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2012 (10) TMI 594 - SC - Indian LawsInternational competitive bidding - Tender process for the completion of the “Breakwater” at LNG Terminal at RGPPL site, Dabhol, Maharashtra- appellant-RGPPL - RDS challenging the rejection of its tender and annulment of the entire tender process - High Court recorded its finding on mala fides - Held that:- The order passed by the High Court did not permit RDS to re-open and re-agitate issues regarding rejection of its bid pursuant to the earlier tender notice and the annulment of the entire tender process, even if the second tender notice sought to disqualify it from competition by altering the conditions of eligibility to its disadvantage. The withdrawal of the earlier writ petition was a clear acknowledgment of the fact that the grievance made by RDS regarding the rejection of its bid had been rendered infructuous as the works in question remained available for allotment in a fresh tender process with everyone otherwise eligible to compete for the same being at liberty to do so. Inasmuch as and to the extent writ petition No.534 of 2011 filed by RDS challenged the rejection of the tender and the annulment process in a second round despite withdrawal of the earlier writ petition filed for the same relief, it was not maintainable. The scope of writ petition no.534 of 2011 was and had to be limited to the validity of the amendment in the conditions of eligibility introduced by RGPPL in the second tender notice issued by it. The RGPPL as the owner acting as a prudent and responsible public authority discharging public trust obligations was well within its rights to raise questions and seek answers on an important matter like the eligibility of RDS to participate, no matter EIL and GAIL had on the basis of the certificates produced before them recommended RDS as an eligible bidder. There was in that view no justification for either RDS or the High Court to raise an accusing finger against RGPPL simply because it had demanded proof regarding the claim of eligibility from RDS or collected relevant information under RTI Act and referred the material so collected to GAIL and EIL for evaluation and opinion. The final decision to scrap the project being within its powers under the terms of the tender notice RGPPL’s invocation of that power was not in the facts and circumstances vulnerable to challenge on the ground of malice in fact or law, on the grounds set out by the High Court even assuming that writ petition No.534/2012 was maintainable notwithstanding the withdrawal of the earlier petition filed by RDS. High Court has recorded its finding on mala fides on the sole basis that EIL had reviewed its earlier opinion regarding eligibility of RDS. The High Court was wrong in doing so. While the High Court could find fault with the interpretation which EIL placed on the provisions of clause 8.1.1.1 on the basis of the legal opinion tendered to it, it went too far in dubbing the entire process as mala fide. Thus the findings recorded by the High Court to the effect that the process of annulment of the tender process or the rejection of the tender submitted by RDS was vitiated by mala fides is unsustainable. The High Court ought to have examined the issue on merits, rather than taking a short cut. The High Court has incidentally taken support from the certificate dated 5th April, 2008 and clarification issued on 5th June, 2010 to hold that the RDS had indeed executed the qualifying project at Car Nicobar. As in the course of the hearing to disclose the basis on which the certificate and the clarification had been issued by the officers concerned no satisfactory answer to the query. Also to produce the relevant record including the government files regarding eligibility of RDS but in the absence of any conclusive evidence, and in the absence of a specific finding from the High Court, on the question, we remained handicapped - set aside the judgment and order passed by the High Court and remand the matter back to the High Court to examine and decide afresh whether RDS was eligible to compete for the works in question in terms of the first tender notice based on the works which it claims to have executed at Mus in Car Nicobar.
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