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2024 Supreme(Online)(AP) 22936

HIGH COURT OF ANDHRA PRADESH
VENKATESWARLU NIMMAGADDA, J
Deccan Electricals Pvt Ltd – Appellant
Versus
The State Of Ap and Others – Respondent
Writ Petition No: 30115/2024



Advocates:
For the Appellants/Petitioners: M/S Indus Law Firm
For the Respondents: GP For Energy, V V Satish (SC for APEPDCL)

Judicial intervention in tender processes should prioritize public interest over minor deviations from contractual terms, ensuring transparency and fairness.

Headnote:(A) Constitution of India - Articles 14 and 21 - Writ petition filed challenging acceptance of bids by state authority, alleging violation of pre-qualification criteria specified in tender documents. Court emphasized adherence to tender conditions to maintain transparency and avoid favoritism in public procurement. (Paras 1-10)

(B) Tender Process - Holding that minor deviations from ancillary conditions do not warrant judicial interference when public interest and exchequer are at stake. The court identified the need for a balance between strict compliance with tender documents and considerations of public benefit. (Paras 11-14)

Facts of the case:
The petitioner, a small-scale industry, challenged the decision of the state authority for accepting a bid of a competing firm, asserting that it failed to meet essential technical criteria as outlined in tender documents.

Findings of Court:
The Court found no merit in the petitioner's challenge due to minor discrepancies noted in the bidding process, ruling in favor of maintaining public interest and ensuring the validity of the awarded contract.

Issues: The main issues addressed included the legitimacy of the bidding process and whether deviations from pre-qualification criteria justified annulment of the awarded tender.

Ratio Decidendi: The court ruled that adherence to tender conditions is paramount for public trust, and minor irregularities in ancillary criteria do not invalidate the tender process when public interests are served.

Result: Writ Petition is dismissed.

Table of Content
1. petition filed challenging bid acceptance based on alleged non-compliance with tender criteria. (Para 1 , 2)
2. arguments relating to technical adherence to specified tests. (Para 3 , 4)
3. court addresses legitimacy of tender conditions versus public interest. (Para 8 , 9)
4. judicial restraint emphasized with respect to tender decisions. (Para 11 , 12)

ORDER:

This writ petition is filed under Article 226 of the Constitution of the India aggrieved by the action of the 2nd respondent in accepting the bids submitted by the 4th respondent who does not satisfy the pre- qualification criteria as provided for in the tender document of Tender notice No.EPMPT-35/24-25, dated 30.09.2024 as being illegal, arbitrary and violative of Article 14 and 21 of the Constitution of India .

2. The case of the petitioner is that the petitioner herein is a small scale industry registered as MSME. While so, pursuant to the tender notice bearing No.EPMPT-35/24-25, dated 30.09.2024 inviting for tenders relating to supply of 11KV polymer PIN Insulators with GI PINs on e-procurement basis, the petitioner along with unofficial respondent No.4 herein submitted their tenders along with others. The petitioner stood as L-3 bidder and the 4th respondent stood as L-1 bidder. The claim of the petitioner herein is that even though the 4th respondent does not possess the pre-qualification criteria as per the terms of the tender document, the respondents accepted the bid of the 4th respondent contrary to Articles 14 and 21 of the Constitution of India .

3. Learned counsel for the petitioner submits that Clause 8 of the tender document provides the tests and standards required to be pass. As per Clause 8, the tenderer/manufacturer has to submit certain test reports i.e., design test and type test. Clause 8.1., speaks about design test, the test should be as per IEC-61109. Except the said test, any other tests which may be similar cannot be accepted, since the same is contrary to Clause 8.1. & 8.2. of the tender document. The design test includes hardness test, tracking and erosion test and guaranteed technical particulars. Even though, the 4th respondent unable to produce these tests as per IEC-61109 and submitted under ASTMD-2240 and the same was accepted, contrary to clause 8 of the tender. Therefore, the bid of the 4th respondent is liable to be rejected. For which, the petitioner relied upon the judgments rendered by the Hon’ble Apex Court in two cases i.e., i) W.B. State Electricity Board vs. Patel Engineering Co. Ltd. And Others, [(2001) 2 Supreme Court Cases 451]; & ii) Central Coalfields Limited and another vs. SLL-SML (Joint venture consortium) and others, [(2016) 8 Supreme Court cases 622]

i) W.B. State Electricity Board vs. Patel Engineering Co. Ltd. And Others, wherein it is held as follows:

“24. The controversy in this case has arisen at the threshold. It cannot be disputed that this is an international competitive bidding which postulates keen competition and high efficiency. The bidders have or should have assistance of technical experts. The degree of care required in such a bidding is greater than in ordinary local bids for small works. It is essential to maintain the sanctity and integrity of process of tender/bid and also award of a contract. The appellant, respondent Nos.1 to 4 and respondent Nos.10 and 11 are all bound by the ITB which should be complied with scrupulously. In a work of this nature and magnitude where bidders who fulfil prequalification alone are invited to bid, adherence to the instructions cannot be given a go-by by branding it as a pedantic approach, otherwise it will encourage and provide scope for discrimination, arbitrariness and favouritism which are totally opposed to the rule of law and our constitutional values. The very purpose of issuing rules/instructions is to ensure their enforcement lest the rule of law should be a casualty. Relaxation or waiver of a rule or condition, unless so provided under the IT

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