The Bombay High Court has ordered the restoration of the tender process for the grant of the Central Store Office while observing that the Tendering Authority made a conscious distinction between warehouses and the Central Store Office in the tender document, and preference ought to have been granted accordingly. The High Court also found the tender conditions to be clear and unambiguous.

The Petitioner had approached the Bombay High Court seeking cancellation of the tender process in pursuance of the Tender Notice issued by the Respondents for the grant of lease of 16 warehouses and a Central Store Office for a tenure of 30 years.

The Division Bench of Chief Justice Alok Aradhe and Justice Sandeep V. Marne said, “The tendering authority itself has drawn a conscious distinction between 16 warehouses and one Central Store Office in the Tender Document. Having done so, it ought to have restricted the preference clause only in respect of bidders applying for allotment of warehouses. Application of preference Clause 4(IV) to bidder applying for allotment of Central Store Office is clearly erroneous. Since the tender conditions are clear and unambiguous, in our view, Clause 4(IV) had no application while allotting the Central Store Office premises, which is clearly distinct from the 16 warehouses as per the Tender Document itself.”

Senior Advocate Anil V. Anturkar represented the Petitioner, while Senior Advocate Kevic Setalwad represented the Respondent.

Factual Background

The Respondents had floated a tender for the grant of lease for five years in respect of its Central Store Office. The Petitioner was successful in the said tender process and was granted a lease in respect of the Central Store Office for the period from March 1, 2013, to February 23, 2018. It was the case of the Petitioner that upon the expiry of the tenure of the lease, extensions were granted to him. In the year 2023, the second Respondent published a Tender Notice for the grant of a license in respect of the Central Store Office for 30 years.

Though the Petitioner and the fourth Respondent submitted a financial bid at the same rate, a decision was taken to allot the lease in respect of the Central Store Office to the fourth Respondent by applying the preference clause in the tender document, since the fourth Respondent had submitted a bid for more number of warehouses. Aggrieved thereby, the Petitioner approached the High Court.

Reasoning

On a perusal of the tender document, the Bench observed that under Clause 4(IV) of the tender document, preference was required to be given in the selection process to the bidder submitting bids for a maximum number of warehouses. The fourth Respondent had submitted bids in respect of a total of nine premises whereas the Petitioner had submitted a bid only for one premise.

One of the arguments raised by the Petitioner was that the Tendering Authority had made a conscious distinction between the warehouses and the Central Store Office. The Bench found considerable force in the submission of the Petitioners that Clause 4(IV) uses the word “warehouses” and does not use the word “premises”. The Bench noticed that Clause 4(IV) of the Tender Document provided for a grant of preference to the bidder submitting bids in respect of the maximum number of ‘warehouses’. If the Tendering Authority intended to apply preference clause 4(IV) even to the Central Store Office, it ought to have used the word “premises” rather than the word “warehouses” in Clause 4(IV).

It was further noticed that there were several clauses in the Tender Document, which indicated that a conscious distinction was made by the Tendering Authority between warehouses and the Central Store Office while implementing the impugned tender process. “Thus the right to apply for allotment of more than premises was restricted only in respect of ‘16 warehouses’, thereby drawing a conscious distinction between ‘warehouses’ and ‘Central Store Office”, it held.

The Bench found the decision of the tendering authority in granting preference to the fourth Respondent by application of Condition No.4 (IV) to be arbitrary and irrational. Thus, setting aside the allotment of the Lease of Central Store Office in favor of the fourth Respondent and restoring the tender process qua the Central Store Office, the Bench ordered, “After holding the renegotiations, Respondent Nos.1 to 3 shall allot lease in respect of Central Store Office to the entity offering higher rate. Except the Petitioner and Respondent No.4, no other bidder shall be entitled to participate in such renegotiation process.”

Cause Title: Vast Media Network Pvt. Ltd v. The State of Maharashtra (Neutral Citation: 2025:BHC-OS:8972-DB)

Appearance

Petitioner: Senior Advocate Anil V. Anturkar, Advocates Harshvardhan Suryavanshi, Sandeep Dubey, Piyush Deshpande

Respondents: Senior Advocate Kevic Setalwad, Government Pleader P.H. Kantharia, Additional Government Pleader Jyoti Chavan, AGP Nazia Sheikh, Advocates Aseem Naphade, Chaitra Rao, Meera Parmar, Jatin Sheth

Click here to read/download Order


Bombay High CourtChief Justice Alok AradheJustice Sandeep V. Marne

Tulip Kanth

Assistant Editor

Tulip Kanth is an Assistant Editor at Verdictum having over 5 years of experience in the field of legal journalism and editing. She extensively covers judgments of the Supreme Court, High Courts as well as Tribunals. She has previously worked with a legal publishing website where she oversaw the work of other editors and has also created updates on notifications of different Government Ministries. She holds an English Honours Degree from SGTB Khalsa College, Delhi University and has completed her LLB course with specialisation in Corporate Law from Amity University.