PROGNOSYS MEDICAL SYSTEMS PRIVATE LTD v. UNION OF INDIA & ANR

1. Present writ petition has been filed under Article 226 of the Constitution of India seeking, inter alia, the following prayers:- “a) Pass an order in nature of writ of Mandamus or any other appropriate writ, order, or direction directing the Respondents to cancel the impugned Tender No. CMSS/PROC/2025-26/NTEP/002 and to initiate a fresh procurement process strictly in accordance with applicable constitutional mandates, public procurement norms, and policies under the Make in India, Atmanirbhar Bharat, and Public Procurement (Preference to Make in India) Orders. b) Direct the Respondents to Re-tender/ Short Tender for procurement of ultraportable X-ray machines, ensuring that ICMR validation and CDSCO licensing are duly recognized and that Indian manufacturers are not arbitrarily excluded; c) Direct the Respondents to reinstate applicable MSME exemptions and eliminate restrictive and exclusionary clauses that unjustifiably disqualify Indian players possessing valid domestic certifications and regulatory approvals; d) Direct the Respondents to ensure that any future tender process upholds the objectives of the “Make in India” and “Atmanirbhar Bharat” initiatives, by providing fair and equitable opportunity to qualified Indian entities with established manufacturing capacity, ICMR validation, CDSCO licensing, and after-sales service capabilities across the country;…”

2. Learned counsel for the petitioner contends that the terms of the subject tender are arbitrary, exclusionary and structurally discriminatory against both, qualified Indian and global manufacturers.

3. It is submitted that a prior e-Tender bearing Tender No.034 (Tender-I) was floated but cancelled even before the submission of bids. Thereafter, another global Tender No.046 (Tender-II) was floated and subsequently cancelled following the stakeholder objections, including from the petitioner, over similar restrictive conditions. It is stated that however, the respondents re-issued Tender No.002 (Tender-III), which replicates and intensifies the same exclusionary framework, mandating consortium bidding between multiple stakeholders, further restricting the tender by eliminating MSME and start-up exemptions, mandating disproportionately high past performance thresholds, and ignoring the Indian regulatory ecosystem entirely.

4. Learned counsel states that the petitioner had made multiple detailed representations during and after the pre-bid meeting, including on 20.05.2025, 29.07.2025, and 30.07.2025, drawing attention to these deficiencies and various restrictive conditions imposed upon the bidders, however, to no avail. Learned counsel for the petitioner also submits that though he had initially participated in the subject tender (Tender-III), he had later withdrawn his bid.

5. On a query by this Court as to the stage of the tender process, Ms. Aakanksha Kaul, learned counsel for respondent no.2/Central Medical Services Society (CMSS) submits that the last date of submission of bids was over long ago and even the financial bids have been opened on 15.07.2025 and the further tender process is underway. She also submits that as the said tender project is being funded by the USA, the process has to be strictly completed in time, without any delay otherwise the funding could be withdrawn, and thus prays that the present petition be dismissed.

6. Having heard the learned counsel for the parties, we are not persuaded to interfere with the tender process in question.

7. Undisputedly, by the letter dated 12.06.2025, the petitioner had withdrawn its bid from the tender in question referred to as Tender-III. Admittedly, withdrawal of the bid by the petitioner by the letter dated 12.06.2025 was itself never withdrawn. Concededly, the technical bid of the petitioner was held to be summarily rejected thereby disqualifying the petitioner on 09.07.2025. The petitioner did not even challenge such disqualification at the relevant time. Except to keep submitting representations on 20.05.2025, 29.07.2025 and 30.07.2025, the petitioner never approached the Court for legal redressal. In the meanwhile, and as per the submission of Ms. Kaul, the last date of submission of bid was long over; that the financial bids of the other bidders too were opened on 15.07.2025 and the tender process is at an advanced stage with every likelihood of the Letter of Intent being issued to the successful bidder in the near future. She also emphasizes that the time was the essence of the tender process in as much as the project under the tender is funded by the USA which may be withdrawn in case the tender process is not completed at the earliest, in all earnest.

8. In similar circumstances, this Court has in the case of Brijesh Kumar vs. Union of India & Anr., W.P.(C) No.9272/2025, dated 17.07.2025, in Para 6 held as under:

9. In the present case, the petitioner claims that it was at its behest that Tender-II, though was floated by the respondent, however, was cancelled following the objections of the stakeholders including the petitioner on account of restrictive conditions. It also claimed that Tender-III also replicated the same exclusionary framework and restrictive conditions.

10. It is not disputed that despite the fact that Tender-III also contained similar restrictive conditions as in Tender-II, the petitioner never challenged the conditions when the Tender-III was notified by the respondent. Undeniably, the petitioner participated in the pre-bid meeting; did submit its bid; withdrew the said bid; and stood disqualified on 09.07.2025. Having not challenged the tender conditions even after having gained the knowledge of notification of Tender-III and till date, we do not see as to how the petitioner would have locus today to challenge those tender conditions, what with the supervening circumstances as noted above.

11. It is no more res integra that a bidder who participates in the tender process and gets disqualified and then challenges the terms and conditions of the tender, has no locus to question those conditions. The Supreme Court in Jagdish Mandal vs. State of Orissa & Ors., (2007) 14 SCC 517, in para 22 held as under: “22. Judicial review of administrative action is intended to prevent arbitrariness, irrationality, unreasonableness, bias and mala fides. Its purpose is to check whether choice or decision is made “lawfully” and not to check whether choice or decision is “sound”. When the power of judicial review is invoked in matters relating to tenders or award of contracts, certain special features should be borne in mind. A contract is a commercial transaction. Evaluating tenders and awarding contracts are essentially commercial functions. Principles of equity and natural justice stay at a distance. If the decision relating to award of contract is bona fide and is in public interest, courts will not, in exercise of power of judicial review, interfere even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. The power of judicial review will not be permitted to be invoked to protect private interest at the cost of public interest, or to decide contractual disputes. The tenderer or contractor with a grievance can always seek damages in a civil court. Attempts by unsuccessful tenderers with imaginary grievances, wounded pride and business rivalry, to make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade courts to interfere by exercising power of judicial review, should be resisted. Such interferences, either interim or final, may hold up public works for years, or delay relief and succour to thousands and millions and may increase the project cost manifold. Therefore, a court before interfering in tender or contractual matters in exercise of power of judicial review, should pose to itself the following questions:

(i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone; OR Whether the process adopted or decision made is so arbitrary and irrational that the court can say: “the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached”;

(ii) Whether public interest is affected.

226. Cases involving blacklisting or imposition of penal consequences on a tenderer/contractor or distribution of State largesse (allotment of sites/shops, grant of licences, dealerships and franchises) stand on a different footing as they may require a higher degree of fairness in action.” [Emphasis supplied] The questions to be considered by a Court, as encapsulated in Jagdish Mandal (supra), if evaluated in the present set of facts, cannot but be answered in the negative. Thus, warranting no interference.