A) ABSTRACT / HEADNOTE

This case revolves around the rejection of a technical bid submitted by the appellant, Banshidhar Construction Pvt. Ltd., in a tender floated by Bharat Coking Coal Limited (BCCL) for a mega coal excavation project. The dispute emerged from alleged violations of tender conditions under Clause 10 of the Notice Inviting Tender (NIT), concerning mandatory documentation. The respondent’s decision to accept the bid of another party, despite its non-compliance with mandatory requirements, was challenged for arbitrariness and violation of Article 14 of the Constitution. The Supreme Court adjudicated on fairness, transparency, and the government’s obligations in contractual matters.

Keywords:

Tender, Technical Bid, Judicial Review, Arbitrariness, Article 14, Mega Project, NIT.

B) CASE DETAILS

• i) Judgment Cause Title: Banshidhar Construction Pvt. Ltd. v. Bharat Coking Coal Limited & Others
• ii) Case Number: Civil Appeal No. 11005 of 2024
• iii) Judgment Date: 04 October 2024
• iv) Court: Supreme Court of India
• v) Quorum: Justices Bela M. Trivedi and Satish Chandra Sharma
• vi) Author: Justice Bela M. Trivedi
• vii) Citation: [2024] 10 S.C.R. 425
• viii) Legal Provisions Involved: Article 14 of the Constitution of India, Clause 10 of NIT, Power of Attorney Act, 1882
• ix) Judgments Overruled by the Case: None
• x) Case is Related to: Public Contracts, Constitutional Law, Administrative Law

C) INTRODUCTION AND BACKGROUND OF JUDGMENT

The appellant challenged the rejection of its bid under the grounds of Clause 10 of the NIT, which mandates submission of specific financial and authorization documents. The appellant submitted its bid along with notarized Power of Attorney but was disqualified for alleged procedural non-compliance. Conversely, Respondent No. 8, despite failing to submit mandatory financial documents on time, was declared successful. The High Court upheld the rejection of the appellant’s bid, prompting an appeal to the Supreme Court.

D) FACTS OF THE CASE

1. Tender Process: BCCL issued a tender for coal mine development and operations in 2023. The appellant and others, including Respondent No. 8, participated.
2. Appellant’s Compliance: The appellant submitted a duly authorized Power of Attorney before the bid submission deadline, along with other necessary documents.
3. Respondent No. 8’s Non-compliance: Despite failing to submit audited balance sheets on time, Respondent No. 8 was allowed to furnish the documents post the opening of technical bids.
4. High Court Ruling: The High Court dismissed the appellant’s writ petition challenging this decision.

E) LEGAL ISSUES RAISED

• i. Was the rejection of the appellant’s bid under Clause 10 of NIT justified?
• ii. Was the acceptance of Respondent No. 8’s bid, despite non-compliance, valid?
• iii. Did the respondent’s actions violate principles of fairness and Article 14?

F) PETITIONER/APPELLANT’S ARGUMENTS

1. Compliance with NIT: The appellant argued that all requisite documents, including a notarized Power of Attorney, were submitted before the deadline.
2. Arbitrariness: The appellant contended that the rejection was discriminatory, especially since Respondent No. 8 was allowed to cure deficiencies post-deadline.
3. Public Interest: The appellant asserted that its bid offered a more competitive financial advantage and better aligned with public interest.

Relevant Case Law:

• Sterling Computers Limited v. M & N Publications Limited (1993) 1 SCC 445: Established the principle of fair decision-making in government contracts.
• ABL International Ltd. v. Export Credit Guarantee Corporation (2004) 3 SCC 553: Mandated adherence to fairness and transparency in contractual obligations.

G) RESPONDENT’S ARGUMENTS

1. Technical Compliance: Respondents claimed the appellant’s bid was invalid as the Power of Attorney was notarized after the execution of bid documents.
2. Discretion to Evaluate: The Respondent argued that Clause 10 allowed discretion in seeking clarification on documents submitted.
3. Infrastructure Project: Judicial interference should be minimal given the project’s national importance.

Relevant Case Law:

• Tata Cellular v. Union of India (1994) 6 SCC 651: Limits judicial review to the decision-making process, not the merits of the decision.

H) JUDGMENT

a. RATIO DECIDENDI

1. Principle of Transparency: The rejection of the appellant’s bid and the acceptance of Respondent No. 8’s bid violated Clause 10 of NIT, breaching transparency and fairness.
2. Bias and Arbitrariness: Disparate treatment of bidders indicated arbitrariness, contravening Article 14.
3. Non-Compliance of Respondent No. 8: Submission of audited financial reports after bid opening was impermissible.

b. OBITER DICTA

The Court reiterated that government contracts must uphold constitutional mandates of fairness and non-discrimination.

c. GUIDELINES

• Adherence to NIT: Mandated strict compliance with all tender conditions to ensure transparency.
• No Post-Submission Rectification: Bars post-deadline submission of critical documents unless uniformly applied.
• Judicial Review Scope: Courts may intervene where arbitrariness or bias is evident.

I) CONCLUSION & COMMENTS

The judgment underscores the judiciary’s role in enforcing transparency in public contracts. The Court invalidated the tender award, directing BCCL to initiate a fresh process adhering to tender conditions and constitutional principles.

J) REFERENCES

a. Important Cases Referred

1. Sterling Computers Ltd. v. M & N Publications Ltd., (1993) 1 SCC 445
2. Tata Cellular v. Union of India, (1994) 6 SCC 651
3. ABL International Ltd. v. Export Credit Guarantee Corporation, (2004) 3 SCC 553
4. Jagdish Mandal v. State of Orissa, (2007) 14 SCC 517

b. Important Statutes Referred

1. Article 14, Constitution of India
2. Power of Attorney Act, 1882