The Supreme Court has held that an individual firm can count the proportionate share of work experience it gained as a partner in a Joint Venture (JV) towards eligibility criteria when submitting a solo bid for future contracts, provided the tender terms do not expressly exclude such experience.
Background
A government tender was issued by the Chhattisgarh Public Works Department for a road-construction project requiring bidders to show prior experience of completing similar work worth at least 50 % of the contract value. An applicant submitted its bid along with an experience certificate showing its 49 % share of a JV project that exceeded the required threshold. The department rejected the bid on the basis that the experience was not in the company’s “own name and style.” The Chhattisgarh High Court upheld the rejection, prompting the appeal to the Supreme Court.
Supreme Court’s Decision
A Bench of Justices Manoj Misra and Ujjal Bhuyan set aside the High Court’s judgment, finding no explicit provision in the tender documents that prohibited proportionate JV experience from being counted. The Court emphasised that:
If the Notice Inviting Tender (NIT) does not clearly state that JV experience is excluded, the tendering authority cannot arbitrarily ignore such experience.
The firm’s proportionate share in the JV work met the eligibility criteria when calculated on its own merit.
Disqualifying a bidder on the ground that the experience was held through a JV without a clear exclusion clause rendered the decision arbitrary and unreasonable in violation of the principle of equality under Article 14 of the Constitution.
Legal Principles Applied
The Court referred to precedents such as New Horizons Limited v. Union of India (1995) and Ganpati PV – Talleres Alegria Track Pvt. Ltd. v. Union of India (2009), holding that a JV partner’s experience can be regarded as its own unless the NIT specifies otherwise.
Significance
This judgment clarifies that in public procurement, bidders should not be disqualified on technicalities when their proportionate involvement in a JV satisfies the experience requirements. Tender notices must be clear and unambiguous if any category of experience is to be excluded, failing which constitutional fairness and competitive equity require consideration of such experience in bid evaluation.
