Supreme Court affirms disqualification in tender process; emphasizes judicial restraint in commercial matters.

The Supreme Court upheld the disqualification of TATA Motors from the tender process for deviating from material requirements. It found that EVEY's revised Annexure Y, submitted after bid opening, was permissible as it did not form part of the technical bid documents. The Court set aside the High Court's direction for a fresh tender process, emphasizing judicial restraint in commercial matters. The appeals by EVEY and BEST were allowed, confirming the tender awarded to EVEY and highlighting the importance of avoiding unnecessary interference to prevent financial loss to the public exchequer.

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Issues Involved:

1. Whether the disqualification of TATA Motors from the tender process was justified.
2. Whether the acceptance of EVEY's revised Annexure Y after the bid submission deadline was lawful.
3. Whether the High Court was justified in directing BEST to undertake a fresh tender process.

Summary:

Disqualification of TATA Motors:

The High Court upheld the disqualification of TATA Motors, noting that the tender required the buses to run 200 Kms in a single charge under "actual conditions" with 80% State of Charge (SoC). TATA Motors deviated from this requirement by referencing "standard test conditions as per AIS 040" instead of actual road conditions. The High Court stated, "The prima donna requirement of the tender document it appears is that the electric vehicle offered should run 200 Kms in a single charge for Single Decker air conditioning bus in actual conditions with 80% SoC without any interruption." Consequently, TATA Motors was rightly disqualified for deviating from the material requirements stipulated in the tender.

Acceptance of EVEY's Revised Annexure Y:

The High Court found that EVEY's revised Annexure Y, submitted after the technical bid opening, should not have been entertained as it violated Clause 16 of Schedule I of the Tender, which prohibits additions or corrections after the opening of technical bids. The High Court held, "The facts create doubt about, whether the decision was a fair one or was the decision reached fairlyRs. The same does not appear to be so in view of the facts discussed above while accepting the bid of Respondent No.2 as responsive." However, the Supreme Court noted that Annexure Y was originally required to be submitted by the "Successful Bidder" after the evaluation of the bid and did not form part of the technical bid documents. The Court stated, "We are of the view that the restriction on revision of documents under Clause 16 of Schedule I...is only limited to the documents necessary to be included in the technical bid and would not be applicable to any such document which does not form a part of the technical bid."

Fresh Tender Process:

The High Court directed BEST to undertake a fresh tender process, stating that the technical evaluation did not depict fairness. The Supreme Court, however, held that the High Court should not have reversed the action of BEST in permitting EVEY to submit a revised Annexure Y and that the decision to allow EVEY to correct a clerical error did not render the entire bid unlawful. The Court emphasized the need for judicial restraint in commercial matters and noted, "To set at naught the entire tender process at the stage when the contract is well underway, would not be in public interest." The Supreme Court set aside the High Court's direction for a fresh tender process, allowing the appeals filed by EVEY and BEST.

Conclusion:

The Supreme Court dismissed the appeal filed by TATA Motors and allowed the appeals filed by EVEY and BEST, thereby upholding the tender awarded to EVEY. The Court emphasized the importance of judicial restraint in commercial matters and the need to avoid unnecessary interference that could result in financial loss to the public exchequer.

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