Facts of the Case

The petitioner, M/s Niharika Enterprises, was a sole proprietorship firm engaged in the business of supplying stationery and allied items.

The petitioner claimed that it had previously been entrusted with supply work by the authorities of Fakhruddin Ali Ahmed Medical College & Hospital, Barpeta.

On 21 September 2021, the authorities issued a Notice Inviting Tender (NIT) for supply of stationery and allied items for the financial years 2021–23.

The petitioner claimed to be eligible in all respects and, having undertaken similar supply work on earlier occasions, submitted its bid. The last date for submission was fixed as 30 September 2021, and the bids were scheduled to be opened at 12:30 PM on the same date.

According to the petitioner, there was a delay in opening the bids, due to which its representative could not remain physically present at the relevant time.

As the outcome of the tender exercise was not known to the petitioner, communications were exchanged. Ultimately, by an e-mail dated 22 October 2021, the petitioner was informed that its technical bid had been rejected. The impugned rejection letter dated 21 October 2021 was attached to the e-mail.

The petitioner further relied upon an earlier NIT dated 10 June 2021 issued by the same authority for supply of liveries, bedding and clothing items at Fakhruddin Ali Ahmed Medical College & Hospital, Barpeta, for the financial year 2021–23.

According to the petitioner:

  • the eligibility conditions in the earlier tender were similar;
  • a similar set of documents had been required;
  • the petitioner had participated using the same set of documents;
  • the petitioner had been technically qualified; and
  • the work had been awarded to the petitioner by order dated 12 August 2021.

The petitioner also stated that it had executed as many as seven supply works in the same hospital during the current financial year.

Grounds on Which the Petitioner’s Bid Was Rejected

The rejection was challenged with reference to three broad grounds:

  1. Absence of the petitioner’s representative at the time of opening of bids;
  2. Non-submission of the Firm Registration Certificate; and
  3. Alleged failure to sign all pages of the tender documents.

The petitioner challenged these grounds as superficial, trivial and legally insufficient to justify rejection of its technical bid.

Issues Involved

The principal issues before the Gauhati High Court were:

  1. Whether the petitioner’s technical bid could lawfully be rejected for non-submission of a Firm Registration Certificate when the petitioner was a sole proprietorship firm holding a municipal trade licence and GST registration.
  2. Whether rejection on the ground of absence of the petitioner’s representative during opening of the bids was sustainable.
  3. Whether failure to sign or self-attest copies of certain personal certificates, when the tender document pages were otherwise duly signed, constituted a substantial defect justifying rejection.
  4. Whether missing self-attestation on certain certificates was merely a trivial and curable defect.
  5. Whether the authorities could insist upon a Firm Registration Certificate despite being fully aware of the petitioner’s antecedents and having previously awarded similar supply contracts on substantially the same documentation.
  6. Whether public interest was relevant when the prices quoted by the petitioner for indicated items were lower.
  7. Whether the tender disqualification was arbitrary, unjustified and unsustainable in law.
  8. Whether the principles concerning curable and incurable tender defects, as discussed in G.J. Fernandez vs State of Karnataka & Ors., (1990) 2 SCC 488, and Poddar Steel Corporation vs Ganesh Engineering Works & Ors., (1991) 2 SCC 273, supported judicial interference.

Petitioner’s Arguments

Learned Senior Counsel for the petitioner submitted that the rejection of the technical bid was based on superficial and trivial grounds.

1. Absence of Representative During Bid Opening

The petitioner argued that absence of its representative at the time of opening of the tender could not constitute a valid ground for rejection.

It was submitted that any prejudice resulting from such absence would be suffered by the petitioner itself and not by the tendering authorities.

Therefore, physical absence of the petitioner’s representative could not justify disqualification of the bid.

2. Non-Submission of Firm Registration Certificate

The petitioner submitted that it was a sole proprietorship firm.

In support of its legal and business existence, reliance was placed upon:

  • the licence issued by the Gauhati Municipal Corporation on 16 July 2015; and
  • the petitioner’s GST registration dated 25 June 2017.

The petitioner contended that rejection merely for non-submission of a Firm Registration Certificate was unjustified, particularly when its identity, status and antecedents were already known to the authorities.

3. Alleged Absence of Signatures on Tender Papers

The petitioner submitted that careful scrutiny showed that the alleged deficiency did not concern all tender papers.

According to the petitioner, only copies of documents such as the PAN Card and other certificates did not contain the petitioner’s signature.

The petitioner emphatically contended that the pages of the tender documents were otherwise duly signed.

Therefore, any missing signature or self-attestation on copies of personal certificates was at best a minor, trivial and curable defect.

4. Prior Acceptance of Similar Documents

The petitioner highlighted that in an earlier tender issued by the same authority on 10 June 2021, similar eligibility conditions and similar documentary requirements existed.

The petitioner had submitted the same set of documents, was found technically qualified and was awarded the work by order dated 12 August 2021.

The petitioner further asserted that it had already executed as many as seven supply works at the same medical college and hospital during the current financial year.

Accordingly, the authorities were fully aware of the petitioner’s credentials and antecedents.

5. Reliance on Supreme Court Case Law

The petitioner relied upon:

  • G.J. Fernandez vs State of Karnataka & Ors., (1990) 2 SCC 488; and
  • Poddar Steel Corporation vs Ganesh Engineering Works & Ors., (1991) 2 SCC 273.

The petitioner invoked these authorities in support of the legal distinction between curable and incurable defects in tender processes.

Respondent’s Arguments

Learned Standing Counsel for the Health and Family Welfare Department opposed the writ petition and relied upon the affidavit-in-opposition dated 06 January 2022.

The respondents argued that:

  • the grounds of rejection were relevant;
  • there was no mala fide in the tender evaluation exercise;
  • the allegation that tenders were not opened on the scheduled date and time was incorrect;
  • the minutes demonstrated that absence of the petitioner’s representative was not the actual ground for cancellation of the petitioner’s bid; and
  • the principal grounds for rejection were:
    • non-submission of the Firm Registration Certificate; and
    • failure to sign each and every paper of the tender document.

However, it was not disputed that:

  • the petitioner had been issued a licence by the Gauhati Municipal Corporation;
  • the petitioner possessed GST registration; and
  • the same authorities had previously offered a number of similar works for supply of stationery and allied items to the petitioner with the same antecedents.

Court’s Analysis and Findings

1. Insistence on Firm Registration Certificate Was Not Proper

The Court found that rejection of the petitioner by insisting upon registration of the firm was not proper.

The Court observed that such insistence would be inconsequential because the petitioner’s antecedents were fully known to the authorities.

The Court took note of the fact that:

  • similar works had earlier been granted to the petitioner;
  • the same authorities had accepted the petitioner’s documents previously;
  • the petitioner had specifically pleaded that it had executed seven supply works in the same hospital during the current financial year; and
  • there was no specific denial of the material assertion regarding the petitioner’s earlier participation and acceptance.

The Court further noted that it was admitted that, in respect of the earlier NIT, the petitioner had submitted an up-to-date trade licence instead of a Firm Registration Certificate along with other documents.

Accordingly, rejection on this ground was found improper.

2. Missing Self-Attestation Was a Trivial and Curable Defect

While examining the issue regarding signatures on all pages of the tender documents, the Court found that signatures were absent only on the personal certificates of the petitioner firm.

It was not disputed that the pages of the tender document were otherwise duly signed.

The Court therefore treated the situation as one where self-attestation of the petitioner’s certificates was missing.

The Court expressly held that such a defect could, at best, be termed:

  • trivial in nature; and
  • curable in nature.

Accordingly, rejection of the petitioner’s bid on that ground was held to be unjustified.

3. Public Interest Was Also Relevant

The Court also considered the prices offered by the petitioner, which had been brought on record through a chart in the affidavit-in-reply dated 31 January 2022.

On a bare perusal, the Court observed that the prices quoted by the petitioner were lower in the indicated items.

Therefore, the Court held that the question of public interest also arose for consideration.

4. Tender Rejection Held Unsustainable in Law

Having regard to:

  • the law laid down in the cited authorities;
  • the nature of the defects;
  • the petitioner’s known antecedents;
  • prior acceptance of similar documents;
  • the curable nature of missing self-attestation; and
  • the public interest involved,

the Gauhati High Court concluded that rejection of the petitioner was unjustified and unsustainable in law.

Court Order / Final Directions

The Gauhati High Court held that the rejection of the petitioner, communicated through the impugned rejection letter, was:

  • unjustified; and
  • unsustainable in law.

Accordingly, the Court:

  1. set aside the rejection of the petitioner;
  2. directed the respondent authorities to accept the petitioner’s tender;
  3. directed that the petitioner be regarded as one of the eligible and successful bidders forming part of the pool under the NIT in question;
  4. disposed of the writ petition; and
  5. vacated the interim order passed earlier.

Important Clarification

The judgment does not establish that every technical defect in a tender is automatically curable or that all tender conditions can be ignored.

The decision is fact-specific.

The Court’s intervention was based on important circumstances, including:

  • the petitioner was a sole proprietorship firm;
  • the petitioner held a municipal licence and GST registration;
  • the authorities already knew the petitioner’s credentials and antecedents;
  • the petitioner had previously executed similar works;
  • the same authorities had earlier accepted substantially similar documentation;
  • the tender document pages were otherwise duly signed;
  • the missing signatures related only to personal certificates and effectively amounted to missing self-attestation;
  • the defect was found to be trivial and curable;
  • the petitioner’s quoted prices for indicated items were lower; and
  • public interest was involved.

Therefore, the ratio of the judgment should be understood in the context of the particular tender conditions, the nature of the deficiency, prior dealings between the parties and the public interest considerations identified by the Court.

Sections / Legal Provisions Involved

The uploaded judgment concerns judicial review of a tender disqualification and the legal distinction between curable and incurable defects in tender conditions.

Important accuracy clarification: The judgment does not expressly identify or decide the matter under any specific statutory section. Therefore, no statutory section has been artificially attributed to the case.

The principal legal framework involved is:

  • exercise of writ jurisdiction in judicial review of administrative tender decisions;
  • legality of rejection of a technical bid;
  • distinction between essential and non-essential tender requirements;
  • distinction between curable and incurable defects;
  • proportionality and reasonableness in tender evaluation;
  • public interest in procurement decisions; and
  • legality of disqualification for technical, trivial or curable deficiencies.

Link to download the order -

https://mytaxexpert.co.in/uploads/1783069159_395compressed.pdf 

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