Royal Westin Projects LLP Through Director Nilesh Dadabhau Raut vs. The State Of Maharashtra Through Ministry Of Urban Development And Others

Held

The Court held that both petitions were devoid of substance and dismissed them. The Court found no arbitrary use of discretion by the respondent Corporation in accepting the offer of Respondent No. 6. The petitioner failed to prove that its disqualification in the technical bid evaluation was arbitrary or a flagrant abuse of statutory or constitutional provisions. The Court referred to the principles laid down by the Supreme Court in Jagdish Mandal and N.G. Projects Limited regarding the scope of judicial review in tender matters, emphasizing that courts should refrain from imposing their decisions over the employer's decision, especially in technical and commercial matters, unless clear arbitrariness, irrationality, mala fides, or bias is established. The Court noted that the facts of the petitioner's cited case, Banshidhar Constructions Pvt. Ltd., were distinguishable. The Court also relied on the principles from Tata Motors Limited, cautioning against interference in contractual matters without a clear case of arbitrariness or mala fides, and advocating for "fair play in the joints" for government undertakings. The Court found no basis to interfere with the tender process, which it deemed to have been conducted transparently.

Facts

The petitions challenge the technical evaluation and selection of Respondent No. 6 as the lowest bidder (L-1) in a tender process for the disposal of legacy waste by bio-remediation and bio-mining, undertaken by Respondent No. 1, the Chhatrapati Sambhajinagar Municipal Corporation. The petitioner, Vistacore Infraprojects Pvt. Ltd., failed the technical bid, while Respondent No. 6 and Respondent No. 3 qualified. Respondent No. 6 was issued a letter of intent and subsequently a work order. The petitioner alleged arbitrary evaluation, violation of tender procedures, lack of essential qualifications for Respondent No. 6, and bias by the tendering authority, leading to a potential loss to the public exchequer. The Corporation and Respondent No. 6 contested these claims, asserting adherence to tender conditions and due process.

Key Issues

1. Whether the technical evaluation and selection of Respondent No. 6 were arbitrary and in violation of the Request for Proposal (RFP) terms, specifically Clause 11.3 and 31, concerning the opening of technical and financial bids on the same day and the petitioner's alleged requisite qualifications (Clause 3 and 2.6 of RFP)? 2. Whether Respondent No. 6 lacked essential qualifications and misled the tendering authority regarding its bid capacity, and whether the tendering authority was biased in favour of Respondent No. 6, as alleged by the petitioner? 3. Whether the tender process was vitiated, causing loss to the public exchequer, and if the Court should interfere in contractual matters involving technical issues? Petitioner's arguments: The technical evaluation was arbitrary and against the RFP procedure. Technical and financial bids were opened on the same day, violating Clause 11.3 and 31. The petitioner possessed the required qualifications but was rejected unfairly. Respondent No. 6 lacked essential qualifications and misrepresented its bid capacity. The tendering authority was biased, leading to a discrepancy between the quoted rate and the awarded work value, causing public loss. Reliance was placed on Banshidhar Constructions Pvt. Ltd. and Union of India vs. Dinesh Engineering Corporation. Respondents' arguments: The terms and conditions were approved by the Central Government and strictly followed. No favoritism or bias existed, and due procedure was followed. Shortfalls were communicated, and the petitioner failed to submit required documents as per Clause 11.3. The work order has been issued, and work has commenced, making interference difficult and against public interest. Reliance was placed on various Supreme Court judgments including Balaji Ventures Pvt. Ltd., Montecarlo Limited, Michigan Rubber (India) Ltd., Tata Cellular, and JSW Infrastructure Limited.