Tender eligibility in sensitive defence procurement upheld where pending investigation disqualified the bidder.

Tender conditions in defence procurement and sensitive research work were upheld where the State required bidders to declare that no enquiry was pending with CBI, ED or any other agency. In reviewing such eligibility criteria, the court applied a limited standard and examined only whether the condition was arbitrary, discriminatory, mala fide, biased or otherwise unreasonable. The condition was treated as a legitimate measure to preserve integrity in national security procurement and was not held violative of Article 14 merely because it excluded bidders facing pending investigations. On the facts, circumstances linking the bidder to concerns arising from the predecessor entity and alleged proceeds of crime supported rejection of the bid.

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Issues: Whether the tender condition requiring an undertaking that no enquiry was pending by CBI, ED or any other government agency, and the rejection of the petitioner's bid on account of a pending ED enquiry, were arbitrary, discriminatory or otherwise illegal.

Analysis: The tender related to defence procurement and critical research work involving national security, in which the State is entitled to a wider latitude in fixing eligibility conditions. Judicial review in such matters is confined to examining whether the condition is arbitrary, discriminatory, mala fide, biased or otherwise unreasonable. The impugned condition was aimed at preserving integrity in sensitive procurement and could not be termed violative of Article 14 merely because it excluded bidders facing pending investigations. The record also showed circumstances linking the petitioner with the concerns arising from the predecessor entity and alleged proceeds of crime, which supported the respondents' decision to exclude the petitioner from the bid process.

Conclusion: The tender condition was upheld and the rejection of the petitioner's bid was found justified.

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