The High Court · 2025

Judgment

(Per Hon'ble Smt. Justice Renuka Yara) Heard Sri T.Rajinikanth Reddy, learned Additional Advocate General appearing for the appellants ald Sri Tarun G Reddy' learned counsel for respondent Nos. 1 and 2- Perused the record'

2. This is an intra-court appeal frled by the appellants/ respondent Nos.l and 2 aggrieved by the order dated 28'lO '2024 passed in W.P.No.21975 of 2024 by the learned Single Judge of this Court declaring the action of the appellants/respondent Nos' 1 and 2 in rejecting the tender bid of the respondents/writ petitioners in respect of tender No.TGMDC/ S&M / DSLT/ JB I 2024 I 225, dated 14'06'2024 for de-siltation of 6,00,283.55 MT of sand from Mahadevpur 12024 /2 sand reach at Jayashankar Bhupalpally District as illegal for not assigning reasons, the award of tender No'TGMDC/S&M/DSLT/ JB|2O24/225, dated 14.06 -2024 in favotrr of respondent No'3 has been set aside and the writ appellants are directed to call for fresh bids in respect of tender No'TGMDC/S&M/DSLT/JB 120241225' dated 14.06.2024.

3. The background facts of the case are that the writ appellant No.2 Y1ated tender No'TGMDC/S&M/DSLT/JB I 2024 I 225' dated 2

14.06.2024 for ,1e-siltation of 6,0O,283.55 MT ,:f r.and from Mahadevpur/ 2024 l2 sald reach at Jayashar-rkar E hupalpally District and that t he said tender was floated for a contra:t value of approximatelv Rr;5,82,27,5041-. Respondent No. 1 reprt sented by respondent No.2 zLnd respondent No.3 participated in tht bid. The bid was awarded in favour of respondent No.3 as per the a.vard dated 19 .O7 .2024 . Th r: bid submitted by respondent No. t has been rejected as per the information provided in the Telangana e-procurement pcrtal.

4. 'lhe rejectio r of their bid is challenged by resportrlent Nos.l and 2 on the premise that the u,rit appellants did not conciuct the tender process and au'ar <ling of the tender in fair and transltare,rt manner by referring to th,: legal ratios laid down by the llon'blt. Supreme Court of lndia :n Dharmapal Satgapal Limited t,. Deputg Commissioner ol' Central Excise, Go:uho,ti and othersl, pKF Sridhar and. Santharr.o;m a. Airports Economic Regulatory Authoritg oj Inatia (WP(C) No.723a5 of 2027), Swadeshi Cotton Mills u. Union ctf India2 and punjab State pouer Co,rporation Limited and. another u. EMTA Coal Limited and other#. Respondent Nos. L and 2 primarily questioned the acti<,n of writ appellants in rejrr:ting the tender without assigning rez.sons and ' lzotsls scc sts ' atR t98t scc sla ' lzozzlz scc t 3 without giving them hearing for giving clarifrcation on their Work Done Certihcate. The learned single Judge allowed the writ petition referring to various judgments of the Hon'ble Supreme Court of India holding that decision making process adopted by the writ appellants is contrary to principles of natura'l justice and lacking in transparency in the tender process' It is held that no reason is assigned for rejecting respondent No. 1's bid as failing to have fulfilled clause 3.2 tender conditions. In the light of the respondent No'l's specihc case that it fulfrlled the requirement under clause 3.2 of the tender conditions. It is held that as per the entry made in e-procurement web portal on L9.O7 -2024, the writ appellants have clearly observed that respondent No. t has fulfilled the eligibility criteria referring to the contents of Remarks column which are extracted and produced below: Remarks AS r Tender DocumenI

5. Further, the learned Single Judge held that the writ appellants have failed to give arr opportlrnity to respondent No' 1 to give clarification in case of any ambiguity about the contents of the Work Done Certifrcate. Lastly, the learned Single Judge also referred to the writ appellants issuing Letter of Intent to respondent No'3 on 1O.O7.2024 and the award of tender to respondent No'3 took place on ;\ 4

79.07.2024. Thus, the writ petition was allowed leading o hling of the writ appeal

6. The iearned r\dditional Advocate General would subrr it that the Government follc ived correct procedure AS spellecl out in the procurement marual and the tender notifrcation. It is e nphasized that respondent NIo.1 failed to meet the tender condition No.3.2, which reads as foll,rws: "Thc biddcr shiLll have satisfactorily completed al least onr: rvork of Mining/Civil/ Irrig r ion rvork of value not less than Rs.4,65.82,r-)03 / (Rupecs Four r--rore Sixlv Fr\ c lakhs Eighty Two thousand and Thrcc onllJ (8o'ti, c l vaiue of u,ork) involving e <r:zlr,artion and removal any Earth/minertrl inclrding sancl in Statc/Ccntral (iovl.nrncnt Undertakings during the lasl thrcc (3) rr-'ars." 7 . In this regzu^d referring to the Work Done Certifi,:ates uzde Ref.Nos.KGM/JVFI OC-IIl2023/338C1608 and KC}M/,lVR OC- IIl2023/338D /609, both dated 12/ 16.05.2023 subrritted by respondent No.1, it is argued that said certifir:atr s clearly demonstrate that -,,.spondent No. 1 did not complete the cor tracts but rather the u'ork is still in proglress in 'Present status of r,,.ork" column.

8. In that conloxt, it is argued that any bidder has tI produce certihcate showin 3 satisfactorily completed work of \/alu( ) not less tharr Rs.4,65 ,a2,OO3 I - during the last three years of the bid. It is a.S,l$ that amon.l 15 technical qualifred bidders, 9 u,ere r,jected for 5 not complying tender clar.rse 3.2 and the sarne was informed through e-procurement website on 08.07.2024. Respondent No.1 is one arnong 9 bidders whose tender was rejected for failing to meet the criteria. The learned Additional Advocate General argued that the Hon'ble Supreme Court in various judgments held that in contractual matters the scope of judicial review or interference under Article 226 of Constitution of India is available in exceptional circumstances, such as, on account of mala fides, arbitrariness and illegalities' Whereas, in the instant case, no specific instance of malice is made out. Only because respondent No. 1 failed to satisfy the condition under clause 3.2 of tender condition its bid was rejected which is not arbitrary. The learned Additional Advocate General referred to the judgment of the Hon'ble Supreme Court in Agmatel India Priaate Lirnited v. Resourys Telecom and other#, wherein it is held that 'The above mentioned statements of law make it amply clear that thc author of the tender document is [aken to be the best person to understand and appreciate its requirements; and if ils interpretation is manifcstly in consonance with the language of the tender document or subserving the purchase of the tender, the Court would prefer to keep restraint. Further to that, the tcchnical evaluation or comparison by the Court is impermissible; and even if the interpretation given to the tender document by the person inviting offers is not as such acccptable to the constitutional court, that, by itself, would not be a reason for interfering with thc interpretation given." g. The contention of respondent No.1 about giving opportunity under. clause 21 to provide clarification with respect to Work Done o lzozzls scc zez 6 F--. Certihcate, it is a-gued that the employer can seek clarific rtion at its discretion. When the Work Done Certihcate itself clearl ,. reflected that respondent I'1o.1 did not complete the u,ork, there rs ro need to seek any clarifrcz(ion. Lastly, it is argued that the lear'red Single Judge erred in observing that the letter of intent dated 1O.O7.2O24 was issued in fav,tur of respondent No.2 and the same is r:ontrarSr to the information or the web site which shows tender was awarded on

19.O7.2024. Accrrding to the learned Additional Advocate General, after the brds rr,er-t: submitted by prospective bidders, the brds were evaluated by the Tender Evaluation Committee on OB.C7 .2024 to ascertain the conrlitions stipuiated and successful bidrler rras issued the letter of intenr on 1O.O7.2024 and said information u.ar; uploaded on 79.O7.2024, Ilr the entire process, there is no mala .fid< or lack of i tralsparency. Lea rned Additional Advocate Generzrl r rferred to judgment rn W.;\.Nos.116 and 177 of 2O25, dated 13.02.2025 wherein it rvas heltl that: "16. A carefr- I lcacling of Clause 17.0 reproduccd hereinabove shol/s that if brddcr has been b: rrncd by any other body and has disclosed this fa{rr cler rly in his bid, as a rule of thumb, SCCL management will not drsqualif-v L,im. I hc SCCL managemcnt rcser,/,:s right to take appropriate decision in such evenru rlity. Thc language emplo-ye I in the aloresaid clause shows that it cnables t.1e SCCL managemcnt to Lakc an appropriate decision in such cases r.ther,: dist losure of banning rs there. 'Ihe decision taken by SCCL management in the prrtscltt tase ts Lo disqualify the pctit orler. At this stage, we are not incltned to put the clock back and direct the Sillgare I Collieries Company Limited to undertakc Lhe eDtir( exercise afrcsh. The SingarlrLi Collieries Company Limited is serving public irrtercs For the smooth production irnd running of Singareni Collierics Companr- Limrtcd, ;upply of explosivc is er;sential. Any interference by us at this juncLure, v,.ill h. mper the activity of thc lndritn,:lnd consequently nill have an adve.s,tr rmlaLl t,n publ(c -bulk 7 interest. Thus, in the peculiar facts of tlLese cases, we are not inclined to interfere in the matter. More so, after passing of impugned o'der, third Party righls are created and contracts have been granted to nine (9) contractors and they are not parties before us."

10. On the basis of above judgment, it is argued that this Court in similar cases on earlier occasions declined to interfere with the decision made by the Government while awarding tenders 1 1. Learned counsel for respondent Nos.1 and 2 argued that it has fulfilled cond.ition r]nder clamse 3.2 0f tender conditions and therefore it was found to have qualifred as per the entry in web portal dated 1g.O7.2024. It is argued that the learned Single Judge had assessed the tender process adopted by the writ appellants in proper perspective with respect to meeting the clause 3 '2 of tender conditions, not providing opportunity under tender clause 21 for giving clarihcation about the Work Done Certihcates and rejecting the tender without assigning reasons. In that regard, learned counsel for respondent Nos. 1 and 2 referred to judgment of the Hon'ble Supreme Court of India in M/s. Kasturi La'l I'a,kshi Reddg, rep' bg its partner Shri Kasturi I'al and others a. Stolte Qf Jamtnu and Kah.smir and anotheF, wherein it is held that "15... .....Where the govemment is dealing with the public, whether by way of giwing jobs or enterrng into contracts or granting other forrns of largess the Government cannot act arbltrarily at its, sweet will and, like a prrvate individual, dcal with any pEson it pleases, but its action must be in conformity with some standard or norm whi+ is not arbitrary, irrational or irrelevant The gove'nmental action must not be ' (rgao)a scc r ; 8 (: arbitrary or c.rp.i( i,)us, but must be bascd on somc principle which meets thc test of reason and relevar!)e-.."

12. Learned cou.nsei for the respondents vehemenl-1y a rgued that no reasons are ir'ssigned for rejecting its bid and therel)y there rs violation of prin<:iples of natural justice. In that c,lnte <t, learned counsel for the r espondents referred to judgment of t re Honble Supreme Court of India in Dharmapal's case (1 supra) atrd relevant portion is extract,:1 and produced below: "The principles of natural justice developcd over a penod of Lime and nhir: r is still in vogur: and vali<l e'tn Loday were: (i) rule agalnst bias, i.e. nemo tudr:x in :ausa sua; and (ii) opportunilv olberng hcard to the concerned party, i.c. aucli alleram partem_ Thesc arc knoq-n ;r; pnnciplcs oI natural Justice. To these principles a rhir I principlc is addecl, uhich is rf recent origin- It is dury Lo give reasons in suppor i rIdecision, narnell', passing o ,l reasoned orclcr'.

13. Analysis bY the Court: A perusal ol thc record and the arguments of both tee counsel show that the c|rx of the dispute is with respect to r,r,h er her or not respondent No. I mct the criteria under clause 3.2 of tender conditions, rvhetl,er the writ appellants acted with m(lla J des in not providing an opl)(rrtunity to respondent No. 1 to give c larification about its Work Done Certihcate and lastly whether the writ appellants did no-. give a reasoned order for rejection ol- bid submitted by respondent lrlo.1 and thereby the tender process lacks transparencj,. ,t;\ 9

1.4. First and foremost tender under clause 3.2 makes it mandatory for the bidders to submit Work Done Certificate showing satisfactory completion of at least one work of mining/civil/irrigation of value not less than Rs.4,65 ,82,OO3 I (80% of value of work) involving excavation and removal any earth/rnineral including sand in State/ Central Government . Undertakings during the last three years. The aforementioned condition requires that the bidder shall complete at least one work of required monitory value, complete satisfactorily that too within last three years of the date of the bid. While so, the Work Done Certificate submitted by respondent No.l shows that the said company has taken up the work of Singareni Collieries through work order No.760O009282, dated 21.1O -2022 and has completed certain work upto March 2023 ard the status of the work is 'work in progress". Similarly, respondent No.1 has taken up another work from Singareni Collieries Company Limited and the certificate shows that the work is still in progress. The contents of the Work Done Certificates submitted by respondent No.l failed to meet two criteria, i.e. completion of work and completion of work satisfactorily. Only when the entire work is completed that too to the satisfaction of the employer, it can be said that respondent No.1 has successfully fulfilled the criteria under clause 3-2 of tender conditipns and not otherwise. The contents of the Work Done t Certifrcate speak for themselves and cannot be given any other i 10 interpretation. Tlre respondents would contend that the contracts awarded are for a period of 11 months ald 17 monttrs rt spectively and each compon,lnt of work done is a separate piece rvor' r u'hich is to be treated as c:mpleted satisfactorily. Such interpretat ion of the contents of the Wr,r'k Done Certilicates is not acceptable.

15. Coming to tlle aspect of seeklng clarifrcation from the bidder as per clause 21 of tt:rtder conditions, said tender conclition it ielf clearly shows that the cleLrification may be sought at the discrel ion of the employer. ln cast, the employer after perusing the cont)nts Work Done Certihcate t as come to the conclusion that the u'orl is sti11 in progress ancl tha- has not been completed, no fault can be found with the emplo,ye - A conjoint reading of clause 3.2 and 21 of the tender conditions together with the contents ol Wrrk Done Certificates does tr,tt make out a positive case in favour of respondent No. 1.

16. Coming to 1he contention of respondent Nos.1 and 2 that as per clause 22.1 . tte eligibility criteria is as per delinition ITB clause 3 and only u,hen the eligibiiity criteria is met, the further evaluation takes place. To ir,scertain the case of respondent Nos. 1 and 2, said entry in the rl'eb l,ortal is produced below: In LL t) Technical parameters list: Operat Datc T]"e Min Ma-'< Text o.00 o.00 Fuml Remarks Evaluation As Tender Document Clause 3.2 of Tendcr conditions fulfilled

17. A reference is made to the contents of above award of tender dated 19.07.2024 to the "Remarks" column wherein it is entered as "As per Tender document". This entry in the Remarks column is mis interpreted by respondent No.l to mean that respondent No'l has met the eligibility criteria as per 3.2. To the contrar5r, the meaning of the contents of "Remarks" column can be construed as that respondent No.l qualihed for further evaluation of the bid as it has met the eligibility criteria by frling all the required tender documents including the Work Done Certificate. The title of the column is "Remarks". Remarks with respect to whether the bidders have Frled all the documents or not. Only such bidders who have frled ali the documents are eligible for eva,luation of their bids and further steps.

18. The next column is titled "evaluation comments", wherein it is clearly mentioned as "clause 3.2 of Tender conditions not fulfilled". Therefore, a close scrutiny of the contents of "Remarks" column and the contents of "evaluation comments" column shows that the cbntents of the Remarks column are meant for noting down the eligibility of a bidder prima facie on account to filing of required \"< l 77 n documents as per tender notification and not on the basis :f contents of said documents. Only after the documents filed for the evaluation of the bid are in rrder. the contents are examined an<1 an evaluation is made as to the eligibility of the bidders and thereb), 'espondent No.1 has been fo:nd to be lacking to have met the conditlons under clause 3.2. Horvever, respondent No.1 is mis interpreting the contents of "Re larks" column and the "evaluation :omments" column and the same has been erroneously relied up on by the learned Single Judge while passing the impugned order.

19. Coming to t he aspect of observing principles of natural justice, about passing a reasoned order lr.hile rcjecting an aptr lication, a reasoned order is passed when there is an adjudicatio n process, where there are tv,,o or more rival contestants, each persc,n is heard and arr evaluaticn is made of the rival contentions anr reasoned order is passed. ln the instant case, the entire tender process took place online u,herein the bids are submitted online and the result also has been de,:lared online. A reason for rejection is the criteria for meeting the r e:quirements of principles of natural jur;tice. The said reasoned or<1,:r could be one word, one line or zi pa.agraph or more. In the inl;r-ant case, the employer has given the reason for rejecting bid of I r:spondent No. 1 by stating that respor dent No.l tailed to meet the :onditions of clause 3.2 of tender condi.ions. The said reason when written in one line or in an elaborate marner would convey the same meaning. Thus, there is no ground to accuse the writ appellants of not observing the principles of natural justice.

20. Lastly, mala fides are attributed to the writ appellants on the basis of issuance of letter of intent dated IO.OZ.2O24 whlle tlre information was made available by the writ appellants on e- procurement website indicated that respondent No.3 was declared the successful bidder and awarded the tender only on 19.07.2024. in this regard, it is seen that the said allegation was not made by respondent No.1 in the writ petition but was raised only at the time of frling a rejoinder to the counter hled by respondent No.3. 2t. In this regard, as per judgment of the Hon'ble Supreme Court in Arti Sapru a. State of Jammu and Kashlrr.ir6, the allegations made for the frrst time in the rejoinder aflidavit do not give scope for reasonable opportunity to the respondents to give reply and therefore cannot form basis for a finding in favour of the petitioner. Likewise in the matter of Ashok Lanka a. Rishi Dikshifl ' the Hontrle Supreme Court heid that when the allegations are made in the rejoinder, when no new plea can be permitted in the rejoinder, without the leave of the Court, such allegations carnot be relied upon. While legat precedents do not support respondent No' l's u (rssr)zscc +a+ '(zooo)gscc go I l : L4 6 allegations made in the rejoinder for the hrst time attribr rting mala fides, we are of tlre considered opinion that the contents rf the web portal dated 19 .O7 .2024 are also mis interpreted on ,acco unt of the fact that the tetr,ler evaluation process has been corr pleted by Oa.O7.2O24 and Jre letter of intent was issued to the ;uccessful bidder on 70.O7.).O24 and said information was uploaded in the website on 79 .0'7 .2024. Last but not least, after the bids are evaluated, the eli11ible bidder has been selected by u.ay of lottery in the presence of zll the bidders. The learned Additional Advocate General pointed cut that even respondent No.1 participa ed in the Iottery process thzLt took place on IO.OZ.2024 and tl.rerefort , no mala fides can be attributed to reference Nos.1 and 2, as the enti.e process has been cond,ct.rl in tra,sparent manner as per the lertd,:r process contemplated in the tender conditions as well as notificatir,n. When the successful bidcer is selected through the process of rlrrrwing lots in the presence o1 al1 the eligibie bidders, no mala.,ficle s can be attributed to the vr::it appellants in conducting the tender l rrocess in fair and transparent manner.

22. For the foregcing reasons, we are of the considererl op nion that the learned Single ,Judge erred in reading the contents of the Work Done Certifrcates, rhe e-procurement award dated 19.07.,.1024 arld. factum of iss u.ance of letter of intent dated IO.O7.tO24 and L, .r 15 publishing said information on 19 .O7 -2024 in the e-procurement online website and therefore the said impugrred of the learned Single Judge is liable to be set aside.

23. In the result, the Writ Appeal is allowed setting aside the order dated 28.10.2 O24 in W.P.No.2197 5 of 2024 p.""td by the learned Single Judge. There shall be no order as to costs. Miscellaneous applications, if any, pending in this appeal, shall stand closed. \ \ To, //TRUE GOPYI/ SD/ [?,t+HEti3'[iR SECTTON OFFICER

1.7 2 rnment, ck 3rd Unde floor, Kh Director, Telangan a Mineral Develop ment CorPoration Limited rtaking Havlng ofltce at a![atabad Hyderabad he Managing TGM DC, A elangana State Gove T rear blo 62915, HMWSSB Premtses 500004 The Vice Chairman and CorPo rationLimited TG Khai rear block 3rd floor, Writ ion Officer a, HYdera on Officer on offi cer, Po sting Section I DeveloPment SB, Premises 629 0004. High Court for the State of , Writ(Non-service), Section High Court for the State of , High Court for the State of Telangana ' DDITIONA L ADVOCATE GENERAL' High Court for the State Managing.D Having MDC, , Hyd e ratabad Divisio n Ben irector, Tel office at rabad 50 ch, Section Minera HMWS Telangana 15,

3. The Sect Tela 4. The Secti at HYd I. TAR ouTl UNG .RE DDY Advocate IOPUCI 5 7 B BM LS yd erabad Two CCs to A na, of Telanga SR One CC to Two CD Copies t+ HIGH COURT DATED:2710312025 I ,,. \ ,} * o u- ,s s $' (', l; lti JUDGMENT WA.No.180 of 2025 ALLOWING T'HE WRIT APPEAL WITHOUT COSTS (+ )-l \ )-) )\ I ; t I