Bhilai Engineering Corporation Limited vs Steel Authority Of India Limited

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* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment reserved on: 30.04.2026
Judgment pronounced on: 14.05.2026
Judgment uploaded on: 14.05.2026
+ W.P.(C) 6041/2024, CM APPL. 25036/2024 and CM APPL.
5606/2025
BHILAI ENGINEERING CORPORATION LIMITED
.....Petitioner
Through: Mr. Gopal Jain, Sr. Adv. with
Mr. Rishi Anand, Mr. Utkarsh
Mishra, Ms. Deeksha Dubey &
Ms. Shruti Roy, Advs.

versus

STEEL AUTHORITY OF INDIA LIMITED .....Respondent
Through: Mr. Jayant Mehta, Sr. Adv.
along with Mr. Samaksh Goyal
and Mr. Pallav Arora, Advs.

CORAM:
HON'BLE MR. JUSTICE ANIL KSHETARPAL
HON'BLE MR. JUSTICE AMIT MAHAJAN
J U D G M E N T
ANIL KSHETARPAL, J.:
1. The present Petition invoking writ jurisdiction of this Court
under Article 226 of the Constitution of India seeks quashing of Letter
dated 18.04.2024 (Annexure P-1), vide which the representation of the
Petitioner was rejected in view of the observations made in Impugned
Advisory dated 17.09.2022 issued by the Corporate Projects Section
of Respondent/Steel Authority of India (‘SAIL’) (Annexure P-2),
leading to its bid disqualification in Impugned Tender
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:14.05.2026
11:29:25
W.P.(C) 6041/2024 Page 1 of 14

No.PROJECTS/CPX-B/COB-12/BATTERY-CCHP/TN-1042 dated
12.01.2023, floated by the Respondent in relation to installation of
battery proper along with oven machines, refractions, coal & coke
handling facilities (Package no.2) for its IISCO Steel Plant at Burnpur
(West Bengal) (Annexure P-3).
2. As such, the challenge herein essentially revolves around the
discretion exercised by the Respondent after taking into consideration
the observations made in the Impugned Advisory, wherein the past
performance of the Respondent with respect to Sinter Plant Project at
Bokaro Steel Limited (BSL) was found unsatisfactory.
3. The question that arises in the present case, thereby requiring
our adjudication is as follows:
i. Whether the Respondent was justified in rejecting the
Petitioner’s technical bid on the basis of inter departmental advisory,
while intimating Petitioner’s poor performance in a different project,
particularly when principles of natural justice have been complied
with pursuant to direction of the Court in its previous petition bearing
W.P.(C) No. 4044/2024?
ii. Whether at this stage, it would be appropriate to set aside award
of contract when 25% of the work, which is very significant in steel
production, has been completed and the successful party/bidder is not
before the Court?
4. The Respondent being a public sector undertaking invited
online bids on 12.01.2023 from experienced, resourceful and bona
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:14.05.2026
11:29:25
W.P.(C) 6041/2024 Page 2 of 14

fide bidders on global tender basis for the Impugned Tender. The bids
herein, were to be submitted in three parts, namely; (i) Bid Securing
Declaration, (ii) Eligibility Criteria, Fulfilment & Techno-Commercial
Bid and (iii) Price Bid.
5. It will be noted here that major component in the present tender
pertains to Stamp Charged Coke Oven Battery project, which has not
been previously installed at any SAIL plant.
6. Prior to the floating of the present tender, the Executing
Director (ED) Projects, on 17.09.2022, issued the Impugned Advisory
to all Directors/CVO, SAIL, intimating the satisfactory performance
of the Petitioner in the area of Top Charged Coke Oven Batteries at
different plants/units of SAIL. However, the performance of Petitioner
as a Consortium Partner for the installation of New Sinter Plant
Project at BSL was found and conveyed to be unsatisfactory.
7. The Petitioner’s bid was rejected on 07.03.2024 relying upon
the communication dated 17.09.2022. Aggrieved thereby, the
Petitioner, challenged the aforesaid communication by way of
W.P.(C) 4044/2024 captioned Bhilai Engineering Corporation
Limited v. Steel Authority of India Limited . This Court vide its Order
dated 21.03.2024, disposed of the said petition, thereby setting aside
the communication dated 07.03.2024, while issuing the following
directions:
6. Accordingly, the present writ petition is disposed of with a
direction to the Respondent to furnish the adverse material to the
Petitioner within a week, who shall file a detailed representation
within a week thereafter. The Respondent after giving an
opportunity of hearing to the Petitioner shall decide the same by
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:14.05.2026
11:29:25
W.P.(C) 6041/2024 Page 3 of 14

way of a speaking order in accordance with law within two weeks
thereafter.
7. This Court clarifies that it has not commented on the merits of
the controversy. The rights and contentions of all the parties are
left open. To balance the equities between the parties, it is clarified
that for a week after the Petitioner’s representation is disposed of,
the Respondent shall not award the contract in question.
8. Pursuant thereto, the Petitioner was granted an opportunity to
file representation and a subsequent opportunity of hearing, which led
to rejection of the Petitioner’s representation by way of a detailed
Impugned Letter dated 18.04.2024. Aggrieved thereby, the Petitioner
in April 2025 preferred the present Petition challenging the Impugned
Letter as well as the Impugned Advisory. During the pendency of the
present Petition, the Contract pertaining to the relevant project came
to be awarded to a consortium comprising of (i) M/s. SMS India Pvt.
Ltd.; (ii) M/s. Paul Wurth S.p.A Italy; (iii) Paul Wurth S.A.; and (iv)
MECON Ltd.
9. Learned senior counsel for the Petitioner, essentially, impugns
the rejection of the Petitioner, on the ground that the Respondent has
adopted an arbitrary and mala fide reason for disqualifying it from the
present tender process, which is based upon the unsatisfactory
performance in a different and unrelated plant project at BSL.
10. It has also been urged that the Impugned Advisory, in effect,
leads to a permanent blacklisting of the Petitioner, as it does not
provide any definite period for its operation.
11. Per contra , learned senior counsel for the Respondent has
argued that the unsatisfactory performance of the Petitioner at BSL
plant, has led to prolongation of contract, by virtue of culmination of
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:14.05.2026
11:29:25
W.P.(C) 6041/2024 Page 4 of 14

multiple legal proceedings. As such, in view of the Impugned
Advisory and in particular, Clause 9.3 of the Purchase Contract
Procedure (PCP), the actions of the Respondent were justified.
12. It has also been urged that the Stamp Charged Coke Oven
Battery and Top Charged Coke Oven Battery, are two distinct
technologies, in terms of oven machinery and coal cake charging
methodology. Accordingly, the Respondent’s performance in Top
Charged Coke Oven Battery, cannot become a basis for granting it the
present tender as well.
13. To answer the present controversy and the questions
highlighted in Paragraph No.3 ( Supra ), it would be relevant to
highlight that while deciding a Writ Petition arising out of rejection of
tender, due consideration is required to be given to public law element
in the contractual matters. The Courts are reluctant to entertain Writ
Petitions challenging violation of contractual terms except where
public money is involved, and it is found that expeditious disposal is
of utmost importance in the public interest. Hence, while deciding the
matters like the present, the Court is required to keep in view
primarily the interest of the public and public law elements.
14. In the present case, admittedly, pursuant to the directions issued
by this Court on 21.03.2024, the Respondent by way of the Impugned
Letter passed a detailed and elaborate order after considering
Petitioner’s representation as well as granting it an opportunity of oral
hearing. The operative part of the Order read as under:
“B) May it be noted that under the Phase 1 of the Expansion Plan
of the Bokaro Steel Plant for 5.77 MTPA Hot Metal Production, the
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:14.05.2026
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W.P.(C) 6041/2024 Page 5 of 14

Contract of the New Sinter Plant (SINTER PLANT-II) of 1x360m2
Sinter Machine Main Package had been awarded to the consortium
of M/s GP UKRGIPROMEZ (consortium leader) M/s
URALMASHPLANT JSC, M/s TRAFALGAR Int F.Z.E and M/s
Bhilai Engineering Corporation Ltd awarded for a total contract
value of EURO 19,763,700 and INR 519,55,64,000. The scope of
work of BEC consisted of design & engineering including all civil
works, steel structural works, refractory works, supply of plant and
equipment for the balance of plant, all including all electrical,
automation, utilities works etc. May it be noted that M/s BEC Ltd.
Bhilai is the main EPC contractor for the Sinter Plant Contract
having the major share of price component, constituting for seventy
percent of the total contract value aggregating to 448 Crores.
C) It is also to be noted that the even though the aforementioned
Contract was awarded for a total time period of thirty (30) months
10th May 2015 (being the effective date of the contract),
information was received from SAIL BSL that the said project has
been inordinately delayed due to factors attributable to BEC. Since
the site progress was the prime responsibility of M/s BEC and since
the progress of which has been extremely slow, the contract has
remained stalled from your end from February 2022 triggering a
massive stalemate of vital project investments. The progress
performance of BEC had been reviewed by the SAIL Corporate
Office with active consultation with SAIL Bokaro Steel Plant, and
following such examination, it was informed by way of the general
advisory dated 17.09.2022 regarding the `adverse report' received
against your unsatisfactory performance in the Sinter Plant
contract. Such 'adverse report' in the form of the general advisory
dated 17.09.2022 was taken into consideration by SAIL-ISP while
evaluating your bid.
D) May it be noted that on account of your poor performance, SAIL
BSL had taken the decision of de-scoping your portion of the work
assigned under the contract and complete the same at your risk and
cost. The same is admitted by you in your representation dated
30.03.2024 whereby you have admitted that that against this
decision, you had preferred a Writ Petition (being WP (C) No 2053
of 2023) before the Jharkhand High Court. In this regard, in your
representation dated 30.03.2024 you have stated that the matter
was heard at length and vide Order dated 10.10.2023, the Hon'ble
High Court was pleased to direct that no final 'decision shall be
taken by SAIL on the tender floated. However, as per the last Order
of the Hon'ble High Court, it is evident that the matter was
subsequently heard on 22.02.2024 whereby the Hon'ble High Court
has observed that "instead of not taking a final decision on the
tenders floated by the respondents, no coercive action was directed
in the sense that no risk and cost shall be recovered from the
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:14.05.2026
11:29:25
W.P.(C) 6041/2024 Page 6 of 14

petitioner by the respondents till the next date of listing" while also
observing "that the interim order dated 10.10.2023 shall continue,
in the meantime". Therefore, a cumulative reading of the Orders of
the High Court passed in WP (C) No 2053 of 2023 abundantly
clarify there is no prohibition on SAIL in de-scoping the work
originally assigned under your contractual obligations and/or
subsequent floating of tender, with the only restriction being
imposed effectuating the recovery of the costs till the adjudication
of dispute either through conciliation or arbitration. There is no
dispute to the effect that your performance in the Sinter Plant
Contract at SAIL BSL has been heavily compromised because of
your action/inaction towards contractual obligations for which
SAIL has suffered production and business losses.
E) In your letter dated 30.03.2024 you have also drawn attention to
the General Advisory dated 17.09.2022 whereby you have alleged
that the general advisory draws distinction to the satisfactory
performance of BEC in Top Charged Coke Oven Battery. In
support of your contention, you have alleged that as the tender was
for installation of a stamp charged battery which is similar to top
charged battery. You have also drawn reference to the
corrigendum by virtue of which the technical eligibility required
for applying to the tender was (i) Firstly past experience in
carrying out design/engineering, erection/supervision of erection
and commissioning /supervision of stamp charged by-product coke
oven battery and (ii) Secondly, supply of plant equipment of
top/stamp charged by product recovery type coke oven battery. You
have alleged that in view of the construction and technology of top
and stamp charged batteries with similar functioning, therefore
SAIL-ISP ought to have taken a considered view of the General
Advisory and allowed BECL to participate in the tender.
F) As regards the above, we state that there is a major difference
between a stamp charged battery and top charged battery. For the
purposes of brevity, the differences are not stated herein but have
been clarified in detail in Annexure 1 to this Order, which shall be
read as an integral part and parcel of this Order.”
Therefore, in light of the above paragraphs, based on your past
performance vis-a-vis "adverse report" it cannot be denied that your
performance in the Sinter Plant Contract in SAIL BSL has been
abysmally poor. Even to the extent the General Advisory states that
performance of BECL in Top Charged Battery is satisfactory and
considered view may be taken, SAIL ISP has drawn out the
distinction between Top Charged Battery and Stamp Charged
Battery (for which Tender was floated) and has not acceded to your
validation that Stamp Charged Battery and Top Charged Battery is
similar in function (clarified in Annexure 1). Therefore, taking into
cognizance the General Advisory dated 17.09.2022 received from
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:14.05.2026
11:29:25
W.P.(C) 6041/2024 Page 7 of 14

the SAIL Corporate Office, SAIL—ISP hereby rejects your
representation while complying with the Order dated 21.03.2024
passed by the Hon'ble Delhi Court and the directions contained
therein. Your bid for the tender enquiry PROJECTS/CPX-B/C0B-
12/Battery-CCHP/TN-1042 dated 12.01.2023 [SRM RFx No
2100000053] hereby stands disqualified for all purpose under
provision of SBD ITB clause 22.2.”
15. The challenge in the present case does not pertain to the
technical non-qualification of Consortium comprising of four
members, to whom the present tender has been awarded, nor does it
pertain to the contract being awarded at an excessive amount
adversely impacting public money.
16. Though the Petitioner has neither impleaded the members of the
subject Consortium nor challenged the award of the Impugned Tender
in their favour, the Petition cannot be dismissed solely on account of
non-impleadment and failure to challenge the award of the Impugned
Tender, as it only came to be awarded during the pendency of the
present proceedings.
17. Moreover, there is also no dispute that the Petitioner has failed
to complete Sinter Plant II project at BSL. Since, amongst the various
members of the Consortium at BSL, the Petitioner was the main EPC
Contractor for the aforestated project, which remained incomplete
despite grant of sufficient opportunities. Such failure on part of the
Petitioner led to the Respondent taking a decision to de-scope the
portion of work assigned to the Petitioner under the contract and
complete the same at the Petitioner’s risk and cost.
18. It is the case of the Respondent that only Two Coke Charged
Oven Battery Plants are currently in operation, out of which, one is
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:14.05.2026
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W.P.(C) 6041/2024 Page 8 of 14

likely to undergo cold repair in 2028-2029 and be re-commissioned by
2030-2031. Prior thereto, a new Coke Charged Oven Battery Plant
needs to be erected, commissioned and stabilized, a process which is
expected to take approximately around four years.
19. It also deserves mention that, after allotment of the Impugned
Tender to the Consortium in January 2025, nearly 25% of the work
has already been completed within a span of one year and three
months, including completion of the pile foundations for Coke Oven
Battery (‘COB’). The project is now set to enter the next phase of
installation of COB approximately by the first week of May 2026.
20. The distinction between the Top Charged and Stamp Charged
Coke Oven Batteries, as explained in Annexure-1 to the Impugned
Letter has been brought to the notice of this Court. The material
differences between the two lies in their design, coal charging and
pushing operations, quality parameters and type of machinery used, a
position which has not been disputed by the Petitioner.
21. In view of the aforesaid observations, the contention of learned
senior counsel representing the Petitioner, that the rejection is based
upon a different project altogether lacks merit. In particular, taking
into consideration the intricate nuances of the Impugned Tender, and
the fact that the Respondent intends to install Stamp Charged Coke
Oven Battery for the first time, the past performance of the Petitioner
at BSL has been correctly relied upon to reject its technical bid. While
the Impugned Advisory acknowledges the satisfactory performance
and long-standing experience of the Petitioner in Top Charged Coke
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:14.05.2026
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W.P.(C) 6041/2024 Page 9 of 14

Oven Battery Projects, the same cannot by any length justify its
acceptance for a Stamp Charged Coke Oven Battery Project, which
admittedly is distinct in nature and requirements.
22. The submission of learned senior counsel for the Petitioner, to
the effect that the pendency of dispute resolution arising out of the
Sinter Project at BSL, could not be relied upon, also lacks substance.
SAIL is entitled, while awarding future contracts, to assess the
suitability of a bidder on the basis of its performance in the previously
awarded work.
23. There is no occasion to hold that consideration of pending
disputes arising out of previously awarded contracts cannot be
considered as an adverse material for such assessment. The principle
of sub-judice or pending adjudication, does not exclude the Authority
from relying upon the past performance of the bidder, particularly in
the absence of any order of a Competent Authority discrediting such
assessment.
24. In regards to the aforestated, it shall also be noticed that the
action of Respondent to give consideration to the past performance of
the Respondent, is borne out of the terms highlighted in Clause 13 of
Section-A of the Impugned Tender which provides that an Employer
can take into account the capability and past performance of the
bidders in other projects while evaluating any Tender.
25. The core contention of learned senior counsel for the Petitioner
lies in the context of Impugned Advisory resulting in blacklisting of
the Petitioner. However, this argument is required to be examined
Signature Not Verified
Signed By:SAVITA
PASRICHA
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from two different perspectives, firstly, the action of the Respondent
does not amount to blacklisting because the Impugned Advisory is
merely an internal communication between the units of Respondent,
thereby intimating the bifurcation of satisfactory and non-satisfactory
past performance of the Petitioner in Top Charged Coke Oven
Batteries and in the remaining fields based upon Respondent’s own
experience at BSL, respectively. The said Advosiry is not intended for
external application by organizations/institutions/Steel Mills which
are not working under SAIL. The Petitioner has altogether also not
been debarred as such from participating in New Notice inviting
Tenders.
26. Secondly, blacklisting implies a complete debarment of the
bidder from participating in any of the project, which is not the case in
the present circumstances. The Petitioner continues to be eligible for
participation in Top Charged Coke Oven Battery Project and, as a
matter of fact, has been awarded contracts worth approximately Rs.
1,500 crores post the issuance of the Impugned Advisory. In such
circumstances, to state that the disqualification of the Petitioner
amounts to blacklisting, will be a position taken contrary to the
pertinent facts and circumstances.
27. For the sake of argument, even if the disqualification of the
Petitioner is to be assumed as blacklisting from other projects, still the
Petitioner cannot allege violation of principles of natural justice,
particularly, when the Petitioner was granted a fair opportunity of
hearing, pursuant to the order passed by this Court on 21.03.2024,
followed by the Impugned Letter. Accordingly, the Petitioner cannot
Signature Not Verified
Signed By:SAVITA
PASRICHA
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W.P.(C) 6041/2024 Page 11 of 14

claim that he has not been afforded any effective opportunity to
demonstrate its credibility credential and experience.
28. It will be noted here that the Respondent, is going to install
Stamp Charge Coke Oven Batteries for the first time and would like to
have an experienced contractor onboard for the same, who has
sufficient or atleast some experience demonstrating its capability and
credential in relation of Stamp Charged Coke Oven Battery works.
The Petitioner, however, does not claim that it has already gained
sufficient capability and experience by installing similar works for
other institutions/steel mills.
29. Though, there is some force in the submissions of learned
senior counsel for the Petitioner that the Impugned Advisory does not
prescribe any define period or time limit for its operation, which in
effect would result in indefinite period of blacklisting. Learned
counsel representing the Respondent, to this extent, has fairly
admitted that if the Petitioner makes a representation and satisfies
Respondent, the Impugned Advisory so issued can be reconsidered.
30. Notwithstanding, the aforestated, in the instant case, the
Impugned Advisory was issued in February 2022, whereas the
Impugned Tender came to be floated in January 2023. Hence, the
disqualification of the Petitioner, in consideration of an advisory
issued within less than one year prior to the Impugned Tender, cannot
be said to be arbitrary or irrelevant, and the Respondent was entitled
to take the same into consideration while evaluating the Petitioner’s
technical suitability for the Impugned Tender.
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:14.05.2026
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W.P.(C) 6041/2024 Page 12 of 14

31. In view of the aforegoing, the argument of learned counsel for
the Petitioner that the Impugned Advisory and consequent rejection
suffers from non-application of mind, lack of nexus has no merit. In
particular, when the Impugned Letter, is a fresh order passed by the
Respondent, after Petitioner had already been granted an opportunity
of hearing pursuant to the Order dated 21.03.2024 of this Court in
W.P.(C) 4044/2024. In exercise of writ jurisdiction, the Court is
expected to examine matter from all the perspectives. The respondent-
SAIL is expected to take a considered decision while keeping in view
poor performance of the petitioner-company in another project.
Hence, no fault can be found in the decision of SAIL to refusing to
hand it over another important project which is being established for
the first time.
32. Learned senior counsel’s reliance on the judgment passed in
Banshidhar Construction Pvt. Ltd. vs. Bharat Coking Coal Limited
1
& Others , is also misplaced. Since in that case, the Court returned a
finding that allotment of contract in favour of a successful bidder was
arbitrary, as the requisite documents had never been submitted by the
successful bidder while submitting the bid. While dealing with the
said facts of the case, the Court found that Bharat Cooking Coal Ltd.
had arbitrarily allotted the contract in favour of successful bidder.
33. Similarly, the reliance on the judgment passed in Blue Dreamz
Advertising Pvt. Ltd. & Anr. vs. Kolkata Municipal Corporation &
2
Ors. , is also misplaced, as the Court therein, found that the reasons

1
(2024) 10 SCC 273
2
2024 SCC OnLine SC 1896
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Signed By:SAVITA
PASRICHA
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W.P.(C) 6041/2024 Page 13 of 14

fell far short of rendering the conduct of the Appellant before the
Court so abhorrent as to justify invocation of drastic remedy of
blacklisting/debarment. The Court also came to the conclusion that the
Appellant has been subjected to disproportionate penalty. Hence, this
judgment also does not come to the rescue of the Petitioner.
34. Keeping in view the aforesaid discussions, no ground for
interference under Article 226 of the Constitution of India is made
out.
35. The present Petition is accordingly dismissed. The pending
applications also stand closed.
36. However, the Respondent shall remain bound of its stand to the
effect that, if the Petitioner makes a representation and establishes its
improved performance the Impugned Advisory as already issued shall
be re-considered.

ANIL KSHETARPAL, J.

AMIT MAHAJAN, J.
MAY 14, 2026
sp/hr
Signature Not Verified
Signed By:SAVITA
PASRICHA
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