AI Structured Summary
Not yet generated for this judgment
Judgment
Per. Justice Sanjeev Sachdeva;
This Petition has been taken up for disposal pursuant to an order of remand by the Supreme Court of India by it judgment dated 09.09.2025 passed in Civil Appeal No. 11726/2025 (Arising out of SLP (C) No. 1940/2025), whereby the Supreme Court has directed this Court to consider whether petitioner had requisite spare washing capacity as per Clause 5(B) of the Notice Inviting Tender (NIT for short) and the validity of the work order in favour of the 2nd respondent in light of such decision.
Petitioner had filed this petition inter alia impugning the decision of Respondent No. 1, the Tender Inviting Authority, dated 04.07.2024 whereby petitioner had been disqualified. Petitioner had also sought a declaration that Petitioner was duly qualified to participate as per the criteria set out in the Notice Inviting Tender and a direction to the respondent to re-evaluate petitioner’s technical bid in accordance with the tender criteria.
Initially the petition was filed only against Respondent No. 1, the Tender Inviting Authority. Subsequently the petition was amended to implead the 2nd respondent who was the successful bidder.
On 17.05.2024, respondent No.1 had invited electronic tenders from reputed/established contractors for Run of Mine (RoM) Coal Beneficiation and Managing Associated Logistics. Petitioner alongwith other bidders submitted their bids.
Petitioner was disqualified and was intimated by communication dated 04.07.2024 that the bid of the petitioner had been rejected during Technical Evaluation by the committee for the reason ‘Bidder is disqualified due to non-submission of credentials as per clause No. (5)D of the NIT’.
Relevant portion of Clause (5) D of the NIT dated 17.05.2024 reads as under:
“(5) Credential and PQR:
The prospective bidders who have adequate documents to fulfill criteria of credential and Pre-Qualification-Requirement (PQR) as detailed hereunder for the tender, will upload scanned self-certified copies of requisite documents as required in e-tendering process.
The credential documents and Pre-Qualification Requirement for the tender are as under:
A. ***** ***** ***** *****
D. Past Experience:-
Copies of successfully executed orders (including part executed) in the name of bidder for same or similar work { similar work means coal lifting from mines of CIL subsidiaries or SCCL area, coal beneficiation (through wet process), movement of washed coal by road from washery to railway siding and movement of washed coal through Railways with experience in liaisoning with Railways/ CIL subsidiaries or SCCL area, ‘e., arranging rakes, dispatches coal from own or leased Private siding or Goods shed Railways siding by loading of washed coal into railway wagons through own arrangement with monitoring the rake movement etc. up to the destination Power house}. Bidder is allowed to use past experience of their previous Consortium or Joint Venture (proportionate to its share in that consortium if defined in the Consortium Agreement, otherwise, lead partner if not defined in the Consortium) to meet out the past experience criteria of the tender. The order copies should indicate the above work for 4 Lakh MT (4,00,000 MT) quantity or more in state Owned Power Generating Companies or Other Captive Power Utilities of PSU or NTPC or Govt. Industries / Departments or Semi Govt. industries / Departments or PSUs or Nodal Agency of any PSUs in India executed in last five years ending with initial date of opening of bid are to be uploaded. This order execution should be within a period of twelve (12) months. It may be through single or multiple orders (in parallel), but in case of multiple orders; these should be within a single span of time period of twelve (12) months.
1.The work execution certificate by the customers along-with self-attested un-priced copies of aforesaid work order(s) should be submitted.
2.For Past performance certificates - If worked with MPEB/ MPSEB/ MPPGCL in past for similar work, then it is mandatory to provide Satisfactory Performance Certificate for the same. Failing this, the offer shall not be considered.
E. ***** ***** ***** *****”
The justification given by Respondent No. 1 for technically rejecting the bid of the petitioner was that petitioner had not produced the Joint Venture Agreement to claim the past experience of the previous consortium or joint venture.
The contention on the part of the petitioner was that whatever documents were required to be uploaded, were duly uploaded by the petitioner along with the bid documents and submission of Joint Venture agreement was not required to be uploaded, as the NIT was silent on that point.
This petition was earlier heard by a coordinate bench of this Court, which by its order dated 06.01.2025 dismissed the Petition. The bench held that for the purpose of consideration of past experience criteria of NIT, the filing of consortium/Joint Venture agreement of M/s. Hind Maha Mineral LLP was necessary to substantiate the share of the bidder in that agreement. The Bench held that Clause 5(D) of NIT clearly specified that if the share of partner was not defined in Consortium/Joint Venture Agreement, past experience will be counted in favour of the bid partner and, therefore, non-filing of Joint Venture agreement was not fatal to the case of petitioner and the respondent-department had not committed any error in rejecting the bid of the petitioner during technical evaluation.
The coordinate bench in its order dated 06.01.2025 held that the non production of the consortium/Joint Venture agreement by the Petition was fatal and dismissed the petition.
Arguments had been heard by the coordinate bench and case was reserved for judgment on 04.12.2024. However, in its order dated 06.01.2025, the coordinate bench also went on to deal with another submission raised by Respondent No. 2 for the first time in its written submissions dated 06.12.2024, that under the consortium/Joint Venture agreement dated 06.09.2019, Petitioner was prohibited from carrying out any other work at the plant and washeries owned by it and it did not have minimum spare washing capacity of 0.5 MMT per annum in the nearby area and it adversely impacted the ability of the Petitioner to execute the work and therefore, petitioner was otherwise also disqualified under Clause 5(B) of the NIT.
The coordinate bench in its order dated 06.01.2025 held that even if the documents were provided by the Petitioner, it would have been disqualified as its washeries had been committed to Maharashtra State Mining Corporation Ltd. alone in terms with the Joint Venture Agreement dated 02.12.2019.
Aggrieved by the decision of the coordinate bench dated 06.01.2025, the Petitioner approached the Supreme Court by way of Civil Appeal No.11726/2025 (Arising out of SLP(C) No.1940/2025).
The Supreme Court by its order dated 09.09.2025 held that the bidder had already filed the past experience certificate duly issued by Maharashtra State Mining Corporation (MSMC for short), wherein it was recorded that the MSMC was having contract agreement with JV, wherein M/s Maha Minerals Mining and Beneficiation Private Limited was a partner having 45% share of Joint Venture M/s Hind Maha Mineral LLP vide Joint Venture letter dated 02.12.2019. The Supreme Court has held that the certificate issued by MSMC clearly demonstrates that petitioner had 45% share in a Joint Venture/consortium namely; M/s Hind Maha Mineral LLP and had successfully executed the work of similar nature as required by Clause 5(D) of NIT and that the committee had committed an error in refusing to rely on such certificate and declaring the petitioner disqualified due to non-submission of the copy of the Joint Venture agreement, which was not required at all.
The Supreme Court has held that the disqualification of the petitioner on account of failure to file the Joint Venture Agreement was not sustainable and that respondent no.1 had acted contrary to the terms of the NIT and unfairly rejected petitioner’s bid for non-production of Joint Venture Agreement. It held that Clause 5(D) did not prescribe production of such agreement as mandatory to rely on past experience of such consortium in which the bidder had a defined proportionate share. The Supreme Court set aside the order of the High Court dated 06.01.2025 to the extent it had upheld the decision of the technical evaluation committee in rejecting the bid of the Petitioner.
In respect of the additional ground cited by the coordinate bench of this court in dismissing the petition holding that the petitioner was disqualified as its washeries had been committed to Maharashtra State Mining Corporation Ltd. alone in terms with the Joint Venture Agreement dated 02.12.2019, the Supreme Court held as under:
“(II) Appellant’s disqualification under Clause 5(B) of the NIT
22.However, the High Court went a step further, traversing beyond the reasons given by the Committee and held the Appellant would otherwise be disqualified under Clause 5(B) of the NIT. Clause 5(B) reads as follows -
“Details of Washery:
Bidder should have its own Washery with wet beneficiation technology either of Heavy Media Cyclone or Heavy Media Bath or Wet Jig. The Bidder should have a minimum spare washing capacity using wet a technology of 50% of annual tendered quantity, i.e., 5 Lakh Metric Tonnes (LMT), in area nearby to mines of WCL configured in the tender. Total distance from mine(s) to offered washery (ies) and offered washery (ies) to Railway siding shall not be more than 100. KM.” (emphasis supplied)
23.To arrive at such a finding the High Court relied on written arguments submitted by the 2 respondent and held as per Clauses 3.12, 3.13 and 8.5 of the Joint Venture agreement the appellant’s washeries were committed to MSMC and could not have been used for the present tender. Mr. Hooda rightly contends the issue was raised for the first time in the written submissions and his client did not get the opportunity to controvert the same. Referring to a chart placed before us, he vehemently argues the appellant’s Gondegaon washery had a spare capacity of 1.5 MMTPA which was much higher than the required spare capacity under Clause 5(B) of the NIT. He further contends a request had been made to MSMC to shift their operation to other washeries in terms of Clause 6 of the contract agreement executed between MSMC and the consortium, and the Gondegaon Washery was available for execution of the work under the present NIT.
24.We are of the considered view the aforesaid issue is a contentious one and ought not to have been decided by the High Court without giving opportunity to the appellant to controvert the same. High Court also lost sight of the fact that the Committee had not adverted to this issue and it was impermissible for it to travel beyond the reasons given by the Committee and disqualify the appellant. It is also relevant to note that allotment of work order to 2 respondent has been made subject to the outcome of this proceeding.”
In the above circumstances, the Supreme Court by its order dated 09.09.2025, while setting aside the judgment of the coordinate bench dated 06.01.2025, remanded the matter for a fresh consideration whether appellant had requisite spare washing capacity as per Clause 5(B) of the NIT and the validity of the work order in favour of the 2nd respondent in light of such decision.
The Petition was taken up for hearing by this court on 08.10.2025, when it was partly heard. Thereafter it was listed for further hearing on 09.10.2025. On 09.10.2025, this court noticed that there were no pleading of the parties to substantiate the objections raised by Respondent No. 2 and as also noticed by the Supreme Court that the same emanated out of some written submission that had been filed after the case was closed for judgment. Though arguments were heard in part, respondent No. 2 was directed to file an affidavit clarifying its objections and for the respondent No. 1 and the petitioner to respond to the same.
In the affidavit filed by Respondent No. 2, it is contended that as per the Joint Venture agreement dated 02.12.2019, the members agreed that the plants/washeries of the Parties to the Joint Venture will be in working condition at all times and the washeries of the Petitioner will be kept free and no other works shall be carried out by the Petitioner at such plant or washeries assigned specifically for the Tender. It was contended that the only way dedicated washeries could be freed up was with express prior written consent of the lead Joint Venture Partner, Hind Energy and Coal Beneficiation India Limited (HECB). As per the affidavit, in terms of clause (5)B of the NIT, a bidder must possess at least 0.5 MMT per annum in an area where the total distance from the mines to the offered washery, and from the offered washery to the nearest railway station, does not exceed 100 kilometers. Further, the NIT mandates an annual capacity of 1 MMT, thereby bringing the cumulative capacity requirement to 1.5 MMT per annum. The affidavit further states that as per the affidavit Undertaking submitted by the Petitioner on 24.05.2024 the only washery satisfying these parameters was the Gondegaon Washery with a claimed spare capacity of exactly 1.5 MMT per annum. It is contended that the Petitioner has concealed the fact that washery is currently engaged with MSMC (MAHAGENCO) work.
In the reply affidavit filed by the Petitioner, it is contended that there is no clause in the Joint Venture Agreement that prohibited petitioner from participating in other tenders or utilizing its washeries for execution of other works. It is stated that Clause 3.12 of the Joint Venture Agreement dated 02.12.2019 merely records the agreement between the consortium partners that the Petitioner shall be responsible for carrying out work in the Western Coalfields Limited area and shall utilize its washeries for the said purpose. It is submitted that the said clause does not state that the Petitioner’s washeries shall be used exclusively for the Maharashtra State Mining Corporation work or that the Petitioner cannot use the said washeries for any other work or purpose.
It is stated that Clause 3.12 of the Joint Venture Agreement only deals with allocation of work and responsibilities among the consortium partners and does not impose any restriction on the Petitioner’s ability to undertake other works or participate in other tenders. It is stated that Clause 3.13 of the Joint Venture Agreement provides that the Petitioner agrees to use the washeries situated at Gondegaon, Pimpalgaon, Ghugus and Sasti for the purpose of performance of tender floated by Maharashtra State Mining Corporation only and would not use the said washeries for any other projects or tender. It is contended that said clause does not mean that Petitioner is bound to keep the entire capacity of all its washeries idle and unutilized for the Maharashtra State Mining Corporation work even if only a small portion of the capacity was actually required for the said work.
It is stated that the commitment under Clause 3.13 is a commitment to dedicate and make available the required capacity for the Maharashtra State Mining Corporation work and not a commitment to refrain from using any spare or unutilized capacity for other purposes or projects. It is stated that Petitioner had specifically informed Maharashtra State Mining Corporation about its participation in the said tender and had sought and obtained certification from Maharashtra State Mining Corporation for the said purpose. It is stated that prior to seeking the experience certificate from Maharashtra State Mining Corporation, Petitioner through the consortium M/s Hind Maha Mineral LLP had informed Maharashtra State Mining Corporation that it was proposing to participate in the tender floated by Respondent No. 1 through its Gondegaon washery and that in the event of award of the said tender, Petitioner shall be shifting the ongoing Maharashtra State Mining Corporation work under the Contract Agreement dated 17.12.2020 through its other washeries.
Reliance in placed on Clause 6 of the Contract Agreement dated 17.12.2020 executed between Maharashtra State Mining Corporation Limited and M/s Hind Maha Mineral LLP to contend that it was agreed that if any change in washery/railway siding was requested by the contractor (LLP), then it should not put extra financial burden on Maharashtra State Mining Corporation Limited.
Reference may be had to Clause (5) B of the NIT, which provides for the Details of Washery. Said clause requires that the Bidder should have its own Washery with wet beneficiation technology either of Heavy Media Cyclone or Heavy Media Bath or Wet Jig, further that the Bidder should have a minimum spare washing capacity using wet a technology of 50% of annual tendered quantity, i.e., 5 Lakh Metric Tonnes (LMT), in area nearby to mines of WCL configured in the tender. Total distance from mine(s) to offered washery(ies) and offered washery(ies) to Railway siding shall not be more than 100. KM.
It is an admitted position that Petitioner has its Gondegaon Washery with a claimed spare capacity of exactly 1.5 MMT. Said washery admitted has sufficient spare washing capacity. As per Clause (5) B of NIT, the spare capacity required is 5 LMT (i.e. 0.5 MMT). Admittedly, the spare washing capacity of the said washery is 15 LMT (i.e. 1.5 MMT).
Petitioner has stated that its Gondegaon Washeries has an installed capacity of 2.4 MMT per annum and for the purpose of work awarded by MSMC the capacity of 0.09 MMT per annum was being used and, therefore, 1.5 MMT per annum spare capacity is available in Gondegaon Washery. It is not the case of the Respondents that the said washery does not satisfy the distance requirement from the mine and the railway siding. The only objection to the same raised by the Respondents is that it is engaged for the work of Maharashtra State Mining Corporation work and as such is not available.
It may also be noticed that there is no stipulation in the subject NIT that the washery has to be exclusively engaged or committed for the subject contract. The stipulation is that the washery should have a spare capacity of 5 LMT (i.e. 0.5 MMT).
As per the Petitioner there is no clause in the Joint Venture Agreement dated 02.12.2019 which prohibits it from participating in other tenders or utilizing its washeries for execution of other works.
Respondents have placed reliance on clauses 3.12, 3.13 and 8.5 of the Joint Venture Agreement dated 02.12.2019. Said clauses read as under:
“3.12Each Party agrees, undertakes and ensures that the plants/washeries provided by the Parties to the LLP for the purposes of the Tender shall be in working condition at all times to execute the works of the LLP.
3.13MMMBPL agrees that the plants/washeries provided by MMMBPL shall be kept free at all times and no other works shall be carried on by MMMBPL at such plants/washeries assigned specifically for the Tender.
***** ***** *****
8.5MMMBPL and each of the Promoters represent and warrant that the plants/washeries provided by MMMBPL to the LLP for the purposes of the Tender shall be kept free at all times to execute the works of the LLP only; and no other works shall be carried on by MMMBPL at such plants/washeries assigned specifically for the Tender.”
As per the Petitioner, it owns and operates six washeries with aggregate installed capacity of 14.85 Million Metric Tonnes Per Annum. Said six washeries are located at Gondegaon, Pimpalgaon, Ghugus, Sasti, Khaparkheda and Butibori. Out of the total installed capacity, of the six washeries only 2.1 Million Metric Tonnes Per Annum is currently being utilized leaving a balance spare capacity of 12.75 Million Metric Tonnes Per Annum across all six washeries.
As per the Tender document, Petitioner offered its Gondegaon washery for the purpose of execution of the subject work. The Gondegaon washery has an installed capacity of 2.4 MMT. Out of the installed capacity of 2.4 MMT, a capacity of 0.9 MMT Per Annum is currently being utilized for the work awarded to the consortium M/s Hind Maha Mineral LLP by Maharashtra State Mining Corporation and Maharashtra State Power Generation Company Limited vide Contract Agreement dated 17.12.2020.
We note that there is nothing in the subject NIT prohibiting the Petitioner from using its washeries for multiple projects or works. It is also unreasonable to expect an entity having an installed capacity of 14.85 MMT per annum and utilizing only 2.1 MMT per annum to keep 12.74 MMT per annum unutilized.
Further, as per the Petitioner, out of 2.4 MMT per annum capacity, only 0.9 MMT per annum is being used for the ongoing MSMC/Mahagenco work under contract dated 17.12.2020. The Consortium M/s Hind Maha Mineral LLP by its letter dated 14.06.2024 requested MSMC to issue an experience certificate and in the letter it was specifically pointed out that in the event of award of tender, the petitioner will shift ongoing MSMC/Mahagenco work under contract dated 17.12.2020 to its other washeries. Pursuant to the said letter MSMC has issued the work experience certificate without raising any objection.
The Supreme Court in its order dated 09.09.2025 held that the Respondent No. 1 acted contrary to the terms of the NIT and unfairly rejected the appellant’s bid for non-production of Joint Venture agreement. Clause 5(D) did not prescribe production of such agreement as mandatory to rely on past-experience of such consortium in which the bidder had a defined proportionate share.
With regard to the contention of the 2nd Respondent that the Petitioner did not have the capacity and its disqualification under Clause (5) B, the Supreme Court has inter alia held:
“23.To arrive at such a finding the High Court relied on written arguments submitted by the 2 respondent and held as per Clauses 3.12, 3.13 and 8.5 of the Joint Venture agreement the appellant’s washeries were committed to MSMC and could not have been used for the present tender. Mr. Hooda rightly contends the issue was raised for the first time in the written submissions and his client did not get the opportunity to controvert the same. Referring to a chart placed before us, he vehemently argues the appellant’s Gondegaon washery had a spare capacity of 1.5 MMTPA which was much higher than the required spare capacity under Clause 5(B) of the NIT. He further contends a request had been made to MSMC to shift their operation to other washeries in terms of Clause 6 of the contract agreement executed between MSMC and the consortium, and the Gondegaon Washery was available for execution of the work under the present NIT.
24.We are of the considered view the aforesaid issue is a contentious one and ought not to have been decided by the High Court without giving opportunity to the appellant to controvert the same. High Court also lost sight of the fact that the Committee had not adverted to this issue and it was impermissible for it to travel beyond the reasons given by the Committee and disqualify the appellant. It is also relevant to note that allotment of work order to 2 respondent has been made subject to the outcome of this proceeding.”
As noticed above, the Gondegaon washery of the Petitioner had a capacity of 2.4 MMT per annum and only 0.9 MMT per annum was committed to the MSMC contract and 1.5 MMT per annum is still available. Neither the MSMC contract nor does the subject NIT have an exclusivity clause. This implies that the petitioner is entitled to use the balance capacity for non exclusive contract work.
Further, as also noticed above, the Consortium M/s Hind Maha Mineral LLP by its letter dated 14.06.2024 requested MSMC to issue an experience certificate and in the letter it was specifically pointed out that in the event of award of tender, the petitioner will shift ongoing MSMC/Mahagenco work under contract dated 17.12.2020 to its other washeries. The work experience certificate has been issued by MSMC/Mahagenco without raising any objection.
With regard to the Joint Venture agreement, the Supreme Court has held that production of the Joint Venture agreement was not mandated by the NIT. Thus the clauses of the Joint Venture agreement cannot be relied upon by the Respondents to contend that the petitioner did not have the capacity as per clause (5) B of the NIT. Since as per the Supreme Court, the Joint Venture agreement cannot be relied upon by the Respondents, the contention that the Joint Venture agreements stipulates that the washeries shall be kept free and cannot be used for any other work cannot be a ground to disqualify the bid of the Petitioner.
Strictly speaking, clause (5) B of the NIT requires a spare capacity of 0.5 MMT per annum and the Gondegaon washery of the Petitioner admittedly has a spare capacity of 1.5 MMT per annum. No material has been placed on record by the Respondents to controvert the statement of the Petitioner that 1.5 MMT per annum spare capacity is available at the Gondegaon washery. They only rely on the Joint Venture agreement, which as noticed above cannot be relied upon.
We may also note that the Supreme Court in its judgment dated 09.09.2025, while referring to the order passed by the coordinate bench dated 06.01.2025 dismissing the petition, has held that the High Court had lost sight of the fact that the Committee had not adverted to this issue and it was impermissible for it to travel beyond the reasons given by the Committee to disqualify the petitioner.
The Supreme Court by its order dated 27.01.2025, directed that the allotment of work shall be subject to outcome of the proceedings.
In view of the above, the Petition is allowed in the following terms:
the impugned decision of the technical evaluation committee of Respondent No. 1 dated 04.07.2024, has already been set aside by the Supreme Court by its judgment dated 09.09.2025;
it is held that the petitioner has the requisite spare washing capacity in terms of Clause (5) B of the NIT;
the bid of the petitioner is held to be technically qualified;
the matter is remitted to the Tender Inviting Authority to proceed further with the consideration of the bid of the petitioner in accordance with the NIT and law;
the Tender Inviting Authority shall take a decision within a period of two weeks from today;
the allotment of work to Respondent No. 2, shall be subject to outcome of the result of the consideration of the bid of the Petitioner, in terms of order dated 27.02.2025 of the Supreme Court.
The Petition is disposed of in the above terms. There shall be no orders as to costs.