Law, Judgments & Legal Insights.

Bombay High Court Quashes CIDCO's Rejection of Infra JV 's Bids for NAINA Project, Cites Arbitrariness

Mumbai, Maharashtra – The Bombay High Court, in a significant ruling, has quashed the decision of the City and Industrial Development Corporation of Maharashtra Ltd. (CIDCO) to reject the technical bids of Thakur Infraprojects Pvt. Ltd. (TIPL), acting for the Thakur-EVRASCON Joint Venture ( JV ), for two major infrastructure development tenders related to the Navi Mumbai Airport Influence Notified Area (NAINA) project. The Division Bench, comprising Chief Justice Alok Aradhe and Justice M.S. Karnik , found the rejection arbitrary, irrational, and the decision-making process vitiated.

The judgment, pronounced on May 6, 2025, also set aside the subsequent work order issued to M/s. PNC Aakshya Joint Venture for one tender and the approval of M/s. Ashoka-Aakshya Joint Venture's financial bid for the other. CIDCO has been directed to reconsider the financial bids of the petitioner JV and other eligible bidders afresh.

Case Background

Thakur Infraprojects Pvt. Ltd., as the lead member of a joint venture with M/s. OJSC Euro Asian Construction Corporation ‘EVRASCON’ ( Azerbaijan ), challenged CIDCO's Tender Committee decision dated October 8, 2024. This decision had rejected their bids for: 1. Integrated Infrastructure Development in TPS 10 and 11 (Tender 1, estimated cost ~Rs. 1568.86 Crores). 2. Integrated Infrastructure Development in TPS 8, 9, and 12 (Tender 2, estimated cost ~Rs. 1909 Crores).

The petitioner JV claimed to be the lowest bidder, with a potential saving to the public exchequer of approximately Rs. 182.14 Crores compared to the selected bidders.

Grounds for Rejection and Petitioner's Counter-Arguments

CIDCO's Tender Committee rejected the JV 's bids on five primary grounds:

1. Integrity Pact: Not signed by the foreign JV partner, EVRASCON.

2. Document Stamping/Signing: Mandatory eligibility documents not stamped/signed as required.

3. Foreign Partner Document Certification: EVRASCON's documents were apostilled translations, not certified by both Azerbaijan and the Indian Embassy.

4. Work Experience: Completion certificates allegedly did not include Storm Water Drainage (SWD) and Street Light scope.

5. GST Registration: Foreign JV partner EVRASCON not registered under the GST Act.

The petitioner JV , represented by Senior Advocate C. A. Sundaram , argued: * The Integrity Pact was duly signed by TIPL, which held a Power of Attorney (PoA) from EVRASCON, a practice upheld by the Supreme Court and permissible under tender clauses. * Documents were digitally signed as per the Information Technology Act, 2000. * Apostille d documents from Azerbaijan (a Hague Convention signatory) are valid in India and require no further legalization, as per Ministry of External Affairs guidelines. * An addendum certificate from the Azerbaijan government, also apostilled, confirmed EVRASCON's experience in SWD and street light works. * An undertaking regarding EVRASCON's non-requirement for GST registration was submitted as per tender conditions. * The petitioner also highlighted alleged non-compliance by the other bidders (Respondents No. 3 & 4) which CIDCO purportedly overlooked, indicating a discriminatory process.

CIDCO, represented by Senior Advocate Ravi Kadam , maintained: * It was obliged to rigidly enforce tender terms. * The Integrity Pact required signatures from all consortium members. * Apostille was insufficient for the foreign documents under tender terms, and the Hague Convention excluded certain commercial documents.

Court's Analysis and Key Findings

The High Court meticulously examined each ground for rejection:

1. Integrity Pact

The Court found the rejection on this ground arbitrary. It relied on the Supreme Court's decision in Banshidhar Construction Pvt. Ltd. vs. Bharat Coking Coal Limited & Ors. (2024) , where it was held that an integrity pact signed by a PoA holder is valid. The Court noted, "The lead member of JV viz. TIPL in the capacity of power of attorney of EVRASCON has signed the integrity pact...clauses 3(K), (l) and (s) of the subject tenders permit authorization...the action of CIDCO...cannot but has to be held arbitrary and irrational."

2. Stamping and Signing of Documents

The Court observed that the petitioner claimed digital signatures under the Information Technology Act, 2000, and CIDCO's rejection minutes did not state otherwise. Citing Mohinder Singh Gill vs. Election Commission of India (1978) , the Court stated that "public orders, publicly made...cannot be supplemented by fresh reasons." Further, tender Note 1 allowed CIDCO to ask for original documents if there were doubts, which was not done before rejection.

3. Certification of Foreign Partner's Documents

The Court held this ground unsustainable. Azerbaijan is a signatory to the Hague Apostille Convention, 1961. An Office Memorandum from the Ministry of External Affairs (18th Nov 2020) clarifies that "no further attestation or legalization of an apostilled document should be required in India." The Court found CIDCO's interpretation of the Hague Convention (regarding exclusion of commercial documents) to be erroneous, as the convention applies to documents like contracts and PoAs.

4. Work Experience Certificates

The Court deemed the rejection on this ground "factually incorrect and suffers from the vice of non-application of mind." The JV had submitted an apostilled addendum from the Azerbaijan Government certifying EVRASCON's relevant experience.

5. GST Registration

The Court found that the JV had submitted an undertaking as required by Clause 1(iv) of the tender for partners not required to be registered under the GST Act. Therefore, rejection on this ground was also invalid.

The Court also addressed the issue of maintainability, holding that TIPL, as the lead member and PoA holder for EVRASCON, could file the petition on behalf of the JV .

Decision-Making Process Vitiated

The Court concluded that the decision-making process was flawed. It noted the petitioner's argument about a First Information Report (FIR) against a partner of M/s.PNC-Aakshya Joint Venture (Respondent No.3) for alleged irregularities in an integrity pact for a previous tender. The Court stated, "The aforesaid fact had a material bearing on the issue of eligibility of M/s.PNC-Aakshya Joint Venture. Therefore, the decision-making process of CIDCO which led to grant of contracts in favour of respondent Nos.3 and 4 cannot be said to be fair, reasonable or transparent."

Final Directions

The Bombay High Court issued the following directions: 1. The Tender Committee's decision dated October 8, 2024, rejecting the JV ’s technical bids for both tenders, is quashed. 2. The work order dated October 15, 2024, to M/s.PNC Aakshya Joint Venture for Tender No.2 is quashed. 3. The approval of M/s. Ashoka-Aakshya Joint Venture's financial bid for Tender No.1 is quashed. 4. CIDCO is directed to consider the financial bids of the Thakur-EVRASCON JV , PNC-Aakshya Joint Venture, M/s.Ashoka-Aakshya Joint Venture, and other eligible bidders afresh to award the contracts.

The ruling underscores the judiciary's role in ensuring fairness, transparency, and rationality in public procurement processes, especially when significant public funds are involved.