Administrative Law Judicial Review-Scope of Merits of the decision cannot be reviewed Only process of decision making can be reviewed C Grounds for review of administrative action-Irrationality Meaning of Wednesbury reasonableness Modern trend Government contracts-Can be reviewed on the ground of violation of Article 14 of the Constitution of India Terms of invitation to tender not open to review Limitations of courts in review of administrative decisions Constitution of India-Articles 14 and D 226.

Administrative law-Natural Justice-Bias-meaning of test of likelihood of bias-When there can be Government tender-Son of one of the person involved in selection process employed with one of the bidders-The bidder ultimately selected Held, in the facts and circumstances of the case selection is not vitiated by bias-Doctrine of necessity-Applicability of.

Constitution of India Articles 14 and 299 Government contract-Arbitrariness-Government invited tenders for operation of cellular mobile phone service Certain criteria not in the tender introduced to eliminate F tenders Held, it does not vitiate award of contract as all criteria could not have postulated at the beginning itself.

Constitution of India Article 14 and 299-Government con- tract Whether technical irregularity can be condoned without violation Article 14 Government invited tenders for operation of cellular mobile phone service-Terms prohibiting change in the proposed foreign collaborator-One tenderer dropping name of one collaborator out of three Held, does not amount to change in collaborator.

Constitution of India Article 14 and 299-Government con- tract Government inviting tenders for operation of Cellular mobile phone 122 service-One tenderer initially selected was later on dropped without assigning any reasons therefore or hearing-Held, not hearing the tenders violates Natural Justice Administrative Law.

The Department of Telecommunication, Government of India invited tenders from India Companies for grant of licence for the operation of cellular mobile telephone service in Delhi, Bombay, Calcutta and Madras. The tender process consisted of two stages (i) technical evaluation and (ii) financial evaluation. The companies short-listed at the first stage were to be invited at the second stage.

For the purpose of evaluation of tenders and grant of licence, three committees were constituted-(i) Tender Evaluation Committee (TEC) con- sisting of officials of Department of Telecommunication; (ii) Telecom Commission consisting of a Chairman and four members; and (iii) selec- tion Committee or Apex/High Powered Committee. Consisting of the Prin- cipal Secretary to the Prime Minister and there other secretaries of the Government of India.

After the first stage of the tender, 14 companies were short listed and on 30.7.92, financial tenders were issued. The financial tender contained seven criteria for selection for which no marks had been earmarked. The financial bid of the 14 short-listed companies were opened on 17.8.1992 i.e., the cut off date for the financial bid. A second Tender Evaluation Committee examined the bids after devising a marking system for the criteria indicated in the financial tender. Ultimately names of four operators were recommended. Bharti Cellular was the first choice for all the four cities. BPL System and Projects was the second choice for Delhi F and Bombay and Tata Cellular and Skycell were the second chance for Calcutta and Madras. On 10.9.1992, the Chairman of the Telecom Com- mission directed that all the documents alongwith the recommendation of the Tender Evaluation Committee be sent to the Selection Committee for making final recommendations to the Government. On 10.9.1992 itself, the Tender Evaluation Committee's report alongwith the other documents were sent to the High Power Committee. However, a D.O. was issued dissolving the High Power Committee. 

On 9.10.1992 the concerned Minister made a noting on the file that the selection process may be completed by the Department of Telecom munication itself as the High power Committee was taking much time. Accordingly, a final list of 8 companies was prepared. In this final recom- mendation, the Chairman noted that Bharti Cellular, Modi Telecom and Mobile Telecom did not fulfil the condition laid down in clause 2.4.7 of the financial bid which required that the foreign exchange requirement be met by the foreign collaborator of the operator company. In the final recom- mendation, Sterling Cellular was rejected because a C.B.I. investigation was pending against it. Hutchinson Max was rejected on the ground that it had not complied with the operative and technical conditions of the bid. Hutchinson Max had sent a letter explaining that the non-compliance was merely a typographical error and agreeing to comply with all technical, C commercial and general conditions of the bid. The Minister reviewed the final recommendation and reversed the decisions regarding exclusion of Sterling Cellular and one Indian Telecom Ltd. Accordingly, the list of selected operations was recast on 10.10.1992 and the final list prepared was as follows: 

Bombay:

1. Bharti Cellular

2. B.P.L. Projects and Systems

Delhi :

1. Indian Telecom Ltd.

2. Tata Cellular Pvt. Ltd.

Calcutta:

1. Mobile Telecom Ltd.

2. Usha Martin Telecom

Madras :

1. Skycell

2. Sterling Cellular Ltd.

F Four Writ Petitions came to be filed by the rejected companies before the High Court challenging the final list. The writ petitions were disposed off by the High Court by its judgment and order dated 26.2.1993 with certain directions to the Government In pursuance of the Judgment of the High Court, the final list was recasted on 27.8.1993 and following com- Gpanies were selected:

Bombay:

1. Hutchinson Max

Delhi

2. Bharti Cellular

1. B.P.L. Projects and Systems

2. Sterling Cellular Ltd.

Calcutta:

1. India Telecom Ltd.

2. Usha Martin Telecom

Madras :

1. Mobile Telecom Ltd.

2. Skycell

125

The companies aggrieved by the judgment and order of the High B Court, approached this Court in appeal. The main arguments advanced by the appellants before this Court were:

1. The Conditions laid down in clause 2.4.7 of the financial bid was ignored despite there being a clear noting of the chairman in his final recommendations that few companies did not fulfil the conditions of clause 2.4.7. Although Bharti Cellular and mobile Telecom did not fulfil condition 2.4.7, they were selected.

2. One Mrs. Nair, who was the member of the Telecom Commission and later on appointed as Member (Service), had participated in selection proceedings although his son was an employee of BPL Projects and Systems which was one of the Parties to the bid. Mr. Nair had agreed with the recommendation of the Technical Evaluation committee to the effect that names of four firms should be included in the short list condoning their defeciency. One of the firms in respect of which condonation was recommended was B.P.L. Projects and systems itself. The appellants argued that the selection was vitiated by blas.

3. The apex committee was by-passed and the selection process was entrusted to a committee which did not follows the norms.

4. Certain hidden criteria, which were not disclosed earlier, were applied not as parameters, but for elimination. These hidden criterias were:

(a) the foreign collaborator of the bidder must have an experience of handling on lakh Cellular phones or 80000 cellular phones G with Global System for Mobile Communication (GSM) License.

(b) if two bidders have the same collaborator in relation to foreign exchange, that bid will not be consider.

5. For granting license to Bharti Cellular the experience of Talkland of U.K. was considered although Talkland was not a collaborator of Bharti Cellular.

B

6. B.P.L. Projects and systems was allowed to drop the name of Mc. Caw Cellular communications Inc. USA as its foreign collaborator at the second stage of financial bid, although Mc. Caw was originally proposed as a collaborator. This was in violation of clause 7 of Chapter II of the bid document which prohibited change in collaborator stated in the first stage bid.

7. B.P.L. System and Projects submitted its application for foreign collaborator on 22.4.1992 to SIA beyond the cut off date of 31.3.1992.

8. Sterling Cellular was selected despite there being an filed by CBI against it.

9. Tata Cellular was rejected, without assigning any reasons or giving them opportunity of hearing although it was originally selected for Delhi.

10. Hutchison Max was selected although it had not sent the com- pliance report in respect of operative and financial conditions alongwith its offer.

On the basis of arguments advanced, this court framed the following points for determination:

1. What is the scope of judicial review in matters of the present kind?

2. Whether the selection is vitiated by arbitrariness?

3. Whether the contention regarding bias can be upheld?

4. Whether the apex committee has been bypassed?

5. Whether evolving the hidden criteria is valid?

Disposing of the appeals, this Court