Hatimuria Developers Private Limted v. State of Assam
2025-07-18
MICHAEL ZOTHANKHUMA
body2025
DigiLaw.ai
ORDER : MICHAEL ZOTHANKHUMA, J. Heard Mr. B. Pathak, learned counsel for the petitioner. Also heard Mr. P. Nayak, learned Addl. A.G. for the respondent Nos. 1 to 3. 2. The petitioner is aggrieved with the minutes of the Bid Evaluation Committee held on 25.06.2025, wherein the petitioner’s technical bid was declared non-responsive, on the ground that the petitioner had not submitted a copy of the Power of Attorney proving that the Power of Attorney holder had signed the bid documents and not furnishing a copy of the Memorandum of Articles of Association in terms of Clause 3.4 of the Information and Guidelines for bidders (Section – II: Technical Bid), which states as follows:- “ 3.4 If the bidder is a limited company or a corporation, the application shall be signed by a duly authorized person holding power of attorney for signing the application accompanied by a copy of the power of attorney. The bidder should also furnish a copy of the Memorandum of Articles of Association duly attested by a Public Notary.” 3. Clause 3.4 of the Information and Guidelines for bidders required the bid documents to be signed by a duly authorised person holding a Power of Attorney, if the bidder was a limited company or a corporation. The bid documents were also to be accompanied by a copy of the Power of Attorney. The bidders were also required to furnish Memorandum of Articles of Association duly attested by a Public Notary. 4. The petitioner’s case is that the petitioner is a Private Limited Company, which will come under the word “Corporation”. The petitioner being a company can be duly represented in contract matters by its Director, in terms of Section 21 of the Companies Act, 2013. 5. In the present case pertaining to the NIT dated 07.03.2025, for “construction of a Training Institute at Dhamdhama, Nalbari in Engineering, Procurement and Construction (EPC) Mode-I Basis”, the petitioner company was represented by its Director, who had signed the tender documents. However, the Director had not been given any Power of Attorney by the company, though there was a board resolution, authorising the Director to sign the bid documents. 6.
However, the Director had not been given any Power of Attorney by the company, though there was a board resolution, authorising the Director to sign the bid documents. 6. The petitioner’s counsel submits that as the Director can represent a company in contractual matters, in terms of Section 21 of the Companies Act, 2013, there was no requirement for the Director, who had signed the bid documents, to have a Power of Attorney. As such, no copy of a Power of Attorney had been furnished by the petitioner. 7. The petitioner’s counsel submits that Clause 20 of the “Information and Instructions for contractors for e-Bidding” provided the list of documents to be filled in by the bidders, scanned and uploaded within the period of bid submission. The said Clause 20 provided for various documents. However, Clause 20 did not make a mention of the requirement of furnishing a copy of the Power of Attorney or Memorandum of Articles of Association duly attested by a Public Notary. As such, the petitioner’s bid could not have been rejected, just because the Power of Attorney and Memorandum of Articles of Association had not been uploaded/furnished by the petitioner. 8. The petitioner’s counsel submits that the registration of the petitioner as a company is granted only after verification of documents and credentials, including the Memorandum of Articles of Association made by the petitioner. The certificate of incorporation is also based on such Articles of Association. As the petitioner was already registered with the PWD (Building), Assam, there was no requirement for the petitioner to establish the objectives of the company and as such, the respondents should have waived the non-compliance of the non- mandatory Clause, i.e. Clause 3.4. He also submits that the technical bid submitted by the petitioner should be declared technically responsive. 9. Mr. P. Nayak, learned Addl. A.G., submits that the requirement of the person signing the bid documents, by way of a Power of Attorney holder, was uniformly applied not only in respect of the limited company or a corporation, but also in respect of a partnership firm in terms of Clause 3.3.
9. Mr. P. Nayak, learned Addl. A.G., submits that the requirement of the person signing the bid documents, by way of a Power of Attorney holder, was uniformly applied not only in respect of the limited company or a corporation, but also in respect of a partnership firm in terms of Clause 3.3. The petitioner, knowing fully well the implication of Clause 3.4 of the “Information and Guidelines for bidders”, could have asked for a clarification with regard to Clause 3.4, if it felt that there was no requirement for submitting the bid documents signed by a Power of Attorney holder. The petitioner could also have asked for a pre-bid clarification, requiring whether submission of a Power of Attorney and Memorandum of Articles of Association duly attested by a Public Notary was mandatory or not. However, the petitioner failed to do the same and instead submitted his bid with open eyes, in violation of Clause 3.4. He submits that the question of whether a clause in the tender is mandatory or ancillary, is to be decided by the author inviting the tender and the interpretation given by the author has to be respected. Further, there is no ambiguity in the language of Clause 3.4 of the Information and Guidelines for bidders and the same would have to be read along with Clause 20 of the Information and Instructions for contractors for e-Bidding. 10. Mr. Nayak further submits that not only has there been no challenge made to Clause 3.4, but the petitioner has also only requested for waiving compliance with Clause 3.4, on the ground that it is not a mandatory clause, by justifying non-submission of the Power of Attorney and Memorandum of Articles of Association. The learned Addl. A.G. submits that as Clause 3.4 is an essential condition of the tender, it has to be mandatorily followed. 11. I have heard the learned counsels for the parties. 12. In the case of Afcons Infrastructure Ltd. Vs. Nagpur Metro Rail Corpn. Ltd., reported in (2016) 16 SCC 818 , the Supreme Court has held that the owner or the employer of a project, having authored the tender documents, is the best person to understand and appreciate it’s requirements and interpret it’s documents.
12. In the case of Afcons Infrastructure Ltd. Vs. Nagpur Metro Rail Corpn. Ltd., reported in (2016) 16 SCC 818 , the Supreme Court has held that the owner or the employer of a project, having authored the tender documents, is the best person to understand and appreciate it’s requirements and interpret it’s documents. The constitutional courts must defer to this understanding and appreciation of the tender documents, unless there is mala fide or perversity in the understanding or appreciation or in the application of the terms of the tender conditions. It is possible that the owner or employer of a project may give an interpretation to the tender documents that is not acceptable to the constitutional courts, but that by itself is not a reason for interfering with the interpretation given. 13. In the case of Silppi Constructions Contractors Vs. Union of India, reported in (2020) 16 SCC 489 , the Supreme Court has held that Court’s interference in the terms and conditions of a tender should be minimal. It has also been held by the Supreme Court in the case of Vidarbha Irrigation Development Corporation and Ors. Vs. Anoj Kumar Agarwala and Ors., reported in (2020) 17 SCC 577 that the words used in the tender documents cannot be ignored or treated as redundant or superfluous and they must be given meaning and their necessary significance. 14. Given the fact that an essential tender condition, which had to be strictly complied with, was not so complied with, the authorities would have no power to condone lack of such strict compliance. This, in my view, Clause 3.4 would have to be strictly followed, unless relaxation of the said mandatory clause is given to all the bidders. However, in the instant case, when Clause 3.4 had been applied strictly and no relaxation has been given to the same, there is no question of the petitioner being given special treatment. Further, when the Author of the tender has interpreted Clause 3.4 to be a mandatory/essential condition of the tender, there is no reason for this Court to come to a different interpretation or decision. 15. In the case of Tata Motors Ltd. Vs.
Further, when the Author of the tender has interpreted Clause 3.4 to be a mandatory/essential condition of the tender, there is no reason for this Court to come to a different interpretation or decision. 15. In the case of Tata Motors Ltd. Vs. Brihan Mumbai Electric Supply & Transport Undertaking (BEST) and Ors., reported in 2023 SCC OnLine SC 671 , the Supreme Court has held that Courts should exercise a lot of restraint while exercising their powers of judicial review in contractual or commercial matters. 16. Coming to the facts of the present case, Clause 3.4 of the Information and Guidelines for bidders required that the bid documents should be signed by a Power of Attorney holder and a copy of the Power of Attorney was to be submitted along with the bid documents. Further, a copy of the Memorandum of Articles of Association duly attested by a Public Notary was also to be furnished by the bidder. In the present case, the petitioner’s bid documents were not signed by a Power of Attorney holder. Further, neither was a copy of the Power of Attorney nor the Memorandum of Articles of Association submitted along with the tender documents. The only ground taken by the petitioner in his representation dated 01.07.2025 for non-submission of the said two documents and non-signing of the bid documents by a Power of Attorney holder is on the ground that Clause 3.4 was a non-mandatory clause. 17. Interestingly, Clause 3.4 of the Information and Guidelines for bidders has not been put to challenge by the petitioner and neither did the petitioner ask for any pre-bid clarification. As such, it submitted it’s bid, knowing fully well the requirements of Clause 3.4. 18. Just because Section 21 of the Companies Act, 2013 provides that a document or contracts made by or on behalf of a company, may be signed by a Key Managerial Personnel or an Officer or employee of the company duly authorized by the Board in this behalf, does not mean that Section 21 of the Companies Act makes Clause 3.4 redundant. Clause 3.4 not having been put to challenge, the petitioner cannot now turn around and say that the said Clause was a non-mandatory clause.
Clause 3.4 not having been put to challenge, the petitioner cannot now turn around and say that the said Clause was a non-mandatory clause. Further, when the petitioner has participated in the tender process without any reservation and with open eyes, the petitioner cannot be allowed to subsequently turn around and say that Clause 3.4 is not mandatory, after its technical bid has been rejected. 19. In the present case, there is nothing to show that the action of the State respondents in declaring the petitioner’s bid to be non-responsive is found to be malicious, unreasonable, arbitrary or a misuse of its powers. In the case of M/s Michigan Rubber (India) Limted –vs- State of Karnataka & Ors. reported in (2012) 8 SCC 216 , the Supreme Court has held that in the matter of formulating conditions of a tender document and awarding a contract, greater latitude is required to be conceded to the State respondents, unless the action of the tendering authority is found to be malicious, arbitrary, discriminating, mala fide, biased, irrational or a misuse of its statutory powers. 20. Clause 3.4 having clearly required the tender documents to be signed by a Power of Attorney holder and the same not having been done by a Power of Attorney holder, this Court does not find any ground to interfere with the decision of the State respondents. Further, a Board resolution cannot be said to be a Power of Attorney. 21. The petitioner also having failed to furnish a copy of Power of Attorney and copy of Memorandum of Articles of Association, this Court does not find any discrimination, arbitrariness, biasness or irrationality in declaring the petitioner’s technical bid to be non-responsive, especially when Clause 3.4 is stated to be a mandatory/essential condition of the tender by the State respondents. 22. In view of the reasons stated above, this Court does not find any reason to exercise its discretion in the present case. The writ petition is accordingly dismissed.