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Service & Administrative LawSupreme Court of India

M/s Sam Built Well Pvt. Ltd. v. Deepak Builders & Ors.

Civil Appeal · 2017 INSC 1232Decided 14 Dec 2017
Civil Appeal No. 21858 of 2017
Justice Rohinton Fali Nariman · Justice Navin Sinha

Background

The Institute of Nano Science and Technology, Mohali invited tenders for a roughly Rs. 162-crore construction project, requiring bidders to show "similar work" experience (large institutional/educational building campuses). Three separate expert bodies found that Deepak Builders (Respondent No. 1) did not meet this eligibility bar, and its bid was rejected in favour of the appellant, Sam Built Well. A High Court Single Judge upheld the rejection, but a Division Bench reversed that decision and found Deepak Builders eligible, leading the authority to award it the contract.

Decision Breakdown

The Supreme Court restored the Single Judge's ruling and set aside the Division Bench's decision, holding that courts exercising judicial review over technical tender evaluations must defer to the tendering authority's own expert assessment unless that assessment is shown to be arbitrary, mala fide, or perverse: none of which the Division Bench had found here. Since three independent expert committees had all concluded that Deepak Builders' prior projects did not qualify as "similar work" under the tender conditions, the Division Bench had overstepped by substituting its own technical judgment. The contract award to Deepak Builders was set aside and the award to the original appellant restored, with the Court also noting the appellant's offer to match the lower price quoted by Deepak Builders.

Lesson Learnt

Courts will not second-guess an employer's or tendering authority's technical evaluation of bid eligibility in government contracts unless there is clear evidence of bad faith or an irrational/perverse decision: honest disagreement with a reasonable technical judgment is not a ground for judicial interference.

M/s Sam Built Well Pvt. Ltd. v. Deepak Builders & Ors. – Legal Case Shots | LegalAware