NDLI: Mihan India Ltd. Vs. Gmr Airports Ltd. & Ors

Mihan India Ltd. Vs. Gmr Airports Ltd. & Ors

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Mihan India Ltd. Vs. Gmr Airports Ltd. & Ors

Content Provider	Supreme Court of India
e-ISSN	30484839
Language	English
Access Restriction	NDLI
Subject Keyword	Tenders: Annulling of bidding process – Justification of – As per instructions of the Government of India
Content Type	Text
Resource Type	Law Order
Jurisdiction	India
Case Type	Special Leave Petition
Court	Supreme Court of India
Disposal Nature	Appeal Dismissed
Headnote	Tenders: Annulling of bidding process – Justification of – As per instructions of the Government of India, for upgradation, modernization, operation and maintenance of the Nagpur International Airport, appellant company-MIL invited tenders from private parties – Respondents-GAL was the highest bidder – During negotiations regarding the offered revenue share, GAL agreed for the revised revenue share – Thereafter, MIL, accepted the proposal and selected GAL as a highest bidder – However, even on completion of formalities, the Concession Agreement was not executed so as to enable GAL to implement the project – Request made by GAL to MIL but the said letter was neither responded nor any steps were taken to execute the Concession Agreement – MIL then annulled the bidding process and also informed GAL to take back the bid security submitted towards bid and thereafter, re-tendering the bid – Challenged to, by GAL and GNAIL – High Court quashed and set-aside the action of MIL in annulling the bidding as arbitrary, unreasonable and unfair – On appeal, held: Letter dated 07.03.2019 endorsing GAL as a selected bidder would amount to Letter of Acceptance-LoA in terms of the Request for Proposal-RFP and, would be treated as a concluded contract – GAL has qualified the test of responsiveness and on making offer of highest revenue, it was declared selected bidder – LoA has been acknowledged and signed on duplicate copy and returned to Authority within the period as specified – GAL being selected as a highest bidder, acquired the status of concessionaire – It was only the Concession Agreement required to be executed and there was no fault on the part of the GAL in complying with the provisions of RFP – Thus, after proposal of highest revenue share, on issuing the letter of acceptance and also as reflected by conduct, it has become a concluded contract – Letter for annulment of binding process is arbitrary and not in conformity to the terms of RFQ/RFP by following the procedure – Merely having the power of rejection of bids doesn’t entitle authorities to exercise the said power arbitrarily – Public law remedy has rightly been availed, invoking the jurisdiction of the High Court u/Art. 226 – It cannot be said that GAL has limited right only to ask for specific performance – Furthermore, UoI and AAI were not necessary parties and without joining them, the relief as granted by the High Court does not warrants interference – Necessary parties – Public law remedy – Constitution of India – Art. 14, 226 –Airports Authority of India Act, 1994 – S. 12A.Government contracts – Tenets of law – Explanation of – Held: 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 u/Art. 14 abhors arbitrariness - Transparent bidding process is favoured by the Court to ensure that constitutional requirements are satisfied - 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 – Using a ground of public interest or loss to the treasury cannot undo the work already undertaken by the authority.
Judge	N/A
Neutral Citation	2022 INSC 534
Petitioner	Mihan India Ltd.
Respondent	Gmr Airports Ltd. & Ors
SCR	[2022] 19 S.C.R. 523
Judgement Date	2022-05-09
Case Number	3699

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