Introduction:
In the matter of Maha Mineral Mining & Benefication Pvt. Ltd. versus Madhya Pradesh Power Generating Co. Ltd. & Another, the Supreme Court of India delivered a significant ruling on September 9, 2025, that clarified the legal boundaries governing tender processes and bid rejections. A division bench comprising Justice Surya Kant and Justice Joymalya Bagchi set aside the Madhya Pradesh High Court’s judgment that had upheld the disqualification of Maha Mineral’s bid. The controversy arose when Madhya Pradesh Power Generating Co. Ltd. issued a tender for coal beneficiation and logistics, and Maha Mineral, the appellant, relied on its experience as a 45% partner in Hind Maha Mineral LLP. The appellant submitted a Work Execution Certificate issued by Maharashtra State Mining Corporation (MSMC) to demonstrate past experience. However, the Tender Committee disqualified the bid, reasoning that the appellant failed to submit the Joint Venture (JV) agreement, which it deemed indispensable, even though the Notice Inviting Tender (NIT) did not mandate such submission. The High Court upheld this disqualification, leading Maha Mineral to approach the Supreme Court. The apex court observed that a bid cannot be rejected for non-production of a document that was never prescribed in the NIT. The Court held that the Tender Committee had acted contrary to the tender’s terms and unfairly disqualified the appellant. However, the Court also noted that there was a pending issue regarding washery capacity under Clause 5(B), which had been raised belatedly in written submissions, depriving the appellant of a fair chance to rebut. On this limited issue, the matter was remanded back to the High Court for fresh adjudication within two months.
Arguments of the Appellant:
The appellant, Maha Mineral Mining & Benefication Pvt. Ltd., through its counsel, argued that its disqualification was arbitrary, unjustified, and against the principles of fairness in tendering. It was submitted that Clause 5(D) of the NIT did not mandate the production of a Joint Venture Agreement as a precondition for relying on past experience of a consortium in which the bidder had a definite proportionate share. Instead, the appellant contended that it had provided ample documentary proof of its participation in the joint venture through a Work Execution Certificate issued by Maharashtra State Mining Corporation (MSMC). This certificate confirmed its 45% share in Hind Maha Mineral LLP and specifically referenced the JV arrangement. The appellant emphasized that this certificate sufficiently demonstrated its credentials and capability to execute the work.
The appellant further contended that the Tender Committee acted beyond the scope of the NIT by imposing an additional requirement that was never prescribed. Such an action not only amounted to rewriting the tender terms but also undermined the principle that tenders must be evaluated strictly on the basis of the conditions expressly laid out. Counsel for the appellant argued that courts have consistently held that tender conditions must be construed strictly, and tender authorities cannot add or subtract requirements at their own discretion. They stressed that by disqualifying the bid on a non-existent ground, the Tender Committee deprived the appellant of the right to fair consideration, which is an essential component of Article 14 of the Constitution of India.
The appellant also challenged the High Court’s approach, stating that the High Court not only failed to recognize the arbitrariness in the Tender Committee’s decision but also erroneously upheld the disqualification by giving weight to the absence of the JV agreement, even though this was never an original ground for rejection. According to the appellant, the High Court effectively substituted its own reasoning for that of the Tender Committee, which is impermissible in judicial review of tender matters. Additionally, the appellant pointed out that the allegation about the washery capacity being tied up with MSMC was introduced for the first time in written submissions before the High Court, which violated principles of natural justice since the appellant was denied the opportunity to rebut with evidence. Therefore, the appellant requested that the disqualification be set aside and the matter be decided strictly in line with the terms of the NIT.
Arguments of the Respondents:
On the other hand, the respondents, led by Madhya Pradesh Power Generating Co. Ltd. and represented by senior counsels, defended the disqualification on the grounds that the appellant had failed to furnish adequate proof of its joint venture experience. The respondents contended that the Work Execution Certificate provided by the appellant merely referenced the joint venture and indicated a 45% share but did not produce the foundational JV agreement itself. According to the respondents, the JV agreement was crucial to verify the appellant’s exact role, responsibilities, and performance obligations within the consortium. Without such a document, the respondents argued, the authenticity and reliability of the appellant’s claim could not be thoroughly assessed.
The respondents further argued that tender processes involve a high degree of scrutiny to ensure fairness, transparency, and the selection of the most competent bidders. They maintained that it was within the prerogative of the Tender Committee to seek comprehensive documentation, including the JV agreement, even if not expressly stated in the NIT, because such documentation directly impacted the evaluation of the bidder’s credentials. They contended that the appellant’s reliance solely on the Work Execution Certificate amounted to partial disclosure, and the absence of the JV agreement raised doubts regarding the precise allocation of responsibilities and performance history within the consortium.
The respondents also defended the High Court’s judgment, asserting that the Court had not erred in upholding the disqualification. They argued that judicial review in tender matters must be limited and courts should refrain from interfering in technical evaluations by expert committees unless there is gross arbitrariness or mala fides, neither of which was evident in this case. The respondents also brought up the issue of washery capacity, stating that the appellant’s capacity was already tied up with MSMC and thus not available for the tender work. According to them, this further undermined the appellant’s eligibility. They submitted that ensuring sufficient washery capacity was a mandatory requirement under Clause 5(B) of the NIT and that the appellant failed to prove its capacity was independently available. Therefore, the respondents requested the Supreme Court to uphold the High Court’s decision and dismiss the appeal.
Court’s Judgment:
After carefully considering the submissions of both parties, the Supreme Court delivered a nuanced judgment that underscored fundamental principles of fairness, transparency, and adherence to tender conditions. The bench of Justices Surya Kant and Joymalya Bagchi observed that the central question was whether the Tender Committee was justified in rejecting Maha Mineral’s bid for non-production of the JV agreement when Clause 5(D) of the NIT did not mandate its submission. The Court held that the rejection was unjustified and contrary to the terms of the NIT.
The Court emphasized that tender authorities cannot impose conditions that are not expressly stated in the tender document. The NIT forms the binding framework within which bids must be evaluated, and any deviation from its explicit terms amounts to arbitrariness. In this case, Clause 5(D) did not prescribe the production of a JV agreement as mandatory. The appellant had produced a Work Execution Certificate issued by MSMC, which clearly reflected its 45% share in the joint venture and confirmed the execution of work. Therefore, the Court concluded that the appellant had sufficiently demonstrated its past experience and capacity in compliance with the NIT.
The Court also disapproved of the High Court’s reasoning, noting that it effectively upheld the disqualification on a ground that was not part of the Tender Committee’s original reasoning. Judicial review, the Court noted, is confined to examining whether the decision-making process was lawful and reasonable; it does not extend to substituting new grounds to justify a decision. By endorsing the requirement of the JV agreement, the High Court introduced a ground extraneous to the tender conditions and the committee’s reasoning, which was impermissible.
However, the Supreme Court also addressed the issue of washery capacity under Clause 5(B). It noted that the allegation that the appellant’s washery capacity was tied up with MSMC was raised belatedly in written submissions, which deprived the appellant of an opportunity to rebut the allegation with evidence. This, the Court held, was a violation of natural justice. Consequently, while setting aside the rejection of the bid for non-production of the JV agreement, the Court remanded the matter to the High Court for limited adjudication on the issue of washery capacity. The High Court was directed to decide this issue within two months.
In conclusion, the Supreme Court partly allowed the appeal, thereby reinforcing the principle that tender authorities cannot go beyond the terms of the NIT to invent new disqualifications. The ruling serves as a reminder to both tender committees and courts that transparency, fairness, and strict adherence to tender terms are the bedrock of public procurement processes.