Summary
The Supreme Court restored BHEL’s award of an ash-handling-plant contract to an Indian bidder using technical support from a Chinese collaborator. On the tender terms and actual agreement, this was a standalone bid with a service arrangement, rather than a bid by a consortium requiring registration of the Chinese entity. The tendering authority’s reasoned technical assessment warranted restraint in judicial review. Advanced implementation and the public project’s interests further weighed against displacing the contract.
Issues
- Whether the technical collaboration created a bidding consortium attracting the procurement-registration restriction.
- Whether the Division Bench properly displaced the tendering authority’s assessment and the Single Judge’s refusal to interfere.
Provisions considered
- Clauses 1, 6, 8 and 11, read with OM dated 8 February 2021, Public Procurement Order No. 1 dated 23 July 2020Registration restrictions applied to specified foreign bidders and works subcontractors, while the clarification excluded procurement of goods and services per se. On the agreement’s substance and tender structure, the Chinese service collaborator was not part of a bidding consortium requiring registration here. (¶¶ 9, 10, 11, 24, 29, 30, 31, 32, 33)
Held
- The tender expressly permitted an otherwise qualified bulk-material-handling bidder to meet specified additional technical requirements through a collaborator. That technical-support agreement differed from the bidding consortium contemplated by clause 7.2: the Chinese entity had no ownership or equity in the project and did not contribute to the bid. (¶¶ 4, 5, 6, 7, 8, 21, 22, 23, 31, 32)
- BHEL reasonably assessed the arrangement as a service agreement supporting a standalone Indian bid, rather than a joint bid. Read with the 2021 clarification, the procurement order did not require registration of that service collaborator in these circumstances. The conclusion depended on the agreement’s substance, not its consortium label alone. (¶¶ 24, 29, 30, 31, 32, 33)
- Courts reviewing complex technical tenders must scrutinise the decision-making process for arbitrariness, irrationality, bias or mala fides, while respecting the authoring authority’s reasonable interpretation. They do not act as appellate tender evaluators; a writ appellate court should ordinarily interfere with a Single Judge only for error or perversity. (¶¶ 34, 35, 36, 37, 38)
- The competing bidder’s offer to match the price did not justify disruption. Although ongoing work created no special equity for the successful private bidder, the substantial progress and public entities’ investments independently mattered to the project’s implementation. (¶¶ 28, 38, 39)
Result
Appeals allowed without costs. Division Bench judgment set aside; Single Judge’s dismissal of the writ petition restored, sustaining the contract award. Pending applications disposed of.