L&T’s ₹252-crore-lower bid rejected: later suspension of debarment could not cure ineligibility on tender deadline, Allahabad High Court rules

UPEIDA invited bids for an EPC project connecting Jewar Airport to the Ganga Expressway. The bid due date was 7 September 2026.

Larsen & Toubro (L&T) submitted a bid but did not disclose that the Jal Jeevan Mission, U.P. had debarred it on 13 April 2026. On 14 September 2026, the Mission kept the debarment in abeyance.

After seeking clarification, UPEIDA declared L&T’s technical bid non-responsive on 25 September 2026 because of the debarment.

L&T challenged that decision, arguing that the RFP did not require a separate declaration of debarment, that the abeyance order removed the disqualification, and that it had been denied an opportunity to cure the issue. It also relied on its lower bid price.

1. Whether clause 2.1.18 of the RFP was an eligibility condition that disqualified a bidder debarred on the bid due date.

2. Whether eligibility was to be assessed on the bid due date or the date of technical evaluation, and whether the subsequent abeyance of the debarment operated retrospectively.

3. Whether the debarment-related deficiency could be cured after the bid due date, and whether UPEIDA’s rejection of L&T’s technical bid warranted judicial review under Article 226.

Under Article 226, judicial review of tender decisions concerns the legality of the decision-making process, not the merits of the tender authority’s decision; interference is warranted where the decision is arbitrary, irrational, mala fide or perverse (Tata Cellular v. Union of India; Jagdish Mandal v. State of Orissa).

The tender’s author is ordinarily best placed to interpret its terms, and courts defer to that interpretation unless it is unreasonable or perverse (Afcons Infrastructure Ltd. v. Nagpur Metro Rail Corporation Ltd.; Agmatel India Pvt. Ltd. v. Resoursys Telecom).

Essential tender conditions must be strictly complied with and cannot be selectively waived or cured after the due date; permissible relaxation is limited to non-essential conditions and must not prejudice other bidders (Poddar Steel Corporation v. Ganesh Engineering Works; Central Coalfields Ltd. v. SLL-SML (Joint Venture Consortium)).

A stay or suspension of an order does not quash or erase it and ordinarily operates prospectively (Shree Chamundi Mopeds Ltd. v. Church of South India Trust Association).

Tender conditions must be applied uniformly to preserve a level playing field under Article 14.

Clause 2.1.18 expressly made an entity barred by a government authority on the bid due date ineligible to submit a bid. The Court treated it as an essential threshold condition, distinct from clause 2.2.2.10, which concerned the bidder’s construction record.

Since the bid due date was 7 September 2026 and the Jal Jeevan Mission’s debarment remained in force on that date, L&T was ineligible. The 14 September abeyance was prospective and did not alter its status on the bid due date; the bid-validity clause did not change the date for assessing eligibility.

The clarification process gave L&T an opportunity to respond, but could not permit it to cure an essential eligibility defect through a later event. Allowing L&T to proceed would also disadvantage prospective bidders who may have abstained in reliance on the published eligibility condition.

Its lower quoted price did not create a right to have its financial bid considered, and its delayed disclosure weighed against discretionary relief, though the Court made no finding of fraud.

UPEIDA’s decision to reject the technical bid was within the RFP and was not arbitrary, irrational, mala fide or perverse.

The writ petition was dismissed, with no order as to costs; interim orders were vacated.