TaxTMI 
TaxTMI 
2023 (5) TMI 1253
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of SLP(C) No. 11933 of 2022 is at the instance of the Brihan Mumbai Electric Supply & Transport Undertaking (for short, "BEST") (Original respondent No. 1 before the High Court), a statutory corporation operating under the provisions of the Mumbai Municipal Corporation Act, 1888. FACTUAL MATRIX 6. BEST floated a tender bearing No. DMM(T-II)/08/TCU/73169/2021- 2022/Advt. dated 26.02.2022 for the supply, operation and maintenance of 1400 (+50% variation) Single Decker AC Electric Buses with driver, for the purpose of public transport service within the city of Mumbai along with other civil infrastructure development at the BEST depots for a period of 12 years (hereinafter referred to as, 'the Tender'). 7. The Tender document provided for Technical specifications as stipulated under Clause 3.5(e) and Clause 12 of Section 2 of Schedule IX, under which the bidders were required to provide Single Decker Buses which can run 200 Kms in single charge without interruption in actual conditions for the relevant Gross Vehicle Weight (GVW) with air conditioning with not more than 80% battery being consumed. Clause 3.5(e) and Clause 12 respectively are reproduced hereunder: "SCHEDULE....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... operating range of the buses, was not required to be submitted along with the bid but was only required to be submitted by the successful bidder. The purpose of the undertakings under Clause 3.5 (e) and Clause 12 of Section 2 of Schedule IX (Technical Specifications) and Annexure Y is to confirm that the requirement of meeting the 200 Kms range in single charge is satisfied. 14. EVEY along with its bid dated 02.05.2022 submitted Annexure Y, wherein the OEM gave an undertaking for the operating range which included a table that mentioned that the operating range for a single decker bus would be 200 Kms with the opportunity charging time of 1 hour. The same was done in accordance with the specifications of the earlier tender dated 20.08.2021, which allowed for an opportunity time of 60 minutes. 15. EVEY vide email dated 06.05.2022, provided a revised Annexure Y as per the Single Charge Requirements mentioned in the Tender along with an explanation for the same holding it to be a mere "clerical error". 16. The Tender bids were opened on 04.05.2022 and the technical suitability evaluation was announced on 06.05.2022. BEST in its technical suitability evaluation dated 06.05.20....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rit, order or direction under Article 226 of the Constitution of India directing Respondent Nos. 1 to cancel the Tender and float a fresh tender; (d) During the pendency of the Petition, restrain Respondent No. 1 from taking any steps towards award of contract under the Tender; (e) ad-interim reliefs in terms of prayers in clause (d) above; (f) Cost of the present Petition; and (g) such further and other reliefs as the nature and the circumstances of the case may require be granted to the Petitioner." 20. During the pendency of the aforesaid writ petition BEST awarded the Tender in favour of EVEY with the Letter of Acceptance dated 20.05.2022. EVEY accordingly submitted the required Performance Bank Guarantee on 23.05.2022. An agreement for operation of Stage Carriage Services for public transport of Single Decker AC Electric Buses with Driver in the city of Mumbai and its extended suburbs on Gross Contract Cost (GCC) model for 12 years was entered into between the EVEY and BEST on 26.05.2022. 21. A subsidy bank guarantee dated 02.06.2022 was submitted by EVEY and BEST released the requisite amount to the EVEY's account towards subsidy on 1....
X X X X Extracts X X X X
X X X X Extracts X X X X
....es, there can be no additions/corrections/ submissions of documents by the bidders. Clause 16 of Schedule I of the Tender is produced hereinbelow: "SCHEDULE I Invitation for Proposal .... 16. Interested Bidders are advised to study this Tender document carefully before submitting their proposal in response to this Tender document. Submission of a proposal in response to this tender shall be deemed to have been after careful study and examination of this document with full understanding of its terms, conditions and implications. No addition / correction, submission of documents will be allowed after opening of technical bid" 24. The High Court as a result, held that the email dated 06.05.2022 ought not to have been entertained, and the technical bid evaluation, which was released on the same day did not depict fairness in the actions of BEST. The High Court in paragraphs 20 - 22 respectively held as under: "20. It has been contended by Respondent No.1 that letter issued by Respondent No.2 on 6th morning did not influence the decision to hold the bid of Respondent No.2 responsive in the afternoon of 6th May 2022. The same is not borne-out from the facts and....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n unsuccessful bidder. The High Court in paragraphs 23 and 24 respectively held as under: "23. We are aware that the principle of equity and natural justice stay at a distance and no judicial interference is warranted in case of an error in assessment. However, the same holds good, if the decision is bona fide. We are also aware that interference of the Court would lead to some delay. It would be seen that earlier also the tenders were issued. However, because of non-sanction of subsidy, the earlier tender process was scrapped and fresh tender process was issued. For accepting the bid of Respondent No.2, 90 days' time is provided to it for getting the prototype vehicle. The said period is not over. It is not even one month. The Respondent No.2's tender is accepted. The Courts upon coming to the conclusion that the decision making process was not fair. The same lacked fair play in action and arbitrary, will have to step in. 24. In the light of the above, we set aside the decision of the Respondents of acceptance of tender of Respondent No.2. Respondent No.1, if it so desires, may proceed with a fresh tender process." (Emphasis supplied) 26. In such ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sults in rejection of the tender, then it would be an essential part of the tender otherwise it is only a collateral term. He further submitted that, non-compliance of the conditions mentioned in Annexure Y would lead to levy of penalty and if the instance keeps on recurring, it may lead to termination of contract and therefore, Annexure Y should be treated as a collateral term of the Tender. Under Clause 5.1.1 of Schedule II (Definitions and Instructions to Bidders) of the Tender document Annexure Y was not required to be submitted along with the bid documents but the same was to be submitted by the "Successful Bidder''. 30. He submitted that, in view of the decision of this Court in, N.G. Projects Limited v. Vinod Kumar Jain and Others, reported in (2022) 6 SCC 127, the writ court should refrain itself from imposing its decision over the decision of the employer as to whether to accept the bid of a tenderer and that contract of public service should not be interfered with lightly. The injunction or interference in the Tender leads to additional costs on the State and is also against public interest. 31. He submitted that the allegations of favouritism levelled by TA....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ld be granted to tender processes tainted with malice. The learned Senior counsel relied upon the decision of this Court in Monarch Infrastructure (P) Ltd v. Commissioner, Ulhasnagar Municipal Corporation and Others, reported in (2000) 5 SCC 287 (Paras 10 and 14); Meerut Development Authority v. Association of Management Studies and Another, reported in (2009) 6 SCC 171 (Paras 27, 28, 45 and 76); Maa Binda Express Carrier and Another v. North-East Frontier Railway and Others, reported in (2014) 3 SCC 760 (Paras 8, 9 and 12) to fortify the submission. 36. He argued that the High Court in paragraph 19 of the impugned judgment has rightly observed that the battery range guarantee can be given only by the OEM from whom the bidder is purchasing the battery, and in such circumstances, the same cannot be said to be incidental. The same was considered as an important part of the technical evaluation by BEST. 37. He vociferously submitted that Annexure Y was a part of the bid document and once submitted, could not have been permitted to be altered after the bid submission end date i.e., 02.05.2022. The argument that Annexure Y was optional and not required at the time of submission of....
X X X X Extracts X X X X
X X X X Extracts X X X X
....iding for Annexure F was a mandatory condition for being qualified as a bidder at the Technical Bidding stage. The mandatory requirement reads as under: 42. He submitted that TATA Motors deviated from the mandatory requirement while filing the said Annexure F. He highlighted the portion of the Annexure which states that if variations are found contradicting BEST's requirements then such bids would be treated as non-responsive. The non- compliant deviation was as under: "Shall meet the operating range requirement of 200 KMS @ 80% SOC in single charge as certified per AIS 040." 43. He submitted that none of the bidders including EVEY (successful bidder) deviated from this mandatory condition. Hence, TATA Motors was declared a non-responsive bidder at the technical stage itself. On 06.05.2022, BEST undertook the technical evaluation and took a decision that of all the bidders found eligible and responsive, EVEY had quoted the lowest rates and accordingly the contract was awarded in its favour. 44. The learned SG further submitted that the successful bidder was required to fill up Annexure Y. However, Annexure Y was neither a condition precedent for being a responsive....
X X X X Extracts X X X X
X X X X Extracts X X X X
....interference in commercial matters can cause. In contracts involving technical issues the courts should be even more reluctant because most of us in Judges' robes do not have the necessary expertise to adjudicate upon technical issues beyond our domain. The courts should not use a magnifying glass while scanning the tenders and make every small mistake appear like a big blunder. In fact, the courts must give "fair play in the joints" to the government and public sector undertakings in matters of contract. Courts must also not interfere where such interference will cause unnecessary loss to the public exchequer. (See: Silppi Constructions Contractors v. Union of India, (2020) 16 SCC 489) 49. It is not in dispute that the first and the foremost requirement of the Tender was the prescribed operating range of the single decker buses which would operate for around and average of 200 Kms in a single charge in "actual conditions" with 80% SoC without any interruption. Then materials on record would indicate that the TATA Motors in its bid deviated from this requirement and had informed BEST that it could carry the operating range in the "standard test conditions" which was not in a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n of two thermal power units, each of 210 MW, is held up on account of this dispute. Shortages of power have become notorious. They also seriously affect industrial development and the resulting job opportunities for a large number of people. In the present case, there is no overwhelming public interest in stopping the project. There is no allegation whatsoever of any mala fides or collateral reasons for granting the contract to M/s. Raunaq International Ltd." (Emphasis supplied) 50. We take notice of the fact that Annexure Y was originally required to be submitted by the "Successful Bidder" after the evaluation of the bid and the same did not figure in the list of documents and annexures to be included in the technical submissions, as provided under Clause 5.1.1 of Schedule II of the Tender. Further the format provided for Annexure Y in the Tender documents in its heading states that the "Successful Bidders shall upload a Letter of Undertaking on their letter head as below". Therefore, we are of the view that the restriction on revision of documents under Clause 16 of Schedule I, which states, "No addition/correction, submission of documents will be allowed after opening of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tion and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the court should interfere. 54. As observed by this Court in Jagdish Mandal v. State of Orissa and Others, reported in (2007) 14 SCC 517, that while invoking power of judicial review in matters as to tenders or award of contracts, certain special features should be borne in mind that evaluations of tenders and awarding of contracts are essentially commercial functions and principles of equity and natural justice stay at a distance in such matters. If the decision relating to award of contract is bona fide and is in public interest, courts will not interfere by exercising powers of judicial review even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. Power of judicial review will not be invoked to protect private interest at the cost of public interest, or to decide contractual disputes. 55. In such ci....