Bidder’s Technical Rejection Dispute Withdrawn, Fresh Filing Allowed by Calcutta High Court

Case Name

Gobinda Mandal Vs The State of West Bengal & ors (High Court of Calcutta)

W.P.A. 5800 of 2025

Date: 22nd May 2025

Key Takeaways

• The court did not decide on the merits of the technical bid rejection but allowed the petitioner to withdraw and refile.
• The dispute centered on whether an audited balance sheet was required for a tender where the total estimate was below ₹1 crore, referencing Section 44AB of the Income Tax Act.
• The Pradhan’s authority to reject the bid was questioned, citing the Procurement Manual, 2014, which requires such decisions to be made by a committee.
• The petitioner had already approached the Block Development Officer (BDO), who passed an order on the matter.
• The court’s order vacated any interim relief and disposed of all connected applications, with no order as to costs.

Issue

Was the rejection of Gobinda Mandal’s technical bid for not submitting an audited balance sheet valid, and was the Pradhan authorized to make this decision?

Facts

• Parties: Gobinda Mandal (petitioner) vs. The State of West Bengal & others (respondents, including the Pradhan of Bulbulchandi Gram Panchayat, Malda).
• Event: Gobinda Mandal participated in e-tenders (Nos. 03(e)/BBCGP/2025 and 04(e)/BBCGP/2025) for various works.
• Dispute: His technical bid was rejected because he did not submit an audited balance sheet.
• Petitioner’s Stand: He argued that since the total work estimate was below ₹1 crore, Section 44AB of the Income Tax Act did not require an audited balance sheet. He also submitted a balance sheet signed by a Chartered Accountant.
• Authority Questioned: The petitioner claimed the Pradhan alone could not reject the bid; such decisions should be made by a committee as per the Procurement Manual, 2014.
• Further Action: The petitioner made a representation to the Block Development Officer (BDO), who passed an order on 7th March 2025.

Arguments

Petitioner (Gobinda Mandal)

• The requirement for an audited balance sheet under Section 44AB of the Income Tax Act applies only if turnover exceeds ₹1 crore, which was not the case here.
• The Pradhan was not authorized to reject the bid; the decision should have been made by a committee (Procurement Manual, 2014).
• Submitted a balance sheet signed by a Chartered Accountant.
• Cited an unreported decision: Simarul Sekh & anr – versus- The State of West Bengal & ors (WPA 3409 of 2025).

Respondents (State & Panchayat)

• The petitioner’s representation was already considered by the BDO, who passed an order on 7th March 2025, communicated to the petitioner.
• The petitioner had not challenged the BDO’s order in the current writ.

Key Legal Precedents

• Section 44AB of the Income Tax Act: Requires audited balance sheets only for entities with turnover above ₹1 crore.
• Procurement Manual, 2014: Specifies that bid rejection decisions should be made by a committee, not solely by the Pradhan.
• Unreported Decision: Simarul Sekh & anr – versus- The State of West Bengal & ors (WPA 3409 of 2025) (relied upon by the petitioner).

Judgement

• The court noted that the BDO had already passed an order on the petitioner’s representation, which was not challenged in this writ.
• The petitioner sought to withdraw the writ petition with liberty to file afresh.
• The court dismissed the writ petition as withdrawn, granting liberty to file a fresh petition if desired.
• All connected applications were disposed of, and any interim orders were vacated.
• No order as to costs.
• The order was passed by Justice Bivas Pattanayak.

FAQs

Q1: Why was Gobinda Mandal’s bid rejected?

A: His technical bid was rejected for not submitting an audited balance sheet, which he argued was not required as the work estimate was below ₹1 crore.

Q2: Who is supposed to decide on bid rejections in Gram Panchayat tenders?

A: According to the Procurement Manual, 2014, such decisions should be made by a committee, not just the Pradhan.

Q3: What did the court decide?

A: The court allowed the petitioner to withdraw his case with the liberty to file a fresh petition, as the BDO had already passed an order on his representation.

Q4: Was the legality of the bid rejection decided?

A: No, the court did not rule on the merits of the rejection but focused on procedural aspects and allowed for a fresh petition.

Q5: What happens next for the petitioner?

A: Gobinda Mandal can file a new petition challenging the BDO’s order if he wishes.