Simplified Explanation of the Judgment

The Patna High Court, in a decision dated October 5, 2020, addressed a petition filed by a Chartered Accountancy firm that was disqualified from the tender process for appointing concurrent auditors for the Bihar Education Project Council (BEPC) for the financial year 2020–2021.

The firm had applied under a tender issued by BEPC through the Samagra Shiksha Abhiyan. One of the required documents was a “constitution certificate” of the firm. The petitioner submitted such a certificate, along with a firm card containing all relevant details necessary for evaluating the bid.

However, the Tender Evaluation Committee deemed their bid “technically unresponsive,” claiming the certificate submitted did not match the exact format or expectations of the council. Even though all required details were present, the rejection was based on form rather than substance.

The petitioner raised objections the very next day, highlighting that they had indeed furnished all necessary information. Unfortunately, those objections were ignored, and the financial bids of other firms were opened, finalizing selections for different zones.

By the time the matter reached court, concurrent auditors had already been appointed for various zones. However, the High Court did not shy away from evaluating the legality and fairness of the process.

Justice Ashutosh Kumar observed that:

• The petitioner had submitted the required information, even if the document’s format differed from what the council expected.
• The objection raised by BEPC was “technical” in nature and not significant enough to warrant rejection of a qualified bid.
• The rejection appeared arbitrary, especially considering the firm had previously served as auditor for two consecutive years without issue.

Although the Court did not order re-tendering (as new auditors had already been appointed), it issued a strong advisory to the BEPC:

• The Council must avoid such arbitrary decisions in future tender processes.
• Requirements in tenders, particularly regarding documents like “constitution certificates,” must be specified clearly to avoid ambiguity.
• The current disqualification must not prejudice the petitioner’s future participation in tenders.

Significance or Implication of the Judgment

This judgment upholds principles of fairness, transparency, and non-arbitrariness in government procurement processes. It sends a clear message to state agencies and departments that:

• Technicalities should not be used as excuses to disqualify competent bidders.
• Tender documents must be clear, unambiguous, and inclusive to ensure equal opportunity.
• Legitimate bidders must be protected from exclusion based on mere formatting issues.

For professional service providers such as chartered accountants and consultants, this decision reinforces the importance of challenging arbitrary tender rejections. It also sets a precedent that procedural fairness is integral to public tenders.

Legal Issue(s) Decided and the Court’s Decision with Reasoning

• Was the petitioner wrongly disqualified for submitting a differently formatted constitution certificate?
  • Decision: Yes.
  • Reasoning: Although the format differed, the information required was provided. The objection was minor and did not justify rejection.
• Should the BEPC have specified document requirements more clearly in the tender notice?
  • Decision: Yes.
  • Reasoning: The Court directed BEPC to be more specific in future tenders to avoid confusion.
• Can the petitioner’s disqualification impact future tenders?
  • Decision: No.
  • Reasoning: The Court ordered that this litigation must not be used against the petitioner in future engagement processes.

Case Title

Subodh Goel & Co. v. State of Bihar & Ors.

Case Number

CWJC No. 7711 of 2020

Citation(s)

2021(1)PLJR 176

Coram and Names of Judges

Hon’ble Mr. Justice Ashutosh Kumar

Names of Advocates and who they appeared for

• Mr. S.D. Sanjay, Sr. Advocate – for the petitioner
• Mr. Girijesh Kumar – for BEPC
• Mr. Priyadarshi Matri Sharan – for the State

Link to Judgment

https://patnahighcourt.gov.in/viewjudgment/MTUjNzcxMSMyMDIwIzEjTg==-XLPyATDHB10=

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