought back into the consortium; meaning thereby that the decision taken by the Wipro and communicated by the letter dt 8th July 2008 was firm and final and has remained firm.

9. Upon receivin