Internal experience certificates between company units are invalid as "employer" denotes an independent, external entity.

The Respondent, South Eastern Coalfields Limited (SECL), issued a Notice Inviting Tender (NIT) for the construction and maintenance of a Coal Handling Plant on a turnkey basis.

Clause 8.4(A) of the NIT required bidders to possess experience in "similar nature of work" supported by work orders and completion certificates issued by the "employer".

The Petitioner’s technical bid was disqualified because the experience certificates submitted pertained to work assigned internally by one wing of the Petitioner's company to another.

The Petitioner challenged this disqualification, arguing that the NIT did not expressly prohibit internal work orders and that the rejection was hyper-technical and arbitrary.

The Respondents contended that an "employer" must be an independent external entity and that a company cannot legally contract with itself.

The Court applied the principle of limited judicial review in contractual matters, emphasizing that the Government and its instrumentalities possess the freedom of contract unless the decision-making process is biased, mala fide, or arbitrary.

It relied on Tata Cellular v. Union of India, which established that courts should exercise judicial restraint and not substitute their own expertise for that of the administrative body.

The court further applied the dual test from Jagdish Mandal v. State of Orissa: whether the process is mala fide/intended to favor someone, or so arbitrary that no responsible authority could have reached such a decision, and whether public interest is affected.

Finally, it cited M/S. Steag Energy Services (India) Pvt. Ltd. v. GSPC Pipavav Power Company Ltd., affirming that the final choice and flexibility in tender evaluation rest with the owner/employer.

The Court reasoned that while the NIT did not explicitly define "employer," the term inherently denotes an independent, external entity distinct from the bidder, presupposing an arm’s-length contractual relationship.

Legally, a company is a single entity and cannot enter into a contract with its own departments; therefore, no valid employer-contractor relationship exists in internal arrangements.

The Court observed that accepting internal certifications would undermine the transparency and sanctity of the bidding process, as such documents lack independent verification and are susceptible to manipulation.

Furthermore, the Petitioner’s reliance on a certificate from a Chartered Engineer engaged by itself was deemed equivalent to "self-certification," which does not meet the standard of a completion certificate issued by an independent project authority.

The Court concluded that the Evaluation Committee’s interpretation was plausible and reasonable, aimed at maintaining a level playing field.

The Court found no arbitrariness or violation of Article 14 in the Respondents' decision-making process.

Consequently, the Court declined to interfere with the technical disqualification, ruling that the decision fell within the permissible bounds of administrative discretion.

The writ petition was dismissed, and no relief was granted to the Petitioner.