top of page

Technical objection based on rejection order can't be allowed on suppression of a material fact: SC

We have already held that paragraph 13 has to be read along with paragraph 11, which clearly states that a person who is “indicted” for a criminal offence has to disclose the factum of indictment. A technical objection based on the rejection order cannot be allowed to prevail in the face of the suppression of a most material fact, that is of an FIR pertaining to the construction of a bridge by UPSBC, which has collapsed. (Para 21)

The State Of Madhya Pradesh & Anr. V. U.P. State Bridge Corporation Ltd. & Anr.

Civil Appeal No. 4002 of 2020 (Arising Out Of SLP (C) No. 8496 Of 2020) with

Civil Appeal No. 4003 of 2020 (Arising Out Of SLP (C) No.8738 Of 2020) with

Civil Appeal Nos. 4004-4005 of 2020 (Arising Out Of SLP (C) Nos.9539-9540 Of 2020)

8th December, 2020.

Counsel for Appellants: Shri Saurabh Mishra.

Counsel for Respondents: Shri Dhruv Mehta, Shri Anupam Lal Das.

The Hon'ble Supreme Court Justices Rohinton Fali Nariman and K.M. Joseph in an appeal pertaining to a notice inviting tender for the construction of a flyover set aside the appeals.

The appeals pertain to a notice inviting tender which was for the construction of an Elevated Corridor (Flyover) to be completed within a period of 24 months including the rainy season. Insofar as UPSBC is concerned in the above bid, the State of Madhya Pradesh rejected its bid on the ground that the bidder suppressed information required under Appendix IA and Annex I. Hence, the aforesaid bid was considered to be non-responsive. Pursuant to the rejection of the technical bid of UPSBC in the Technical Evaluation Committee’s meeting, a writ petition was filed and the financial bid of UPSBC was ordered to be opened. It was held by UPSBC that as on the 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 by UPSBC, despite the fact that an FIR had been lodged against it in respect of a particular bridge constructed by it at Varanasi which had collapsed, killing 15 persons and injuring 11 persons. The trial was stayed. Despite these facts not being stated in the bid document submitted by UPSBC, the High Court found that there was no suppression of facts, as clause 7(b) of Annex I only required details as to investigations that were pending. Public interest therefore demanded that the rejection of UPSBC’s technical bid be set aside. Concerning the petition by respondent 2, the High Court also held that despite knowing that UPSBC had filed a writ petition, neither did it intervene in the said writ petition nor filed an independent writ petition on its own until much later.

The Additional Advocate General held that the expression “investigation pending” cannot be taken to be in the sense of the Cr.P.C., as otherwise the said clause would be rendered otiose. “Investigation pending” would necessarily include within its scope all subsequent steps towards criminality of an accused, as a result of which clause 7(b) of Annex I required UPSBC to disclose material facts. He also relied upon the clause dealing with “fraudulent practice” and stated that the omission of a material fact would amount to a fraudulent practice, and this being a most material fact, as a particular bridge constructed by UPSBC had collapsed resulting in an FIR being lodged against it, not being disclosed by UPSBC, would be fatal under the fraudulent practice clause also.

The counsel for UPSBC relied heavily on the judgment in Caretel Infotech Ltd. v. Hindustan Petroleum Corpn. Ltd., (2019) 14 SCC 81, for the proposition that where a tender was in a particular format, nothing beyond the information that is required by that format need be given, and since no investigation was in fact pending against his client, clause 7(b) of Annex I could not have been invoked to non-suit his client. He stated that no ground other than clause 7(b) of Annex I could now be taken, as the ground of fraudulent practice, which was sought to be argued by the State of Madhya Pradesh in this Court, was not a ground on which UPSBC’s bid was rejected.

The court observed that it is correctly put that where there is a format which had to be strictly complied with, the 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. Certain provisions of Annex I and Appendix IA 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. Here, it is very clear that there is an omission and suppression of an important fact which is the FIR filed against UPSBC regarding the accident. A technical objection based on the rejection order cannot be allowed to prevail in the face of the suppression of a most material fact.

It will not be open for a constitutional court, in accordance with all the decisions cited hereinabove, to substitute their view of the view of the tendering authority. Suffice it to say that the expression “at least one similar work” could possibly mean only one such work, namely, the construction of one such bridge and not two such bridges, even if two bridges were to be constructed under the same tender document. It is not possible, therefore, for this Court to say that the construction of the aforesaid clause by the tendering authority is an impossible one rendering it perverse. Hence, the court sets aside the petitions.

M. Maheswari



bottom of page