Bombay High Court
M/S Omsairam Steels And Alloys Pvt. ... vs Government Of Maha., Secretary, Dept. ... on 27 January, 2025
Author: Avinash G. Gharote
Bench: Avinash G. Gharote
2025:BHC-NAG:833-DB
WP 3465 of 2023 - Judgment.odt
1
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH AT NAGPUR
WRIT PETITION NO.3465/2023
PETITIONER : M/s Omsairam Steels & Alloys Pvt. Ltd., having
its registered office at Plot No.F 1,2,3,8,9,10, Gut 5
No.46 & 63, D-53/1, Phase II, Addl. MIDC, at
Daregaon, Jalna, Maharashtra-431203,
represented through its Director Rajendra
Satyanarayan Bharuka, aged about 58 years, S/o
Mr. Satyanarayan Radhakishan Bharuka, presently 10
residing at Plot No.1992/7, Ajintha Nagar, near
Raj Mangal Karyalya, Jalna-431203.
...VERSUS...
RESPONDENTS : 1. Government of Maharashtra, Secretary,
Department of Mining, having its office at 15
Mantralaya, Mumbai.
2. State of Maharashtra, through Directorate of
Geology and Mining, at Plot Number 27,
Khanij Bhavan, Shivaji Nagar, Cement Road, 20
Nagpur, Maharashtra-440010.
3. MSTC Limited (Central Govt. Enterprise),
N.S. Building, East Wing, 1st Floor, Civil
Lines, Nagpur-440001, Nagpur. 25
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Mr. Naveen Kumar, Advocate with Mr. A.M. Quazi, Advocate for petitioner
Mr. M.J. Khan, AGP for respondent Nos.1 and 2 /State.
Mr. Sarabjeet Singh Saddal, Advocate for respondent No. 3. 30
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CORAM : AVINASH G. GHAROTE AND
ABHAY J. MANTRI, JJ.
Date of reserving the Judgment : 03/12/2024 35
Date of pronouncing the Judgment : 27/01/2025
JUDGMENT:(PER : AVINASH G. GHAROTE, J.) WP 3465 of 2023 - Judgment.odt 2
1. Rule. Rule made returnable forthwith. Heard finally with the consent of the learned Counsels for the respective parties.
2. The petition questions the action of the respondent no.1 in cancelling the auction in pursuance to the tender document dated 5 03/02/2023 for grant of a Composite License (First Attempt) for Surjagad 5 Iron Ore Block, conducted through the e-portal of the respondent No.3 and for declaring the petitioner as a preferred bidder entitled to be granted a composite license. 10
3. The facts leading to the present petition are as under :
(a) On 03/02/2023, the respondent No.2/State through the Directorate of Geology and mining, had issued an e-tender for grant of Composite License for prospecting and mining of Iron Ore in Surjagad 5 Iron Ore Block. 15
(b) On 02/03/2023, the petitioner had submitted its tender by depositing the tender fees and technical bid.
(c) On 03/05/2023 the technical bid of the petitioner came to be accepted.
(d) On 16/05/2023 e-auction was held from 11.00 a.m. and 20 continued till 7:21 p.m. and concluded with the final bid of the petitioner of 102.58%, as no further bids were offered in the online WP 3465 of 2023 - Judgment.odt 3 e-auction. The petitioner therefore claims to have been the highest bidder and thus entitled to the composite license.
(e) The respondent Nos.2 and 3, in spite of passage of time and the communications of the petitioners dated 18/05/2023, 20/05/2023 and 26/05/2023, have not communicated to the 5 petitioner its preferred bidder status and were learned to be intending to cancel the entire e-auction conducted on 16/05/2023, which has constrained the petitioner to approach this Court by way of the present petition.10
4. The petitioner is further aggrieved by the action of the respondent No.1 as indicated by the communication dated 23/08/2024 (pg. 213), by which they have taken a decision, to cancel the auction process for Surjagad 5 Iron Ore Block. This action has been taken by the respondent No.1 on the complaint of one M/s. 15 Universal Industrial Equipment and Technical Services Pvt. Ltd., who while participating in the bid for the aforesaid Block on 16/05/2023, and had offered two bids which reflects at Serial No.100 (page 210) and Serial No.30 (page 208) in the bid history submitted by the respondent No.1 on record. 20 WP 3465 of 2023 - Judgment.odt 4
5. The bid at Serial No.30 by the aforesaid Company was at 16:37:07 hours. The aforesaid Company on 16/05/2023 at 17:35:58 hours has written a mail to the respondent Nos.1 and 3 enclosing the screenshot claiming that when they tried to login, the Digital Signature Certificate (DSC) Serial No. came to be rejected on 5 account of a mismatch with the Registered Certificate (pg. 205).
6. By a communication dated 17/05/2023, the respondent No.3, who is operating a Portal for the conduct of the auctions, admitted the position that there was transient error at the time of 10 DSC verification on 16/05/2023 in respect of M/s. Universal Industrial Equipment and Technical Services Pvt. Ltd.; there was some technical glitch regarding DSC verification of the aforesaid bidder at the MSTC end, which had been resolved, on account of which, the aforesaid Company was now enabled to participate in the 15 biding for Surjagad 6 Block, which was to be held on 17/05/2023 (pg. 206).
7. It is subsequent to this, that 'sbicaps' advisor to the Government by its Email dated 18/05/2023 (pg. 211) submitted 20 two options to the respondent No.1; (1) either to annul the auction and put it up for auction again in a subsequent phase or (2) to start WP 3465 of 2023 - Judgment.odt 5 the live e-auction at a pre-decided time, from the last final price offer discovered during the live e-auction conducted on 16/05/2023 (pg.212). It is in pursuance to this by the communication dated 23/08/2024 (pg. 213), the respondent No.1 has taken a decision to cancel the auction. 5 7.1. We had requested Mr. Khan, learned Assistant Government Pleader to procure the original file of the matter, in pursuance to which, Mr. Khan, learned Assistant Government Pleader for the respondent Nos.1 and 2/State, has tendered across the bar an 10 envelope which we have opened and returned back to Mr. Khan, learned Assistant Government Pleader for the respondent Nos.1 to 2/State, after perusal thereof, for being kept in his custody. 7.2. We had thereafter requested the learned Assistant 15 Government Pleader for the respondent Nos.1 and 2/State, to take appropriate instructions regarding the reason for the technical glitch as the communication at page 206 did not show sufficient clarity to indicate the nature and the willingness of the respondent No.1 for option - 2. 20 WP 3465 of 2023 - Judgment.odt 6 7.3. On 03/12/2024, the learned Counsel for the respondent No.3/MSTC Limited (MSTC) has tendered across the bar an affidavit which is marked as 'X' for the purpose of identification. The affidavit indicates that the system of MSTC/respondent No.3 could not verify the registered Digital Signature Certificate (DSC) of M/s. 5 Universal Equipment and Technical Services Pvt. Ltd. for which reason, the said bidder could not successfully submit its bid for Surjagad 5 Iron Ore Block. It further states that the technical glitch was at the MSTC end and therefore, the plea of technical glitch as raised by the State with respect to the bidding on 16/05/2023, faced 10 by the aforesaid bidder for Surjagad 5 Iron Ore Block is correct.
8. Mr. Naveen Kumar, learned Counsel appearing for the petitioner, submits that in fact there was no technical glitch at all, which would be indicated from the bidding history at page 207, 15 which indicated that the online auction continued till 19:13:03 hours of 16/05/2023, in which the bid of the petitioner was 102.58% and was the highest.
8.1. To demonstrate that the bid of the petitioner was 20 highest, he invites our attention to the screenshot of the MSTC WP 3465 of 2023 - Judgment.odt 7 auction site (pg.178), in which it is indicated that the last bid for the live auction held was of the petitioner.
8.2. He further submits, that since the petitioner was the preferred bidder in view of being H1, a mail was written by the 5 petitioner on 18/05/2023 at 19:30:38 hours (pg.181) to the respondent No.1 seeking intimating the confirmation of the petitioner being the preferred bidder, reminder for which was also sent on 20/05/2023 at 14:07:46 hours (pg.182). A legal notice was also sent on 27/05/2023 (pg.185). 10 8.3. He further submits, that a petition filed by M/s. Universal Industrial Equipment and Technical Services Pvt. Ltd., being Writ Petition No.3584/2023 complaining a lack of opportunity to participate in e-auction dated 16/05/2023 for Surjagad 5 Iron 15 Ore Block came to be withdrawn by it, which is indicated by the order dated 26/08/2024, and therefore, the claim by the said Company of being unable to participate on account of technical glitch has been given up.
20 8.4. He further invites our attention to the proviso of the Mineral (Auction) Rules, 2015 (for short the "Rules of 2015") WP 3465 of 2023 - Judgment.odt 8 specifically Rule 17, which deals with auction for composite license, which accourding to him is applicable in the instant matter on account of the fact that the auction of Surjagad 5 Iron Ore Block, since it contemplated prospecting and mining, was a composite auction and thus such auction was to be governed by Rules 6 to 9 of 5 the Rules of 2015.
8.5. Further inviting our attention to Rule 9(9)(iii) of the Rules of 2015, he contends, that the qualified bidder, who has submitted the highest final price offer, has to be declared as the 10 preferred bidder immediately on the conclusion of the auction. 8.6. He further submits, that the auction of annulment could only be in terms of Rule 9(9)(ii) of Rules of 2015 where none of the qualified bidders submits a final price offer on the online electronic 15 auction platform, which not being the case in the instant matter, the question of annulment did not arise at all. He further submits relying upon the proviso to Rule 16(1) of the Rules of 2015, that even for the purpose of annulment, the prior approval of the Central Government would be required, which is absent. 20 WP 3465 of 2023 - Judgment.odt 9 8.7. Mr. Naveen Kumar, learned Counsel for the petitioner, invites our attention to Clause 1.1.2 of the NIT to contend that every bidder is responsible for any problem at his end like failure of electricity, loss of internet connection, any trouble with the bidder's computer which may prevent the bidder from participating in the 5 auction.
8.8. He further invites our attention to Schedule 3 of the NIT (pg.101) which enjoins upon the bidder to get his DSC updated before the bidding process. Further reliance is placed upon the 10 conduct of e-auction (pg.107), which states that during the process of electronic auction, the bidder shall be required to sign the bid with its respective DSC release of which has been specifically authorized to the bidder and which was used at the time of the registration. According to him, it specifically mandates that any DSC 15 other than the one authorized to the bidder shall not be acceptable for bid submission by the system. He further invites our attention to page 108, the process for issuance of the digital signature and that only one User ID will be mapped with a given DSC for the authorized signatory. Learned counsel also relies upon the affidavit 20 of the respondent No.3 dated 25/11/2024 and specifically point No. 3 (pg.204 of the affidavit) to contend that since the bidder had WP 3465 of 2023 - Judgment.odt 10 tried to log several times with two DSCs having different certificate numbers, the message, as quoted below therein has resulted, and therefore contends, that there was no technical glitch in the system, rather the non-participation of the bidder, was on account of fault on his fault. 5 8.9. In support of his submission, he places reliance upon Jindal Steel and Power Limited and another Vs. Union of India and others, 2023 SCC OnLine Delhi 4401 and specifically para 82, Special Leave Petition No.23313/2023 filed against which has been 10 rejected on 18/10/2023.
8.10. Learned counsel further relies upon the judgment of the Orissa High Court in Mythri Infrastructure and Mining India Pvt. Ltd. and another Vs. State of Odisha and Others, 2021 SCC OnLine 15 Ori 2436 (paras 25 to 27 and 31), Special Leave Petition against which has also been rejected by the Hon'ble Apex Court, by 2023 SCC Online SC 1028.
8.11. He also relies upon M/s Sunny Construction, through 20 its Partner Mr. Anil Baburao Mendhe Vs. The Chief Executive Officer, WP 3465 of 2023 - Judgment.odt 11 Zilla Parishad, Bhandara and Others (Writ Petition No. 1598/2021 ) decided on 07/04/2021).
8.12. He therefore submits, that any technical glitch on behalf of the bidder M/s. Universal Equipment and Technical 5 Services Pvt. Ltd. was clearly at its end and the same cannot now sought to be justified by the respondent Nos.1 to 3, specifically, when challenge by M/s. Universal Equipment and Technical Services Pvt. Ltd. in Writ Petition No.3584/2023 has been given up on account of dismissal of the petition as infructuous which is recorded 10 in the order passed in that petition dated 26/08/2024 on account of cancellation of the tender process. It is, thus, contended that the petition needs to be allowed.
9. Mr. Khan, learned Assistant Government Pleader 15 vehemently supports the cancellation of the auction on account of the technical glitch and also invites our attention to the affidavit in-reply of the respondent No.3 and specifically para 9, point No.3 to support his contention (pg.204 of the affidavit). Learned Assistant Government Pleader Mr. Khan further relies upon Clause 16.3 of the 20 NIT, which reserves in the State the right to sustain or cancel the tender process. He further contends that since the e-auction process WP 3465 of 2023 - Judgment.odt 12 was affected on account of the inability of one of the auctioneers not being able to participate, as per the statement of the respondent No.3, who was the entity, which had conducted the e-auction, the cancellation of the same, was the only option which could have been exercised by the State in all fairness and in case of a fresh auction, 5 the petitioner would be equally entitled to participate. He further contends that there is no absolute right in the petitioner, to claim entitlement to the Surjagad 5 Mineral Block, and a tender was only an offer and acceptance, non-acceptance or for that matter cancellation thereof was within the domain of the State and the 10 action of cancellation being based upon reasonability, which was depicted from the affidavit of the respondent No.3, was clearly justifiable in law. He therefore submits, that the petition be dismissed. He also relies upon Jindal Steel and Power Limited (supra) paras 95 and 96 in support of his contentions. 15
10. Mr. Sarabjeet Singh Saddal, learned Counsel for the respondent No.3, submits that in terms of the affidavit filed by the respondent No.3, who was engaged to conduct the e-auction on the e-portal, there was a technical glitch at the end of the respondent 20 No.3, on account of which, one of the e-auctioneers, was prevented from submitting its bid and though it was tried to be addressed, the WP 3465 of 2023 - Judgment.odt 13 same could not be rectified on account of which, the two options which were given to the State of either canceling the auction or re-conducting it from the stage when the glitch occurred, were clearly justified.
5
11. The question of a technical glitch faced by one of the e-mail auctioneers namely M/s. Universal Industrial Equipment and Technical Services Pvt. Ltd. will have to be considered, in light of the time factor, when a grievance in this regard was made and the nature of the technical glitch claimed. In this context, it is necessary 10 to note that the e-auction was being conducted on 16/05/2023 by the respondent No.3 between 11.00 am and 19:21:03 hours at which time it was closed. The grievance regarding a technical glitch by the aforenamed e-auctioneer, of not being able to login in the e-auction process was received by the respondent Nos.1 and 2 by 15 e-mail at 17:36 hours on the same date, which was during the course of the bidding. The affidavit dated 27/08/2024 by the respondent Nos.1 and 2, avers that the last bid which was quoted by the aforenamed e-auctioneer was at 16:37:37 hours but it was thrown out of the system with a pop-up message at around 4.45 pm 20 to 5.00 p.m. that DSC serial number mismatched with the registered certificate on account of which it was thrown out of the e-auction. It WP 3465 of 2023 - Judgment.odt 14 is further averred that though technical support assistance was given to it during live bidding, but the issue did not get resolved and the bidding closed on 19:21:03 hours. It further avers that the DSC issue of the aforenamed e-auctioneer was not resolved when the petitioner had offered its H1 bid of 102.58% at 19:13:03 hours. It 5 further avers that on the next day, i.e. 17/05/2023, the office of the respondent No.2 had called for a report on the issues faced by the above named e-auctioneer and so also to resolve the issues faced by it on 17/05/2023 too, as it was also a bidder for Surjagad 6 Block second round. The respondent No.3 has informed in response 10 thereto, that there was a transient error at the time of DSC verification on 16/05/2023. It further states that upon a clarification being sought from the respondent No.3, it has been stated that the technical glitch regarding DSC verification of the above named e- auctioneer was at the MSTC/respondent No.3's end. The message, 15 which has been received by the above named e-auctioneer on 16/05/2023 regarding the mismatch of the DSC serial number is at page No.205 of the record and is reproduced as under: 20
WP 3465 of 2023 - Judgment.odt 15 5 What is also necessary to note, is that the respondent No.3, has owned-up the responsibility of a technical glitch faced by the aforenamed e-auctioneer on 16/05/2023 in respect of the Surjagad 5 Iron Ore Block, which is reflected from its communication dated 10 17/05/2023, the relevant portion of which is quoted as under:
"This has reference to the meeting held at your good office on the several representations received from M/s Universal Industrial Equipment & Technical Services Pvt. Ltd. regarding the issues faced by them during live bidding on yesterday for 15 Surjagad 5 Iron Ore Block.
In this regard, this is to inform that support assistance was given to the bidder during live bidding but the issue didn't get resolved yesterday.
Today again the issue was taken up for troubleshooting and the 20 issue has been resolved. The same has been communicated to Universal Industrial Equipment & Technical Services Pvt. Ltd for participation in today's bidding for Surjagad 6 block. As regard to the issue faced by M/s Universal Industrial Equipment & Technical Services Pvt. Ltd during live bidding on 25 yesterday for Surjagad 5 Iron Ore Block, it has been informed by our Systems Dept. that "there was transient error at the time of DSC verification yesterday. There was some technical glitch regarding DSC verification of the said bidder at MSTC end."30
WP 3465 of 2023 - Judgment.odt 16
12. Initially, we had some reservations regarding the reason for the technical glitch, which is reflected from our order dated 24/09/2024, on account of which, we had asked the respondent No.3, to make a specific statement as to the nature of the technical glitch in pursuance thereto, the respondent No.3 has filed its 5 submissions on record on 25/11/2024. The relevant portion, is as under:
"Point no.-3. Root cause analysis of incident. System could not fetch the registered DSC details of mentioned bidder due to intermittent deadlock in the backend i.e. database end and hence 10 could not verify the DSC for signing the bid before recording. The bidder M/s Universal Industrial Equipment and Technical Services Private Limited tried to log in several times and with two DSCs having different certificate serial number. The following message was displayed to the bidder; 15 "Your registered DSC serial no.: Your presented DSC serial no. :: action has been rolled back because of a deadlock or timeout. Reason code- 68, SQLCODE=-911 SQLSTATE=40001, DRIVER=4.26.14"
This proves that the system could not fetch the registered DSC 20 serial number either due to deadlock or timeout resulting non display of serial number in the message above against "Your registered DSC serial number". Deadlock is momentary and can happen in row level / table level / full database level. The error faced by the said bidder was related to his row level DSC record 25 which prompted the error message. The said bidder was not taking active part in the bidding for a long time and DSC was removed and added at multiple times which may have triggered this row level deadlock."
30
13. In Jindal Steel and Power Limited (supra) a plea of a technical glitch claimed to have arisen during the bidding process, WP 3465 of 2023 - Judgment.odt 17 on account of which the petitioner's claim of unable to participate, was turned down on the ground that the material on record showed that at the time when the auction for Chhendipada (Revised) Coal Mine was going on, two more auctions - one for Parbatpur Central Mine (40729) and the other for Datima Mine (40733), were being 5 conducted on the very same e-auction portal. Material on record indicated that between 14 : 48 : 09 hrs to 14 : 56 : 09 hrs, i.e. the time period in which the petitioner claimed to have faced technical glitches on the e-auction portal, bidders were able to place their bids for the other two mines. Bids were received at 14 : 51 : 57 for 10 Parbatpur Central Mine and for Datima Mine bids were received at 14 : 48 : 13, 14 : 49 : 14, 14 : 54 : 10 & 14 : 56 : 10. Since the bidders for two other auctions for coal mines were about to place the bids, which were being conducted at the very same time on the very same portal, it was held that it could not be said that there was 15 a technical glitch in the portal of respondent No.3. It was held that the petitioner had not been able to make out a case that there was a technical glitch across the board on the portal on which e-auctions were being conducted and the Court came to the opinion that in view of the fact that there was no glitch on the portal of the MSTC, 20 on which the e-auctions were being conducted, it would be improper WP 3465 of 2023 - Judgment.odt 18 to set aside the result of the e-auction only on the ground that the petitioner was prepared to give a higher bid.
13.1. Mythri Infrastructure and Mining India Pvt. Ltd. (supra) the factual position was as under : 5 "8. According to the Petitioners, on successful submission/uploading of the technical bid of Petitioner No.1, the link/button for the IPO was activated on the e-portal of Opposite Party No. 3. The Petitioners state that upon the link/button being clicked, they were directed to a webpage for filling up the IPO 10 figure. After filling in the IPO when the Petitioners clicked on the final submission button "unexpectedly, on account of technical glitches on the server of MSTC, the relevant page on the MSTC portal kept expiring at frequent intervals which prevented the Petitioner from affixing its Digital Signature." It is stated that 15 despite repeated attempts to save/submit the IPO and click on the final submission button prior to the deadline of 3 PM on 24 th August, 2021, the web page maintained by Opposite Party No.3 kept expiring "without any fault of the Petitioner No.1." 20 This is what has been held :
"25. While the Petitioners might contend that their inability to upload the IPO was for reasons entirely outside their control, the fact remains that there was no technical glitch on the side of Opposite Party No. 3. The log enclosed with its counter affidavit 25 makes it abundantly clear that none of the other bidders encountered any difficulty in uploading the technical bid as well as the IPOs."30
13.2. In M/s Sunny Construction (supra), what was under
consideration was a plea of a technical reason, on account of which the petitioner claimed that he could not upload the file of the Bills of WP 3465 of 2023 - Judgment.odt 19 Quantity (BOQ), with the tender form while submitting its bid, as the file used for that got corrupted in the process. A message was also sent to the respondent No.2, therein on the last date of submission of the bid by e-mail at 4:53 p.m., who, however refused to acknowledge that there was any technical error. An extension of 5 time was refused, on account of which, the petition was filed.
Therefore, in this background, it has been held that since all other persons, who had submitted their bids along with the BOQ, had not faced any issues while uploading it, along with their bids, online, the plea of any technical error could not be accepted, as it would have 10 universally affected all the bidders.
13.3. What is necessary to note is that in Jindal Steel and Power Limited ; Mythri Infrastructure and Mining India Pvt. Ltd. as well as in M/s Sunny Construction (supra) the agency which was 15 entrusted with the work of conducting the auction MSTC had also categorically asserted that no such glitch ever occurred on its platform.
14. The position in the case in hand is different, in as much 20 MSTC Limited, which is also the respondent No.3, in the instant matter, has come out with a specific case that there was in fact a WP 3465 of 2023 - Judgment.odt 20 technical glitch, in the system, as claimed by one of the bidders, on account of which, it was unable to participate in the bidding process.
In fact the MSTC/respondent No.3, has specifically owed up the existence of the technical glitch and that the same was on account of the system and not the fault of the bidder. This being the position, 5 when the agency operating the platform, wherein the online bidding was conducted, itself, comes on record to state that there was a technical glitch, for which the fault lays with the MSTC/respondent No.3, on account of which, the bidder could not participate further, in the online auction process, the Court not being a technical expert, 10 would have to rely upon the stand of the MSTC/respondent No.3, in this regard, which is reflected from the averments in its affidavit as quoted in para 12 (supra).
14.1. Though a valiant effort has been made by Mr. Naveen 15 Kumar, learned counsel for the petitioner to contend that there was no technical glitch, and the fault lays with the bidder, who claimed as such, for which he relies upon the reply of the MSTC/respondent No.3, [affidavit dated 25/11/2024 (pg.204)], which states that 'the bidder M/s Universal Industrial Equipment and Technical Services 20 Private Limited, tried to login several times and with two DSC's having different certificate serial numbers' and so also the statement WP 3465 of 2023 - Judgment.odt 21 in the same para "The said bidder was not taking active part in the bidding for a long time and DSC was removed and added at multiple times which may have triggered this row level deadlock"; Clause 1.12. of the NIT (pg.45), which states that each bidder shall be responsible for any problem at the Bidder's end like failure of 5 electricity, loss of Internet connection, any trouble with the Bidder's computer etc., which may cause inconvenience or prevent the Bidder from bidding in e-auction; clarification in Stage 2 : Electronic Auction : Final Price Offer (pg.107), which deals with the conduct of auction and states that during the process of electronic auction, the 10 bidder shall be required to sign their bids with their respective digital signature certificate (DSC) and the use of which has been duly authorised on behalf of the bidder and which was used at the time of registration and any digital signature certificate other than the above shall not be acceptable for bid submission by the system, 15 to contend that the fault lays not with the system but with the bidder, as it has used two different DSCs, which was not permissible in terms of the conditions of the NIT and thus it was the bidder, who was solely responsible for the rejection of the DSC on account of the mismatch, even if we presume this to be so, it equally remains a fact 20 that the MSTC/respondent No.3, has come on record to state that the fault was at the MSTC/respondent No.3's end, this clearly WP 3465 of 2023 - Judgment.odt 22 creates a situation of disputed questions of facts, which would then be required to be tested not in a writ petition but in a properly instituted civil suit, where evidence will have to be recorded, regarding the nature of the technical glitch and a finding regarding whose fault it was. No doubt true that M/s. Universal Industrial 5 Equipment and Technical Services Private Limited has withdrawn the Writ Petition as filed by it, that however does not deter from the stand of the MSTC/respondent No.3, which is on record in the present matter. We have called for the record of Writ Petition No.3584/2023 and found that no submissions have been filed by 10 MSTC/respondent No.3, in that petition, as no notices were ever issued to it. In such circumstances, the stand taken by the respondent No.3, in the present petition, would be the one, which would hold the field, vis-a-vis the respondent No.3. The MSTC/respondent No.3, being an agency conducting the online 15 auction on its platform, cannot be said to be unaware of the consequences of its stand before the Court and its effect and when it takes a specific stand as reflected from its communication dated 17/05/2023 (pg.206), which is of the immediate next date of the auction that "there was some technical glitch regarding the DSC 20 verification of the said bidder at MSTC end", it would not be WP 3465 of 2023 - Judgment.odt 23 permissible for this Court to go into the truthfulness or falsity of this statement in its writ jurisdiction, as indicated earlier. 14.2. That apart, the terms of the NIT confer upon the respondent Nos.1 and 2, an unabridged right to cancel the tender 5 process. Clause 16.3 (pg.82 ) of the NIT reads as under :
"16.3.1. The State Government, in its sole discretion and without incurring any obligation or liability, reserves the right, at any time, to;
(a) Suspend and/or cancel the tender process and/or amend 10 and/or supplement the tender process or modify the dates or other terms and conditions relating thereto;
(b) Consult with any Bidder in order to receive clarification or further information;
(c) retain any information and/or evidence submitted to the 15 State Government by, on behalf, of, and/or in relation to any Bidder; and/or
(d) independently verify, disqualify, reject and/or accept any and all submissions or other information and/or evidence submitted by or on behalf of any Bidder." 20 14.3. The series of events which took place on 16/05/2023, the date of the online auction, have been narrated in para 11 supra.
The MSTC/respondent No.3, having found that there was a technical glitch at its end, which prevented one of the bidders from 25 participating in the tender process, upon being queried by the respondent Nos.1 and 2, by its e-mail dated 18/05/2023 (pg.211-
212) while reiterating the technical glitch at MSTC's end, had given two options to the respondent Nos.1 and 2, Option 1: being to WP 3465 of 2023 - Judgment.odt 24 annul the auction process for Surjagad 5 Iron Ore block and to put it up for auction again, which would not be considered as a second attempt and the reserve price to be considered as 102.58% the final price as received on 16/05/2023 and Option 2: to restart the live e-auction at a pre-decided time, from the last final price offer 5 discovered during the live e-auction conducted on 16/05/2023. The respondent Nos.1 and 2, have vide the communication dated 23/08/2023 (pg.213) took the decision to cancel the auction. 14.4. As is the settled position of law, mere participating in 10 the auction, or for that matter even of being the highest bidder thereof, would not confer any legal right upon the participant/highest bidder, to grant of a contract, as the bid is in fact an offer and till its unequivocal acceptance, does not result in any right being created in such person, and all that such a person, in 15 case of not accepting his bid or cancellation of the auction process, claim, would be damages.
14.5. In the instant case also, since there was a controversy regarding the participation of one of the bidders in the online 20 auction process, which as indicated above was on account of the fault of agency conducting the e-auction, which position stood WP 3465 of 2023 - Judgment.odt 25 admitted by the MSTC/respondent No.3, which was conducting the e-auction and the position having been accepted by the respondent Nos.1 and 2, the decision to cancel the auction cannot be faulted with. That such a right existed in the respondent Nos.1 and 2, is amply clear by the language of Clause 16.3 of the NIT as quoted 5 above and merely because the respondent Nos.1 and 2, have erred on the side of caution by accepting Option-1, to put the block to auction again, it cannot be said to be unreasonable or arbitrary as such an action would make the field open to one and all again, to participate. 10
15. It is held in Mythri Infrastructure and Mining India Pvt. Ltd. (supra) as under :
28. The scope of interference by the writ Court in such matters is limited. The legal position in this regard has been explained in 15 Michigan Rubber (India) Ltd. v. State of Karnataka, (2012) 8 SCC
216. The decision of the High Court of Karnataka in Mahindra Sanyo Special Steel Private Ltd. v. Union of India, ILR 2018 Kar 5587 is instructive. To the same effect is the decision in Silpi Constructions Contractors v. Union of India, (2020) 16 SCC 489, 20 where it was observed as under:
"20. The essence of the law laid down in the judgments referred to above is the exercise of restraint and caution; the need for overwhelming public interest to justify judicial intervention in matters of contract involving the State 25 instrumentalities; the courts should give way to the opinion of the experts unless the decision is totally arbitrary or unreasonable; the court does not sit like a court of appeal over the appropriate authority; the court must realise that the authority floating the tender is the best judge of its 30 WP 3465 of 2023 - Judgment.odt 26 requirements and, therefore, the court's interference should be minimal. The authority which floats the contract or tender, and has authored the tender documents is the best judge as to how the documents have to be interpreted. If two interpretations are possible then the interpretation of the 5 author must be accepted. The courts will only interfere to prevent arbitrariness, irrationality, bias, mala fides or perversity. With this approach in mind we shall deal with the present case."
31. The timelines in a tender and the process itself ought not 10 to be lightly interfered with as was observed in Uflex Ltd. v. Government of Tamil Nadu, 2021 SCC OnLine SC 738 as under:
"In commercial tender matters there is obviously an aspect of commercial competitiveness. For every 15 succeeding party who gets a tender there may be a couple or more parties who are not awarded the tender as there can be only one L-1. The question is should the judicial process be resorted to for downplaying the freedom which a tendering party has, merely because it is a State or a 20 public authority, making the said process even more cumbersome. We have already noted that element of transparency is always required in such tenders because of the nature of economic activity carried on by the State, but the contours under which they are to be examined are 25 restricted as set out in Tata Cellular 26 and other cases. The objective is not to make the Court an appellate authority for scrutinizing as to whom the tender should be awarded. Economics must be permitted to play its role for which the tendering authority knows best as to what is 30 suited in terms of technology and price for them."
16. The approach of a Court in tender matters, thus has to be circumspect, restricted to examination of the process being transparent, reasonable and non-arbitrary, with a play in the joints 35 to the tendering authority to decide its requirement. This does not mean that the Courts would be helpless in interfering in tender WP 3465 of 2023 - Judgment.odt 27 matters when they find that the process is opaque, unreasonable or biased, for in such circumstances, it would be the duty of the Courts to do so. The interference thus would depend on the facts and circumstances of each case and the principles to be applied accordingly. We, therefore, find that this is not a fit case where we 5 should exercise our discretion to interfere in the tender process, on account of the agency conducting the e-auction online having admitted to a fault being at their end. In light of these findings, we, need not examine the pleas raised as to the statutory mandate of the Mineral (Auction) Rules, 2015, since these would be attracted only 10 upon the auction having been successfully being conducted and completed, which is not the position in the present matter. The writ petition is, therefore, dismissed. Rule stands discharged. Considering the circumstances, there shall be no order as to costs. 15
(ABHAY J. MANTRI, J.) (AVINASH G. GHAROTE, J.)
20
Belkhede/Wadkar
Signed by: S.S. Wadkar (SSW)
Designation: PS To Honourable Judge
Date: 28/01/2025 11:20:00