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2024 Supreme(MP) 198

IN THE HIGH COURT OF MADHYA PRADESH
Ravi Malimath, CJ, and Vishal Mishra, J.
Vikas Road Carriers, A Partnership Firm v. Central Warehousing Corporation & Another
Writ Petition No. 22427 of 2023 (Jabalpur); Decided on 20.3.2024

Advocates:
Naman Nagrath with Rahul Diwakar for petitioners;
Amit Singh for respondent No. 1; Amit Dave for respondent No. 2.

Headnote:

(1) Tender -- as per Cl. 11 of GeM Incident Management Policy, seller suspended at time of financial bid opening date/time will be marked as "disqualified" due to suspension -- L-1 bidder petitioner's account placed under suspension during bid opening date -- authorities rightly arrived at conclusion that they should go for fresh tender -- mere declaration of price by petitioner will not be of help to him for reason that he himself was at fault for not maintaining active account on GeM portal at time of consideration of bid -- interference declined. [Paras 13 & 18]

(2) Constitution of India -- Art. 226/227 -- scope of judicial review -- tender -- interference in tender matters is limited to certain extent. 2023 SCC Online SC 671 and (2020) 16 SCC 489 followed. [Para 14]

(3) Tender -- no right created in favour of bidder merely by participating in tender -- tendering authority cannot be precluded from its option to cancel tendering process on any ground -- tendering process can be cancelled at any stage before finalization -- tender is only an invitation to offer -- other party makes offer pursuant to invitation to offer -- not obligatory for authority to accept offer -- no right created on basis of merely being L-1 -- respondent well within its right to cancel tender before acceptance was made -- right would accrue when contract comes into existence. [Para 16]

(4) Contract -- tender -- always in domain of NIT issuing authority to take decision -- rejection of bid is purely administrative decision -- rights are reserved whether to accept/cancel tender without assigning any reason -- decision of Corporation shall be final and binding on tenderer. [Para 17]

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ORDER

Mishra, J-- 1. This petition has been filed by the petitioner assailing the arbitrary action on the part of the respondent No.1 whereby the tender/bid of the petitioner has been cancelled for the reason which is not attributed to the tender documents.

2. It is the case of the petitioner that the petitioner is a partnership concern registered under the provisions of the Partnership Act. The respondent No.1 has floated tender for appointment of service provider for handling of Cement, Food grains and allied products i.e. Salt, Fertilizer and other commodities etc. of various depositors/udders at its Railside Warehouse Complex (RWC) Nishatpura Bhopal. The entire bid process was to be held on the respondent No.2 i.e GeM portal i.e. “Government e Marketplace” portal and the tender document was to be purchased from the said portal and other documents were to be uploaded on the said portal only. Clause 13 of the tender document provides that GeM portal is used only as a platform for procurement/tendering for appointment of service provider for Handling Rail/Road Borne Cargo at Rail side warehouse complex. All the terms and conditions contained in this NIT shall be applicable in whole tender process. The petitioner submitted the bid documents. In all five bids were received, out of which four bids could not qualify in the technical evaluation and after opening of the financial bid, the petitioner was declared as the lowest bidder (L1). He was waiting for the issuance of an LOI but to his utter surprise, the petitioner was shocked to see that his bid has been cancelled by the respondent.

3. It is argued that declaration of petitioner as L1 bidder by the tender inviting authority amounts to a concluded contract so far as respondent No.1 is concerned. So there cannot be any cancellation of the accepted bid of the petitioner. The petitioner’s tender has been cancelled for the reason that profile of the petitioner was suspended by the GeM portal owing to some dues which the petitioner has to pay to the GeM portal. The same are alien to the tender document. It is submitted that the bid of the petitioner has not been cancelled for any reason which are attributable to the tender inviting authority nor for any non-compliance or non-adherence to any of the terms and conditions of the tender inviting authority or the bid document. The GeM portal is used only as a platform for holding the bid in the form of service provider. Rejection of bid of the petitioner on the ground that the petitioner’s account has been suspended by the GeM portal is per se illegal and arbitrary. Therefore, the present petition has been filed for setting aside the decision taken by the respondent No.1.

4. It is argued at length drawing attention of this Court to Clause 13 of the tender document wherein it is clearly mentioned that the GeM portal is used only as a platform for procurement/tendering for appointment of service provider for handling rail/road borne cargo at rail side warehouse complex. There is no other terms and conditions of the bid document that has been violated by the petitioner. The bid documents submitted by the petitioner have already been evaluated at the time of opening of the financial bid. The petitioner amongst the five participant was found to be successful bidder and was declared as L1. Therefore, just to accommodate or to extend the benefit to some other candidate, the entire bid has been cancelled.

5. It is pointed out that during the pendency of this petition, new NIT has been floated by the respondent No.1 which was put to challenge by the petitioner by filing an application being I.A. No.17437 of 2023 seeking for quashment of fresh NIT dated 23.8.2023. This Court vide order dated 27.10.2023 has stayed all further proceedings pursuant to the new bid vide Annexure P/6.

6. The counsel for the petitioner has pointed out that the deficiency which has been pointed out by the authorities has been rectified by him immediately and the defects

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