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2022 Supreme(Manipur) 29

IN THE HIGH COURT OF MANIPUR AT IMPHAL
Sanjay Kumar, M.V. Muralidaran, JJ.
Devendra Construction Company - Appellant
Versus
State Of Manipur & Ors. - Respondents
Writ Appeal No. 66 of 2021 with MC (WA) No. 119 of 2021
Decided On : 10-03-2022

Advocates appeared:
Mr.Om Prakash Mehta, Advocate, with Mr.R.K.Kulajit, Mr.Prateek Gattali & Mr.Phalgun Buch, Advocates, for the Appellant; Mr.N.Kumarjit, Advocate General, Manipur, for the Respondent Nos.1 & 2; Mr.H.S.Paonam, Sr.Advocate & Mr.S.Gunabanta, Advocate, for the Respondent No.3

Headnote:(A) Public Procurement - Tendering process - Due process and compliance with eligibility criteria outlined in the Tender Document are essential for ensuring fair competition. - The rejection of the bid of an appellant due to hyper-technical grounds undermines the principles of competitive bidding and public interest. (Paras 27, 31)

Facts of the case:
The appellant, a partnership firm, participated in a tender for a water supply project in Manipur but was disqualified based on errors in their submitted financial documents. The other bidders included two technically qualified firms, one of which was awarded the contract while the appellant sought judicial review. (Paras 2, 4)

Findings of Court:
The court found the rejection of the appellant's bid and the subsequent award of a contract to another firm were unjustifiably made, failing to adhere to the fair play principle. (Paras 26, 32)

Issues: The court addressed whether the rejection of the appellant’s bid was justified and if the tendering process upheld transparency and fairness. (Para 10)

Ratio Decidendi: The court concluded that strict adherence to minor procedural issues cannot outweigh the need for fairness and competition in public contracts, and the tendering authority must provide bidders with opportunities to rectify minor discrepancies. (Paras 27, 32)

Result: The appeal is allowed, and the decision to award the contract is set aside for reevaluation in accordance with the principles set forth. (Paras 32)

Table of Content
1. establishment of water supply project. (Para 1)
2. rejection of tender and appeals process. (Para 2 , 3 , 4)
3. urgency and procedural constraints. (Para 5 , 6)
4. scope of appeal and required compliance. (Para 7 , 8)
5. judicial principles in tender evaluation. (Para 9 , 10 , 27)
6. evaluation criteria compliance and clarification rights. (Para 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26)
7. public interest in procurement efficiency. (Para 28 , 29 , 30 , 31)
8. reconsideration of eligibility and bid evaluation. (Para 32)

JUDGMENT

Sanjay Kumar, CJ. - The Department of Drinking Water and Sanitation, Ministry of Jal Shakti, Government of India, launched the 'Jal Jeevan Mission' to provide functional water-tap connections to every household in the country by the year 2024. In turn, the State of Manipur undertook the Manipur Water Supply Project at a projected cost of Rs.3064.58 Crore with the aid and assistance of the New Development Bank (NDB), a bank established by the BRICS nations at Shanghai, China. The State of Manipur aims at establishing an Integrated Water Supply Project for Imphal Planning Area Phase-3 and supply of drinking water to 25 towns and to 1731 habitations in the rural areas of Manipur.

As recommended by the NDB and in order to attract international competitive bidding, the project was divided into 14 procurement packages. One such procurement package is the Manipur Water Supply Project [SH: Providing Drinking Water Supply to other Towns (13 nos.) - Works Package: OTP P-VI (W)]. Invitation for bids for this package was issued by the Public Health Engineering Department (PHED), Government of Manipur, under NIT No.CE/PHE/3-94/NDB(W)/P-VI/2020/4013 dated 27.02.2021. The NIT discloses that the approximate value of the work was Rs.168.36 Crore and the period for completion was projected as two and a half years after the date of issue of the work order. The NIT also provided that the bids for the work were to be submitted in a two-bid system, viz., a technical bid and a financial bid, on a turn-key basis by reputed firms/contractors incorporated in any of the member countries of the NDB.

2. M/s. Devendra Construction Company, Jodhpur, the appellant partnership firm, and M/s. Keystone Infra Private Ltd., Hyderabad, the third respondent company, along with four other concerns, participated in the tender process in relation to this package. However, the appellant firm's tender was rejected at the threshold vide e-mail dated 24.09.2021. It was stated therein that its technical bid had been rejected during the technical evaluation by the duly constituted Committee for the reason - 'technically not qualified'. Aggrieved thereby, the appellant firm approached this Court by way of W.P(C) No.672 of 2021. Its prayer therein was to direct the authorities of the PHED, Government of Manipur, to provide reasons for rejection of its technical bid vide e-mail dated 24.09.2021; to provide it reasonable time to file a reply; to direct the said authorities to pass a speaking order after considering the reply and the representation filed by it, in case the decision to reject its bid still continued to hold the field; to direct the said authorities to open its financial bid in case they withdrew the e-mail dated 24.09.2021 and to allot the work to it in case its bid was the lowest amongst all the bidders; to grant liberty to it to challenge the speaking order passed by the authorities within ten working days from its communication, in case the decision to reject its bid continued and to direct the authorities not to finalize the bid till then; and to award costs. The appellant firm also sought interim relief by staying the finalization of the bid till disposal of the writ petition. An interim order to that effect was granted on 05.10.2021.

3. However, by Judgment and Order dated 29.10.2021, a learned Judge of this Court dismissed the writ petition and vacated the interim order. On the very same d

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