WP/23084/2025 of M/s Leotech Process Vs Union of India, on 15 December 2025

ORDER:

This Writ Petition is filed aggrieved by the action of Respondents 3,4 and 5 in qualifying the 6ft Respondent in respect of Tender dated 15'O5'2025' which' according to Petitioner, is contrary to Annexure-XlX and XX and the instructions at page 138 of the Tender Notice' Petitioner' therefore, seeks to declare the said action as illegal' arbitrary and contrary to the tender conditions, and consequently to set aside the qualihcation of the 6th Respondent in the above tender process ]^5.12.202s

2. Petitioner states that the 6ft Respor dent did not comply u,ith the said requirements, having faile I to disclose crucial information that directly affects deternr; ration of its eligibitity, tirerefore ought to have been disqr r lified at the threshold. Il Is stated, on 15.O5.2025, the 5tr Respondent issued e-tender calling for bids for a comprehens \ e, Iarge-scale turnkey BOOT (Build, Own, Operate and Tra r sfer) project involving the establishment o[ a 20 TPD mechaniz:d 1aundry at Secunderabad. The scope of the project inch r ed washing, cleaning, drying, pressing, packaging and supply r'linen for AC coaches of trains maintained at Secunderaba I as well as transportation of soiled linen to the laundry a:-r 1 delivery of washed and packaged linen to designated i I :ations. The contract was to be executed over a period of ten r:ars, with an estimated tot-al value exceeding Rs. 434 crores ar C an annual value ol approximatcly Rs. 43.47 crores. Tht. tender was designed as a two packet system, requiring bidde -s to submit eligibility doc:uments in the first packet and priu bids in the second. Only those bidclers, who were found compl ant with the eligibility re quirements in the first packet were r I be declared l J qualihed on the GeM portal and proceeded to hnancial evaiuation. 2 .l . Petitioner states furthe r, 2l .06.2025 was the last date prescribed for submission of bids. Upon examination of the eligibility documents, the Tender Committee declared Petitioner and the 6tr' Respondent as qualifre d on 26.07 -2O2 5 Thereafter, on 30-07.2025, financial bids were opened, and the 6m Respondent was declared L1, while Petitioner declared L2' It is also stated, the tender contained detailed instructions outlining the list ol documents required for consideration o[ eligibility' These inctudcd various mandatory declarations which were required [o accompany the bid without exception The instructions unequivocally stipulated that failure to upload any mandatorl' document would result in outright rejection of the bid. Among these mandatory declarations were Annexure XIX, which required the bidder to affirm 'the truthfulness of all statements made in the bid, and Annexure XX, which required the bidder to declare whether it had ever been debarred from participating in tenders by Railways, PSU or State Government' Petitioner asserts that compliance with these declarations was d essential derermining the eligibility of bidd: .s, and any deficiency rendered the bid liable rejection. c) PCtitioner contends that the 6h Resp<;r clent failed to comply u,ith these requrrements. According to pet ir iont:r, the gth Respondent did not discrose that its contract ,," th Northern Railway had becn from participa ting participating in any future tenders Despite this, the 6th Respondent terminated and that it had t r en debarred in tenders floated by that Re ilwav. Such undisclosed inlormation was crucial for assessing rec cligibility of the 6th Responclent and that suppression of. sr ch materiar facts amoun t s to a clear violation of mand:r ory tender conditions. Ott 2).06.2024, Northern Railway terr rrnated the contract arr,,ar-decl to the 6rh Respondent un(L r a GeM procurement and simulhneously, debarred lrem from :ssued by Northt,: n Railway failed to declarr the said termination anrl debarment in the mandatory decla.r lion. This omission amounts to false declaration, attracting mmediate disqualifrcation as per the tender conditions.

2.3. petilioner also states that on lZ.Og.2O24 liuntakai Division of South Central Railu,ay disqualified the 6rh , Respondent in respect of another tender on the grourr I that its L

contract had been terminated and that it had been debarred by Northern Railway. According to Petitioner, this demonstrates that other division of the Railways have recognized the terminationanddebarmentaSadisqualifyingfactor,whereas Respondents have ignored the same in the present tender process. This inconsistency further highlights the arbitrary and irregular approach adopted by Respondents in qualifying the 6h Respondcnt 2.4 . Petitioner states that in view of the serious discrepancies and violations observed, he submitted a representation dated 01.08-2025 to the l"t Respondent' requesting verihcation of tender proceedings and pointing out the6hRespondent'snon-compliancewithtenderconditions. Despite such representation, ofhcial respondents failed to take corrective action or to re-evaluate the qualification of the 6h Respondent. It is contended, the 6fr Respondent has not complied with the fundamental eligibility requirements of the tender and that its qualihcation is contrary to the explicit terms ofthetenderconditions.Petitionertherefore,statesthat,the decision to qualify the 6d' Respondent is patently illegal'

arbitrary, unreasonable and unsustainable in lrw, and that such action deserves to be set aside by this Courr.

3. Respondents i to 5 stated in their coL nter that Writ Petition is devoid of merit and is liable to I ,e dismissed. According to them, the afhdavit filed in support ,r Writ Petition does not disclose any valid, tenable or substantj. I ground that would justifv the extraordinary and discretionan urisdiction of this Court being invoked. It is the categon:al stand of Respondents that Petitioner has not approached r1 is Court with clean hancls and has suppressed materirr facts and circumstances, lhereby disentitling him to any re1i, f.

3.1. Respondents I to 5 have carefulll, , xamined the averments contained in the Writ affidavit and srir e that tender process impugned by Petitioner was condu<:r::1 strictly in accordance with law, with full adherence to tt-: terms and conditions specihed in the tcndcr document an i the relevant Government and Railway guidelines gove -ning such procurement. It is stated, technical bids were s;r Lbjected to a comprehensive evaluation by a duly-consti .r Lted Tender Committee comprising competent officers and drl rain experts. This Committee objectively assessed all bids, ir < luding those submitted by Petitioner and the 66 Respondent' strictly based on the documents uploaded on Government e-Marketplace (GeM) portal. Upon such scrutiny, they contend that both the Petitioner and the 6e Respondent were found to satisfy all eligibility criteria and technical requirements Respondents specilrcally deny any breach or violation of Conditions 4' 6 or 7 of Annexure XIX or Annexure XX of the Tender Document' as alleged by Petitioner.

3.2. I t is the further stand of Respondents that evaluation process was undertaken in an objective, transparent and fair manner, strictly consistent with General Conditions of Contract for Services issued by the Indian Railways' It is stated' the conditions referred to by Petitioner' including those relating todeclarationsandmandatorydisclosures,wereclearly stipulated in the tender document and were binding alike on all participating bidders The required an integral declarations, including Annexure XX, formed of the eligibilitY including the 6d evaluation framework, and all the bidders' Respondent, furnished the mandatory documents' Respondents categorically deny Petitioner's allegation that the 6rh Respondent suppressed materiai facts relating to terminatlon or part \ ')

iL.ft debarment. They state that both the bidd: Petitioner, rvere found technically-qualified anrl Respondent emerged as Ll solely on the basis r,l evaluation. With respect to Petitioner's allegatrc termination and debarment by Northern Railu'a1 , state that the said issue was discovered only afte ' todged a complaint, following which the ma t verified. It was then ascertained that the 6th Rr: been subjecl-ed to debarment by the Northem Rail the Hon'ble Delhi High Court, by order dated 2t, stayed the operation of the impugned debarment as it pertained to disqualification of the 6th F! future bids. The Respondents rely upon the said s contend that in view of the subsisting stay, thc (r cannot be considered disqualified.

3.3. Respondents further state that afte' stay order, the 6th Respondent had been awarc ( thirty work orders by various Railway Zones acrot; They point out that Petitioner themselves had n some of those tenders but did not raise any objer: Respondent's participation therein. Thereby ther 's, including that the 6n hnancial bid -r concerning Responde nts the L2 bidder :r was duly ,po nden t had ray; however, )6.2024, h,ad etter, insofar spondent for ,ay order and t Rcspondent securing the d more than the country. rrticipated in ion to the 6h contend that

the present Writ Petition has been selectively filed and 1S motivated by personal considerations rather than legitimate grlevances.

3.4. These Respondents state that representation dated 0 1.08.2025 submitted by Petitioner is under consideration of the competent authority, however, they assert that mere pendency of such representation does not operate as a bar to theissuanceoflrtterofAcceptalce(LoA),whichformspartof the procedural culmination of a concluded tender evaluation' Petitioner's apprehensions regarding possible prejudice are' according to Respondents, wholly unfounded and do not constitutesuflrcientgroundstostallthetenderprocessor interfere with administrative decision-making'

3.5. Respondents 1 to 5 further clarify that though a differentDivisionofsouthCentralRailwaydisqualilredthe6h Respondent in a separate tender proceSs' such disqualification wasbasedoncombinalionoffactors,namely(1)non_disclosure of debarment, (2) failure to meet liquidity criteria' and (3) machinery-reiated shortcomings' They contend that such disqualification has no bearing on the present case' where all bids were evaluated independently and where the Tender L

Committee found no ground for disqualil5 Respondent. it is asserted, the evaluation unde ful1y conformed with the tender conditions an c arbitrary nor irregular. It is specifically stated, tt.r Respondent was compliant and responsive irL accompanied by the requisite declaration under,4r mandated by Clause 2.8(iii) of the tender c'r decision taken by the Tender Committee is not tl fides or undue influence, and that the Committerr its discretion within the ambit of the tender rules r guidelines. Judicial interference with such processes, it is contended, is neither warranted n,r 3.6. Fina11y, Respondents state that \l I speculative and constitutes an unwarranted atterc u,ith a reasoned administrative process, th,r avoidable dclays in execution of a critical public They therefore, pray that Writ Petition be d i exemplary costs so as to prevent unwarranted dis tender process and to serve the interests ofjusticr: 4 . Petitioner filed reply specifica i Respondents' contention that Writ petition disclo s ing the 6trr -taken herein was neither bid of the 6ft all respects, nexure XX as rditions- The nted by maLa has exercised nd applicable dministrative 'appropriate. it Petition is :t to interfere eby causing rdliq/ project. ;missed u.ith 'uption of the , disputing rs no valid or substantial gravamen failure to grounds for interference of Writ Petition rests upon disclose termination of its by this Court' The the 6th ResPondent's contract bY Northern mandatorilY required to that this non-disclosure of material and disqualifYing render the 6fr According to convenientlY RaiiwaY, which the 6h Respondent was discloseundersub_clause(iii)ofCondition2.Bofthetender conditions. Petitioner contends amounts to deliberare suppression fact, existence of which would automatically Respondent ineligible for technical evaluation Petitioner, Respondents have consciouslY and circumvented an essential and mandatory condition of the tender, thereby vitiating the entire evaluation process 4.1 Petitioner clarihes that they do not dispute technical qualifrcations or experience of the 6s Respondent per se. Their challenge is confined solelY to the legaliq/ and proPrietY of ResPondents' decision Respondent's bid despite its failure to disclose a termination that directly attracts disqualification clause' Petitloner specifically denies the assertion made in paragraph 7 of the counter a-f{idavit, wherein Respondents claim that bid of the 6th ResPondent was evaluated objective, transParent, and to consider the 6th ftr"*. ln an

t2 lawful manner. It is stated, Respondents thems: that the factum of termination and debarme : Respondent by Northern Railway came to their kt after such information was brought to their at t bidder, subsequent to the identification of L1 admission, according to Petitioner, conclusively er; the 6d Respondent suppressed information .r mandatorily obliged to disclose through Anne> declarations required under Condition .', suppression, Petitioner states, is fatal to the 6th eligibility a nd ought to have resulted ir drsqualification.

4.2. Petitioner denies Respondents' conte r of debarment by the Hon'ble Delhi High C r consideration of the 6h Respondent's financial bi,l out, the sta]. order dated, 28.06.2024 only stayed of debarment, and did not stay or set aside ,r contract by Northern Railways. Termination, Petitioner, remains valid, subsisting and l therefore, continues to have iegal consequen,; disqualihcation under the tender conditions. ( ves admitted : of the 6e owledge only :ntion by L2 bidder. This ablishes that hich it was ure XX and 3(iii) Such Respondent's immediate ion that stay urt justified It is pointed -he operation rmination of rccording to ru-rchallenged, s, including onsequently, reliance on the stay order is wholly misplaced and does not cure the suppression committed by the 6fr Respondent' 4 .3. Petitioner further disputes reliance of Respondents on the assertion that more than thirty works have been awarded to the 6ft Respondent subsequent to the stay order' Such subsequent awards cannot legitirnize suppression of material facts in the present tender, nor do they have any bearing on interpretation or applicability of Condition 2 B of the current tender document. It is stated, they are unaware whether those tenders contained a condition analogous to Condition 2'8 and even otherwise, multiple violations in other tenders cannot justify a violation in the present case' Two or more wrongs cannot render an iliegal act lawful'

4.4. Petitioner candidly admits that they participated in someofthetendersinwhichthe6ftRespondentwasar,varded work orders; however, it is clarified that at the relevant time' they were not aware of the Northern Railway termination They cametoknowofthesaidterminationonlyrecently'and therefore no adverse inference can be drawn from their earlier participation. Respondents Petitioner specihcaily denies the contention of that submission of Annexure XX by the 6m llt:,1:.

t4 Respondent remains valid by virtue of the sta'/ reiterated thzrt on the date of submission of tender order was vety much in force and had attained finrr not challenged by the 6e Respondent. Therefore, t:r furnished in Annexure XX is incorrect, misle;r violation of the tender conditions.

4.5. Pelitioner states, Respondents' I separate decision of Guntakal Division of S r Railway, whcrein the 6ft Respondent was dis multiple reasons including termination by Norl l only highligh[s the inconsistency and arbitra - present evaluation. According to Petitioner, Gunt correctly Considered termination as a disqualihcation, whereas Respondents ignorcc material facl- without justification. This inconsislr Petitioner s[ates, clearly demonstrates that tL committee in the present case failed to adhere to I requirements of the tender.

4.6. tt is the specihc and categorical case that the 6tt' Respondent suppressed terminatior Railway cor,.1-ract, which squarely attracts Conditi'r order. It is termination ity, zrs it was : declaration ling and in :ference to uth Central luahfied for ern Railway, ness in the rkal Division 3round for the same nt approach, e evaluation re mandatory of Petitioner of Northern r 2.8(ii) of the tender conditions and mandates disqualification. Respondents have circumvented mandatory conditions with impunity, thereby rendering the entire evaluation process illegal, arbitrary, and void. In view of the above submissions, it is stated, the claim of Respondents that the Tender Committee evaluated the bid of the 6h Respondent strictly in accordance with the tender conditions is wholly incorrect and unsustainable.

5. Heard Sri Prasad Rao Vemulapalli, learned counel for petitioner, Sri B. Narasimha Sharma, learned Assistant Solicitor General and Sri V.T. Kalyan, learned Standing Counsel for Central Government and Sri B. Chandrasen Reddy, learned Senior Counsel on behalf of Sri B. Vamshidhar Reddy, learned counsel for Respondent No.6.

6. Having heard learned counsel on either side and having considered the pleadings ald the documents brought on record, the core issue arising for adjudication in the present Writ Petition pertains to the decision of Respondents 3, 4 and 5 to treal the 6ft Respondent as technically-qualified in the tender process initiated pursuant to Tender Notice dated 15.05.2025. Petitioner contends that such qualihcation was accorded in complete disregard of the mandatory conditions governing the &h, l6 tender, with particular reference to Conditions 1 Annexure XIX as well as the declaration envi Annexure XX. It is the specific assertion of Petitio compliance with these essential requirements goe r; the eligibilitl, scrutiny and materially affects the the technical evaluation undertaken by the authorities.

7. The principal grievance advanced b--. that the 6th Respondent did not disclose the contract with Northern Railway had been trr 21.06.2024 and that, consequent thereto, it had I from participating in future tender processes. Petitioner, this was precisely the nature of materi I that Annexure XX obligated every bidder to c omission of such a fact amounted to suppress Lr circumstancr: having a direct bearing on bicldr:: Petitioner asserts that this failure to disclose a event, by itself, renders the bid of the 6m Res: responsive and liable to be rejected at the threshoi I B. Respondent - Raiiways, on the other h that technical evaluation was undertaken strictly i 6andTof ;aged under rer that non- [o the root of legitimacy of Respondent Petitioner is act that its minated on :en debarred \ccording to information isclose, and n of a vital 's eligibility. Cisqualifying rndent non- Lnd, contend r conformity

I7 a withthetenderconditionsandthegoverningprocedural guidelines. They assert that the 6fr Respondent furnished al1 the requisite declarations, both the Petitioner and the 6dl Respondent were initially found technically-qualilled and that the information pertaining to termination of contract and the consequential debarment came to their knowledge only at a subsequent stage. Respondents further place reliance on an interim order passed by the Hon'ble Delhi High Court' whereby operation of debarment order has been stayed, and they submit that this development has a bearing on consideration of the 6ft Respondent's eligibilitY' S. This Court is not convinced with the explanation advanced by Respondents. The tender conditions unequivocally mandated every bidder to make a truthful and complete disclosure regarding debarment by the Railways or by any other Government authority. This requirement was not intended to be a mere procedural formality; rather, it constituted an essential safeguard designed to uphold transparency, fairness' and integrity in the tender evaluation process' It is an admitted position that the 6e Respondent's contract had been terminated by Northern Railway and that such termination had neither h"

been stayed nor set aside as on the date of subrri;sion of bids. The interim order of the Hon'ble Delhi High Courr. certains only to debarmenl aspect and does not suspend o negate the subsisting termination. Consequently, the obliga -: tn of the 6ft Respondent to disclose termination remained : rerative and binding in its entirety.

10. Suppression of materiai information o this nature, which has a direct and substantial bearing o r a bidder's eligibili[2, cannot be treated as inconsequenti: [. The legal regime governing tenders requires that evaluatior be conhned strictly lo ther conditions stipulated in the tender cr cument, ald adherence to such conditions is fundamental to me intaining the credibility and fairness of the process. A bidder, rv ro withholds information, which is material and expressly r,: Iuired to be truthfully disclosed, cannot seek to retain the Ldvantage of continued parlicipation in the tender. Such an onr ssion strikes at the core of the eligibilit5r assessment and is rLr t capable of being retrospectively cured by referring to sub s :quent work orders purportedly issued by other authorities or ry relying on the fact that other Railway Zones may have perrr itted the 6fr Respondent to particiBate following the stay of deb I -ment order.

1 1. Respondents' submission that Petitioner had participated in earlier tender processes in which the 6ft Respondent was also a bidder is of no legal relevance to the present controversy. trvery tender process is required to be evaluated independently, strictly in accordance with the terms and conditions set out in the respective tender document' and the validity of the decision challenged herein must be determined solely with reference to the conditions governing this particular tender.

12. It is further noteworthy that another Division of the South Central Railway, namely Guntakal Division' disqualihed the 6h Respondent in a separate tender process on the very ground of the Northern Railway termination' This circumstance demonstrates that other competent authorities have treated termination as a disqualifying factor' The approach adopted by Respondents in the present case, therefore' appears inconsistent with the treatment accorded to the same issue by other divisions and lends support to Petitioner's contention that evaluation undertaken herein did not properly account for the mandatory tender conditions. ru.

13. In view of the foregoing discussion, tt the considered opinion that the decision of Resp and 5 to treat the 6d Respondent as technrr constitutes violation of the mandatory requircr tender. Where eligibility criteria are expressly and prescribed in lhe tender document, neither evaluating authorities are vested with discretion dilute or circumvent them. Once it is shown thar. failed to meet such requirements by suppressing I that were required to be disclosed. decision to bidder cannot be -legally-sustained. Accordingl.. concludes that qualifrcation of the 6e Respondent contrary to the governing tender conditions and vi- disciosure of essential information. The impr_.1 therefore, fails to withstand judicial scrutiny and i set aside.

14. For the foregoing reasons and in view o. recorded hereinabove, this Court hotds that tt Respondents 3,4 and 5 in qualifying the 6trr Re Tender dated 15.05.2025 is contrary to the manrl dqnditions and cannot be sustained. Non-discloslr is Court is of rndents 3, 4 ally-quaiified rents of the tnequivocally bidders nor to overlook, e bidder has raterial facts qualify that this Court is arbitrary, lted by non- ned action, liable to be the findings e action of ;pondent in rtory tender : bv the 6h

Respondent of termination of its Northern Railway contract constitutes a matcrial suppression that vitiates the entire evaluation Process.

Accordingly, the Writ Petition is allowed The qualification of the 6s Respondent in the aforesaid tender process is hereby set aside' Respondents 1 to 5 shall take further steps strictly in accordance with the tender conditions and law. No costs. l6 ConsequentlY, Miscellaneous Applications, if any / shall stand closed //TRUE COPY// SD/- U.SUOHA SISTANTR SECTION OFFICER Nilayam' Secunderabad' RailwaY, Secunderabad- To, rrra Gen€f?l Manager, South Central Railway' Rqi uni"" ot lndia-500003' The Additional General Manager' South Central

. 1t^:t::""'ral' Mechanical Ensineer' South central Railwav' secunderabad- 500003 , U:rf; :,r"rt"5-"J[BBo.'t""k Ensineer-coachins' so-uth Central Railwav' , I::rfilt%FlJ:'r"dXSSI and Housekeepins Manager' south centrar Railwav

6. One CC to SRI PRASAD RAO VEMULAPALLI' Advocate [OPUC]

7. One CC to SRI B'VAMSHIDHAR REDDY' Advocate IOPUCI

8. One CC to SRI V'T'KALYAN' SC FOR CENTRAL GOVT IOPUCI nP.i,",3"*13,i31:rXm:Ull"','i+[Y&ATt':'?ii3:I?Sffi e*ruor

10. Two CD CoPies BSR Y?

HIGH COURT DATED: 1511212025

ORDER

WP.No.23084 of 2025 ALLOWING THE WRIT PETITION, WITHOUT COSTS l-iE .1 uiI ( o

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