2000 (5) TMI 1081 - SC - Indian Laws

Summary

Issues Involved:
1. Validity of the High Court's decision to set aside the award of contract to M/s. Monarch Infrastructure (P) Ltd.
2. Justification for directing a fresh tender process instead of awarding the contract to M/s. Konark Infrastructure (P) Ltd.
3. Effect of the steps taken by the Municipal Corporation to call for fresh tenders.

Summary:

1. Validity of the High Court's Decision:
The High Court set aside the award of the contract to M/s. Monarch Infrastructure (P) Ltd. because it did not fulfill the conditions of Clause 6(a) of the Tender Notice, which was deleted after the last date for submission of tenders. The High Court found that the Municipal Corporation acted arbitrarily by considering the bid of M/s. Monarch Infrastructure (P) Ltd., which did not meet the eligibility conditions on the prescribed date. The Court emphasized that fairness and equal treatment required a fresh tender process to determine if better offers would be received after the deletion of Clause 6(a).

2. Justification for Fresh Tender Process:
The High Court directed a fresh tender process instead of awarding the contract to M/s. Konark Infrastructure (P) Ltd. because altering the tender conditions after the submission deadline was akin to changing the rules of the game mid-way. The Court held that a fresh tender process was necessary to ensure a wider participation and potentially more attractive bids, thus serving public interest.

3. Effect of Steps Taken by Municipal Corporation:
The Supreme Court noted that the Municipal Corporation had already initiated steps for a fresh tender process. The Court upheld the High Court's decision, emphasizing that public interest would be served by completing the tender process and accepting the highest offer made by M/s. Monarch Infrastructure (P) Ltd., provided it matched the bid of Rs. 42 crores offered by Ramchand Mahadeo Rao. The Court rejected the tender offer of Ramchand Mahadeo Rao due to non-compliance with the earnest money deposit condition.

Conclusion:
The Supreme Court upheld the High Court's order, directing the Municipal Corporation to proceed with the fresh tender process and accept the highest valid bid, ensuring fairness and public interest in the tender process.