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2022 Supreme(Online)(Chh) 1628

CHHATTISGARH HIGH COURT
Arup Kumar Goswami, J
M/s. Raipur Construction Pvt. Ltd. – Appellant
Versus
Bilaspur Smart City Limited – Respondent
WPC No. 2390/2020 | WPC No. 2396/2020 | WPC No. 2860/2020 | WPC No. 2872/2020 | WPC No. 3150/2020 | WPC No. 3151/2020 | WPC No. 3188/2020 | WPC No. 2897/2020 | WPC No. 2898/2020 | WPC No. 2989/2020



Advocates:
For the Appellants/Petitioners: Shri Manoj Paranjpe, Shri K. Rohan, Shri Bharat Sharma, Shri Rajeev Shrivastava, Shri Ankit Singhal, Shri Om Kukreja
For the Respondents: Shri Chandresh Shrivastava, Shri Prafull N. Bharat, Shri Mateen Siddiqui, Shri Faisal Akhtar

Blacklisting without a show-cause notice is legally unsustainable, emphasizing procedural fairness in public procurement processes.

Headnote:(A) Tendering Process - Cancellation of Tender - Law of Contracts - Administrative Law - Multiple writ petitions challenging cancellation of tenders by a public authority based on alleged suppression of information and lack of notice before blacklisting. (Paras 1, 2, 38, 40, 41, 43)

(B) Fair Process - The court emphasized that blacklisting without a show-cause notice is unsustainable per established legal principles. (Paras 23, 24)

(C) Justification for Disqualification - The disqualification of one petitioner was upheld due to non-compliance with tender specifications. (Paras 10, 38)

Facts of the case:
Petitioners challenged the repeated cancellations of tenders by a public authority. Disqualification of petitioners and blacklisting were questioned, arguing lack of fair opportunity and procedural impropriety.

Findings of Court:
The court upheld the disqualification of one petitioner while ruling that the process leading to blacklisting lacked due process, concluding that actions taken were improper and necessitated corrective measures.

Issues: Whether the repeated tender cancellations were intended to favor a certain contractor, and whether the blacklisting without notice was sustainable.

Ratio Decidendi: The court found that due process was lacking in the blacklisting and emphasized the need for transparency and adherence to tender evaluation processes.

Result: The petitions were partly allowed, reinstating some tender qualifications and setting aside blacklisting orders.

Table of Content
1. overview of tender disputes and considerations (Para 1 , 2)
2. judicial scrutiny of decision making process (Para 3 , 9 , 30 , 35)
3. chronology and consequences of tender cancellations (Para 4 , 6 , 8)
4. disqualifications and allegations against bidders (Para 5 , 10 , 12 , 19 , 26)
5. legal principles on blacklisting and notice requirements (Para 11 , 20 , 22 , 24)
6. final decisions on disqualifications and tenders (Para 29 , 36 , 38)
7. court orders and directions to proceed with tenders (Para 40 , 42 , 43)

1. All these writ petitions are connected together by a common thread of the same texture. The subject matter relates to the tender floated by the Respondent - Bilaspur Smart City Limited. The challenge raised is against cancellation of the Second tender (after cancelling the First tender) and in respect of the subsequent / Third tender proceedings, besides the instance of blacklisting the parties concerned and other incidental aspects.

2. The main points that arise for consideration are:
(a) Whether the repeated cancellation of the tender floated by the Respondent - Bilaspur Smart City Limited is with intent to extend undue favours to anybody of choice of the Respondents?
(b) Whether the blacklisting of the Tenderer ordered by the Respondent - Bilaspur Smart City Limited without issuing any show - cause notice is correct or sustainable in law?
(c) Whether the disqualification of the Petitioner - Company in WPC No. 2390/2020 and WPC No. 2396/2020 (M/s. Raipur Construction Pvt. Ltd.) in the Second round of tender is correct or justified?
(d) Whether the disqualification of the Petitioner in WPC No. 2860/2020 and WPC No. 2872/2020 (M/s. Prakash Asphaltings and Toll Highways (India) Ltd.) in the Second round of tender after declaring them as already qualified and placing them at L1, based on some complaint as to the alleged suppression of the work in hand - to assess the bid capacity, is in order?
(e) Whether blacklisting of the Petitioner in WPC No. 3150/2020 and WPC No. 3151/2020 (same Petitioner Company in WPC No. 2390/2020 and WPC No. 2396/2020) as per order dated 11.11.2020 and the subsequent proceedings dated 24.11.2020 informing that the physical bid of the said Petitioner cannot be opened in the Third round of tender in view of the blacklisting ordered on 11.11.2020 and the further order dated 25.11.2020 rejecting the bid submitted in respect of the Third tender, is correct and justified?
(f) Whether the 'decision making process' pursued by the Respondent - Bilaspur Smart City Limited is transparent and sustainable in law; both with regard to the question of 'disqualification' and the 'blacklisting' of the parties concerned?
(g) Is the version of the Petitioners in WPC No. 3150/2020, WPC No. 3151/2020 (same petitioner in WPC No. 2390 and WPC No. 2396/2020) that the agreement stated as executed between the said Petitioner and the Raipur Smart City Ltd. on 05.08.2020 (with reference to the existing work in hand produced by the Respondent / Bilaspur Smart City Ltd. along with the covering memo) is forged / concocted, or acceptable to be acted upon with reference to the relief sought for?







3. We heard Shri Manoj Paranjpe, Shri K. Rohan and Shri Bharat Sharma, the learned counsel for the Petitioner - Raipur Construction Pvt. Ltd. in WPC Nos. 2390/2020, 2396/2020, 3150/2020 and WPC No. 3151/2020, Shri Rajeev Shrivastava, Shri Ankit Singhal and Shri Om Kukreja for the Petitioner - M/s. Prakash Asphaltings and Toll Highways (India) Ltd. in WPC Nos. 2872/2020, 2860/2020 and 3188/2020, besides Shri Chandresh Shrivastava, the learned Deputy Advocate General for the State, Shri Prafull N. Bharat, Shri Mateen Siddiqui and Shri Faisal Akhtar, Advocates for the Respondent - Bilaspur Smart City Limited.

4. The sequence of events starts from the day when the Respondent - Bilaspur Smart City Ltd. issued a Tender notification dated 09.06.2020 inviting bids for construction of bituminous road and drain works from Arpa River Indira















































































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