Tender — Rejection of bid — Validity — Scope of judicial review — Interpretation of “haisiyat praman patra” — Requirement of District Magistrate’s certificate — Whether mandatory where not expressly stated in tender — Held, no.
Where the tender (NIT) required bidders to submit a “haisiyat praman patra” of ₹10 crores but did not specify that it must be issued by a District Magistrate, rejection of bidder’s technical bid on the ground that the certificate was issued by a private architect/valuer, and not by District Magistrate, was dehors the terms of the NIT and liable to be quashed. Tendering authority could not import an unstated condition from a subsequent Government Notification not incorporated in the NIT.
Further, additional justifications introduced later in counter-affidavit (viz., non-disclosure of encumbrances) could not sustain rejection when the original rejection was on another ground. Authority ought to have sought clarification before disqualification.
Principles reaffirmed:
Terms of NIT must be clear and unambiguous. (Maha Mineral Mining & Benefication (P) Ltd. v. MP Power Generating Co. Ltd., (2025) SCC OnLine SC 1942, para 19)
Judicial review confined to arbitrariness or deviation from NIT terms. (Tata Cellular v. Union of India, (1994) 6 SCC 651, para 94)
Order must stand or fall on reasons contained therein; fresh reasons cannot later be supplied. (Mohinder Singh Gill v. Chief Election Commr., (1978) 1 SCC 405, para 8)
Held, Mandi Parishad, being a statutory body under the U.P. Krishi Utpadan Mandi Adhiniyam, 1964, is not per se governed by the Government Notification dt. 29-10-2018 prescribing procedure for issue of solvency certificates by District Magistrate. Failure to specify in NIT that “haisiyat praman patra” must be issued by District Magistrate disentitled rejection on that basis.
Valuation certificate issued by Income Tax Department-empanelled valuer showing asset worth far exceeding ₹10 crores satisfied Clause 18.
Result — Impugned High Court judgment set aside. Matter remanded to respondent-Mandi Parishad to reconsider appellant’s technical bid and, if net worth condition is met, proceed with negotiation and determine award of remaining contract period between appellant and successful bidder.
Per Joymalya Bagchi, J. (for Surya Kant, J. and himself):
(1) Tender authority cannot add new conditions extraneous to NIT.
(2) Government notification not automatically binding unless expressly incorporated.
(3) Rejection order must stand on its recorded reason; later amplification impermissible.
(4) Judicial review in tender cases is limited to arbitrariness or deviation from tender conditions.2025 INSC 1276
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REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.____________/2025
(@ SLP (C) No. 20557/2021)
KIMBERLEY CLUB PVT. LTD. APPELLANT(S)
VERSUS
KRISHI UTPADAN MANDI PARISHAD & ORS. RESPONDENT(S)
J U D G M E N T
Joymalya Bagchi, J.
1. Leave granted.
2. Appellant is aggrieved by the judgment and order dated 07.09.2021
whereby the Division Bench of the Allahabad High Court, Lucknow
Bench refused to set aside the decision of 1st respondent-Krishi
Utpadan Mandi Parishad1 rejecting appellant’s technical bid on the
ground that the ‘haisiyat praman patra’ submitted by it had not been
issued by District Magistrate.
3. Dispute arose from a tender floated by 1st respondent-Mandi Parishad
to let out a banquet hall/terrace lawn for 10 years to the highest bidder.
The notice inviting tender2 prescribed a two-stage bidding process
1 Hereinafter referred to as “1st respondent-Mandi Parishad”
2 Hereinafter referred to as “NIT”
Page 2 of 7
comprising a technical bid and a financial bid. The technical bids were
to be evaluated first and only bidders meeting the eligibility criteria
would qualify for the second stage, where the financial bids were to be
evaluated and tender awarded to the highest bidder. One of the
conditions, namely Clause 18 in the NIT stated that bidder must submit
a ‘haisiyat praman patra’ of minimum ₹10 crores with the technical bid.
4. Appellant as well as 5th respondent (successful bidder) submitted their
respective bids. Appellant’s technical bid was disqualified for the reason
that the ‘haisiyat praman patra’ was issued by a private architect and
not a District Magistrate. Claiming itself to be the highest bidder and
that technical bid had been unlawfully rejected, appellant approached
High Court by way of a writ petition.
5. High Court dismissed the writ petition holding that valuation certificate
submitted by appellant having been issued by a private architect could
not be treated as a ‘haisiyat praman patra’, i.e., solvency certificate
which is always issued by the office of District Magistrate.
6. Appellant challenged the decision before this Court by way of Special
Leave Petition. This Court on 17.12.2021 while issuing notice, directed
as follows:-
“……………In case the successful tenderer has not started the
execution of the tender, no further work be done in pursuance
to the tender and in case it has so started, it would be subject
to the final orders to be passed by this Court ”
7. We have heard learned counsel for parties and perused the records.
8. The issue which falls for consideration is whether appellant, while
submitting a valuation certificate issued by a professional architect
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cum private valuer attached to the Income Tax Department, had
complied with Clause 18 of NIT which required it to submit a ‘haisiyat
praman patra’ of minimum ₹10 crores.
9. Appellant has strenuously argued that nothing in the NIT necessitated
that ‘haisiyat praman patra’ be issued by a District Magistrate. It
contended ‘haisiyat praman patra’ submitted by the appellant was by
an experienced valuer who was empanelled with the Income Tax
Department and there was no justification to reject such certificate. It
was also argued that the valuation certificate assessed the value of the
asset at around ₹99 crores, of which appellant was 76.09 %
shareholder, whereas as per clause 18 the bidder was to furnish a
‘haisiyat praman patra’ of minimum ₹10 crores only.
10. In rebuttal, the 1st respondent-Mandi Parishad referred to Uttar
Pradesh government notification dated 29.10.20183 laying down the
procedure for issuance of ‘haisiyat praman patra’ by District Magistrate.
It was contended that Clause 18 required submission of such ‘haisiyat
praman patra’ and not valuation certificate issued by a private valuer.
All bidders apart from appellant had submitted ‘haisiyat praman patra’
issued by District Magistrate. It was also contended that valuation
certificate does not disclose appellant’s net worth as it fails to indicate
whether the asset so valued was free from encumbrances.
11. In tender matters, the court exercising judicial review does not sit in
appeal over the decision of a tendering authority regarding
3 Notification No. C.M.-648/One-9-2018-7(M)/18, hereinafter referred to as “government
notification”
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disqualification of bid. Only in cases where such decision is dehors the
terms of the NIT or is patently arbitrary would the Court exercise powers
of judicial review and set aside such a decision.4
12. Having scanned the NIT, we are of the considered view that neither
Clause 18 nor any other condition specifies that the ‘haisiyat praman
patra’ submitted by a prospective bidder must be issued only by a
District Magistrate in terms of the government notification.
13. It is trite that the terms of an NIT must be clear and unambiguous.5 If
1st respondent-Mandi Parishad intended that ‘haisiyat praman patra’
must be issued by District Magistrate alone, it ought to have specified
so in the NIT conditions.
14. We are also unimpressed by 1st respondent-Mandi Parishad’s
submission that such condition was implied and followed by other
bidders, as nothing is placed on record to show that the government
notification was applicable to all tenders floated by 1st respondentMandi Parishad. It may not be out of place to bear in mind that the 1st
respondent-Mandi Parishad is not a government department to which
the notification is per se applicable but is a body constituted under a
statute, namely Uttar Pradesh Krishi Utpadan Mandi Adhiniyam, 1964.
15. Given the situation, it was incumbent on 1st respondent-Mandi
Parishad to indicate in the tender conditions that the ‘haisiyat praman
patra’ was to be obtained from a District Magistrate as per the
procedure laid down in such government notification. Having failed to
4 Tata Cellular v. Union of India, (1994) 6 SCC 651 [Para 94]
5 Maha Mineral Mining & Benefication Pvt. Ltd. v. Madhya Pradesh Power Generating Co. Ltd.
& Anr., (2025) SCC Online SC 1942 [Para 19]
Page 5 of 7
do so, the 1st respondent-Mandi Parishad could not have rejected the
certificate submitted by appellant on the ground that it was not issued
by a District Magistrate. That apart, appellant’s certificate has been
issued by an experienced valuer registered with the Income Tax
Department who is otherwise competent to issue such certificate.
16. A new objection has been raised in paragraph 6 of the counter affidavit
filed by 1st respondent-Mandi Parishad to justify the rejection of the
certificate submitted by the appellant. It is averred since the certificate
does not disclose encumbrances, if any, on the asset, it cannot be
termed as a ‘haisiyat praman patra’ indicating net worth of the bidder.
This objection has been taken for the first time in the judicial
proceeding and was not a ground for rejection of the technical bid as
would be evident from paragraph 8 of the counter affidavit which
unequivocally states as follows:-
“The Petitioner’s tender had been rejected on the ground that
they had not submitted required certificate issued by a District
Magistrate”
17. As per Oxford Hindi – English dictionary, the English translation of the
word ‘haisiyat’ is “capacity, ability, means or resources”.
6 No doubt from
such perspective, the ‘haisiyat praman patra’ would be understood as
net worth of the bidder. However, the valuation certificate had not been
turned down by 1st respondent-Mandi Parishad on such score. It was
rejected on the ground that it had not been issued by a District
Magistrate as per the government notification whose applicability to the
6 Oxford Hindi – English Dictionary, 38th impression – June 2010, Oxford University Press
Page 6 of 7
subject tender had not been spelt out in the NIT. Given these
circumstances, we are loathe to permit the 1st respondent-Mandi
Parishad to justify the rejection of appellant’s technical bid on such
additional ground belatedly taken in the counter affidavit. There is no
cavil that an order of rejection must be sustained on grounds stated
therein and additional grounds cannot be subsequently pressed into
service to justify such rejection.7 On the other hand, the valuation
certificate shows the worth of the appellant’s share in the asset far
exceeds ₹10 crores as required under Clause 18 of the NIT. In such a
situation, if the 1st respondent-Mandi Parishad doubted that the asset
was encumbered it ought to have sought clarification from the appellant
on such score before rejecting the bid.
18. For the aforementioned reasons, we are of the opinion that rejection of
appellant’s technical bid on ground that appellant’s certificate was not
issued by District Magistrate is dehors the terms of the NIT and is liable
to be quashed.
19. Impugned order of the High Court is set aside. The matter is remanded
to 1st respondent-Mandi Parishad to reconsider the technical bid of the
appellant and if it is satisfied that the net worth of the asset (free of
encumbrances, if any) disclosed in the valuation certificate submitted
by appellant meets the requirement of Clause 18 of the NIT, it shall
accept the technical bid and after due negotiations between appellant
and the 5th respondent (successful bidder), decide whether remainder
7 Mohinder Singh Gill & Anr. v. The Chief Election Commissioner, New Delhi & Ors., (1978)
1 SCC 405 [Para 8]
Page 7 of 7
of contract be awarded to the appellant or in the event 5th respondent
matches the financial bid or enhanced offer of the appellant, permit the
5th respondent to continue the contract for the remaining period.
20. With these directions, the appeal is disposed of.
…………………………………………., J
(SURYA KANT)
…………………………………………, J
(JOYMALYA BAGCHI)
NEW DELHI,
OCTOBER 31, 2025.
