THE STATE OF MADHYA PRADESH & ANR. versus U.P. STATE BRIDGE CORPORATION LTD.& ANR.

Citation: [2020] 11 S.C.R. 821 · Decided: 08-12-2020 · Supreme Court of India · Bench: R.F. NARIMAN · Disposal: Disposed off

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Judgment (excerpt)

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THE STATE OF MADHYA PRADESH & ANR.
v.
U.P. STATE BRIDGE CORPORATION LTD.& ANR.
(Civil Appeal No. 4002 of 2020)
DECEMBER 08, 2020
[R. F. NARIMAN AND K. M. JOSEPH, JJ.]
Tender – Rejection of bid on ground of omission and
suppression of relevant fact – Public Works Department of the State
issued a Notice Inviting Tender (NIT) for the construction of an
Elevated Corridor (Flyover) of a length of 7.473 Km – Eleven
Companies bid for the said project including UPSBC, ‘R’ Builders
and ‘Ra’ Construction Co. – The State rejected bid of UPSBC of
sum of Rs. 306.27 crores on the ground that the bidder suppressed
information required under paragraph 13 of Appendix-I-A and
clause 7(b) of Annex-I of NIT – Hence, the bid of UPSBC was
considered to be non-responsive – Likewise, ‘Ra’ Construction Co.
bid for Rs. 293.25 crores did not fulfil the criteria under clause
2.2.2.2(ii) of the NIT for ‘one similar work’ of 25% of the estimated
project cost and was, therefore, considered non-responsive – One
‘R’ builders had bid for Rs.315.80 crores – The High Court in the
Writ Petition filed by UPSBC, held that as on date of submission of
the technical bid, since no investigation was pending within the
meaning of clause 7(b) of Annex-I, there was no suppression of
facts, despite the fact that an FIR had been lodged against it in
respect of a bridge constructed by it earlier and the bridge had
collapsed killing & injuring people – The High Court directed to
issue a Letter of Intent in favour of UPSBC – As far as writ petition
filed by ‘Ra’ Construction Co. is concerned, the High Court referred
to clause 2.2.2.2(ii) of the NIT and held that there was nothing
wrong with the State’s rejection – On appeal, held : The UPSBC is
right when it refers and relies on the format which had to be strictly
complied with and going by the literal reading of the format for
providing declaration, which only required a disclosure of pending
investigations under clause 7(b) of Annex-I of the NIT – However,
the paragraph 13 of Appendix-I-A must be read together with
paragraph 11 thereof, which required the bidder to certify that in
regard to matters other than security and integrity of the country,
[2020] 11 S.C.R. 821
821
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SUPREME COURT REPORTS
[2020] 11 S.C.R.
the bidder was not convicted by a Court of law or indicted – Clearly,
in the instant case, though the investigation was no longer pending
and though there was no conviction by a Court of law, UPSBC was
certainly ‘indicted’, in that, a charge-sheet was filed against it
relatable to the FIR – So, there is an omission of a most relevant
fact and suppression of the same fact, namely that an FIR was lodged
against UPSBC in respect of the construction of a bridge by it – As
a result, UPSBC is disqualified – As far as ‘Ra’ Construction is
concerned, it will not be open for a Constitutional Court to substitute
their view of the view of the tendering authority, when it reads clause
2.2.2.2(ii) in the manner that was done – Therefore, the State directed
to issue Letter of Intent to ‘R’ Builders as far as present tender is
concerned at the same financial bid as that of UPSBC.
Disposing of the appeals, the Court,
HELD: 1. It is clear that UPSBC is right when it refers to
and relies upon the Caratel Infotech judgment for the proposition
that where there is a format which had to be strictly complied
with, his client was justified in going by the literal reading of the
aforesaid format, which only required a disclosure of pending
investigations under clause 7(b) of Annex I of the N.I.T. However,
as has correctly been pointed out by the Additional Advocate
General and ‘R’ Builders that clause 7(b) of Annex I, which is in
terms similar to paragraph 13 of Appendix IA, must be read
together with paragraph 11 thereof, requires the bidder to certify
that in regard to matters other than security and integrity of the
country, the bidder has not been convicted by a court of law or
indicted. Clearly in the facts of the present case, though the
investigation is no longer pending and though there is no
conviction by a court of law, UPSBC has certainly been “indicted”,
in that, a charge sheet has been filed against it relatable to the
FIR dated 15.05.2018 in which a trial is pending, though stayed
by the High Court. Also, Additional Advocate General is correct
in stating that “fraudulent practice”, as defined in clause 4.3(b)
of the N.I.T., would include an omission of facts or disclosure of
incomp

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