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2025 DIGILAW 1836 (TS)

ASG Supreme Laundry Services A Joint Venture Entity, Rep. By Its Authorised Signatory Mr. Vallala Yashodhar v. Union Of India, Rep. By Ministry Of Railways

2025-12-15

NAGESH BHEEMAPAKA

body2025
ORDER : NAGESH BHEEMAPAKA, J. 1. Aggrieved by rejection of its technical bid by Respondents 1 to 3 on the ground that petitioner failed to upload the Memorandum of Association (MOA) and Articles of Association (AOA) of one of its Joint Venture constituents, namely M/s Supreme Laundry Services Joint Venture Pvt. Ltd., petitioner is before this Court. Petitioner contends that such rejection is arbitrary, illegal, contrary to the tender conditions, violative of the principles of natural justice and the Constitution, and has resulted in its wrongful exclusion from further stages of tender process. It accordingly, seeks a declaration that disqualification is illegal and a direction to evaluate its financial bid. 2. The case of petitioner is that, it is a duly- constituted Joint Venture formed by entities having longstanding and demonstrated expertise in operating BOOT- based mechanised laundry systems for the Indian Railways across various zones. It asserts that its members possess extensive experience, technical competence and operational capability and have successfully executed similar high-capacity mechanised laundry projects for several years, thereby establishing a proven track record in the field. It is stated, Respondents 2 and 3 – South Central Railways issued Tender Notice dated 15.05.2025 prescribing, inter alia, a list of documents mandated to be uploaded as part of the technical bid. Tender conditions clearly enumerate the documents required at the technical stage, and that the list did not expressly include Memorandum of Association (MOA) and Articles of Association (AOA) of the non-substantial Joint Venture partner. 2.1. Petitioner asserts, it submitted and uploaded all the essential documents required by the tender, including technical capacity documents, experience certificates, financial turnover details, relevant registrations, statutory declarations and all documents expressly mandated. It states that the only documents not uploaded were MOA and AOA of M/s Supreme Laundry Services Joint Venture Pvt. Ltd., a non-substantial JV constituent. Failure to upload MOA and AOA of the said JV constituent occurred solely due to technical difficulties encountered on the GeM portal, such as repeated file-upload errors, slow or unstable internet connectivity, sudden interruptions, and file-size limitations which prevented successful completion of the upload process. It maintains that these issues were beyond its control and not attributable to any deliberate omission or negligence on its part. 2.2. It maintains that these issues were beyond its control and not attributable to any deliberate omission or negligence on its part. 2.2. Petitioner argues that omission is non-material, procedural and curable, as the JV constituent is a duly- incorporated company and its MOA and AOA are public documents that can be readily verified by the tendering authority either independently or from petitioner's clarification. It asserts that the tendering authority ought not to have treated such a minor technical lapse as a fatal defect leading to automatic disqualification. It is also stated, immediately upon learning of disqualification on 26.07.2025, it submitted clarification dated 27.07.2025 enclosing MOA and AOA and explaining the circumstances under which the documents could not be uploaded. This prompt submission demonstrates its good faith and bona fide intent to comply fully with the tender requirements. 2.3. Petitioner complains that Respondents 1 to 3 refused to examine the clarification, declined to open or consider the attached documents and mechanically adhered to strict literal compliance without appreciating the circumstances or the substantial compliance already achieved by petitioner. According to petitioner, such conduct reflects an overly-rigid and unreasonable approach inconsistent with principles of fair tendering. Petitioner further states that Respondents 1 to 3 adopted a mechanical, predetermined and inflexible stance, disregarding the fact that petitioner had complied with all other tender conditions and submitted an otherwise complete and technically-sound bid. It avers that respondents failed to consider their extensive professional background, proven operational experience and the nature of the work involved. 2.4. Petitioner alleges that rejection of its technical bid is arbitrary, disproportionate and contrary to the basic tenets of fairness in public procurement. It asserts that a minor and unintentional technical omission, which does not go to the root of eligibility, ought not to have resulted in outright rejection, particularly in a competitive tender process impacting public interest. It is further alleged that rejection appears to be calculated to eliminate competition and favour another bidder. Respondents 1 to 3 failed to exercise the discretion available to a tendering authority to condone non-material procedural omissions, especially where such omission neither affects the integrity of the bid nor undermines the evaluation process. 2.5. Petitioner states that, had its financial bid been opened, it would have been the lowest-priced bidder (L1), therefore the natural choice for award of contract. 2.5. Petitioner states that, had its financial bid been opened, it would have been the lowest-priced bidder (L1), therefore the natural choice for award of contract. It asserts that wrongful exclusion at the technical stage has deprived it of a legitimate opportunity and caused severe prejudice. Petitioner states that exclusion from consideration solely on account of a minor defective upload constitutes arbitrariness and discrimination under Article 14 of the Constitution, particularly when the requirement is not expressly listed among the mandatory documents. It maintains that public tendering must be guided by fairness, reasonableness and proportionality and that a minor technical lapse cannot supersede substantive merit and capability. On these grounds, petitioner seeks intervention of this Court to ensure that a non-material and procedural omission does not deprive it of a fair, lawful and meaningful opportunity to participate in the tender and to secure a contract for which it is otherwise technically and financially-qualified. 3. A detailed counter affidavit was filed on behalf of Respondents 1 to 3, contesting the Writ Petition in its entirety and asserting that this Petition is devoid of merit. It is contended that petitioner was rightly and lawfully disqualified at the technical bid stage in strict compliance with the tender terms, and that no interference is warranted by this Court under Article 226 of the Constitution of India. 3.1. It is stated, tender conditions expressly mandate submission of Memorandum of Association (MOA) and Articles of Association (AOA) in every case where bidder is a company or where the Joint Venture comprises a company. They place reliance on Clauses 1.15.2, 1.16.5 and 1.18.3 of the tender document as well as Clause 2.4.1.11.3 of the Indian Railways General Conditions of Contract for Services (2018). These provisions, it is asserted, unequivocally form part of the essential eligibility requirements. 3.2. These Respondents assert that MOA and AOA are fundamental documents that establish legal constitution, structure, internal governance, powers, objects and authority of a company. These documents are indispensable for verifying whether bidding entity or JV partner is legally-competent and duly authorized to enter into contractual obligations with Railways. Therefore, the requirement to upload them is mandatory and not procedural or discretionary. It is emphasized that petitioner was provided with 37 days to upload all documents required under the tender. Despite, they failed to submit the mandatory MOA and AOA of the JV constituent. Therefore, the requirement to upload them is mandatory and not procedural or discretionary. It is emphasized that petitioner was provided with 37 days to upload all documents required under the tender. Despite, they failed to submit the mandatory MOA and AOA of the JV constituent. They deny petitioner's claim of technical difficulties and point out that petitioner successfully uploaded 926 pages of documents, while other bidders uploaded over 1200 pages, thereby demonstrating that the platform functioned properly. 3.3. Respondents state that tender conditions clearly stipulate that responsibility for successful upload of documents rests entirely with the bidder. They emphasize that Railway administration does not assume responsibility for internet issues, server-related problems, technical constraints or connectivity interruptions that may occur on the part of bidders. It is also stated, the tender document categorically prohibits post-bid submission of eligibility documents. Reliance is placed on Clause 9(j) of the tender document read with Clause 1.15.4, which expressly states that documents relating to eligibility, constitution or authority of the bidding entity shall not be accepted after bid submission. Therefore, petitioner's submission of MOA and AOA on 27.07.2025 is impermissible and cannot be taken into consideration. 3.4. It is asserted, tendering authority is prohibited from relaxing or waiving mandatory eligibility conditions for any bidder, as doing so would violate the principles of equal treatment, transparency and fairness applicable to public procurement. They contend that granting such relaxation to petitioner would be impermissible and would undermine the integrity of the tender process. Respondents 1 to 3 also state that similar deficiencies resulted in disqualification of four other bidders; out of the six bidders who participated, only two qualified at the technical stage. This, they argue, evidences consistent, uniform and non-discriminatory application of the tender conditions, thereby dispelling petitioner's allegations of mala fides or favouritism. 3.5. Respondents assert that judicial review in matters relating to tenders is extremely limited. They argue that unless petitioner demonstrates arbitrariness, irrationality, mala fides, bias or violation of statutory provisions, the Court ought not to have interfered. It is asserted, the impugned decision was taken strictly in accordance with tender terms and is supported by objective facts and material. It is also contended, petitioner failed to establish any illegality or procedural irregularity. They argue that unless petitioner demonstrates arbitrariness, irrationality, mala fides, bias or violation of statutory provisions, the Court ought not to have interfered. It is asserted, the impugned decision was taken strictly in accordance with tender terms and is supported by objective facts and material. It is also contended, petitioner failed to establish any illegality or procedural irregularity. They state that petitioner's claim that it would have been L1 is irrelevant in law as financial bids cannot be examined unless technical bid is first found compliant with mandatory conditions. Mere financial advantage cannot override failure to meet essential requirements at the technical stage. 3.6. It is therefore, the categorical stand of Respondents 1 to 3 that petitioner's disqualification is correct, justified and strictly in accordance with tender conditions. They assert that there is no violation of constitutional rights or principles of natural justice, as the tender document itself clearly governs the tender process and binds all participating bidders equally. On these grounds, respondents seek dismissal of Writ Petition contending that petitioner failed to make out any grounds warranting interference with the tendering authority's decision. 4. Heard Sri A. Venkatesh, learned Senior Counsel on behalf of Sri Pramod Malgi, learned counsel for petitioner, Sri B. Narasimha Sharma, learned Assistant Solicitor General on behalf of Respondents 1 to 3 and Sri B. Chandrasen Reddy, learned Senior Counsel on behalf of Sri B. Vamshidhar Reddy, learned counsel for Respondents 3 and 4. 5. Having considered the rival submissions and the materials placed on record, it is evident, the principal issue that arises is whether petitioner's failure to upload MOA and AOA of one JV constituent constitutes a material defect rendering its technical bid liable for rejection, and whether respondent - Railways were obliged to consider the documents subsequently submitted with petitioner's clarification. 6. In this connection, a careful reading of Clauses 1.15.2, 1.16.5 and 1.18.3 of the tender document reveals that, where a Joint Venture includes a company, uploading of MOA and AOA is an essential requirement. These documents form the foundational legal charter of a company and determine its powers, authority, objects and management, all of which are directly relevant for assessing eligibility at the technical stage. Compliance with mandatory tender condition cannot be treated as optional or as a non-material procedural requirement. These documents form the foundational legal charter of a company and determine its powers, authority, objects and management, all of which are directly relevant for assessing eligibility at the technical stage. Compliance with mandatory tender condition cannot be treated as optional or as a non-material procedural requirement. Petitioner's contention that MOA and AOA pertain to non- substantial partner does not dilute the mandatory nature of the requirement. The tender terms do not distinguish between ‘substantial’ and ‘non-substantial’ JV partners for the purpose of uploading constitutional documents, and this Court cannot read such an exception into the tender. 7. It is also significant that tender conditions explicitly prohibit submission of eligibility documents after bid opening. This prohibition is absolute and admits of no exception. The clarification submitted by petitioner on 27.07.2025 cannot therefore, be considered, irrespective of the nature or significance of the omitted document. Once the bid is opened, the tendering authority is bound to evaluate bids strictly on the basis of documents actually submitted on the portal. Respondents have also demonstrated that the same mandatory condition was applied uniformly to all the bidders and that four other bidders were disqualified for similar deficiencies. This negates the allegations of bias or mala fides. 8. It is well-settled, tender conditions are sacrosanct and must be applied uniformly. Courts cannot rewrite tender conditions or direct the tendering authority to relax an essential condition in favour of a particular bidder. Judicial review in tender matters is limited to examine whether the process is vitiated by arbitrariness, irrationality, mala fides or procedural unfairness. None of these grounds are made out in the present case. Petitioner has not produced material of probative value to establish that the tendering authority acted unfairly. The plea of technical difficulty in uploading documents is not persuasive, especially in view of the large volume of other documents successfully uploaded. This Court therefore, finds no infirmity in rejection of petitioner's technical bid. 9. For the reasons stated above, this Court finds no illegality, arbitrariness, mala fides or violation of tender conditions in disqualification of petitioner from the technical stage of Tender Notice dated 15.05.2025 issued by the South Central Railway. 10. The Writ Petition is accordingly, dismissed. No costs. 11. Consequently, Miscellaneous Applications, if any shall stand closed.