2024 (9) TMI 1585 - HC - Indian Laws

Requirement of GST registration for a bidder in respect of the concerned NIT - Cancellation of bids of petitioner - While, as per the petitioners, such registration is not required and could not be insisted upon, the stand of the Corporation is that such registration is mandatory - HELD THAT - Law is well settled that in matters of tender, the role of the Court should be restricted and unless the impugned action is palpably unreasonable or vitiated by mala fide, interference is to be avoided as it causes delay which has cascading effect on the public interest. From the documents annexed to the petition, the registered offices of the petitioners appear to be in various locations in the State of West Bengal. It is not understood as to why all the 9 (nine) petitioners could have a particular address in the State of Assam. The address is also apparently wholly vague. This Court has noticed that even the affidavit accompanying the writ petition is not in accordance with law. The deponent claims to be the Director of the petitioner no. 1 and the authorized signatory of the petitioner s Company. However, there is no statement that the deponent has been authorized by the other petitioners. Though certain certificates have been annexed regarding such authorization, in absence of a statement in the affidavit, the same would not be sufficient. It is needles to state that in a writ petition, the affidavit is of paramount importance as there is no further scope of adducing evidence or cross-examination. Apart from the aspect of lacking in merits in the instant writ petition, the conduct of the petitioners in approaching a Court of Equity is not above board. The writ petition stands dismissed.

Issues Involved:
1. Requirement of GST registration for bidding.
2. Alleged discrimination in procurement process.
3. Fairness and transparency in the distribution of State largesse.
4. Concluded contract and authority to cancel bids.
5. Validity of the empanelment process and conditions.
6. Judicial review of tender processes.
7. Procedural irregularities in the writ petition.

Issue-wise Detailed Analysis:

1. Requirement of GST Registration for Bidding:
The primary issue is whether GST registration is mandatory for bidders under the NIT dated 07.07.2023. The petitioners argued that GST registration was not mandatory and cited Clause A(i)(v) of the NIT and various communications to support their claim. Conversely, the respondent Corporation maintained that GST registration became mandatory post-2022, as clarified in Clause 6 of the NIT. The Court scrutinized Clause 6, which explicitly states that GST registration in the concerned State is mandatory for bidding. The Court found that none of the petitioners had GST registration in Assam, thereby validating the Corporation's action to cancel the bids.

2. Alleged Discrimination in Procurement Process:
The petitioners alleged discrimination, arguing that similar procurement processes in Jharkhand did not insist on GST registration. The Corporation clarified that the Jharkhand instance was an error and not a binding precedent. The Court upheld that Article 14 of the Constitution ensures positive equality and does not support claims based on negative equality. Thus, the petitioners' claim of discrimination was dismissed.

3. Fairness and Transparency in the Distribution of State Largesse:
The petitioners emphasized the need for fairness and transparency, citing landmark cases like Ramana Dayaram Shetty and Air India Ltd. The Court acknowledged the principles but found no arbitrariness or mala fide intent in the Corporation's actions. The Court reiterated that the tendering authority is best positioned to interpret its requirements, as supported by the Supreme Court in Caretel Infotech Limited and Agmatel India Private Limited.

4. Concluded Contract and Authority to Cancel Bids:
The petitioners argued that there was a concluded contract, and the Additional General Manager lacked authority to cancel it. The Corporation countered that the acceptance of the offer was provisional, pending further verification and issuance of a Release Order. The Court agreed with the Corporation, noting that no binding contract existed without a Release Order, and the Additional General Manager's authority was valid under Clause 5 of the NIT.

5. Validity of the Empanelment Process and Conditions:
The petitioners contended that their empanelment on the M. Junction platform made GST registration non-mandatory. The Corporation clarified that empanelment on M. Junction was merely for facilitating online bidding and did not determine eligibility, which was governed by the NIT conditions. The Court upheld this interpretation, emphasizing that the tender document's terms are paramount.

6. Judicial Review of Tender Processes:
The Court cited the Supreme Court's stance in Michigan Rubber (India) Ltd. and Jagadish Mandal, emphasizing limited judicial intervention in tender matters unless actions are mala fide or arbitrary. The Court found no such issues in the Corporation's actions and stressed that judicial review should not impede public sector efficiency.

7. Procedural Irregularities in the Writ Petition:
The Court noted procedural flaws in the writ petition, including improper affidavit and court fee payment for multiple petitioners. The petitioners' identical and vague address in Assam raised further concerns. The Court highlighted the importance of adhering to procedural norms, especially in writ petitions where affidavits are crucial.

Conclusion:
The Court dismissed the writ petition, finding no merit in the petitioners' claims and emphasizing the need for compliance with tender conditions and procedural norms. The judgment underscores the principles of fairness, transparency, and limited judicial intervention in tender processes.

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