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Kimberley Club Pvt. Ltd. vs Krishi Utpadan Mandi Parishad & Ors.

Not available · 2025 INSC 1276Decided 31 Oct 2025
Not available
Justice Surya Kant · Justice Joymalya Bagchi

Background

The Krishi Utpadan Mandi Parishad (a UP statutory market body) floated a tender to lease out a banquet hall/terrace lawn for 10 years, requiring bidders to submit a "haisiyat praman patra" (solvency/net-worth certificate) of at least Rs. 10 crores. The appellant's technical bid was rejected because its certificate was issued by a private architect/valuer rather than a District Magistrate, relying on a UP government notification prescribing that procedure. The Allahabad High Court upheld the rejection, and the appellant approached the Supreme Court.

Decision Breakdown

The Supreme Court held that courts reviewing tender decisions do not sit in appeal over the tendering authority's judgment, but will intervene where a rejection is "dehors" (outside) the actual terms of the tender notice or is patently arbitrary. Examining the tender notice, the Court found that nothing in its conditions required the certificate to be issued specifically by a District Magistrate: that requirement came only from a separate government notification whose applicability to this tender was never spelt out in the tender document itself, and the Mandi Parishad (a statutory body, not a government department) had failed to incorporate that requirement into its own tender conditions. The Court also rejected a fresh justification (that the certificate didn't disclose encumbrances) raised for the first time in the counter-affidavit, holding that a rejection must stand or fall on the grounds actually stated at the time, not new grounds added later in litigation. Since the appellant's valuer-issued certificate showed net worth well above the required Rs. 10 crore threshold, the rejection was quashed and the matter remanded for the tender authority to reconsider the appellant's bid.

Lesson Learnt

A tendering authority cannot reject a bid for failing to meet a requirement that was never actually spelt out in the tender notice itself, and it cannot invent new justifications for a rejection after the fact in court proceedings: the reasons given at the time of rejection are what the rejection must be judged on.

Official source (sci.gov.in)View Judgment (PDF)

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