Ms Shiv Engineers And Traders And Others vs Post Graduate Institute Of Medical Education And Research And Others

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CWP-20634 of 2026 (O&M)


IN THE HIGH COURT OF PUNJAB & HARYANA
AT CHANDIGARH


CWP-20634 of 2026 (O&M)


Reserved on: 07.10.2026
Pronounced on: 05.11.2026
Uploaded on 06.11.2026

Whether only operative part of the judgment is
pronounced or the full judgment is pronouned: Full judgment


M/S SHIV ENGINEERS AND TRADERS AND OTHERS

…..Petitioners

V/S


POST GRADUATE INSTITUTE OF MEDICAL EDUCATION AND
RESEARCH AND OTHERS.



… Respondents


CORAM: HON'BLE MR. JUSTICE SUVIR SEHGAL
HON'BLE MR. JUSTICE RAJESH GAUR

Present: Mr. Aman Bahri, Senior Advocate with
Ms. Anjali, Advocate and
Mr. Karanveer Bawa, Advocate for the petitioners.

Mr. Avinit Avasthi, Advocate for respondents.





RAJESH GAUR, J.


1. Present petitioners are contractors engaged in repair and
maintenance of Manifold Services and Medical Gas Pipeline Systems and have
been providing the said services at Post Graduate Institute of Medical Education
and Research, Chandigarh (for short ‘PGIMER, Chandigarh). The petitioners
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CWP-20634 of 2026 (O&M)


have challenged the issuance of cancellation of the tender dated 16.01.2026
(Annexure P-2) and fresh tender order dated 17.06.2026 (Annexure P-10) by the
respondents/authorities.

2. The tender conditions in the former tender prescribed certain
mandatory eligibility criteria, inter alia, requiring every bidder to possess at least
five years’ experience in repair and maintenance of Manifold Services and
Medical Gas Pipeline Systems (MGPS) in Government or reputed Private
Hospitals having a minimum capacity of 500 beds. The relevant eligibility
conditions, which are the subject matter of the challenge, are reproduced in bold
below:-
“ELIGIBILITY CRITERIA FOR APPLYING

a) The bidder has to be a registered company/agency involved in
providing repair and maintenance services for Manifold
services for Manifold Room and Medical Gas pipeline system
on contract basis to the Govt. or reputed Private Hospital of
minimum 500 beds.

b) The agency must have an experience of minimum five years
(as on 31.03.2025) for providing repair and maintenance
services on contract basis in minimum 500 bedded Govt, or
reputed Private Hospitals.

c) The bidder company/ agency should never have been Black
listed by any Government organization. Affidavit this regard to
be submitted.

d) Annual turnover of agency in last 3 yrs consistently. Should not
be less than 1 crore as per year Copy of certificate from CA to
be attached in support up to 31 march 2025.
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e) Name and address of organization and their technical
employees.

f) Whether proprietary/ partnership/company/Pvt. Ltd.
(Supported by document).

g) The bidder should have all tools and tackles for the repair and
maintenance for the said work.

h) The firm must have proper well equipped workshop/office in
tricity Chandigarh to cater fro repair/ services with qualified
technical support team and test & tooling infrastructure.
Documentary Proof of the existence of the same has to be
submitted with address proof.

i) Authorization Certificate from the service provider company for
bidding is to be submitted by authorized person.

j) PAN & GST number shall be furnished (Enclosed the last paid
GST details with documents for 1 years).”


3. Petitioners’ claims that prescribed eligibility conditions are
mandatory to ensure the technical competence, financial capability and requisite
experience of the bidder in safety, critical relating to medical gas system. It has
been averred that respondent no. 6 lacked the requisite qualification and
experience and, therefore, was ineligible, but, respondent no.6, was declared
technically qualified, despite not fulfilling the mandatory eligibility criteria.

4. Aggrieved thereby, petitioners filed Civil Writ Petition bearing no.
7952 of 2026, which was disposed of vide order dated 17.03.2026, with a
direction to respondents/authorities to consider and decide the legal notice
submitted by petitioners, after affording an opportunity of hearing to all the
affected parties.
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5. In compliance of the aforesaid order, the Manifold Committee
cancelled the entire tender process dated 16.01.2026, citing ambiguity in the
interpretation of the eligibility conditions. Thereafter, respondents/authorities
issued a fresh tender process (Annexure P-10) with revised eligibility criteria.
The relevant revised conditions, which are the subject matter of the challenge,
are reproduced in bold below:-
“ELIGIBILITY CRITERIA FOR APPLYING :

a) The bidder has to be a registered company (Proprietary/
Partnership/ Pvt. Ltd./Limited)/agency. (Supported by
document).

b) The work is estimated to cost approximately Rs.1,45,80,400/-
The tender should have satisfactorily completed similar works
as mentioned below during the last two years ending last day of
the month previous to one in which tender are invited.
Three similar works of each of costing not less than Rs. 40%
OR Two similar work each of cost not less than Rs. 60% OR
One similar work each of cost not less than Rs 80% of the
estimated cost mentioned above. (Similar work means: SITC/
Repair & Maintenance of Medical Gases Pipeline System)
(Along with Completion Certificate.
The value of executed works shall be brought to current costing
level by enhancing the actual value of work at simple rate of 7%
per annum; calculated from the date of completion to previous
day of last date of receipt of applications for bids.
The completion certificate should be certified by an officer not
below the rank of Executive Engineer/Project
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Manager/General Manager of a firm/owner for whom the work
is executed.
If private works are shown in support of eligibility, certified
copy of the tax deducted at source certificate (TDS) shall be
submitted along with the experience certificate and the TDS
amount shall tally with the. actual amount of work done.

c) The bidder has to provide an experience of minimum five
years (as on submission of tender documents) with experience
in SIT/Repair & Maintenance of Medical Gases Pipeline
System.

d) The above (c) experience should be in minimum 300 bedded
Govt. or reputed Private Hospitals in any part department
Centre of it.

e) The above (b) & (c) experience should be in any part of
Medical gas pipeline system involves Medical Oxygen, Nitrous
oxide, carbon dioxide, Medical Air supply system, Medical
Vacuum (Suction) supply System and Anaesthetic Gas
Scavenging system along with related Automatic Control
Panels, Distribution Piping, Valves, Alarm System, Gas
Outlets, Bed Head Panels etc.

f) The bidder company/ agency should never have been: Black
listed by any Government organization. Affidavit in this regards
to be submitted.

g) Annual turnover of agency in last yrs consistently. Should not
be less than 1 crore as per year Copy of Certificate from CA to
be attached in support up to 31 march 2026.

h) Name and address of organization and their technical
employees.

i) The bidder should have all tools and tackles for the repair and
maintenance for the said work.
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j) The firm must have proper well equipped workshop office in
tricity (Chandigarh, Mohali & Panchkula) to cater for repair/
services with qualified technical support team and test &
tooling infrastructure. Documentary Proof of the existence of
the same has to be submitted with address proof.

k) The bidder has to submit valid inline service authorization
from Ingersoll rand and Trident pneumatics.

l) PAN & GST number shall be furnished (Enclosed the last paid
GST details with documents for I years)”


6. Hence the present petition.

7. Learned Senior Counsel appearing for the petitioners contends that
the revised tender conditions have diluted the eligibility criteria by reducing the
requisite experience from manifold services in hospitals having 500 beds to
those having 300 beds and by replacing the requirement of experience in
manifold rooms and medical gas pipeline system with experience in any part of
medical gas pipeline systems. It is further contended that the specific
requirement of experience in medical manifold rooms has been dispensed with
and separate experience in individual service has been stipulated. He further
submits that these material alterations have been made to suit respondent no.6.
According to petitioners, influence exerted by respondent no.6 is reinforced by
the cancellation of the earlier tender, which involved the same scope of work,
on the purported ground of ambiguity in the interpretation of the tender
conditions, despite there being no such ambiguity. The petitioners have also
challenged the newly introduced conditions i.e. clause (k) requiring
authorization from either of the two specified companies, namely Ingersoll Rand
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and Trident Pneumatics on the ground that that it is restrictive and confers an
undue advantage upon respondents no. 6 and denies other eligible bidders a level
playing field.

8. Learned Senior Counsel appearing for the petitioner has placed
reliance upon the judgment of the Hon’ble Supreme Court in ‘Subodh Kumar
Singh Rathour Vs. The Chief Executive Officer and others’, 2024 (15) SCC
461 ; ‘Mohinder Singh Gill and another vs. The Chief Election Commissioner,
New Delhi and others’, 1978 (1) SCC 405 and ‘Triveni Healthcare Private
Ltd. Vs. Govt. of NCT of Delhi and others’, Law Finder Doc ID: 2011740

9. Initially, a short reply dated 16.07.2026 was filed on behalf of
respondents no.1 to 5, stating that the petitioners alone had been providing
annual maintenance contract services for the Medical Gas Pipeline System
(MGPS) at PGIMER, Chandigarh, for the preceding 20 years and that there had
been no competing bidder. Accordingly, with a view to ensure wider
participation and eliminate ambiguity, fresh conditions relating to similar works
were incorporated, and the minimum beds requirement was reduced from 500
to 300.

10. The restriction concerning manufacturer authorisiation was
justified on the ground that the majority of critical equipment installed at
PGIMER, Chandigarh, belonged to the two specified manufacturers. It is further
submitted that out of the 09 Committee members, only 06 had signed the
minutes of the meeting, whereas the remaining three members had not attended
the meeting and therefore, the decision was supported by a two-thirds majority.
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In response thereto, petitioners filed an additional affidavit asserting that the
majority of machines currently in used were not manufactured by Trident or
Ingersoll Rand company. Rather, according to the petitioners, existing
infrastructure comprised equipment from different manufacturers and did not
pre-dominantly represent the products of the aforesaid manufacturers.

11. A written statement was separately filed controverting the
petitioners’ submissions, wherein, it was contended that the Ingersoll Rand
compressors employ compressor technology, which is stated to be of a superior
quality. Thereafter, vide order dated 10.08.2026, the Hon’ble Court directed the
respondents to file an additional affidavit furnishing justification for the
cancellation of the first tender process. An additional affidavit dated 19.08.2026
was filed annexing therewith minutes of the meeting dated 14.08.2026

12. The principal submissions made in the said additional affidavit are
summarized as follows:-

(i) The Committee found that the petitioner’s interpretation of the
experience requirement concerning manifold services to be unduly
restrictive. It is observed that such an interpretation would defeat
the very object of tender, namely, to ensure fair and healthy
competition. The Committee further recorded that the petitioners
had been providing the services for the preceding 20 years and that
the restrictive interpretation adopted by the petitioners had
prevented the respondents from finalizing the tender. It was,
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therefore, observed that the relevant clauses in earlier tender lacked
clarity and were susceptible to ambiguity.

(ii) It was further contended that, in the absence of a concluded
contract, a bidder does not acquire any vested right to have the
tender fianlised in its favour. The competent authority retains the
power to cancel the tender or reject the bids, provided that such
action is founded upon valid and cogent reasons.


13. We have heard learned Senior Counsel appearing for the
petitioners as well as counsel for the respondents and have perused the record
with their able assistance.

14. Upon examination of the contentions raised by both the parties, we
find that the Committee observed that the petitioners had adopted a narrow and
restrictive interpretation of the requirement of five years’ experience in
manifold services by construing the same to mean five years’ experience in each
individual service, such as, compressors, drives, control panels, pipelines etc.
The petitioners have contended in their representation that the respondent no. 6
did not possess five years’ experience in each of the aforesaid services.
However, the Committee found that the eligibility criteria did not expressly
stipulate separate five years’ experience requirement for each individual
services. Accordingly, the Committee, considered it necessary to cancel the
Notice Inviting Tender (NIT) dated 16.01.2026, as clauses (a) and (b) of the
eligibility criteria did not clearly define the scope of experience required in
manifold services. The Committee further observed that the petitioner’s
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interpretation of the eligibility criteria would defeat the objective of ensuring
fair and healthy competition in the tendering process for manifold services at
PGIMER, Chandigarh.
14.1 Insofar as the relaxation of the eligibility criterion relating to
experience in hospitals having a minimum of 500 beds to those having 300 beds,
equipped with a medical gas pipeline system, is concerned, this Court finds such
relaxation to be reasonable and justified. The modification is intended to
broaden the pool of eligible bidders, promote healthy competition and prevent
monopolistic pricing, without compromising the technical competence or
experience required for the execution of the contract. Significantly, the
operation and maintenance of a medical gas pipeline system involves multiple
critical services, including oxygen, nitrous oxide, vacuum and medical
compressed air supply lines. The technical expertise, regulatory compliance,
engineering precision and safety protocols required for managing such systems
in a 300-bed hospital are substantially similar to those required in a 500-bed
hospital. A contractor possessing the requisite experience in maintaining these
systems in a 300-bed multispecialty hospital can reasonably be regarded as
having the technical capability, qualified personnel and operational expertise
necessary to undertake similar responsibilities in a larger healthcare facility. It
is well settled that eligibility conditions in public procurement must bear a
rational nexus with the nature and requirements of the work and should not be
unnecessarily restrictive or exclusionary. Insistence upon prior experience
exclusively in hospitals having 500 beds or more, notwithstanding comparable
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technical requirements, may unduly restrict competition. Conversely, reducing
the threshold to 300 beds, while retaining the requirement of experience in
handling multiple medical gas services, enlarges the scope of participation
without diluting the essential technical standards. Such relaxation is conducive
to competitive bidding, cost-effectiveness and optimal utilisation of public
funds. Consequently, the impugned modification cannot, merely on account of
the reduction in the prescribed bed capacity and expansion of services, be
characterised as arbitrary, discriminatory or tailor-made to favour any particular
bidder.

15. In the case of ‘Principal Chief Conservator of Forests and others
v. Suresh Mathew and others’, 2025 AIR SC 2118 , the Hon’ble Supreme Court
has recognized that the decision of the competent authority to cancel a tender
and initiate a fresh tendering process affords all interested bidders an equal
opportunity to compete. Such a decision, in the absence of arbitrariness or mala
fides, cannot ordinarily be said as being adverse to public interest; rather, it may
advance public interest by promoting fairness, transparency and healthy
competition in the tendering process.

16. In the present case, no vested right has accrued in favour of the
petitioners and process never ripened into a concluded contract. Until a bid is
accepted, there is no binding contract, and the respondents were, therefore at
liberty to cancel the Notice Inviting tender. Moreover, the eligibility criteria in
clause (a) and (b) of the NIT dated 16.01.2026 were found to be vague,
ambiguous and opaque. The cancellation of this was founded on a bona fide
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need to rectify the tender conditions, and is not tainted by illegality, arbitrariness
and preferential treatment.

17. The Hon’ble Supreme Court in the case of ‘Indore Vikas
Praadhikaran (IDA) and another Vs. Shri Humud Jain Samaj Trust and
Another’ , 2025 AIR SC 322 , has held that in the absence of a concluded
contract, a bidder has no vested right to insist that the auction be concluded in
its favour. The competent authorities have the discretion to cancel the auction
or reject the bids, provided such discretion is exercised for valid and cogent
reasons in accordance with law.

18. The reliance placed by the petitioners upon Subodh Kumar Singh
Rathour’s case (supra) is erroneous as the said judgment is clearly
distinguishable on facts. In the said case, pursuant to the NIT, a work order had
been issued in favour of the appellant and who had been commenced execution
of work in terms of the contract. It was only thereafter, at the behest Minister-
in-charge, that the notice for cancellation of tender was issued despite vested
contractual rights having accrued in favour of the appellant and personal
investment has been made by him.

19. Further, in the said case, allegations of mala fides were leveled
against the minister-in-charge, and the decision to cancel the tender was found
to have been taken without application of mind in a capricious manner and under
the influence of malice. In contrast, in the present case, no allegations of mala
fides have been leveled against the answering respondents. Further, no
concluded contract has come into existence between the petitioner and the
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respondents, nor any vested contractual rights have accrued in favour of the
petitioner.

20. In these circumstances, petitioner cannot claim an indefeasible
right to the award of the contract and the decision to cancel the earlier tender
cannot be assailed on the grounds which were found attracted in Subodh Kumar
Singh Rathour’s case (supra).

20.1 The next reliance placed upon by petitioners on the judgement of
Mohinder Singh Gill’s case (Supra) is indefensible as well, as it pertains to
elections in a parliamentary constituency of Punjab for the year 1977. Even the
specific paragraph 8 as emphasized on by the petitioner revolves around a public
order made by way of an affidavit, whereas the present case delves upon a public
tender which is different from a public order. More notably the order in the case
of Mohinder Singh Gill was made during a politically tense scenario when the
elections in the aforementioned constituency became a direct threat to the
democracy of the country, which is not the position in regards to the public
tender in the present case.

20.2 Further the petitioner’s reliance upon the judgement in Triveni
Healthcare’case (Supra) is also untenable, as the ratio in that judgement is laid
out on a different factual matrix. While both the tenders in the case of Triveni
Healthcare and in the present case, operate parallelly with respect to
procurement and maintenance of crucial medical equipment, respectively,
however in case of the former, the aforementioned equipment were being
procured for installation in a medical institution having witnessed a
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considerably higher death rate in its recent past. This justified the authority’s
decision therein, for not relaxing the eligibility requirement of past experience
keeping in mind the safety and welfare of the patients, and as elucidated in
concluding paragraphs of the judgement, the peculiar nature of work and
especially the death rate in the hospital. The present case unfolds no facts of
such grave consideration.

20.3 Additionally, Rule 173 of the General Financial Rules 2017,
promotes fair, transparent, and competitive procurement, requiring equal
opportunities for all eligible bidders. Subrule (xix) of rule 173 virtually bars
monopolistic practices by ensuring that the bids may be rejected when an
effective competition is lacking, thereby safeguarding bidders against arbitrary
decisions and ensuring a level playing field. Furthermore Section 4 of the
Competition Act, 2002 as well debars an enterprise from abusing their dominant
position by restricting market access to their competitors.

20.4 Accordingly, the judgments relied upon by the petitioner are
distinguishable and does not advance his case.

21. In the case of ‘ State of Jharkhand and others Vs. M/s CWE-Soma
Consortium, 2016 AIR SC 3366 , the Hon’ble Supreme Court has held that, in
matters relating to tender, the authority issuing the tender notice is under no
obligation to accept any of the tender, including the lowest tender. Upon
examining the rates quoted and the status of participating contractors, the
authority finds that there is no effective competition, it is well within its rights
to decide not to enter into the contract and to cancel the tender process.
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22. It is a settled position of law that, until the bid is accepted, even the
highest bidder does not acquire any vested right to have the auction concluded
in his favour. The appellant therein was, therefore, well within their rights to
reject the bid of the respondents without assigning any reasons thereof.

23. The Supreme Court of India in ‘ Afcons Infrastructure Ltd. Vs.
Nagpur Metro Rail Corporation Ltd. And another’, 2016 (16) SCC 818 has
held that, in matter relating to tenders, a mere disagreement with the decision
making process or the decision of the authority does not, by itself, warrant
interference by a constitutional court. The threshold for interference is met only
where mala fides , an intention to favour someone, arbitrariness, irrationality or
perversity is established. The Hon’ble Supreme Court further held that the
employer, having authored the tender documents is best suited to understand its
requirements and interpret its term. Accordingly, a constitutional court must
defer to the employer’s understanding and application of the tender conditions,
unless, mala fides , perversity or arbitrariness is established in such
understanding or application.

24. There is a rationale behind incorporating a clause in the DNIT
restricting manufacturer authorization. The majority of the critical equipment
installed in the medical gas manifold system is manufactured by two
manufacturer, necessitating appropriate safeguards to secure the availability of
valid authorization or restricted Original Equipment Manufacturers (OEMs).

25. In the case of ‘ M/s Jyoti Electricals and another Vs. Post
Graduate Institute of Medical Education & Research (PGIMER),
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Chandigarh and others, CWP No. 39639 of 2025, decided on 24.03.2026 , this
Court had already examined the issue of uploading and
undertaking/authorization issued by the OEMs. The Court held that requirement
for submission of an undertaking or an authorization certificate from the OEMs
was significant, as none of the bidders was the manufacturers of the equipment
proposed to be supplied and installed. Consequently, in the absence of
authorization from the OEMs whose equipment, the bidders intended to supply
and install, acceptance of their bid should have been meaningless.

26. In view of above facts and circumstances and the different clauses
of the tender document, interference is not warranted in the present petition.
Accordingly, present petition is dismissed.

27. All pending civil miscellaneous application(s), if any, shall also
stand disposed of.

(SUVIR SEHGAL) (RAJESH GAUR)
JUDGE JUDGE


05.11.2026
Kamal Gandhi


Whether speaking Yes

Whether reportable Yes
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