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2024 Supreme(Telangana) 312

IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD
SUREPALLI NANDA, J.
M/s. Annapurna Constructions – Petitioner
Versus
Union of India Rep. by its Principal Secretary, New Delhi and Others – Respondents
W.P. No. 34806 of 2023
Decided On : 15-04-2024

Advocates:
Advocate Appeared:
For the Petitioner: Indus Law Firm.
For the Respondents: Gadi Praveen Kumar, G. Chandra Mohan.

IMPORTANT POINT
Public authorities must ensure fairness and non-arbitrariness in tender processes, adhering to established eligibility criteria.

Headnote:

Tender - Disqualification of Bid - Indian Railway Standard General Conditions of Contract April 2022 - The court found the disqualification of the petitioner’s bid arbitrary and unjustified, emphasizing the need for fair treatment in public contracts as per Articles 14, 19(1)(g), and 21 of the Constitution.

Fact of the Case:

The petitioner, a construction firm, submitted a tender for railway infrastructure work and was declared the lowest eligible bidder. However, the respondent disqualified the bid citing failure to meet technical eligibility criteria, leading the petitioner to challenge this decision in court.

Finding of the Court:

The court found that the petitioner met the eligibility criteria as per the tender conditions and the Indian Railway Standard General Conditions of Contract. The disqualification was deemed arbitrary and intended to favor another bidder.

Issues: Whether the petitioner satisfied the technical eligibility criteria for the tender and if the disqualification was arbitrary and unjustified.

Ratio Decidendi: The court held that public authorities must act fairly and without discrimination in tender processes, and the petitioner was entitled to relief as the disqualification was arbitrary.

Result: The writ petition is allowed, directing the respondents to accept the petitioner's tender.

ORDER :

1. Heard Mr.N.V.Sumanth (M/s.Indus Law Firm), learned counsel appearing on behalf of the petitioner, Mr.Gadi Praveen Kumar, learned Deputy Solicitor General of India, appearing on behalf of respondent Nos.1 to 4, and Mr.G.Chandra Mohan, learned counsel appearing on behalf of respondent No. 5.

2. The Petitioner approached the Court seeking prayer as under:

    “…to issue a writ, order or direction more particularly one in the nature of WRIT OF MANDAMUS, declaring the action of the Respondents in disqualifying the petitioner’s bid in respect of Tender No. T-202324-2-077 dated 19.10.2023 issued by the 4th respondent as illegal, arbitrary, malafide, violative of IRSGCC April, 2022 and the conditions of tender document as well as Articles 14, 19(1)(g) & 21 of the Constitution of India and to consequently direct the respondents to accept the petitioner’s tender/bid as being eligible in all respects and to allot the tender work to the petitioner...”

3. The case of the Petitioner, in brief, as per the averments made in the affidavit filed in support of the present writ petition:

    (a) The Petitioner firm was founded in the year 1997 and is specialized mainly in building Railway Infrastructure and other related civil works. In response to the tender invitation put-forth by the 4th Respondent for the improvement/development of Station building, toilets, facade, circulating area etc., at WHM station, SW II and for providing minimum essential amenities and facilities for Divyangjan at WHM station vide Notice inviting Tender No. T-202324-2-077 the Petitioner firm submitted its tender on 09.11.2023 duly enclosing all the essential experience certificates and other documents required for satisfactorily complying with the qualification criteria as provided for under the above tender notice as well as the prevailing Indian Railway Standard General Conditions of Contract. The bids were opened on 09.11.2023 and the Petitioner was declared as “Lowest Eligible Bidder” by the 4th Respondent on the same day and the same was notified under the heading “Tabulation Statement of Financial Bids” on Respondents Website. Despite the same, the 4th Respondent did not issue Letter of Acceptance to the Petitioner which in the normal course would have been the right thing to do.

(b) It is further the case of the Petitioner that upon enquiry the Petitioner was informed that the Petitioner’s bid could not be accepted as the Petitioner did not satisfy the technical eligibility criteria which is extracted as under:

“The tenderer must have successfully completed or substantially completed any of the following during last 07 (seven) years, ending last day of month previous to the one in which tender is invited: Three similar works each costing not less than the amount equal to 30% of advertised value of the tender, or Two similar works each costing not less than the amount equal to 40% of advertised value of the tender, or One similar work each costing not less than the amount equal to 60% of advertised value of the tender. (b) (i) In case of composite works (e.g. works involving more than one distinct component, such as Civil Engineering works, S&T works, Electrical works, OHE works etc. and in the case of major bridges - substructure, superstructure etc.), tenderer must have successfully completed or substantially completed any of the following during last 07 (seven) years, ending last day of month previous to the one in which tender is invited: Three similar works each costing not less than the amount equal to 30% of advertised value of each component of tender, or Two similar works each costing not less than the amount equal to 40% of advertised value of each component of tender, or One similar work each costing not less than the amount equal to 60% of advertised value of each component of tender.”

(c) It is further the case of the Petitioner that the Petitioner submitted three separate experience certificates dated 08.11.2023, 10.05.2023, 02.06.2023 which clearly indi

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