Banshidhar Construction Pvt. Ltd. v. Bharat Coking Coal Limited & Others

 

[2024] 10 S.C.R. 425 : 2024 INSC 757

Banshidhar Construction Pvt. Ltd. v. Bharat Coking Coal Limited & Others

(Civil Appeal No. 11005 of 2024) 04 October 2024

[Bela M. Trivedi* and Satish Chandra Sharma, JJ.]

Issue for Consideration

Issue arose whether the respondent was justified in rejecting the

technical bid of the appellant, while accepting the technical bid of

the respondent no. 8-Company, and declaring it to be successful

bidder, though the respondent no. 8 had not complied with the

mandatory requirement of submitting the important documents

relating to the qualification criteria as contained in Clause 10 of

the Notice Inviting Tender-NIT.

Headnotes

Government Contracts – Judicial Intervention – Scope of – Tender for mega project – Respondent no. 1-BCCL, a public sector undertaking floated tender – Appellant participated in the Tender, however, declared to be technically disqualified on the ground that it did not comply with the Clause 10 of NIT, as regards power of attorney for signing of bid – Respondent no. 8 Company declared successful bidder – Aggrieved, appellant filed the writ petition on the ground that the respondent no.8

had not submitted the scanned copies of the Audited balance sheets required to be submitted as per Clause 10 NIT in relation to the financial capacity, while submitting/uploading the tender documents and it was only when clarification was sought from the respondent No.8 about the shortfall of documents, the said Audited balance sheets were submitted after the technical bids were opened – High Court dismissed the writ petition, confirming the decision of the technical bid committee of the respondent rejecting the technical bid of the appellant, while accepting the technical bid of the respondent no. 8 – Challenge to:

Held: Government bodies/instrumentalities are expected to act in

absolutely fair, reasonable and transparent manner, particularly

in the award of contracts for Mega projects – Any element of

arbitrariness or discrimination may lead to hampering of the entire project which would not be in the public interest – Court does not sit as a Court of Appeal in the matter of award of contracts and it merely reviews the manner in which the decision was made; and that the Government and its instrumentalities must have a freedom of entering into the contracts – However, the decision of the government/instrumentalities must be free from arbitrariness and must not be affected by any bias or actuated by malafides – Right to equality u/Art.14 abhors arbitrariness – Public authorities have to ensure that no bias, favouritism or arbitrariness are shown during the bidding process and that the entire bidding process is carried out in absolutely transparent manner – On facts, the power of attorney was duly executed in favour of the donee, the signatory of the documents, and was duly not arised before its submission along with other important documents required to be submitted as per the NIT by the appellant, before the last date of submission fixed by the respondent – Hence, no legal or justifiable ground to reject the technical bid of the appellant – Action of the respondent in rejecting the technical bid of the appellant on absolutely extraneous ground and accepting the technical bid of the respondent no.8 though submitted in utter non-compliance of the mandatory requirement of Clause 10 NIT, and subsequently calling upon the respondent no.8 to furnish the shortfall of documents after the opening of technical bids of the bidders, totally arbitrary and illegal – Furthermore, it cannot be said that the project being Infrastructure project and also one of the Mega projects, this Court may not interfere more particularly in view of the fact that agreement has already been entered into between the respondent and the Special Purpose Vehicle of respondent no.8 – Impugned decision of the respondent rejecting the technical bid of the appellant and further declaring the respondent no.8 as successful bidder grossly arbitrary, illegal, discriminatory and violative of Art.14, thus, set aside – Any action/process undertaken or agreement entered into pursuant to the said decision also set aside. [Paras 19-21, 29, 30]

[2024] 10 S.C.R. 427

Banshidhar Construction Pvt. Ltd. v. Bharat Coking Coal Limited & Others

Case Law Cited

Sterling Computers Limited v. M/s. M & N Publications Limited

and Others [1993] 1 SCR 81 : (1993) 1 SCC 445; Tata Cellular v. Union of India [1994] Supp. 2 SCR 122 : (1994) 6 SCC 651;

ABL International Limited and Another v. Export Credit Guarantee

Corporation of India Limited and Others (2004) 3 SCC 553; Jagdish Mandal v. State of Orissa and Others [2006] Supp. 10 SCR 606 : (2007) 14 SCC 517; Mihan India Ltd. v. GMR Airports Ltd. and Others

[2022] 19 SCR 523 : (2022) SCC Online SC 574; Central Coalfields Limited and Another v. SLL-SML (Joint Venture Consortium) and Others [2016] 4 SCR 890 : (2016) 8 SCC 622 – referred to.

List of Acts

Power of Attorney Act, 1882.

List of Keywords

Tender; Technical bid; Successful bidder; Eligibility criteria;

Government Contract; Judicial Intervention; Tender for mega

project; Technically disqualified; Audited balance sheets;

Submitting/uploading tender documents; Technical bid committee;Government bodies/instrumentalities; Award of contracts for Mega projects; Free from arbitrariness, bias or actuated by malafides;Government bodies; Public authorities; Contractual matters; Right to equality; Bidding process; Financial capacity; Audited Annual Reports; Power of Attorney; Opening of technical bids.

Case Arising From

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 11005 of 2024

From the Judgment and Order dated 18.07.2024 of the High Court of Jharkhand at Ranchi in WPC No. 2896 of 2024

Appearances for Parties

Ravi Shankar Prasad, Naviniti Singh, Sr. Advs., Pankaj Bhagat, Advs. for the Appellants.

Tushar Mehta, Solicitor General, Vikramjit Banerjee, A.S.G., Balbir

Singh, Anupam Lal Das, Sr. Advs., Ankur Kashyap, Amit Sharma, Advs. for the Respondents.