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IN THE HIGH COURT OF FOR THE STATE OF TELANGANA
A. ABHISHEK REDDY, J.
COMT Constructions Pvt. Ltd. – Appellant
Versus
State of Telangana and Others – Respondents
Writ Petition No. 21165 of 2020
Decided On : 07-01-2021
Tender Conditions - Eligibility Criteria - G.O.Ms. No. 94, I and CAD (PW-COD) Department dated 01.07.2013, Circular No. 12-02-1-CTE-6 dated 17.12.2002 of the Central Vigilance Commission (CVC) - The court dismissed the writ petition challenging the tender conditions, stating that the eligibility criterion stipulated in the tender document is not arbitrary, unreasonable, capricious, mala-fide, biased, or tailor-made to suit a few persons or firms. The authorities have the right to stipulate conditions to ensure that participating tenderers have the required experience and financial capacity to execute large projects within a time-bound period.
Fact of the Case:
The petitioner challenged the impugned tender conditions, alleging that they were irrational, onerous, and violated the constitution. The petitioner raised objections to the eligibility criteria in the tender notification, claiming that they were contrary to G.O.Ms. No. 94, dated 01.07.2013, and the guidelines issued by the Central Vigilance Commission (CVC). The respondents argued that the Corporation is competent to prepare eligibility criteria and that the conditions were necessary to invite competent and major contractors with good experience in construction of multi-storied buildings to complete the township project within a short period.
Finding of the Court:
The court found that the writ petition failed on the ground that it lacked details regarding the petitioner's capacity, experience, and financial capacity to participate in the tender process or undertake the tender works. The court noted that the petitioner did not provide any documents or details to support its claim that the tender conditions were onerous and tailor-made to suit specific contractors. The court also observed that the eligibility criterion stipulated in the tender document was not arbitrary, unreasonable, or biased.
Issues: The main issue was whether the impugned tender conditions were irrational, onerous, and contrary to the government guidelines and whether the petitioner had the necessary capacity and experience to participate in the tender process.
Ratio Decidendi: The court held that the authorities have the right to stipulate conditions to ensure that participating tenderers have the required experience and financial capacity to execute large projects within a time-bound period. The court emphasized that the eligibility criterion stipulated in the tender document was not arbitrary, unreasonable, capricious, mala-fide, biased, or tailor-made to suit a few persons or firms.
Final Decision: The writ petition was dismissed, and the miscellaneous petitions pending, if any, were closed with no order as to costs.
ORDER :
1. Heard the learned counsel for the petitioner, the learned Government Pleader for Energy for respondent No. 1 and Ms. A. Deepthi, the learned Standing Counsel for Telangana State Power Generation Corporation Limited, for respondent Nos. 2 and 3. With their consent, the Writ Petition is disposed of at the stage of admission itself.
2. The present Writ Petition is filed seeking the following relief:
3. The facts of the case, in a nutshell, are that the third respondent issued the impugned tender notification dated 03.11.2020, to which the petitioner raised objections, vide representation dated 13.11.2020, duly highlighting the irrational/onerous conditions included in the eligibility criteria mentioned in the said notification, in the ‘Pre Bid Meeting’ held on 16.11.2020 at the office of the third respondent. The grievance of the petitioner is that without responding to the said representation, the respondents are proceeding with the tender process and aggrieved by the same, the present Writ Petition is filed.
4. A counter affidavit has been filed by respondent No. 1 stating that TSGENCO is competent to prepare eligibility criteria and to change the tender procedures as per the site requirement in order to suit the commissioning schedule of the respective projects. The eligibility criteria is prepared and specified in the tender notice in order to invite competent and major contractors who are having good experience in construction of multi-storied buildings so as to complete the township in a short period of two years. It is further stated that the Central Vigilance Commission (CVC) guidelines are not applicable to TSGENCO and they are applicable only to the Central Government departments and its undertakings. TSGENCO is guided by its Purchase Manual. It is further averred that the relief claimed in the writ petition can be granted only against respondent Nos. 2 and 3 and the respondent No. 1 is only a formal party to the writ petition. Therefore, it is prayed to dismiss the writ petition against respondent No. 1.
5. Another counter affidavit has been filed on behalf of second and third respondents stating that pursuant to the queries/clarifications received from the prospective bidders including the petitioner in the Pre-Bid meeting held on 16.11.2020, the tender dates were extended. While making a note of the tender schedule, it is further stated in the counter affidavit that the petitioner has not attended in the Pre-Bid meeting held on 16.11.2020, but has raised certain queries vide letter dated 13.11.2020, to which necessary replies were communicated to the petitioner through e-mail on 25.11.2020. It is further stated that taking the magnitude of the financial and physical nature of work to be executed within the stipulated time, the Corporation has finalized the eligibility criteria. The contention of the petitioner that the eligibility criteria specified in the tender notification runs contrary to G.O.Ms. No. 94, dated 01.07.2013 is incorrect for the reason that the said GO by itself does not indicate the extent
The main legal point established in the judgment is the limitation of judicial review in tender matters, the need for commercial prudence in evaluating tenders, and the importance of fairness and non....
The formulation of tender conditions falls within the administrative domain of the authority, and judicial review is limited to preventing arbitrariness or favoritism. The courts cannot interfere wit....
Judicial review of tender conditions is limited; courts should not interfere unless actions are arbitrary, discriminatory, or mala fide, ensuring public interest is prioritized.
Eligibility for contracting: To foster competition, firms and individuals to offer goods, work, and services required for the program, any conditions for participation shall be limited to those that ....
Judicial review of tenders limited to arbitrariness or malafide; eligibility conditions upheld if public interest served with multiple qualified bidders; bid time reduction valid with approval; ineli....
The court affirmed that stringent eligibility criteria in public tender processes cannot violate statutory relaxations for Start-ups, emphasizing limited grounds for judicial review.
Public authorities must ensure fairness and non-arbitrariness in tender processes, adhering to established eligibility criteria.
Point of law: powers of judicial review are limited and while exercising such power the Court has to see whether the process adopted or decision made by the authority is malafideor is intended to fav....
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