Summary
| Category | Data |
|---|---|
| Court | Supreme Court of India |
| Case Number | C.A. No.-011726-011726 – 2025 |
| Diary Number | 3047/2025 |
| Judge Name | HON’BLE MR. JUSTICE JOYMALYA BAGCHI |
| Bench |
HON’BLE MR. JUSTICE SURYA KANT HON’BLE MR. JUSTICE JOYMALYA BAGCHI |
| Precedent Value | Binding authority on procurement and tender-interpretation disputes |
| Overrules / Affirms |
|
| Type of Law | Public procurement / contract law |
| Questions of Law |
|
| Ratio Decidendi | The Supreme Court held that Clause 5(D) permits reliance on past-experience of a consortium if the bidder’s proportionate share is defined in the Consortium Agreement or demonstrated by a work-execution certificate; it does not expressly mandate submission of the JV agreement itself. The disqualification for non-production of the JV agreement was thus contrary to the clear terms of the NIT. Conditions in a tender must be unambiguous, and where proof of share is furnished by an execution certificate stating the share and referring to the agreement held by the customer, rejection for non-submission of the agreement alone is impermissible. The Court also observed that the tendering authority could have invoked Clause 8.8 to seek clarifications but failed to do so. However, the High Court exceeded its mandate by upholding an independent disqualification under Clause 5(B) on washery capacity—an issue not decided by the Tender Committee and raised for the first time in escrito submissions—which necessitates remand for fresh consideration. |
| Logic / Jurisprudence / Authorities Relied Upon by Court |
|
| Facts as Summarised by the Court | The appellant bid for ROM coal-beneficiation and logistics under an NIT requiring past-experience credentials. It submitted a work-execution certificate from MSMC showing a 45 percent share in a previous consortium and execution of similar work, but did not furnish the JV agreement itself. The Tender Committee disqualified the bid under Clause 5(D) for non-submission of that agreement. The High Court upheld disqualification under both Clause 5(D) and, sua sponte, Clause 5(B) on washery capacity, leading to this appeal. |
Practical Impact
| Category | Impact |
|---|---|
| Binding On | All procuring entities, subordinate courts, and tender evaluation committees |
| Persuasive For | High Courts, regulatory authorities, public procurement tribunals |
| Overrules | The Madhya Pradesh High Court’s order in Writ Petition No. 18286/2024, insofar as it upheld disqualification under Clause 5(D) |
| Distinguishes | Disqualification raised for the first time without committee findings (Clause 5(B) washery capacity issue) cannot be sustained without fresh opportunity to be heard |
| Follows | Established principle that tender conditions must be clear and unambiguous |
What’s New / What Lawyers Should Note
- Clause 5(D) of the NIT does not, by its plain terms, make production of the JV agreement mandatory if the bidder’s share and performance are evidenced by a customer’s work-execution certificate.
- Ambiguities in tender documents cannot be retrospectively filled by implied requirements; conditions must be expressly stated.
- Tendering authorities should use non–obstante or clarification clauses (e.g., Clause 8.8) to seek missing information rather than outright rejection.
- A court or authority cannot introduce new grounds of disqualification (e.g., washery-capacity under Clause 5(B)) without giving the bidder a fair opportunity to contest them.
- This decision is now binding for interpretation of past-experience and document-submission requirements in public tenders.
Summary of Legal Reasoning
- Interpretation of Clause 5(D): The clause permits use of past consortium experience proportionate to the bidder’s share “if defined in the Consortium Agreement, otherwise lead partner.”
- Sufficiency of Execution Certificate: The certificate from MSMC stated appellant’s 45 percent share and was conclusive proof of share and performance.
- Absence of Express JV-Agreement Requirement: No explicit phrase in Clause 5(D) mandated submission of the JV agreement itself; unambiguous requirements in a tender cannot be implied.
- Failure to Use Clarification Power (Clause 8.8): The tendering authority could have asked the appellant to furnish or verify the agreement but declined.
- Administrative-Fairness Principle: Disqualification for non-submission of an unrequired document violated fairness and transparency in procurement.
- High Court’s Overreach on Clause 5(B): The Madhya Pradesh High Court introduced a new disqualification on washery capacity grounds, raised only in written submissions, without remand to the committee or opportunity for appellant to rebut.
Arguments by the Parties
Appellant (Maha Mineral Mining & Beneficiation Pvt. Ltd.)
- Clause 5(D) does not expressly require the JV agreement itself; the work-execution certificate suffices to show a 45 percent share.
- It had no opportunity or obligation to seek clarification, and the subsequent email with a JV agreement was impermissible under Clause 8.1 but unnecessary under Clause 5(D).
- No mala fide suppression: all documents consistently show the same share.
1st Respondent (MP Power Generating Co. Ltd.)
- Implicit requirement to furnish the JV agreement to demonstrate proportionate share.
- Clause 8.1 and government circular prohibit submission of short-fall documents after bid closing.
2nd Respondent (Rukhmai Infrastructure Pvt. Ltd.)
- Under the JV agreement, appellant’s washery capacity was fully committed to MSMC, disqualifying it under Clause 5(B).
Factual Background
In May 2024, MP Power issued a Tender for ROM coal beneficiation and logistics from Western Coalfields Ltd. The appellant and two others bid; one dropped. The Committee rejected the appellant’s technical bid under Clause 5(D) for not furnishing the JV agreement to prove its share in a past consortium. The appellant challenged in the Madhya Pradesh High Court, which upheld the rejection under both Clause 5(D) and, sua sponte, Clause 5(B) on washery-capacity grounds. The Supreme Court granted leave, set aside the 5(D) disqualification, and remanded the 5(B) issue for fresh consideration.
Statutory Analysis
- Clause 5(D) (Past Experience): Requires work orders and execution certificates; allows bidder to use consortium experience proportionate to share “if defined in the Consortium Agreement, otherwise lead partner.” No express mandate to submit the agreement.
- Clause 8.1 (No Short-fall Window): Bars submission of missing documents post-bid; supplemented by a government circular dated 29.11.2023.
- Clause 8.8 (Clarifications): Non-obstante clause permitting the authority to seek additional information to satisfy eligibility.
- Clause 5(B) (Washery Details): Requires bidder to have wet-beneficiation washery with ≥50 percent spare capacity within 100 km of mines/siding.
Dissenting / Concurring Opinion Summary
None; judgment authored by a unanimous bench of Justices Surya Kant and Joymalya Bagchi.
Procedural Innovations
- Clarification of the interplay between “no short-fall window” clauses and non–obstante clarification powers in procurement documents.
- Reinforcement that courts and committees cannot introduce new disqualification grounds without notice and hearing.
Alert Indicators
- ✔ Precedent Followed – Affirms the principle that tender conditions must be clear and cannot be implied.
- 🔄 Conflicting Decisions – Resolves conflict between the Tender Committee, the High Court, and the bidder on document submission requirements.