Difference between auction and tender - Indian Laws - General

Difference between Auction and Tender A number of judicial decisions have also gone into the difference between auction and tender :- (i) Auction Vs. Inviting Tenders :- Former is a way of selling property by bids usually to the highest bidder by public competition. Latter is merely an attempt to ascertain whether an offer can be obtained within adoptable margin. It is an offer to receive offers, an offer to chaffer: 1974 SC 651-6. (ii) Auction Vs. Tender : In an auction, a number of persons attempt to outbid each other; in any system of tenders, though the spirit of outbidding by closed offer is inherent, yet one cannot complete for the 2nd and 3rd time. Moreover, when tender is given, the tenderer gives the bid in documents without knowing the offer or bid of the other tenderer: Kalyan Singh Vs. DAH 1981 NOC 24 Raj. The Tribunal in M/s. The Salem Starch Sago Manufacturers Service Industrial Co-operative Society Ltd. Vs. CCE ST - 2018 (3) TMI 192 - CESTAT CHENNAI The Hon ble Supreme Court in the case of Puxomoma Ramanata Quenin Vs. Makan Kalyan Tandel and Ors. - 1974 (1) TMI 112 - SUPREME COURT, has also brought forth the distinction between auction and tender as follows:- .......... ... An auction , as stated in Halsbury s Laws of England , Third Edition, Vol. 2, page 69, is a manner of selling or letting property by bids and usually to the highest bidder by public competition. An invitation to tender is a mere attempt to ascertain whether an offer can be obtained within such margin as the building owner or employer is willing to adopt, or, in other words, is an offer to negotiate, an offer to receive offers, an offer to chaffer. There is in our opinion, difference between auction and invitation for tenders.