Supreme Court of India
RATNAGIRI GAS & POWER PVT. LTD.versusRDS PROJECTS LTD. & ORS.
- Citation
- 2012 INSC 482
- Decided
- 18 October 2012
- Disposal
- Appeal(s) allowed
- Bench
- T S THAKUR
Holding
The Supreme Court held that the second writ petition was not maintainable as it attempted to re‑agitate the earlier annulment, that the High Court’s finding of malice was unsustainable, and remanded the matter to the High Court to decide afresh RDS’s eligibility under the original tender criteria.
Summary
The joint‑venture Ratnagiri Gas & Power Pvt. Ltd. (RGPPL) cancelled a breakwater tender after discovering that the lowest bidder, RDS Projects Ltd., did not meet the qualifying criteria of a 400‑metre offshore breakwater. RDS first withdrew a writ petition (8252/2010) with liberty to challenge its exclusion in a fresh tender, then filed a second writ petition (534/2011) contesting both the annulment and the new eligibility conditions. The Supreme Court held that the second petition was not maintainable because it sought to re‑open issues already withdrawn, and that the High Court’s finding of malice in fact or law was unsupported by specific allegations or impleadment of the officials. Consequently, the Court set aside the High Court’s order, remanded the case for a fresh determination of RDS’s eligibility under the original tender, and allowed the appeals.
Issues considered
- Whether the second writ petition (W.P. No. 534/2011) is maintainable in view of the withdrawal of the earlier petition (W.P. No. 8252/2010).
- Whether the rejection of RDS’s bid and the annulment of the tender process were vitiated by malice in fact or malice in law.
- Whether the amendment of the eligibility clause in the second tender notice unfairly excluded RDS from competition.
- Whether RDS satisfied the original eligibility requirement of having completed a single offshore breakwater of at least 400 metres.
Legislation cited
Subjects
tender cancellationeligibility criteriamalice in factmalice in lawadministrative lawwrit petitionprocurementRTI ActCAG reportcontract awardfresh tender
Judgment
[2012] 9 S.C.R. 690
A RATNAGIRI GAS & POWER PVT. LTD.
v.
RDS PROJECTS LTD. & ORS.
(Civil Appeal No. 7593 o( 2012)
OCTOBER 18, 2012
B
rr.s. THAKUR AND GYAN SUDHA MISRA, JJ.)
CONSTITUTION OF /NOIA, 1950:
c Art. 226 - Second writ petition - Maintainability -
Breakwater contract - Successful bidder (respondent)
subsequently found ineligible as it did not meet the basic
qualifying conditions of offshore breakwater - Fresh tenders
invited - Writ petition by respondent challenging annulment
of tender process and rejection of its bid - Dismissed as not
0
pressed, with liberty to seek redress if respondent was
excluded from consideration in fresh tender - Second writ
petition involving the same issues as in earlier writ petition,
as also challenging the fresh tender notice - Allowed by High
E Court - Held: Liberty granted to file a fresh petition was limited
to any such fresh challenge being laid by the respondent to
its exclusion in terms of any fresh tender notice - The order
passed by the High Court did not permit the respondent to
re-open and re-agitate issues regarding rejection of its bid
pursuant to the earlier tender notice and the annulment of the
F entire tender process, even if the second tender notice sought
to disqualify it from competition by altering the conditions of
eligibility to its disadvantage - To that extent, the subsequent
writ petition was not maintainable - There is no finding by the
High Court on the eligibility of the respondent - The question
G regarding eligibility of respondent cannot be resolved in the
absence of any conclusive evidence, and in the absence of
a specific finding from the High Court, on the question - Matter
remanded to High Court for decision afresh in accordance
H 690
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 691
PROJECTS LTD. & ORS.
with the directions given in the judgment - Contract - A
Administrative Law - Malice in law and malice in fact.
ADMIN/STRA TIVE LAW:
Malice in fact - Administrative action - Findings recorded
by High Court as regards malafides - Held: The law casts a
8
heavy burden on the person alleging ma/a tides to prove the
same on the basis of facts that are either admitted or
satisfactorily established and/or logical inferences deducible
from the same - This is particularly so when the petitioner
alleges malice in fact in which event it is obligatory for the C
person making any such a/legation to furnish particulars that
would prove ma/a tides on the part of the decision maker -
Vague and general allegations unsupported by requisite
particulars do not provide a sound basis for the court to
conduct an inquiry into their veracity - Further, as and when D
allegations of ma/a tides are made, the persons against whom
the same are levelled need to be imp/eaded as parties to the
proceedings to enable them to answer the charge - In the case
at hand, there was no a/legation of "malice in fact" against any
individual, nor was any individual accused of bias, spite or E
ulterior motive, impleaded as a party to the writ petition - High
Court named the officers concerned and concluded that the
integrity of the entire process was suspect, which was wholly
unjustified in the circumstances of the case.
F
Malice in law - Held: If on an interpretation of a clause in
the tender notice by the legal department concerned, the
officers review their decision or reverse the recommendations
· made earlier, the same does not tantamount to malice in law
so as to affect the purity of the entire process or render it
suspect even assuming that the opinion is on a more G
thorough and seasoned consideration found to be wrong -
Nothing in the instant case was done without a reasonable or
probable cause which is the very essence of the doctrine of
malice in law vitiating administrative actions.
H
692 SUPREME COURT REPORTS [2012] 9 S.C.R.
A The appellant, a joint venture company of Gas
Authority of India Ltd. (GAIL) and National Thermal Power
Corporation (NTPC), was entrusted the project of
completing the balance work at LNG Terminal of Dabhol
Power Project and of commissioning and operating the
B same. The appellant engaged GAIL, as its engineer and
the latter appointed Engineers India Ltd. (EIL) as their
Project Management Consultant. EIL, in terms of
international competitive bidding notice dated 26.6.2009
invited tenders for completion of "Breakwater" at LNG
c Terminal which had been left incomplete by a previous
contractor. The price bid of the respondent (RDS) having
been found to be lowest, it was recommended by GAIL,
with certain reservations, to the appellant for award of the
contract. Meanwhile one of the bidders, namely 'HRB'
filed a writ petition before the High Court contending that
0
'RDS' did not satisfy the qualified criteria and the writ
petitioner had been wrongly disqualified. CAG also
forwarded to the appellant a report containing adverse
observations regarding the completion of break-water in
Andaman and Nicobar project. Certain documents under
E RTI Act regarding Andaman Project were also received.
On the basis of the documents so received, EIL re-
examined the matter and submitted its observations by
letter dated 18.9.2010 stating that 'RDS' did not meet the
basic qualifying conditions of offshore break-water of a
F minimum length of 400 meters. Accordingly, a resolution
was passed by the Board of Directors of the appellant-
company on 4.10.2010 whereby it decided to annul the
Breakwater tender on the ground that 'RDS' did not
qualify the BQC criteria, and opted to go for fresh tenders.
G By communication dated 6.10.2010, 'RDS' was conveyed
the reasons for rejection of its tender. Consequently, the
writ petition of 'HRB' was dismissed as not pressed, as
the tender process had been scrapped and a decision to
invite fresh tenders had been taken. Subsequently, W.P.
H No. 8252 of 2010 was filed by 'RDS' challenging the order
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 693
PROJECTS LTD. & ORS.
of annulment dated 4.10.2010 and the letter dated A
6.10.2010 rejecting its bid. However, the said writ petition
was also dismissed as withdrawn reserving liberty to
'RDS' to seek redrei:;s in accordance with law if it was
excluded from consideration in the fresh tender. 'RDS'
filed another writ petition (W.P. No. 534 of 2011), which B
was assailed by the appellant on the ·ground that the
second writ petition was not maintainable as it sought to
question the validity of the decision of the Board of
Directors of the appellant company taken on 4.10.2010
cancelling the tender process, and the consequent c
communication dated 6.10.2010. The High Court allowed
the writ petition and directed the appellant-company to
take a fresh decision on the subject.
In the instant appeal, the questions for consideration
before the Court were: (i) Whether Writ Petition No.534 of D
2011 filed by RDS challenging the rejection of its tender
and annulment of the entire· tender process was
maintainable in the light of the withdrawal of Writ Petition
No.8252 of 2010 previously filed by it?; (ii) Whether the
rejection of .the tender submitted by 'RDS' and the E
decision to annul the entire tender process was vitiated
by mala tides?; (iii)Whether the condition of eligibility
stipulated in the second tender notice issued by the
appellant unfairly excluded 'RDS' from bidding for the
allotment of the work in question? and; (iv) Whether F
'RDS' was eligible in terms of the first tender notice to
compete for the works in question having executed a
minimum breakwater length of 400 meters in a single
project required vide Clause 8.1.1.1?
Allowing the appeals, the Court G
HELD:
Question No.1:
1.1 The order dismissing W.P. 8252 of 2010 as H
694 SUPREME COURT REPORTS [2012] 9 S.C.R.
A withdrawn has two distinct features: (a) The writ petition
specially questioned the validity of the Board resolution
dated 4.10.2010 and the rejection of the bid offered by
RDS, by letter dated 6.10.2010 meaning thereby that the
same squarely related to the issues that were sought to
B be agitated in subsequently filed Writ Petition No.534 of
2011 in which too RDS had prayed for quashing of the
resolution dated 4.10.201 O and communication dated
6.10.2010 rejecting the bid offered by it. There is, thus,
almost complete identity of the subject matter and the
c issues raised in the two writ petitions and the grounds
urged in support of the same; and (b) The challenge to
the Board resolution dated 4.10.2010 and communication
dated 6.10.2010 was withdrawn in toto, with liberty
reserved to RDS to file a fresh petition for redress only
in case the fresh tender to be floated by the appellant for
0
allotment of the works in any manner sought to exclude
it from participating in the same. This necessarily implies
that if RDS was allowed to participate in the fresh tender
process it would have had no quarrel with the annulment
of the entire ten<ter process based on the first tender
E notice. Conversely, if the fresh tender notice sought to
_disqualify RDS from bidding for the works, it could seek
redress ag"inst such exclusion. Thus, the liberty granted
by the High Court to file a fresh petition was limited to
any such fresh challenge being laid by RDS to its
F exclusion in terms of any fresh tender notice. The order
passed by the High Court did not permit RDS to re-open
and re-agitate issues regarding rejection of its bid
pursuant to the earlier tender notice and the annulment
of the entire tender process, even if the second tender
G notice sought to disqualify it from competition by altering
the conditions of eligibility to its disadvantage. [Para 22)
[711-C-H; 712-A-B)
1.2 In subsequent Writ Petition No.534 of 2011 filed
H by RDS not only were the amended conditions of the
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 695
PROJECTS LTD. & ORS.
tender notice assailed but the validity of the resolution A
dated 4.10.2010 and letter dated 6.10.2010 was also
sought to be re-opened no matter the same was already
concluded with the withdrawal of Writ Petition No.8252
of 2010. RDS sought to use the liberty to challenge the
amended terms of eligibility to re-open what it could and B
indeed ought to have taken to a logical conclusion in Writ
Petition No.8252 of 2010. Besides, the withdrawal of the
earlier writ petition was a clear acknowledgment of the
fact that the grievance made by RDS regarding the
rejection of its bid had been rendered infructuous as the c
works in question remained available for allotment in a
fresh tender process with everyone otherwise eligible to
compete for the same being at liberty to do so. Inasmuch
as and to the extent Writ Petition No.534 of 2011 filed by
RDS challenged the rejection of the tender and the D
annulment process in a second round despite withdrawal
of the earlier writ petition filed for the same relief, it was
not maintainable. The scope of Writ Petition no.534 of
2011 was and had to be limited to the validity of the
amendment in the conditions of eligibility introduced by E
the appellant in the second tender notice issued by it.
[Para 22] [712-B-G] ,
Question No. 2
2.1 Since Writ Petition No. 534 of 2011 could not have F
re-agitated issues touching the validity of annulment of
the tender process, there was no occasion for the High
Court to go into the question whether or not the decision
to refer to the bid and annul the process was vitiated by
malice in law or fact. The findings recorded by the High G
Court on the question of mala tides are, therefore, liable
to be set aside on that ground alone. tPara 23] [713-A-B]
2.2 Even otherwise, the findings recorded by the High
Court on the question of mala fides do not appear to be
factually or legally sustainable. The law casts a heavy H
696 SUPREME COURT REPORTS [2012] 9 S.C.R.
A burden on the person alleging mala tides to prove the
same on the basis of facts that are either admitted or
satisfactorily established and/or logical inferences
deducible from the same. This is particularly so when the
petitioner alleges malice in fact in which event it is
B obligatory for the person making any such allegation to
furnish particulars that .would prove mala tides on the
part of the decision maker. Vague and general allegations
unsupported by the requisite particulars do not provide
a sound basis for the court to conduct an inquiry into
c their veracity. [Para 24] [713-C-E]
State of Bihar v. P.P. Sharma 1991 ( 2) SCR 1 =1992
Supp. (1) SCC 222; Ajit Kumar Nag v. General Manager (PJ),
Indian Oil Corpn. ·Ltd., Haldia and Ors. 2005 (3 ) Suppl. SCR
314 = (2005) 7 sec 764 - referred to
D
2.3 Further, as and when allegations of mala fides are
made, the persons against whom the same are levelled
need to be impleaded as parties to the proceedings to
enable them to answer the charge. In the case at hand,
E there was no allegation of "malice in fact" against any
individual nor was any individual accused of bias, spite
or ulterior motive impleaded as a party to the writ petition.
What was stated to have been alleged was malice in law.
But the High Court had in the absence of any assertion
F in the writ petition and in the absence of the officers
concerned recorded a finding suggesting that the officers
had acted mala fide. The High Court named the officers
concerned and concluded that the integrity of the entire
process was suspect, which was wholly unjustified in
G the circumstances of the case. [Para 26 and 29] [715-B;
717-E, G-H; 718-A]
State of M.P. and Ors. v. Nandlal Jaiswal and Ors. 1987
(1) SCR 1 (1986) 4 SCC 566; Smt. Swaran Lata v. Union of
India & Ors. (1979) 3 SCC 165; Nirmal Jeet Singh Hoon v.
H /rtiza Hussain & Ors. 2010 (14 ) SCR 109 = (2010) 14 ~cc
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 697
PROJECTS LTD. & ORS.
564 and A// India State Bank Officers' Federation v. Union of A
=
India 1996 ( 6) Suppl. SCR 255 (1997) 9 SCC 151- relied
on.
2.4 In cases involving malice in law, the
administrative action is unsupportable on the touchstone 8
of an acknowledged or acceptable principle and can be
avoided even when the decision maker may have had no
real or actual malice at work in his mind. In the case at
hand, the final decision to reject the tender submitted by
RDS was taken by the appellant in its capacity as the C
owner of the project. GAIL and Ell performed only an
advisory role whose opinions were recommendatory and
meant to assist the owner to take a final call. From the
correspondence exchanged between the appellant and
GAIL and Ell, it i.s evident that the appellant had from the D
date of receipt of the recommendations made to it by Ell
and GAIL till the end maintained a consistent stand and
expressed reservations about the capacity of RDS to
undertake the work. In the earlier Writ Petition No. 8252
of 2010, the appellant had no doubt filed a short affidavit
supporting its decision holding RDS eligible but in view E
of the discovery of material in proceedings under the RTI
Act and an adverse CAG report, the appellant, as owner
of the project·tlfat was being executed at a colossal cost
running into hundreds of crores of rupees, was perfectly
justified in adopting a careful approach to ensure that F
those found eligible by its technical experts and
consultants were indeed so qualified and possessed the
necessary wherewithal, experience and expertise to
execute the project. It was also well within its right to
demand documentary proof from RDS to support its G
claim. In the course of the hearing before this Court, the
records produced on behalf of ROS did not show that it
had indeed executed the breakwater Project of 400
meters length in Car Nicobar. More importantly, there is
nothing to disclose the basis on which the certificates, H
698 SUPREl\4E COURT REPORTS [2012) 9 S.C.R.
A which RDS had produced to prove its eligibility, were
issued by the engineers concerned. The files that were
produced did not bear any testimony to issuing of any
such certificates or the basis on which the same were
issued. There .was, therefore, no justification for either
B RDS or the High Court to raise an accusing finger against
the appellant simply because it had demanded proof
regarding the claim of eligibility from RDS or collected
relevant information under RTI Act and referred the
material so collected to GAIL and Ell for evaluation and
c opinion. The final decision to scrap the project being
within appellant's powers under the terms of the tender
notice, invocation of that power was not in the facts and
circumstances vulnerable to challenge on the ground of
malice in fact or law, on the grounds set out by the High
Court even assuming that Writ Petition No.534/2011 was
0
maintainable notwithstanding the withdrawal of Writ
Petition No. 8252 of 2010. [Para 30 and 33) [718-C-D; 720-
D-H; 721-A-E; 722-A-C]
Shearer v. Shields (1914) A.C. 808; Additional District
E Magistrate, Jabalpur v. Shivkant Shukla 1976 Suppl. SCR
=
172 (1976) 2 SCC 521; State of AP & Ors. v. Goverdhanlal
=
Pitti 2003 (2) SCR 908 (2003) 4 SCC 739; Ravi Yashwarit
Bhoir v. District Collector, Raigad and Ors (2012) 2 SCC 407
- referred to
F
2.5. Besides, the High Court erred In recording its
finding on mala fides on the sole basis that Ell had
reviewed its earlier opinion regarding eligibility of RDS.
If on an interpretation of a clause in the tender notice by
G the legal department concerned, the officers review their
decision or reverse the recommendations made earlier,
the same does not tantamount to malice in law so as to
affect the purity of the entire process or render it suspect
even assuming that the opinion is on a more thorough
and seasoned consideration found to be wrong. In the
H
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 699
PROJECTS LTD. & ORS.
absence of any other circumstances suggesting that the A
process was indeed vitiated by consideration of any
inadmissible material or non-consideration of material
that was admissible or misdirection on issues of vital
importance, fresh recommendations made in tune with
the legal opinion could not be held to have been vitiated B
by malice in law. Nothing in the instant case was done
without a reasonable or probable cause which is the very
essence of the doctrine of malice in law vitiating
administrative actions. [Para 35] [723-E, G-H; 724-A-B-E-
~ c
2.6. Therefore, the findings recorded by the High
Court to the effect that the process of annulment of the
tender process or the rejection of the tender submitted
by RDS was vitiated by mala tides is unsustainable and
is set aside. [Para 35] [724-F-H] D
Question No.3:
3.1. A statement has been made on behalf of the
appellant that in order to show its bona tides and to prove E
that it had no intention to deliberately target or exclude
RDS, Clause 8.1.1.1 of the second tender notice shall not
be enforced and the corresponding clause as it appeared
in the first tender notice shall govern matters stipulated
therein. [Para 39] [726-E-H; 727-A]
F
Air India Ltd. v. Cochin lntemational Airport Ltd. and Ors.
2000 (1) SCR 505 = (2000) 2 sec 617 - cited
Question No.4:
4.1. It is true that RDS cannot be excluded from G
competition based on Clause 8.1.1.1 in the second tender
notice. But that does not automatically make RDS eligible
for allotment of the works even under the first tender
notice. The appellant's case is that RDS was techno
H
700 SUPREME COURT REPORTS [2012] 9 S.C.R.
A commercially ineligible for allotment, and in its
communication dated 6.10.2010, it had given the reasons
for that view. A careful reading of the communication
dated 06.10.2010 would show that the rejection of the bid
offered by RDS was based on three distinct grounds
B namely: (i) RDS had claimed the qualifying project to
have been awarded in its favour in November, 2000. The
length of the project so allotted was 290 meters only as
against 400 meters required under the BQC; (ii) The
breakwater at Mus (chainage 22m to 200m and 200
c meters to 330/490 meters) were awarded and executed as
two separate Projects, whereas Clause 8.1.1.1 required
that the single bidder should have executed the required
length of Breakwater in a Single Project; (iii) The award
of the above project was made on EHL or Mis Reacon
0 International, for different phases and RDS was not
responsible for the execution of the total scope of the
work in any one of the two projects. [Para 40 and 42) [727-
D-E; 728-F-H; 729-A-B]
4.2. On the question whether the Breakwater
E constructed at Mus in Car Nicobar comprised one or two
projects, a fair and unqualified concession has been
made on behalf of the appellant that for purposes of
determining the eligibility. of RDS the breakwater at Mus
Car Nicobar could be treated as a single project. With that
F concession, what remains to be determined is whether
RDS had limited its claim to eligibility only on the award
made in its favour in November, 2000. If so, whether it is
debarred or stopped from claiming that it had executed
the project from chainage 22 meters to 200 meters also.
G More importantly, whether RDS had actually executed the
Breakwater Project at Mus Car Nicobar with a length of
400 meters. However, there is no finding on these
questions in the impugned judgment. The question
regarding eligibility of RDS cannot be resolved in the
H absence of any conclusive evidence, and in the absence
RATNAGIRI· GAS & POWER PVT. LTD. v. RDS 701
PROJECTS LTD. & ORS.
A remand to the High Court, therefore, became inevitable A
which part was conceded on behalf of both the parties.
[Para 45, 48] [729-H; 730-A-B; 731-F-G]
5. The judgment and order passed by the High Court
is set aside and the matter is remanded back for decision B
in accordance with the directions contained in the instant
judgment. [para 49] [731-H; 732-A]
Case Law Reference:
1991 (2) SCR ~ referred to Para 24 c
2005 (3) Suppl. SCR 314 referred to Para 25
1987 (1) SCR 1 relied on Para 26
(1979) 3 sec 165 relied on Para 27
D
2010 (14) SCR 109 relied on Para 28
1996 (6) Suppl. SCR 255 relied on Para 28
(1914) A.C. 808; referred to Para 30
1976(0) Suppl. SCR 1J2 referred to Para 30 E
2003 (2) SCR 908 referred to Para 31
(2012) 2 sec 407 referred to Para 32
2000 (1) SCR 505 cited Para 38 F
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
7593 of 2012.
From the Judgment & Order dated 17.10.2011 of the High
Court of Delhi at New Delhi in Writ Petition (Civil) No. 534 of G
2011.
WITH
C. A. No. 7594 and 7595 of 2012
H
702 SUPREME COURT REPORTS [2012] 9 S.C.R.
A R.F. Nariman, SG, Indira Jaisingh, Sidharth Luthra, ASG's,
Sudhir Chandra, Jagdeep Dhankar, Bindu Saxena, Shailendra
Swarup, Aparjita Swarup, K.K. Patra, Neha Khattar, Kanika
Singh, Ashok Mathur, Ajit Pudussery, Joanne Pudussery, K.
Vijayan, Dinesh Khurana, Asha Jain Madan, Bhagbati Prasad,
B R.K. Rathore, Kavin Gulati, Gargi Khanna, Devina Saghal, S.
Sinha for the Appearing Parties.
The Judgment of the Court was delivered by
T.S. THAKUR, J. 1. Leave granted.
c
2. These appeals arise out of a common judgment and
order dated 17th October, 2011 passed by the High Court of
Delhi whereby Writ Petition (C) No.534 of 2011 filed by the
respondent has been allowed and the rejection of the tender
D submitted by it quashed with a mandamus to the appellant-
company to take a fresh decision on the subject in the light of
the observations made by the High Court.
3. The factual matrix leading to the filing of the writ petition
by RDS Project Ltd. (hereinafter referred to as 'RDS' for short)
E has been set out at considerable length in the order passed
by the High Court. We do not, therefore, consider it necessary
to re-count the same all over again except to the extent the
same is absolutely necessary for the disposal of these appeals.
Suffice it to say that Government of India has entrusted the task
F of reviving and restructuring of the Dabhol Project to Gas
Authority of India Ltd. (GAIL) and National Thermal Power
Corporation ('NTPC' for short) both Government of India
undertakings who have in turn formed a joint venture company
in the name and style of Ratnagiri Gas & Power Pvt. Ltd., the
G appellant in this appeal, for short referred to as 'RGPPL'. The
appellant-RGPPL is charged with the duty of completing the
balance work at LNG Terminal of the Dabhol Power project and
of commissioning and operating the same. The appellant has,
for that purpose, engaged GAIL as its Engineer who has in turn
H appointed Engineers India Limited (Ell) as their Primary
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 703
PROJECTS LTD. & ORS. [T.S: THAKUR, J.]
Project Management Consultant. Scott Wilson a U.K. based A
entity was also kept in the loop as a backup consultant for
marine works.
4. In terms of an international competitive bidding notice,
issued by it on 26th June, 2009, Ell invited tenders from B
eligible parties for completion of, what is called "Breakwater''
at LNG Terminal at RGPPL site, Dabhol, Maharashtra. The
construction of the breakwater was left incomplete by a
previously employed contractor appointed for the purpose on
account of the stoppage of the work by the Dabhol Power C
Company. The earlier contractor had, according to the
appellant, constructed only 500 meters of breakwater length
leaving the balance of nearly 1800 meters incomplete and a
certain length thereof untouched.
5. Apart from stipulating other terms and conditions, D
Clause 8.1.1.1 of the tender required that Single Bidders
responding to the invitation should have experience of
successfully completing as a single bidder or "as a lead of a
Consortium/Joint Venture", at least one project of a breakwater
in an offshore location with a minimum length of 400 meters. E
Clause 8.1.1.1 of the Tender document was in the following
words:
"The bidder shall have experience of having successfully
completed,· as a single bidder or as a lead of a
F
Consortium/Joint Venture, at least one project of a
breakwater in an offshore location (as defined at Clause
No.8.1.2.5 below) of minimum length of 400m during the
last 20 (twenty) years to be reckoned from the last date of
submission of bids. The scope of work of the proposed
qualifying project work should comprise of the design, G
engineering, project management and construction of the
breakwater."
6. In response to the notice inviting tenders, Ell received
five tenders from five different entities viz. RDS the respondent H
704 SUPREME COURT REPORTS [2012] 9 S.C.R.
A in this appeal, M/s ESSAR Construction Ltd., M/s Afcons
Infrastructure Ltd., joint venture of M/s Higgard Punj Lloyd Ltd.
and joint venture of M/s Hung-Hua/Ranjit Buildcon Ltd.
7. With the tender submitted by it RDS enclosed the
requisite documents such as Form-B in which details of specific
8
work experience, on the basis whereof it claimed to be
satisfying the Bid Qualification Criteria ('BQC' for short), were
also given. It also. enclosed along with its tender, completion
certificate dated 5th April, 2008 issued by Deputy Chief
Engineer-IV, Andaman Harbour Works under the Ministry of
C Shipping, Road Tran~port and Highway, Government of India
certifying that RDS had completed breakwater of 500 meters
against a tender dated 26th May, 1999. Completion certificate
dated 30th June, 2003 issued by the Senior Executive Manager
of Ellen Hinengo Ltd. a Tribal Society (EHL) and letter dated
D 10th November, 2000 addressed by the said Ellen Hinengo
Ltd. to RDS asking it to commence work for construction of
breakwater at Mus in Car Nicobar Island pursuant to tender
dated 3rd November, 2000 were also produced by RDS apart
from a certificate issued by EHL about the offshore location of
E the breakwater.
8. Tenders received from different parties were techno
commercially evaluated by Ell all of whom were found to be
technically qualified except Hung-Hua & Ranjit Buildcon Ltd.
F who went out of the reckoning at that stage itself. Names of only
four bidders found techno commercially eligible were
recommended by Ell for the approval of GAIL the owner's
engineer. The price bids of the four bidders were pursuant to
the said recommendation opened on 11th February, 2010 in
G which RDS was found to be the lowest bidder having quoted a
price of Rs.390 crores only, which was less than the estimated
cost of the project by Rs.160 crores. GAIL accordingly
recommended RDS to the appellant-company for award of the
contract. Recommendation received from GAIL notwithstanding
H the appellant-company appears .to have expressed
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 705
PROJECTS LTD. & ORS. [T.S. THAKUR, J.]
apprehensions about the capability of RDS to complete the A
project in time having regard to the fact that RDS had taken
three years to complete a breakwater with a length of mere 500
meters whereas the appella,nt-company's breakwater project
stretched over a length of 1800 meters and had to be
completed within a period of 33 months only. Reservations B
about the viability of the rates quoted by RDS which were found
to be abnormally low were also expressed.
9. While a final decision regarding award of the contract
had yet to be taken, Hung-Hua/Ranjit Buildcon Ltd. who was C
one of the bidders and whose bid was not found to be techno-
commercially qualified, filed a writ petition in the Delhi High
Court, inter alia, alleging that while they had been wrongly
disqualified, RDS who did not satisfy the qualifying criteria had
been wrongly held to be qualified. Questions regarding validity
of certificates submitted by RDS were also raised in the writ D
petition.
10. In response to the above writ petition filed by Hung-
Hua, the appellant company filed a short affidavit in which it
disputed t~e averments made in the writ petition and took the E
stand that the documents filed by RDS along with its bid showed
that breakwater at Mus in Car Nicobar Island was built at an
offshore location and that RDS had completed the entire work
as a single entity on behalf of Mis Ellen Hinengo Ltd.
F
11. While the writ petition filed by Hung-Hua was pending
before the High Court, the appellant sought from GAIL the work
order issued to RDS in respect of the qualifying project at Car
Nicobar to verify the credentials of the RDS. RDS was
accordingly asked by Ell to produce the documents in support
of its qualification such as the work order for the Andaman G
Harbour works. The appellant-company also sought the details
about the contracts to verify the correctness of the certificates
submitted by RDS along with its bid in response to the tender
notice.
H
706 SUPREME COURT REPORTS [2012] 9 S.C.R.
A 12. A further development in the meantime took place in
the form of the CAG forwarding a report in which certain
adverse observations regarding the completion of the
breakwater at chainage 22M to chainage 200 M in the
Andaman and Nicobar Project were made. The report revealed
B that in January, 1998 the contractor had completed only 15 to
47 percent of the work and that in April, 19_98 the Executive
Engineer had taken out a part of the unexecuted work for
awarding it to another contractor. The CAG found that due to
delay in the construction of a portion of the breakwater coupled
c with non-compliance of contractual terms, the department had
suffered a loss of Rs.2.61 crores, apart from increase in cost
of the work by Rs.3.55 crores.
13. The report of the CAG was forwarded by the appellant
to GAIL with the request to arrange copies of work order, and
D satisfactory evidence of the credentials of RDS. GAIL was also
informed that in the absence of satisfactory evidence furnished
by RDS, the appellant was not in a position to place the matter
for award of contract before the Board of Directors.
E 14. While correspondence between RGPPL, GAIL and Ell
was being exchanged on the subject the appellant received
certain documents under RTI Act including the work order
placed by Andaman H.arbour Works on EHL and those placed
on Mis Recon International for a part of the Andaman Project
F for chainage 22-200 meters. These documents were quickly
sent to Ell for review who examined the matter again and
submitted its observations in terms of letter dated 18th
September, 2010 stating that RDS did not meet the basic
qualifying conditions of offshore breakwater of a minimum
G length of 400 meters. GAIL then forwarded that opinion to the
appellant to take appropriate action on the subject.
15. On receipt of the letters aforementioned, the appellant
requested GAIL to forward its own recommendations. GAIL,
however, reiterated that since all the relevant information on the
H subject was available with the appellant, it could take an
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 707
PROJECTS LTD. & ORS. [T.S. THAKUR, J.]
appropriate decision in the matter in its capacity as the owner A
of the project.
16. A resolution was accordingly passed by the Board of
Directors of the appellant company on 4th October, 2010,
whereby it decided to annul the Breakwater tender in exercise B
of its power under Clause 28.1 of the Bidding Document on
the ground that RDS did not qualify the BQC criteria which fact
had, according to the appellant, come to light only after the
opening of the price bids. From the minutes of the meeting of
the Board of Directors it is further evident that the Board had C
taken note of the eve guidelines and declined to award the
contract to the next lowest tenderer in view of the huge price
difference between L1 & L2 and opted to go for fresh tenders.
By a separate communication dated 6th October, 2010 the
appellant-company conveyed to RDS the reasons for rejection
of its tender. D
17. With the annulment of the entire tender process Writ
Petition No.2142 of 2010 filed by Hung-Hua/Ranjit Buildcon Ltd.
inter alia challenging the acceptance of the technical bid
submitted by RDS was dismissed as withdrawn by the High E
Court in terms of order dated 30th November, 2010. That order
came to be passed on an application filed by the appellant-
RGPPL stating that the entire tender process having been
scrapped with a decision to invite fresh tenders Writ Petition
No.2142 of 2010 did not survive for consideration. The High F
Court took note of the subsequent events and dismissed the
writ petition as not pressed in view of the fact that the tender
process had been scrapped and a decision to invite fresh
tenders had been taken.
18. In Writ Petition (C) No.8252 of 2010 which was filed G
by RDS to challenge the annulment of the tender process and
the rejection of its techno commercial bid as non-responsive a
similar order was made by which the writ petition was
dismissed as withdrawn reserving liberty to the respondent-
RDS to take recourse to seek redress in accordance with law H
708 SUPREME COURT REPORTS [2012] 9 S.C.R.
A if it was excluded from consideration in the fresh tender which
RGPPL had decided to issue. We shall presently refer to the
writ petition and the effect of its withdrawal in greater detail.
Suffice it to say that the maintainability of Writ Petition No.534
of 2011 filed by RDS out of which the appeal arises was
B assailed by the appellant herein on the ground that the earlier
petition filed by it having been withdrawn the second petition
filed by RDS was not according to the appellant maintainable
insofar as the same sought to question the validity of the
decision taken by the Board of Directors on 4th October, 2010
C cancelling the tender process and the communication of the
said decision with reasons for rejection of the bid submitted
by RDS on 6th October, 2010. The High Court has in the
judgment under appeal rejected that contention and not only
held that the writ petition filed by RDS was maintainable but
D also that the decision to reject the tender submitted by it was
not legally valid nor was the annulment of the entire tender
process. The High Court found that the action taken by the
appellant on both counts was vitiated by mala tides especially
when the fresh tender notice issued by the appellant made an
attempt to exclude RDS from competing for the works in
E question.
19. We have heard learned counsel for the parties at
considerable length. The following questions, in our opinion, fall
for our determination:
F
(1) Whether Writ Petition No.534 of 2011 filed by RDS
challenging the rejection of its tender and annulment of the
entire tender process was maintainable in the light of the
withdrawal of writ petition No.8252 of 2010 previously filed
by it?
G
(2) Whether the rejection of the tender submitted by RDS
and the decision to annul the entire tender process was
vitiated by mala tides?
H (3) Whether the condition of eligibility stipulated in the
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 709
PROJECTS LTD. & ORS. [T.S. THAKUR, J.]
second tender notice issued by the appellant-RGPPL A
unfairly excluded the appellant from bidding for the
allotment of the work in question? and;
(4) Whether respondent-RDS was eligible in terms of the
first tender notice to compete for the works in question B
having executed a minimum breakwater length of 400
meters in a single project required vide Clause 8.1.1.1.
We propose to deal with the questions ad-seriatim.
In Re: Question No.1 c
20. Writ Petition (C) No.8252 of 2010 questioned the
validity of the appellant-Board's decision dated 4th October,
2010 reg~rding rejection of the bid submitted by RDS in terms
of the former's letter dated 6th October, 201 O as also the
annulment of the entire tender process for the completion of the D
"Breakwater" at LNG Terminal at RGPPL site, Dabhol,
Maharashtra. It also prayed for a mandamus directing the
appellant to formalise the award of contract for the Dabhol
project to RDS. For the sake of clarity it is useful to extract the
prayer made by RDS in the said writ petition: E
"In the premises mentioned above it is most respectfully
prayed that this Hon'ble Court be pleased to:-
(A) Issue an appropriate writ, order or direction,
F
quashing the action of the Respondents, and in
particular the decision dated 4.10.2010 of the
Respondent No.1, as communicated to the
Petitioner vide letter dated 6.10.2010 whereby bid
of the Petitioner has been rejected and the entire G
bidding process for the completion of the
breakwater of LNG Terminal of Dabhol Power
Project, Maharashtra, has been annulled; and
(B) Issue a Writ of Mandamus or any other appropriate
writ, order or direction, directing the Respondent H
710 SUPREME COURT REPORTS [2012] 9 S.C.R.
A No.1 to formalise the awarding of the contract for
the DABHOL PROJECT to the Petitioner; and
(C) Issue any other appropriate writ, order or direction,
as this Hon'ble Court may deem fit and proper in
the facts and circumstances of the case."
B
21. When the above petition came up before the High
Court on the 14th December, 2010 learned counsel for RDS
withdrew the writ petition and the accompanying application
reserving liberty to seek redress in case the tender which is
C floated sought to exclude RDS in any manner from competing
for the allotment of the work in question. Since the answer to
question No.1 above depends on the interpretation of the said
order we may extract the same in extenso:
D "Learned senior counsel for the petitioner submits
that though the tender process has been scrapped on
4.10.2010, the same was followed up by a letter dated
6.10.2010 of the respondents setting out the reasons why
the petitioner was held not to meet the BQC requirements
of having completed at least one project of breakwater in
E
an offshore location of a minimum length of 400 mtrs; which
was a stipulation in the contract. Learned senior cqunsel
for the petitioner has serious objection to the contents of
this letter and thus submits that the objection was only to
somehow ensure that the petitioner does not get the
F contract because the petitioner had made the technical
qualifications and thereafter the price bid was opened in
which the petitioner was L-1.
The learned counsel for respondents No.1, on the
G other hand, disputes the aforesaid and submits that on
analysis of the matter it was deemed proper to scrap the
tender process itself exercising the rights of an owner
under article 28.1 of the terms & conditions of the tender.
In view of the aforesaid, taking into consideration the
H
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 711
PROJECTS LTD. & ORS. [T.S. THAKUR, J.]
fact that the tender process now stands scrapped, learned A
counsel for the petitioner fairly states that he would like to
withdraw the writ petition and the application at this stage
but that in case the tender which is floated seeks to exclude
the petitioner, in any manner, so as to prevent the
participation in the tender, the petitioner should have leave B
and liberty to take recourse to legal remedy in accordance
with law. Liberty granted.
Dismissed as withdrawn."
22. Two distinct features of the above order may be C
noticed immediately. These are (a) The writ petition specially
questioned the validity of the Board resolution dated 4th
October, 201 El and the rejection of the bid offered by RDS, by
letter dated 6th October, 2010 meaning thereby that the same
squarely related to the issues that were sought to be agitated D
in the subsequently filed writ petition No.534 of 2011 in which_
too RDS had prayed for quashing of the resolution dated 4th
October, 2010 and communication dated 6th October, 2010
rejecting the bid offered by RDS. There is thus almost complete
identity of the subject matter and the issues raised in the two E
writ petitions and the grounds urged in support of the same,
and (b) The challenge to the Board resolution dated 4th
October, 2010 and communication dated 6th October, 2010
was withdrawn in toto, with liberty reserved to RDS to file a
fresh petition for redress only in case the fresh tender to be F
floated by the appellant for allotment of the works in any manner
sought to exclude RDS from participation in the same. This
necessarily implies that if RDS was allowed to participate in
the fresh tender process it would have had no quarrel with the
annulment of the entire tender process based on the first tender
notice. Conversely if the fresh tender notice sought to disqualify G
RDS from bidding for the works it could seek redress against
such exclusion. Liberty granted by the High Court to file a fresh
petition was in our considered opinion limited to any such fresh
challenge being laid by RDS to its exclusion in terms of any
fresh tender notice. The order passed by the High Court did H
712 SUPREME COURT REPORTS [2012] 9 S.C.R.
A not permit RDS to re-open and re-agitate issues regarding
rejection of its bid pursuant to the earlier tender notice and the
annulment of the entire tender process, even if the second
tender notice sought to disqualify it from competition by altering
the conditions of eligibility to its disadvantage. In fresh Writ
B Petition No.534 of 2011 filed by RDS not only were the
amended conditions of the tender notice assailed but the
validity of the resolution dated 4th October, 201 O and letter
dated 6th October, 2010 was also sought to be re-opened no
matter the same was already concluded with the withdrawal of
c Writ Petition No.8252 .of 2010. RDS sought to use the liberty
to challenge the amended terms of eligibility to re-open what it
could and indeed ought to have taken. to a logical conclusion
in Writ Petition No.8252 of 2010. If the intention behind
withdrawal of the Writ Petition No.8252 of 2010 was to come
D back on the issues raised therein there was no need for any
such withdrawal, which could if taken to their logical conclusion
have given to RDS the relief prayed for in the latter writ petition
without even going into the question whether exclusion of RDS
in the second tender notice was legally valid. Besides, the
E withdrawal of the earlier writ petition was a clear
acknowledgment of the fact that the grievance made by RDS
regarding the rejection of its bid had been rendered infructuous
as the works in question remained available for allotment in a
fresh tender process with everyone otherwise eligible to
compete for the same being at liberty to do so. Inasmuch as
F and to the extent writ petition No.534 of 2011 filed by RDS
challenged the rejection of the tender and the annulment
process in a second round despite withdrawal of the earlier writ
petition filed for the same relief, it was not maintainable. The
scope of writ petition no.534 of 2011 was and had to be limited
G to the validity of the amendment in the conditions of eligibility
introduced by RGPPL in the second tender notice issued by it.
Question no.1 is answered accordingly.
In Re: question No.2
H 23. This question no longer survives for consideration in
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 713
PROJECTS LTD. & ORS. [T.S. THAKUR, J.]
view of what has been observed by us while answering A
question no.1 above. If writ petition no. 534 of 2011 could not
have re-agitated issues touching the validity of annulment of the
tender process, there was no occasion for the High Court to
go into the question whether or not the decision to refer to the
bid and annul the process was vitiated by malice in law or fact. B
The findings recorded by the High Court on the question of mala
tides are, therefore, liable to be set aside on that ground alone.
24. ·Even otherwise the findings recorded by the High Court
on the question of mala tides do not appear to us to be factually
or legally sustainable. While we do not consider it necessary C
to delve deep into this aspect of the controversy, we may point
out that allegations of mala tides are more easily made than
proved. The law casts a heavy burden on the person alleging
mala tides to prove the same on the basis of facts that are either
admitted or satisfactorily established and/or logical inferences D
deducible from the same. This is particularly so when the
petitioner alleges malice in fact in which event it is obligatory
for the person making any such allegation to furnish particulars
that would prove mala tides on the part of the decision maker.
Vague and general allegations unsupported by the requisite E
particulars do not provide a sound basis for the court to conduct
an inquiry into their veracity. The legal position in this regard is
fairly well-settled by a long line of decisions of this Court. We
may briefly refer to only some of them. In State of Bihar v. P.P.
Sharma 1992 Supp. (1) SCC 222, this Court summed up the F
law on the subject in the following words:
"50. Mala tides means want of good faith, personal bias,
grudge, oblique or improper motive or ulterior purpose.
The administrative action must be said to be done in good G
faith, if it is in fact done honestly, whether it is done
negligently or not. An act done honestly is deemed to have
been done in good faith. An administrative authority must,
therefore, act in a bona fide manner and should never act
for an improper motive or ulterior purposes or contrary to
H
714 SUPREME COURT REPORTS [2012] 9 S.C.R.
A the requirements of the statute, or the basis of the
circumstances contemplated by law, or improperly
exercised discretion to achieve some ulterior purpose. The
determination of a plea of mala fide involves two questions,
namely (i) whether there is a personal bias or an oblique
B motive, and (ii) whether the administrative action is contrary
to the objects, requirements and conditions of a valid
exercise of administrative power.
51. The action taken must, therefore, be proved to have
been made ma/a fide for such" considerations. Mere
c assertion or a vague or bald statement is not sufficient.
It must be demonstrated either by admitted or proved facts
and circumstances obtainable in a given case. If it is
established that the action has been taken mala fide for
any such considerations.or by fraud on power or colourable
D exercise of power, it cannot be allowed to stand."
(emphasis supplied)
25. We may also refer to the decision of this Court in Ajit
E Kumar Nag v. General Manager (PJ), Indian Oil Corpn. Ltd.,
Haldia and Ors. (2005) 7 SCC 764 where the Court declared
that allegations of mala fides need proof of high degree and
that an administrative action is presumed to be bona fide
unless the contrary is satisfactorily established. The Court
observed:
F
56 .......... It is well settled that the burden of proving mala
fide is on the person making the allegations and the
burden is "very heavy". (vide E.P. Royappa v. State of T.N.
(1974) 4 SCC 3) There is every presumption in favour of
G the administration that the power has been exercised bona
fide and in good faith. It is to be remembered that the
allegations of mala fide are often more easily made than
made out and the very seriousness of such allegations
demands proof of a high degree of credibility. As Krishna
H Iyer, J. stated in Gu/am Mustafa v. State of Maharashtra
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 715
PROJECTS LTD. & ORS: [T.S. THAKUR, J.]
(1976) 1 SCC 800 (SCC p. 802, para 2): "It (mala fide) is A
the last refuge of a losing litigant."
26. There is yet another aspect which ~annot be ignored.
As and when allegations of mala tides are made, the persons
against whom the same are levelled need to be impleaded as 8
parties to the proceedings to enable them to answer the
charge. In the absence of the person concerned as a party in
his/her individual capacity it will neither be fair nor proper to
record a finding that malice in fact had vitiated the action taken
by the authority concerned. It is important to remember that a C
judicial pronouncement declaring an action to be mala fide is
a serious indictment of the person concerned that can lead to
adverse civil consequences against him. Courts have,
therefore, to be slow in drawing conclusions when it comes to
holding allegations of mala fides to be proved and only in cases
where based on the material placed before the Court or facts D
that are admitted leading to inevitable inferences supporting the
charge of mala tides that the Court should record a finding in
the process ensuring that while it does so, it also hears the
person who was likely to be affected by such a finding.
Decisions of this Court have repeatedly emphasised this E
aspect, which is of considerable importance. In State of M.P.
and Ors. v. Nandla/ Jaiswal and Ors. (1986) 4 SCC 566,
speaking for the Court, P.N. Bhagwati, J., as His Lordship then
was, disapproved the observations made by the High Court
attributing mala fides and corruption to the State Government F
without there being any foundation in the pleadings for such
observations. The Court declared that wherever allegations of
mala fides are made, it is necessary to give full particulars of
such allegations and to set out material facts specifying the
particular person against whom such allegations are made so G
that he may have an opportunity to controvert such allegations.
The following observations of the Court are apposite:
"39. Before we part with this case we must express
our strong disapproval of the observations made by B.M.
H
716 SUPREME COURT REPORTS [2012] 9 S.C.R.
A Lal, J. in para 1, 9, 17, 18, 19 and 34 of his concurring
opinion. The learned Judge made sweeping observations
attributing mala tides, corruption and underhand dealing
to the State Government. These observations are in our
opinion not at all justified by the record. In the first place it
B is difficult to appreciate how any such observation could
be made by the learned Judge without any foundation for
the same being laid in the pleadings. It is true that in the
writ petitions the petitioners used words such as "mala
fide", "corruption" and "corrupt practice" but the use of
c such words is not enough. What is necessary is to give
full particulars of such allegations and to set out the
material facts specifying the particular person against
whom such allegations are made so that he may have ari
opportunity of controverting such allegations. The
requirement of law is not satisfied insofar as the pleadings
D
in the present case are concerned and in the absence of
necessary particulars and material facts, we fail to see how
the learned Judge could come to a finding that the State
Government was guilty of factual mala fides, corruption and
underhand dealing."
E
27. To the same effect is the decision of this Court in Smt.
Swaran Lata v. Union of India & Ors. (1979) 3 SCC 165, where
the Court emphasized the need for particulars supporting the
allegations of mala fides, in order that the Court may hold an
F inquiry with the same. Absence of such particulars was held to
be sufficient for the Court to refuse to go into the allegations.
The Court said:
"57 ............ The Court would be justified in refusing to
carry on investigation into allegations of mala fides, if
G
necessary particulars of the charge making out a prima
facie case are not given in the writ petition. The burden of
establishing mala fides lies very heavily on the person who
alleges."
H 28. The above was reiterated in a recent decision of this
,
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 717
PROJECTS LTD. & ORS. [T.S. THAKUR. J.]
Court in Nirmal Jeet Singh Hoon v. lrtiza Hussain & Ors. A
(2010) 14 SCC 564 and All India State Bank Officers'
Federation v. Union of India (1997) 9 SCC 151. In the latter
case this Court observed:
"22. There is yet another reason why this contention
8
of the petitioners must fail. It is now settled law that the
person against whom ma/a tides are alleged must be
made a party to the proceeding. The allegation that the
policy was amended with a view to benefit Respondents
4 and 5 would amount to the petitioners contending that C
the Board of Directors of the Bank sought to favour
Respondents 4 and 5 and, therefore, agreed to the
proposal put before it. Neither the Chairman nor the
Directors, who were present in the said meeting, have
been impleaded as respondents. This being so the
petitioners cannot be allowed to raise the allegations of D
mala tides, which allegations, in fact, are without merit."
(emphasis ·supplied)
29. In the case at hand there was no allegation of "malice E
in fact" against any individual nor was any individual accused
of bias, spite or ulterior motive impleaded as a party to the writ
petition. Ev~n Mr. Sudhir Chandra and Jagdeep Dhankar,
learned Senior Counsels appearing for RDS fairly conceded
that RDS had not alleged malice in fact against any individual
who had played any role in the decision making process. What
F
according to them was alleged and proved by RDS was malice
in law, which did not require impleading of individual officers
associated with the decision making process. We will presently
examine whether a case of malice in law had been made out
by the respondent-RDS. But before we do so we wish to point G
out that the High Court had in the absence of any assertion in
the writ petition and in the absence of the officers concerned
recorded a finding suggesting that the officers had acted mala
fide. The High Court named the officers concerned and
concluded that the integrity of the entire process was suspect. H
718 SUPREME COURT REPORTS [2012] 9 S.C.R.
A We shall subsequently extract the passage from the impugned
judgment where the High Court has even without an assertion
of any malice against the officers named in the judgment,
recorded a finding which was. wholly unjustified in the
circumstances of the case especially when the High Court was
B making out a case for RDS which it had not pleaded when nor
were the officers concerned arrayed as parties to the writ
petition, in their individual capacities.
30. Coming then to the question whether the action taken
by the appellant-RGPPL was vitiated by malice in law, we need
C hardly mention that in cases involving malice in law the
administrative action is unsupportable on the touchstone of an
acknowledged or acceptable principle and can be avoided
even when the decision maker may have had no real or actual
malice at work in his mind. The conceptual difference between
D the two has been succinctly stated in the following paragragh
by Lord Haldane in Shearer v. Shields (1914) A.C. 808 quoted
with approval by this Court Additional District Magistrate,
Jabalpur v. Shivkant Shukla (1976) 2 SCC 521
E "410.
Between 'malice in fact' and 'malice in law' there is a broad
distinction .which is not peculiar to any system of
jurisprudence. The person who inflicts a wrong or an injury
upon any person in contravention of the law is not allowed
F to say that he did so with an innocent mind. He is taken to
know the flaw and can only act within the law. He may,
therefore, be guilty of 'malice in law', although., so far as
the state of ins mind was concerned he acted ignorantly,
and in that sense innocently. 'Malice in fact' is a different
G thing. It means an actual malicious intention on the part of
the person who has done the wrongful act."
31. Reference may also be made to the decision of this
Court in State of AP & Ors. v. Goverdhanlal Pitti (2003) 4 SCC
H
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 719
PROJECTS LTD. & ORS. [T.S. THAKUR, J.]
739 where the difference between malice in fact and malice in A
law was summed up in the following words:
"11. The legal meaning of malice is "ill-will or spite towards
a party and any indirect or improper motive in taking an
action". This is sometimes described as "malice in fact". 8
"Legal malice" or "malice in law" means 'something done
without lawful excuse'. In other words, 'it is an act done
wrongfully and wilfully without reasonable or probable
cause, and not necessarily an act done from ill feeling and
spite'. It is a deliberate act in disregard of the rights of C
others'. [See Words and Phrases legally defined in Third
Edition, London Butterworths 1989].
12. Where malice is attributed to the State, it can never
be a case of personal ill-will or spite on the part of the
State. If at all, it is malice in legal sense, it can be D
described as an act which is taken with a oblique or
indirect object... "
(emphasis supplied)
32. To the same effect is the recent decision of this Court E
in Ravi Yashwant Bhoir v. District Collector, Raigad and Ors
(2012) 2 SCC 407 where this Court observed:
"MALICE IN LAW:
F
37. This Court has consistently held that the State is under
an obligation to act fairly without ill will or malice- in fact or
in law. Where malice is attributed to the State, it can never
be a case of personal ill-will or spite on the part of the
State. "Legal malice" or "malice in law" means something G
done without lawful excuse. It is a deliberate act in
disregard to the rights of others. It is an act which is taken
with an oblique or indirect object. It is an act done wrongfully
and willfully without reasonable or probable cause, and not
necessarily an act done from ill feeling and spite. Mala fide
exercise of power does not imply any moral turpitude. It H
720 SUPREME COURT REPORTS [2012] 9 S.C.R.
A means exercise of statutory power for "purposes foreign
to those for which it is in law intended." It means conscious
violation of the law to the prejudice of another, a depraved
inclination on the part of the authority to disregard the rights
of others, where intent is manifested by its injurious acts.
B Passing an order for unauthorized purpose constitutes
malice in law. (See: Addi. Distt. Magistrate, Jabalpur v.
Shivkant Shukla, AIR 1976 SC 1207: Union of India thr.
Govt. of Pondicherry and Anr. v. V. Ramakrishnan and
Ors. ,2005) 8 SCC 394; and Kalabharati Advertising v.
c Hemant Vimalnath Narichania and Ors., AIR 2010 SC
3745)."
33. In the case at hand the final decision to reject the tender
submitted by RDS was taken by the appellant-RGPPL in its
capacity as the owner of the project. GAIL and Ell performed
D only an advisory role whose opinions were recommendatory
and meant to assist the owner to take a final call. The appellant-
RGPPL had from the date of receipt of the recommendations
made to it by Ell and GAIL till the end maintained a consistent
stand and expressed reservations about the capacity of RDS
E to undertake the work. Correspondence exchanged between
RGPPL and GAIL and Ell bears testimony to that fact. In the
challenge mounted before the High Court by Hung Hua/Ranjit
Buildcon Ltd. to the decision holding RDS techno commercially
responsive, RGPPL had no doubt filed a short affidavit
F supporting its decision holding RDS eligible but discovery of
material in proceedings under the RTI Act and an adverse CAG
report instead of clearing the mist had created further confusion
in the process, supporting what may have been a mere hunch
or apprehension in the beginning about the capacity of RDS
G to handle a major project having regard to the fact that it had
overshot the time schedule for completion of a much lesser
project in Car Nicobar. In that backdrop and as owner of a
project being executed at a colossal cost running into hundreds
of crores of rupees, RGPPL was perfectly justified in adopting
H a careful approach to ensure that those found eligible by its
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 721
PROJECTS LTD. & ORS. [T.S. THAKUR, J.]
technical experts and consultants were indeed so qualified and A
possessed the necessary wherewithal, experience and
expertise to execute the project at Dabhol. It was also well
within its right to demand documentary proof from RDS to
support its claim that it had indeed executed the project at Mus
in Car Nicobar area so as to make it eligible for claiming award B
of the works in question. In the course of the hearing we had
on several occasions asked learned counsel for RDS to furnish
documentary evidence to probabilize if not conclusively
establish that RDS had indeed undertaken the execution of the
work involving construction of 400 meters of breakwater which C
it claimed to have executed. Besides, we had directed the
Central Government Counsel to produce before us the relevant
record relating to the project at Car Nicobar in response to
which Mr. Gulati had produced a few files. These files,
according to Mr. Gulati, did not show that RDS had indeed D
executed the breakwater Project of 400 meters length in Car
Nicobar. More importantly Mr. Gulati was unable to disclose the
basis on which the certificates, which RDS had produced to
prove its eligibility, were issued by the engineers concerned.
The files that were produced did not bear any testimony to the E
issue of any such certificates or the basis on which the same
were issued. Our effort to resolve the issue regarding the
eligibility of RDS in these proceedings, therefore, remained
fruitless, no matter we were keen to give a quietus to the
controversy which is delaying indefinitely a project of national
F
importance. The- task of finding an answer to the question of
eligibility was rendered all the more difficult by the fact that the
High Court has not adverted to and resolved that issue on
merits and by reference to the available material. We will advert
to this aspect in some detail a little later. Suffice it to say for G
the present that RGPPL as the owner acting as a prudent and
responsible public authority discharging public trust obligations
was well within its rights to raise questions and seek answers
on an important matter like the eligibility of RDS to participate,
no matter Ell and GAIL had on the basis of the certificates
produced before them recommended RDS as an eligible H
722 SUPREME COURT REPORTS [2012] 9 S.C.R.
A bidder. There was in that view no justification for either RDS
or the High Court to raise an accusing finger against RGPPL
simply because it had demanded proof regarding the claim of
eligibility from RDS or collected relevant information under RTI
Act and referred the material so collected to GAIL and Ell for
B evaluation and opinion. The final decision to scrap the project
being within its powers under the terms of the tender notice
RGPPL's invocation of that power was not in the facts and
circumstances vulnerable to challenge on the ground of malice
in fact or law, on the grounds set out by the High Court even
c assuming that writ petition No.534/2012 was maintainable
notwithstanding the withdrawal of the earlier petition filed by
RDS.
34. Independent of what has been said above we may
point out that the High Court has rested its finding on malafides
D entirely on the conflict between recommendations made by Ell
in its letter dated 8th March, 2010 holding RDS tc be techno
commercially responsive and letter dated 1st December, 2010
by which the said recommendation has been reversed. The
High Court has while dealing with the change in the view taken
E by the Ell, inspired as it was by the legal opinion tendered to
it on the subject, observed:
"It was submitted before us that this opinion became the
edifice for the change of view that the Ell took on
F 1.9.2010. We may note at the outset that the opinion is
completely converse to the stand taken by the Ell up to
11.8.2010. It is pertinent to note (a fact we were told in the
hearing) that the said legal opinion bears the endorsement
of Mr. Grover, Director (Projects) calling upon Mr. R.K.
Bhandari, General Manager (Project), Ell to simply comply
G
with the view taken by the legal department. As noticed
here in above by us, Mr. R.K. Bhandari was the same
gentleman, who on 10.6.201 O had opined that no revision
in the award.recommendation in favour of RDS was called
for. The crucial question which arises, is that, was Mr. R.K.
H
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 723
PROJECTS LTD. & ORS. [T.S. THAKUR, J.]
Bhandari given a chance to express his view on the opinion A
rendered by the legal department. This is ~ pertinent aspect
of matter to our minds since Mr: R.K. Bhandari, followed
by Mr. Ravi Saxena, in Ell and Mr. M.B. Gohil in GAIL were
people who would have dealt with such like contact on a
number of occasions. Being experts in their respective B
fields, they would know what was intended when terms like
"single project" and "single bidder" were put in Clause
8.1.1.1 Therefore, for the legal department of Ell to take
contrary, though "absurd" and "harsh" view, required at
least a modicum of response from the expert, which was c
none other than Mr. R.K. Bhandari dealing with the issue
till 10.6.2010. Mr. Grover Director (Projects) did not deem
it fit to even ask for his comments. Therefore, the integrity
of entire process is suspect to say the least. In any event,
in our view, the opinion is completely contrary to the plain D
language of clause 8.1.1.1."
35. The above clearly shows that the High Court has
recorded its finding on mala fides on the sole basis that Ell
had reviewed its earlier opinion regarding eligibility of RDS.
The High Court, in our opinion, was wrong in doing so. While E
the High Court could find fault with the interpretation which Ell
placed on the provisions of clause 8.1.1.1 on the basis of the
legal opinion tendered to it, it went too far in dubbing the entire
process as mala fide. The High Court appears to have taken
the view as though Mr. R.K. Bhandari, Mr. Ravi Saxena and Mr. F
M.B. Gohil were experts, even in the matter of interpretation of
the terms and conditions of the tender document, who could sit
in judgment over the legal opinion tendered to them. If on an
interpretation of a clause in the tender notice by the legal
department concerned the officers review their decision or G
reverse the recommendations made earlier, the same does not
tantamount to malice in law so as to affect the purity of the entire
process or render it suspect even assuming that the opinion is
on a more thorough and seasoned consideration found to be
wrong. In the absence of any other circumstances suggesting H
724 SUPREME COURT REPORTS [2012] 9 S.C.R.
A that the process was indeed vitiated by consideration of any
inadmissible material or non-consideration of material that was
admissible or misdirection on issues of vital importance, fresh
recommendations made in tune with the legal opinion could not
be held to have been vitiated by malice in law. The High Court,
B it appears, felt that since the officers referred to above were
senior officers they ought to have known what was meant by
terms like 'single project' and 'single bidder' appearing in
clause 8.1.1.1. We need hardly point out that in cases where
the decision making process is multi-layered, officers
c associated with the process are free and indeed expected to
take views on various issues according to their individual
perceptions. They may in doing so at time strike discordant
notes, but that is but natural and indeed welcome for it is only
by independent deliberation, that all possible facets of an issue
are unfolded and addressed and a decision that is most
0
appropriate under the circumstances shaped. If every step in
the decision making process is viewed with suspicion the
integrity of the entire process shall be jeopardized. Officers
taking views in the decision making process will feel
E handicapped in expressing their opinions freely and frankly for
fear of being seen to be doing so for mala tides reasons which
would in turn affect public interest. Nothing in the instant case
was done without a reasonable or probable cause which is the
very essence of the doctrine of malice in law vitiating
administrative actions. We have, therefore, no hesitation in
F holding that the findings recorded by the High Court to the
effect that the process of annulment of the tender process or
the rejection of the tender submitted by RDS was vitiated by
mala tides is unsustainable and is hereby set aside. Question
no. 2 is accordingly answered in the negative.
G
In Re: Question No.3
36. The withdrawal of Writ Petition No.8252 of 2010 with
permission to petitioner-RDS to file a fresh Writ Petition No.534
H of 2011 was followed by the issue of a fresh tender notice in
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 725
PROJECTS LTD. & ORS. [T.S. THAKUR, J.]
which Clause 8, 1.1.1 of the first tender document was modified. A
Clause 8.1.1.1 as it appeared in the second tender notice was
as under:
"The bidder must have completed in a single contract, as
a single bidder or as a leader of a consortium, at least
8
one breakwater (using marine spread-refer Note 1) of
minimum length of 400 m located in sea during the last
20 (twenty) years to be reckoned from the last date of
submission of bids. The scope of work of the above
referred qualifying job should comprise of design,
engineering, construction and project management of the G
breakwater. Land connected breakwater having a
minimum length. of 400m located in sea is also acceptable
provided construction has been carried out using marine
spread as mentioned above."
D
37. Even when RDS claimed to have completed the project
of 400 meters length in Mus-Car Nicobar, it was ineligible to
compete for the works at Dabhol under the above clause as
the work in Car Nicobar was executed under two contracts and
not a 'single contract' which was added to the conditions of E
eligibility under the above clause. The said modification in the
BQC was, according to the RDS, meant to unfairly exclude RDS
from competing. The modified clause was, therefore, assailed
on the ground that it was tailor made to suit the requirement of
other tenderers who had lost out on the "financial bid" front in F
relation to the first tender. The High Court accepted that
contention and declared that the modification in the BQC by
which RDS was rendered ineligible was not justified and
unfairly eliminated it from competing for the allotment of the
works.
G
38. Assailing the above finding of the High Court Mr.
Nariman, learned Solicitor General, argued that if the annulment
of the tender process pursuant to the first tender notice was
held to be valid and beyond challenge at the instance of RDS,
H
726 SUPREME COURT REPORTS [2012] 9 S.C.R.
A the conditions on which fresh tenders are invited including the
conditions of eligibility stipulated in the tender notice was not
open to challenge by a prospective tenderer. Relying upon the
decision of this Court in Air India Ltd. v. Cochin International
Airport Ltd. and Ors. (2000) 2 SCC 617, Mr. Nariman argued
B that the High Court went wrong in declaring the provisions of
Clause 8.1.1.1 of the second tender notice to be legally bad.
The following passage from the above decision is apposite:
"7 ...... The award of a contract, whether it is by a private
party or by a public body or the State, is essentially a
·C commercial transaction. In arriving at a commercial
decision considerations which are paramount are
commercial considerations. The State can choose its own
method to arrive at a decision. It can fix its own terms of
invitation to tender and that is not open to judicial
D S Crut ·n
I y.... "
39. Having said that we must say to the credit of Mr.
Nariman that he made a statement on instructions that in order
to show its bona fides and to prove that it had no intention to
1 E deliberately target or exclude RDS, RGPPL would not apply the
' modified Clause 8.1.1.1 of the second tender notice to fresh
tenders while evaluating them for techno commercial purposes.
RGPPL would, according to Mr. Nariman, treat Clause 8.1.1.1.
in the first tender notice as the applicable clause and the
F second tender process shall be carried forward on the Clause
8.1.1.1 as it stood in the first tender document. The statement
of Mr. Nariman makes it unnecessary for us to examine whether
or not RGPPL was justified in amending the BOC and whether
such amendment was meant to exclude RDS or any other
G similarly situated tenderers from competing for the works. In the
light of the statement made by Mr. Nariman we do not consider
it necessary to go into the juristic aspect relevant to the validity
of the clause extracted above. All that we need say is that
Clause 8.1.1.1 of the second tender notice shall not be
enforced by RGPPL and that the corresponding clause as it
H
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 727
PROJECTS LTD. & ORS. [T.S. THAKUR, J.]
appeared in the first tend~r notice shall govern matters A
stipulated therein. Question No.3 is answered accordingly.
In Re: Question No.4
40. We have while answering Question No.1 held that W.P.
No.534 of 2011, out of which this appeal arises, was 8
maintainable only in so far as the same questioned the
exclusion of RDS from competing for the work in question. That
exclusion could be on account of a change in the conditions of
eligibility as was sought to be introduced by Clause 8.1.1.1 of
the second tender notice or by reason of RDS being found C
ineligible even under the unamended/original Clause 8.1.1.1 of
the first tender notice. In so far as the amended Clause 8.1.1.1
of the second tender notice is concerned Mr. Nariman's
statement which we have noticed while answering question no.3
above, has put an end to the controversy. RDS cannot, D
therefore, be excluded from· competition based on Clause
8.1.1.1 in the second tender notice. But that does not
automatically make RDS eligible for allotment of the works even
under the first tender notice. The appellant's case is that RDS
was techno commercially ineligible for allotment, and in its E
communication dated 6th October, 2010 it had given the
reasons for that view. We shall presently examine the said
reasons but before we do so we need to point out that the High
Court had quashed the communication and held RDS to be
eligible. That finding has not yet attained finality, as the appellant F
has questioned the judgment of the High Court in the present
appeal. Whether or not RDS is eligible, therefore, remains
relevant not for the purpose of taking the tender process
initiated with the issue of the first tender notice forward but for
purposes of finally determining whether RDS will be eligible to G
participate in any fresh tender notice issued in future, in which
Clause 8.1.1.1 remains, the touch stone for determining the
eligibility of the tenderers. It is in the above background that we
need to examine whether RDS was eligible to compete for the
works based on the first tender notice.
H
728 SUPREME COURT REPORTS {2012] 9 S.C.R.
A 41. In its communication dated 6th October, 2010 the
appellant had summed up the reasons for declaring RDS to be
techno commercially non-responsive in the following words:
"From perusal of the various documents, it can be
concluded that the qualifying project claimed by you to have
B
been awarded in November 2000 had the maximum length
of 290 m and not 400 m required under BOC. The
breakwater(s) at Mus (chainage 22 m to 200 m and
chainage 200m to 330m/490m) was awarded as two
separate projects by the project authority and also
c executed accordingly by the respective agencies.
Further, award for different phases of the project was
made on EHL or M/s Reacon International and you were
also not responsible for the execution of total scope of work
D in any of the two projects.
In the light of the above, it is concluded that RDS
does not meet the BOC requirement of having completed
at least one project of a breakwater in an offshore location
of minimum length of 400, during the last 20 (twenty) years
E
to be reckoned from the last date of submission of bids."
42. A careful reading of the above would show that the
rejection of the bid offered by RDS was based on three distinct
grounds. These are:
F
(i) RDS had claimed the qualifying project to have
been awarded in its favour in November, 2000. The
length of the project so allotted was 290 meters only
as against 400 m~ters required under the BOC.
G (ii) The breakwater at Mus (chainage 22m to 200m and
200 meters to 330/490 meters) were awarded and
executed as two separate Projects, whereas
Clause 8.1.1.1 required that the single bidder
should have executed the required length of
H Breakwater in a Single Project.
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 729
PROJECTS LTD. & ORS .. [T.S. THAKUR, J.]
(iii) The award of the above project was made on EHL A
or M/s Reacon International, for different phases
and RDS was not responsible for the execution of
the total scope of the work in any one of the two
projects.
B
43. RDS has before the High Court and even before us,
claimed that the Breakwater at Mus in Car Nichobar was a
single project arid not two projects as contended by the
appellant-RGPPL. It has further claimed that the entire project
has been executed by it on behalf of EHL, no matter a part of
the work like quarrying of stones/boulders and shipping the C
same from the quarry site to the place of construction was
handled by EHL. These works were performed by the above
two agencies for monetary consideration on behalf of RDS who
was entitled to associate them with the execution of the project
work in terms of the conditions of contract; under which EHL D
had engaged RDS.
44. The case of the appellant on the other hand is that the
only purpose behind stipulating that the tenderer should have
executed a breakwater project as a single tenderer with a E
minimum length of 400 meters ·was to ensure that only such
tenderers are held eligible as have executed a "single project"
of that length 'single handledly' without associating any other
agency with the execution of the work. It was important for the
appellant to do so because the breakwater length in the present F
case is more than four times the length stipulated as a
condition of eligibility. It is the further case of the appellant that
apart from Recon International one Surya Rao was also
associated with the execution of the project, which fact is
according to the appellant evident from the government files G
produced by Mr. Gulati appearing for the Central Government.
45. On the question whether the Breakwater constructed
at Mus in Car Nicobar comprised one or two projects, also
there was some debate which was rendered academic, by Mr.
Nariman, making a fair and unqualified concession that for H
730 SUPREME COURT REPORTS (2012) 9 S.C.R.
A purposes of determining the eligibility of RDS the L · · ikwater
at Mus Car Nicobar could be treated as a single project. With
that concession, what remains to be determined is whether
RDS had limited its claim to eligibility only on the award made
in its favour in November, 2000. If so, whether it is debarred or
B stopped from claiming that it had executed the project from
chainage 22 meters to 200 meters also. More importantly,
whether RDS had actually executed the Breakwater Project at
Mus Car Nicobar with a length of 400 meters.
46. We looked in vain for a finding on the above questions
C in the impugned judgment leave alone one that satisfactorily
dealt with the material placed by the parties on record in support
of their respective cases. What we found was a concession
attributed to Ms. Indra Jai Singh, learned Additional Solicitor
Gen~ral to which the High Court referred in Para 30.2 of its
D order, and which by far is the only reason given by the High
Court for holding that RDS had executed the Breakwater
project at Mus in Car Nicobar. The High Court observed:
"30.2
E
We may note at this stage that we had had pointedly put
to the ASG Ms. Indra Jai Singh during the course of
hearing, as to whether there was any doubt or dispute that
RDS had 11ot executed the qualifying work at Mus Car
Nicobar lsiand equivalent to the contracted length of 500
F meters. Ms. Indra Jai Singh, on instructions, categorically
informed us that this aspect of the matter was not in issue.
She, however, submitted that what was in issue, was the
fact, that since it had not emerged that RDS had completed
the project in two (2) phases; according to Ell, it was not
G eligible. With Ell having taken this stand, which was not
contradicted by GAIL at the hearing; it quite surprised us
when Mr. Chandiok appearing on behalf of RGPPL took
the stand that RDS had not even constructed the required
minimum 400 meters length of qualifying work."
H
RATNAGIRI GAS & POWER PVT. LTD. v. RDS 731
PROJECTS LTD. & ORS. [T.S. THAKUR, J.]
47. Ms. Indra Jai Singh appearing for the Central A
Government argued that the High Court had misconstrued her
statement, in as much as no concession as attributed to her
was made or could be made when the relevant record did not
bear any evidence of RDS having been associated with the
project in question. M(. Nariman contended that the concession B
even if made did not bind the appellant RGPPL, who as a
separate legal entity was entitled to argue, as it indeed argued,
before the High Court that RDS had not been associated with
or executed the entire project, at Mus Car Nicobar, hence was
not eligible to compete. c
48. There is considerable merit in the submission made
by the learned counsel for the appellants and Ms. Jai Singh. A
concession even if made by one of the parties could not prevent
the other parties from arguing that it did not bind them or that
the same was contrary to the facts. The High Court ought to D
have examined the issue on merits, rather than taking a short
cut. The High Court has incidentally taken support from the
certificate dated 5th April, 2008 and clarification issued on 5th
June, 2010 to hold that the RDS had indeed executed the
qualifying project at Car Nicobar. We had in the course of the E
hearing asked Mr. Gulati, learned counsel for the Central
Government, to disclose to us the basis on which the certificate
and the clarification had been issued by the officers concerned.
We got no satisfactory answer to the query. We even asked
the parties to produce the relevant record including the F
government files, so that we could ourselves answer the
question regarding eligibility of RDS but in the absence of any
conclusive evidence, and in the absence of a specific finding
from the High Court, on the question, we remained
handicapped. A remand to the High Court, therefore, became G
inevitable which part we must say in fairness to learned counsel
for both sides, was conceded even by them.
49. In the result we allow these appeals, set aside the
judgment and order passed by the High Court and remand the H
732 SUPREME COURT REPORTS [2012] 9 S.C.R.
A matter back to the High Court with the following directions:
(1) The High Court shall examine and decide afresh the
limited issue whether RDS was eligible to compete for the
works in question in terms of the first tender notice based
on the works which it claims to have executed at Mus in
8
Car Nicobar.
(2) If the High Court comes to the conclusion that RDS is
not eligible in terms of Clause 8.1.1.1 of the first tender
notice as it had not executed a breakwater of the requisite
c length, Writ Petition No. 534 of 2011 filed by the
respondent-RDS shall stand dismissed in toto. Resultantly,
the appellant-RGPPL shall be free to carry forward and
finalize the process of allotment of works started by it in
terms of the second tender notice.
D
(3) In case, however, the High Court comes to the
conclusion that RDS was eligible to compete for the works
in question on the basis of the first tender notice, subject
to that finding attaining finality in any further appeal filed
by the aggrieved party, the appellant-RGPPL shall be free
E
to issue a fresh tender notice without altering the conditions
qf eligibility as stipulated in Clause 8.1.1.1 and finalise the
said process on such other terms and conditions as it may
deem fit and proper to incorporate in the tender notice.
F (4) Keeping in view that the tender process relates to a
project of national importance, the High Court is requested
to dispose of the matter at an early date and as far as
possible within a period of four months from the date a
copy of this order is received by it.
G
50. Parties are left to bear their own costs.
R.P. Appeals allowed.
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