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2004 Supreme(Online)(Chh) 11

CHATTISGARH HIGH COURT
Mr. Kishore Bhaduri, J, Dr. N.K. Shukla, ACJ
Mecgale Pneumatics v. Bhilai Electrical Supply Company Ltd. and Another
Writ Petition



Advocates:
For the Appellants/Petitioners: Mr. Kishore Bhaduri
For the Respondents: Dr. N.K. Shukla

Eligibility criteria in tender processes must ensure fairness and cannot be deemed arbitrary without sufficient evidence to demonstrate biases or unreasonable standards.

Headnote:(A) Constitution of India - Article 226/227 - Writ petition challenging eligibility criteria in tendering process - The petitioner alleges that the criteria set by respondents for qualification were arbitrary and designed to exclude them. Court emphasizes that a fair and just public process must be upheld. - The principles governing judicial review of administrative actions were discussed, citing decisions concluding that the burden lies on the petitioner to prove arbitrariness. - The court found that the criteria were reasonable based on the total contract value and experience required for execution of works. (Paras 1, 2, 4, 8, 10, 12, 13)

(B) Administrative Law - Judicial Review - The right of the state to set eligibility criteria must be respected unless arbitrariness is proven - Courts will not intervene in the wisdom of administrative decisions unless there is a clear violation of principles of natural justice or an abuse of power. (Paras 7, 10, 11)

Table of Content
1. writ petition regarding tender eligibility raised by a registered firm. (Para 1 , 2)
2. respondents defend eligibility criteria based on fairness and industry norms. (Para 3 , 4 , 5 , 6)
3. judicial review principles regarding state actions and contractual powers. (Para 7 , 8 , 9)
4. assessment of arbitrariness in the context of the eligibility criteria. (Para 10 , 11)
5. court's decision to dismiss the writ petition reaffirming the validity of the respondents' criteria. (Para 12 , 13)

1. By this writ petition filed under Art.226/227 of the Constitution of India the petitioner, a registered Partnership Firm registered under the Indian Partnership Act under Registration No. NGP / 1441/90-91 and engaged in the work of manufacturing, supplying, marketing and distribution of materials for civil, mechanical and constructions, has challenged the decision and action of the respondents for inviting a tender for supply and installation of scraper conveyer and clinker venture for disposal of ash in the Thermal Power Plant through a Tender Document (Annexure P / 3).

2. The main challenge in this writ petition is Clause (B) of the Qualifying Requirements by which the respondents among others has fixed the eligibility criteria for a tenderer that "the bidder must have executed a single contract of value not less than Rs. 72.00 Lakhs for supply and installation of scroper conveyer of capacity not less than 4 ton per hour each and clinker grinder of capacity not less than 10 ton per hour each, for boiler having capacity 50 MW or more during last five years preceding the date of NIT (Notice Inviting Tender)". The contention of the petitioner / Firm is that this qualifying requirement is arbitrary, unilateral and have been initially put to place the petitioner out of the run. It has been mentioned in the petition that the petitioner / Firm is engaged in manufacturing the conveyer system, ash handling system, lime cutting system, water treatment system and also affluent treatment system accessories. The petitioner has annual turnover Rs. 1,59,48,723/- and has till date supplied the materials to all measure companies. The list showing the measure areas executed by the petitioner has been filed in the petition marked as Annexure P / 5. The petitioner qualified in every count and accordingly submitted the document. The only non - qualifying condition so put for by the respondents was execution of single contract worth more than Rs. 72/- lakhs. The petitioner / Firm declares that the petitioner has executed many contracts worth more than Rs. 45/- lakhs. The respondent so as to oust the petitioner of the competition has initially put this clause of executing single contract worth Rs. 72.00 Lakhs. Putting of such clause is not only unfair but is also arbitrary, unreasonable and does not come within the act for public good or under public interest. The intention of the respondent is writ large by such clause and therefore the said act is violative of the principles of equal opportunity and amounting abuse of power by putting the clause. The respondent authorities have committed a breach of rules of natural justice and thus reached to a conclusion of putting such clause without any justification, therefore, the same amounts to abuse of its power. The petitioner has sought for a relief that the clause so far as it relates to the execution of single contract worth Rs. 72.00 Lakhs be quashed.

3. The return has been filed on behalf of the respondents. It is submitted that apart from the petitioner, nine other contractors made requests for issuance of the tender form. Out of these nine requests, three requests were turned down on the ground that they are not fulfilling the qualifying requirements. The request of other two contractors including the petitioner was allowed and tender form was issued with a specific stipulation that they will submit the papers pertaining to the qualifying requirements before ten days from the date of opening of the

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