10 June 2024


High Court of Bombay

O.K. Marine Vs. Oil and Natural Gas Corporation Ltd. and Ors.




To fault a decision of the employer, there must be a case of either perversity in the decision or a colourable exercise on part of employer

The Petitioner challenges the impugned award of contract to Respondent Nos. 4 and 5 by denying opportunity to the Petitioner. It is, submitted that the Petitioner's bid does not involve any breach of the Integrity Pact. It is submitted that, there is no prohibition on relatives participating in the tendering process. Further, the Petitioner's tender cannot be rejected simply on the basis of surmises, especially when his bid has been found to be technically responsive.

To fault a decision of the Respondent employer, there must be a case of either perversity in the decision or a colourable exercise on the part of the employer. The decision of the Respondent employer has been supported by some material on record; it does not take into account any irrelevant or non-germane fact or circumstance; it is clearly a possible decision based on the materials available before the employer. Even if the State cannot act in a matter of commercial contract in a wholly unreasonable or arbitrary or capricious manner, its administrative decision cannot be put on the pedestal of a quasi-judicial decision.

There is nothing sacrosanct about finding the technical bid of a bidder responsive in a two bid system so as to make it obligatory on the employer to open the commercial bid. The employer may well come upon knowledge of some relevant information, which disqualifies the particular bidder, and in that case may choose not to open his commercial bid. If his disqualification is supported by some material on record, there is nothing further for this Court to inquire. It cannot be suggested that. In all cases after his technical bid has been accepted, the bidder cannot be disqualified, except after opening of his commercial bid.

It is not necessary for the employer to come to a conclusion of a possible case of cartelization only after opening of commercial bids. There may be other tell-tale circumstances, which clearly suggest a case of cartelization . In any event, cartelization per se is not a ground on which the Petitioner's bid has been rejected; what was relevant for rejection of the Petitioner's bid was a probable undisclosed agreement or understanding, formal or informal, which has the tendency of restricting competitiveness. The end result of the difference in pricing is not such as would invite this Court's interference in its writ jurisdiction in the facts of the case. Petition dismissed.

Tags : Tender Award Legality

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