Court should abjure from discussing each and every decision which has dealt with a similar question of law

The sheer plethora of precedents makes it
essential that this Court should abjure from discussing each and every
decision which has dealt with a similar question of law. Failure to
follow this discipline and regimen inexorably leads to prolixity in
judgments which invariably is a consequence of lengthy arguments.
 It is a capital exhaustion of Court time, lack of which has become
critical
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 6772 OF 2013
Rashmi Metaliks Ltd. & Anr.
.....Appellants
Versus
Kolkata Metropolitan Development
Authority & Ors.
.....Respondents
Citation;(2013) 10 SCC 95

VIKRAMAJIT SEN, J.
1. We are called upon to decide the correctness of the impugned decision
of the Division Bench of the High Court of Calcutta which in turn has
upheld the appreciation of the law as also the facts of the case by a
learned Single Judge of that Court.
Thus, these courts have
concurrently concluded that the Appellant-company had failed to
comprehensively correspond to the essential terms of the tender and,
therefore, its offer contained in the said tender was ineligible for
consideration.
2. The two terms of the subject 'Invitation to Tender' which are germane
to the case in hand are clauses (i) and (j) thereof, which read thus –

“(i) A declaration in the form of Affidavit in a non judicial stamp
paper should be submitted stating clearly that the applicant is not
barred/delisted/blacklisted by any Government Department/
Government Undertaking/ Statutory Body/ Municipality and of
the like Government Bodies in DI Pipe-supply tender during last
five years and if any such incident is found at any point of time,
the tender will be cancelled summarily without assigning any
reason whatsoever.
(j) Valid PAN No., VAT No., Copy of acknowledgement of latest
Income Tax Return and Professional Tax Return.”
3. It must immediately be clarified that so far as clause (i) is concerned,
the learned Single Judge had thought it unnecessary to analyse its
applicability and relevance, having come to the conclusion that a
violation of clause (j) had been committed by the Appellant-company
inasmuch as it had failed to file its latest Income Tax Return along with
its bid. This position has continued to obtain even before the Division
Bench as will be palpably clear from a perusal of the impugned
judgment.
The Division Bench, despite noting clause (j), has
concerned itself only with the legal implications flowing from the
alleged non-compliance of clause (i).
The Division Bench has
predicated its decision on W.B. State Electricity Board v. Patel
Engineering Co. Ltd. (2001) 2 SCC 451 and has extracted, as we shall
also do, the following paragraphs therefrom –
“23. The mistakes/errors in question, it is stated, are
unintentional and occurred due to the fault of computer termed as
a “repetitive systematic computer typographical transmission

failure”. It is difficult to accept this contention. A mistake may
be unilateral or mutual but it is always unintentional. If it is
intentional it ceases to be a mistake. Here the mistakes may be
unintentional but it was not beyond the control of Respondents 1
to 4 to correct the same before submission of the bid. Had they
been vigilant in checking the bid documents before their
submission, the mistakes would have been avoided. Further,
correction of such mistakes after one-and-a-half months of
opening of the bids will also be violative of clauses 24.1, 24.3
and 29.1 of the ITB.
24.
The controversy in this case has arisen at the threshold. It
cannot be disputed that this is an international competitive
bidding which postulates keen competition and high efficiency.
The bidders have or should have assistance of technical experts.
The degree of care required in such a bidding is greater than in
ordinary local bids for small works. It is essential to maintain the
sanctity and integrity of process of tender/bid and also award of a
contract. The appellant, Respondents 1 to 4 and Respondents 10
and 11 are all bound by the ITB which should be complied with
scrupulously. In a work of this nature and magnitude where
bidders who fulfil prequalification alone are invited to bid,
adherence to the instructions cannot be given a go-by by
branding it as a pedantic approach, otherwise it will encourage
and provide scope for discrimination, arbitrariness and
favouritism which are totally opposed to the rule of law and our
constitutional
values.
The
very
purpose
of
issuing
rules/instructions is to ensure their enforcement lest the rule of
law should be a casualty. Relaxation or waiver of a rule or

condition, unless so provided under the ITB, by the State or its
agencies (the appellant) in favour of one bidder would create
justifiable doubts in the minds of other bidders, would impair the
rule of transparency and fairness and provide room for
manipulation to suit the whims of the State agencies in picking
and choosing a bidder for awarding contracts as in the case of
distributing bounty or charity. In our view such approach should
always be avoided. Where power to relax or waive a rule or a
condition exists under the rules, it has to be done strictly in
compliance with the rules. We have, therefore, no hesitation in
concluding that adherence to the ITB or rules is the best principle
to be followed, which is also in the best public interest.”
4. The impugned judgment states that clause (j) cannot be viewed as a
non-essential term and, therefore, should have been corrected before
the submission of the tender. This seems to us to be chronologically or
sequentially impossible; what was obviously meant was that failure to
adhere to this term would render the bid non-compliant and, therefore,
beyond the pale of consideration in toto. The Division Bench also
opined that the Appellant-company could not be granted the indulgence
to correct this error, as ‘such facility was not available to other
bidders.’ In saying so, the Division Bench, it appears to us, has diluted
its view that clause (j) is altogether inviolable.
5. The Respondents have endeavoured to raise the alleged violation of
clause (i) before us, but we are in no manner of doubt that this effort

should be roundly rejected. This is despite the fact that an explanation
even in this context has been offered by Mr. K.V. Vishwanathan,
learned senior counsel appearing for the Appellants. We shall desist
from making any observations in regard to this clause (j) since it does
not feature in the analysis of both the courts below. Dr. A.M. Singhvi,
learned senior counsel for the Respondents has cited the following
cases before us : (i)
W.B.
State
Electricity
Board
v.
Patel
Engineering Co. Ltd. (2001) 2 SCC 451 Para 23; (ii) Kanhaiya Lal
Agrawal v. Union of India (2002) 6 SCC 315 Paras 5 and 6; (iii)
Puravankara Projects Ltd. v. Hotel Venus International (2007) 10
SCC 33 Paras 28 to 30; (iv)Sorath Builders v. Shreejikrupa Buildcon
Ltd. (2009) 11 SCC 9 Paras 17 and 28; and (v) Glodyne Technoserve
Ltd. v. State of Madhya Pradesh (2011) 5 SCC 103 Para 47. Mr.
Vishwanathan, learned senior counsel for the Appellants sought to rely
on Poddar Steel Corporation v. Ganesh Engineering Works (1991) 3
SCC 273 and Kanhaiya Lal.
6. This Court, and even more so the High Court as well as the subordinate
courts have to face lengthy arguments in each case because of the
practice of citing innumerable decisions on a particular point of law.
The correct approach is to predicate arguments on the decision which
holds the field, which in the present case is Tata Cellular v. Union of

India (1994) 6 SCC 651 rendered by a three-Judge Bench. The rule of
precedence, which is an integral part of our jurisprudence, mandates
that this exposition of law must be followed and applied even by co-
ordinate or co-equal Benches and certainly by all smaller Benches and
subordinate Courts. We hasten to clarify that if a co-ordinate Bench
considers the ratio decidendi of the previous Bench to be of doubtful
efficacy, it must comply with the discipline of requesting Hon’ble the
Chief Justice to constitute a larger Bench. Furthermore there are some
instances of decisions even of a Single Judge, which having withstood
the onslaughts of time have metamorphosed into high authority
demanding reverence and adherence because of its vintage and
following in contradistinction of the strength of the Bench. This is a
significant characteristic of the doctrine of stare decisis. Tata Cellular
has been so ubiquitously followed, over decades, in almost every case
concerning Government tenders and contracts that it has attained
heights which dissuade digression by even a larger Bench. The law of
precedence and of stare decisis is predicated on the wisdom and
salubrity of providing a firmly founded law, without which uncertainty
and ambiguity would cause consternation in society. It garners legal
predictability, which simply stated, is an essential. Our research has
revealed the existence of only one other three-Judge Bench decision

which has dealt with this aspect of the law, namely, Siemens Public
Communication Networks Private Limited v. Union of India (2008) 16
SCC 215, which is in actuality an anthology of all previous decisions
including Tata Cellular. The sheer plethora of precedents makes it
essential that this Court should abjure from discussing each and every
decision which has dealt with a similar question of law. Failure to
follow this discipline and regimen inexorably leads to prolixity in
judgments which invariably is a consequence of lengthy arguments.
7. It is a capital exhaustion of Court time, lack of which has become
critical. We shall, therefore, confine ourselves to Tata Cellular. We
are mindful of the fact that it is a legitimate exercise, perfectly
permissible for Benches to advance the law provided this exercise does
not lead to a conclusion which is irreconcilable with a binding
precedent. We also would clarify that the manner in which a Bench
appreciates the factual matrix before it can obviously be of value only
if a subsequent case presents identical facts, which remains a rarity.
8. Tata Cellular states thus :
“77. The duty of the court is to confine itself to the question of
legality. Its concern should be :
1. whether a decision-making authority exceeded its powers?
2. committed an error of law,
3. committed a breach of the rules of natural justice,

4.
reached a decision which no reasonable Tribunals would
have reached or,
5. abused its powers.
Therefore, it is not for the Court to determine whether a
particular policy or particular decision taken in the fulfilment of
that policy is fair. It is only concerned with the manner in which
those decisions have been taken. The extent of the duty to act
fairly will vary from case to case. Shortly put, the grounds upon
which an administrative action is subject to control by judicial
review can be classified as under :
(i) Illegality: This means the decision-maker must understand
correctly the law that regulates his decision-making power
and must give effect to it.
(ii) Irrationality, namely, Wednesbury unreasonableness.
(iii)
Procedural impropriety.
The above are only the broad grounds but it does not rule out
addition of further grounds in course of time. As a matter of
fact, in R. v. Secretary of State for the Home Department, ex
parte Brind, (1991) 1 AC 696, Lord Diplock refers specifically
to one development namely, the possible recognition of the
principle of proportionality. In all these cases the test to be
adopted is that the Court should, 'consider whether something
has gone wrong of a, nature and degree which requires its
intervention.”
9. Since we have been deluged with decisions, we must now consider
whether there have been any material additions to the law which per

force are compatible with Tata Cellular.
W.B. State Electricity
Board reiterated the exposition of law contained in Tata Cellular, as it
had to do. On facts it opined that ‘once the unit rate and line item total
are filled in by the bidder, they are unalterable though arithmetical
errors can be rectified’. So far as the law is concerned the position
remains the same significantly, as it must do; the facts bear no
semblance to those in hand. The Court held that the private parties
could not bind the Government by implication.
Although Sorath
Builders makes no reference to Tata Cellular but nevertheless is not
incongruous to it; otherwise it would have been rendered per incuriam.
It merely reiterates that while reasonableness in the Wednesbury mould
is an integral part of administrative law it has no relevance in
contractual law; on facts this Court held that since documents had not
been despatched in accordance with the specified time schedule, the
bid which had already been received on-line could correctly not be
considered. Glodyne Technoserve also applies Tata Cellular; but on
the factual matrix sounds a discordant note so far as the Respondents
who rely on it are concerned, inasmuch as it recognises that it fell
within the discretionary domain of the concerned Authority whether or
not to consider the documents (in that case an ISO Certification) which
had not been submitted as per tender stipulations. Kanhaiya Lal,

relied upon by Shri Vishwanathan, talks in the same timbre in that it
distinguishes between essential and collateral terms of a tender and in
the latter case allows elbow room for exercise of discretion. Although
it may be seen as a facet of Wednesbury reasonableness, this decision
can be seen as adding another factor to Tata Cellular viz., the Court is
empowered to separate the wheat from the chaff. In this exercise the
Court can segregate the essential terms forming the bulwark of the
compact, and whilst ensuring their strict adherence, can allow leniency
towards the compliance of collateral clauses. This analysis of the cited
case-law shows that there is little or no advantage to be gained from
the manner in which the Court has responded to the factual matrix as
other Courts may legitimately place emphasis on seemingly similar
facts to arrive at a different conclusion. But the ratio decidendi has to
be adhered to. Counsel must therefore exhibit circumspection in the
number of cases they cite. The three-Judge Bench in Tata Cellular is
more than sufficient to adumbrate the law pertaining to tenders; the
later decision of the co-ordinate Bench in Siemens is in the nature of
annals of previous decisions on the point.
10.With this brief analysis of the decisions cited at the Bar, we shall now
return to the essential factors that shall determine our decision. The
two clauses that have been debated before us have already been

reproduced by us above. The learned Single Judge had returned the
finding that the Appellant-company’s tender did not correspond to the
essential term of the ‘Invitation to Tender’ in two respects :
(a) The alleged blacklisting of the Appellant-company as
postulated in clause (i); and
(b) The Appellant-company’s failure to furnish/forward the latest
Income Tax Return, as envisaged in clause (j).
11.The letter rejecting the Appellant-company’s offer reads thus :
“Subject: KMDA: Disqualify for Tender No.:01/ KMDA / MAT
/ CE/2013-2014
Date : Mon, 22 Jul 2013 18:13:22 +0530 (IST)
From: tender tender@eternderwizard.com
To: sales.marketingdomestic@rashmigroup.com
Dear RASHI METALIKS LIMITED,
Important Notice:
This is to inform that your bid has been disqualified for the
tender invited by KMDA
Tender No.: 01 / KMDA / MAT / CE / 2013-2014
Line No.: 01
Name of Work : SUPPLY and DELIVERY OF DIFFERENT
DIAMETERS OF DISS K 7 and K 9 PIPES AT DIFFERENT
LOCATION WITHIN KOLKATA METROPOLITAN AREA
Reason for Disqualification : company not having submitted its
latest income tax return along with its Bid.
With regards

Tendering Authority”
12.So far as the first point is concerned, it needs to be dealt with short
shrift for the reason that the Courts below have not thought it relevant
for discussion, having, in their wisdom, considered it sufficient to non-
suit the Appellant-company for its failure on the second count. It has,
however, been explained by Mr. Vishwanathan, learned Senior Counsel
for the Appellant-company that at the material time there was no
blacklisting or delisting of the Appellant-company and that in those
circumstances it was not relevant to make any disclosure in this regard.
The very fact that the Tendering Authority, in terms of its
communication dated 22nd July 2013 had not adverted to this ground at
all, lends credence to the contention that a valid argument had been
proffered had this ground been raised.
Regardless of the weight,
pithiness or sufficiency of the explanation given by the Appellant-
company in this regard, this issue in its entirety has become irrelevant
for our cogitation for the reason that it does not feature as a reason for
the impugned rejection. This ground should have been articulated at
the very inception itself, and now it is not forensically fair or
permissible for the Authority or any of the Respondents to adopt this
ground for the first time in this second salvo of litigation by way of a
side wind. The impugned Judgment is indubitably a cryptic one and

does not contain the reasons on which the decision is predicated. Since
reasons are not contained in the impugned Judgment itself, it must be
set aside on the short ground that a party cannot be permitted to travel
beyond the stand adopted and expressed by it in its earlier decision.
The following observations found in the celebrated decision in
Mohinder Singh Gill vs. The Chief Election Commissioner, New Delhi,
AIR 1978 SC 851 are relevant to this question :
“8. The second equally relevant matter is that when a statutory
functionary makes an order based on certain grounds, its validity
must be judged by the reasons so mentioned and cannot be
supplemented by fresh reasons in the shape of affidavit or
otherwise. Otherwise, an order bad in the beginning may, by the
time it comes to court on account of a challenge, get validated by
additional grounds later brought out.
We may here draw
attention to the observations of Bose J. in Gordhandas Bhanji
(AIR 1952 SC 16) (at p.18):
“Public orders publicly made, in exercise of a statutory
authority cannot be construed in the light of explanations
subsequently given by the officer making the order of
what he meant, or of what was in his mind, or what he
intended to do. Public orders made by public authorities
are meant to have public effect and are intended to affect
the acting and conduct of those to whom they are
addressed and must be construed objectively with
reference to the language used in the order itself.
Orders are not like old wine becoming better as they

grow order.”
13.So far as clause (j) of the detailed notice inviting E-tender
No.01/KMDA/MAT/CE/2013-2014 dated 10.5.2013 emanating from
the office of the Chief Engineer is concerned, it seems to us that
contrary to the conclusion in the impugned judgment, the clause is not
an essential element or ingredient or concomitant of the subject NIT.
In the course of hearing, the Income Tax Return has been filed by the
Appellant-company and scrutinized by us. For the Assessment Year
2011-2012, the gross income of the Appellant-company was
Rs.15,34,05,627, although, for the succeeding Assessment Year 2012-
2013, the income tax was NIL, but substantial tax had been deposited.
We think that the Income Tax Return would have assumed the
character of an essential term if one of the qualifications was either the
gross income or the net income on which tax was attracted. In many
cases this is a salutary stipulation, since it is indicative of the
commercial standing and reliability of the tendering entity. This feature
being absent, we think that the filing of the latest Income Tax Return
was a collateral term, and accordingly the Tendering Authority ought to
have brought this discrepancy to the notice of the Appellant-company
and if even thereafter no rectification had been carried out, the position
may have been appreciably different. It has been asserted on behalf of

the Appellant-company, and not denied by the learned counsel for the
Respondent-Authority, that the financial bid of the Appellant-company
is substantially lower than that of the others, and, therefore, pecuniarily
preferable.
14.In this analysis, we find that the Appeal is well founded and is allowed.
The impugned judgment is accordingly set aside. The disqualification
of the Appellant-company on the ground of it having failed to submit its
latest Income Tax Return along with its bid is not sufficient reason for
disregarding its offer/bid. The Respondents are directed, therefore, to
proceed further in the matter on this predication. The parties shall bear
their respective costs.
.............................................J
.
[T.S. THAKUR]
New Delhi
.............................................J.
September 11, 2013.
[VIKRAMAJIT SEN]

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