Fixing the Bid Blunder: A Legal Lesson in Procurement and Practicality.
14 February 2025
Civil Appeals >> Civil & Consumer Law
The case involves a mistake made by M/s ABCI Infrastructure Pvt. Ltd. (Appellant) in quoting an unrealistic bid amount of Rs. 1,569 for a large-scale project tendered by the Border Roads Organization (BRO). The mistake was discovered shortly after the financial bids were opened, and the Appellant promptly informed BRO of the error, stating that the intended bid was Rs. 1,569 crores. Despite this, BRO refused to acknowledge the mistake and insisted on the bid being valid, even asking the Appellant to justify the quoted amount. BRO subsequently declared the Appellant a defaulter, invoked the bank guarantee, and issued a new tender.
The court ruled that while the Appellant made a clear mistake, BRO should have taken a more practical approach by accepting the error. The court also found that the delays caused by BRO were unjustified and that the mistake could have been rectified sooner. In light of these findings, the court directed the Appellant to pay Rs. 1 crore to BRO, after which the bank guarantee of Rs. 15.04 crores should be returned. The earlier judgment dismissing the writ petition was set aside, and the appeal was allowed.
Section 20, Indian Contract Act - 1872