1 2025:CGHC:25165-DB NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPC No. 3007 of 2025 Danieli India Limited Through Its Authorized Representative R. Achuthan S/o K. Raman, Aged About 42 Years, Technopolis, 5th Floor, B-Wing, Block-Bp, Plot No. Iv, Sector V, Salt Lake, Kolkata - 700091, India ... Petitioner(s) versus 1 - Steel Authourity Of India Limited ( Sail) Bhiali Steel Plant, Through Its Executive Director (Projects), Bhilai, Chhattisgarh – 490001 2 - Director-In-Charge Sail Bhiali Steel Plant, Bhilai, Chhattisgarh – 490001 3 - Director (Technical And Projects) Sail Bhilai Steel Plant, Bhilai, Chhattisgarh – 490001 4 - M/s Taechang Machinery Ind. Co. Ltd. Korea 2bl-11lt, 22, Saryeom- Ro 9beon-Gil, Seogu, Incheon 22744, Republic Of Korea 5 - Metex Engineers 587p Plus 77r, Shakti Vihar Rd, Priyadarshini Nagar, Maitrinagar, Risali, Bhilai, Chhattisgarh 490006 6 - M/s Alok Buildtech Private Limited Street 8 House No. 10 Kadambari Nagar Durg, Near Dhamdha Naka, Durg, Chhattisgarh, 491001 7 - Union Of India Through Its Secretary, Ministry Of Steel, Government Of India, Udyog Bhawan, New Delhi - 110011 ... Respondent(s) For Petitioner(s) : Mr. Vaibhav Shukla, Advocate For Respondent(s) : Mr. Sharad Mishra, Advocate and Mr. Ramakant Mishra, Dy. Solicitor General MANPREET KAUR Digitally signed by MANPREET KAUR Date: 2025.06.19 10:38:17 +0530 2 Hon'ble Shri Ramesh Sinha, Chief Justice Hon'ble Shri Bibhu Datta Guru, Judge Judgment on Board Per Ramesh Sinha, Chief Justice 18.06.2025 1) Heard Mr. Mr. Vaibhav Shukla, learned counsel for the petitioner. Also heard Mr. Sharad Mishra, learned counsel for respondents No. 1 to 3 and Mr. Ramakant Mishra, learned Deputy Solicitor General for respondent No.7/UOI. 2) The present petition has been filed by the petitioner seeking following relief(s):- “i) To direct Respondent No. 1 to conduct a fresh technical evaluation of the bids and ensure compliance with the eligibility criteria of Tender No. PCC/TK/5(829)/2023/09 dated August 30, 2023; ii) Reject and set aside the entire procurement process of Tender No. PCC/TK/5(829)/2023/09 dated August 30, 2023 including any orders issued to Respondent No. 1 in furtherance of such procurement process; iii) To restrict the Respondent No. 1 from proceeding with the Contract. iv) To direct Respondent No. 1 to disclose all evaluation reports and reasons for awarding the contract to Respondent No. 4, Respondent No. 5 and Respondent No. 6 despite their ineligibility; 3 v) Any other appropriate Writ, Order or Direction, in the present facts and circumstances of the case, which may be deemed just and proper by this Hon'ble High Court may kindly also be passed in favour of the petitioner.” 3) The facts, in brief, as projected by the petitioner are that the petitioner Danieli India Limited, is a company incorporated under the provision of the Companies Act, 1956 ("Petitioner") having its registered office at Technopolis, 5th Floor, B-Wing, Block-BP, Plot No. IV, Sector-V, Salt Lake, Kolkata-700091, India. The Petitioner duly participated in the Tender of SAIL Bhilai Steel Plant for the 'Replacement of Hot Leveller No. 1 of Plate Mill at SAIL Bhilai Steel Plant', while fully complying with all eligibility and technical requirements. However, despite meeting the requisite conditions, the contract was arbitrarily awarded to the Consortium, who demonstrably failed to fulfill the essential technical specifications Palated in the Tender documents. The petitioner has made multiple representations dated April 16, 2024, May 29, 2024 and January 30, 2025 in this regard highlighting "mar Respondent No. 4 misleadingly cited a Heat Treatment Leveller as a reference project to comply with the tender specification, which is functionally and technically distinct from the Hot/Cold Leveller required as per the Tender. The fundamental differences between these levellers render Respondent No. 4's bid non-compliant to the eligibility criteria mentioned under Serial No. 6 Eligibility/Qualification requirements for Bidders in the Tender. 4 Furthermore, Respondent No. 5 lacks the necessary expertise in electrical and automation work for Hot Levellers, and Respondent No. 6 wrongly relied on a project involving the Erection and Commissioning of SCP and SAP for M/s Ecomaister Co. Ltd., Korea, at JSW Bellary as this work was executed as a sub- agency, which does not qualify under the tender conditions. At the outset, despite prima facie documentary evidence of these discrepancies, Respondent No. 1 has failed to act in accordance with its own tender conditions and proceeded with an award that is manifestly illegal and arbitrary. The Petitioner repeatedly brought these concerns to the attention of Respondent No. 1 through multiple representations referred above but Respondent No. 1 has failed to acknowledge and provide any response or conduct a fair review of the bidding process. The arbitrary selection of an ineligible bidder violates the principles of fairness in public procurement and the constitutional mandates under Articles 14 and Article 19(1)(g) of the Constitution of India. The Petitioner has been wrongfully denied a fair opportunity in a public procurement process due to the non-transparent and unfair conduct of Respondent No. 1. In view of Respondent No. 1's failure to adhere to the prescribed tender conditions, their disregard for fairness and transparency, their continued inaction in providing reasons for their decision and in not considering a review has left the Petitioner with no alternative but to invoke the writ jurisdiction of this Hon'ble Court. 5 4) Learned counsel for the petitioner submits that as per ITB 1.1, ITB 8.3(b) & (c), and ITB 22.5, the tender required bidders to have prior experience in the design, engineering, supply, erection, and commissioning of a Hot or Cold Leveller for steel plates with a minimum thickness of 30mm in the last 15 years. However, Respondent No. 4, the awarded bidder, failed to meet this requirement, as the reference project submitted pertained to a Heat Treatment Leveller designed to operate within a thickness range of 6mm to 20mm which does not comply with the eligibility criteria of Tender No. PCC/TK/5(829)/2023/09 dated August 30, 2023 for Hot or Cold Leveller for steel plates with a minimum thickness of 30mm. Therefore, the bid submitted by Respondent No. 4 was not eligible for consideration under the tender criteria, making the contract award invalid and in direct violation of the prescribed eligibility conditions. The Heat Treatment Leveller follows a fundamentally different process; unlike a Hot Leveller, which operates in-line with the Plate Mill to correct flatness imperfections and reduce residual stresses through plastic deformation at high temperatures (850°C to 1,150°C), the Heat Treatment Leveler is an off-line process used primarily for altering steel's microstructure at lower temperatures (450°C to 800°C). It does not integrate with the production line, lacks the necessary automation for Hot Levelling, and is unsuitable for the tender requirements at Bhilai Steel Plant. The Petitioner is filing the relevant portion of peer-reviewed Journals and relevant 6 information from notable websites including the official website of Respondent No. 4 to briefly explain the technical differences between a Hot Leveler and a Heat Treatment Leveller. 5) Learned counsel for the petitioner further submits that the Petitioner is not aware of Respondent No. 4 having executed directly or through their partners the erection of such levellers as requested in the Tender eligibility criteria. Respondent No. 5, a consortium member with Respondent No. 4 has not provided any document to establish the necessary expertise in handling electrics and automation work critical for Hot Leveller projects, as explicitly required by the tender specifications. This expertise is fundamental to ensuring the seamless integration of the Leveller within the production line, as it involves complex automation and electrical control systems. Despite this clear non-compliance, no corrective action was taken by Respondent No. 1, and the Consortium was allowed to proceed, compromising both the technical integrity of the project and the fairness of the tendering process. Awarding the contract to a bidder without the requisite expertise not only undermines the project's successful execution but also sets a dangerous precedent for future procurement processes. 6) Learned counsel for the petitioner also submits that the Petitioner is a global leader in leveller technology, possesses extensive experience and a proven track record in executing similar projects worldwide, including the successful supply of two Hot Plate 7 Levellers to the Indian Public Sector. At Bhilai Steel Plant Plate Mill, Petitioner has executed major technological upgrades, including the modernization of two 4-Hi stands with complete automation systems and the replacement of the side trimming shear, demonstrating unparalleled technical competence in the field. Despite meeting all eligibility criteria and possessing unmatched expertise, petitioner's bid was unjustly disregarded in favor of a Consortium that failed to meet fundamental qualification requirements, raising serious concerns regarding the fairness, transparency, and credibility of the tender evaluation process. The Petitioner, not to be disadvantaged in this bidding process, had communicated the Consortium's ineligibility to Respondent No. 1 through multiple representations, including emails dated April 16, 2024, May 29, 2024, and January 30, 2025 and letter dated January 20, 2025. However, the Petitioner, despite fulfilling all eligibility requirements, has been unfairly denied the contract in favor of an unqualified bidder, leading to unfair trade restrictions and lack of competition. Moreover, setting a bad precedent for future procurement processes. Moreover, since Respondent No. 4 has failed to meet the mandatory eligibility criteria specified in the tender is itself invalidating the entire tendering process and setting a dangerous precedent for future procurement processes. Similar view is taken by the Hon'ble Supreme Court of India in Banshidhar Construction Pvt. Ltd. v. Bharat Coking Coal Limited & Others, 2024 INSC 757. The Petitioner submitted 8 multiple representations (April 16, 2024, May 29, 2024, and January 30, 2025), raising concerns over the technical discrepancies and ineligibility of Respondent No. 4, and the Respondent No. 1 failed to investigate or respond or take any appropriate action. Respondent No. 1 did not conduct any proper verification of Respondent No. 4's bid and proceeded with awarding the contract in an arbitrary and opaque manner. This failure to provide any justification or reasoning for awarding the contract to Respondent No. 4, despite its non-compliance with the tender conditions, violates fundamental principles of transparency and fairness in public procurement. Same view is taken by the Hon'ble Supreme Court in ABL International Limited and Another vs. Export Credit Guarantee Corporation of India Limited and Others, (2004) 3 SCC 553. Respondent No. 1 failed to provide any justification or reasoning for awarding the contract to Respondent No. 4 despite its non-compliance with the tender conditions. The absence of transparency in the decision-making process violates fundamental principles of natural justice and fairness. The arbitrary contract award undermines confidence in public procurement and discourages fair participation in government tenders. Moreover, the wrongful selection of an ineligible bidder violates well-established judicial principles protecting fairness in tendering. Courts have repeatedly held that procurement processes must adhere to the eligibility criteria and maintain accountability. Reliance is placed upon the Judgment of 9 the Hon'ble Supreme Court of India in Tata Cellular V. Union Of India, (1994) 6 SCC 651. 7) On the other hand, Mr. Ramakant Mishra, learned Deputy Solicitor General appearing for the Union of India/respondent No. 7 submits that since the tender has been floated by the respondents No. 1 to 3 and even otherwise, no substantial relief has been claimed against the Union of India, it would be respondents No. 1 to 3 who can have a say in this matter. 8) Mr. Sharad Mishra, learned counsel for the respondents No. 1 to 3 / Steel Authority of India Limited submits that he has appeared on advance copy and he has not been provided any assistance in the matter. 9) We have heard learned counsel for the parties, perused the pleadings and documents appended thereto. 10) In nutshell, the grievance of the petitioner is that despite meeting the requisite conditions, the contract was arbitrarily awarded to the Consortium i.e. respondents No. 4 to 6, who demonstrably failed to fulfill the essential technical specifications provided in the Tender documents and thus, there has been discrimination. The tender was floated in the month of August 2023 and the bids were finalised and the work order was awarded to the Consortium on 30.08.2024 and the writ petition was filed on 16.06.2025 after a lapse of almost a year. 11) It is well settled that there is least scope of judicial intervention in tender matters. Recently, the Apex Court, in the matter of 10 Banshidhar Construction Pvt. Ltd. v. Bharat Coking Coal Ltd. & Others, {Civil Appeal No. 11005 OF 2024, decided on 04.10.2024}, taking note of the decisions rendered in various other celebrated judgments, observed as under: “21. There cannot be any disagreement to the legal proposition propounded in catena of decisions of this Court relied upon by the learned counsels for the Respondents to the effect that the Court does not sit as a Court of Appeal in the matter of award of contracts and it merely reviews the manner in which the decision was made; and that the Government and its instrumentalities must have a freedom of entering into the contracts. However, it is equally well settled that the decision of the government/ its instrumentalities must be free from arbitrariness and must not be affected by any bias or actuated by malafides. Government bodies being public authorities are expected to uphold fairness, equality and public interest even while dealing with contractual matters. Right to equality under Article 14 abhors arbitrariness. Public authorities have to ensure that no bias, favouritism or arbitrariness are shown during the bidding process and that the entire bidding process is carried out in absolutely transparent manner. 22. At this juncture, we may reiterate the well-established tenets of law pertaining to the scope of judicial intervention in Government Contracts. 23. In Sterling Computers Limited vs. M/s. M & N Publications Limited and Others1, this Court while dealing with the scope of judicial review of award of contracts held: - “18. While exercising the power of judicial review, in respect of contracts entered into on behalf of the State, the Court is concerned primarily as to whether there has been any infirmity in the “decision making process”. In this connection reference may be made to the case of Chief Constable of the North Wales Police v. Evans [(1982) 3 All ER 141] where it was said that: (p. 144a) 1 (1993) 1 SCC 445 11 “The purpose of judicial review is to ensure that the individual receives fair treatment, and not to ensure that the authority, after according fair treatment, reaches on a matter which it is authorised or enjoined by law to decide for itself a conclusion which is correct in the eyes of the court.” By way of judicial review the court cannot examine the details of the terms of the contract which have been entered into by the public bodies or the State. Courts have inherent limitations on the scope of any such enquiry. But at the same time as was said by the House of Lords in the aforesaid case, Chief Constable of the North Wales Police v. Evans [(1982) 3 All ER 141] the courts can certainly examine whether “decision-making process” was reasonable, rational, not arbitrary and violative of Article 14 of the Constitution.” 24. In Tata Cellular vs. Union of India2, this Court had laid down certain priniciples for the judicial review of administrative action. “94. The principles deducible from the above are: (1) The modern trend points to judicial restraint in administrative action. (2) The court does not sit as a court of appeal but merely reviews the manner in which the decision was made. (3) The court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible. (4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts. 2 (1994) 6 SCC 651 12 (5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principle of reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides. (6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure. Based on these principles we will examine the facts of this case since they commend to us as the correct principles.” 25. It has also been held in ABL International Limited and Another vs. Export Credit Guarantee Corporation of India Limited and Others3, as under: - “53. From the above, it is clear that when an instrumentality of the State acts contrary to public good and public interest, unfairly, unjustly and unreasonably, in its contractual, constitutional or statutory obligations, it really acts contrary to the constitutional guarantee found in Article 14 of the Constitution.” 26. In Jagdish Mandal vs. State of Orissa and Others4, this Court after discussing number of judgments laid down two tests to determine the extent of judicial interference in tender matters. They are: - “22. (i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone; or Whether the process adopted or decision made is so arbitrary and irrational that the court can say: “the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached;” 3 (2004) 3 SCC 553 4 (2007) 14 SCC 517 13 (ii) Whether public interest is affected. If the answers are in the negative, there should be no interference under Article 226. Cases involving blacklisting or imposition of penal consequences on a tenderer/contractor or distribution of State largesse (allotment of sites/shops, grant of licences, dealerships and franchises) stand on a different footing as they may require a higher degree of fairness in action.” 27. In Mihan India Ltd. vs. GMR Airports Ltd. and Others5, while observing that the government contracts granted by the government bodies must uphold fairness, equality and rule of law while dealing with the contractual matters, it was observed in Para 50 as under: - “50. In view of the above, it is apparent that in government contracts, if granted by the government bodies, it is expected to uphold fairness, equality and rule of law while dealing with contractual matters. Right to equality under Article 14 of the Constitution of India abhors arbitrariness. The transparent bidding process is favoured by the Court to ensure that constitutional requirements are satisfied. It is said that the constitutional guarantee as provided under Article 14 of the Constitution of India demands the State to act in a fair and reasonable manner unless public interest demands otherwise. It is expedient that the degree of compromise of any private legitimate interest must correspond proportionately to the public interest.” 28. It was sought to be submitted by the learned Counsels for the Respondents relying upon the observations made in Central Coalfields Limited and Another vs. SLL-SML (Joint Venture Consortium) and Others6, that whether a term of NIT is essential or not is a decision taken by the employer which should be respected. However, in the said judgment also it is observed that if the employer has exercised the inherent authority to deviate from the essential term, such 5 (2022) SCC OnLine SC 574 6 (2016) 8 SCC 622 14 deviation has to be made applicable to all the bidders and potential bidders. It was observed in Para 47 and 48 as under:- “47. The result of this discussion is that the issue of the acceptance or rejection of a bid or a bidder should be looked at not only from the point of view of the unsuccessful party but alsofrom the point of view of the employer. As held in Ramana Dayaram Shetty [Ramana Dayaram Shetty v. International Airport Authority of India, (1979) 3 SCC 489] the terms of NIT cannot be ignored as being redundant or superfluous. They must be given a meaning and the necessary significance. As pointed out in Tata Cellular [Tata Cellular v. Union of India, (1994) 6 SCC 651] there must be judicial restraint in interfering with administrative action. Ordinarily, the soundness of the decision taken by the employer ought not to be questioned but the decision-making process can certainly be subject to judicial review. The soundness of the decision may be questioned if it is irrational or mala fide or intended to favour someone or a decision “that no responsible authority acting reasonably and in accordance with relevant law could have reached” as held in Jagdish Mandal [Jagdish Mandal v. State of Orissa, (2007) 14 SCC 517] followed in Michigan Rubber [Michigan Rubber (India) Ltd. v. State of Karnataka, (2012) 8 SCC 216]. 48. Therefore, whether a term of NIT is essential or not is a decision taken by the employer which should be respected. Even if the term is essential, the employer has the inherent authority to deviate from it provided the deviation is made applicable to all bidders and potential bidders as held in Ramana Dayaram Shetty [Ramana Dayaram Shetty v.International Airport Authority of India, (1979) 3 SCC 489]. However, if the term is held by the employer to be ancillary or subsidiary, even that decision should be respected. The lawfulness of that decision can be questioned on very limited grounds, as mentioned in the various decisions discussed 15 above, but the soundness of the decision cannot be questioned, otherwise this Court would be taking over the function of the tender issuing authority, which it cannot.” 12) Also, the Hon’ble Apex Court, in the matter of Tata Motors Limited Vs. The Birhan Mumbai Electric Supply & Transport Undertaking (BEST) and Ors., {MANU/SC/0608/2023}, observed as under: “52. Ordinarily, a writ court should refrain itself from imposing its decision over the decision of the employer as to whether or not to accept the bid of a tenderer unless something very gross or palpable is pointed out. The court ordinarily should not interfere in matters relating to tender or contract. To set at naught the entire tender process at the stage when the contract is well underway, would not be in public interest. Initiating a fresh tender process at this stage may consume lot of time and also loss to the public exchequer to the tune of crores of rupees. The financial burden/implications on the public exchequer that the State may have to meet with if the Court directs issue of a fresh tender notice, should be one of the guiding factors that the Court should keep in mind. This is evident from a three-Judge Bench decision of this Court in Association of Registration Plates v. Union of India and Ors. reported in MANU/SC/1013/2004: (2005) 1 SCC 679. 53. The law relating to award of contract by the State and public sector corporations was reviewed in Air India Ltd. v. Cochin International Airport Ltd., reported in MANU/SC/3402/2000: (2000) 2 SCC 617 and it was held that the award of a contract, whether by a private party or by a State, is essentially a commercial transaction. It can choose its own method to arrive at a decision and it is free to grant any relaxation for bona fide reasons, if the tender conditions permit such a relaxation. It was further held that the State, its corporations, instrumentalities and agencies have the public duty to be fair to all concerned. Even when some defect is found in the decision-making 16 process, the court must exercise its discretionary powers Under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the court should interfere. 54. As observed by this Court in Jagdish Mandal v. State of Orissa and Ors. reported in MANU/SC/0090/2007: (2007) 14 SCC 517, that while invoking power of judicial review in matters as to tenders or award of contracts, certain special features should be borne in mind that evaluations of tenders and awarding of contracts are essentially commercial functions and principles of equity and natural justice stay at a distance in such matters. If the decision relating to award of contract is bona fide and is in public interest, courts will not interfere by exercising powers of judicial review even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. Power of judicial review will not be invoked to protect private interest at the cost of public interest, or to decide contractual disputes.” 13) Admittedly, the financial bid has been opened and as such, applying the ratio laid down by the Apex Court in Banshidhar Construction Pvt. Ltd. (supra), this Court is of the view that no interference is warranted at this stage and as such, this petition stands dismissed. 14) No order as to costs. Sd/- Sd/- (Bibhu Datta Guru) (Ramesh Sinha) JUDGE CHIEF JUSTICE Manpreet