Delhi High Court sets aside DDA’s email method to disqualify contractor from tender

The Delhi High Court on Thursday set aside the Delhi Development Authority's (DDA) move to disqualify a contractor from a tender process simply by sending an email and without giving the affected contractor an opportunity to oppose the disqualification [Ms Tekram Enterprises Vs Delhi Development Authority]..Justice Jasmeet Singh observed that such an ex-parte disqualification of a contractor by email would be void for violating principles of natural justice. The Court noted that the DDA's disqualification email was addressed two days before the scheduled draw of lots for the tender, without affording the contractor any opportunity of being heard or even a procedural show cause notice.The Court emphasised that since disqualification involves serious consequences, procedural fairness in such matters are necessary.“To my mind, harsh actions like debarment/disqualification carry profound civil consequences and procedural fairness is the sine qua non for its legitimacy and legality," it said. It went on to hold,"The (DDA's) ex-parte disqualification through an email constitutes a violation of principles of natural justice. Therefore, the impugned decision conveyed by the email is ipso facto void.".The Court was hearing a petition filed by a company called Tekram Enterprises, which had applied to participate in a tender call for maintenance works in sports centres located at various DDA complexes.However, the DDA sent an email on March 25, informing Tekram that it had been disqualified from the tender process. The email was sent two days before the draw of lots for awarding tenders. In the disqualification email, the DDA stated that during the technical scrutiny of the bid, it found that Tekram’s sole proprietor, Arpana Tiwari, had previously been a contractual employee of DDA at one of the sport centres, Paschim Vihar Sports Complex. It added that the applicable tender conditions barred the hiring of contractors who had any relationship with the sports complexes in connection with which the tender bids were invited. .Citing this reason, DDA disqualified Tekram from participating in all tenders concerning various sports centres. Tekram challenged this disqualification before the High Court. On March 27, the Court stayed Tekram’s disqualification, enabling it to participate in the draw of lots for the tender award. Tekram emerged the successful bidder for maintenance works at two sports centres. However, Tekram was not assigned the work since the Court was yet to decide on the validity of the DDA's earlier decision to disqualify it. On April 16, the Court rejected DDA’s grounds for imposing a blanket disqualification on Tekram, observing that such a move was based on erroneous and irrational interpretation of the tender rules. The Court proceeded to grant Tekram relief. It set aside DDA's decision to disqualify Tekram from all tenders, but made it clear that Tekram would remain disqualified from participating in the tender for works at the Vihar Sports Complex.The Court added that though judicial interference into such administrative matters is limited, it could intefere if a decision is arbitrary. .Advocates Deepak Mehra, Vikas Kumar and Vikshit Kumar appeared for the contractor (Tekram Enterprises).Advocate Kritika Gupta appeared for the DDA..[Read judgment]