1990 (2) TMI 310 - SC - Indian Laws

Supreme Court affirms K.P.C.'s contract award decision to M.C.C. Discretion upheld on document sufficiency.

The Supreme Court upheld the decision of the High Court, ruling that Karnataka Power Corporation Ltd. (K.P.C.) did not act arbitrarily or unfairly in ... - Issues Involved:1. Whether the Karnataka Power Corporation Ltd. (K.P.C.) should have entertained the tender of Mysore Construction Co. (M.C.C.) despite alleged non-fulfillment of preliminary requirements.2. Whether the requirements in paragraphs I and V of the Notification Inviting Tenders (N.I.T.) should be considered separately or together.3. Whether the K.P.C. acted arbitrarily or unfairly in awarding the contract to M.C.C.4. Whether the delayed submission of documents by M.C.C. affected their eligibility to tender.Summary:Issue 1: Entertaining the Tender of M.C.C.The petitioner argued that K.P.C. should not have entertained M.C.C.'s tender as M.C.C. did not fulfill certain preliminary requirements specified in the N.I.T. The High Court concluded that the pre-requisites for the supply of tender forms were only the three conditions set out in para I of the N.I.T. and that the details called for in para V could be supplied at any time. The Supreme Court agreed with the High Court's view that the K.P.C. had the discretion to assess the sufficiency of the certificates provided by M.C.C.Issue 2: Interpretation of Paragraphs I and V of N.I.T.The Supreme Court found it difficult to accept the view that only para I stipulates the pre-conditions and that all documents referred to in para V can be supplied at any time. The Court held that paragraphs I and V should be read together as they are meant to supplement each other. Some of the documents referred to in para V are intended to verify the fulfillment of the three prequalifying requirements of para I and should be supplied along with the application for tender forms.Issue 3: Arbitrary or Unfair Award of ContractThe Division Bench of the High Court observed that it is not for the Court to reappraise the facts on merits if the authority awarding the contract was satisfied about the eligibility of the tenderer after consultancy through an independent agency. The Supreme Court agreed, stating that the K.P.C.'s decision should not be interfered with if it was based on a reasonable assessment of the certificates furnished by M.C.C.Issue 4: Delayed Submission of DocumentsThe petitioner contended that M.C.C. should have been denied the right to tender due to the delayed submission of certain documents. The Supreme Court noted that the delay in submitting the details regarding 'hollow cement blocks' was considered by K.P.C. to be of no importance in judging the pre-qualifying requirements. The Court also emphasized that the K.P.C. had consistently interpreted the standards prescribed by it in a particular manner and that this interpretation should not be interfered with by the Court.Conclusion:The Supreme Court dismissed the appeal, concluding that the K.P.C. did not act arbitrarily or unfairly in awarding the contract to M.C.C. and that the High Court was right in declining to interfere. The appeal was dismissed with no order as to costs.