Facts
The Respondent (APDCL) issued a Notice Inviting Tender (NIT) dated 11.09.2025 for a dedicated 33 kV feeder construction project
Source reference: p. 3The Petitioner submitted a bid and was declared one of three technically responsive bidders on 02.02.2026, despite not submitting supporting documents for "Bid Capacity" as required by Annexure-1(E)
Source reference: p. 17, 31Following price bid opening, the Petitioner was the lowest (L1) bidder.
Source reference: no citationAPDCL issued a Letter of Intent (LoI) on 05.02.2026, which the Petitioner accepted, subsequently depositing performance guarantees
Source reference: p. 20-21APDCL then requested the missing supporting documents for Bid Capacity calculation
Source reference: p. 22Upon review, a Committee determined the Petitioner failed to meet the bid capacity criteria
Source reference: p. 24APDCL issued a Speaking Order on 09.03.2026 rejecting the Petitioner’s bid and opting for re-tender
Source reference: p. 24The Petitioner challenged this as an arbitrary termination of a concluded contract.
Source reference: no citationIssues
1. Whether the Letter of Intent dated 05.02.2026 constituted a Letter of Acceptance (Work Order), thereby creating a concluded contract between the parties.
Source reference: p. 32 / para. 452. Whether the decision to declare the Petitioner technically non-responsive and re-tender the work was arbitrary or malicious in law.
Source reference: p. 33 / para. 45Law Applied
The Court primarily applied the principles of contract formation in public tenders, specifically the distinction between a Letter of Intent and a Letter of Acceptance as clarified in State of Himachal Pradesh v. Oasys Cybernatics Private Limited, which characterizes an LoI as a "promise in embryo" rather than a binding contract
Source reference: p. 30, 36-37It relied on Dresser Rand S.A. v. Bindal Agro Chem Ltd. for the doctrine that an LoI merely indicates an intention to enter into a contract in the future
Source reference: p. 27, 36Furthermore, the Court applied Article 14 of the Constitution regarding the "level playing field" and fairness in administrative action as highlighted in Reliance Energy Limited v. Maharashtra State Road Development Corporation Ltd.
Source reference: p. 29, 41-42Reasoning
Regarding the first issue, the Court found that the LoI explicitly stated the authority was only "intending to place an order" and was conditional upon further requirements
Source reference: p. 35, 37Under the bid terms, a separate Letter of Acceptance and a formal agreement were mandated for contract formation
Source reference: p. 33-34Regarding the second issue, the Court noted that Clause 15(iii) of the Bid Document strictly prohibited awarding contracts to bidders lacking bid capacity
Source reference: p. 39The Petitioner failed to submit mandatory supporting documents from electrical utilities to verify their capacity at the time of bidding
Source reference: p. 40The Court reasoned that APDCL’s initial decision to hold the Petitioner responsive without these documents was a mistake that violated the level playing field for other bidders
Source reference: p. 41Therefore, the subsequent rejection was a corrective measure to uphold the mandate of fairness under Article 14
Source reference: p. 42Holding
The Court held that: (1) The LoI did not constitute a concluded contract
(2) The rejection of the bid was neither arbitrary nor malicious, as the Petitioner was fundamentally ineligible for non-compliance with technical Bid Capacity requirements
Source reference: p. 43The Court dismissed the writ petition, affirming APDCL’s decision to proceed with a fresh tender
Source reference: p. 43Original Court PDF
M/S Win Power Infracon Llp And OrsvsAssam Power Distribution Company Limited And Ors
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