Bombay High Court Upholds Disqualification Of Tata Motors From E-Buses Tendering Process

The Bombay High Court has upheld the decision of the Brihanmumbai Electric Supply and Transport Undertaking (BEST) disqualifying Tata Motors from the e-buses tendering process.

The Bench of Justice S.V. Gangapurwala and Justice Madhav Jamdar noted that Tata Motors had deviated from the material and the substantial term of the tender.

"The Petitioner, as such, is rightly disqualified for deviating from the material requirements stipulated in the tender", the Court held.

The Court also set aside the decision to accept the tender of EVEY Trans Pvt. Ltd and held that BEST can proceed with fresh tender process if it so desires.

Facts

BEST is engaged in service activity of public passenger transport covering areas in the City of Mumbai and its extended suburbs. In February it had issued e-tender notice inviting two bid e-tender for operation of Stage Carriage Services for public transport of 1400 (+ 50% variation) Single Decker AC Electric buses with driver.

In response to this eight parties including Tata Motors and EVEY Trans Pvt. Ltd submitted their bid.

The technical bid of five tenderers including Tata Motors were rejected. Three bidders, including EVEY Trans Pvt. Ltd were held responsive. Later EVEY Trans Pvt. Ltd was awarded the contract pursuant to the said tender.

Aggrieved by the rejection of the technical bid, Tata Motors filed Writ Petition before the High Court.

Contentions by Parties

Senior Advocate Dr.Abhishek Singhvi appearing for the petitioner-Tata Motors Ltd. submitted that the Petitioner's bid was compliant with Central Motor Vehicle Rules, 1989 (hereinafter referred to as the "CMVR") and the Tender conditions.

He further contended that the action of the BEST was blatantly discriminatory, arbitrary and was vitiated by legal malice. He argued that BEST and EVEY Trans Pvt. Ltd had breached the tender terms and also vitiated the sanctity of the tendering process.

He contended that the tender process failed to get the most competitive and competent bid which is the objective of every public tender.

On the other hand, Senior Advocate Venkatesh Dhond appearing for BEST submitted that BEST, while framing its requirements, consciously opted for a specific reference to "in actual conditions" and consciously excluded any reference to "AIS 040" or "Standard Conditions", in the tender specifications.

He further submitted that Tata Motors had modified the undertaking to be provided by the original equipment manufacturer and stated that the minimum operating kms of the SD buses in a single charge would be 200 kms with 80% SOC certified as per AIS 040 and that the buses would run without any interruption under standard condition as per AIS 040 norms.

He also submitted that Except the Petitioner, none of the bidders had submitted bids making reference to AIS 040 standards or departure from actual tender conditions.

He argued that BEST had specifically required the electric buses of the bidders to run 200 Kms in a single charge with 80% SoC on actual conditions for the relevant gross vehicle weight with air conditioning, without any interruptions.

He contended that Since Tata Motors admittedly failed to comply with the same, BEST had declared their bid as non responsive.

He submitted that if the request of the Petitioner was accepted to cancel the tender, then it would lead to having unfair treatment to EVEY Trans Pvt. Ltd.

Advocate Somasekhar Sundaresan appearing for EVEY Trans Pvt. Ltd, in addition to the submissions of the Counsel for BEST, submitted that the Petitioner was rightly declared to be non-compliant and deviant from the core requirement of the tender. He contended that there was no favouritism towards EVEY Trans Pvt. Ltd. and that their tender was as per the conditions of the tender.

Court's Observations

The Court observed that the Petitioner had deviated from the mandatory condition of the tender.

The Court noted that the petitioner did not submit its bid for 200 Kms @ 80% SoC in single charge on actual condition but at standard test conditions as per AIS 040.

The Court observed "As per the tender condition if a person to whom the contract is awarded i.e. lessee does not comply with the condition of achieving range of 200 Kms at 80% SoC in single charge then he is penalized for the same."

The Court held that the tender of the Petitioner was not compliant with the said clause. Accordingly, the Court observed "The Petitioner has deviated from the material and the substantial term of the tender. The Petitioner, as such, is rightly disqualified for deviating from the material requirements stipulated in the tender."

Next, the Court had to consider whether EVEY Trans Pvt. Ltds' acceptance of the bid by BEST satisfied fairness in action. The Court observed that the decision making process was not fair, and that it lacked fair play in action.

Therefore, the Court set aside the decision of the acceptance of the EVEY Trans Pvt. Ltd's tender.

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