M/S Tata Motors LTD. vs. The State Of Assam And 4 Ors.

Held

The Court held that the petitioner had not made out a case for interference under Article 226 of the Constitution of India. The Court emphasized that in commercial matters involving technical issues, courts should exercise restraint and caution, deferring to the opinion of experts unless the decision is arbitrary or unreasonable. The Court cited judgments highlighting that the authority floating the tender is the best judge of its requirements and that courts should interfere minimally, only to prevent arbitrariness, irrationality, bias, mala fides, or perversity. The Court noted that the authorities had applied their minds before issuing the purchase order and that an explanation was accepted based on a caveat from GeM for verification. The Standing Counsel for the Health Department undertook to verify the testimonials, including the ARAI certificate, before the supply is made. Consequently, the writ petition was dismissed, and the interim order was vacated.

Facts

The petitioner, M/s Tata Motors Ltd., filed a writ petition challenging a tender process for the procurement of 100 Type C Ambulances by the National Health Mission, Assam. The petitioner alleged that the respondent no. 5, Pinnacle Industries Ltd., a co-bidder, submitted a bid using credentials of M/s Force Motors Ltd., including an ARAI certificate for Type C Ambulances. The petitioner contended that respondent no. 5, claiming to be an Original Equipment Manufacturer (OEM), could not use another company's OEM documents. The petitioner reported this discrepancy to GeM, which acknowledged it. Despite this, a purchase order dated 27.10.2020 was issued in favour of respondent no. 5. An interim order of status quo was granted by the Court on 06.11.2020, which remained in operation.

Key Issues

1. Whether the bid submitted by respondent no. 5 was defective and liable for rejection due to the submission of credentials, including an ARAI certificate, belonging to M/s Force Motors Ltd., when respondent no. 5 claimed to be an Original Equipment Manufacturer (OEM), thereby violating the tender conditions and GeM policy. Petitioner's arguments: The petitioner argued that respondent no. 5, by declaring itself an OEM, was obligated to provide its own credentials, including its own ARAI certificate. The use of another company's certificate rendered the bid defective and ineligible for consideration. The petitioner also contended that respondent no. 5 failed to meet experience criteria, OEM turnover criteria, and past performance requirements, and that its service centers were of M/s Force Motors Ltd., not respondent no. 5. Revenue/State's arguments: The official respondents, represented by the Standing Counsel, submitted that the authorities had applied their minds and accepted the explanation provided by respondent no. 5 in view of a caveat from GeM to verify. The Standing Counsel further undertook that testimonials, including the ARAI certificate in the name of respondent no. 5, would be verified again before supply.