Telangana High Court
Telangana Mineral Development ... vs Gkr Infracon India Private Limited. on 27 March, 2025
THE HON'BLE THE ACTING CHIEF JUSTICE SUJOY PAUL
AND
THE HON'BLE SMT. JUSTICE RENUKA YARA
WRIT APPEAL No.180 OF 2025
JUDGMENT:
(Per Hon'ble Smt. Justice Renuka Yara)
Heard Sri T.Rajinikanth Reddy, learned Additional Advocate
General appearing for the appellants and Sri Tarun G.Reddy, learned
counsel for respondent Nos.1 and 2. Perused the record.
2. This is an intra-court appeal filed by the appellants/respondent
Nos.1 and 2 aggrieved by the order dated 28.10.2024 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/2024/225, dated 14.06.2024
for de-siltation of 6,00,283.55 MT of sand from Mahadevpur/2024/2
sand reach at Jayashankar Bhupalpally District as illegal for not
assigning reasons, the award of tender No.TGMDC/S&M/DSLT/
JB/2024/225, dated 14.06.2024 in favour 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/2024/225,
dated 14.06.2024.
3. The background facts of the case are that the writ appellant
No.2 floated tender No.TGMDC/S&M/DSLT/JB/2024/225, dated
14.06.2024 for de-siltation of 6,00,283.55 MT of sand from
Mahadevpur/2024/2 sand reach at Jayashankar Bhupalpally
District and that the said tender was floated for a contract value of
approximately Rs.5,82,27,504/-. Respondent No.1 represented by
respondent No.2 and respondent No.3 participated in the bid. The
bid was awarded in favour of respondent No.3 as per the award dated
19.07.2024. The bid submitted by respondent No.1 has been
rejected as per the information provided in the Telangana
e-procurement portal.
4. The rejection of their bid is challenged by respondent Nos.1 and
2 on the premise that the writ appellants did not conduct the tender
process and awarding of the tender in fair and transparent manner
by referring to the legal ratios laid down by the Hon'ble Supreme
Court of India in Dharmapal Satyapal Limited v. Deputy
Commissioner of Central Excise, Gauhati and others 1, PKF
Sridhar and Santhanam v. Airports Economic Regulatory
Authority of India (WP(C) No.12385 of 2021), Swadeshi Cotton
Mills v. Union of India 2 and Punjab State Power Corporation
Limited and another v. EMTA Coal Limited and others 3.
Respondent Nos.1 and 2 primarily questioned the action of writ
appellants in rejecting the tender without assigning reasons and
(2015)8 SCC 519
AIR 1981 SCC 818
(2022)2 SCC 1
without giving them hearing for giving clarification on their Work
Done Certificate. 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 natural 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.1's
specific case that it fulfilled 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 19.07.2024, the writ appellants have
clearly observed that respondent No.1 has fulfilled the eligibility
criteria referring to the contents of Remarks column which are
extracted and produced below:
Remarks
As per Tender Document
5. Further, the learned Single Judge held that the writ appellants
have failed to give an opportunity to respondent No.1 to give
clarification in case of any ambiguity about the contents of the Work
Done Certificate. Lastly, the learned Single Judge also referred to the
writ appellants issuing Letter of Intent to respondent No.3 on
10.07.2024 and the award of tender to respondent No.3 took place on
19.07.2024. Thus, the writ petition was allowed leading to filing of
the writ appeal.
6. The learned Additional Advocate General would submit that the
Government followed correct procedure as spelled out in the
procurement manual and the tender notification. It is emphasized
that respondent No.1 failed to meet the tender condition No.3.2,
which reads as follows:
"The bidder shall have satisfactorily completed at least one work of
Mining/Civil/Irrigation work of value not less than Rs.4,65,82,003/- (Rupees
Four crore Sixty Five lakhs Eighty Two thousand and Three only) (80% of value of
work) involving excavation and removal any Earth/mineral including sand in
State/Central Government Undertakings during the last three (3) years."
7. In this regard referring to the Work Done Certificates vide
Ref.Nos.KGM/JVR OC-II/2023/338C/608 and KGM/JVR OC-
II/2023/338D/609, both dated 12/16.05.2023 submitted by
respondent No.1, it is argued that said certificates clearly
demonstrate that respondent No.1 did not complete the contracts but
rather the work is still in progress in "Present status of work"
column.
8. In that context, it is argued that any bidder has to produce
certificate showing satisfactorily completed work of value not less
than Rs.4,65,82,003/- during the last three years of the bid. It is
argued that among 15 technical qualified bidders, 9 were rejected for
not complying tender clause 3.2 and the same was informed through
e-procurement website on 08.07.2024. Respondent No.1 is one
among 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 Private
Limited v. Resourys Telecom and others 4, wherein it is held that
"The above mentioned statements of law make it amply clear that the author of
the tender document is taken to be the best person to understand and appreciate
its requirements; and if its interpretation is manifestly 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 technical 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 acceptable to the
constitutional court, that, by itself, would not be a reason for interfering with the
interpretation given."
9. The contention of respondent No.1 about giving opportunity
under clause 21 to provide clarification with respect to Work Done
(2022)5 SCC 362
Certificate, it is argued that the employer can seek clarification at its
discretion. When the Work Done Certificate itself clearly reflected
that respondent No.1 did not complete the work, there is no need to
seek any clarification. Lastly, it is argued that the learned Single
Judge erred in observing that the letter of intent dated 10.07.2024
was issued in favour of respondent No.2 and the same is contrary to
the information on the web site which shows tender was awarded on
19.07.2024. According to the learned Additional Advocate General,
after the bids were submitted by prospective bidders, the bids were
evaluated by the Tender Evaluation Committee on 08.07.2024 to
ascertain the conditions stipulated and successful bidder was issued
the letter of intent on 10.07.2024 and said information was uploaded
on 19.07.2024. In the entire process, there is no mala fide or lack of
transparency. Learned Additional Advocate General referred to
judgment in W.A.Nos.116 and 117 of 2025, dated 13.02.2025
wherein it was held that:
"16. A careful reading of Clause 17.0 reproduced hereinabove shows that if
bidder has been banned by any other body and has disclosed this fact clearly in his
bid, as a rule of thumb, SCCL management will not disqualify him. The SCCL
management reserves right to take appropriate decision in such eventuality. The
language employed in the aforesaid clause shows that it enables the SCCL
management to take an appropriate decision in such cases where disclosure of
banning is there. The decision taken by SCCL management in the present case is to
disqualify the petitioner. At this stage, we are not inclined to put the clock back and
direct the Singareni Collieries Company Limited to undertake the entire exercise
afresh. The Singareni Collieries Company Limited is serving public interest. For the
smooth production and running of Singareni Collieries Company Limited, supply of
bulk explosive is essential. Any interference by us at this juncture, will hamper the
activity of the industry and consequently will have an adverse impact on public
interest. Thus, in the peculiar facts of these cases, we are not inclined to interfere in
the matter. More-so, after passing of impugned order, third party rights 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.
11. Learned counsel for respondent Nos.1 and 2 argued that it has
fulfilled condition under clause 3.2 of tender conditions and therefore
it was found to have qualified as per the entry in web portal dated
19.07.2024. 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 clarification about the Work Done Certificates 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 Lal Lakshi Reddy, rep. by its
partner Shri Kasturi Lal and others v. State of Jammu and
Kahsmir and another 5, wherein it is held that
"15.........Where the government is dealing with the public, whether by way of giving
jobs or entering into contracts or granting other forms of largess. the Government
cannot act arbitrarily at its, sweet will and, like a private individual, deal with any
person it pleases, but its action must be in conformity with some standard or norm
which is not arbitrary, irrational or irrelevant. The governmental action must not be
(1980)4 SCC 1
arbitrary or capricious, but must be based on some principle which meets the test of
reason and relevance..."
12. Learned counsel for the respondents vehemently argued that
no reasons are assigned for rejecting its bid and thereby there is
violation of principles of natural justice. In that context, learned
counsel for the respondents referred to judgment of the Hon'ble
Supreme Court of India in Dharmapal's case (1 supra) and relevant
portion is extracted and produced below:
"The principles of natural justice developed over a period of time and which is still in
vogue and valid even today were: (i) rule against bias, i.e. nemo iudex in causa sua;
and (ii) opportunity of being heard to the concerned party, i.e. audi alteram partem.
These are known as principles of natural justice. To these principles a third principle
is added, which is of recent origin. It is duty to give reasons in support of decision,
namely, passing of a 'reasoned order'.
13. Analysis by the Court:
A perusal of the record and the arguments of both the counsel
show that the crux of the dispute is with respect to whether or not
respondent No.1 met the criteria under clause 3.2 of tender
conditions, whether the writ appellants acted with mala fides in not
providing an opportunity to respondent No.1 to give clarification
about its Work Done Certificate and lastly whether the writ
appellants did not give a reasoned order for rejection of bid submitted
by respondent No.1 and thereby the tender process lacks
transparency.
14. 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.4,65,82,003/- (80% of value of work)
involving excavation and removal any earth/mineral 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.1
shows that the said company has taken up the work of Singareni
Collieries through work order No.7600009282, dated 21.10.2022 and
has completed certain work upto March 2023 and 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.1 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
conditions and not otherwise. The contents of the Work Done
Certificate speak for themselves and cannot be given any other
interpretation. The respondents would contend that the contracts
awarded are for a period of 11 months and 17 months respectively
and each component of work done is a separate piece work which is
to be treated as completed satisfactorily. Such interpretation of the
contents of the Work Done Certificates is not acceptable.
15. Coming to the aspect of seeking clarification from the bidder as
per clause 21 of tender conditions, said tender condition itself clearly
shows that the clarification may be sought at the discretion of the
employer. In case, the employer after perusing the contents Work
Done Certificate has come to the conclusion that the work is still in
progress and that has not been completed, no fault can be found
with the employer. A conjoint reading of clause 3.2 and 21 of the
tender conditions together with the contents of Work Done
Certificates does not make out a positive case in favour of respondent
No.1.
16. Coming to the contention of respondent Nos.1 and 2 that as
per clause 22.1, the eligibility criteria is as per definition ITB clause 3
and only when the eligibility criteria is met, the further evaluation
takes place. To ascertain the case of respondent Nos.1 and 2, said
entry in the web portal is produced below:
Technical parameters list:
Para Parameter Operat Date Min Max Parameter Fulfill Remarks Evaluation
meter Description or Type Value value ed comments
value
name
As per As per Text 0.00 0.00 Yes Yes As per Clause 3.2
tender tender Tender of Tender
docu document Document conditions
ment not
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.1 to mean that respondent No.1 has
met the eligibility criteria as per 3.2. To the contrary, the meaning of
the contents of "Remarks" column can be construed as that
respondent No.1 qualified for further evaluation of the bid as it has
met the eligibility criteria by filing 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 filed
all the documents or not. Only such bidders who have filed all the
documents are eligible for evaluation 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
contents of the Remarks column are meant for noting down the
eligibility of a bidder prima facie on account to filing of required
documents as per tender notification and not on the basis of contents
of said documents. Only after the documents filed for the evaluation
of the bid are in order, the contents are examined and an evaluation
is made as to the eligibility of the bidders and thereby respondent
No.1 has been found to be lacking to have met the conditions under
clause 3.2. However, respondent No.1 is mis-interpreting the
contents of "Remarks" column and the "evaluation comments"
column and the same has been erroneously relied upon by the
learned Single Judge while passing the impugned order.
19. Coming to the aspect of observing principles of natural justice,
about passing a reasoned order while rejecting an application, a
reasoned order is passed when there is an adjudication process,
where there are two or more rival contestants, each person is heard
and an evaluation is made of the rival contentions and reasoned
order is passed. In the instant case, the entire tender process took
place online wherein the bids are submitted online and the result
also has been declared online. A reason for rejection is the criteria
for meeting the requirements of principles of natural justice. The
said reasoned order could be one word, one line or a paragraph or
more. In the instant case, the employer has given the reason for
rejecting bid of respondent No.1 by stating that respondent No.1
failed to meet the conditions of clause 3.2 of tender conditions. The
said reason when written in one line or in an elaborate manner
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 10.07.2024 while the
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 filing a rejoinder to the counter filed by respondent No.3.
21. In this regard, as per judgment of the Hon'ble Supreme Court
in Arti Sapru v. State of Jammu and Kashmir 6, the allegations
made for the first time in the rejoinder affidavit 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 v. Rishi Dikshit 7, the Hon'ble
Supreme Court held 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 cannot be relied
upon. While legal precedents do not support respondent No.1's
(1981)2SCC 484
(2006)9SCC 90
allegations made in the rejoinder for the first time attributing mala
fides, we are of the considered opinion that the contents of the web
portal dated 19.07.2024 are also mis-interpreted on account of the
fact that the tender evaluation process has been completed by
08.07.2024 and the letter of intent was issued to the successful
bidder on 10.07.2024 and said information was uploaded in the
website on 19.07.2024. Last but not least, after the bids are
evaluated, the eligible bidder has been selected by way of lottery in
the presence of all the bidders. The learned Additional Advocate
General pointed out that even respondent No.1 participated in the
lottery process that took place on 10.07.2024 and therefore, no mala
fides can be attributed to reference Nos.1 and 2, as the entire process
has been conducted in transparent manner as per the tender process
contemplated in the tender conditions as well as notification. When
the successful bidder is selected through the process of drawing lots
in the presence of all the eligible bidders, no mala fides can be
attributed to the writ appellants in conducting the tender process in
fair and transparent manner.
22. For the foregoing reasons, we are of the considered opinion that
the learned Single Judge erred in reading the contents of the Work
Done Certificates, the e-procurement award dated 19.07.2024 and
the factum of issuance of letter of intent dated 10.07.2024 and
publishing said information on 19.07.2024 in the e-procurement
online website and therefore the said impugned 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 28.10.2024 in W.P.No.21975 of 2024 passed by the learned
Single Judge. There shall be no order as to costs.
Miscellaneous applications, if any, pending in this appeal, shall
stand closed.
___________________
SUJOY PAUL, ACJ
____________________
RENUKA YARA, J
Date: 27.03.2025
ssp
