M/S ABCI INFRASTRUCTURES PVT. LTD. versus UNION OF INDIA AND OTHERS

M/S ABCI INFRASTRUCTURES PVT. LTD. versus UNION OF INDIA AND OTHERS

Although the appellant made a clear, patent mistake in the financial bid (quoting Rs.1,569/- instead of Rs.1,569 crores) and the plea of system glitch was rejected, BRO acted unreasonably and rigidly by insisting on acceptance, declaring the appellant a defaulter and encashing the bank guarantee; applying equitable principles and proportionality the Court allowed the appeal, set aside the High Court decision and directed a modest, proportionate remedy (appellant to pay Rs.1 crore and BRO to return the bank guarantee/demand draft of Rs.15.04 crores on receipt).

Parties
Appellant: M/s ABCI Infrastructures Pvt. Ltd.; Respondents: Union of India and Others
Jurisdiction
India
Judgment Date
13 February 2025
Procedural Posture
Civil Appeal No. 2546 of 2025 / On Appeal From High Court of Himachal Pradesh Judgment Dated 07.10.2023
Outcome
Appeal allowed; impugned High Court judgment set aside
Legal Topics
Mistake of Fact, Forfeiture of Bid Security, Bank Guarantee, Relief in Equity, Proportionality, Typographical/system Error in Online Bids, Cancellation of Bid
Contract Law Public Procurement / Tenders Administrative Law Equity Mistake of Fact Forfeiture of Bid Security Bank Guarantee Relief in Equity +3 more

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Parties

M/s ABCI Infrastructures Pvt. Ltd.

Appellant

Union of India and Others

Respondents

Procedural Posture

Civil Appeal No. 2546 of 2025 / On Appeal From High Court of Himachal Pradesh Judgment Dated 07.10.2023

Legal Issues

  1. 1 Whether BRO was justified in accepting the manifestly erroneous bid of Rs.1,569/- and in encashing the appellant's bank guarantee of Rs.15,04,64,000/-
  2. 2 Whether the appellant's claimed typographical or system error could attract equitable relief under Section 20 of the Indian Contract Act or other equitable doctrines

Ratio Decidendi

Although the appellant made a clear, patent mistake in the financial bid (quoting Rs.1,569/- instead of Rs.1,569 crores) and the plea of system glitch was rejected, BRO acted unreasonably and rigidly by insisting on acceptance, declaring the appellant a defaulter and encashing the bank guarantee; applying equitable principles and proportionality the Court allowed the appeal, set aside the High Court decision and directed a modest, proportionate remedy (appellant to pay Rs.1 crore and BRO to return the bank guarantee/demand draft of Rs.15.04 crores on receipt).

Court Disposition

Appeal allowed; impugned High Court judgment set aside

Orders

  • Impugned judgment dated 07.10.2023 of the High Court of Himachal Pradesh set aside
  • Appellant directed to pay Rs.1,00,00,000 (Rs.1 crore) to BRO