M/s AGMATEL INDIA PVT. LTD vs M/s RESOURSYS TELECOM

M/s AGMATEL INDIA PVT. LTD vs M/s RESOURSYS TELECOM - Supreme Court Case 2022

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 786 OF 2022
(ARISING OUT OF SLP(C) No. 16671 OF 2021)
M/s AGMATEL INDIA PVT. LTD. .………APPELLANT(S)
 VERSUS
M/s RESOURSYS TELECOM & ORS. ………RESPONDENT(S)
WITH
C.A. NO. 787 OF 2022
(ARISING OUT OF SLP(C) No. 16672 of 2021)
JUDGMENT
Dinesh Maheshwari, J.
Contents
Preliminary.................................................................................................................1
Relevant Factual Matrix and Background..................................................................3
High Court disapproves the decision of tender inviting authority.............................7
Rival Submissions....................................................................................................16
Interpretation of Tender Document: Relevant Principles.........................................23
Application of relevant principles to the case at hand.............................................28
Conclusion................................................................................................................44
Preliminary
Leave granted.
2. These two appeals against the same judgment and order dated
27.09.2021, as passed by the High Court of Delhi at New Delhi in Writ
Petition (C) No. 6676 of 2021, have been considered together and are
taken up for disposal by this common judgment.
1
2.1. By the impugned judgment and order dated 27.09.2021, the High
Court has accepted the writ petition filed by the respondent No. 1 of these
appeals (M/s. Resoursys Telecom- hereinafter referred to as ‘the writ
petitioner’) and has disapproved the technical disqualification and
consequential rejection of the technical bid of writ petitioner in respect of
a tender floated by the appellant of the appeal arising out of SLP(C) No.
16672 of 2021 (Navodaya Vidyalaya Samiti – hereinafter referred to as
‘NVS’). The appellant of the other appeal arising out of SLP(C) No. 16671
of 2021 (Agmatel India Pvt. Ltd. – hereinafter referred to as ‘Agmatel’) is
said to be the bidder whose offer was accepted by NVS after technically
disqualifying the writ petitioner.
3. The crux of the matter involved in these two appeals is as to
whether the High Court has been justified in interfering with the view
taken by the tender inviting authority, i.e., NVS, in rejection of the
technical bid of writ petitioner for want of fulfilment of ‘Past Performance’
criterion about supply of ‘same or similar Category Products’ of 60% of
bid quantity in at least one of the last three financial years?
3.1. It may be observed at the outset that a contention had also been
urged, particularly on behalf of Agmatel, that the High Court of Delhi had
no jurisdiction to entertain the subject writ petition when all the material
events took place in the State of Uttar Pradesh and when the tender
inviting authority was also in the State of Uttar Pradesh. The High Court
has rejected this objection with reference to the fact that such an
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objection was not taken by the tender inviting authority-NVS, who was
even otherwise operating under the Department of School Education and
Literacy, Ministry of Human Resources Development, New Delhi. This
aspect has not been given much emphasis before us and we would also
leave it at that only, while dealing with the matter on its merit.
4. It may also be observed that while considering these appeals
initially on 29.10.2021, we had considered it appropriate to take up the
matters for final hearing at the admission stage itself, particularly looking
to the object of the tender process in question, for that being related with
education of the children. However, in the circumstances of the case, we
had stayed the operation of the impugned order of the High Court while
providing that status quo in relation to the tender process in question shall
be maintained by all the concerned. After completion of pleadings, we
have heard learned counsel for the parties finally at the admission stage.
5. After the foregoing preliminary comments, we may take note of
the factual aspects in brief, and insofar as relevant for the issues at hand.
Relevant Factual Matrix and Background
6. The dispute in the present appeals has its genesis in a Notice
Inviting Tenders (‘NIT’) bearing No. GEM/2021/b/1032762, as issued by
the appellant-NVS on 12.02.2021 on the Government online portal i.e.,
Government e-market Place (‘GeM’) for supply of 68,940 Tablets for
school children. The NIT carried with it several of the terms and
3
conditions but, we are concerned in the present appeals with the terms
and conditions pertaining to ‘Experience’ and ‘Past Performance’ of the
bidders. The relevant terms and conditions may be extracted as under: -
“1. Experience Criteria: In respect of the filter applied for
experience criteria, the Bidder or its OEM {themselves or
through reseller(s)} should have regularly, manufactured
and supplied same or similar Category Products to
any Central / State Govt Organization / PSU / Public
Listed Company for number of Financial years as
indicated above in the bid document before the bid
opening date. Copies of relevant contracts to be
submitted along with bid in support of having supplied
some quantity during each of the Financial year. In case
of bunch bids, the category of primary product having
highest value should meet this criterion.
****** ***** ******
4. Past Performance: The Bidder or its OEM {themselves
or through re-seller(s)} should have supplied same or
similar Category Products for 80% of bid quantity1
, in
at least one of the last three Financial years before
the bid opening date to any Central/State Govt
Organization / PSU / Public Listed Company. Copies
of relevant contracts (proving supply of cumulative order
quantity in anyone financial year) to be submitted along
with bid in support of quantity supplied in the relevant
Financial year. In case of bunch bids, the category
related to primary product having highest bid value
should meet this criterion.”
Bid Specific Additional Terms and Conditions
“****** ***** ******
3. The Bidder / OEM {themselves or through reseller(s)},
should have executed project for supply and installation/
commissioning of same or similar Category Products
during preceding 3 financial years (i.e. current year and
three previous financial years) as on opening of bid, as
per following criteria:
(i) Single order of at least 35% of estimated bid value; or
(ii) Two orders of at least 20% each of estimated bid
value; or
(iii) Three orders of at least 15% each of estimated bid
value.
****** ***** ******
1 This quantity requirement of 80% was admittedly reduced to 60% by way of a
corrigendum issued by the tender inviting authority.
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14. Experience Criteria: The Bidder or its OEM
{themselves or through reseller(s)} should have regularly,
manufactured and supplied same or similar Category
Products to any Central/ State Govt Organization /
PSU / Public Listed Company for 3 years before the bid
opening date. Copies of relevant contracts to be
submitted along with bid in support of having supplied
some quantity during each of the year. In case of bunch
bids, the primary product having highest value should
meet this criterion."
(emphasis in bold supplied)
6.1. It is the requirement concerning “same or similar Category
Products” in the aforesaid conditions which forms the bone of contention
in these appeals.
7. The writ petitioner M/s. Resoursys Telecom responded to the said
NIT and offered its bid for the product i.e., “Tablet” which is being
manufactured by an Indian company namely, Lava International Limited,
after having necessary approvals from the manufacturer (OEM). After
opening the technical bids on 08.05.2021, the appellant-NVS rejected the
bid of the writ petitioner on 25.06.2021, while stating the reason of
rejection as ‘technical specification mismatch’. The writ petitioner felt that
the grounds for rejection were not discernible and the rejection was vague
and ambiguous; and, therefore, made a representation dated 27.06.2021
seeking clarification of the reason for rejection. The appellant-NVS, in its
reply dated 29.06.2021, inter alia, stated as under: -
“1.Does not qualify past Performance (Page 124) of
tender document for any of the FY 2018-19, 2019-20,
2020-21. Work Orders of Smart Phones, Laptops, Aadhar
Kits, Printers, Power-bank, etc are not considered as
same or similar category products of tablets.”
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7.1. The writ petitioner M/s. Resoursys Telecom, as also the said OEM
Lava International Limited submitted further representations while
maintaining that they were duly complying with the Past Performance
clause of the tender document. The appellant-NVS stated in its response
dated 01.07.2021 that they were procuring “Tablets” for learning
management and the Technical Evaluation Committee (‘TEC’) has
considered only “Tablets” under similar category ‘to ensure proven
products’.
8. At this juncture, we may take note of the facts emerging on record
that the writ petitioner, in order to assert its fulfilment of the above referred
Past Performance criterion, has relied upon the statements made by its
OEM in the letter dated 16.04.2021, wherein the supplies made in the
financial year 2019-2020 to Punjab Infotech, Directorate of Welfare of
Scheduled Castes-Assam, Directorate of Welfare of Plain Tribes &
Backward Classes–Assam, and Directorate of Women and Child
Development Kerala were referred and it was also stated that they had
received the biggest purchase order of 1,75,443 units of “Smart Phones”
from Punjab Infotech and supplied the device successfully. We shall be
adverting to the relevant details of the said letter dated 16.04.2021
hereafter later, in the segment of discussion.
8.1. It has been the case of the appellants that in the aforesaid
supplies, only smart phones were supplied to Punjab Infotech and to the
Directorate of Women and Child Development, Kerala; and the product
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“Smart Phone” does not fall within the description of “same or similar
Category Product” vis-à-vis the product required under the NIT in
question, i.e., “Tablet”.
9. Being aggrieved by the decision taken by the tender inviting
authority, the writ petitioner M/s. Resoursys Telecom preferred the writ
petition leading to these appeals with the submissions, inter alia, that the
process in question was vitiated due to an arbitrary and whimsical
decision taken by the tender inviting authority. During the pendency of writ
petition, it was informed by the tender inviting authority that the contract in
question had been awarded to the other bidder who was found qualified
and successful; and the application for impleadment made by the said
successful bidder-Agmatel was allowed by the High Court.
High Court disapproves the decision of tender inviting
authority
10. In essence, the submission of the writ petitioner before the High
Court was that a “Tablet” was an electronic product belonging to the
“same or similar category” as a “Smart Phone”; and that the decision of
the NVS, excluding “Smart Phones” from “same or similar Category
Products” was unreasonable and against the principles of fair play and
logic. On behalf of the writ petitioner, strong reliance was placed on
various tender notices issued by other departments and institutions,
including the Electronic and Information Technology Departments of the
States of Kerala, Himachal Pradesh, Bihar and Meghalaya; and it was
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submitted that in all such tender notices, the past experience of supply of
tablets and smart phones had been treated alike. On the other hand, it
was submitted on behalf of the tender inviting authority-NVS that the
products like tablets, computers and smart phones were electronic goods,
distinguishable on the basis of their technical, commercial and traderelated definitions, norms, and regulations provided by the authorities
concerned. It was also argued that the tender inviting authority was the
best person to interpret the terms of tender, and its decision could only be
examined in case of it being arbitrary, biased or mala fide; and no such
case being alleged, no interference was called for. The same contentions
were urged on behalf of the impleaded party-Agmatel, while also raising
the objection of jurisdiction.
11. While dealing with the rival contentions, the High Court of Delhi,
after rejecting the contention on jurisdiction, formed the view that the
product “Smart Phone” was definitely a similar category product as
“Tablet”; and the tender inviting authority as also its TEC had been
unjustified in giving a restrictive meaning to the terms of NIT; and if at all
there was any ambiguity, the tender inviting authority cannot be left to the
option of interpreting the terms contrary to their plain meaning. The High
Court, therefore, proceeded to allow the writ petition and disapproved the
rejection of technical bid of the writ petitioner. It shall be appropriate to
summarise the relevant aspects of the reasons that prevailed with the
High Court in allowing the writ petition.
8
11.1. The High Court took note of the contentions that the tender
floating authority was the best judge to determine the conditions of a
tender but, in that regard, referred to a passage from the decision of this
Court in the case of Reliance Energy & Anr. v. Maharasthra State
Road Development Corporation Ltd & Ors.: (2007) 8 SCC 1 to the
effect that in invitation to tenders, the terms and conditions must indicate
the norms and benchmarks with legal certainty; and if there be any
vagueness and subjectivity in the said norms, it may result in unequal and
discriminatory treatment and violate the doctrine of “level playing field”.
The High Court, thereafter, observed that it was nobody’s case that
“Smart Mobile Phones” were the “same” category products as “Tablets”;
and that the issue was as to whether under the terms of NIT, “Smart
Mobile Phones” could be called “similar Category Products” as “Tablets”.
11.2. Thereafter, the High Court referred to the aforementioned terms
and conditions of NIT and opined that when the expression used had
been “category” before the word “product” and with the qualifying
expression “similar”, the intendment was not to exclude such products
which were of “similar category”; and the intention had not been to insist
only for “same” category products. Having thus minutely analysed the
expressions “same”, “similar” and “category” as also the related
semantics, the High Court proceeded to indicate the perceived similarities
of the two products, i.e., “Smart Phones” and “Tablets” including that both
were electronic products; were used for audio-visual
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reception/transmission of data; were having facilities of running
programmes and applications; were sold and traded through the same
channels and were likely to be found in the same shop; and were being
sold by the large manufacturers and producers under the same brand.
The High Court, thus, concluded that even if the said two products were
not the “same”, it would not mean that they do not belong to “similar
Category of Products”. The High Court further said that the interpretation
prevalent in the market, where these products were treated as falling in
“similar” category, was demonstrated by the writ petitioner with reference
to five tenders floated by different Governments/PSUs in different parts of
the country. Applying such test, the High Court concluded that NVS could
not have excluded the product “Smart Mobile Phones” from the “similar”
category vis-a-vis the product “Tablets”. According to the High Court, the
clause in question had been so worded as to provide maximum
competition. These observations and findings of the High Court, forming
the core of its decision, could be usefully reproduced as under: -
“29. From the above, it would be seen that the author of
the tender in question has consciously and repeatedly
used the expression “Category” before the word
“Product”. Thus, the use of the expression “Category” is
not inadvertent, or unintentional. Secondly, the author
has also repeatedly used the words “same or similar” in
relation to – not the product in question, but in relation to
the category of products to which “Tablet” belongs. The
use of the plural i.e. “Products”, and not “Product” also
shows that the author was conscious that within the
same or similar category of products, there would be
products other than “Tablets”. Pertinently, the expression
used is not “same products”, or even “same Category
Products”. It is “same or similar Category Products”.
Firstly, the use of the word “Category” shows that not just
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the same product, but all products which fall in the same
category which are covered. Thus, if the expression used
would have been “same Category Products”, other
products which fall in the same category – as a Tablet,
would be covered. The respondents have themselves
enlisted other products which fall in the same category of
products, as Tablets. They are “Slate tablets, Convertible
Tablets, Hybrid Tablets, Phablets, Rugged tablets, Tough
Tablets, Booklet, Microsoft Surface, Amazon Kindle Fire,
Surface Pro Tablet PC, iPad, iPad Air, iPad Pro, iPad
Mini, Samsung Galaxy Tab, and ThinkPad.” However, the
respondent NVS has further enlarged the scope, by using
the expression “similar Category Products”. By using this
expression, all products which fall in similar categories –
to the category in which Tablets fall, are also covered.
The expression “similar” does not mean “same”.
Therefore, a thing which is “similar” to another, would not
be the same as that other. In the present context, the
word “similar Category” has to be understood in relation
to the nature and usage of the categories of products
being compared. According to the Cambridge Dictionary,
the word “same” means “exactly like another or each
other”, whereas the word “similar” means “looking or
being almost, but not exactly, the same”. Thus, if it was
indeed the intent of the Respondent to exclude similar
category products, from the category of products in which
“Tablet” falls, they need not have used the words “same
or similar category products”. They would have simply
said “same products”, or “same category products”
30. Both smart mobile phones, and Tablets, are electronic
products. Both are used for audio-visual reception/
transmission of data. Both have facility of running
programmes and applications to perform varied tasks,
such as, receiving and sending messages/ e-mails,
surfing internet, downloading content from the internet,
viewing audio-visual content, transmitting audio-visual
and the like. Both also have the facility to make audio
calls through data networks – though, mobile phones use
the mobile call network for regular calls. Both these
products are sold and traded through the same channels.
In the same shop, which sells smart mobile phones, one
is likely to find Tablets, and vice versa. In fact, the larger
manufacturers and producers of electronic goods
produce and sell both – smart mobile phones, and tablets
under the same brand. There are bound to be
differences, since these two products are not “same”.
They may not even belong to the “same category” of
products. However, merely because they are not “same”,
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it does not mean that they do not belong to “similar
category of products”.
31. The terms of tender must receive the natural and
commonly understood interpretation, which has been
prevalent in the trade. What is prevalent in the trade has
been demonstrated by the petitioner – by reference to the
5 tenders floated by different Government/ PSUs in
different parts of the country for same/ similar products.
32. Applying the said test, can it be said that the
respondent NVS could exclude smart mobile phones
from the similar category of products, as Tablets? The
answer is an emphatic “No”. The Clause, intentionally,
has been worded loosely in order to have maximum
competition amongst bidders.”
11.3. Thereafter, the High Court took note of the stand taken by NVS in
its reply dated 01.07.2021 and that taken in the counter affidavit filed
before the Court and observed that the TEC of NVS, on its own, had
decided to curtail the competition by narrowing the scope of the eligibility
criteria by taking only tablets as falling under “similar” category and not
considering the past supplies of other products like smart mobile phones,
laptops etc. The High Court, however, observed that exclusion of the
products like Aadhaar kits, printers, power-banks etc. was not being
considered and the TEC might have been justified in not considering
them as falling under “similar” category products but, the TEC could not
have gone outside the scope of tender. The Court further observed that in
the counter affidavit, the averment had been to the effect that the
“Tablets” and “Smart Mobile Phones” were not of “same” product or
“similar” product but the criterion had been of “similar Category of
12
Products” and these words were not of surplusage. The High Court
disapproved the stance of NVS, as being not in conformity with open
competition and found it unacceptable in public interest. The High Court
observed and held thus: -
“36. Thus, it is evident to us that the Technical Evaluation
Committee (TEC) of the respondent NVS, on its own
decided to curtail the competition by narrowing the scope
of the eligibility criteria, by consideration of only Tablets
as falling under similar category, and not to consider past
supplies for other products like smart phones, laptops,
etc, which are covered under “same or similar category
products”, as tablets. We are not concerned with the
exclusion of products like Aadhar kits, printers, power
bank, etc. in the facts and circumstances of the present
case. The TEC of the respondent NVS may have been
justified in not considering past experience/ turnover of
supply of products like aadhar kits, printers, power banks,
etc., as falling under similar category products, as that of
the tablets. However, the TEC of the respondent NVS
could not have gone outside the scope of the tender to
lay down its own criteria to determine the eligibility of the
bidders. They were bound to adhere to, and strictly
comply with the terms and conditions stipulated in the
tender floated by NVS. The decision taken by the TEC to
exclude from consideration all other similar category
products – for the purpose of evaluating past
performance of the bidders, was wholly incompetent and
beyond the authority of the TEC.
37. From the counter affidavit, we also find that at various
places, the respondent has averred that Tablets and
smart mobile phones are not the same product, or similar
product. It appears to us that the respondent has
forgotten the eligibility criteria set out in the NIT, which is,
“same or similar category products”, and not “same
product” or even “similar products.”
38. If that interpretation as given by the respondent NVS
were to be accepted, the word “similar category of
products” becomes a surplusage, which cannot be the
intention attributed to the tender framing authority.
39. To arbitrarily and whimsically change the goalpost,
and determine what can, and cannot, be considered a
“similar product”, at the time of evaluation of bids,
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disrupts the level playing field for bidders and
extinguishes healthy competition. The respondents have
argued that smartphones and tablets are separate
products, and there can be no doubt about it. This is a no
brainer. However, they don’t say that these two products
are not even falling under two different similar categories
of products.
40. The restrictive interpretation given by the respondent
NVS to the aforesaid tender conditions – not borne out
from the tender terms and conditions, which would curb
competition, does not find favour with the Court, in Public
Interest. The whole purpose of issuing a tender is to
invite maximum bids from bidders meeting the technical
qualification so that the employer/ tender floating
authority gets the most favourable product/services, at
the most competitive price.”
11.4. The High Court, thereafter, referred to a decision of this Court in
Nabha Power Ltd. v. Punjab SPCL: (2018) 11 SCC 508 for application
of the “five condition test” for an implied condition to be read into the
contract, including the “business efficacy test” and highlighted the
principles laid down by this Court that “implied term” was a concept
necessitated when the referred five conditions were satisfied and there
was a strict necessity for it. On that basis, the High Court observed that
NVS could have neither implied any term in the tender nor given
restrictive meaning to the clear language of the tender. The High Court,
thereafter, referred to the doctrine of ‘Contra proferentem’, as referred to
in the case of United India Insurance Co. Ltd. v. Orient Treasures (P)
Ltd.: (2016) 3 SCC 49, whereby, any ambiguity in an insurance policy
would be resolved by a construction favourable to the insured. The High
Court observed and held that if at all there was an ambiguity, it would be
construed against the drafter of the tender; and in the absence of
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ambiguity, the plain meaning of the condition must be complied with.
Having said so, the High Court observed that each and every word of a
tender must be given a meaning, for it being a serious exercise; and TEC
cannot evolve its own criteria to evaluate the eligibility of bidders, contrary
to the terms and conditions of the tender.
11.5. Before concluding on the matter, the High Court observed, with
reference to the decision of this Court in Tata Cellular v. Union of India:
(1994) 6 SCC 651, that the tender floating authority was the best person
to interpret the terms of the tender but the said authority cannot act
arbitrarily, whimsically or contrary to the terms and conditions of the
tender. The High Court reiterated that in the first place, the terms and
conditions were clear and if at all they were ambiguous, it could not be left
to the option of tender floating authority to interpret it in a manner which is
contrary to their plain meaning. The High Court said thus: -
“47. We are conscious of the scope of judicial scrutiny in
tender matters. We are also conscious that the tender
floating authority is best person to interpret the terms of
the tender, as they know what best is the requirement
and how to achieve the same. (see Tata Cellular v. UOI
(1994) 6SCC 651) However, the authorities cannot act
arbitrarily, whimsically and contrary to the terms and
conditions of the tender. As noticed hereinabove, the
terms and conditions of the tender are clear. However,
even if the terms of the tender are unclear and
ambiguous, can it be left to the option of the tender
floating authority to interpret it in a manner which is
contrary to their plain meaning? The answer is “No”.”
11.6. With the aforementioned reasons, findings and observations, the
High Court proceeded to allow the writ petition and held the rejection of
the technical bid of the writ petitioner as unreasonable and arbitrary, while
15
holding that “Smart Mobile Phones” fall in “similar Category Products’.
Accordingly, the High Court directed the appellant-NVS to process the
technical bid of the writ petitioner and thereafter proceed in accordance
with law.
11.7. Feeling aggrieved by the aforesaid judgment and order dated
27.09.2021, the tender inviting authority-NVS as also the bidder who is
declared successful-Agmatel have preferred these appeals.
Rival Submissions
12. Assailing the judgment and order so passed by the High Court,
learned Solicitor General of India appearing for the appellant-NVS has
referred to the facts that the tender notice in question was issued for
supply of Tablets for the students of Class XI and XII, with specific past
performance criterion that the bidder or its OEM, themselves or through
resellers, ought to have supplied same or similar category products to
the extent of 80% of bid quantity (which was changed to 60% by
corrigendum) in at least one of the last three financial years before bid
opening date to any Central/State Government Organisation/PSU/Public
Listed Company; and when the technical bids were opened, the writ
petitioner was declared disqualified for having fallen short in past
performance criterion by 10.20%. In this regard, the learned Solicitor
General has particularly referred to the details stated in the additional
affidavit filed on behalf of the appellant-NVS. We shall refer to the
relevant part of these details too, in the segment of discussion.
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12.1. The learned Solicitor General would argue that the writ petitioner
had erroneously added its past supplies towards “Smart Phones/Mobile
Handsets” and “Power Banks” so as to fulfil the past performance
criterion required for awarding the tender for “Tablets” and hence, such
supplies were not counted towards the requisite 60% of the bid quantity.
12.2. The learned Solicitor General has contended that “Smart Phones”
and “Tablets” are two different products and belong to different categories
and in this regard, has particularly referred to GeM portal of the Ministry
of Commerce and Industry, Government of India. It has been submitted
that on the said portal, “Smart Phones” and “Tablets” have been placed in
totally different categories inasmuch as “Tablets” fall under the category
“Computer Equipment and Accessories” within sub-category “Computers”
whereas “Smart Phones” fall under the category “Communication Devices
and Accessories” within sub-category “Personal Communication
Devices”. The “Smart Phones” also fall under the category “Data Voice or
Multimedia Network Equipment or Platforms and Accessories” within subcategory “Digital Mobile Equipment and Components”. With such
categorisation, the learned Solicitor General would argue, the stand of the
appellant-NVS is fortified that “Smart Phones” do not fall under same or
similar category products as “Tablets”. It has further been argued that the
terms were clear and none of the participating bidder found any ambiguity
therein and hence, provided the requisite details of the supplies pertaining
to “Tablets” only, except the writ petitioner. There was neither any
17
ambiguity nor anyone asked for any clarification including the writ
petitioner and only request was for reducing the past performance
quantity from 80% to 40% whereupon, the quantity was reduced by
corrigendum to 60%. The contention, thus, has been that everyone
including the writ petitioner well understood the requirement in the past
performance criterion as being that of supply of “Tablet” computers only.
12.3. It has further been submitted that the expressions “same” or
“similar” category products in the tender condition were obviously in
reference to different varieties and types of “Tablets”, like Slate Tablets,
Convertible Tablets, Hybrid Tablets, Phablets, Rugged Tablets, Tough
Tablets, Booklet, Microsoft Surface, Amazon Kindle Fire, Surface Pro
Tablet PC, iPad, iPad Air, iPad Pro, iPad Mini, Samsung Galaxy Tab,
ThinkPad etc.
12.4. With reference to the decision of this Court in Afcons
Infrastructure Limited v. Nagpur Metro Rail Corporation Limited &
Anr.: (2016) 16 SCC 818, the learned Solicitor General has argued that
author of the tender document is the best person to understand and
appreciate its requirements; and that the Courts must defer to such
understanding and appreciation of tender documents by the tender
inviting authority, unless there be any allegation of mala fide or perversity.
The learned Solicitor General has particularly referred to the enunciation
by this Court that even if an interpretation to the tender document by the
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author of the tender is not acceptable to the Constitutional Court, that, by
itself, would not be a reason for interfering with the interpretation given.
12.5. It has further been contended that the threshold of mala fide
intention to favour someone or arbitrariness or irrationality or perversity
must be met before the Court would interfere with the decision-making
process or the decision itself. Even in the case of ambiguity or doubt, the
Court would be refraining from giving its own interpretation unless the
interpretation given by the administrative authority is shown to be
perverse or mala fide or intended to favour someone. The learned
Solicitor General has contended that there being no finding about any
mala fide or perversity or bias, the High Court has erred in interfering in
the present tender process. It has been argued that even if the
interpretation of tender document by the appellant was not found
acceptable by the High Court, that, by itself, was not a sufficient reason
for interference. It has also been submitted that the interpretation of the
appellant-NVS is based on the pre-dominant purpose of the goods sought
to be procured and no arbitrariness or irrationality could be imputed
therein.
12.6. In its written submissions, the appellant-NVS has also adverted
to the other purchases/tenders referred by the writ petitioner in a tabular
form; and has pointed out the distinguishing features. We shall refer to
the relevant contents of this table too hereafter later.
19
13. More or less similar submissions have been made by the
learned senior counsel appearing on behalf of the appellant-Agmatel
(successful bidder) while supplementing that the High Court has erred in
going into the technical evaluation of two products and their similarity; and
this remains an impermissible area for judicial review, as held by this
Court in the case of Galaxy Transport Agencies v. New J K Roadways:
2020 SCC OnLine SC 1035. The learned senior counsel has further
argued that the view taken by the tender inviting authority and its
evaluation committee remains a reasonable view that “Smart Phones” are
not similar to “Tablets”. In this regard, the learned senior counsel has,
apart from reiterating the categories specified on the online portal GeM,
has also referred to the classification of “Tablet” computers by the Central
Board of Excise and Customs under Section 151A of the Customs Act,
1950 while specifically noting that a “Tablet” computer is different from a
“Smart Phone”, as it is an automatic data processing machine classifiable
under the heading 847130 and not 8517. Learned senior counsel has
further referred to the fact that various other authorities have considered
“Tablet” computers as computing devices similar to Laptops, PCs etc.,
while taking “Mobile Phones” under a different category. Thus, according
to the learned senior counsel, there being a reasonable view taken by
NVS and there being no mala fide or bias, there was no case for
interference by the High Court.
20
14. While countering the submissions so made on behalf of the
appellants, the learned counsel for the contesting respondent-writ
petitioner, has in the first place, submitted that its bid was rejected on
rather specious grounds inasmuch as even the reasons for rejection had
not been consistent, as noticeable from different stands taken in the initial
rejection dated 25.06.2021, in the clarification dated 29.06.2021, in the
other response dated 01.07.2021 and in the submissions made before
the High Court and this Court.
14.1. The main plank of the submissions of the learned counsel for
the writ petitioner has been that various similarly placed PSUs and
Government Agencies, in various tender documents, have used the terms
“Tablets” and “Smart Phones” rather interchangeably. In this regard, the
learned counsel has referred to the prescriptions in tender documents by
Meghalaya Information Technology Society, REC Power Distribution Co.
Ltd., Department of Education, Government of Bihar, and the Himachal
Pradesh State Electronics Development Corporation Ltd. The learned
counsel has further submitted that, wherever the tender inviting authority
wanted to restrict the past performance only to “Tablets”, the same was
stated in unambiguous terms and has referred to the tender documents
issued by Keltron and the Government of Maharashtra. The learned
counsel has further submitted that not only tender issuing authorities have
interchangeably used the products “Tablets” and “Smart Phones” but,
even the utility based application issued by various Governments do not
21
make any distinction between “Tablets” and “Smart Phones”; and has
referred to the Government portal e-pathshala which provides for e-pub,
an android based application, which is required for tablets and smart
phones alike whereas for laptops and desktops, it provides for flip-book,
which is a Windows based programme. It has also been pointed out that
MSME, Kolkata has issued common training programme for repair and
working of smart phones and tablets.
14.2. With the aforesaid details and comparisons, it has been
contended on behalf of the writ petitioner that the interpretation sought to
be suggested by the tender inviting authority in the present case is
entirely unreasonable and has rightly been interfered with by the High
Court. It has also been submitted that in the present case, the tender
inviting authority has attempted to exercise its discretion to suit a
particular bidder and to curb the competition on rather inconsistent
grounds by attempting to distinguish between otherwise identical
products. It is contended that when the tender inviting authority was
conscious of the terms stated in a particular manner, it cannot be
permitted to change such terms by way of interpretation to suit a
particular bidder or by taking away the level playing field. The submission
has been that “Smart Phones” and “Tablets” are rather synonymous terms
and the stand of the appellants deserves to be disapproved.
14.3. It has also been submitted on behalf of the writ petitioner that in
fact, it has been awarded another contract for supply of 3,00,000 tablets
22
and it had been regularly supplying various electronic products, including
tablets.
14.4. Yet further, it has been submitted that a caution was sounded
by the Central Vigilance Commission (‘CVC’) to the effect that the terms
of tender must be clear and ascertainable with specificity; and post facto
interpretations must be avoided to bring in transparency in tendering
matters. Thus, the learned counsel has supported the order impugned
and submitted that the appeals deserve to be dismissed.
15. We have given thoughtful consideration to the rival submissions
and have examined the record with reference to the law applicable.
Interpretation of Tender Document: Relevant Principles
16. The scope of judicial review in contractual matters, and
particularly in relation to the process of interpretation of tender document,
has been the subject matter of discussion in various decisions of this
Court. We need not multiply the authorities on the subject, as suffice it
would be refer to the 3-Judge Bench decision of this Court in Galaxy
Transport Agency (supra) wherein, among others, the said decision in
Afcons Infrastructure Limited (supra) has also been considered; and
this Court has disapproved the interference by the High Court in the
interpretation by the tender inviting authority of the eligibility term relating
to the category of vehicles required to be held by the bidders, in the
tender floated for supply of vehicles for the carriage of troops and
23
equipment. This Court referred to various decisions on the subject and
stated the legal principles as follows: -
“14. In a series of judgments, this Court has held that
the authority that authors the tender document is the
best person to understand and appreciate its
requirements, and thus, its interpretation should not
be second-guessed by a court in judicial review
proceedings. In Afcons Infrastructure Ltd. v. Nagpur
Metro Rail Corporation Ltd., (2016) 16 SCC 818, this
Court held:
“15. We may add that the owner or the employer of
a project, having authored the tender documents, is
the best person to understand and appreciate its
requirements and interpret its documents. The
constitutional courts must defer to this
understanding and appreciation of the tender
documents, unless there is mala fide or perversity in
the understanding or appreciation or in the
application of the terms of the tender conditions. It
is possible that the owner or employer of a
project may give an interpretation to the tender
documents that is not acceptable to the
constitutional courts but that by itself is not a
reason for interfering with the interpretation
given.”
(page 825)
(emphasis supplied)
15. In the judgment in Bharat Coking Coal Ltd. v. AMR
Dev Prabha 2020 SCC OnLine SC 335, under the
heading “Deference to authority's interpretation”, this
Court stated:
“51. Lastly, we deem it necessary to deal with another
fundamental problem. It is obvious that Respondent
No. 1 seeks to only enforce terms of the NIT. Inherent
in such exercise is interpretation of contractual terms.
However, it must be noted that judicial interpretation of
contracts in the sphere of commerce stands on a
distinct footing than while interpreting statutes.
52. In the present facts, it is clear that BCCL and India
have laid recourse to Clauses of the NIT, whether it be
to justify condonation of delay of Respondent No. 6 in
submitting performance bank guarantees or their
decision to resume auction on grounds of technical
failure. BCCL having authored these documents, is
better placed to appreciate their requirements and
interpret them. (Afcons Infrastructure Ltd. v. Nagpur
Metro Rail Corporation Ltd., (2016) 16 SCC 818)
24
53. The High Court ought to have deferred to this
understanding, unless it was patently perverse or mala
fide. Given how BCCL's interpretation of these clauses
was plausible and not absurd, solely differences in
opinion of contractual interpretation ought not to have
been grounds for the High Court to come to a finding
that the appellant committed illegality.”
(emphasis supplied)
16. Further, in the recent judgment in Silppi
Constructions Contractors v. Union of India, 2019 SCC
OnLine SC 1133, this Court held as follows:
“20. The essence of the law laid down in the
judgments referred to above is the exercise of restraint
and caution; the need for overwhelming public interest
to justify judicial intervention in matters of contract
involving the state instrumentalities; the courts should
give way to the opinion of the experts unless the
decision is totally arbitrary or unreasonable; the court
does not sit like a court of appeal over the appropriate
authority; the court must realise that the authority
floating the tender is the best judge of its requirements
and, therefore, the court's interference should be
minimal. The authority which floats the contract or
tender, and has authored the tender documents is the
best judge as to how the documents have to be
interpreted. If two interpretations are possible then the
interpretation of the author must be accepted. The
courts will only interfere to prevent arbitrariness,
irrationality, bias, mala fides or perversity. With this
approach in mind we shall deal with the present case.”
(emphasis supplied)
17. In accordance with these judgments and noting that
the interpretation of the tendering authority in this case
cannot be said to be a perverse one, the Division Bench
ought not to have interfered with it by giving its own
interpretation and not giving proper credence to the word
“both” appearing in Condition No. 31 of the N.I.T. For this
reason, the Division Bench's conclusion that JK
Roadways was wrongly declared to be ineligible, is set
aside.
18. Insofar as Condition No. 27 of the N.I.T. prescribing
work experience of at least 5 years of not less than the
value of Rs. 2 crores is concerned, suffice it to say that
the expert body, being the Tender Opening Committee,
consisting of four members, clearly found that this
eligibility condition had been satisfied by the Appellant
before us. Without therefore going into the
assessment of the documents that have been
supplied to this Court, it is well settled that unless
arbitrariness or mala fide on the part of the tendering
25
authority is alleged, the expert evaluation of a
particular tender, particularly when it comes to
technical evaluation, is not to be second-guessed by
a writ court. Thus, in Jagdish Mandal v. State of
Orissa, (2007) 14 SCC 517, this Court noted:
“22. Judicial review of administrative action is intended
to prevent arbitrariness, irrationality,
unreasonableness, bias and mala fides. Its purpose is
to check whether choice or decision is made “lawfully”
and not to check whether choice or decision is
“sound”. When the power of judicial review is invoked
in matters relating to tenders or award of contracts,
certain special features should be borne in mind. A
contract is a commercial transaction. Evaluating
tenders and awarding contracts are essentially
commercial functions. Principles of equity and natural
justice stay at a distance. If the decision relating to
award of contract is bona fide and is in public interest,
courts will not, in exercise of power of judicial review,
interfere even if a procedural aberration or error in
assessment or prejudice to a tenderer, is made out.
The power of judicial review will not be permitted to be
invoked to protect private interest at the cost of public
interest, or to decide contractual disputes. The
tenderer or contractor with a grievance can always
seek damages in a civil court. Attempts by
unsuccessful tenderers with imaginary grievances,
wounded pride and business rivalry, to make
mountains out of molehills of some
technical/procedural violation or some prejudice to
self, and persuade courts to interfere by exercising
power of judicial review, should be resisted. Such
interferences, either interim or final, may hold up
public works for years, or delay relief and succour to
thousands and millions and may increase the project
cost manifold. Therefore, a court before interfering in
tender or contractual matters in exercise of power of
judicial review, should pose to itself the following
questions:
(i) Whether the process adopted or decision made by
the authority is mala fide or intended to favour
someone;
or
Whether the process adopted or decision made is so
arbitrary and irrational that the court can say:“the
decision is such that no responsible authority acting
reasonably and in accordance with relevant law could
have reached”;
(ii) Whether public interest is affected.
26
If the answers are in the negative, there should be no
interference under Article 226. Cases involving
blacklisting or imposition of penal consequences on a
tenderer/contractor or distribution of State largesse
(allotment of sites/shops, grant of licences,
dealerships and franchises) stand on a different
footing as they may require a higher degree of
fairness in action.”
(pages 531-532)
(emphasis supplied)
19. Similarly, in Montecarlo Ltd. v. NTPC Ltd., (2016) 15
SCC 272, this Court stated as follows:
“26. We respectfully concur with the aforesaid
statement of law. We have reasons to do so. In the
present scenario, tenders are floated and offers are
invited for highly complex technical subjects. It
requires understanding and appreciation of the nature
of work and the purpose it is going to serve. It is
common knowledge in the competitive commercial
field that technical bids pursuant to the notice inviting
tenders are scrutinised by the technical experts and
sometimes third-party assistance from those
unconnected with the owner's organisation is taken.
This ensures objectivity. Bidder's expertise and
technical capability and capacity must be assessed by
the experts. In the matters of financial assessment,
consultants are appointed. It is because to check and
ascertain that technical ability and the financial
feasibility have sanguinity and are workable and
realistic. There is a multi-prong complex approach;
highly technical in nature. The tenders where public
largesse is put to auction stand on a different
compartment. Tender with which we are concerned, is
not comparable to any scheme for allotment. This
arena which we have referred requires technical
expertise. Parameters applied are different. Its aim is
to achieve high degree of perfection in execution and
adherence to the time schedule. But, that does not
mean, these tenders will escape scrutiny of judicial
review. Exercise of power of judicial review would be
called for if the approach is arbitrary or mala fide or
procedure adopted is meant to favour one. The
decision-making process should clearly show that the
said maladies are kept at bay. But where a decision
is taken that is manifestly in consonance with the
language of the tender document or subserves the
purpose for which the tender is floated, the court
should follow the principle of restraint. Technical
evaluation or comparison by the court would be
impermissible. The principle that is applied to scan
27
and understand an ordinary instrument relatable to
contract in other spheres has to be treated differently
than interpreting and appreciating tender documents
relating to technical works and projects requiring
special skills. The owner should be allowed to carry
out the purpose and there has to be allowance of free
play in the joints.”
(page 288)
20. This being the case, we are unable to fathom how the
Division Bench, on its own appraisal, arrived at the
conclusion that the Appellant held work experience of
only 1 year, substituting the appraisal of the expert fourmember Tender Opening Committee with its own.”
(Underlining emphasis in the original; emphasis in bold supplied)
17. 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.
Application of relevant principles to the case at hand
18. Applying the aforesaid principles to the case at hand, we are
clearly of the view that the impugned order cannot be sustained.
19. In relation to the contention that the tender inviting authority was
the best judge to interpret the conditions of tender and the Court should
28
not interfere, the High Court referred to an observation by this Court in the
case of Reliance Energy Ltd. (supra) that when tenders are invited,
terms and conditions must indicate norms and benchmarks with legal
certainty. In that case, the said observations came in the backdrop of the
facts that in the eligibility conditions of the tender before the Court, one of
the criteria had been of the consortium net cash profit of Rs. 200 crores
but, the State had not specified the accounting norms with clarity for
calculation of net cash profit; and one of the two acceptable methods of
calculation of net cash profit was not taken into account without any
reason. In the given facts, the decision of the authority concerned was
found to be arbitrary, whimsical and unreasonable. The said decision in
Reliance Energy Ltd. (supra) has no direct application to the facts of the
present case and even otherwise, it has not been the finding of the High
Court that the term stated by the tender inviting authority-NVS was
lacking in certainty. However, beyond this, as to which particular product
was to be treated as similar category product, could not have been a
matter of interpretative exercise by the Court, particularly when the view
taken by the tender inviting authority and its evaluation committee has not
been shown to be absurd or irrational or suffering from mala fide.
20. It has also rightly been pointed out by the appellants, with
reference to the decision in Afcons Infrastructure Limited (as extracted
in the quotation hereinabove), that an interpretation by owner or employer
of a project to the tender document may not be acceptable to the
29
Constitutional Courts but that, by itself, would not be a reason for
interfering with the interpretation given. In the aforesaid view of matter,
the long-drawn exercise by the High Court on the dictionary meaning of
the words and on semantics, in our view, had been entirely unnecessary.
21. The High Court has even proceeded to find the elements of
similarity between “Smart Phones” and “Tablets” (vide paragraph 30 of
the impugned order). The writ petitioner has also made elaborate
submissions to suggest that “Smart Phones” and “Tablets” are of similar
category. The respondents, per contra, have also made detailed
submissions that these two products are neither the same nor of similar
category. In our view, an elaborate and in-depth analysis of the features
and categorisation of these two products is not called for but, for the
reason that the High Court has adopted such a course, a few comments
on this aspect would also be apposite.
21.1. Even if some organisations/institutions, with reference to their
requirements or other relevant factors, had assumed these two products,
i.e., “Tablets” and “Smart Phones” akin to each other, the facts do remain
that these very products have been placed under different categories on
the online portal GeM and have also been taken as classifiable differently
by the customs authority. In the given set of facts and classifications, the
decision, as taken by NVS and its TEC, cannot be said to be suffering
from irrationality, absurdity or mala fide. In our view, the analysis of the
writ Court needs to stop at that. Beyond this point, the writ Court would
30
not be substituting its preferred interpretation of the tender condition with
the one adopted by the author of the tender document and the person
procuring the product, who has to be regarded as the best person to
understand its requirements.
21.2. Putting it differently, neither the excessive analysis, as entered
into by the High Court, was required in this case nor we would be
evaluating all the specifications of these two products, namely, “Smart
Phones” and “Tablets”. Suffice it to notice for the present purpose that
even if both are electronic devices and even if several of their utility
features are the same or similar, their categorisation under different
headings is also a fact not unknown to the parties, as would appear from
the categorisation on the Government online portal itself. Beyond this
aspect, in our view, no adjudicatory process is called for and the
interpretation as put by the tender inviting authority-NVS does not
deserve interference. Similarly, if in some of the notice inviting tenders,
both smart phones and tablets were stated, or in some of the tenders,
specific product tablet alone was stated, that would also not be decisive
because that would, obviously, depend on the purpose for which the
procurement was being made; and the procuring party, i.e., the tender
inviting authority, ought to be extended the latitude to decide on its
requirements.
31
22. In the same context, we may also deal with another feature of this
case related with the supplies made by the writ petitioner to different
organisations pursuant to different tender notices.
22.1. As noticed, the writ petitioner, in order to assert its fulfilment of the
above referred Past Performance criterion, has relied upon the
statements made by its OEM in the letter dated 16.04.2021. That reads
as under: -
“PO details in FY 2019-20 (Single Year): Past Performance Clause
Sr.N
o.
Organis
ation
Name
PO &
Completi
on
Certificat
e
Quantity (Units)
1 Punjab
Infotech
PICTC/IT
eG/2019/
2872
dated
25.11.20
19
1,75,443
2 Director
ate of
Welfare
of
Schedul
ed
CastesAssam
DSC./Spl.Grant/T
B/539/2019/45
dated 06-02-2020
3809
3 Directorate of
Welfare of Plain
Tribes &
Backward
Classes–
Assam
DW/OTG./OBC/2
019-20/755/PtIX/16 dated 13-
01-2020
19047
4 Directorate of
Welfare of Plain
Tribes &
Backward
Classes–
Assam
DW/OTG./ST/201
9-20/754/Pt-VI/13
dated 13-01-2020
14285
5 Directorate of
Women and
Child
Development
Kerala
Contract No.
GEMC51168773809149
3; Date:13-Aug2019
27550
32
6 Directorate of
Women and
Child
Development
Kerala
Contract No.
GEMC51168771294670
5; Date: 23-Apr2019
8885
Total Quantity 249019
We have even received the Biggest Purchase order of round 175443
Units of Smart phones by Punjab Infotech for Education Purpose and
supplied the device successfully. PO and Completion Certificate is
enclosed.”
22.2. In regard to the supplies shown by the writ petitioner, details
have been stated by the appellant-NVS in the additional affidavit in the
following terms: -
“3…..Quantity supplied by Ms. Lava International Ltd. (OEM of
respondent no. 1) during last 3 financial years before the bid opening
date are as under:
Sl.
No.
Financ
ial
Year
Device
Type
Quantity
Supplied
Page
Nos.
1 2020-
21
Tablets - -
Smartphones - -
Power banks - -
2 2019-
20
Tablets 3809 131
19047 132
14285 133
Total 37141
Smartphones 175443 127
27550 136
8885 143
Total 211878
Power banks 27550 136
8885 143
Total 36435
3 2018-
19
Tablets 3809 135
3809 135
Total 7618
Smartphones 1598 120
4418 121
Total 6016
Power banks - -
33
4. I submit that the Committee for Technical Evaluation had
opened the bids on 12.05.2021 and, after scrutinizing the documents
submitted by Respondent No. 1 with regard to past performance
mentioned at clause 4 of bid document found that Power banks and
Smart Phones could not be considered as “same or similar category
products” and, only work orders for Tablets could be considered as per
the clause 4 of the bid document. Further it was found that the data and
documents provided by the Respondent No. 1 for the three Financial
Years viz., FY 2018-19, 2019-20 and 2020-21, maximum quantities of
Tablets supplied by the Respondent No. 1 were in the FY 2019-20 i.e.
37141 nos. which was short by 10.20% of the 60% criterion [60% of
68490 = 41364] for satisfying the past performance clause 4 of the bid
document.
5. I submit that due to shortfall of 10.2% of the required quantity
of same or similar category products as per past performance clause,
the Respondent No. 1 was declared disqualified in technical bid.”
22.3. The writ petitioner has also referred to the several such contracts
where both the products, tablets and smart phones, have been procured
simultaneously while suggesting that these terms have even been used
interchangeably. On the other hand, the appellant-NVS has stated in
detail that the supplies of Tablets by the writ petitioner fell short by
10.20% to 60% criterion and the writ petitioner was, in fact, largely
supplying smart phones and not tablets. As regards the organisations and
their tender processes referred by the writ petitioner, various comments
have been offered by the appellant-NVS in a tabular form; the relevant
parts thereof read as under: -
“Purchases/ Tenders referred by Resoursys Telecom through its
WP no. 6676/2021 and additional affidavit filed therein
Purchaser Purpose &
Objectives
Claim
through the
WP
Reply of NVS
HP State
Electronics
Development
Corporation
Ltd. (for
Rate Contract
for
procurement
of android
based
HP State
Electronics
Development
Corp had
placed
**Since, the
referred tender
was itself for
smartphones,
hence no
34
Himachal
Pradesh
Govt.)
smartphones smartphones
& Tablets at
par in the etender
documents
compatibility
and relevance
with the subject
matter which is
the bid process
of Tablet
Computers.
Guwahati
High Court at
Guwahati
Bid was
invited for
supply &
maintenance
of 395
numbers of
smartphones
for Bailiff/
Process
servers in
various court
complexes of
Assam.
Not
mentioned in
the Writ as
well as
additional
affidavit.
However,
documents
were attached
with the WP.
** Since, the
referred tender
was itself for
smartphones,
hence no
compatibility
and relevance
with the subject
matter which is
the bid process
of Tablet
Computers.
High Court of
Himachal
Pradesh,
Shimla
To supply and
install approx.
455 number
of
smartphones
to the process
servers and
bailiffs in the
subordinate
courts.
Smart phones
& Tablets are
considered at
par for the
purpose of
meeting the
eligibility
criteria.
Smart Phones
are
interchangeab
le.
Both have
same
specifications.
**Bid was
cancelled.
Meghalaya
Information
Technology
Society
(MITY)
Tender for
procurement
of Tablet PCs
Meghalaya
Information
Technology
Society
invited a
tender for
Tablets
wherein
Tablets/
Smart/
Phones/
Laptops are
considered
under same
and similar
category.
** Tender
clause for
eligibility
criteria is totally
distinct from
the NVS bid.
**In the
eligibility
conditions,
bidder has
specifically
mentioned that
they will
consider Tablet
PC or Smart
35
Phones or
Laptops or IT
products.
Kerala State
Electronics
Development
Corporation
Ltd.
Rate Contract
for Tablet
PC’s for ehealth
Not
mentioned in
the Writ as
well as
additional
affidavit.
However,
documents
were attached
with the WP.
In the bid
document of
KELTRON, it is
specifically
mentioned that
Tablet, PCs,
Laptop, Net
books,
Desktops will
be accepted.
Nowhere
Kerala State
Electronics
Development
Corporation
Ltd. accepted
the
smartphones in
the similar
category of
ICT(Tablet, PC
Laptop,
Netbook and
Desktop).
**Tender clause
is different
however
smartphones is
not considered.
REC Power
Distribution
Co. Ltd.
Rate contract
for supply of
1000 number
of Tablet.
Bidder should
have desire
experience of
supplying
Tablet/ Smart
phones.
**In the bid
document, past
performance
criteria is totally
distinct from
the NVS bid
document.
Tender clause
is different.
**The bid
process floated
by RECPDCL
was not floated
through the
GeM Portal,
hence, the
RECPDCL and
NVS are not on
similar footing.
**The matter of
36
NVS is distinct
as no query
was raised by
the anyone of
prospective
bidders
regarding
inclusion of
smart phones
in past
experience.
**The bid
process was
floated 6 years
back.
Department of
Education,
Govt. of Bihar
Expression of
interest (EOI)
for selection
of agencies
for supply and
service of Elearning
tablets.
In the tender
documents
under clause
3.7.3, the
criteria is
mentioned
that the
bidder should
be either
OEM or
authorized
supplier of
Mobiles/
Tablets.
**It is
Expression of
Interest not a
Tender.
**Referred
bidder has
prepared the
documents of
bid as per their
need, expertise
and familiarity.
However, NVS
has floated the
bid of procuring
Tablet on GeM
portal, Govt of
India adhering
to the all norms
& provisions of
bidding
process.
**Prequalification
criteria are
distinct from
the NVS
criterias.
**Past
performance
criteria
mentioned in
clause 4 by
NVS and
criteria referred
by the bidder
under clause
37
3.7.3 are
distinct.
Govt. of Bihar,
Rural
Development
Department
Tender for
procurement
of Tablet and
related
accessories
for BRDS
under BIPS
project
Rural
Development
Department,
Govt. of Bihar
considered
experience of
products like
tablet and
smartphones
under similar
products.
**The matter of
NVS is distinct
as no query
was raised by
the anyone of
prospective
bidders
regarding
inclusion of
smart phones
in past
experience.
**In the bid
document
(Addendum-II),
experience
[clause 3(b)] is
distinct to the
NVS past
experience
clause 4. In the
referred bid
document
tenderer
(buyer/author
of the tender)
has specifically
shown the
intends to
consider the IT
product like
Tablet and
Smartphones
whereas NVS
has nowhere
mentioned.
**In all aforesaid purchases referred by the respondents Resoursys
Telecom, incomplete documents are attached with the Writ and
additional affidavit.
**NVS in its bid documents specifically mentioned that Tender is floated
for Tablet Computers only.
**NVS has floated the bid through the GeM portal.
**No prospective bidders raised any query regarding inclusion of
smartphones under similar category. Only OEM of the R-1 i.e. Ms. Lava
OEM has requested to reduce the past performance from 80% to 40%
and technical committee has considered the request of the Ms. Lava
positively and reduced the requirement of past performance from 80% to
60%.
**There is not a single case where bid condition is same and
smartphones added in the similar category products.
38
**Referred purchases consists different clause and purposes, hence, the
same are not squarly covered in the instant case i.e. tender floated by
the NVS for Tablet Computer only wherein specifically mentioned under
clause 4 of past performance that the experience under same or similar
category will be considered.
**In the aforesaid purchase referred by the respondent, no matter on
GeM wherein smartphones is considered under same or similar category
of Tablet Computer unless specifically and unequivocally mentioned to
this effect. It axiomatically demonstrates that the Smartphones are not
comes under the purview of same or similar category of Tablet
Computers.”
22.4. The aforesaid submissions on facts make this much clear that the
decision, as taken by the appellant-NVS and its TEC, cannot be said to
be totally baseless or absurd or irrational or illogical. It gets perforce
reiterated that even if some of the organisations, in relation to their
requirements, procured tablets and smart phones both under the same
tender process or even used these expressions “interchangeably” or
“interconnected”, that by itself cannot lead to a definite conclusion by the
Court that “Smart Phones” and “Tablets” are to be taken as similar
category products for the tender process in question.
23. Viewed from any angle, interference by the High Court in this
matter does not appear justified, particularly when no case of mala fide or
bias is alleged. Every decision of the administrative authority which may
not appear plausible to the Court cannot, for that reason alone, be called
arbitrary or whimsical. The High Court, in the present matter has
obviously proceeded with an assumption that the view as being taken by
it, in acceptance of the case of the writ petitioner, was required to be
substituted in place of the views of the tender inviting authority. That has
been an error of law and cannot sustain itself in view of the consistent
39
binding decisions of this Court, including the 3-Judge Bench decision in
Galaxy Transport (supra).
24. The High Court, while supporting its process of reasoning, has
referred to such principles which, with respect, we find entirely inapposite
and beyond the periphery of the question involved in the present case. As
noticed, in such matter of contracts, the process of interpretation of terms
and conditions is essentially left to the author of the tender document and
the occasion for interference by the Court would arise only if the
questioned decision fails on the salutary tests laid down and settled by
this Court in consistent decisions, namely, irrationality or
unreasonableness or bias or procedural impropriety.
24.1. In the case of Nabha Power Limited (supra), as referred by the
High Court, this Court, while referring to the concept of ‘Penta test’ for
‘business efficacy’, made it clear that such a test and thereby reading an
“implied term”, would come in play only when the five conditions are
satisfied. Even in that case, the Court, while dealing with the question of
reimbursement of cost incurred by the successful bidder/power supplier
towards washing of coal in a power procurement project, analysed as to
what charges would be payable by interpretation of all the terms of the
contract and held the appellant entitled to certain charges as the formula
for energy charges was clear. In the present case too, neither the High
Court was reading any “implied term” in the past performance criterion
nor NVS had done so. It is difficult to find any correlation of the decision
40
in Nabha Power Limited (supra) to the case at hand or even to the
analysis by the High Court.
24.2. The same aspects apply to the observations regarding ‘contra
proferentem rule’ as referred by the High Court with reference to the case
of United India Insurance Company Limited (supra). The said rule was
referred by this Court while not accepting the argument made on behalf of
the insured and while observing that the said rule had no application,
when the language of the relevant clauses was plain, clear and
unambiguous. We may, however, observe that even from the extracted
part of the principles related with the ‘contra proferentem rule’, as
reproduced by this Court from the Halsbury's Laws of England, it is clear
that the said rule was applied in the case of ambiguity in the insurance
policy because the policies are made by the insurer and its ambiguity
cannot be allowed to operate against the insured. This rule, in our view,
cannot be applied to lay down that in case of any ambiguity in a tender
document, it has to be construed in favour of a particular person who
projects a particular view point. The obvious inapplicability of this doctrine
to the eligibility conditions in a notice inviting tender could be visualised
from a simple fact that in case of ambiguity, if two different tenderers
suggest two different interpretations, the question would always remain
as to which of the two interpretation is to be accepted? Obviously, to
avoid such unworkable scenarios, the principle is that the author of the
tender document is the best person to interpret its documents and
41
requirements. The only requirement of law, for such process of decisionmaking by the tender inviting authority, is that it should not be suffering
from illegality, irrationality, mala fide, perversity, or procedural impropriety.
No such case being made out, the decision of the tender inviting authority
(NVS) in the present case was not required to be interfered with on the
reasoning that according to the writ Court, the product “Smart Phone”
ought to be taken as being of similar category as the product “Tablet”.
25. It has also been argued on behalf of the writ petitioner that the
reasons for rejection by NVS have not been consistent. We are unable to
find any inconsistency in the reasons assigned by the appellant-NVS in
rejection of the bid of the writ petitioner. In the initial information, only this
much was stated that there was a mismatch of technical specification but,
when required further by the writ petitioner, the appellant-NVS elaborated,
in its reply dated 29.06.2021, on the fact that the work orders concerning
smart phones, laptops, Aadhaar kits, printers, power-banks were not
considered to be as same or similar category products to that of tablets.
Yet further, the representations made by the writ petitioner and its OEM
were responded with the assertion that the TEC had considered only
“Tablets” under similar category to ensure proven products. Same has
been the stand of NVS before the High Court and before us. Mere
elaboration by the tender inviting authority as regards its reasons and
basis of the decision cannot be said to be that of any inconsistency.
42
26. We may also observe that the other submission made on behalf of
the writ petitioner about the caution sounded by CVC that the terms of
tender must be clear and post facto interpretations must be avoided to
bring in transparency in the tendering matters, carry no implication in the
facts of the present case. The terms of tender in the present case had
been clear, and they were ascertainable with specificity available on the
very portal on which NIT was issued. It had not been a case of post facto
interpretations by the tender inviting authority-NVS. Certain suggestions
made on behalf of the writ petitioner about the tender inviting authority
changing the terms to suit a particular bidder remain baseless. No such
case of mala fide has been made out; rather, as pointed out on behalf of
the appellant, all the other tenderers clearly understood the meaning and
requirement of the past performance criterion and stated the particulars of
tablets supplied by them in the past. Such contentions of the writ
petitioner have only been noted to be rejected.
27. Similarly, the submission made on behalf of the writ petitioner, that
it had been awarded another contract for supply of 3,00,000 tablets,
carries no meaning at all. Such a supply contract had not been a matter
of evaluation in the tender process in question, where the quantity in the
last three financial years before the bid opening date was to be
considered. Any subsequent event could neither invest the writ petitioner
with any right in the present matter nor the impugned order could be
sustained on that basis.
43
Conclusion
28. For what has discussed hereinabove, we are clearly of the view
that the petition filed by the writ petitioner was required to be dismissed.
The High Court having allowed the writ petition on rather irrelevant
considerations, the impugned order is required to be set aside
29. Consequently, these appeals succeed and are allowed; the
impugned judgment and order dated 27.09.2021 is set aside; Writ Petition
(C) No. 6676 of 2021, as filed by the writ petitioner, is dismissed with no
order as to costs.
………….…….…………. J.
(DINESH MAHESHWARI)
 .…………………………J.
(VIKRAM NATH)
New Delhi;
Dated: January 31, 2022
44

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले

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