M/S.Sankaranand Infra vs. The Managing Director

Facts

The petitioner, M/s. Sankaranand Infra, a civil works contractor, filed two writ petitions challenging tender notifications issued by the Tamil Nadu State Transport Corporation (TNSTC), Kumbakonam Limited. The tenders were for the construction of bus stands with estimated costs of Rs. 4.20 Crores and Rs. 40 Crores. The petitioner's grievance was against two specific conditions in the tender documents: (1) a requirement for the applicant to have completed or have ongoing a single bus stand work of similar nature with a value of at least 90% of the project value (not less than Rs. 35 Crores, including GST) within the preceding five years, and (2) an option for tenderers to present their bids directly to the authority. The petitioner contended these conditions were onerous, unreasonable, and designed to exclude contractors like them, leading to a lack of fair competition.

Held

The Court dismissed both writ petitions, finding no merit in the petitioner's challenge. Regarding the first issue, the Court held that no concrete material was placed by the petitioner to substantiate the claim that the conditions were tailor-made to exclude them or favour specific contractors. The Court noted that it is the prerogative of the tender issuing authority to prescribe eligibility criteria as they deem fit under the Act. The Court also emphasized that the petitioner lacked locus standi to challenge the tender notifications as they had not submitted a bid. Concerning the second issue, the Court found that the objection regarding direct presentation of tender documents was a general statement unsupported by legal material. The Court affirmed that direct presentation of documents is within the framework of the Act, citing Section 16 of the Act which permits receiving tender documents directly from the tender inviting authority. The Court concluded that there was nothing seriously wrong or amiss with the tender notification and the conditions imposed therein. Consequently, the writ petitions were dismissed.

Key Issues

1. Whether the condition requiring prior experience in a similar bus stand work of a value not less than Rs. 35 Crores under a single agreement within the last five years, including GST, is arbitrary, unreasonable, and ultra vires the Tamil Nadu Transparency in Tenders Act, 1998, and its Rules, thereby excluding eligible contractors? 2. Whether the option provided for direct presentation of tender documents, as stipulated in Chapter II(4)(a) of the tender conditions, is contrary to the provisions of the Tamil Nadu Transparency in Tenders Act, 1998, and the Tamil Nadu Transparency in Tenders Rules, 2000, and potentially leads to corrupt practices? Petitioner's Arguments: The petitioner argued that the experience requirement was tailor-made to exclude new contractors and favour select bidders, demonstrating mala fide intent. They contended that the direct submission option violated Rule 18 of the Tamil Nadu Transparency in Tenders Rules, 2000, which does not permit direct presentation and could facilitate corrupt practices. They relied on Rule 18 of the Tamil Nadu Transparency in Tenders Rules, 2000. Respondent's Arguments: The respondent argued that the writ petitions should be dismissed in limine as the petitioner had not submitted a bid and therefore lacked locus standi. On merits, they contended that the eligibility criteria, including the experience requirement, were within the powers of the tender inviting authority under Sections 14 and 15 of the Tamil Nadu Transparency in Tenders Act, 1998. They also argued that direct submission of tender documents was permissible under Section 16 of the Act.