Bombay High Court
Larsen And Toubro Limited vs Mumbai Metropolitan Region ... on 20 May, 2025
2025:BHC-OS:8211-DB
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION (L) NO. 15216 OF 2025
Larsen & Toubro Limited, a company ]
incorporated in India, and having its ]
registered office at L&T House, Ballard ]
Estate, Mumbai 400 001. ] ... Petitioner.
V/s.
1. Mumbai Metropolitan Region Development ]
Authority (MMRDA), a statutory body under ]
the Mumbai Metropolitan Development Act, ]
1974, having its office at Plot No.14 & 15, ]
MMRDA New Building, BKC, Bandra (E). ]
2. Engineer-in-Chief/Chief Engineer ]
Engineering Division, Mumbai Metropolitan ]
Region Development Authority (MMRDA), ]
nd
having his office at 2 Floor, New Office Building ]
Plot No. R005, R-06 & R-12, 'E' Block, ]
Bandra Kurla Complex, Bandra (E), ]
Mumbai Maharashtra, INDIA - 400 051. ]
Email: chiefengineer1@mailmmrda. ]
maharashtra.gov.in ] ... Respondents
______________________________________
Mr. Janak Dwarkadas, Senior Counsel a/w Mr. Zal Andhyarujina, Senior
Counsel, Adv. Ativ Patel, Adv. Viloma Shah, Mr. Harshad Vyas, Mr. Pawan
Kulkarni and Mr. Viraj Raiyani, i/by M/s AVP Partners for the Petitioner.
Mr. Tushar Mehta, Solicitor General of India and Mr. Mukul Rohatgi, Senior
Counsel a/w Mr. Chirag Mody, Adv. Anjan Dasgupta, Adv. Rimali Batra,
Adv. Prachi Garg, Adv. Prerna Verma, Adv. Abhishek Lalwani and Adv.
Sayalee Dolas, i/by DSK Legal for the Respondent.
Mr. Yatin Sakhalkar, representative of MMRDA.
_____________________________________________
Digitally
signed by
ASHWINI
CORAM :
KAMAL KHATA AND
ASHWINI
H GAJAKOSH
GAJAKOSH Date:
ARIF S. DOCTOR, JJ.
2025.05.20
17:46:00
+0530 RESERVED ON : 15th May, 2025.
PRONOUNCED ON : 20th May, 2025.
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PC:-
1) The Petitioner has preferred the present Writ Petition seeking urgent
restraining Orders against Respondents-MMRDA to prevent opening of
Cover-II which contains the financial bids for the Road Tunnel Project, on
13th May 2025 at 11.00 am scheduled without first notifying the Petitioner
of the fate of the Petitioner's Technical bid.
2) Respondent No. 1 ("MMRDA") had on 27th July 2024 issued a notice
inviting public infrastructure projects namely, (i) Road Tunnel Project with
tender reference no. MMRDA/Tunnel Gaimukh to Fountain/2024 (Tender
ID 2024_MMRDA_1061485_1 for the Design & Construction of
underground road tunnel from Gaimukh to Fountain Hotel Junction on
Thane Ghodbunder Road ("said Project"). The said Project envisages 5km
long twin tunnels of finished diameter of 14.6m estimated at approximately
INR 8,000 Crores, which is an extension of the Mumbai Coastal Road
project and a part of the MMRDA's larger road expansion project involving
construction of approximately 15 km of road from Gaimukh in Thane to
Bhayander.
3) The Petition avers that Petitioner is a reputed Indian multinational
conglomerate and one of the foremost multinational construction
companies in India and abroad, who has successfully executed many
projects of national and international significance. MMRDA is a statutory
body under the Government of Maharashtra and a 'State' within the
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meaning of Article 12 of the Constitution of India.
4) The Petitioner is one of the bidders for the said Project and had on
13th December 2024 submitted its technical bid, which was opened on 1st
January 2025. Since then, the Petitioner has been awaiting the outcome of
the evaluation of the technical bid. Recently, the Petitioner learnt that
MMRDA had addressed letters to some bidders to remain present for the
opening of the financial bid on 13th May 2025. Since the Petitioner had
not received any intimation from MMRDA either by an email
communication or on its portal, they addressed a letter dated 12th May
2025 and requested MMRDA to confirm whether the financial bid was
indeed being opened on 13th May 2025 at 11.00 am. The letter also
clarified that the Petitioner would be constrained to proceed on the basis
that MMRDA would open the bid on 13th May 2025, contrary to the terms
of the tender documents and in violation of the principles of natural justice.
5) The Petitioner, however, did not receive any intimation from
MMRDA calling upon the Petitioner to either remain present for the
opening of Cover-II of the bid or to the effect that the Petitioner's technical
bid had been found to be non-responsive. The Petitioner, however, learnt
that some of the bidders had received an intimation from MMRDA that
financial bids would be opened on 13th May 2025 at 11.00 am and at
which time the said bidders were to be present. The Petitioner apprehends
that MMRDA will proceed to open the financial bids of other bidders to its
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exclusion, contrary to the fair and transparent tender process that MMRDA
must follow. Since they did not receive any response, they were compelled
to file the present Petition on 13th May 2025.
6) The Petition further avers that MMRDA, being a public authority, is
bound to act in a non-discriminatory, fair, and transparent manner. It is
bound to intimate the Petitioner about the outcome of the evaluation of its
technical bid before the financial bids are opened. The decision to open the
financial bids in the absence of the Petitioner without intimating them of
the outcome of the evaluation of its technical bid is discriminatory and
arbitrary and in violation of the principles of natural justice. It has serious
consequences of depriving the Petitioner of its valuable constitutional
rights, including to carry on trade and business and to protect and
safeguard its legal entitlements under the tender process. Under these
circumstances, it is requested that MMRDA be restrained from opening the
financial bids until such time that the Petitioner is informed that its
technical bid has been declared non-responsive.
7) Mr. Dwarkadas, Learned Senior Counsel appearing on behalf of the
Petitioner, invited our attention to Clauses 27.7 and 27.8 of Volume I of the
tender documents, i.e., the Instructions to Bidders document ("ITB") at
page 46 of the Petition, which he pointed out provide as follows :
"27.7 At the end of the evaluation of Technical Bids, the Employer
will invite Bidders who have submitted substantially responsive
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Technical Bids and who have been determined as being qualified
for award to attend the opening of the Price Bids. The date, time,
and location of the opening of Price Bids will be advised in writing
by the Employer. The opening date should allow Bidders sufficient
time to make arrangements for attending the opening.
27.8 The Employer will notify, in writing, Bidders who have been
rejected on the grounds of their Technical Bids being substantially
non-responsive to the requirements of the Bidding Documents and
return their Bid security and Price Bids unopened".
8) Placing reliance on the above, Mr. Dwarkadas submitted that it was
therefore abundantly clear that the MMRDA had to notify, in writing, those
bidders whose Technical Bids were substantially non-responsive and return
to them the bid security along with their unopened price bids before
proceeding to the next stage, i.e., opening of the financial bids. He
submitted that absent first declaring the Petitioner's technical bid as non-
responsive, the Petitioner would also have a right under the ITB to be
present when the financial bids were opened. He submitted that failure on
the part of MMRDA to ensure the presence of the Petitioner at the time of
opening the financial bids without declaring the Petitioners technical bid as
non-responsive would not only be patently arbitrary and discriminatory but
also plainly contrary to clauses 27.7 and 27.8 of the ITB and would give the
other bidders an unfair advantage over the Petitioner.
9) Mr. Dwarkadas then drew our attention to the guidelines dated 27 th
September, 2018, issued by the Public Works Department, Government of
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Maharashtra ("PWD Guidelines"), and highlighted Clause 4.1. He pointed
out that the PWD Guidelines cast an obligation on the tendering authority
to communicate to the bidders a list of qualification/disqualification after
opening of the technical bids and to publish the same on the web/portal on
which the e-tender process was being carried out. He further pointed out
that the PWD Guidelines also provided that the disqualified bidders would
be intimated about their disqualification along with the reasons and also be
provided a hearing after the opening of their technical bid. Mr. Dwarkadas
clarified that at this stage the Petitioner was neither seeking the reasons nor
a hearing but was only seeking an intimation from MMRDA as to whether
the Petitioner's technical bid had been held to be non-responsive and if not,
why the Petitioner was not invited for the opening of the financial bid.
10) Mr. Dwarkadas then referred to the Central Vigilance Commission's
guidelines dated 24th March 2005 (Office Order No. 15/3/05) (" CVC
Guidelines"), from which he pointed out that the tendering authority was
bound to record clear, logical reasons for the rejection of bids
notwithstanding any clauses to the contrary in the notice inviting tenders.
11) Mr. Dwarkadas then submitted that the very object of the CVC
Guidelines was to avoid any arbitrary action on the part of the tendering
authority at the stage of technical evaluation. He then placed reliance upon
the judgement of the Hon'ble Supreme Court in Haffkine Bio-
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Pharmaceutical Corporation Limited V/s. Nirlac Chemicals & Ors 1 to submit
that if the financial bids were opened without intimating the Petitioner of
the fate of its technical bid, the entire tender process would stand vitiated
as being in violation of the CVC Guidelines. He then also placed reliance
upon the judgement of the Hon'ble Supreme Court in the case of Surendra
Infrastructure (P) Ltd. V/s. State of Maharashtra2 to submit that, as noted
therein, the PWD Guidelines would even be applicable in the present case.
He further submitted that the procedure laid down in the CVC and the PWD
Guidelines was to ensure a fair and transparent tendering process since the
opportunity to participate in a commercial tender floated by the State was a
constitutional right under Article 21 of the Constitution of India.
12) Mr Dwarkadas thus submitted that the State was therefore bound to
ensure a 'level playing field' and transparency and fairness through every
stage of the tendering process in the larger public interest. He submitted
that if the policy or act of the State or its Authorities fails to satisfy the test
of reasonableness, then such an act or decision would be unconstitutional.
To substantiate his contention, he placed reliance upon the Judgments of
the Supreme Court in the case of Reliance Energy Ltd. & Anr. V/s.
Maharashtra Road Development Corporation Ltd.3 and the decision in the
1(2018) 12 SCC 790
2 2024 SCC Online Bom 2908
3 (2007) 8 SCC page 1
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case of Food Corporation of India V/s. Kamdhenu Cattle Feed Industries 4 to
submit that the State and all its instrumentalities have to conform to Article
14 of the Constitution of India and thus act in a non-arbitrary, fair and
transparent manner. He submitted that the duty of the State to act fairly in
the discharge of its obligations was a part of good administration and
governance.
13) Mr. Dwarkadas then also placed reliance upon the judgement of the
Hon'ble Supreme Court in the case of Konkan Railway Corporation V/s.
Union of India5 to submit that the primary objective of a public tender was
to maximise competition. He thus submitted that, in order to achieve this
objective, a bidder whose technical bid was rejected had the right to know
the reasons on which such a bid was rejected in order to seek judicial
review and have such disqualification set aside if the same was arbitrary
and failed to satisfy the test of reasonableness. He submitted that this
opportunity was lost to the Petitioner since MMRDA had failed to intimate
the Petitioner that its technical bid had been declared non-responsive and
thus deprived the Petitioner of an opportunity to challenge the same. This,
he submitted, would cause irreversible loss and grave prejudice to the
Petitioner.
14) Basis the above, Mr. Dwarkadas submitted that it was incumbent
upon MMRDA not to exclude the Petitioner at the opening of the financial
4 (1993) 1 SCC page 71
5 2025 SCC OnLine Bom 612
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bids.
15) Per contra, Mr. Mukul Rohatgi, Learned Senior Counsel appearing on
behalf of the MMRDA, at the outset submitted that the Petition deserved to
be dismissed with costs, since the Petitioner was guilty of wilful and
deliberate suppression. In support of his contention, he invited our
attention to clauses 28.1 and 42.5 of the ITB, which he pointed out
provided thus:
"28.1 Information relating to the evaluation of Bids and
recommendation of Contract award, shall not be disclosed
to Bidders or any other persons not officially concerned with
such process until information on Contract award is
communicated to all Bidders in accordance with ITB 42."
42.5 After notification of award, unsuccessful Bidders may
request, in writing, to the Employer a debriefing seeking
explanations on the grounds on which their Bids were not
selected. The Employer shall promptly respond, in writing,
to any unsuccessful Bidders who, after the notification of
award in accordance with ITB 42.1, request a debriefing ."
16) He pointed out that the above clauses of the ITB itself made explicitly
clear that the information regarding the evaluation of bids shall not be
disclosed to the bidders until information on award of the contract was
communicated to all the bidders. He submitted that not only had the
Petitioner accepted the above clauses but had deliberately suppressed the
same from the Petition. He submitted that it was incumbent upon the
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Petitioner to have disclosed the said clauses and then have explained as to
how, in light of the said clauses, the Petitioner could at this stage resist the
opening of the financial bids solely on the ground that the Petitioner had
not been intimated that the Petitioner's technical bid had been declared
non-responsive. He thus submitted that since the Petitioner had failed to do
so and, on the contrary, suppressed the said clauses, the Petition deserved
to be dismissed on this ground alone.
17) Mr. Rohtagi then submitted that one who approaches the Court must
do so with clean hands and must disclose all material facts without any
reservation, even if the same are against such a party. In support of his
contention, he placed reliance upon the judgements of the Hon'ble Supreme
Court in the case of K.D. Sharma vs Steel Authority of India Limited & Ors 6
to submit that if the applicant does not disclose all the material facts fairly
and justly, but states them in a distorted manner, this Court has the
inherent power to prevent abuse of its process and refuse to proceed further
with the case on examination on merits.
18) Mr. Rohatgi then without prejudice to the above, submitted that the
decision of the Hon'ble Supreme Court in the case of National High Speed
Rail Corporation V/s. Montecarlo Ltd. & Anr. 7 would apply on all fours to
the facts of the present case. He pointed out that clauses 28.1 and 42.5 of
the ITB in the present case were identical in terms to the clauses which fell
6 (2008) 12 SCC 481
7 (2022) 6 SCC 401
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for consideration in the case of Montecarlo Ltd., in which the Hon'ble
Supreme Court, when construing the said clauses, inter alia, held as
follows:
"43.2. The purpose of the aforesaid clauses appears to be to
prevent a possible challenge to the multiple stage tender process
midway. The High Court has construed that the said clauses would
restrict the right of the bidders to seek judicial scrutiny of the
tender process. However, the High Court does not seem to be
wholly true. The High Court ought to have appreciated that first of
all Clause 28 is a confidentiality clause. On general reading of the
aforesaid two clauses, it can be said that it does not take away the
right of the bidders to seek judicial scrutiny at all. Only the stage
and time to know the reasons and thereafter if the unsuccessful
bidder is aggrieved, can seek the remedy, which is deferred till the
final decision on award of contract is taken and communicated. "
19) Mr. Rohatgi submitted that like in the case of Montecarlo the said
Project was also a Mega infrastructure project of vital public importance
and thus bearing in mind the significant public interest, were required to be
completed expeditiously and with minimal interference.
20) The Learned Solicitor General then, in addition to what Mr. Rohatgi
had submitted, assured the Court that the Petitioner would be given the
reasons for the rejection of its technical bid in the manner and stage as
provided in clause 42.5. He also gave the same assurance as given in Writ
Petition (L) No. 15215 of 2025, namely that MMRDA would notify
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regarding the award of the contract to unsuccessful bidders and would
furnish to the Petitioner the reasons for rejection of its technical bid. He
further specifically clarified that it would be open for the Petitioner to
impugn the same, including by filing a Writ Petition. He further clarified
that even after the declaration of the successful bidder, all rights and
contentions of the Petitioner, including the challenge to the award of the
contract, would be kept open and that MMRDA would not take a defence
that the Petitioner would only be relegated to a Suit for damages. He thus
submitted that the Petition being one which was entirely lacking in merit
deserved to be dismissed, as any delay in the opening of the financial bid
would have grave implications on the progress of the said Project which
would affect the public at large and also imperil the project itself.
21) In the aforesaid backdrop, the short question which arises for our
consideration is whether the Petitioner is justified in contending that the
conduct of MMRDA in proceeding to open the financial bids without first
declaring the Petitioner's technical bid as unresponsive is contrary to the
terms of the tender.
22) We have heard Learned Senior Counsel and perused the papers,
particularly the terms of the ITB, and after doing so, find that we are
unable to entertain the present Writ Petition for the following reasons:
A. The Petitioner's case was entirely premised upon a reading of clauses
27.7 and 27.8 of the ITB, and infact, it is only an extract of those clauses
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which has been appended to the Writ Petition at Exhibit D. The submissions
advanced by Mr. Dwarkadas were also based entirely on these clauses. We
find that the Petition is entirely silent on clauses 28.1 and 42.5, which in
terms set out that information relating to the evaluation of bids shall not be
disclosed till such time as the notification of the award. In our view, it was
incumbent upon the Petitioner to have set out the said clauses and
explained why the same were not applicable. The Petitioner has admittedly
not done so, and thus we find much merit in the submission of Mr. Rohatgi
that the Petitioner is guilty of suppression of a material fact.
B. It is well settled that the party who invokes the extraordinary
jurisdiction of this Court is supposed to be truthful, frank and open and
must necessarily disclose all the material facts without any reservation,
even if they are against such party. It is not open to a Party who seeks
equity to play "hide and seek" or to "pick and choose" certain facts and to
suppress and/or conceal other facts. These principles are categorically laid
down by the Hon'ble Supreme Court in the case of K.D. Sharma (supra). In
the present case, as already noted above, the Petitioner has entirely
suppressed clauses 28.1 and 42.5 of the ITB from the Petition.
C. Though, we prima facie find merit in the contention of Mr. Dwarkadas
that the tender conditions are not in conformity with the ITB and CVC
guidelines explicitly provide that MMRDA shall, after notification of the
award of the contract and upon receiving a request from the unsuccessful
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bidder, provide to the unsuccessful bidder reasons for its disqualification.
The Petitioner having accepted clause 28.1 and 42.5 of the ITB, cannot at
this stage assert a right which is contrary to the express terms of the tender
or seek to interpret the terms of the tender in a manner which is contrary to
the interpretation placed by MMRDA. Further, in light of the Learned
Solicitor General's statement as recorded in paragraph 20 it would be open
to the Petitioner to raise all these contentions once the reasons for the
rejection of the technical bid are made available to the Petitioner as per the
ITB. Thus, in the facts of the present case, the Petitioner's reliance on the
judgements in Haffkine Bio-Pharmaceutical Corporation Limited, Surendra
Infrastructure (P) Ltd., Reliance Energy Ltd. & Anr., Food Corporation of
India, and Konkan Railway Corporation would be of no assistance at this
stage.
D. Another factor which we must be mindful of is that the said project is a
mega-infrastructure project of significant public importance. Thus, any
delay of the same would adversely impact the execution of the project,
which is admittedly of public importance. Conversely, no prejudice
whatsoever would be caused to the Petitioner if all rights and contentions
of the Petitioner are kept open to challenge the rejection of the Petitioner's
technical bid as well as the award of the contract. The rights of the
Petitioner would remain intact, as opposed to the grave prejudice that
would be caused in the case of any delay to the project. We find no merit in
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the Petitioner's contention that there has been delay on the part of MMRDA,
since the technical bids were submitted in January 2025 and have only
been evaluated now. Given the magnitude of the project, such evaluation
would take time. Also, even assuming there has been a delay on the part of
MMRDA, that itself does not mean that the project can be further delayed
pending consideration of a challenge, which it is made expressly clear can
be raised after the award of the contract.
23) Accordingly, the interim stay on the opening of the financial bids is
discontinued forthwith.
24) Hence, for the aforesaid reasons, the Petition is dismissed. There shall
be no order as to costs.
(ARIF DOCTOR, J.) (KAMAL KHATA, J.)
25) After pronouncement of Judgment, Mr. Dwarkadas submits that price
bids submitted electronically should be preserved till the communication of
the Award as per the ITB clauses.
26) This being a fair request is granted and not being opposed by learned
Solicitor General. The MMRDA is directed to preserve the price bids for two
weeks from the date of communication to the Petitioner.
(ARIF DOCTOR, J.) (KAMAL KHATA, J.)
