# M/s AGMATEL INDIA PVT. LTD v. M/s RESOURSYS TELECOM & ORS

- **Citation:** [2022] 18 S.C.R. 861
- **Court:** Supreme Court of India
- **Decided:** 2022-01-31
- **Case number:** Civil Appeal No. 786 of 2022
- **Bench:** Dinesh Maheshwari, Vikram Nath
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/m-s-agmatel-india-pvt-ltd-v-m-s-resoursys-telecom-ors-36170
- **Pages:** 40

## Headnote

Tender - Scope of judicial review - Notice inviting tenders
(NIT) issued by Navodaya Vidyalaya samite (NVS) on Govt. Portal
(GeM) for supply of tablets for school children with specific 'past
performance' criterion that bidder ought to have supplied 'same or
similar category' products to the extent of 80% of bid quantity (which
was changed to 60% by corrigendum) in at least one of the last
three financial years before bid opening - Respondent offered its
bid for the product and was declared disqualified for having fallen
short in 'past performance' criterion by 10.20% - Representation
made by the Respondent seeking clarification of the reason for
rejection which was rejected by the NVS on the ground that only
smart phones were supplied by the Respondent and the product
smart phone does not fall within the description of 'same or similar
category product' vis-a-vis the product required i.e., 'Tablet'- Being
aggrieved, the Respondent preferred the writ petition contending
that 'Tablet' was an electronic product belonging to the 'same or
similar category' as a 'Smart Phone' and that the decision of the
NVS, excluding "Smart Phones" from "same or similar category
products" was unreasonable and against the principles of fair play
and logic - during the pendency of the writ, the successful bidder
AGMATEL/appellant herein was awarded the tender - High Court
allowed the writ petition and disapproved the technical
disqualification - On appeal, held: Technical evaluation or
comparison by the Court is impermissible and the author of the
tender document is taken to be the best person to understand and
appreciate its requirements and if its interpretation is manifestly in
consonance with the language of the tender document or subserving
the purchase of the tender - Court would prefer to keep restraint
and even if the interpretation given to the tender document by the
person inviting offers is not as such acceptable to the Constitutional
Court, that, by itself, would not be a reason for interfering with the
[2022] 18 S.C.R. 861
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interpretation given - The only requirement of law, for such process
of decision making by the tender inviting authority, is that it should
not be suffering from illegality, irrationality, mala fide, perversity,
or procedural impropriety - No such case being made out, the
decision of the tender inviting authority (NVS) in the present case
was not required to be interfered with on the reasoning that according
to the writ Court.
Principles/Doctrines - Doctrine of 'Contra proferentem' -
Applicabilty of - It is applied in the case of ambiguity in the insurance
policy because the policies are made by the insurer and its ambiguity
cannot be allowed to operate against the insured- However, this
rule cannot be applied to lay down that in case of any ambiguity in
a tender document, it has to be construed in favour of a particular
person who projects a particular view point- The obvious
inapplicability of this doctrine to the eligibility conditions in a notice
inviting tender could be visualised from a simple fact that in case of
ambiguity, if two different tenderers suggest two different
interpretations, the question would always remain as to which of
the two interpretation is to be accepted?- Obviously, to avoid such
unworkable scenarios, the principle is that the author of the tender
document is the best person to interpret its documents and
requirements.
Allowing the appeals, the Court
Held: 1.1. The author of the tender document is taken to
be the best person to understand and appreciate its requirements;
and if its interpretation is manifestly in consonance with the
language of the tender document or subserving the purchase of
the tender, the Court would prefer to keep restraint. Further to
that, the technical evaluation or comparison by the Court is
impermissible; and even if the interpretation given to the tender
document by the person inviting offers is n

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M/s AGMATEL INDIA PVT. LTD.
v.
M/s RESOURSYS TELECOM & ORS.
(Civil Appeal No. 786 of 2022)
JANUARY 31, 2022
[DINESH MAHESHWARI AND VIKRAM NATH, JJ.]
Tender - Scope of judicial review - Notice inviting tenders
(NIT) issued by Navodaya Vidyalaya samite (NVS) on Govt. Portal
(GeM) for supply of tablets for school children with specific 'past
performance' criterion that bidder ought to have supplied 'same or
similar category' products to the extent of 80% of bid quantity (which
was changed to 60% by corrigendum) in at least one of the last
three financial years before bid opening - Respondent offered its
bid for the product and was declared disqualified for having fallen
short in 'past performance' criterion by 10.20% - Representation
made by the Respondent seeking clarification of the reason for
rejection which was rejected by the NVS on the ground that only
smart phones were supplied by the Respondent and the product
smart phone does not fall within the description of 'same or similar
category product' vis-a-vis the product required i.e., 'Tablet'- Being
aggrieved, the Respondent preferred the writ petition contending
that 'Tablet' was an electronic product belonging to the 'same or
similar category' as a 'Smart Phone' and that the decision of the
NVS, excluding "Smart Phones" from "same or similar category
products" was unreasonable and against the principles of fair play
and logic - during the pendency of the writ, the successful bidder
AGMATEL/appellant herein was awarded the tender - High Court
allowed the writ petition and disapproved the technical
disqualification - On appeal, held: Technical evaluation or
comparison by the Court is impermissible and the author of the
tender document is taken to be the best person to understand and
appreciate its requirements and if its interpretation is manifestly in
consonance with the language of the tender document or subserving
the purchase of the tender - Court would prefer to keep restraint
and even if the interpretation given to the tender document by the
person inviting offers is not as such acceptable to the Constitutional
Court, that, by itself, would not be a reason for interfering with the
[2022] 18 S.C.R. 861
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interpretation given - The only requirement of law, for such process
of decision making by the tender inviting authority, is that it should
not be suffering from illegality, irrationality, mala fide, perversity,
or procedural impropriety - No such case being made out, the
decision of the tender inviting authority (NVS) in the present case
was not required to be interfered with on the reasoning that according
to the writ Court.
Principles/Doctrines - Doctrine of 'Contra proferentem' -
Applicabilty of - It is applied in the case of ambiguity in the insurance
policy because the policies are made by the insurer and its ambiguity
cannot be allowed to operate against the insured- However, this
rule cannot be applied to lay down that in case of any ambiguity in
a tender document, it has to be construed in favour of a particular
person who projects a particular view point- The obvious
inapplicability of this doctrine to the eligibility conditions in a notice
inviting tender could be visualised from a simple fact that in case of
ambiguity, if two different tenderers suggest two different
interpretations, the question would always remain as to which of
the two interpretation is to be accepted?- Obviously, to avoid such
unworkable scenarios, the principle is that the author of the tender
document is the best person to interpret its documents and
requirements.
Allowing the appeals, the Court
Held: 1.1. The author of the tender document is taken to
be the best person to understand and appreciate its requirements;
and if its interpretation is manifestly in consonance with the
language of the tender document or subserving the purchase of
the tender, the Court would prefer to keep restraint. Further to
that, the technical evaluation or comparison by the Court is
impermissible; and even if the interpretation given to the tender
document by the person inviting offers is not as such acceptable
to the Constitutional Court, that, by itself, would not be a reason
for interfering with the interpretation given. [Para 17][886-H;
887-A-B]
1.2.Even if some organisations/institutions, with reference
to their requirements or other relevant factors, had assumed
these two products, i.e., "Tablets" and "Smart Phones" akin to
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each other, the facts do remain that these very products have
been placed under different categories on the online portal GeM
and have also been taken as classifiable differently by the customs
authority. In the given set of facts and classifications, the decision,
as taken by NVS and its TEC, cannot be said to be suffering from
irrationality, absurdity or mala fide. The analysis of the writ Court
needs to stop at that. Beyond this point, the writ Court would not
be substituting its preferred interpretation of the tender condition
with the one adopted by the author of the tender document and
the person procuring the product, who has to be regarded as the
best person to understand its requirements. [Para 21.1][888-DE]
1.3. Neither the excessive analysis, as entered into by the
High Court, was required in this case nor we would be evaluating
all the specifications of these two products, namely, "Smart
Phones" and "Tablets". Suffice it to notice for the present purpose
that even if both are electronic devices and even if several of
their utility features are the same or similar, their categorisation
under different headings is also a fact not unknown to the parties,
as would appear from the categorisation on the Government
online portal itself. No adjudicatory process is called for and the
interpretation as put by the tender inviting authority-NVS does
not deserve interference. [Para 21.2][888-F-H]
1.4 Even if some of the organisations, in relation to their
requirements, procured tablets and smart phones both under the
same tender process or even used these expressions
"interchangeably" or "interconnected", that by itself cannot lead
to a definite conclusion by the Court that "Smart Phones" and
"Tablets" are to be taken as similar category products for the
tender process in question. [Para 22.4][896-G-H]
1.5. Interference by the High Court in this matter does not
appear justified, particularly when no case of mala fide or bias is
alleged. [Para 23][897-A]
1.6. The process of interpretation of terms and conditions
is essentially left to the author of the tender document and the
M/s AGMATEL INDIA PVT. LTD. v. M/s RESOURSYS
TELECOM & ORS.
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occasion for interference by the Court would arise only if the
questioned decision fails on the salutary tests laid down and
settled by this Court in consistent decisions, namely, irrationality
or unreasonableness or bias or procedural impropriety. [Para
24][897-D-E]
1.7. Even from the extracted part of the principles related
with the 'contra proferentem rule', as reproduced by this Court
from the Halsbury's Laws of England, it is clear that the said rule
was applied in the case of ambiguity in the insurance policy because
the policies are made by the insurer and its ambiguity cannot be
allowed to operate against the insured. This rule, in our view,
cannot be applied to lay down that in case of any ambiguity in a
tender document, it has to be construed in favour of a particular
person who projects a particular view point. The obvious
inapplicability of this doctrine to the eligibility conditions in a
notice inviting tender could be visualised from a simple fact that
in case of ambiguity, if two different tenderers suggest two
different interpretations, the question would always remain as to
which of the two interpretation is to be accepted? Obviously, to
avoid such unworkable scenarios, the principle is that the author
of the tender document is the best person to interpret its
documents and requirements. [Para 24.2][898-B-E]
1.8. It had not been a case of post facto interpretations by
the tender inviting authority-NVS. Certain suggestions made on
behalf of the writ petitioner about the tender inviting authority
changing the terms to suit a particular bidder remain baseless.
No such case of mala fide has been made out; rather, as pointed
out on behalf of the appellant, all the other tenderers clearly
understood the meaning and requirement of the past performance
criterion and stated the particulars of tablets supplied by them in
the past. Such contentions of the writ petitioner have only been
noted to be rejected. [Para 26][899-C-D]
1.9. Consequently, these appeals succeed and are allowed;
the impugned judgment and order dated 27.09.2021 is set aside;
Writ Petition (C) No. 6676 of 2021, as filed by the writ petitioner,
is dismissed with no order as to costs. [Para 29][899-H; 900-A]
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Reliance Energy & Anr. v. Maharashtra State Road
Development Corporation Ltd & Ors. (2007) 8 SCC 1
: [2007] 9 SCR 853 - inapplicable.
Nabha Power Ltd. v. Punjab SPCL (2018) 11 SCC 508
: [2017] 14 SCR 301; United India Insurance Co. Ltd.
v. Orient Treasures (P) Ltd. (2016) 3 SCC 49 : [2016] 1
SCR 1 - distinguished.
Tata Cellular v. Union of India (1994) 6 SCC 651 :
[1994] 2 Suppl. SCR 122 - referred to.
Afcons Infrastructure Limited v. Nagpur Metro Rail
Corporation Limited & Anr. (2016) 16 SCC 818 : [2016]
3 SCR 551; Galaxy Transport Agencies v. New J K
Roadways 2020 SCC OnLine SC 1035 - relied on.
Case Law Reference
[2007] 9 SCR 853
inapplicable
Para 19
[2017] 14 SCR 301
distinguished
Para 24.1
[2016] 1 SCR 1
distinguished
Para 24.2
[1994] 2 Suppl. SCR 122
referred to
Para 11.5
[2016] 3 SCR 551
relied on
Para 16
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 786 of
2022.
From the Judgment and Order dated 27.09.2021 of the High Court
of Delhi at New Delhi in Writ Petition (C) No. 6676 of 2021.
With
Civil Appeal No. 787 of 2022.
 Tushar Mehta, SG, T. Sundar Ramanathan, Udayaditya Banerjee,
Vivek Pandey, Ishaan Chakrabarti, Ms. Harshpreetha, Rupesh Kumar,
Aditya Manubarwala, Ms. Neelam Sharma, Ms. Pankhuri Shrivastava,
Dhananjai Jain, Advs. for the appearing parties.
M/s AGMATEL INDIA PVT. LTD. v. M/s RESOURSYS
TELECOM & ORS.
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The Judgment of the Court was delivered by
DINESH MAHESHWARI, J.
Contents*
Preliminary .......................................................................................... 1
Relevant Factual Matrix and Background .......................................... 3
High Court disapproves the decision of tender inviting authority........ 7
Rival Submissions.............................................................................. 16
Interpretation of Tender Document: Relevant Principles ................. 23
Application of relevant principles to the case at hand ...................... 28
Conclusion ......................................................................................... 44
Preliminary
Leave granted.
2. These two appeals against the same judgment and order dated
27.09.2021, as passed by the High Court of Delhi at New Delhi in Writ
Petition (C) No. 6676 of 2021, have been considered together and are
taken up for disposal by this common judgment.
2.1. By the impugned judgment and order dated 27.09.2021, the
High Court has accepted the writ petition filed by the respondent No. 1
of these appeals (M/s. Resoursys Telecom- hereinafter referred to as
'the writ petitioner') and has disapproved the technical disqualification
and consequential rejection of the technical bid of writ petitioner in respect
of a tender floated by the appellant of the appeal arising out of SLP(C)
No. 16672 of 2021 (Navodaya Vidyalaya Samiti - hereinafter referred
to as 'NVS'). The appellant of the other appeal arising out of SLP(C)
No. 16671 of 2021 (Agmatel India Pvt. Ltd. - hereinafter referred to as
'Agmatel') is said to be the bidder whose offer was accepted by NVS
after technically disqualifying the writ petitioner.
3. The crux of the matter involved in these two appeals is as to
whether the High Court has been justified in interfering with the view
taken by the tender inviting authority, i.e., NVS, in rejection of the technical
bid of writ petitioner for want of fulfilment of 'Past Performance' criterion
about supply of 'same or similar Category Products' of 60% of bid
quantity in at least one of the last three financial years?
*Ed. Note : Pagination in the contents is as per the original Judgment.
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3.1. It may be observed at the outset that a contention had also
been urged, particularly on behalf of Agmatel, that the High Court of
Delhi had no jurisdiction to entertain the subject writ petition when all
the material events took place in the State of Uttar Pradesh and when
the tender inviting authority was also in the State of Uttar Pradesh. The
High Court has rejected this objection with reference to the fact that
such an objection was not taken by the tender inviting authority-NVS,
who was even otherwise operating under the Department of School
Education and Literacy, Ministry of Human Resources Development,
New Delhi. This aspect has not been given much emphasis before us
and we would also leave it at that only, while dealing with the matter on
its merit.
4. It may also be observed that while considering these appeals
initially on 29.10.2021, we had considered it appropriate to take up the
matters for final hearing at the admission stage itself, particularly looking
to the object of the tender process in question, for that being related with
education of the children. However, in the circumstances of the case,
we had stayed the operation of the impugned order of the High Court
while providing that status quo in relation to the tender process in question
shall be maintained by all the concerned. After completion of pleadings,
we have heard learned counsel for the parties finally at the admission
stage.
5. After the foregoing preliminary comments, we may take note
of the factual aspects in brief, and insofar as relevant for the issues at
hand.
Relevant Factual Matrix and Background
6. The dispute in the present appeals has its genesis in a Notice
Inviting Tenders ('NIT') bearing No. GEM/2021/b/1032762, as issued
by the appellant-NVS on 12.02.2021 on the Government online portal
i.e., Government e-market Place ('GeM') for supply of 68,940 Tablets
for school children. The NIT carried with it several of the terms and
conditions but, we are concerned in the present appeals with the terms
and conditions pertaining to 'Experience' and 'Past Performance' of the
bidders. The relevant terms and conditions may be extracted as under: -
"1. Experience Criteria: In respect of the filter applied for
experience criteria, the Bidder or its OEM {themselves or through
reseller(s)} should have regularly, manufactured and supplied same
M/s AGMATEL INDIA PVT. LTD. v. M/s RESOURSYS
TELECOM & ORS. [DINESH MAHESHWARI, J.]
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or similar Category Products to any Central / State Govt
Organization / PSU / Public Listed Company for number of
Financial years as indicated above in the bid document before the
bid opening date. Copies of relevant contracts to be submitted
along with bid in support of having supplied some quantity during
each of the Financial year. In case of bunch bids, the category of
primary product having highest value should meet this criterion.
****** *****
 ******
4. Past Performance: The Bidder or its OEM {themselves or
through re-seller(s)} should have supplied same or similar
Category Products for 80% of bid quantity1, in at least one
of the last three Financial years before the bid opening date
to any Central/State Govt Organization / PSU / Public Listed
Company. Copies of relevant contracts (proving supply of
cumulative order quantity in anyone financial year) to be submitted
along with bid in support of quantity supplied in the relevant
Financial year. In case of bunch bids, the category related to
primary product having highest bid value should meet this criterion."
Bid Specific Additional Terms and Conditions
"****** *****
 ******
3. The Bidder / OEM {themselves or through reseller(s)}, should
have executed project for supply and installation/ commissioning
of same or similar Category Products during preceding 3
financial years (i.e. current year and three previous financial years)
as on opening of bid, as per following criteria:
(i) Single order of at least 35% of estimated bid value; or
(ii) Two orders of at least 20% each of estimated bid value; or
(iii) Three orders of at least 15% each of estimated bid value.
****** *****
 ******
14. Experience Criteria: The Bidder or its OEM
{themselves or through reseller(s)} should have regularly,
manufactured and supplied same or similar Category Products
1 This quantity requirement of 80% was admittedly reduced to 60% by way of a
corrigendum issued by the tender inviting authority.
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to any Central/ State Govt Organization / PSU / Public Listed
Company for 3 years before the bid opening date. Copies of
relevant contracts to be submitted along with bid in support of
having supplied some quantity during each of the year. In case of
bunch bids, the primary product having highest value should meet
this criterion."
(emphasis in bold supplied)
6.1. It is the requirement concerning "same or similar Category
Products" in the aforesaid conditions which forms the bone of contention
in these appeals.
7. The writ petitioner M/s. Resoursys Telecom responded to the
said NIT and offered its bid for the product i.e., "Tablet" which is being
manufactured by an Indian company namely, Lava International Limited,
after having necessary approvals from the manufacturer (OEM). After
opening the technical bids on 08.05.2021, the appellant-NVS rejected
the bid of the writ petitioner on 25.06.2021, while stating the reason of
rejection as 'technical specification mismatch'. The writ petitioner felt
that the grounds for rejection were not discernible and the rejection was
vague and ambiguous; and, therefore, made a representation dated
27.06.2021 seeking clarification of the reason for rejection. The appellantNVS, in its reply dated 29.06.2021, inter alia, stated as under: -
"1. Does not qualify past Performance (Page 124) of tender
document for any of the FY 2018-19, 2019-20, 2020-21. Work
Orders of Smart Phones, Laptops, Aadhar Kits, Printers, Powerbank, etc are not considered as same or similar category products
of tablets."
7.1. The writ petitioner M/s. Resoursys Telecom, as also the said
OEM Lava International Limited submitted further representations while
maintaining that they were duly complying with the Past Performance
clause of the tender document. The appellant-NVS stated in its response
dated 01.07.2021 that they were procuring "Tablets" for learning
management and the Technical Evaluation Committee ('TEC') has
considered only "Tablets" under similar category 'to ensure proven
products'.
8. At this juncture, we may take note of the facts emerging on
record that the writ petitioner, in order to assert its fulfilment of the above
referred Past Performance criterion, has relied upon the statements made
M/s AGMATEL INDIA PVT. LTD. v. M/s RESOURSYS
TELECOM & ORS. [DINESH MAHESHWARI, J.]
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by its OEM in the letter dated 16.04.2021, wherein the supplies made in
the financial year 2019-2020 to Punjab Infotech, Directorate of Welfare
of Scheduled Castes-Assam, Directorate of Welfare of Plain Tribes &
Backward Classes-Assam, and Directorate of Women and Child
Development Kerala were referred and it was also stated that they had
received the biggest purchase order of 1,75,443 units of "Smart Phones"
from Punjab Infotech and supplied the device successfully. We shall be
adverting to the relevant details of the said letter dated 16.04.2021
hereafter later, in the segment of discussion.
8.1. It has been the case of the appellants that in the aforesaid
supplies, only smart phones were supplied to Punjab Infotech and to the
Directorate of Women and Child Development, Kerala; and the product
"Smart Phone" does not fall within the description of "same or
similar Category Product" vis-à-vis the product required under
the NIT in question, i.e., "Tablet".
9. Being aggrieved by the decision taken by the tender inviting
authority, the writ petitioner M/s. Resoursys Telecom preferred the writ
petition leading to these appeals with the submissions, inter alia, that
the process in question was vitiated due to an arbitrary and whimsical
decision taken by the tender inviting authority. During the pendency of
writ petition, it was informed by the tender inviting authority that the
contract in question had been awarded to the other bidder who was
found qualified and successful; and the application for impleadment made
by the said successful bidder-Agmatel was allowed by the High Court.
High Court disapproves the decision of tender inviting
authority
10. In essence, the submission of the writ petitioner before the
High Court was that a "Tablet" was an electronic product belonging to
the "same or similar category" as a "Smart Phone"; and that the decision
of the NVS, excluding "Smart Phones" from "same or similar Category
Products" was unreasonable and against the principles of fair play and
logic. On behalf of the writ petitioner, strong reliance was placed on
various tender notices issued by other departments and institutions,
including the Electronic and Information Technology Departments of
the States of Kerala, Himachal Pradesh, Bihar and Meghalaya; and it
was submitted that in all such tender notices, the past experience of
supply of tablets and smart phones had been treated alike. On the other
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hand, it was submitted on behalf of the tender inviting authority-NVS
that the products like tablets, computers and smart phones were electronic
goods, distinguishable on the basis of their technical, commercial and
trade- related definitions, norms, and regulations provided by the
authorities concerned. It was also argued that the tender inviting authority
was the best person to interpret the terms of tender, and its decision
could only be examined in case of it being arbitrary, biased or mala fide;
and no such case being alleged, no interference was called for. The
same contentions were urged on behalf of the impleaded party-Agmatel,
while also raising the objection of jurisdiction.
11. While dealing with the rival contentions, the High Court of
Delhi, after rejecting the contention on jurisdiction, formed the view that
the product "Smart Phone" was definitely a similar category product as
"Tablet"; and the tender inviting authority as also its TEC had been
unjustified in giving a restrictive meaning to the terms of NIT; and if at
all there was any ambiguity, the tender inviting authority cannot be left to
the option of interpreting the terms contrary to their plain meaning. The
High Court, therefore, proceeded to allow the writ petition and
disapproved the rejection of technical bid of the writ petitioner. It shall
be appropriate to summarise the relevant aspects of the reasons that
prevailed with the High Court in allowing the writ petition.
11.1. The High Court took note of the contentions that the tender
floating authority was the best judge to determine the conditions of a
tender but, in that regard, referred to a passage from the decision of this
Court in the case of Reliance Energy & Anr. v. Maharasthra State
Road Development Corporation Ltd & Ors.: (2007) 8 SCC 1 to the
effect that in invitation to tenders, the terms and conditions must indicate
the norms and benchmarks with legal certainty; and if there be any
vagueness and subjectivity in the said norms, it may result in unequal
and discriminatory treatment and violate the doctrine of "level playing
field". The High Court, thereafter, observed that it was nobody's case
that "Smart Mobile Phones" were the "same" category products as
"Tablets"; and that the issue was as to whether under the terms of NIT,
"Smart Mobile Phones" could be called "similar Category Products" as
"Tablets".
11.2. Thereafter, the High Court referred to the aforementioned
terms and conditions of NIT and opined that when the expression used
had been "category" before the word "product" and with the qualifying
M/s AGMATEL INDIA PVT. LTD. v. M/s RESOURSYS
TELECOM & ORS. [DINESH MAHESHWARI, J.]
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expression "similar", the intendment was not to exclude such products
which were of "similar category"; and the intention had not been to
insist only for "same" category products. Having thus minutely analysed
the expressions "same", "similar" and "category" as also the related
semantics, the High Court proceeded to indicate the perceived similarities
of the two products, i.e., "Smart Phones" and "Tablets" including that
both were electronic products; were used for audio-visual reception/
transmission of data; were having facilities of running programmes and
applications; were sold and traded through the same channels and were
likely to be found in the same shop; and were being sold by the large
manufacturers and producers under the same brand. The High Court,
thus, concluded that even if the said two products were not the "same",
it would not mean that they do not belong to "similar Category of
Products". The High Court further said that the interpretation prevalent
in the market, where these products were treated as falling in "similar"
category, was demonstrated by the writ petitioner with reference to five
tenders floated by different Governments/PSUs in different parts of the
country. Applying such test, the High Court concluded that NVS could
not have excluded the product "Smart Mobile Phones" from the "similar"
category vis-a-vis the product "Tablets". According to the High Court,
the clause in question had been so worded as to provide maximum
competition. These observations and findings of the High Court, forming
the core of its decision, could be usefully reproduced as under: -
"29. From the above, it would be seen that the author of the tender
in question has consciously and repeatedly used the expression
"Category" before the word "Product". Thus, the use of the
expression "Category" is not inadvertent, or unintentional.
Secondly, the author has also repeatedly used the words "same or
similar" in relation to - not the product in question, but in relation
to the category of products to which "Tablet" belongs. The use of
the plural i.e. "Products", and not "Product" also shows that the
author was conscious that within the same or similar category of
products, there would be products other than "Tablets". Pertinently,
the expression used is not "same products", or even "same
Category Products". It is "same or similar Category Products".
Firstly, the use of the word "Category" shows that not just the
same product, but all products which fall in the same category
which are covered. Thus, if the expression used would have been
"same Category Products", other products which fall in the same
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category - as a Tablet, would be covered. The respondents have
themselves enlisted other products which fall in the same category
of products, as Tablets. They are "Slate tablets, Convertible
Tablets, Hybrid Tablets, Phablets, Rugged tablets, Tough
Tablets, Booklet, Microsoft Surface, Amazon Kindle Fire,
Surface Pro Tablet PC, iPad, iPad Air, iPad Pro, iPad Mini,
Samsung Galaxy Tab, and ThinkPad." However, the respondent
NVS has further enlarged the scope, by using the expression
"similar Category Products". By using this expression, all products
which fall in similar categories - to the category in which Tablets
fall, are also covered. The expression "similar" does not mean
"same". Therefore, a thing which is "similar" to another, would
not be the same as that other. In the present context, the word
"similar Category" has to be understood in relation to the nature
and usage of the categories of products being compared.
According to the Cambridge Dictionary, the word "same" means
"exactly like another or each other", whereas the word
"similar" means "looking or being almost, but not exactly, the
same". Thus, if it was indeed the intent of the Respondent to
exclude similar category products, from the category of products
in which "Tablet" falls, they need not have used the words "same
or similar category products". They would have simply said
"same products", or "same category products"
30. Both smart mobile phones, and Tablets, are electronic products.
Both are used for audio-visual reception/ transmission of data.
Both have facility of running programmes and applications to
perform varied tasks, such as, receiving and sending messages/
e-mails, surfing internet, downloading content from the internet,
viewing audio-visual content, transmitting audio-visual and the like.
Both also have the facility to make audio calls through data
networks - though, mobile phones use the mobile call network for
regular calls. Both these products are sold and traded through the
same channels. In the same shop, which sells smart mobile phones,
one is likely to find Tablets, and vice versa. In fact, the larger
manufacturers and producers of electronic goods produce and
sell both - smart mobile phones, and tablets under the same brand.
There are bound to be differences, since these two products are
not "same". They may not even belong to the "same category" of
M/s AGMATEL INDIA PVT. LTD. v. M/s RESOURSYS
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products. However, merely because they are not "same", it does
not mean that they do not belong to "similar category of products".
31. The terms of tender must receive the natural and commonly
understood interpretation, which has been prevalent in the trade.
What is prevalent in the trade has been demonstrated by the
petitioner - by reference to the 5 tenders floated by different
Government/ PSUs in different parts of the country for same/
similar products.
32. Applying the said test, can it be said that the respondent NVS
could exclude smart mobile phones from the similar category of
products, as Tablets? The answer is an emphatic "No". The
Clause, intentionally, has been worded loosely in order to have
maximum competition amongst bidders."
11.3. Thereafter, the High Court took note of the stand taken by
NVS in its reply dated 01.07.2021 and that taken in the counter affidavit
filed before the Court and observed that the TEC of NVS, on its own,
had decided to curtail the competition by narrowing the scope of the
eligibility criteria by taking only tablets as falling under "similar" category
and not considering the past supplies of other products like smart mobile
phones, laptops etc. The High Court, however, observed that exclusion
of the products like Aadhaar kits, printers, power-banks etc. was not
being considered and the TEC might have been justified in not considering
them as falling under "similar" category products but, the TEC could not
have gone outside the scope of tender. The Court further observed that
in the counter affidavit, the averment had been to the effect that the
"Tablets" and "Smart Mobile Phones" were not of "same" product or
"similar" product but the criterion had been of "similar Category of
Products" and these words were not of surplusage. The High Court
disapproved the stance of NVS, as being not in conformity with open
competition and found it unacceptable in public interest. The High Court
observed and held thus: -
"36. Thus, it is evident to us that the Technical Evaluation
Committee (TEC) of the respondent NVS, on its own decided to
curtail the competition by narrowing the scope of the eligibility
criteria, by consideration of only Tablets as falling under similar
category, and not to consider past supplies for other products like
smart phones, laptops, etc, which are covered under "same or
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similar category products", as tablets. We are not concerned
with the exclusion of products like Aadhar kits, printers, power
bank, etc. in the facts and circumstances of the present case.
The TEC of the respondent NVS may have been justified in not
considering past experience/ turnover of supply of products like
aadhar kits, printers, power banks, etc., as falling under similar
category products, as that of the tablets. However, the TEC of
the respondent NVS could not have gone outside the scope of
the tender to lay down its own criteria to determine the eligibility
of the bidders. They were bound to adhere to, and strictly comply
with the terms and conditions stipulated in the tender floated by
NVS. The decision taken by the TEC to exclude from consideration
all other similar category products - for the purpose of evaluating
past performance of the bidders, was wholly incompetent and
beyond the authority of the TEC.
37. From the counter affidavit, we also find that at various places,
the respondent has averred that Tablets and smart mobile phones
are not the same product, or similar product. It appears to us that
the respondent has forgotten the eligibility criteria set out in the
NIT, which is, "same or similar category products", and not
"same product" or even "similar products."
38. If that interpretation as given by the respondent NVS were to
be accepted, the word "similar category of products" becomes a
surplusage, which cannot be the intention attributed to the tender
framing authority.
39. To arbitrarily and whimsically change the goalpost, and
determine what can, and cannot, be considered a "similar product",
at the time of evaluation of bids, disrupts the level playing field
for bidders and extinguishes healthy competition. The respondents
have argued that smartphones and tablets are separate products,
and there can be no doubt about it. This is a no brainer. However,
they don't say that these two products are not even falling under
two different similar categories of products.
40. The restrictive interpretation given by the respondent NVS to
the aforesaid tender conditions - not borne out from the tender
terms and conditions, which would curb competition, does not find
favour with the Court, in Public Interest. The whole purpose of
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issuing a tender is to invite maximum bids from bidders meeting
the technical qualification so that the employer/ tender floating
authority gets the most favourable product/services, at the most
competitive price."
11.4. The High Court, thereafter, referred to a decision of this
Court in Nabha Power Ltd. v. Punjab SPCL: (2018) 11 SCC 508 for
application of the "five condition test" for an implied condition to be read
into the contract, including the "business efficacy test" and highlighted
the principles laid down by this Court that "implied term" was a concept
necessitated when the referred five conditions were satisfied and there
was a strict necessity for it. On that basis, the High Court observed that
NVS could have neither implied any term in the tender nor given restrictive
meaning to the clear language of the tender. The High Court, thereafter,
referred to the doctrine of 'Contra proferentem', as referred to in the
case of United India Insurance Co. Ltd. v. Orient Treasures (P)
Ltd.: (2016) 3 SCC 49, whereby, any ambiguity in an insurance policy
would be resolved by a construction favourable to the insured. The High
Court observed and held that if at all there was an ambiguity, it would be
construed against the drafter of the tender; and in the absence of ambiguity,
the plain meaning of the condition must be complied with. Having said
so, the High Court observed that each and every word of a tender must
be given a meaning, for it being a serious exercise; and TEC cannot
evolve its own criteria to evaluate the eligibility of bidders, contrary to
the terms and conditions of the tender.
11.5. Before concluding on the matter, the High Court observed,
with reference to the decision of this Court in Tata Cellular v. Union of
India: (1994) 6 SCC 651, that the tender floating authority was the
best person to interpret the terms of the tender but the said authority
cannot act arbitrarily, whimsically or contrary to the terms and conditions
of the tender. The High Court reiterated that in the first place, the terms
and conditions were clear and if at all they were ambiguous, it could not
be left to the option of tender floating authority to interpret it in a manner
which is contrary to their plain meaning. The High Court said thus: -
"47. We are conscious of the scope of judicial scrutiny in tender
matters. We are also conscious that the tender floating authority
is best person to interpret the terms of the tender, as they know
what best is the requirement and how to achieve the same. (see
Tata Cellular v. UOI (1994) 6SCC 651) However, the authorities
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cannot act arbitrarily, whimsically and contrary to the terms and
conditions of the tender. As noticed hereinabove, the terms and
conditions of the tender are clear. However, even if the terms of
the tender are unclear and ambiguous, can it be left to the option
of the tender floating authority to interpret it in a manner which is
contrary to their plain meaning? The answer is "No"."
11.6. With the aforementioned reasons, findings and observations,
the High Court proceeded to allow the writ petition and held the rejection
of the technical bid of the writ petitioner as unreasonable and arbitrary,
while holding that "Smart Mobile Phones" fall in "similar Category
Products'. Accordingly, the High Court directed the appellant-NVS to
process the technical bid of the writ petitioner and thereafter proceed in
accordance with law.
11.7. Feeling aggrieved by the aforesaid judgment and order dated
27.09.2021, the tender inviting authority-NVS as also the bidder who is
declared successful-Agmatel have preferred these appeals.
Rival Submissions
12. Assailing the judgment and order so passed by the High Court,
learned Solicitor General of India appearing for the appellant-NVS has
referred to the facts that the tender notice in question was issued for
supply of Tablets for the students of Class XI and XII, with specific past
performance criterion that the bidder or its OEM, themselves or through
resellers, ought to have supplied same or similar category products to
the extent of 80% of bid quantity (which was changed to 60% by
corrigendum) in at least one of the last three financial years before bid
opening date to any Central/State Government Organisation/PSU/Public
Listed Company; and when the technical bids were opened, the writ
petitioner was declared disqualified for having fallen short in past
performance criterion by 10.20%. In this regard, the learned Solicitor
General has particularly referred to the details stated in the additional
affidavit filed on behalf of the appellant-NVS. We shall refer to the
relevant part of these details too, in the segment of discussion.
12.1. The learned Solicitor General would argue that the writ
petitioner had erroneously added its past supplies towards "Smart Phones/
Mobile Handsets" and "Power Banks" so as to fulfil the past performance
criterion required for awarding the tender for "Tablets" and hence, such
supplies were not counted towards the requisite 60% of the bid quantity.
M/s AGMATEL INDIA PVT. LTD. v. M/s RESOURSYS
TELECOM & ORS.