9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (8) TMI 171 - HC - Money LaunderingRejection of bids submitted by the petitioner - seeking direction to respondents to allow the Petitioner to bid for and compete in the contracts in future and tenders even during the pendency of proceedings under ECIR - pendency of proceedings/enquiry against any Director in his individual capacity - enquiries pending against a company which merely got merged/amalgamated/taken over by a successor company - enquires / proceedings can be the basis of denying the Petitioner company from either participating or being considered and/or award of tenders/contracts or not - HELD THAT - The present tender was floated by Labs of Respondent No. 2 which are specialised labs engaged in research pertaining to critical defence technologies and systems. It is in this context that the Respondent Nos. 3 and 4 have imposed the Impugned Condition to sift through entities which have criminal proceedings/investigation pending against them. This condition is imperative to maintain the integrity of such projects which deal with maters of national importance security and are of immense public importance. Considering the nature of the work undertaken by the Respondents it is evident that the Impugned Condition is not arbitrary discriminatory mala fide or actuated by bias. Hence this Court does not find any infirmity with the Impugned Condition and is disinclined to interfere with it. The material on record shows that there are allegations that the key managerial personnel nature of work and functioning of the Petitioner Company is the same as ADPL and the Petitioner Company has allegedly benefitted from the proceeds of crime to the tune of Rs. 2, 36, 25, 000/- received by ADPL as these were transferred to the Petitioner Company. Hence the Petitioner cannot claim that it has been unfairly excluded the Petitioner from participating in the bid - this Court is not inclined to interfere with the Impugned Condition or the decision of the Respondent Nos. 2-4 from excluding the Petitioner from participating in the said tender process. Petition dismissed.
Issues Involved:
1. Validity of rejecting the Petitioner's bids due to the pendency of ECIR no. 12/STF/2019. 2. Legality of Clause 7.2.19 of the DRDO Procurement Manual, 2020. 3. Impact of pending enquiries against Directors on the company's eligibility. 4. Effect of amalgamation on the successor company's eligibility for tenders. 5. Judicial review of tender conditions and decisions. Issue-wise Detailed Analysis: 1. Validity of Rejecting the Petitioner's Bids Due to the Pendency of ECIR no. 12/STF/2019: The Petitioner argued that the rejection of its bids based on the pending ECIR was arbitrary and discriminatory. The Petitioner highlighted that there were no substantive charges against it and that the pendency of the ED proceedings would unfairly prejudice its business prospects. However, the Court observed that the tenders in question were for critical defense technologies and systems, and the Impugned Condition requiring no ongoing enquiries by agencies like the CBI or ED was crucial to maintain the integrity of such projects. The Court found no infirmity in the Respondents' decision to reject the Petitioner's bids based on the pending ECIR. 2. Legality of Clause 7.2.19 of the DRDO Procurement Manual, 2020: The Petitioner challenged Clause 7.2.19 of the DRDO Procurement Manual, which required an undertaking that no enquiry was ongoing by any government agency. The Court referred to multiple precedents emphasizing the limited scope of judicial review in tender matters, especially those involving national security. It concluded that the Impugned Condition was not arbitrary, illegal, or violative of Articles 14, 19(1)(g), and 21 of the Constitution of India. The Court upheld the legality of Clause 7.2.19, considering the sensitive nature of the projects undertaken by the DRDO. 3. Impact of Pending Enquiries Against Directors on the Company's Eligibility: The Petitioner contended that enquiries against individual Directors should not impede the company's eligibility for tenders. The Court noted that the Petitioner Company was a sister concern of ADPL, with the same Directors involved in both entities. It was also observed that the Petitioner had allegedly benefitted from the proceeds of crime generated by ADPL. Given these facts, the Court found no merit in the argument that pending enquiries against the Directors should not affect the company's eligibility. 4. Effect of Amalgamation on the Successor Company's Eligibility for Tenders: The Petitioner argued that liabilities, including criminal liabilities, should not transfer to the successor company post-amalgamation. The Court, however, noted that the Petitioner Company had taken over the assets of ADPL and was allegedly involved in the same fraudulent activities. The Court emphasized that the nature of work and the key managerial personnel remained the same post-amalgamation. Therefore, the Court rejected the argument that the amalgamation should shield the Petitioner from the consequences of ADPL's actions. 5. Judicial Review of Tender Conditions and Decisions: The Court reiterated the principles of judicial restraint in administrative actions related to tenders, especially those involving national security. Citing various precedents, the Court emphasized that the Government must have the freedom to set tender conditions to ensure fairness and integrity. The Court found that the Impugned Condition was neither arbitrary nor discriminatory and was essential to maintain high standards of integrity in defense procurement. The Court concluded that there was no basis for judicial interference in the tender conditions or the decision to reject the Petitioner's bids. Conclusion: The Court dismissed the petition, upholding the validity of the Impugned Condition in the DRDO Procurement Manual and the Respondents' decision to reject the Petitioner's bids due to the pending ECIR. The Court emphasized the limited scope of judicial review in tender matters, especially those involving national security, and found no arbitrariness or discrimination in the Respondents' actions.
|
