Evaluation of Technical Tenders Without Disclosing Comparative Benchmarks or Recorded Reasons Is Arbitrary and Constitutionally Unsustainable

Two bidders, E Trav Tech Limited and M/s Verasys Limited, participated in tenders issued by the Ministry of External Affairs for outsourcing Consular/Passport/Visa (CPV) services in Kuwait, UAE, Singapore, and Australia.

The Request for Proposal (RFP) mandated a two-stage process: technical and financial.

Both petitioners were disqualified at the technical stage for failing to meet the minimum 70% score.

Following a Supreme Court directive in a prior round of litigation (E Trav Tech Ltd.-II), the Respondents disclosed parameter-wise mark breakups in May 2026.

The petitioners challenged this evaluation as arbitrary, noting that despite providing identical documentation across Missions, they received widely varying marks (e.g., E Trav received 4/7 in UAE but 0/7 in Kuwait for the same credentials).

E Trav claimed its financial bids were significantly lower than the successful L-1 bidders.

1. Whether the petitions were barred by res judicata or constructive res judicata due to previous litigation.

2. Whether the technical evaluation process was arbitrary, opaque, and violative of Articles 14 and 19(1)(g) of the Constitution.

3. Whether the failure to provide specific reasons for the deduction of marks and disqualification vitiated the process.

The court applied the principles of judicial review in contractual matters established in Tata Cellular v. Union of India, focusing on illegality, irrationality, and procedural impropriety.

It relied on Jagdish Mandal v. State of Orissa regarding the "arbitrariness" test in tenders.

It relied on Reliance Energy Ltd. v. Maharashtra State Road Development Corp. regarding the "level playing field" and legal certainty under Article 14.

The court further applied Rule 173(iv) and Rule 189 of the General Financial Rules (GFR), 2017, which mandate transparency and the recording of reasons for rejecting bids.

The court applied Clauses 5.4.2 and 7.3.4.2(d) of the Manual of Procurement of Non-Consultancy Services (2025) regarding debriefing unsuccessful bidders.

The Court found that the Respondents' evaluation was flawed as it applied undisclosed comparative benchmarks without explaining what constituted the "best offer".

For objective criteria (e.g., parking, office area, and turnaround time), the Respondents awarded inconsistent marks—sometimes zero—despite the petitioners' documented compliance with RFP standards.

Specifically, the Court noted the irrationality of awarding vastly different marks for identical corporate credentials across different Missions.

The Court rejected the Respondents' argument that oral presentations justified the scores, holding that oral explanations cannot substitute for recorded, contemporaneous reasons in the evaluation sheets.

The lack of reasons prevented any meaningful scrutiny and breached the undertaking previously given to the Court.

The plea of res judicata was rejected as the disclosure of marks created a fresh cause of action.

The Court set aside the technical evaluations and nullified the award of tenders to the private Respondents.

It directed the Union of India to issue fresh RFPs for all four Missions within one month.

To prevent service disruption, existing incumbents were permitted to continue until the conclusion of the new tender process.