M/S Leotech Process vs The Union Of India And 5 Ors
- Court
- Gauhati High Court
Page No.# 1/31
GAHC010141142026
2026:GAU-AS:12583
THE GAUHATI HIGH COURT
(HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
Case No. : WP(C)/3587/2026
M/S LEOTECH PROCESS
A PROPRIETORSHIP FIRM HAVING ITS PLACE OF BUSINESS AT BLOCK
NO. C4, PLAT NO. 136, NEW AUTO NAGAR, KANURU, VIJAYAWADA-52000
ANDHRA PRADESH, REPRESENTED BY ITS AUTHORISED
REPRESENTATIVE, JAKIR HUSSAIN.
VERSUS
THE UNION OF INDIA AND 5 ORS
REPRESENTED BY THE SECRETARY, TO THE DEPARTMENT OF RAILWAYS,
256-A, RAISINA ROAD, RAJPATH AREA, CENTRAL SECRETARY, NEW
DELHI-110001
2:THE NORTH EAST FRONTIER RAILWAY
REPRESENTED BY THE GENERAL MANAGER
NORTH EAST FRONTIER RAILWAY
GUWAHATI
MALIGAON
KAMRUP (M)
ASSAM.
3:THE GENERAL MANAGER
NORTH EAST FRONTIER RAILWAY
GUWAHATI
MALIGAON
KAMRUP (M)
ASSAM.
4:THE PRINCIPAL CHIEF ROLLING STOCK ENGINEER
NORTH EAST FRONTIER RAILWAY
Page No.# 2/31
GUWAHATI
MALIGAON
KAMRUP (M)
ASSAM.
5:THE SENIOR DIVISIONAL MECHANICAL ENGINEER
LUMDING DIVISION
NORTHEAST FRONTIER RAILWAY
DRM OFFICE COMPLEX
LUMDING 782447
6:ROSE VENTURES AND M/S THARU AND SONS JOINT VENTURE
HAVING ITS OFFICE AT PARAC BUILDING
C/O THARU SONS
KATIPAYIROAD
RAJAGIRI
P.O. SOUTH KALAMASSERY
ERNAKULAM DISTRICT- ERNAKULAM
KERALA-68310
BEFORE
HONOURABLE MR. JUSTICE DEVASHIS BARUAH
For the Petitioner(s) : Mr. R. Dubey, Advocate
For the Respondent(s) : Ms. R. Deka, CGC
Mr. G. Rahul, Advocate
Date on which Judgment was reserved : N/A
·
· Date of Pronouncement of Judgment : 27.08.2026
· Whether the pronouncement is of
the Operative Part of the Judgment : No
· Whether the full Judgment has been
Pronounced : Yes
JUDGMENT AND ORDER (ORAL)
Heard Mr. R. Dubey, the learned counsel appearing on behalf of
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the Petitioner. Ms. R. Deka, the learned CGC appears on behalf of
the Respondent Nos. 1 to 5 and Mr. G. Rahul, the learned counsel
appears on behalf of the Respondent No. 6.
PREFACE
2. The present writ petition has been filed by the Petitioner
challenging the decision of the Respondent Authorities to hold the
Petitioner’s bid technically non-responsive for two reasons, i.e.:
(i) The Banking Reference Certificate which is required to
be submitted by the Petitioner, though submitted, was not
certified by a Chartered Accountant with stamp, signature,
and membership number.
(ii) The Petitioner did not have the technical
experience/competence of setting up a Mechanized Laundry
of minimum capacity of 4 tonnes of linen per shift while
washing minimum of 4 tonnes of linen per shift for a
continuous period of 12 months in the qualifying period, i.e.,
the current year and the 3 previous financial years.
3. This Court is therefore called upon to adjudicate, while
exercising the powers of judicial review, as to whether the decision
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of the Respondent Authorities to reject the Petitioner’s technical bid
is required to be interfered with.
BRIEF FACTS OF THE CASE ALONGWITH THE
PROCEEDINGS LEADING TO THE PRESENT JUDGMENT
4. The Respondent No. 5 had floated a Notice Inviting Tender
No. Mech-LMG-ET-14-2025-26 dated 19.02.2026 whereby bids
were invited from eligible bidders for execution of the work,
“Turnkey Contract for the Supply, Installation, Commissioning of
Plant/Equipment & Related Infrastructure and Operation of
Mechanized Laundry at Badarpur, Collection of soiled linen from
coaches from Agartala, Silchar and Sairang Railway Stations and
loading of washed linen into coaches at Agartala, Silchar and
Sairang Railway Stations for a period of 10 years under the BOOT
(Build-Own-Operate-Transfer) basis and transportation of linen
from BOOT Laundry to nominated stations, including onboard
distribution of linen to passengers, blanket repairs & stitching of
curtains.”
5. The said Notice Inviting Tender stipulated various Eligibility
Conditions. There were Special Financial Criteria as well as Special
Technical Criteria. The Special Technical Criteria, more particularly,
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at Serial Nos. 1 and 2, being relevant, is reproduced hereinunder:
S.N
Description Confirmation
Remarks
Documents
o.
Required
Allowed
Uploading
1 As proof of technical experience /competence, the
No No Allowed
tenderer(s) must satisfy the following criteria:
(Mandatory)
Should have Setting up a Mechanised Laundry of
minimum capacity of 4 Tonnes of linen per shift
while washing minimum of 4 tonnes of linen per
shift for a continuous period of 12 months in the
qualifying period, i.e., current year and three
previous financial years. In the case above,
laundry services should have been rendered to
one or more of the following
establishments/clients: i) Three star hotels and
above in India approved by Ministry of Tourism,
Govt. of India. ii) Any hospital in India with
minimum of 100 bed capacity. iii) Corporate entity
in India with an annual turnover of at least Rs.500
crores. iv) Any Airlines in India under DGCA. v)
Indian Railways. vi) Indian Central/State Govt.
/PSU establishment/Central or State Govt.
Undertakings.
2 Definition of Similar Work: Should have Setting up
No No Allowed
a Mechanised Laundry of minimum capacity of 4
(Mandatory)
Tonnes of linen per shift while washing minimum
of 4 tonnes of linen per shift for a continuous
period of 12 months in the qualifying period, i.e.,
current year and three previous financial years. In
the case above, laundry services should have
been rendered to one or more of the following
establishments/clients: i)Three star hotels and
above in India approved by Ministry of Tourism,
Govt. of India. ii)Any hospital in India with
minimum of 100 bed capacity iii)Corporate entity
in India with an annual turnover of at least Rs.500
crores. iv)Any Airlines in India under DGCA.
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v)Indian Railways. vi)Indian Central/State Govt.
/PSU establishment/Central or State Govt.
Undertakings. Details for the conditions of
Liquidity mentioned in the Tender Document
Technical Criterion Clause No. 1.1.
( Click here to download Format)
6. In addition to the said Notice Inviting Tender, there were
various other details which have been specifically mentioned in the
e-tender document. Amongst these, Part-I of the e-tender
document is under the heading “System of Tendering” (for short,
“the SOT”).
7. Clause 1.0 of the SOT is under the heading “Eligibility Criteria”.
Clause 1.1 relates to the “Technical Criterion”. The said Clause 1.1
is relevant, along with the Note attached thereto. However, for the
purpose of the present dispute, Clauses (i), (ii), (iii), (vi) and (vii)
are relevant. Accordingly, Clause 1.1 and Clauses (i), (ii), (iii), (vi)
and (vii) of the SOT are reproduced hereinunder:
“ 1.1 Technical Criterion:
As proof of technical experience/competence, the tenderer(s) must satisfy the
following criteria:
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Should have Setting up a Mechanised Laundry of minimum capacity of 4
Tonnes of linen per shift while washing minimum of 4 tonnes of linen per
shift for a continuous period of 12 months in the qualifying period, i.e.,
current year and three previous financial years.
In the case above, laundry services should have been rendered to
one or more of the following establishments/clients:
i) Three star hotels and above in India approved by Ministry of Tourism,
Govt. of India.
ii) Any hospital in India with minimum of 100 bed capacity.
iii) Corporate entity in India with an annual turnover of at least Rs.500
crores.
iv) Any Airlines in India under DGCA.
v) Indian Railways.
vi) Indian Central/State Govt. /PSU establishment/Central or State Govt.
Undertakings.
Work done for Private individual shall not be considered.
NOTE:
(i) For the purpose of Technical Criterion above, a Mechanised Laundry
"Unit" shall mean a Laundry facility installed in a single premise.
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(ii) For substantiating the requirement of having washed at least an average
quantity of 4 Tonnes of linen per shift in one site for a continuous period of
12 months in the qualifying period i.e. current year and three previous
financial years, the tenderer(s) shall be required to furnish documentary
evidence as per ANNEXURE-XII certified by one or more institutional clients
mentioned in Para 1.1 above. It shall be noted that only information
submitted in the Annexure XIII will be considered. Documents in any other
forms like Letter of acceptance, completion certificate etc. shall not be
considered.
(iii) For the laundry of minimum capacity of 4 Tonnes of linen per shift in
one site which the average quantity of 4 Tonnes per shift has been washed
for at least one year, the tenderer should submit information as per
Annexure – XII (A).
(iv)…………….
(vi) Tenderer shall submit "satisfactory performance certificate" from some
of the major institutional clients.
(vii) Railway shall reserve the right to seek independent confirmation of
credentials submitted by the tenderer from the respective issuing agencies
about the satisfactory performance of the work. Tenderer shall submit bills
and other verifiable documents establishing that they fulfill the above
technical eligibility criteria.”
8. It is also of relevance that below the Clauses and the Note
reproduced hereinabove, another Note has been stipulated which
being relevant, is reproduced hereinunder:
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“ Note:
· Capacity of 4 Ton shall mean the capacity of 4 Ton linen per shift. This
shall be reckoned as the output of the main washing equipment in the
laundry (washer-cum-extractor or tunnel washer) in a shift of 8 hrs. i.e. 24
hours. Tenderer has to submit the documents to prove that he has
operated/installed minimum 4 Ton capacity laundry per shift.
· Tenderer shall submit "satisfactory performance certificate" from some of
the major institutional clients. Railway reserves the right to seek
independent confirmation of the credentials submitted by the Tenderer from
the respective issuing agencies about the satisfactory performance of the
work.”
9. Clause 1.3 of the SOT is the “Financial Criterion”. Sub-Clause A
relates to “Annual Turnover” and Sub-Clause B stipulates the
“Liquidity”. Clause 1.3, along with Sub-Clauses A and B and the
Note are reproduced hereinunder:
“ 1.3. Financial Criterion :
The tenderer(s) shall satisfy the following financial criteria:
A. Annual turnover : The bidder should have an aggregate financial turnover not
less than 1.5 times the advertised Bid value during the last three previous financial
years and in the current financial year up to the date of opening of the tender. The
audited balance sheet reflecting financial turnover certified by chartered
accountant with her stamp, signature and membership number shall be
considered. Bidders shall submit the requisite information as per (To be submitted
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as per Annexure-XIX).
The tenderers shall submit requisite information along with copies of Audited
Balance Sheets duly certified by the Chartered Accountant/Certificate from
Chartered Accountant duly supported by Audited Balance Sheets.
For tenders with opening date between April to September months, Certificate
from Chartered Accountant issued on the basis of Government approved
documents like GST Returns/VAT Statement to ascertain financial turnover of the
latest financial year shall be considered, in terms of Railway Board File No.
2016/EnHM/06/02 dated 18.10.2018.
B. Liquidity : The bidder should have access to or has available liquid assets, lines
of credit and other financial means to meet cash flow that is valued at 5% of the
estimated bid value net of applicant's commitments for other contracts. (To be
submitted as per Annexure-XX & Annexure-XXI).
The audited balance sheet and/or banking reference certified by chartered
accountant with her stamp, signature and member ship number shall be submitted
by the bidder along with the bid. Banking reference should contain in clear terms
the amount that bank will be in a position to lend for this work to the applicant
/member of the Joint venture/consortium. In case the net current assets (as seen
from the balance sheets) are negative only the banking references will be
considered. Otherwise aggregate of the net current assets and submitted banking
references will be considered for working out the liquidity.
The banking reference should be from a scheduled bank in India and it should not
be more than 3 months old as on date of submission of bids.
In case of JV firms overall liquidity of JV firm shall be assessed by arithmetic sum
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of liquidity of all members of JV.
Note:
1) It shall be noted that wherever, the certificate from the Chartered Accountant is
mentioned, the Chartered Accountant should be the same who normally audits the
accounts of the company.
2) In order to arrive at the Total Contract amount received during the last three
financial years and in the current financial year in case of a JV firm, Total Contract
amount received by the JV Firm or the arithmetic sum of contractual payments
received by all the members of JV Firm in the previous three financial years and
the current financial year up to the date of opening of tender shall be at least
150% of the advertised tender value of the work.
The "financial capacity" of the lead member of JV shall not be less than 51% of
the financial eligibility criteria.
3) Contractual payment received by a Member in an earlier JV Firm shall be
reckoned only to the extent of the concerned member's apportioned share in that
JV firm for the purpose of satisfying compliance of the above mentioned financial
eligibility criterion in the tender under consideration.”
10. Clause 1.4 of the SOT stipulates the “System of Tendering”
and it is envisaged therein that a two packet system of tendering
shall be adopted for the work and on the due date of opening, only
the technical bid will be opened for scrutiny to ascertain the
suitability of the tenderers for the work. However, the financial bid
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of only those tenderers would be opened who qualify in the
Technical Bid. It is also stipulated that the Earnest Money Deposit
of tenderers who do not qualify as per the contents of the technical
bid shall be returned to them after finalization of the tendering
process.
11. Clause 1.4.1 of the SOT stipulates what the technical bid
should comprise off. Sub-Clause (vi) of Clause 1.4.1.1 of the SOT is
of relevance and the same is reproduced hereinunder:
“ vi. List of similar works completed/on going in the qualifying period (i.e. current
year and three previous financial years) should be provided as per Annexure-II &
Annexure-III. Supporting documents / certificates from the organizations for which
the tenderer(s) have worked should be enclosed. The authorized signatory of the
organization should sign the certificates submitted by the tenderer(s). Certificates
from private individuals for whom such works were executed shall not be accepted.”
12. Clause 1.4.1.2 of the SOT specifically refers to the “Financial
Bid” and what it should contain. It is stipulated therein that a
Financial (Price) bid shall consist of the schedule of rates, i.e., the
unit cost offered by the tenderer for washing various items of linen.
13. In the backdrop of the above, it is relevant to take note of that
the Petitioner along with the Respondent No. 6 and other bidders
participated in the said tender process. On 30.06.2026, the
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Petitioner came to learn that the Petitioner’s technical bid was
rejected by the Respondent Authorities as non-responsive technical
bid and the same was uploaded on 01.07.2026. The Petitioner
immediately submitted representations on 30.06.2026 and
01.07.2026.
14. It is the case of the Petitioner that only the bid of the
Respondent No. 6 was considered technically responsive and as
such, the financial bid of Respondent No. 6 was opened and
uploaded on the portal of the Railway Authorities which indicates
that the net offered rate value given by the Respondent No. 6 was
Rs. 216,91,17,693.42p.
15. Being aggrieved by the rejection of the Petitioner’s bid, the
Petitioner approached this Court by filing the present writ petition
on 06.07.2026. The learned Coordinate Bench of this Court vide an
order dated 09.07.2026 issued notice but was not inclined to pass
any interim directions. However, subsequently, when the writ
petition was listed before this Court on 15.07.2026, this Court,
taking into account the respective submissions was of the opinion
that the Petitioner was able to make out a prima facie case for
grant of interim directions. Accordingly, this Court passed an
interim direction to the effect that till the next date, no further
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steps should be taken by the Respondents Nos. 1 to 5 to grant the
contract to any party.
16. The Respondent Nos. 1 to 5 filed the affidavit-in-opposition on
15.07.2026 itself wherein it was mentioned that the NIT specifically
required that the bidder should have experience of setting up a
Mechanized Laundry of minimum capacity of 4 tonnes of linen per
shift and should have washed a minimum of 4 tonnes of linen per
shift for a continuous period of 12 months during the qualifying
period. Such laundry services should have been rendered to one or
more of the establishments specifically enumerated in the NIT,
namely hotels, hospitals, corporate entities, airlines, Indian
Railways, Central/State Government establishments or PSUs and
documentary evidence in support of the above requirement was
mandatorily required to be furnished in the format prescribed in
the relevant Annexures to the tender document.
17. It was further mentioned in the said affidavit-in-opposition that
in the said tender process, the Petitioner and the Respondent No. 6
had participated. The Tender Committee, upon scrutiny of the bid
documents submitted by the Petitioner, found that the Petitioner
failed to submit valid and sufficient documents proving fulfillment
of the prescribed Technical Eligibility Criteria and also failed to
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establish execution of works conforming to the definition of “similar
nature of work” as required by the NIT and accordingly, having
found the Petitioner’s bid non-responsive. The rejection of the
Petitioner’s technical bid was for the following deficiencies i.e.
a) Failure to submit documents establishing compliance with
the prescribed Technical Eligibility Criteria;
b) Failure to submit documents proving execution of works
conforming to the prescribed definition of “similar nature of
work”;
c) Failure to submit valid documents establishing liquidity in
terms of the tender conditions, particularly the mandatory
requirement of the Chartered Accountant certification of the
banking reference.
18. It was further mentioned in the said affidavit-in-opposition
that the experience certificate which was submitted by the
Petitioner dated 13.06.2025 issued by the Office of the Director of
Medical Education, Vijayawada could not be taken as the
experience certificate, as the certificate did not mention setting up
and operating a Mechanized Laundry within the scope of the work.
It was mentioned that under such circumstances, the Petitioner
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could not be treated as experienced in a similar nature of work as
stipulated in the tender conditions. It was further mentioned that
as regards the eligibility criteria, the bidder was required to furnish
a liquidity amount duly certified by the Chartered Accountant
equivalent to 5% of the advertised tender value of Rs.
9,11,39,398.88p. However, the Petitioner submitted its liquidity
amount of Rs. 7,15,89,187/-. The Petitioner though relied upon the
banking reference of Rs. 9.11 crores, but the same was not
certified by the Chartered Accountant, though such certification
was mandatory requirement under the tender condition.
19. The Respondent No. 6 had filed an affidavit-in-opposition
wherein it was mentioned that there was no infirmity in the
rejection of the Petitioner’s technical bid, inasmuch as the
certificates which the Petitioner had submitted did not establish
that the Petitioner had set up, installed and commissioned a
Mechanized Laundry facility which is a mandatory requirement of
the tender condition. It was further mentioned in the said affidavit-
in-opposition that the tender in question is a BOOT (Build-Own-
Operate-Transfer) project involving the establishment of an entirely
new Mechanized Laundry facility together with the installation,
commissioning and operation of sophisticated machinery and allied
infrastructure. Consequently, prior experience in merely washing
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linen using an existing facility cannot be equated with the
experience of setting up a Mechanized Laundry as specifically
mandated in the tender. It was further mentioned that the
Petitioner, though relied upon Annexures-XII, XII(A), XII(B) and
XII(C) of the tender document but failed to show that it had
submitted the mandatory documents in terms with Annexure-II of
the tender document, which stipulates the bidder’s list of similar
works completed during the qualifying period (Clause 1.1).
20. The Petitioner submitted a common affidavit-in-reply to the
affidavits filed by the Respondent Nos. 1 to 5 as well as the
Respondent No. 6 wherein various details were provided including
the Annexures which were submitted by the Petitioner along with
the tender documents. It was further mentioned that the
contention that the setting up of a Mechanized Laundry should
have been reflected in Annexure-XII of the tender document itself
is misconceived.
SUBMISSIONS ON BEHALF OF THE LEARNED COUNSELS
FOR THE PARTIES
21. Mr. R. Dubey, the learned counsel for the Petitioner submitted
that Clause 1.3 of Part-I of the Notice Inviting Tender which is with
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the heading “System of Tendering” stipulates the “Financial
Criterion”. Referring to Sub-Clause (A) of Clause 1.3 of Part-I of the
Notice Inviting Tender, the learned counsel for the Petitioner
submitted that there is a requirement of submission of the Audited
Balance Sheets duly certified by the Chartered
Accountant/Certificate from the Chartered Accountant duly
supported by the Audited Balance Sheets. The learned counsel
submitted that there is no dispute that the Petitioner had duly
submitted the Audited Balance Sheets duly certified by the
Chartered Accountant. Referring to Sub-Clause (B) of Clause 1.3 of
Part-I of the Notice Inviting Tender, the learned counsel submitted
that the liquidity aspect have been duly mentioned which should be
valued at 5% of the estimated bid value of the applicant’s
commitments for other contracts. In that regard, the learned
counsel submitted that to prove the liquidity, there is a requirement
of submission of documents as per the format prescribed in
Annexure-XX and Annexure-XXI of the tender document.
22. The learned counsel for the Petitioner further submitted that
taking into account that the Petitioner did not have the 5% of the
estimated bid value as the liquidity in its balance sheet during the
financial year 2025-2026 as the Petitioner’s liquidity was only
Rs.7,15,89,187/- which otherwise should have been Rs.9.11
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Crores, the Petitioner had submitted a Banking Reference in the
form of a Bank Certificate in the format provided in Annexure-XX of
the tender document wherein the Senior Manager of the ICICI
Bank certified that the said Bank was willing to provide
overdraft/credit facility to the extent of Rs.9.2 Crores to meet the
Petitioner’s working capital requirement for executing the said
work. The learned counsel submitted that a perusal of the format
of Annexure-XX of the tender document would make it clear that
the said document need not be certified by the Chartered
Accountant inasmuch as the said Certificate has to be only issued
by the Senior Bank Manager of the concerned Bank along with the
address which was duly done so as would be apparently seen at
Page No.214 of the writ petition.
23. The learned counsel referring to the ground stipulated that the
Banking Reference document should be certified by the Chartered
Accountant on the basis of the second paragraph of Clause 1.3B of
Part-I of the Notice Inviting Tender submitted the same to be
completely misplaced inasmuch as, it is the Audited Balance Sheet
which has to be certified by the Chartered Accountant and in the
circumstance, the Audited Balance Sheet contains liquid assets,
lines of credit and other financial means which would meet 5% of
the estimated bid value, there is no requirement for issuance of
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certificate in terms with Annexure-XX of the tender document. The
learned counsel, therefore, submitted that it is under such
circumstances, the words have been used as “and/or” between the
two documents namely the Audited Balance Sheet and Banking
Reference.
24. The learned counsel for the Petitioner as regards the second
ground for rejection submitted that the said ground is completely
misconceived inasmuch as, the Petitioner duly submitted the
required documents in terms with Annexure-XII, XII(A), XII(B) and
XII(C) of the tender document which are different and separate
aspects dealing with the technical experience i.e. setting up a
Mechanized Laundry of minimum capacity of 4 Tonnes of linen per
shift while washing minimum of 4 Tonnes of linen per shift for a
continuous period of 12 months in the qualifying period i.e. current
year and three previous financial years. The learned counsel for
the Petitioner submitted that insistence upon by the Respondents
that Annexure-XII of the tender document should contain setting
up of the Mechanized Laundry is completely misconceived
inasmuch as, it is in Annexure-XII(A) of the tender document, the
said aspect is conceptualized.
25. The learned counsel for the Petitioner therefore submitted that
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this is a case wherein the Respondent Authorities have not only
misread the terms and conditions of the tender documents, but
also apparently for oblique purposes chosen to read in such a
manner in order to hold the Petitioner technically nonresponsive.
The learned counsel, therefore, submitted that this is a case which
would come within the ambit of malice in law and absolute
perverse reading of the terms and conditions of the contract for
which interference is called for.
26. Ms. R. Deka, the learned CGC appearing on behalf of the
Respondent Nos. 1 to 5 submitted that insofar as the liquidity
aspect of the Petitioner is concerned, the Banking Reference
Certificate has to be certified by the Chartered Accountant and in
that regard, referred to first sub-paragraph of Clause 1.3B of the
SOT. Insofar as the technical eligibility of the Petitioner is
concerned, the learned counsel submitted that the Petitioner failed
to submit valid and sufficient documents proving fulfillment of the
prescribed technical eligibility criteria of establishing execution of
works conforming to the definition of similar nature of works as
required by the NIT. The learned CGC submitted that the similar
nature of work has been defined in the “Special Technical Criteria”
mentioned in the tender document to mean setting up a
Mechanized Laundry of minimum capacity of 4 tonnes of linen per
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shift while washing a minimum of 4 tonnes of linen per shift for a
continuous period of 12 months in the qualifying period, i.e., the
current year and 3 previous financial years.
27. The learned CGC submitted that this similar work has to be
carried out in the establishments as mentioned in Clause 1.1 of the
“Technical Criterion” Clause of the SOT. However, the Petitioner
failed to submit any certificate evidencing execution of works
conforming to the prescribed definition of similar nature of work.
The learned CGC further submitted that the certificate upon which
the Petitioner relied is the certificate issued by the Office of the
Director of Medical Education, Vijayawada, Andhra Pradesh dated
13.06.2025 wherein the description of the work mentioned is
supply of linen and mechanized laundry service, which would not
include the requirement of setting up of a mechanized laundry
service.
28. Mr. G. Rahul, the learned counsel appearing on behalf of the
Respondent No. 6 submitted that though the learned counsel for
the Petitioner had mentioned about the submission of Annexures-
XII, XII(A), XII(B) and XII(C) of the tender document but what is
required to be looked into is whether the Petitioner had submitted
any certificate as defined as similar nature of works
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completed/ongoing during the qualifying period, as per Annexures-
II and III to the tender document. The learned counsel, further
referring to Clause 1.4.1.1(vi) of the SOT submitted that supporting
documents/certificates from organizations for which the Petitioner
had worked should be enclosed. The certificates which have been
enclosed by the Petitioner would not show that at one site, the
Petitioner had set up a Mechanized Laundry. The learned counsel
further submitted that as the tender in question is a BOOT (Build-
Own-Operate-Transfer) project involving the establishment of an
entirely new mechanized laundry facility together with the
installation, commissioning and operation of sophisticated
machinery and allied infrastructure, prior experience in merely
washing linen using an existing facility cannot be equated with the
experience of setting up a Mechanized Laundry as specifically
mandated in the tender.
ANALYSIS AND DETERMINATION
29. From a perusal of the materials on record as well as the
respective submissions, it appears that on account of two grounds,
the Petitioner’s bid was held to be technically non-responsive.
30. Let this Court, therefore, deal with each reason assigned
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independently.
REJECTION OF THE TECHNICAL BID ON THE GROUND OF
LACK OF CERTIFICATION OF THE CHARTERED
ACCOUNTANT TO THE BANKING REFERENCE DOCUMENT
31. At the outset, it is relevant to take note of that Clause 1.0 of
the SOT specifically refers to the “Eligibility Criteria”. Clause 1.1 of
the SOT is the “Technical Criterion” and Clause 1.3 of the SOT is
the “Financial Criterion”.
32. The Financial Criterion so set out are also Eligibility Criteria
and cannot be confused with the Financial Bid which is specifically
mentioned in Clause 1.4.1.2 of the SOT.
33. In the previous segments of the present judgment, this Court
has already quoted the relevant portion of Clause 1.3 of the SOT.
34. From a perusal of the same, it is seen that the bidder has to
have an annual turnover of not less than 1.5 times the advertised
bid value during the last 3 previous financial years and in the
current financial year up to the date of opening of the tender. To
prove the same, the audited balance sheet reflecting financial
turnover certified by a Chartered Accountant with her stamp,
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signature and membership number shall be considered and in that
regard, the bidder has to submit the requisite information in
Annexure-XIX of the tender document. In addition to that, the
bidder has also to submit copies of the audited balance sheets
certified by the Chartered Accountant/certificate from the
Chartered Accountant duly supported by the audited balance
sheets. Apart from the annual turnover, there is a requirement for
the bidder to possess liquidity. In other words, the bidder’s access
to or having available liquid assets, lines of credit and other
financial means to meet the cash flow. The liquidity required is 5%
of the estimated bid value, net of the applicant’s commitment for
other contracts.
35. In the instant case, as would be seen from the admitted stand
of both the parties, there was a requirement for the bidder to have
liquidity of Rs. 9.11 crores and the Petitioner’s liquidity, admittedly,
for the year 2025-26 was Rs. 7,15,89,187/-. This would be seen
from the certificate which was submitted by the Petitioner duly
certified by the Chartered Accountant in Annexure-XXI of the
tender document. In order to cover up the shortfall in liquidity, it
was permissible to provide a Banking Reference containing in clear
terms, the amount that the bank would be in a position to lend for
the work to the applicant/member of the joint venture of the
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consortium. The said Banking Reference should be from a
scheduled bank in India and should not be more than 3 months old
as on the date of submission of the bid. The said bank certificate
has to be issued in Form 20 in Annexure-XX of the tender
document.
36. The Petitioner duly submitted the said Bank Certificate issued
by the Senior Bank Manager of ICICI Bank, wherein it is mentioned
that ICICI Bank was willing to provide an overdraft/credit facility to
the extent of Rs. 9.20 crores to meet the Petitioner’s working
capital requirement for executing the contract in question. There is
no quarrel that the said document was submitted inasmuch as it is
duly admitted by the Respondent Authorities. However, the
question arises as to whether the said document has to be certified
by the Chartered Accountant inasmuch as one of the grounds set
out is that the said Banking Reference Certificate was not certified.
37. The opening sentence of the first sub-paragraph of Clause
1.3B of the SOT reads as under:
“ The audited balance sheet and/or banking reference certified
by chartered accountant with her stamp, signature, and
membership number shall be submitted by the bidder along
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with the bid.”
38. This Court has also taken note of Annexure-XX of the tender
document which stipulates the format for Banking Reference for
Liquidity.
39. In view of the stipulation in the opening sentence of the first
sub-paragraph of Clause 1.3B of the SOT that the audited balance
sheet and/or banking reference certificate be certified by the
Chartered Accountant with her stamp, signature and membership
number mentioned therein, it is clear that not only the audited
balance sheet, but the Banking Reference has also to be certified
by the Chartered Accountant.
40. The learned counsel for the Petitioner submitted that the
words “and/or” used between the words “audited balance sheet”
and “banking reference” means that insofar as the Banking
Reference is concerned, it is not necessary to be certified by the
Chartered Accountant. In the opinion of this Court, the said
submission is misconceived inasmuch as the words “and/or” is
used between the words “audited balance sheet” and “banking
reference” to indicate that the audited balance sheet would be
sufficient to be submitted along with the certificate of the
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Chartered Accountant if the audited balance sheet would be
sufficient to meet the liquidity. Else, there would be the necessity
of submission of the Banking Reference which also has to be
certified by the Chartered Accountant.
41. This Court, at this stage, finds it relevant to observe that the
condition mentioned in first sub-paragraph of Clause 1.3B of the
SOT that the Banking Reference has to be certified by the
Chartered Accountant, is therefore a requisite condition. This Court
thus in exercise of the powers of judicial review cannot hold that
the exercise of the Tendering Authority to reject the Petitioner’s
technical bid for not conforming with the mandate of first sub-
paragraph of Clause 1.3B of the SOT was illegal or arbitrary.
WHETHER THE PETITIONER MET THE TECHNICAL
ELIGIBILITY CRITERIA
42. In the Notice Inviting Tender, and more particularly in the
section specific to Special Technical Criteria, which has already
been quoted hereinabove, the definition of “similar work” has been
defined. The said definition required the bidder should have set up
a Mechanized Laundry of minimum capacity of 4 tonnes of linen
per shift, while washing a minimum of 4 tonnes of linen per shift
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for a continuous period of 12 months in the qualifying period.
43. This Court also takes note of that Clause 1.4.1.1(vi) of the
SOT categorically requires that the bid should comprise the list of
similar works completed/ongoing in the qualifying period and that
this list should be provided as per Annexure-II and Annexure-III of
the tender document. In addition to that, there was a requirement
of submitting supporting documents/certificates from the
organizations for which the bidders had worked.
44. The Petitioner herein has laid emphasis on a certificate dated
13.06.2025 issued by the Office of the Director of Medical
Education, Vijayawada, Andhra Pradesh.
45. A perusal of the said certificate does not show that the
Petitioner had set up the Mechanized Laundry. Rather, the name of
the work is supply of linen and Mechanized Laundry service. In the
opinion of this Court, the said certificate does not satisfy the
requirement in terms with Clause 1.4.1.1(vi) of the SOT read with
the definition of “similar work”.
46. In addition to that, Annexure-XII and Annexure-XII(A) of the
tender document should not be confused with the requirement in
terms with Annexure-II of the tender document inasmuch as, in
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Annexure-II of the tender document, it is categorically mentioned
that the list of similar works completed in the qualifying period is to
be provided referring to Clause 1.1 of the SOT.
47. Under such circumstances, it is, therefore, the opinion of this
Court that the rejection of the Petitioner’s technical bid on the
ground of not fulfilling the Technical Eligibility Criteria cannot be
said to be illegal or arbitrary.
CONCLUSION
48. In view of the above analysis, it is the opinion of this Court
that the instant writ petition is devoid of any merits, for which the
writ petition stands dismissed.
49. Interim order stands vacated.
50. However, in the facts of the present case, this Court is not
inclined to impose any costs.
JUDGE
Digitally signed by Satyam Sharma
Date: 2026.09.03 04:20:02 +05'30'
Comparing Assistant
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