Supreme Court rules that tender authorities cannot reject bids for submitting financial capacity certificates from qualified professionals when tender documents don't explicitly require District Magistrate certificates.
If a government tender requires a financial capacity certificate ("haisiyat praman patra") but does not specify who must issue it, can the authority reject your bid for submitting a certificate from a qualified professional instead of one from a District Magistrate?
No, the authority cannot arbitrarily reject your bid on this ground.
The Supreme Court has ruled that the terms of a tender must be clear and unambiguous. If the tender authority intended for the certificate to be issued exclusively by a District Magistrate, it was legally obligated to state this requirement explicitly in the tender document. The rejection of a technically compliant bid based on an unstated, implied condition is unlawful and invalid.
Krishi Utpadan Mandi Parishad floated tender to let out banquet hall/terrace lawn for 10 years
Kimberley Club Pvt. Ltd. submitted bid with valuation certificate from professional architect cum valuer attached to Income Tax Department
Mandi Parishad rejected appellant's technical bid on ground that certificate was not issued by District Magistrate
Allahabad High Court dismissed writ petition, upholding rejection
Supreme Court issued notice on December 17, 2021 and stayed further execution of tender
Supreme Court ruled rejection was dehors terms of NIT and set aside High Court order
| Legal Principle | What It Means | Application in This Case |
|---|---|---|
| Tender Conditions Must Be Explicit | NIT is the sole rulebook; all requirements must be clearly stated | NIT didn't specify certificate must be from District Magistrate |
| Mohinder Singh Gill Principle | Decision validity judged by reasons mentioned at time of decision | Authority tried to add new reasons in court that weren't in rejection |
| Duty to Seek Clarification | Authority must seek clarification before rejecting bid on minor doubts | If authority doubted encumbrances, should have asked appellant |
| Substantive Compliance | Focus on whether bidder meets core requirements, not technicalities | Certificate showed asset value far exceeded minimum requirement |
The official document published by an authority detailing the project, eligibility criteria, and bidding process. It is the "rulebook" for that tender.
The first stage of a two-stage bidding process where bidders must prove they meet all qualifying criteria before their financial offer is even opened.
A Hindi term for a solvency or financial capacity certificate, intended to prove that a bidder has the necessary net worth or resources.
A legal phrase meaning "outside the terms." An action is dehors the terms if it is not authorized by or contradicts the written rules.
An action or decision that is so manifestly unreasonable, unjust, and without logic that no sensible person could have arrived at it.
"Transparency is the soul of a fair tender process. The rulebook for bidders is contained within the four corners of the Notice Inviting Tender. Authorities cannot play a game of moving goalposts by introducing hidden criteria after the bids are in. A disqualification must be rooted in the explicit language of the tender document, not in the uncharted territory of unwritten assumptions."
This judgment empowers bidders by holding government authorities to a high standard of clarity and fairness. It ensures that tenders are awarded based on merit and explicit criteria, not on arbitrary or after-the-fact interpretations that can foster favoritism and injustice.
This content is for informational purposes only and does not constitute legal advice. Consult a qualified legal professional for specific legal guidance. The information provided is based on judicial interpretation and may be subject to changes in law.
Making Supreme Court judgments accessible and actionable for every Indian citizen navigating legal challenges.
This analysis decodes a complex tender dispute to help businesses and individuals understand their rights when participating in public procurement and how to challenge an unfair disqualification.