Mandatory requirement to submit Earnest Money Deposit in prescribed mode at bid submission is non-curable.

The Appellant, a registered contractor, participated in a tender (NIB No. 04/2025-26) issued by the Urban Improvement Trust (UIT), Jaisalmer, for road renovation.

The tender conditions required Earnest Money Deposit (EMD) via Demand Draft (DD) or Banker’s Cheque.

The Appellant initially submitted EMD as Fixed Deposit Receipts (FDRs).

Although the Appellant later submitted a DD on 23.08.2025 before the technical bids were opened, the respondent-authorities rejected the bid for non-compliance with the prescribed mode of EMD at the time of submission.

The Appellant’s writ petition was dismissed by a learned Single Judge on 24.09.2025.

Meanwhile, the work order was issued to a third party on 18.09.2025, and work is currently in progress.

1. Whether the rejection of a bid due to non-submission of EMD in the prescribed mode at the time of initial bid submission is legally sustainable despite subsequent rectification before technical evaluation.

2. Whether the requirement regarding the mode of EMD submission is a mandatory condition or a curable technical irregularity.

3. Whether judicial interference is warranted in a tender process that has already culminated in the issuance of a work order and commencement of public works.

The Court applied Rule 42(6) of the Rajasthan Transparency in Public Procurement Rules, 2013, which specifies permissible modes for furnishing bid security.

It relied on the principle that essential tender conditions must be strictly complied with as established in Central Coalfields Limited v. SLL-SML (Joint Venture Consortium) (2016) 8 SCC 622.

Furthermore, it applied the doctrine of limited judicial review in contractual matters and the necessity of maintaining a "level playing field," citing Vidarbha Irrigation Development Corporation v. Anoj Kumar Garwala (2020) 17 SCC 577.

The Court reasoned that compliance with bid security conditions must exist at the time of submission to ensure procedural uniformity and financial seriousness.

It rejected the Appellant’s argument that a subsequent DD "cured" the defect, noting that allowing post-submission rectifications of mandatory conditions would dilute the sanctity of the procurement process and unfairly benefit specific bidders.

The Court distinguished the precedents cited by the Appellant, such as Poddar Steel Corporation, clarifying that while ancillary/directory conditions might be relaxed, the mode of EMD is a part of the core eligibility framework.

Finally, the Court observed that since the project was already underway, the balance of convenience favoured public interest over the private prejudice of the excluded bidder.

The Court affirmed the order of the learned Single Judge and dismissed the Special Appeals, concluding that judicial restraint is necessary once a public project has substantially progressed.