Anjaneya Corporation vs. State Of Gujarat

Facts

The petitioner, Anjaneya Corporation, a manufacturer and supplier of preschool kits, filed a writ petition challenging the bid document (No. GEM/2022/B/1955944) and its corrigendum for the supply of preschool education kits for Anganwadi children in Gujarat. The petitioner argued that the tender conditions, including past performance criteria, requirement for pre-bid samples, 50% bid quantity requirement, and definition of the last three financial years, were arbitrary, unjust, and tailor-made to favor specific participants. The petitioner contended that these conditions, particularly the increased past performance criteria from 10% to 50% and then 80%, and the requirement to supply 50% of the bid quantity, unfairly excluded eligible bidders. The petitioner also raised concerns about the requirement to submit samples prior to bidding, which they claimed was not a standard GeM criterion and was difficult to meet within the bid timeline, especially considering the COVID-19 situation.

Held

The Court held that the petitioner had not made out a case for interference. Citing recent Supreme Court decisions, including M/s. N.G. Projects Limited Vs. M/s. Vinod Kumar Jain and others, Yashwant Sinha and others Vs. Central Bureau of Investigation, and Silppi Constructions Contractors Vs. Union of India and Another, the Court emphasized that courts should exercise restraint when reviewing contractual or commercial matters. The Supreme Court cautioned against interfering unless a clear case of arbitrariness, irrationality, mala fides, or bias is made out. The Court noted that judges often lack the expertise to adjudicate technical issues in contracts and that needless interference can cause havoc and loss to the public exchequer. The Court found no error in the decision-making process by the authority and concluded that extraordinary jurisdiction was not warranted given the facts. Therefore, the petition was dismissed.

Key Issues

1. Whether the terms and conditions stipulated in the bid document No. GEM/2022/B/1955944 and its corrigendum, specifically concerning past performance criteria, pre-bid sample submission, bid quantity requirement, and the definition of the last three financial years, are arbitrary, unjust, and violative of Article 14 of the Constitution of India, thereby warranting quashing of the bid document and subsequent work order. Petitioner's arguments: The petitioner contended that the tender conditions were tailor-made to exclude potential bidders like itself, making fair participation impossible. They argued that the increased past performance criteria (from 10% to 50% and then 80%) and the requirement to supply 50% of the bid quantity were unreasonable. The petitioner also argued that the demand for pre-bid samples was not a standard GeM practice and was difficult to fulfill within the given timeframe, especially in light of the COVID-19 pandemic. They asserted that these conditions were ex-facie arbitrary and onerous. Revenue/State's arguments: The judgment does not explicitly record arguments made by the State or Respondent No. 2. However, the Court's reasoning suggests that the State's position, implicitly, was that the decision-making process was sound and that the Court should exercise restraint in contractual matters.