CASE TITLE : M/S. ROSMERTA TECHNOLOGIES LTD. V. STATE OF ODISHA & ORS.
CASE NO : W.P. (C) NO. 7776 of 2024
DATE OF JUDGMENT : June 18, 2024
CORAM : The Chief Justice, Justice Murahari Sri Raman

Disqualifying a legal person/bidder from participating in a tender process on the basis of litigation/arbitration history with the Government is arbitrary and violative of Article 14 of the Constitution

The Commissioner of Transport had floated a tender in the form of ‘Request For Bid’ (RFB) for selection of successful bidder for ‘Design, Construction of Automated Testing Stations, Procurement, Supply, Installation of vehicle testing equipment and Operation and Maintenance at 21 locations in Odisha State’.

It provided certain pre-qualification conditions which were required to be fulfilled by the prospective bidders. One of such conditions was that to qualify for the bidding process the bidder had to compulsorily give an undertaking to the effect that it did not have any litigation, or arbitration history with any Government/Public Sector Undertaking/or any other agency during the last ten years.

Therefore, the said provision excluded such companies from participating in the bidding process that have any litigations/arbitration history with any Government Department/Public Sector Undertaking/private sector or any other agency during the last ten years.

The prime legal questions which cropped up for consideration were as to whether the pre-qualification condition which restricts the competition to such parties only which do not have any litigation/arbitration history with the Government during the last ten years, is violative of Article 14 of the Constitution of India and whether pendency of a litigation or arbitration at the instance of or against a legal person can itself be a ground for disqualification in the matter of award of a Government contract in favour of such person.

While answering the aforesaid questions, the Court deemed it pertinent to rely upon the observations made by the Hon’ble Apex Court in the cases of Ramana Dayaram Shetty v. International Airport Authority of India, reported in (1979) 3 SCC 489 and Tata Cellular v. Union of India, reported in (1994) 6 SCC 651 wherein it was held that the State cannot act arbitrarily in entering into relationship, contractual or otherwise with a third party and its action must conform to some standard or norm which is rational and non-discriminatory.

Against the aforesaid legal backdrop, the Court held that the impugned pre-qualification condition essentially introduces an arbitrary classification between such companies, who have litigation history and those who do not have. Thus, the Bench observed as follows:

“Litigation history itself initiated by or against a legal person cannot incur a disqualification from participating in a tender process. Such classification, thus, does not have any intelligible differentia and nexus with the object to be achieved. Apparently, the purpose of issuance of public notice inviting tender is to select the best from the market. In the present case, by introduction of such clause, the very purpose of fair competition stands defeated.”

As a corollary, the Court declared the pre-qualification condition as unconstitutional being violative of Article 14 of the Constitution of India.

CASE TITLE : DR. PANKAJ KUMAR PARHI V. NIVA NAYAK & ORS.
CASE NO : W.A. NO. 3103 of 2023
DATE OF JUDGMENT : July 31, 2024
CORAM : The Chief Justice, Justice S.S. Mishra

Court cannot sit as an Appellate Authority over Selection Committee to adjudge merit and suitability of candidates for appointment to a certain post.

The Fakir Mohan University, Balasore had come out with an advertisement inviting applications from the eligible candidates for two posts of Associate Professor in the Department of Chemistry. Admittedly, both the posts belonged to Unreserved (UR) category. However, as per Rule 4 of the Orissa Civil Services (Reservation of Vacancies for Women in Public Services) Rules, 1994, one of those two seats was reserved for women candidates.

It was made clear in the said advertisement that in case of non-availability of suitable women candidates, the post shall be filled up by male candidates from the same category. The respondent no.1 had applied for selection to the said post, claiming the female reservation. However, after the interview, the appellant and another male candidate were found eligible by the selection committee for appointment.

The committee also concluded that no female candidate was found suitable for appointment to the advertised post and therefore, two male candidates were given appointment. Being aggrieved by non-selection, the respondent no.1 filed a writ petition challenging the appointments. The said writ petition was disposed of by a Single Judge with an observation that the Court cannot sit as a Super Selection Committee to decide suitability of candidates. Nevertheless, it asked the University to have a relook into the selection process, having regard for the reservation prescribed for women.

As per the above direction, the University re-examined the case of respondent no.1 and communicated to her that there was no irregularity/indiscretion in the selection process. It was further conveyed that the Selection Committee had decided to have a cut off score of 50% or more in aggregate and since respondent no.1 had not secured 50% of marks, she was not suitable.

Assailing the aforesaid communication, the respondent no.1 filed another writ petition whereby the Single Judge quashed the impugned communication and held respondent no.1 to be suitable for appointment against the vacancy meant for UR-W category and accordingly, directed the University to appoint her in place of the appellant. The appellant challenged the order of the Single Judge in this writ appeal.

After hearing the submissions of the respective parties, the Court framed three questions to be answered in this appeal. The core moot question which arose for consideration was whether the Court while exercising the power of judicial review can sit as an appellate authority over the decision of a duly constituted Selection Committee.

To answer this question of law, the Court examined the precedents set by the Hon’ble Supreme Court. It went through the observations made by the top Court in the cases of Dalpat Abasaheb Solunke and others v. Dr B.S. Mahajan & Ors., reported in (1990) 1 SCC 305 and Tajvir Singh Sodhi v. State of Jammu & Kashmir reported in 2023 SCC Online SC 344, wherein it was commonly held that it is not within the domain of the Courts, to enter into the merits of a selection process, a task which is the prerogative of and is within the expert domain of a selection committee.

Having considered the aforesaid position of law, the Division Bench set aside the order passed by the Single Judge and observed as follows:

“The selection committee consisting of experts evaluated suitability of the candidates including that of respondent No.1. In the opinion of the selection committee, the respondent no.1 was not found suitable for the post of Associate Professor to teach at the Post-Graduation level. This Court exercising power of judicial review cannot go into the assessment done by the selection committee of experts on the question of suitability of respondent No.1.”