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06th May 2024

Validity of a restrictive clause in a Tender to prevent single entity with common ownership from submitting multiple bids

On 13.09.2023, a Division Bench of the High Court of Delhi[“HC”] dismissed five interconnected writ petitions joint largely on the ground of welfare and fairness principles in the public procurement matters. [Refer Silica Udyog India Pvt. Ltd. and Others v. Union of India and Others, 2023 SCC OnLine Del 5632] The writ petitions primarily challenged the eligibility criteria enumerated in the revised Notice Inviting Tenders [“NITs”] floated by the three leading Oil Marketing Companies - HPCL, BPCL, and IOCL. The HC found no compelling reason for judicial interference in the matter as there was lack of evidence to suggest the revised clauses in NITs to be arbitrary, discriminatory, or introduced with malafide intent. In this backdrop, the arguments for and against the validity of a restrictive clause in a tender have been discussed in this short article.

  • Corporate & Commercial
  • Litigation