Dismissed

Eleventure Systems and Services Private Limited v. Gail Gas Limited

Delhi HC16 Feb 2024W.P.(C)/2338/2024

Case brief

AI extract

What is this about?

The petitioner challenged the quashing of a refloated tender by GAIL Gas Limited. The Court dismissed the writ petition as the petitioner failed to disclose its participation in the refloated tender, approached the Court with unclean hands after the bid opening, and the tendering process was found reasonable.

What the court decided

AI extract

Eleventure Systems and Services Private Limited… — Public Procurement and Tenders | Delhi HC (2024)

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$~27

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IN THE HIGH COURT OF DELHI AT NEW DELHI

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- W.P.(C) 2338/2024 and CM APPL. 9694/2024

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ELEVENTURE SYSTEMS AND SERVICES PRIVATE LIMITED

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..... Petitioner

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Through: Mr. Bhupesh Narula, Mr. Mayank Wadhwa and Ms. Muskan Gupta, Advocates

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versus

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GAIL GAS LIMITED

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..... Respondent Through: Ms Purnima Maheshwari, Standing Counsel GGL with Mr. D.K. Singh Advocate with Mr. Kunal Dubey and Mr. Nitin Gupta from Department

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% Date of Decision: 16^th February, 2024

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CORAM:

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HON'BLE THE ACTING CHIEF JUSTICE HON'BLE MS. JUSTICE MANMEET PRITAM SINGH ARORA JUDGMENT

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MANMOHAN, ACJ : (ORAL)

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CM APPL. 9693/2024 (for exemption)

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Allowed, subject to all just exceptions.

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Accordingly, the present application stands disposed of.

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W.P.(C) 2338/2024 Page 1 of 7

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Signature Not Verified

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Signed By:MAHIMA SHARMA Signing Da te:1 9.02.2024 12:47:24

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W.P.(C) 2338/2024 and CM APPL. 9694/2024

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The present petition has been filed under Article 226 of the Constitution of India seeking quashing and setting aside of the Tender bearing No. GAIL GAS/NOIDA/4532/NKG/2023-24/82, refloated by the Respondent i.e., GAIL Gas Limited on 26^th December, 2023 (‘refloated tender’).

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3.1. The said tender was originally issued by the Respondent bearing No. GAIL GAS/NOIDA/4487/NKG/2023-24/56 on 13^th October, 2023 (‘first Tender’), for hiring of agencies for Last Mile Connectivity (‘LMC’) works at Sonipat (Part A), Meerut (Part B) and Dewas (Part C).

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3.2. The Petitioner, in accordance with the terms of the first tender, submitted its bid on 03^rd November, 2023. The Petitioner emerged as the sole eligible bidder for Part A and Part B and was therefore, the L1 bidder. 3.3. The Petitioner has stated that on 03^rd January, 2024, it was surprised to receive an email for rejection of its bid submission (629222) qua the first tender, citing the reason that the price quoted by the Petitioner in the bid was higher than the in-house estimate of the Respondent. It is stated that the Petitioner was never invited to seek clarifications or for negotiations as contemplated in the bid document.

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3.4. The Petitioner has stated that it, subsequently, learnt that Respondent had refloated the tender on 26^th December, 2023 for Part A and Part B during the pendency of the validity of the earlier (first tender). It is stated that Petitioner had no inkling with respect to the refloating of the tender on 26^th December, 2023. It is stated that refloating the tender on 26^th December,

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Signature Not Verified

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W.P.(C) 2338/2024 Page 2 of 7

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Signed By:MAHIMA SHARMA Signing Da te:1 9.02.2024 12:47:24

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2023, during the validity and pendency of the first tender for the same subject matter, is illegal and arbitrary. It is stated that the refloating has been carried out to favour select bidders by setting favorable eligibility terms.

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3.5. The Respondent, who entered appearance on advance service has stated that the Petitioner has not disclosed in the petition that it has duly participated in the refloated tender dated 26^th December, 2023 and submitted its bid on 05^th January, 2024.

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Arguments of the Petitioner

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Learned counsel for the Petitioner states that admittedly, Petitioner was ranked as L1 bidder for Part A and Part B. He states that the Petitioner remained ready and willing to perform the contract. He states that while the Petitioner was awaiting the award of the tender, it was surprised to receive an email on 3^rd January, 2024 rejecting the bid. He states that the Petitioner was willing to negotiate the financial bid, however, it was not invited for any negotiations as contemplated under the bidding terms.

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He states that the Petitioner has learnt that Respondent arbitrarily refloated the tender on 26^th December, 2023, during the validity of the Petitioner’s bid. He states that the Petitioner learnt about the said fresh tender subsequently and to mitigate its losses, it participated in the fresh tender process by submitting the bid on 5^th January, 2024. He states that the Petitioner wrote a protest letter to the Respondent on 08^th January, 2024 with respect to the aforesaid illegalities.

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He states that in the rejection letter, the Respondent states that the Petitioner’s L1 bid has been rejected as it is higher than the in-house

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Signature Not Verified

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W.P.(C) 2338/2024 Page 3 of 7

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Signed By:MAHIMA SHARMA Signing Da te:1 9.02.2024 12:47:24

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estimate. He states that, however, there was no indication in the bidding document that the bidder cannot submit a bid for a higher amount than the estimate.

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He states that in the tender dated 26^th December, 2023, the condition of furnishing Earnest Money Deposit (‘EMD’) has been deleted. He states this has led to participation of new bidders in the second round and Petitioner believes that this condition has been relaxed to favour a particular bidder.

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Argument of the Respondent

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In reply, learned counsel for the Respondent states that the Petitioner has suppressed in the writ petition that it participated in the refloated tender on 26^th December, 2023 and duly submitted its bid on 05^th January, 2024. She states that the refloating of the tender on 26^th December, 2023 was duly communicated to the Petitioner by an email dated 26^th December, 2023.

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She states that the Petitioner’s bid dated 3^rd November, 2023, submitted in pursuance of the first tender was evaluated and found to be 44% higher than the in-house estimate for Part A and 40% higher for the inhouse estimate for Part B. She states that in the first tender, the Petitioner was the sole eligible bidder. She states that the remaining bidders were declared ineligible as they had failed to furnish EMD. She states that Petitioner also did not furnish an EMD in the firt round and sought an exemption on the basis that it is a Startup. She states that in these facts, the Respondent determined that to elicit best prices, the first tender should be cancelled and refloated with the deletion of the EMD clause.

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Signature Not Verified

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W.P.(C) 2338/2024 Page 4 of 7

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Signed By:MAHIMA SHARMA Signing Da te:1 9.02.2024 12:47:24

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She states that in the re-tendering conducted on 26^th December, 2023, 22 bids have been received which includes the bid of the Petitioner. She states that therefore, there has been a wider participation in this second round. She states that the tender has been issued on open tender basis on the NIC portal and all bidders have a level playing field.

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She states that in the first tender for Part C, the tender has been awarded to the L1 bidder therein, who quoted a price which is 12.60 % lower than the in-house estimate. She states, however, the award of the said Part C is not a subject matter of the challenge in this writ.

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Analysis and findings

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This Court has considered the submission of the parties and perused the record.

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This Court finds merit in the submission of the Respondent that the Petitioner has failed to make a full disclosure of the material fact that on 05^th January, 2024 it has duly participated in the refloated tender dated 26^th December, 2023. The Petitioner has neither disclosed the said fact in the synopsis and the list of dates nor annexed the documents evidencing submission of the bid. The Petitioner has relied upon a inconspicuous sentence tucked away in paragraph 14 (XVI) to allege disclosure of its participation in the second round; which, in our considered opinion, is wholly inadequate and fails to meet the requirements of full disclosure.

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The said fact is material for the reason that the Petitioner participated in the refloated tender dated 26^th December, 2023 unconditionally and without any demur by submitting its bid on 05^th January, 2024. The

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Signature Not Verified

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W.P.(C) 2338/2024 Page 5 of 7

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Signed By:MAHIMA SHARMA Signing Da te:1 9.02.2024 12:47:24

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submissions of the second round of bid closed on 05^th January, 2024. The bids were scheduled to be opened on 08^th January, 2024 at 03:00 PM. It is at this belated stage, the Petitioner, for the first time, wrote an email on 08^th January, 2024 at 02:24 PM alleging breach. In the aforesaid facts, the email dated 08^th January, 2024 clearly appears to be an afterthought.

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The Petitioner has not disclosed the date on which it learnt about the refloating of the tender dated 26^th December, 2023. The non-mention of the date is not innocuous and lends credence to the submission of the Respondent that the Petitioner duly received the email dated 26^th December, 2023, issued by Respondent itself to the Petitioner informing it about the refloating of the bid.

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Further, the present writ petition has been filed a month later on 09^th February, 2024, whereas, the bids have already been opened on 08^th January, 2024 in the second round pursuant to the refloating. The unqualified participation of the Petitioner in the bidding process between 05^th January, 2024 and 08^th January, 2024 as well as the inaction for an entire month thereafter, is indicative of the facts that the present petition has been filed with a view to de-rail the tendering process. We, therefore, find that the Petitioner has approached the Court with unclean hands and the petition deserves to be dismissed.

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Even on merits, we are not persuaded with the contentions of the Petitioner that the deletion of the condition of EMD in the refloated tender is arbitrary. The explanation furnished by the Respondent that the said condition was deleted to encourage wider participation appears reasonable in

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Signature Not Verified

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W.P.(C) 2338/2024 Page 6 of 7

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Signed By:MAHIMA SHARMA Signing Da te:1 9.02.2024 12:47:24

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the facts of this tender. Admittedly, at the first tender, the Petitioner emerged as the sole eligible bidder due to the condition of the EMD and the Petitioner itself did not comply with the said condition by seeking exemption. Thus, the insistence of the Petitioner on the said condition while seeking exemption for itself cannot be entertained at its behest.

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Similarly, this Court finds no ground to interfere with the Respondent’s decision of rejection of the Petitioner’s bid dated 03^rd November, 2023 on the ground that it is 44% higher for Part A and 40% higher for Part B respectively in comparison with the inhouse estimate. The intent of the Respondent to conserve the public exchequer by seeking competitive pricing from otherwise technically eligible bidders cannot be considered to be arbitrary or irrational.

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In view of the aforesaid findings, the writ petition is dismissed. Pending applications stand dismissed.

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ACTING CHIEF JUSTICE

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MANMEET PRITAM SINGH ARORA, J

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FEBRUARY 16, 2024/ hp/sk

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Signature Not Verified

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W.P.(C) 2338/2024 Page 7 of 7

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Signed By:MAHIMA SHARMA Signing Da te:1 9.02.2024 12:47:24

Eleventure Systems and Services Private Limited v. Gail Gas Limited

Case brief

What is this about?

What the court decided

Eleventure Systems and Services Private Limited v. Gail Gas Limited

Case brief

What is this about?

What the court decided

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Case details

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