JUDGMENT DR. ARIJIT PASAYAT, J.

1. Leave granted.

2. Challenge in this appeal is to the judgment of a Division Bench of the Delhi High Court dismissing the writ petition filed by the appellants. In the writ petition they had inter alia prayed for issuance of directions to the respondents 1 and 2 to award the contract in respect of tender No. DRTS/AREN/Jan-2005 floated by Bharat Electronics Limited-respondent No. 2 on behalf of Union of India-respondent No. 1 in favour of appellant No.1. They further prayed for directions to restrain respondents 1 and 2 from negotiating with any other bidder except appellant No.1 on the ground that it is the lowest bidder of the said tender.

3. The factual position in a nutshell is as follows.

3.1. Respondent No. 2, Bharat Electronics Ltd. was nominated by respondent No. 1, Ministry of Defence, Government of India, as the prime contractor for Indian Armys modernization plan for Technical Communication System (in short the `TCS). Respondent No. 2 floated a Request for Proposal (RFP) for procurement of Digital Radio Trunking System (in short the `DRTS), also popularly known as Terrestrial Trunked Radio (in short the `TETRA) which is a major component in the TCS Programme of the Indian Army, vide Tender No. DRTS/AREN/Jan-2005. In the RFP floated by respondent No. 2 for the DRTS, the vendors were called upon to make firm technical and commercial proposals for the supply and transfer of technology of DRTS to respondent No. 2 for incorporating in their solution to Indian Army. It was specified that the commercial offers should be for quantities of 80 systems as per Bill of Material enclosed with RFP.

3.2. The technical specifications detailed the components of the DRTS by splitting them into 9 sub-systems. The tender also stipulated that the licensed manufacture of DRTS shall be undertaken by respondent No. 2 through a Transfer of Technology (in short the `ToT) for both hardware and software by executing a ToT Agreement between the vendor and respondent No. 2.

3.3 In terms of the tender document, the evaluation, trials and completion of the contract was proposed to be carried out in five phases spread over a period of time. Phase-I comprised a Preliminary Evaluation of Vendor Proposal and technical analysis, including presentations to be made by the vendors as also clarifications to be provided on questions raised during the presentations and subsequent analysis to the Technical Evaluation Committee (in short the `TEC) for being shortlisted for the Phase-II evaluations. Phase-II evaluations comprised the visits of the empowered technical team to assess the vendor system at the vendor premises to assess the technical capability, encryption, implementation, confirmation of essential parameters and suitability of equipment as per RFP, demonstration of system capability, mock up installation at the location of the vendors and vendors found qualified by the above criteria were to be shortlisted for Phase-III evaluation.

3.4 Phase-III evaluation required the vendors to offer three systems for user trials; one of them was to be installed in a shelter provided by respondent No. 2, which was to be followed by user trials to be conducted by an evaluation team from the Indian Army. The vendors were also required to give a written undertaking that their systems will meet all the requirements of technical and environmental evaluations, maintainability evaluation trials etc. to be conducted in Phase-V.

3.5 Phase-IV comprised opening of the commercial offers of such of the vendors whose systems were shortlisted after Phase-III by a Committee in the presence of the tenderers and further negotiations were to be made only with the lowest bidder (L1) as determined by the Committee. Final Phase-V came into play after placement of order when the successful tenderer was required to supply the three systems.

3.6 On 8th February, 2005, a pre-bid meeting was held by respondent No. 2 where the prospective bidders were apprise