The Supreme Court has upheld an award for piped gas distribution network in Chennai and Tiruvallur districts in Tamil Nadu to a Gujarat-based firm by the Petroleum and Natural Gas Regulatory Board (PNGRB).
A bench of Justices D Y Chandrachud and Hemant Gupta dismissed the appeal filed by Adani Gas Limited and others and justified the action of PNGRB saying that calling the bidders with the highest composite scores cannot be faulted.
The Board had granted the award for piped gas distribution network in Puducherry to AG & P LNG, in Chennai and Tiruvallur districts to Torrent Gas Private Limited and to SKN Haryana in Kanchipuram district in 2018.
The top court said there is no merit in the submission that there was a breach of the principles of “natural justice” in calling only the bidders with the highest composite score to explain the reasonableness of their bids.
“In the present situation, when the Board decided to call the bidders with the highest composite score in order to allow them an opportunity to explain reasonableness of their bid, the administrative decision taken by the Board cannot be faulted as being in violation of the principles of natural justice,” it said.
The bench said if the Board Note of July 23, 2018 on the reasonability of bidding parameters was to be construed in the manner in which the applicants had urged, the automatic disqualification of bidders based on a criterion introduced by the Board Note would raise serious doubts about its fairness and legality.
“This is because the Board Note was not notified to bidders as a basis for the evaluation of bids before the date for the submission of the bids had closed. To disqualify a bidder on the basis of a criterion which was not notified and of which bidders had no knowledge would be arbitrary and would constitute an infraction of Article 14.
“The Board was thus correct in determining that the automatic disqualification of a bid on the basis of a criterion specified in the Board Note (which was never notified to the bidders) would not be legally correct.