Safiya Malik

The High Court of Delhi Single Bench of Justice Jyoti Singh dismissed a challenge to a two‑year debarment imposed by a public authority and affirmed that the administrative decision “warrants no interference” in writ jurisdiction. The Court held that the action impugned—an order debarring a bidder from participating in tenders—had been preceded by due notice, consideration of the bidder’s representation, and a reasoned determination by the competent authority. The Bench declined to set aside or modify the period of debarment and rejected the prayer for ancillary reliefs.

The Court clarified that the findings are confined to adjudication under Article 226 pertaining to the debarment decision and do not affect ongoing criminal proceedings referenced in the matter. Consequent to this conclusion, the writ petition and the pending application were dismissed. The conclusion records that nothing stated in the judgment shall bear upon the criminal case, which will be decided on its own merits.

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A procurement was initiated for supply of 4,159 pre‑loaded electronic tablets on the Government e‑Marketplace (GeM). The bidding entity participated as an authorized representative of an Original Equipment Manufacturer (OEM) under a bid‑specific authorization. As part of the bid, a turnover certificate of the OEM dated 24 March 2022 was uploaded. During technical evaluation, a complaint was received alleging that the uploaded turnover certificate was forged. The procuring entity sought verification from the bidder, stating that the certificate “appeared to be forged,” and required confirmation of authenticity.

Following the communication, the bidder internally sought written explanations from its employees who handled the bidding process and convened a Board meeting to initiate an internal inquiry. An advocate was appointed as an Inquiry Officer. Written responses were collected, and multiple employees were examined. In the internal proceedings, two employees acknowledged that the figure in the turnover certificate had been edited, changing the turnover from Rs. 28,20,10,671/‑ to Rs. 1,28,20,10,671/‑ to satisfy eligibility criteria. The internal material stated that the management had not been informed of these changes. The bidder claimed to have terminated the services of the employees based on the inquiry findings.

In parallel, the procuring authority issued a show cause notice to the bidder, and also sought an explanation from the OEM. The OEM, in its communications, maintained that the forged turnover certificate was not the document it had supplied; it stated that the turnover certificate shared earlier reflected the correct turnover of Rs. 28,20,10,671/‑ and produced the prior email with the attachment during the personal hearing.

Initially, the procuring authority issued a blacklisting order for three years. That order was later quashed in separate proceedings on the grounds that the bidder’s explanation had not been adequately considered, that there was no opportunity to respond to reliance on the General Financial Rules (GFR), and that the order was non‑speaking. Liberty was granted to proceed afresh with a show cause notice and pass a reasoned order after considering the bidder’s representation.

Pursuant thereto, a fresh show cause notice was issued. The bidder furnished a detailed reply and was granted a personal hearing. In the ensuing order, the procuring authority concluded that a forged turnover certificate had been submitted with the bid and determined to debar the bidder from participating in tenders for a period of two years from the date of the order. The decision recorded the authority’s view that the bidder could not shift responsibility to employees acting in the course of their assigned duties and that submission of forged bid documents struck at the sanctity of the tender process.

In the writ proceedings culminating in the present judgment, the bidder challenged the debarment order and sought, inter alia, its quashing, restraint on web publication, non‑coercive measures pending a complaint case, and return of the bank guarantee amount. The bidder’s case, as recounted by the Court, rested on the assertions that management was unaware of the forgery; that the internal inquiry established individual employee misconduct and a role of a representative associated with the OEM; that criminal complaints had been initiated; and that the bidder’s track record over decades of public sector engagements was unblemished.

The bidder invoked the Supreme Court’s decision in Kulja Industries Limited v. Chief General Manager, BSNL to contend that blacklisting requires consideration of specified mitigating factors, including past conduct, responsibility taken, corrective actions, and whether wrongdoing was pervasive or limited to individuals in non‑senior positions. It was argued that the competent authority had failed to apply these considerations and that the penalty was disproportionate.

The procuring authority’s position, as summarized in the judgment, was that the submission of a forged document with the bid justified debarment after due process. It was stated that the bidder had admitted the forgery during the proceedings, even if attributing it to employees, and that responsibility could not be avoided because the acts had been performed in the course of employment.

The authority referred to the applicable GFR provisions: the Code of Integrity and debarment clauses permitting exclusion for up to two years for contravention after a reasonable opportunity of being heard. It was recorded that a pre‑integrity pact and the GeM General Terms and Conditions also contemplated administrative actions such as suspension or debarment for false or forged information.

The OEM’s submissions, as captured by the Court, included that the turnover certificate it had sent to the bidder prior to bid submission reflected the correct turnover; that the forged document uploaded during bidding differed from the one supplied; and that its financial information and certifications were updated on the GeM portal. The OEM opposed any attribution of forgery to it and noted that investigations by both the procuring authority and the GeM platform had not resulted in adverse findings against the OEM.

Among other factual details, the judgment records that the tender was a high‑value procurement; that the minimum turnover under the tender conditions was Rs. 3,743 lakhs; that the uploaded certificate showed Rs. 1,28,20,10,671/‑ whereas the actual turnover was Rs. 28,20,10,671/‑; and that the bidder’s employees were authorized to handle tender submissions, including document scrutiny and uploading. The Court also noted the subsequent short‑term debarment by the GeM portal for 60 days in a separate administrative action, which had not been challenged.

The Court set out the parties’ legal positions at length, including the bidder’s reliance on case law regarding proportionality and vicarious liability, and the authority’s reliance on principles of vicarious responsibility for acts committed in the course of employment and on policy instruments governing procurement integrity. The materials referenced in the judgment include show cause notices, the bidder’s representations, internal inquiry records, communications, and the final order under challenge.

The Court recorded the core issue for determination as whether the bidder could avoid vicarious liability for the forgery committed by employees acting in the course of their employment. It stated that responsibility attaches when acts are performed under authorization and within the scope of assigned duties. The Court set out the doctrinal basis with reference to authorities on vicarious liability in employment.

The judgment stated: “From the conspectus of the aforesaid judgments, it is luminously clear that an employer or a master cannot distance himself from the acts or omissions of the employee/servant where the acts or omissions are in the course of employment and authorized by the employer/master, even if the acts or omissions are through wrongful and unauthorized modes so long as they have a direct nexus with the employment.”

The Court added: “In the instant case, it is an admitted case of the Petitioner that Sh. Puspendra Singh was duly authorized to take necessary steps towards the bidding process and therefore his act of submitting the bid documents, including the forged Turnover Certificate was an act in the course of employment.” It concluded: “Therefore, once the bidding process was carried out by an employee, authorized by the Petitioner to do that act, Petitioner cannot distance itself and contend that it be absolved of the liability.”

On the factual matrix, the Court noted: “A significant aspect of this case, which weighs heavily against the Petitioner is that there is no dispute that the Turnover Certificate was forged. It is equally undisputed that the Certificate was uploaded by employees of the Petitioner, duly authorized to process and submit the tender documents.” It recorded that the OEM had taken a categorical stand that the document it had provided reflected the correct turnover and that email and attachment were shown during the personal hearing.

Addressing the submission premised on limited management knowledge, the Court recorded: “The onus of submitting factually correct information and documents was on the Petitioner… assuming that [management] did [distance itself], it was at its own peril and NDMC cannot be faulted for taking action once it was clear that a forged bid document had been submitted.” It observed that the ultimate beneficiary of an award would be the bidder, and set out that “the sanctity of a tender process is required to be maintained and therefore, a party which indulges in wrongdoings at the stage of bidding cannot be heard to say that no penalty should be imposed.”

On the invocation of Kulja Industries concerning proportionality and mitigating factors, the Court stated: “In my view, it is not open for the Petitioner to contend that the Competent Authority of NDMC has not taken into consideration the factors enumerated in the guidelines… Petitioner had made a detailed representation… Impugned order dated 07.06.2024 reflects that the representation was taken into consideration by the Competent Authority before taking a decision in the matter along with mitigating factors… NDMC was of the view that blacklisting for two years was the appropriate action. The order is a reasoned order holding that Petitioner cannot claim innocence by placing the onus of forging bid documents on its employees who indulged in forgery during the course of official discharge of their duties.”

Regarding procedural fairness, the Court recorded that the bidder had been issued a fresh show cause notice after the earlier order was quashed, had submitted a written response, and had been granted a personal hearing; it noted that “Petitioner was put to notice before taking the action of blacklisting.” The judgment referred to the policy framework, including GFR provisions on the Code of Integrity and debarment, as well as the pre‑integrity pact and GeM terms that contemplate administrative measures where forged or false information is furnished.

The Court also addressed the internal inquiry. It stated: “Respondents are right in their submission that this is a self‑serving internal inquiry of the Petitioner, without involving NDMC or the OEM, whose Turnover Certificate was in question… management of the Petitioner cannot absolve itself even if the confessional statements were voluntarily made by applying the principle of vicarious liability and thus, the holding of the in‑house inquiry and/or its report cannot rescue the Petitioner insofar as NDMC is concerned.”

On comparative precedents, the Court distinguished authorities cited by the bidder and referred to debarment jurisprudence affirming that exclusion is a recognized, time‑bound tool to protect public interest. The judgment observed that debarment periods vary with the nature of the misconduct and recorded that the competent authority’s two‑year period was not shown to be arbitrary given the facts that a forged document had been used at the bidding stage and that responsibility lay with the bidder for acts of its authorized employees.

The Court ultimately concluded: “For the aforesaid reasons, the impugned order warrants no interference by this Court in exercise of its writ jurisdiction.” It added a clarificatory note that the judgment would not affect the criminal proceedings referred to in the record: “It is, however, made clear that nothing stated in this judgment will have any bearing in the pending criminal case referred to above and the same shall be decided on its own merit.”

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The judgement records that the writ petition fails and is dismissed. The judgment states: “For the aforesaid reasons, the impugned order warrants no interference by this Court in exercise of its writ jurisdiction and the present petition is dismissed along with pending application.” There is no modification to the period of debarment recorded in the administrative order, and no direction is issued to the procuring authority to reconsider or reduce the penalty.

The Court does not grant the prayer to restrain publication of the impugned order on the procuring authority’s website, nor does it direct the return of the bank guarantee amount. The Court does not pass any injunction against further coercive action linked to the internal or external proceedings described in the materials. The judgment includes a clarification in respect of separate criminal proceedings: “It is, however, made clear that nothing stated in this judgment will have any bearing in the pending criminal case referred to above and the same shall be decided on its own merit.”

Advocates Representing the Parties:

For the Petitioners: Mr. Dayan Krishnan, Senior Advocate with Mr. Manoranjan Sharma, Mr. Rajat Joneja and Mr. Anmol Kumar, Advocates.

For the Respondents: Mr. Arun Birbal and Mr. Sanjay Singh, Advocates for R‑1/NDMC; Mr. Ashish Prasad, Mr. Sam C. Mathew and Ms. Madhuri Mittal, Advocates for R‑2.

Case Title: CCS Computers Private Limited v. New Delhi Municipal Council & Anr.

Neutral Citation: 2025: DHC:6606

Case Number: W.P.(C) 11006/2024; CM APPL. 45418/2024

Bench: Justice Jyoti Singh