Facts of the Case

Paharpur Cooling Towers Limited challenged the Techno-Commercial Evaluation Summary dated 06.08.2024 and the Bid Evaluation Summary dated 08.08.2024 issued in respect of Tender No. 203168C/T/CT/PACKAGE-1, floated by a public sector respondent, under which Respondent No.4 was declared technically qualified and the L1 (lowest) bidder.

The petitioner's grievance was that Respondent No.4 did not independently possess the technical experience/track record required by the tender conditions and had relied on the credentials of a group company (Hamon Group) notwithstanding changes in shareholding, which the petitioner argued was impermissible reliance under the tender terms and under precedent such as New Horizons Ltd. v. Union of India.

Respondent No.4 and the tendering authority defended the evaluation, contending the tender conditions did not bar such reliance, that there was no requirement of continuity of ownership or exclusive access to proprietary technology, and that the evaluation process had been conducted properly. After hearing extensive submissions from senior counsel on both sides over several pages of analysis, the Division Bench found no arbitrariness, mala fides, or violation of tender conditions and dismissed the petition.

Issues Involved

  1. Whether Respondent No.4 could rely on the experience and credentials of its group company (Hamon Group) to satisfy the tender's eligibility criteria, despite subsequent changes in shareholding.
  2. Whether the Techno-Commercial Evaluation Summary and Bid Evaluation Summary declaring Respondent No.4 as technically qualified and L1 bidder suffered from arbitrariness, mala fides, or violation of the tender conditions warranting interference under Article 226.

Petitioner's Arguments

  • Respondent No.4 was wrongly declared the L1 bidder as it relied on the experience of its group company (Hamon Group) without satisfying the requirement of continuity/access to that group's proprietary know-how.
  • The tendering authority failed to properly deal with the petitioner's objections regarding Respondent No.4's eligibility and effectively rewrote the tender conditions in Respondent No.4's favour.
  • The evaluation ignored deficiencies in the financial bid submitted by Respondent No.4 and relied on justifications developed after the bids were submitted.
  • Reliance was placed on New Horizons Ltd. v. Union of India to argue that the scope for reliance on a group entity's experience is limited, and that judicial review should intervene where tender conditions are flouted.

Respondent's Arguments

  • The tender conditions did not impose any restriction on reliance on a group company's experience, nor did they mandate continuity of ownership or access to a particular proprietary technology.
  • The evaluation was carried out properly by a competent evaluation committee following the laid-down criteria, and the challenge amounted to an impermissible request for the Court to sit in appeal over a technical/commercial evaluation.
  • The scope of judicial review in tender matters is narrow, and no case of arbitrariness or mala fides was made out; interference at this stage would also cause loss of a beneficial rate to the public exchequer.
  • A company is a separate and distinct legal entity, and Respondent No.4 had a long-standing relationship with the group whose experience it relied upon, satisfying the substance of the tender requirement.

Court Order / Findings

  • The Court held that the tender conditions did not impose any restriction on reliance on the group company's experience and did not require continuity of ownership or access to particular proprietary technology.
  • The principle in New Horizons Ltd. did not advance the petitioner's case on the facts, since the tender conditions themselves permitted the kind of reliance made by Respondent No.4.
  • The petitioner failed to demonstrate that the decision-making process suffered from arbitrariness, mala fides, or violation of tender conditions so as to warrant interference under Article 226.
  • The challenge to the Techno-Commercial Evaluation Summary and Bid Evaluation Summary was rejected, and the writ petition, along with pending applications, was dismissed.

Important Clarification

This is a public-procurement/tender-law judgment and has no bearing on GST. It reaffirms the settled principle that courts exercise only limited judicial review over technical and commercial tender evaluations, and will not interfere merely because a disappointed bidder disagrees with how eligibility criteria were applied, absent arbitrariness or mala fides.

Sections Involved

  • Constitution of India, 1950 — Article 226 (writ jurisdiction over tender/procurement decisions)
  • General principles of public procurement law — as developed through judicial precedent (e.g., New Horizons Ltd. v. Union of India)

Decision – In Favour of

Decided against the petitioner on merits — the challenge to the Techno-Commercial Evaluation Summary and Bid Evaluation Summary was rejected, and the writ petition was dismissed with pending applications closed.

Case Details

  • Court: High Court of Delhi at New Delhi
  • Case No.: W.P.(C) 12270/2024, with CM APPL. 51012/2024, CM APPL. 51013/2024 and CM APPL. 40438/2025
  • Coram: Hon'ble Mr. Justice Anil Kshetarpal and Hon'ble Mr. Justice Amit Mahajan
  • Judgment reserved: 16.04.2026; Pronounced: 23.04.2026

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