Gujarat High Court
Master Enterprise vs Food Corporation Of India on 16 June, 2025
Author: A.S. Supehia
Bench: A.S. Supehia
NEUTRAL CITATION
C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO.7528 of 2025
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE A.S. SUPEHIA Sd/-
and
HONOURABLE MR.JUSTICE R. T. VACHHANI Sd/-
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Approved for Reporting Yes No
4
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MASTER ENTERPRISE
Versus
FOOD CORPORATION OF INDIA & ORS.
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Appearance:
MR DHAVAL D VYAS, SENIOR ADVOCATE, with MR MAULIN G
PANDYA(3999) for the Petitioner(s) No. 1
MR NIRAD D BUCH(4000) for the Respondent(s) No. 1
MR SHALIN MEHTA, SENIOR ADVOCATE, with MR.CHINMAY UPADHYAY
with MR.DEV KELLA for the Respondent(s) No.2
DELETED for the Respondent(s) No. 3
MS NIKITA SHARMA for MR.AKSHAY MATANI for the Respondent(s) No.4
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CORAM:HONOURABLE MR. JUSTICE A.S. SUPEHIA
and
HONOURABLE MR.JUSTICE R. T. VACHHANI
Date : 13 & 16 /06/2025
ORAL JUDGMENT
(PER : HONOURABLE MR. JUSTICE A.S. SUPEHIA)
1. RULE. Learned advocate Mr.Nirad D. Buch for the respondent No.1-Food Corporation of India (FCI), learned advocate Mr.Chinmay Upadhyay for respondent No.2-M/s.K.B. Enterprise and learned advocate Ms.Nikita Sharma for learned advocate Mr.Akshay Matani for respondent No.4-Government e-Marketplace (GeM), appear and waive service of notice of rule on behalf of the respective respondents.
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2. On behalf of learned advocate Mr.Akshay Matani, it is submitted that since respondent No.4-GeM is a formal party, it would like not to contest the matter.
BRIEF FACTS
3. The present writ petition emanates from the Tender being GEM/2025/B/5977638 floated by respondent No.1-FCI on 20.02.2025 for appointment of H & T Contractor for loading / unloading / handling and transport of food grains and allied material etc. in and around Food Storage Depot (FSD), Valsad. The entire Bid Process was to be held on GeM Portal and the Tender Document was to be purchased from the Portal and the supporting documents in this regard were to be uploaded by the concerned bidders. The last date for submitting the on- line bid as well as the date of opening of the Technical Bid was 13.03.2025, whereas the date of opening of the Price Bid of technically qualified tenderers was to be notified at a later stage.
4. Accordingly, petitioner-Master Enterprise, a Proprietorship Firm, participated in the tender and uploaded the Technical Bid and Price Bid Page 2 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined along with all the necessary supporting documents. It is the case of the petitioner that the petitioner had placed a bid of value of contract worth Rs.30,65,04,000/-, which is lower than the bid valued by respondent No.2- M/s.K.B.Enterprise being Rs.34,48,17,000/-.
5. On 14.05.2025, the GeM Portal dispatched the reason for technical evaluation and the technical evaluation history and the petitioner was declared disqualified for "Not meeting the eligibility criteria specified in Bid Clause as per details indicated in the comment.". The comment mentioned in the GeM Portal is "Technically disqualified as per terms and conditions of MTF". On the very same day i.e. on 14.05.2025, the petitioner made a representation to the General Manager of respondent No.1-FCI inquiring for the specific reason for disqualification. Thereafter, on 16.05.2025, at 11:45, the clarification history at the GeM Portal displayed as under:
"Illegible documents of Work Experience, Work Order, EPF & ESIC Certificate uploaded in tender, but as per MTF only legible documents should be uploaded"
6. The petitioner has attempted to take shelter under the disqualification comment displayed on Page 3 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined the GeM Portal and the note therein mentioned about Paragraph No.7.3.5 of the Clarification of Bids / Shortfall Documents of the Manual for Procurement of Goods, 2017 issued by the Ministry of Finance, Department of Expenditure. It further mentions that the request for clarification on the bid shall be given asking the tenderer to respond by a specified date and if the tenderer does not comply or respond by the date, his tender will be liable to be rejected.
7. On 16.05.2025, the petitioner made a representation to the respondent No.1-FCI informing that, they have re-uploaded the same documents, which were illegible on the GeM Portal for further verification. An affidavit, confirming the authenticity of the documents, was also submitted.
8. It appears that the Technical Evaluation Committee (for short "the TEC") considered the representation of the petitioner and rejected the same on 16.05.2025. Thereafter, it appears that the subsequent representation, which was made by the petitioner after uploading the documents, was also reconsidered by the Committee and a report was prepared on Page 4 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined 23.05.2025 rejecting the same by assigning the same reasons. The reasons specified in both the Committee Reports dated 16.05.2025 (Page 243) and dated 23.05.2025 (Page 245) disclose that the Committee was impressed upon the conduct of the petitioner in repeating the same lacuna of uploading the illegible documents and it was found that a deliberate tendency to misuse the representation mechanism to rectify non- compliance post facto has been adopted. The Committee also opined that allowing such conduct would undermine the integrity and fairness of the bidding process and would set a negative precedent. It was also expressed by the Committee that benefit of document was already extended to the present petitioner (bidder) in a previous case, and it cannot be allowed again for repeated non-compliance. It was also recorded that allowing the post facto corrections through the representation would be inconsistent with the tender terms and could compromise the fairness of process. By recording these reasons and in light of the Contract Manual Clause-3.10 of the FCI Manual dated 01.07.2024, the Committee concluded that the representation of the petitioner was devoid of merits and does not warrant any change in Page 5 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined the technical evaluation outcome.
9. It appears that thereafter, the respondent No.1-FCI opened the Price Bid on 27.05.2025 and thereby declared respondent No.2-M/s.K.B. Enterprise as the lowest bidder, which resulted in filing of the present petition.
SUBMISSIONS ON BEHALF OF THE PETITIONER:
10. Learned Senior Advocate Mr.Dhaval D. Vyas assisted by learned advocate Mr.Maulin G. Pandya, appearing on behalf of the petitioner has pointed out Clause-8(j) of the Tender Notice and has submitted that only mistake which the petitioner has committed is of uploading the documents by compressing the same, which resulted the same as illegible documents. It is submitted that this defect was a curable defect and hence, the petitioner ought to have invoked Paragraph No.7.3.5 of the Clarification of Bids / Shortfall Documents of the Manual for Procurement of Goods, 2017 issued by the Ministry of Finance, Department of Expenditure. He has also referred to Clause- 3.10 of the FCI Manual dated 01.07.2024 in this regard. While referring to the said provision, it is submitted that though the respondent-FCI had the discretion to allow the present Page 6 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined petitioner to rectify any infirmity, such opportunity was never offered and as soon as the petitioner was made aware of the disqualification, immediately, on the very same day i.e. 24.05.2025, a representation was made to the respondent-FCI inquiring about the specific reason / cause declaring them as disqualified in the Technical Bid. It is submitted that within a period of two days, the petitioner uploaded the very same documents in a legible format and in such circumstances, the respondent-FCI could not have disqualified the petitioner from the Technical Bid.
11. It is contended that it is not that for the first time the petitioner has entered into a contract with the respondent-FCI, but earlier in the year 2024, in a contract at Palanapur Region, the petitioner was declared as a successful bidder, after the respondent-FCI had condoned the defect of uploading the illegible documents. It is submitted that the respondent- FCI has all the powers to condone a negligible defect or a rectifiable defect and it is not the case of the respondent-FCI that the petitioner has been done it deliberately in order to gain the contract. Learned Senior Page 7 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined Advocate has also submitted that the documents in the earlier contract with the FCI at FSD, Palanpur Region were also very relevant documents and the same process was required to be followed in the present case also, after the petitioner had uploaded the documents in the legible form.
12. That for the very first time the respondent-
FCI, through its decision dated 23.05.2025, conveyed that their representation was rejected only on the sole reason of illegible documents at the time of bidding submission vide Committee Report dated 23.05.2025. It is submitted that when the petitioner had uploaded the legible documents on 16.05.2025 along with the representation, the petitioner was under an impression that such legible documents would be considered by the Committee, however, the initial representation was rejected by the Committee's Report dated 16.05.2025 by resorting to the Contract Manual Clause 3.10 of the FCI Manual dated 01.07.2024.
13. While placing reliance on the judgment of the Supreme Court in the case of Jal Mahal Resorts Private Limited vs. K.P.Sharma, 2014 (8) S.C.C. Page 8 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined 804, wherein the Supreme Court has referred to earlier decision in the case of Poddar Steel Corporation vs. Ganesh Engineering Works, 1991 (3) S.C.C. 273, it is submitted that minor technical irregularity and deviation from non- essential or ancillary / subsidiary requirement can be waived and the Government, in the present case the respondent-FCI, would be justified in waiving technical compliance with the tender condition.
14. Learned Senior Advocate Mr.Vyas has also referred to the decision of the Supreme Court in the case of B.S.N. Joshi & Sons Ltd. vs. Nair Coal Services & Anr., (2006) 11 S.C.C. 548, more particularly Paragraph No.69 thereof and has submitted that an employer has power of relaxation in the matters of tender, which can be found out not only from the terms of the notice inviting tender but also the general practice prevailing in India. He has also referred to the decision of the Supreme Court in the case of Rashmi Metaliks Limited & Anr. vs. Kolkata metropolitan Development Authority & Ors., (2013) 10 S.C.C. 95 in support of his submission and it is urged that a negligible defect of such a nature of uploading the Page 9 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined documents can always be condoned in public interest. It is submitted by learned Senior Advocate Mr.Vyas that in the present case there is a huge difference between the offer of the present petitioner and respondent No.2-M/s.K.B. Enterprise to the tune of almost Rs.4 crores. Thus, it is urged by the learned Senior Advocate that looking to the overall public interest, the decision of disqualifying the petitioner from the Technical Bid may be set aside.
DATED 16.06.2025:
15. In response to the aforesaid submissions, learned Advocate Mr.Buch appearing for the respondent-FCI has submitted that the present writ petition may not be entertained, as the petitioner is a habitual in committing the same mistake by submitting illegible documents. It is submitted that the contention, as regards compressing the size of the documents, does not appear to be bona fide on behalf of the petitioner, which has resulted into the illegible documents.
16. Learned Advocate Mr.Buch has submitted that the representations made by the petitioner were categorically considered by the Technical Page 10 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined Evaluation Committee and accordingly, it was informed that in view of Clause-3.10 of the FCI Manual, the respondent-FCI does not find favour to rectify the grounds or to seek any clarification with regard to the legible documents. It is submitted that the petitioner, who had made the same mistake earlier in case of another tender, which was floated by the FCI for FSD, Palanpur Region cannot be allowed again to take advantage of the earlier discretion exercised by the respondent-FCI. He has further submitted that there is a fundamental difference between two instances i.e. between the earlier tender for FSD, Palanpur Region and in the present case.
17. Learned advocate Mr.Buch has further contended that in the Technical Bid of tender in case of FSD, Palanpur Region, which was floated on 19.11.2024 was opened on 10.12.2024 and since the petitioner was technically disqualified as the EPF Certificate and Experience CA Certificate, which were uploaded by the petitioner were not found illegible, on the representation of the petitioner, the legible copies of the EPF Certificate and Experience CA certificate were subsequently accepted by the Page 11 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined TEC. He has further submitted that such documents were supporting in nature and the respondent-FCI exercised its discretion, in order to accept such documents. However, it is submitted that in the present case, the vital documents, which were uploaded by the petitioner under Clause-3 of the General Information to Tenderers, which deals with the experience from Manufacturers / PSU / Government Department / Public Limited Company / Private Limited Company dealing in the field of Fertilizer, Food Grains, Cement, Sugar, Coarse Grains or similar products, the tenderer is required to submit the legible copies of these vital documents. However, since the petitioner has not submitted the legible documents, the Committee could not verify and cross-check the contents of the certificates with the work. It is submitted that the TEC/ Committee prepared a Scrutiny-Sheet of Technical Bid, after verification of the documents uploaded by the respective bidders and the TEC found that since the petitioner had not uploaded the legible copies of - (a) Work Experience Certificate; (b) Work Order; and (c) ESIC (Employees State Insurance Corporation) Certificate, it was not possible for the TEC to Page 12 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined correlate the contents of the said certificate with the Work Order placed and the EPF Certificate submitted by the petitioner was also incomplete and several clauses were missing therein. It is thus submitted that these are the vital documents which ought to have been produced by the petitioner with due care and caution and since he has failed to do so, the indulgence, which has been granted by the respondent-FCI in the earlier tender, cannot be extended on all occasions.
18. Learned Advocate Mr.Buch has further referred to the contents of condition nos.8(h), (j), (k) and (l) of the tender document and has submitted that the petitioner was required to submit a neatly and accurately readable documents in the prescribed format and in case the instructions issued therein were not complied with, the respondent-FCI had the discretion to summarily reject the Bid. Learned Advocate Mr.Buch has submitted that such a defect is not rectifiable defect or condonable in wake of the fact that the petitioner has earlier committed the same mistake. Learned Advocate Mr.Buch has referred to Clause No.11, wherein right is reserved in favour of the Page 13 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined respondent-FCI to reject any or all the tenders without assigning any reason and does not bind itself to accept the lowest or any tender.
19. Learned Advocate Mr.Buch has referred to Clause No.8 of the Tender and has submitted that the same specifically mentions that the Terms and Conditions stipulated in the Model Tender Form (MTF) (shall prevail over the General Terms and Conditions (GTC of GeM Portal). Hence, the respondent-FCI is not bound by Clause No.7.3.4 or any communication from the GeM Portal. Thus, it is urged that the petition may not be entertained at this stage.
20. Learned Senior Advocate Mr.Shalin Mehta appearing with Mr.Upadhyay for respondent no.2 has adopted the arguments canvassed by learned Advocate Mr.Buch for the respondent-FCI. However, he has submitted that the petitioner, being a habitual in committing the same mistake, cannot be accepted the indulgence granted earlier by the respondent-FCI. It is submitted that the petitioner is intentionally uploading the illegible documents and has suppressed the material facts and in fact has tried to project as if it was a mistake in Page 14 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined compression of the file. It is submitted that the petitioner is bidding with two accounts with two different not so related firms on the paper and from one account they bid the lowest and from another they bid the highest, and the illegible documents are uploaded from the lowest bid account as the Committee Report declares the non-qualified and the qualified bidders after technical evolution of the petitioner comes to know about the total numbers of bidders, and if there is no competition than they will carry-on with the highest bid account and if there is competition from many bidders than they will file a writ petition and fight for the lowest bid account by stating that it is just a pixel problem. It is alleged that in fact it is very big planned strategy to rig the entire tendering process to gain more profit.
21. In rejoinder, learned Senior Advocate Mr.Vyas has submitted that the documents which were accepted, later-on, in the FSD, Palanpur Region tender by the respondent-FCI, were in fact also very vital akin to the similar documents and since the respondent-FCI is not justified in accepting the request of re-submission of Page 15 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined documents in one tender and rejecting the same in another tender i.e. the present one. It is submitted that in public interest since the Financial Bid of the petitioner is lower to the tune of approximately Rs.4 crores, the respondent-FCI may be directed to allot the Work Order to the petitioner, after declaring him successful in the Bid.
ANALSYSIS AND OPINION:
22. We have heard the learned counsel appearing for the respective parties.
23. The entire case of the respective parties hinges on the sole issue of the illegible documents submitted by the petitioner in the Technical Bid. The date of opening of the on- line bid submission was 20.02.2025. The last date of submissions was on 13.03.2025 at 16:00 hrs. The Technical Bid opening was on 13.03.2025 at 16:30 hrs. and the Price Bid date was to be notified on later date. The important clauses in the Tender Notice are Clause-8(h),
(j) (k) (l) [Page No.43], which read thus:
"(h) Tender which do not comply with these instructions shall be summarily rejected.
(j) The supporting documents shall be scanned and uploaded by Tenderer clearly, neatly and accurately in readable format. Any alteration, Page 16 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined erasures or overwriting on the supporting documents should be duly initiated by the authorized signatory.
(k) Tenders not accompanied by all the Schedules/Annexures intact and duly filled in and signed will be rejected.
(l) It should be clearly understood by the Tenderer that no opportunity shall be given to them to alter, modify or with-draw any offer at any stage after submission of the tender."
24. The relevant documents, which the petitioner had uploaded and were found illegible by the respondent-FCI are - (a) Work Experience Certificate; (b) Work Order; and (c) ESIC Certificate (Certificate of Employees State Insurance Corporation).Unquestionably, these are the very vital documents which were required to be examined by the respondent-FCI.
25. Accordingly, on 14.05.2025 the petitioner was declared as disqualified on the GeM Portal by observing thus:
"Not meeting the eligibility criteria specified in the bid clause as per the details indicated in the comment."
26. On same date i.e. 14.05.2025, the petitioner informed the respondent-FCI to inform the detailed reasons for disqualification. At their request, the representation dated 16.05.2025 at 11:45, the GeM Portal display "Illegible Page 17 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined documents of Work Experience, Work Order, EPF & ESIC Certificate uploaded in tender, but as per MTF only legible documents should be uploaded."
27. After the reasons were assigned, the petitioner again made a representation to the respondent- FCI on 16.05.2025 and re-uploaded the documents to the GeM Portal for further verification.
28. It appears that the first representation, which was made, was considered by the Technical Evaluation Committee (TEC), and the same was rejected by resorting to Clause-8 of the Model Tender Form and the Notice Inviting Tender (NIT) Clause-8, which clearly suggests that all documents uploaded must be legible and self- attested. The subsequent representation was also considered by the TEC by the Report dated 23.05.2025 and by reiterating the same reasons the representation was rejected. The Committee concluded thus:
"The Committee concluded that:
* The bid evaluation is to be done based on documents submitted at the time of bid submission, since these legible documents are submitted substitutionally post facto, hence as per clause 3.10 of contract manual, cannot be entertained.Page 18 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025
NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined * Allowing post-facto corrections through representation would be inconsistent with tender terms and could compromise the fairness of the process.
* Further the work experience, work order and ESIC were completely illegible & some points of EPF certificate were found missing at the time of bid submission, hence committee cannot ascertain the post submission of the legible documents are same as submitted earlier during bid submission. Hence these documents are additional documents.
Accordingly, the Committee re-affirmed its decision and rejects the representation dated 17.05.2025 of M/s Master Enterprise.
As per Contract Manual Clause 3.10 - Seeking Additional Documents:
"Tender Awarding Authority reserves the right to disqualify the bid as per terms and conditions, and no request for alteration, modification, substitution or withdrawal shall be entertained by the Authority in respect of such bid."
These facts are not in dispute and are established from record.
29. The petitioner has endeavored to impress this Court to interfere with the tender process and the allocation of tender in favour of respondent no.2 by contending that there was a mistake in uploading the documents and due to compression of the files, such illegible documents could have been accepted after the Page 19 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined re-submission and in fact the petitioner was required to be informed by the respondent-FCI and accordingly, the clarification was required to be sought from the petitioner, before rejecting the Technical Bid. It is also the case of the petitioner that it is curable defect and hence, the respondent-FCI fell in error in rejecting the Technical Bid of the petitioner, and in public interest, the bid of the petitioner is required to be accepted.
30. At this juncture, it would be apposite to refer to the decision of the Supreme Court in the case of West Bengal State Electricity Board vs. Patel Engineering Company Limited, 2001 (2) S.C.C. 451, wherein the Supreme Court, on the issue committing mistake in uploading the documents, has held thus:
"28. Exceptions to the above general principle of seeking relief in equity on the ground of mistake, as can be culled out from the same para, are:
(1) Where the mistake might have been avoided by the exercise of ordinary care and diligence on the part of the bidder but where the offeree of the bid has or is deemed to have knowledge of the mistake, he cannot be permitted to take advantage of such a mistake.
(2) Where the bidder on discovery of the mistake fails to act promptly in informing to the concerned authority and request for rectification, withdrawal or cancellation of bid Page 20 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined on the ground of clerical mistake is not made before opening of all the bids, (3) Where the bidder fails to follow the rules and regulations set forth in the advertisement for bids as to the time when bidders may withdraw their offer; however where the mistake is discovered after opening of bids, the bidder may be permitted to withdraw the bid.
29 In the instant case, we have also noted that the mistakes in the bid documents of respondent Nos. 1 to 4 even though caused on account of faulty functioning of computer could have been discovered and notified by the said respondents with exercise of ordinary care and diligence. Here, the mistakes remained in the documents due to gross negligence in not checking the same before the submission of bid. Further clauses 24 and 27 of ITB permit modification or withdrawal of bids after bid submission but before the dead line for submissions of the bids and not thereafter. And "equity follows the law". Having submitted the bid they did not promptly act in discovering the errors and informing the same to the appellant. Though letters were written on 25.10.1999 and December 17, 1999, yet the real nature of errors/mistakes and corrections sought were not pointed out till 23.12.1999 when representation was made after interim direction of the High Court was given on 21.12.1999. Instead it appears to us that they improved their claim in the representation. In our view the said respondents are not entitled to rectification of mistakes/error for being considered along with the other bidders.
xxx xxx xxx
32. The submission that remains to be considered is that as the price bid of respondent Nos. 1 to 4 is lesser by 40 crores and 80 crores than that of respondent Nos. 11 and 10 respectively, public interest demands that the bid of respondent Nos. 1 to 4 should be considered. The project undertaken by the appellant is undoubtedly for the benefit of public. The mode of execution of the work of the project should also ensure that the public interest is best served. Tenders are invited on the basis of Page 21 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined competitive bidding for execution of work of the project as it serves dual purposes. On the one hand it offers a fair opportunity to all those who are interested in competing for the contract relating to execution of the work and on the other hand it affords the appellant a choice to select the best of the competitors on competitive price without prejudice to the quality of the work. Above all it eliminates favouritism and discrimination in awarding public works to contractors. The contract is therefore, awarded normally to the lowest tenderer which is in public interest. The principle of awarding contract to the lowest tenderer applies when all things are equal. It is equally in public interest to adhere to the rules and conditions subject to which bids are invited. Merely because a bid is the lowest the requirements of compliance of rules and conditions cannot be ignored. It is obvious that the bid of respondent Nos. 1 to 4 is the lowest of bids offered. As the bid documents of respondent Nos. 1 to 4 stands without correction there will be inherent inconsistency between the particulars given in the annexure and the total bid amount, it cannot be directed to be considered along with other bid on the sole ground of being the lowest."
31. The Supreme Court has culled out the brief principles and the exceptions to the above general principle of seeking relief in equity on the ground of 'mistake' as mentioned hereinabove. The Supreme Court has cautioned that where the mistake might have been avoided by the exercise of ordinary care and diligence on the part of the bidder; but where the offeree of the bid has or is deemed to have knowledge of the mistake, he cannot be permitted to take advantage of such a mistake.
Page 22 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined It was the case of respondent No.1 to 4 before the Supreme Court that there was mistakes in the bid documents of respondent Nos.1 to 4. The Apex Court has held that the mistake in the bid documents caused due to faulty functioning of computer could have been discovered and notified with exercise of ordinary care and diligence. The Supreme Court has refused to accept the contentions of the bidders by holding that they were not entitled to rectification of mistakes / error for being considered along with the other bidders on the principle of "equity follows the law". The petitioner ought to have acted diligently while uploading the documents such as work experience and Work Order, and thereafter should have remained vigilant since after uploading the documents 21 days is provided to submit the bids.
32. In the present case also, it is very curious to note that similar type of mistake for submitting the illegible documents was committed by the petitioner in the earlier tender in the year 2024 for the FCI, Palanpur Region and curiously the same mistake has again committed by the petitioner in the present Page 23 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined tender. In view of the specific condition of the tender, as mentioned hereinabove, the petitioner had to remain very diligent in submitting the documents and it is not the case of the petitioner that the petitioner is applying for the very first time and before finally uploading the documents, verification was required to be done at the end of the petitioner to see that the vital documents, which are mentioned hereinabove are uploaded.
33. It is interesting to note that in the afore-
noted case before the Supreme Court, the said respondents no.1 to 4 had offered the Price Bid much lessor to the respondent nos.11 and 10 to the tune of almost Rs.40 crores and Rs.80 crores, however, the Supreme Court refused to interfere in the tender process of the contract by recording that the contract though awarded normally is to the lowest tenderer, which is in public interest; however the principle of awarding contract to the lowest tenderer applies when all things are equal and it is equally in public interest to adhere to the rules and conditions subject to which bids are invited. It is further observed that merely because a bid is the lowest, the requirements Page 24 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined of compliance of rules and conditions cannot be ignored. Similarly, in the case before us, the petitioner is seeking condonation of the mistake which he has committed in uploading the vital documents on the ground of public interest.
34. Yet, in another decision in the case of Central Coalfields Limited & Anr. vs. - SML (Joint Venture Consortium) & Ors., 2016 (8) S.C.C. 622 the Supreme Court has distinguished both the aforesaid decisions in the cases of Rashmi Metaliks (supra) and Poddar Steel Corporation (supra), on which reliance is placed by the petitioner. It is held thus :
"42. Unfortunately, this Court did not at all advert to the privilege-of-participation principle laid down in Ramana Dayaram Shetty and accepted in G. J. Fernandez. In other words, this Court did not consider whether, as a result of the deviation, others could also have become eligible to participate in the bidding process. This principle was ignored in Poddar Steel.
43. Continuing in the vein of accepting the inherent authority of an employer to deviate from the terms and conditions of an NIT, and re-introducing the privilege-of-participation principle and the level playing field concept, this Court laid emphasis on the decision making process, particularly in respect of a commercial contract. One of the more significant cases on the subject is the three-Page 25 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025
NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined judge decision in Tata Cellular vs. Union of India which gave importance to the lawfulness of a decision and not its soundness. If an administrative decision, such as a (1994) 6 SCC 651 deviation in the terms of the NIT is not arbitrary, irrational, unreasonable, mala fide or biased, the Courts will not judicially review the decision taken. Similarly, the Courts will not countenance interference with the decision at the behest of an unsuccessful bidder in respect of a technical or procedural violation. This was quite clearly stated by this Court (following Tata Cellular) in Jagdish Mandal vs. State of Orissa in the following words:
"Judicial review of administrative action is intended to prevent arbitrariness, irrationality, unreasonableness, bias and mala fides. Its purpose is to check whether choice or decision is made "lawfully" and not to check whether choice or decision is "sound". When the power of judicial review is invoked in matters relating to tenders or award of contracts, certain special features should be borne in mind. A contract is a commercial transaction. Evaluating tenders and awarding contracts are essentially commercial functions. Principles of equity and natural justice stay at a distance. If the decision relating to award of contract is bona fide and is in public interest, courts will not, in exercise of power of judicial review, interfere even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. The power of judicial review will not be permitted to be invoked to protect private interest at the cost of public interest, or to decide contractual disputes. The tenderer or contractor with a grievance can always seek damages in a civil court. Attempts by unsuccessful tenderers with imaginary grievances, wounded pride and business rivalry, to Page 26 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade courts to interfere by exercising power of judicial review, should be resisted. Such interferences, either interim or final, may hold up public works for years, or delay relief and (2007) 14 SCC 517 succour to thousands and millions and may increase the project cost manifold." This Court then laid down the questions that ought to be asked in such a situation. It was said:
"Therefore, a court before interfering in tender or contractual matters in exercise of power of judicial review, should pose to itself the following questions:
(i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone;
OR Whether the process adopted or decision made is so arbitrary and irrational that the court can say: "the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached";
(ii) Whether public interest is affected.
If the answers are in the negative, there should be no interference under Article
226."
44. On asking these questions in the present appeals, it is more than apparent that the decision taken by CCL to adhere to the terms and conditions of the NIT and the GTC was certainly not irrational in any manner whatsoever or intended to favour anyone. The decision was lawful and not unsound.
45. Rashmi Metaliks was a comparatively different case inasmuch as clause (j) of the Page 27 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined NIT was the subject matter of consideration. This clause required a bidder to submit "Valid PAN No., VAT No., copy of acknowledgment of latest income tax return and professional tax return." The employer interpreted this to be an essential term for qualifying in the bidding process. This view was upheld by a learned Single Judge and the Division Bench of the Calcutta High Court. This Court reversed in the following words:
"We think that the income tax return would have assumed the character of an essential term if one of the qualifications was either the gross income or the net income on which tax was attracted. In many cases this is a salutary stipulation, since it is indicative of the commercial standing and reliability of the tendering entity. This feature being absent, we think that the filing of the latest income tax return was a collateral term, and accordingly the Tendering Authority ought to have brought this discrepancy to the notice of the appellant Company and if even thereafter no rectification had been carried out, the position may have been appreciably different." Essentially therefore, this Court substituted its view for that of the employer who interpreted this term of the NIT to be mandatory for compliance. Rashmi Metaliks followed Poddar Steel and apparently overlooked the dictum laid down in Ramana Dayaram Shetty, G. J. Fernandez, Tata Cellular and Jagdish Mandal and must be confined to its own peculiar facts. In any event, this decision does not advance the case of any of the parties before us.
46. It is true that in Poddar Steel and in Rashmi Metaliks a distinction has been drawn by this Court between essential and ancillary and subsidiary conditions in the bid documents. A similar distinction was adverted to more Page 28 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined recently in Bakshi Security and Personnel Services Pvt. Ltd. vs. Devkishan Computed Pvt. Ltd. through a reference made to Poddar Steel. In that case, this Court held a particular term of the NIT as essential (confirming the view of the employer) and also referred to the "admonition" given in Jagdish Mandal followed in Michigan Rubber (India) Limited v. State of Karnataka.9 Thereafter, this Court rejected the challenge to the employer's decision holding Bakshi Security and Personnel Services ineligible to participate in the tender.
47. The result of this discussion is that the issue of the acceptance or rejection of a bid or a bidder should be looked at not only from the point of view of the unsuccessful party but also from the point of view of the employer. As held in Ramana Dayaram Shetty the terms of the NIT cannot be ignored as being redundant or superfluous. They must be given a meaning and the necessary significance. As pointed out in Tata Cellular there must be judicial restraint in interfering with administrative action. Ordinarily, the soundness of the decision taken by the employer ought not to be questioned but the decision making process can certainly be subject to judicial review. The 2016 (7) SCALE 425 (2012) 8 SCC 216 soundness of the decision may be questioned if it is irrational or mala fide or intended to favour someone or a decision "that no responsible authority acting reasonably and in accordance with relevant law could have reached" as held in Jagdish Mandal followed in Michigan Rubber.
48. Therefore, whether a term of the NIT is essential or not is a decision taken by the employer which should be respected. Even if the term is essential, the employer has the inherent authority to deviate from it provided the deviation is made applicable to all bidders and potential bidders as held in Ramana Dayaram Shetty. However, if the term is held by the Page 29 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined employer to be ancillary or subsidiary, even that decision should be respected. The lawfulness of that decision can be questioned on very limited grounds, as mentioned in the various decisions discussed above, but the soundness of the decision cannot be questioned, otherwise this Court would be taking over the function of the tender issuing authority, which it cannot.
49. Again, looked at from the point of view of the employer if the Courts take over the decision-making function of the employer and make a distinction between essential and non- essential terms contrary to the intention of the employer and thereby re-write the arrangement, it could lead to all sorts of problems including the one that we are grappling with. For example, the GTC that we are concerned with specifically states in Clause 15.2 that "Any Bid not accompanied by an acceptable Bid Security/EMD shall be rejected by the employer as non-responsive." Surely, CCL ex facie intended this term to be mandatory, yet the High Court held that the bank guarantee in a format not prescribed by it ought to be accepted since that requirement was a non- essential term of the GTC. From the point of view of CCL the GTC has been impermissibly re- written by the High Court."
It is held by the Supreme Court that issue of the acceptance or rejection of a bid or a bidder should be looked at not only from the point of view of the unsuccessful party but also from the point of view of the employer. While referring to the decision in the case of Tata Cellular vs. Union of India, 1994 6 S.C.C. 651, which has been followed in the case of Page 30 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined Jagdish Mandal vs. State of Orissa, 2007 14 S.C.C. 517, it is held that ordinarily, the soundness of the decision taken by the employer ought not to be questioned, but the decision making process can certainly be subject to judicial review, and the soundness of the decision may be questioned if it is irrational or mala fide or intended to favour someone or a decision "that no responsible authority acting reasonably and in accordance with relevant law could have reached". It is further held that even if the term is held by the employer to be ancillary or subsidiary, even that decision should be respected.
35. While distinguishing the aforesaid judgments in the cases of Rashmi Metaliks (supra) and Poddar Steel Corporation (supra), it is held that from the point of view of the employer if the Courts take over the decision-making function of the employer and make a distinction between essential and non-essential terms contrary to the intention of the employer and thereby re- write the arrangement, it could lead to all sorts of problems including the one that was considered by the Supreme Court. In that case, the Supreme Court was dealing with the Page 31 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined documents relating to the Bank Guarantee which was essential requirement in the bidding process which remained non-complied. The Bank Guarantee which was furnished by the bidder, was not in prescribed format. The Supreme Court thus upheld the decision of the employer in similar case.
36. The petitioner has primarily placed reliance on Clause No.7.3.5 of the Clarification of Bids / Shortfall Documents of the Manual for Procurement of Goods, 2017 issued by the Ministry of Finance, Department of Expenditure displayed on the GeM Portal. The relevant part, which is urged upon is "During the evaluation and comparison of bids, the purchaser may, at his discretion, ask the bidder for clarifications on the bid. The request for clarification shall be given in writing by registered/ speed post, asking the tenderer to respond by a specified date, ... ... ..." The petitioner has also placed reliance on the Government of India (Ministry of Finance Department of Expenditure) in Manual Procurement of Goods, Second Addition, 2024, more particularly Clause 7.3.4 - Paragraph Nos.5 and 6, which read that "... ... ... The Page 32 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined procuring Entity reserves the right to accept bids such with minor issues provided they do not constitute any substantive deviation, do not have a fiscal impact, do not prejudice, or affect the ranking order of the bidders and do not grant the bidder undue advantage vis-à-vis other bidders and the Procuring entity ... ... ...". Clause-6 of the Technical Bid (Part-A) clarifies that "The Terms and Conditions stipulated in the tender form (MTF) shall prevail over the General Terms & Conditions (GTC) of GeM Portal".
37. We do not think the foregoing clauses will come to the rescue of the petitioner in view of the specific manual of the respondent-FCI approved by its Board of Directors on 28.05.2024, which has been followed by the FCI. Clause 3.10 of the said Manual has already been discussed by us. The respondent-FCI, in its discretion, has refused to invoke Clause 3.10 in view of the illegible documents submitted by the petitioner. We are of the view that the Technical Bid of the petitioner cannot be said to have been disqualified on frivolous / hyper- technical ground, but it can be firmly held that it has been disqualified on material ground.
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38. In the present case, the respondent-FCI has placed reliance upon Clause-3.10 of the FCI Manual dated 01.07.2024. The TEC has referred to the aforesaid clause, which reads thus:
"3.10 Seeking Additional documents Tender Awarding Authority reserves the right to disqualify the bid as per Terms & Conditions and no request for alteration, modification, substitution or withdrawal shall be entertained by the Authority in respect of such bid. Provided, however, that the Authority may, in its absolute discretion, allow the bidder to rectify any infirmities or omission in form of the clarification only against the information submitted, if the same do not constitute a modification of the bid save to the extent of the aforesaid clarification.
For Example - Clarification can be sought from the bidders for the documents which already exists and submitted in the bid like missing signatures on few pages, anomalies due to different spellings of name, surname, places, missing pages etc. The bids should be disqualified on material grounds only. The rejection of bids on frivolous/Hyper- technical grounds should be avoided."
The recital of Clause-3.10 exposits that it is in the discretion, to allow the bidder to rectify any infirmities or omission in form of the clarification only against the information submitted, if the same do not constitute a modification of the bid save to the extent of the aforesaid clarification. The petitioner has tried to impress upon this Court by placing reliance on the procedure adopted by the Page 34 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined respondent-FCI in the earlier bidding process of FSD, Palanpur Region, wherein the respondent-FCI allowed the petitioner to submit some illegible documents in the bidding process.
39. In the present case, the respondent-FCI in its wisdom has refused to follow the earlier process by considering importance and mandatory nature of the documents, which the petitioner was supposed to submit in the legitimate format. The Committee also opined that allowing such conduct would undermine the integrity and fairness of the bidding process and would set a negative precedent. It was also expressed by the Committee that benefit of doubt was already extended to the petitioner (bidder) in a previous case, and it cannot be allowed again for repeated non-compliance. This Court cannot either alter or substitute or venture into the satisfaction or discretion exercised by the respondent-FCI as per Clause 3.10 of the FCI Manual dated 01.07.2024 unless it is tainted with mala fide or is profoundly arbitrary. The TEC / Committee, after threadbare analysis of the requirement of the documents and their vital importance in the bidding process, has Page 35 of 36 Uploaded by BHAVESH P. KATIRA(HC00176) on Fri Jun 20 2025 Downloaded on : Fri Jun 20 23:45:14 IST 2025 NEUTRAL CITATION C/SCA/7528/2025 JUDGMENT DATED: 16/06/2025 undefined rejected the representation of the petitioner. Hence, this Court can neither compel the respondent-FCI to take a contrary stand to its discretion nor issue any direction to adopt the same process as was done in the earlier case by stepping into its shoes. The comparison of importance and mandatory nature of documents in both the cases is in the absolute domain of the FCI, and this Court cannot delve into such issue which has direct bearing on the commercial transaction. It is not alleged by the petitioner that the respondent-FCI has acted in mala fide manner. Hence, on an overall analysis and appreciation of the facts, we are not inclined to tinker with the tender process even if the Price Bid of the petitioner is less than the respondent No.2-M/s.K.B. Enterprise.
40. For the foregoing reasons, the present petition stands dismissed. RULE is discharged. There shall be no order as to costs.
Sd/- .
(A. S. SUPEHIA, J)
Sd/- .
(R. T. VACHHANI, J)
***
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