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2021 Supreme(MP) 843

High Court of Madhya Pradesh
Mohammad Rafiq, C. J., B. K. Shrivastava, J.
SHRISHTI INFRASTRUCTURE DEVELOPMENT CORPORATION LTD. - APPELLANT
Versus
STATE OF M. P. & ORS. - RESPONDENTS
W. P. No. 10786 of 2021
Decided On : 30-06-2021

Advocates Appeared:
For Appellant : Prashant Singh, Sanket Anand
For Respondent: Pushpendra Yadav, Purushaindra Kaurav, S. S. Sharma

The decision of the employer in interpreting the conditions of eligibility in a tender document must be respected unless it is shown to be arbitrary, outrageous, and highly unreasonable.

Headnote:

Tender Rejection - Eligibility Criteria - Annexure-C - [Financial I. Experience of having successfully executed, completed and commissioned, a) three similar works each costing not less than the amount equal to 20% of the probable amount of contract during the last 5 financial years : or b) two similar works each costing not less than the amount equal to 30% of the probable amount of contract during the last 5 financial years : or c) one similar work of aggregate cost not less than the amount equal to 50% of the probable amount of during the last 5 financial years:] - The court discussed the interpretation of the eligibility criteria in Annexure-C of the NIT, emphasizing the requirement for successful execution, completion, and commissioning of similar work. The court highlighted the importance of adhering to the terms of the tender document and the authority of the employer to interpret the conditions of eligibility. The judgment emphasized that the decision of the employer must be respected unless it is shown to be arbitrary, outrageous, and highly unreasonable.

Fact of the Case:

The petitioner's bid was rejected as technically non-responsive due to not meeting the eligibility criteria of successfully executing, completing, and commissioning similar work as required in Annexure-C to the NIT.

Finding of the Court:

The court found that the rejection of the petitioner's bid was in accordance with the eligibility criteria specified in the tender document and that the interpretation of the relevant condition by the respondents was a possible interpretation. The court also noted the absence of any allegation of mala fide or undue favor shown to the successful bidder.

Issues: The issues revolved around the interpretation of the eligibility criteria in the tender document, the authority of the employer to interpret the conditions of eligibility, and the absence of mala fide or undue favor in the tender process.

Ratio Decidendi: The judgment emphasized the importance of adhering to the terms of the tender document and respecting the decision of the employer unless it is shown to be arbitrary, outrageous, and highly unreasonable. It highlighted the authority of the tender inviting authorities to interpret and apply the conditions of the tender, as well as the need for the interpretation to be reasonable and not obnoxious.

Final Decision: The writ petition was dismissed, and the rejection of the petitioner's bid was upheld.

ORAL JUDGMENT MOHAMMAD RAFIQ, C. J. : – This writ petition has been directed against the order Annexure-P/1 dated 7-6-2021 by which the bid of the petitioner submitted in response to notice inviting tender floated by the respondent-M. P. Urban Development Company Ltd. dated 25-2-2021, being technically non-responsive, has been rejected.

2. Mr. Prashant Singh, learned Senior Counsel submitted that the respondents in their tender document enclosed with the NIT Annexure-C laid down the pre-qualification criteria, which insofar as relevant for the present matter, provided that the bidder should have “experience of having sufficiently executed, completed and commissioned” “one similar work of aggregate cost not less than the amount equal to 50% of the probable amount of during the last 5 financial years.” It is contended that the petitioner submitted the experience certificate duly signed by the Project Director, Ganga Pollution Control Unit, U. P. Jal Nigam Kanpur, which clearly stated that the petitioner has completed and commissioned, to the extent of value of Rs. 328.6 crores, the work of “Survey, review the designs, redesign where necessary and build new sewerage network of about 102 km length and rehabilitation of existing small sized sewer and trunk sewer network of 198 km length including survey, design and construction of 2 no. of sewage pumping stations and 01 no. of lift stations and all appurtenant structures, and operation and maintenance of rehabilitated and new sewerage network and sewage pumping stations for a period of 10 years in Sewerage District-1 of Kanpur, State of Uttar Pradesh, India”.

3. Learned Senior Counsel for the petitioner submitted that the respondents have illegally rejected the bid of the petitioner as technically non-responsive on the premise that the petitioner does not have the experience of completion and commissioning of similar work as required in Annexure-C to the NIT. Learned Senior Counsel has referred to the communication issued by the Deputy Project Director (Technical) M. P. Urban Development Co. Ltd. rejecting their subsequent representation mentioning that the case of the petitioner has been reviewed in the light of their submission against the bid and the claim in their letter dated 8-6-2021. It was observed that the certificate dated 3-3-2021 of similar work claimed by the petitioner for eligibility does not mention “completion of work in totality”, hence the decision has been uploaded on the website of respondents stands confirmed without any change in the status of responsiveness of the bidders. Mr. Prashant Singh, learned Senior Counsel further argued that the conditions of the tender document have to be given purposive interpretation. The respondents required the similar work to have been successfully executed, completed and commissioned costing not less than the amount equal to 50% of the probable amount of contract value of the work in question for past 5 years. The petitioner not only executed, but also commissioned the work of the value of 328.06 crores, which is much more than the value of the work of which tender as has been floated by the respondents i.e. Rs. 226.94 crores. It is contended that the respondent-M. P. Urban Development Company has illegally awarded the work to respondent No. 4, who had quoted the bid of Rs. 208 crores as against the bid amount of Rs. 202 crores offered by the petitioner.

4. Mr. Purushaindra Kaurav, learned Advocate General appearing for the respondents submitted that for the purpose of examining the eligibility of the bidders in the process evaluation of the technical bid, the conditions of the tender cannot be split and one part cannot be read in isolation from another. Learned Advocate General referred to Annexure-C, the pre-qualification criteria, appended to the NIT and argued that it only intended to ensure that the bidder should ha

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