Delhi High Court - Orders
Entrust Corporation vs Telecommunications Consultants India ... on 25 May, 2023
Author: Prathiba M. Singh
Bench: Prathiba M. Singh
$~60
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 7340/2023 & CM APPLs. 28532/2023, 28533/2023,
28534/2023
ENTRUST CORPORATION ..... Petitioner
Through: Mr. Sandeep Sethi, Sr. Advocate
along with Mr. Vivek Jain, Mr.
Parvez Memon, Mr. Abhishek Gupta,
Mr. Manish Kumar Shekhari, Mr.
Nitin Sharma, Mr. Chirag Naik, Ms.
Noopur Mathrawala, and Ms.
Poornima Eapen, Advocates. (M:
9536650566)
versus
TELECOMMUNICATIONS CONSULTANTS INDIA LIMITED
ANR & ANR. ..... Respondents
Through: Mr. Nikhilesh Krishnan, Ms. Ritika
Priya, Mr. Bharat Belwal, AGM BD.
(M- 9340943691)
CORAM:
JUSTICE PRATHIBA M. SINGH
ORDER
% 25.05.2023
1. This hearing has been done through hybrid mode.
CM APPLs. 28533-34/2023(for exemption)
2. Allowed, subject to all just exceptions. Application is disposed of. W.P.(C) 7340/2023 & CM APPL. 28532/2023 (for stay)
3. The Petitioner-Entrust Corporation challenges the blacklisting order dated 8th February, 2023 issued by Respondent No. 1-Telecommunications W.P.(C) 7340/2023 Page 1 of 4 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2023 at 05:52:07 Consultants India Ltd. ('TCIL'). By the impugned order, the Petitioner has been banned by Respondent No. 1 for a period of five years w.e.f 8th February 2023.
4. The Petitioner is a company registered in the United States of America and manufactures hardware security modules, and one such module is called the 'nShield XC Connect HSM' or 'nShield HSM' ('the Petitioner's products'). It is claimed by the Petitioners that the said module has 'dual Gigabit Ethernet ports'.
5. Mr. Sandeep Sethi, ld. Sr. counsel for the Petitioner submits that the Petitioner had not entered into any contract with the Respondent No. 1, and therefore there does not exist any power in the Respondent, to blacklist the Petitioner. The Petitioner had merely agreed to supply certain telecom equipment to Respondent No. 1 pursuant to which the Respondent No. 1 had submitted its bid to Centre for Development of Advanced Computing ('CDAC') on 14th December, 2022. The CDAC had floated a tender on 1st November 2022, for 'supply, installation, integration, testing and commissioning of IT equipment'. According to the technical specifications outlined in the said tender, CDAC had a requirement for a "TCPIIP Network-based appliance" that included dual 1 Gigabit interfaces and dual fiber 10 Gigabit Ethernet interfaces.
6. The Respondent's bid submitted to CDAC was unsuccessful. According to the Respondent No. 1 the bid was unsuccessful due to the fact that the Petitioner's products were non-compliant with CDAC's technical specifications.
W.P.(C) 7340/2023 Page 2 of 4This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2023 at 05:52:07
7. The Respondent No. 1 then issued show-cause notices on 30th January 2023 to the Petitioner to which replies were filed. Pursuant to the said show cause notices, the impugned blacklisting order has been passed.
8. It is submitted by Mr. Sandeep Sethi, ld. Senior counsel for the Petitioner that the Petitioner's products were always compliant with CDAC's bid in view of the corrigendum issued on 29th November, 2022. Mr. Sethi further submits that no personal hearing was granted to the Petitioner. Further, in any case, the Petitioner did not violate any contractual term that could have led to the blacklisting.
9. On behalf of the Respondent No. 1 it is submitted by Mr. Nikhilesh Krishnan, ld. Counsel that the Petitioner was guilty of misleading the Respondent No. 1. In support of this allegation, he submits that in its email dated 24th January, 2023, the Petitioner's officials acknowledged that they had previously offered the same products to CDAC, for this very product specification which were not accepted by CDAC. Therefore, the Petitioner was aware of the fact that its products would not qualify as technically compliant. This fact ought to have been disclosed to the Respondent No. 1 by the Petitioner, which it chose to suppress.
10. On a query from the Court as to where does Respondent No. 1 derives the power to blacklist the Petitioner, it is submitted that Respondent No. 1 possesses inherent power to blacklist the Petitioner.
11. Heard. Both the parties have taken the Court through the various technical specifications to canvass their position. The Petitioner's position is that the Petitioner's products/equipment was fully compliant with CDAC's tender when read in conjunction with the corrigendum. The Respondent's W.P.(C) 7340/2023 Page 3 of 4 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2023 at 05:52:08 submission is to the contrary, and it is urged that it was misled by the Petitioner.
12. Issue notice in the present petition.
13. Mr. Nikhilesh Krishnan, ld. Counsel accepts notice. Let the counter affidavit be filed within six weeks. Rejoinder, thereto, be filed within four weeks.
14. Considering the technical specifications which were required, there could be ambiguity as to whether the products of the Petitioner were compliant or not. However, the power of the Respondent to blacklist is also unclear as there has been correspondence and meetings between the parties but no written agreement was executed.
15. Under such circumstances, it is directed that the Petitioner is free to participate in bids of any third parties and the blacklisting imposed by Respondent No. 1-TCIL shall not come in the way of the Petitioner. However, the blacklisting order qua Respondent No. 1-TCIL shall continue.
16. List before Registrar on 29th August, 2023.
17. List before Court on 28th November, 2023.
PRATHIBA M. SINGH, J MAY 25, 2023 dj/dn W.P.(C) 7340/2023 Page 4 of 4 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2023 at 05:52:08