Vistacore Infraprojects PVT LTD Through Its Authorised Representative Hemchandra Arun Patil vs. Chhatrapati Sambhajinagar Municipal Corporation Through Its Deputy Commissioner And Others

Held

The Court held that both petitions were devoid of substance and dismissed them. Regarding the first issue, the Court found no arbitrary use of discretion by the respondent Corporation in accepting the offer of respondent no. 6, and 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 relied on Supreme Court judgments like Jagdish Mandal and N.G. Projects Limited, emphasizing restraint in judicial review of tender processes, especially concerning technical issues, and stated that courts should not interfere unless there is clear arbitrariness, irrationality, mala fides, or bias. The Court found the facts distinguishable from the Supreme Court judgment in Banshidhar Constructions Pvt. Ltd. and Union of India vs. Dinesh Engineering Corporation. The Court also noted that the work order had already been issued and work had commenced, making it difficult to halt the process without causing further loss to the public exchequer. The Court reiterated the principle of giving 'fair play in the joints' to government and public sector undertakings in contractual matters, as laid down in Tata Motors Limited.

Facts

The petitions challenge the technical evaluation of bids and the subsequent issuance of a letter of intent and work order by the Chhatrapati Sambhajinagar Municipal Corporation for the disposal of legacy waste. The petitioner, Vistacore Infraprojects Pvt. Ltd., failed the technical evaluation, while respondent no. 6, GNI Infra-CD Transport (JV), was declared the lowest bidder (L-1) and awarded the work. The petitioner alleged arbitrary evaluation, violation of tender procedures, lack of essential qualifications in respondent no. 6, and bias by the tendering authority, leading to a potential loss to the public exchequer. The Municipal 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) procedures, specifically Clauses 11.3 and 31, as argued by the petitioner? The petitioner contended that technical and financial bids were opened on the same day, their bid was rejected highhandedly despite possessing requisite qualifications, and respondent no. 6 lacked essential qualifications and misled the authority. The respondents argued that terms were approved by the Central Government, due procedure was followed, and the petitioner failed to submit required documents as per Clause 11.3 of the RFP. 2. Whether respondent no. 6 possessed the essential qualifications for the tender, as alleged by the petitioner? The petitioner claimed respondent no. 6 misled the tendering authority regarding its bid capacity. The respondents refuted this, referencing Clauses 3 and 2.6 of the RFP and stating shortfalls were communicated and responded to. 3. Whether the tendering authority was biased and favored respondent no. 6, leading to a vitiated tender process and loss to the public exchequer? The petitioner alleged the awarded value differed from the quoted rate. The respondents denied favoritism and bias, asserting a transparent process.