Read Order: M/S COSMO ENTERPRISE Vs. UNION OF INDIA AND ANR

Mansimran Kaur

New Delhi, June 21, 2022: While holding that the petitioners had to clearly bear the consequence of not placing relevant documents before the tendering authorities at an appropriate stage of the tender process, the Delhi High Court has dismissed the petitions moved by the petitioners against their disqualification in relation to the tender issued by the respondents for manufacture and supply of certain items to the Railways. 

The Division Bench of Acting Chief  Justice Vipin Sanghi and Justice Sachin Datta said, The law is also well settled and while exercising jurisdiction under Article 226 of the Constitution of India, this Court is concerned only with the decision making process. Also, the action of the tendering authorities has to be assessed in the light of the materials placed before the said tendering authorities, and not on the basis of materials/documents subsequently produced.”

The petitioner had participated in the tender as a micro- enterprise under the Micro and Small Enterprise Act, 2006. The present petitions were directed against the disqualification of the petitioner in relation to the tender issued by the respondents for manufacture and supply of certain items to the railways. Admittedly, the only document furnished by the petitioner to establish its status as micro enterprise was the Certificate of Commencement of Production issued by the District Trade and Industries Centre, Raipur. The respondents did  not find this document sufficient enough to establish that the petitioner had a valid and subsisting registration as a micro enterprise as on the date of submission of its bid.

Thus, the only question that was posed for consideration was whether the respondents were justified in not accepting the Certificate of Commencement of Production issued by the District Trade and Industries Centre, Raipur, as a valid document, to support the petitioners’ bid as a bidder falling in the category of Micro & Small Enterprises.

In view of the same, the Court noted that in accordance with the material placed before the tender authorities, the petitioner could not have possibly been allowed to participate as an MSE, and could not claim a right to participate in the e-reverse auction process, as the occasion thereof would arise only if the petitioner was treated to be a bidder having valid MSE status in the light of the fact that the petitioners’ financial bid was not amongst the lowest, noted the Court. 

The Bench asserted that  it was not open for the respondents to infer and assume on the basis of Certificate of Commencement of Production submitted by the petitioner, that the petitioner continued to have a valid registration as a micro-enterprise under the MSME Act. This position was reinforced by the fact that the petitioner itself had sought to rely upon certain documents produced for the first time in these proceedings, to establish its status as a duly registered and existing micro-enterprise. 

As per the Bench, the bid of the petitioners were  liable to be assessed on the basis of materials/documents placed on record before the tendering authorities by the petitioner itself during the tender process, and not with reference to any fresh documents/materials which were now sought to be belatedly produced and relied upon by the petitioner.   In view of the aforesaid observations, the Court concluded this matter dismissing the instant petitions.

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