Introduction

In a ruling of far-reaching importance for public procurement law, the Supreme Court in Prakash Asphaltings & Toll Highways (India) Ltd. v. Mandeepa Enterprises (Civil Appeal No. 11418 of 2025, decided on 12 September 2025) has once again reinforced the principle that tender conditions must be strictly adhered to, and post-bid corrections cannot be entertained, even if such corrections could yield higher revenue to the state exchequer.

By way of this judgment, the Court overturned the Calcutta High Court Division Bench’s ruling that had allowed rectification of a bid on the ground of an inadvertent error, thereby drawing a clear line on the limits of judicial intervention in tender matters.

Background

The case arose from a notice inviting electronic bids by the Government of West Bengal for the collection of Road User Fees (‘RUF’) for a contract period of 1095 days. The tender process involved a two-bid system (technical and financial) to be submitted concurrently. The tender documents left no room for ambiguity. Clause 4(g) categorically stipulated that any change in template of Bill of Quantity (‘BOQ’) will not be accepted under any circumstances.

Seven bidders participated in the Bidding Process, and four, including the Prakash Asphaltings and Toll Highways (India) Limited (‘Appellant’) and Mandeepa Enterprises (‘Respondent No. 1’), were declared technically qualified. Upon the opening of financial bids, the Appellant emerged as the highest bidder (‘H1’) with an offer of Rs. 91,19,00,000.00 In stark contrast, Respondent No. 1 was the lowest bidder (‘H4’), having quoted Rs. 9,72,999.00. The BOQ template clearly required the amount to be entered for the full 1095-day period.

Only after the financial bids were made public did Respondent No. 1 seek to rework its bid. It sent an email to the tendering authority claiming its quoted price was an “inadvertent error”. It contended that the quoted amount was a per day figure and requested that it be multiplied by 1095, resulting in a revised bid of Rs. 106,54,33,905.00. This would have made it the highest bidder by a margin of over Rs. 15 crores. The tendering authority rejected this request, observing that such a post-bid alteration would “impeach the sanctity of the tender process”.

The Litigation Trail

Aggrieved by the rejection of its request for correction, Respondent No. 1 invoked the writ jurisdiction of the Calcutta High Court. The Single Judge dismissed the petition, holding that allowing such a correction after the bids were opened would be contrary to every known principle of fairness and would upset the entire tender process pertaining to tenders.

On appeal, however, the Division Bench took a markedly different view and reversed the Single Judge’s order. Adopting an expansive interpretation of the tender terms, the Bench held that:

  • Clause 5B(v)[1] Latitude: The Division Bench interpreted Clause 5B(v) of the “Instructions to Bidders” as giving the tendering authority “sufficient leverage” to seek clarification not just at the stage of technical evaluation, but throughout the tender process up to issuance of the work order.
  • Treatment of the Bid as a Daily Rate: Proceeding on this premise, it directed that Mandeepa’s quoted figure of Rs. 9,72,999 be treated as a per-day rate and recomputed for the entire 1,095-day period, yielding a revised figure of Rs. 106.54 crores, thereby making it the highest bid on paper.
  • Opportunity to Competing Bidders: However, since other bidders were not present before the court, the Division Bench the Bench further directed that all other technically qualified bidders be afforded an opportunity to ‘match’ Mandeepa’s recomputed bid before the final award of the contract.

Key Issues Before the Supreme Court

1.  Whether a bidder can be permitted to rectify a mistake in its financial bid after the bids have been opened.

2.  Whether a clause allowing for “clarification” can be interpreted to permit a fundamental change to a financial bid.

3.  Whether the non-impleadment of the successful (H1) bidder in the High Court proceedings violated the principles of natural justice.

4.  How to balance the public interest in maximising revenue against the need to maintain the sanctity of the tender process?

Supreme Court’s Findings

Allowing the appeal preferred by Prakash Asphaltings, the Supreme Court restored the Single Judge’s decision and set aside the Calcutta High Court Division Bench’s order. Rendering a clear and decisive judgment, the Court laid down the following key findings:

1.Strict Compliance with Tender Conditions

  • Clause 4(g) of the tender explicitly barred any modification of the BOQ “under any circumstances.”
  • Permitting a correction after the financial bids had been opened would directly contravene this clause and undermine the finality of the bidding process. Such a practice would create uncertainty and open the door to manipulation.
  • The Court reiterated that the sanctity of the tender process is itself a matter of public interest, an interest far higher than merely extracting the highest monetary return for the State.

2.Wrong Interpretation of Clause 5B(v) by the Division Bench

  • The Court found the Division Bench’s interpretation of Clause 5B(v) of the Instructions to Bidders, to be erroneous and overly broad, insofar as it allows the authority to seek clarifications on documents already submitted.
  • The Supreme Court clarified that this clause is limited to seeking explanatory information on existing documents, not for allowing a substantive rectification of the BOQ rate.
  • Clause 5B(v) had to be read alongside Clause 4(g), which placed a complete embargo on any changes to the BOQ template “under any circumstances”. To interpret it otherwise would dilute Clause 4(g) and destabilize the entire bidding framework.

3.No Shelter in “Inadvertent Mistake”

  • The BOQ template clearly required bidders to quote the total amount for the full 1,095-day period, not a daily rate.
  • Respondent No. 1 filled in Rs. 9,72,999 in both figures and words without any indication that it was a per-day figure
  • The Court held that such conduct was not a bona fide or inadvertent error but a failure of vigilance for which the bidder alone must bear the consequences.

4.Public Interest Extends Beyond Revenue Maximization

  • The Court underscored that public interest in government contracting encompasses far more than the pursuit of higher revenue.
  • The Supreme Court emphasized that public interest in commercial transactions is a broad concept. While maximizing revenue is important, upholding the stability of contracts and the fairness of the procurement process is equally, if not more, critical.
  • Allowing post-bid alterations would set a dangerous precedent and delay the execution of public works.

5.Violation of Natural Justice

  • The Court held that Prakash Asphaltings, the declared H1 bidder, was a necessary party to the High Court proceedings.
  • The Division Bench’s order had direct adverse civil consequences for the Appellant, downgrading its H1 status without giving it an opportunity to be heard.
  • Such omission, the Court held, constituted a clear violation of the principles of natural justice and by itself impugned vitiate the judgment.

Key Precedents Relied Upon

The Court reaffirmed settled principles from:

  • West Bengal SEB v. Patel Engineering Co. Ltd. (2001) 2 SCC 451: mistakes in bids cannot be rectified post-submission.
  • Jagdish Mandal v. State of Orissa (2007) 14 SCC 517: judicial review in tender matters is limited to arbitrariness, mala fides, or public interest violations.
  • Afcons Infrastructure Ltd. v. Nagpur Metro Rail Corporation Ltd. (2016) 16 SCC 818: tender terms must be given full effect, and courts should defer to the interpretation of the tendering authority.

Conclusion

The Supreme Court’s decision in Prakash Asphaltings serves as an important reminder for all stakeholders in public procurement. By setting aside the High Court’s lenient view, the Supreme Court has reaffirmed that tender conditions are sacrosanct and not subject to reinterpretation once bids are opened, even where the State might ostensibly stand to gain a higher revenue. The onus is on bidders to ensure their bids are submitted accurately and in compliance with all tender conditions. A plea of an “inadvertent mistake” will find little sympathy when raised after competitors’ bids are disclosed.

For bidders, the ruling highlights the need for strict vigilance, diligence, and accuracy at the stage of bid submission, as post-bid corrections are legally impermissible. For tendering authorities, it strengthens the mandate to enforce procedural rigor and reject any negotiations or clarifications that would alter substantive terms.

Most importantly, the Supreme Court reaffirmed that public interest in procurement lies not only in maximizing revenue but also in safeguarding the fairness, certainty, and integrity of the process. This decision firmly brings down the shutters on post-bid alterations, ensuring that tenders remain a transparent and level playing field for all participants.

[1] 5B(v). While evaluation the Notice Inviting Authority may summon of the bids and seek clarification/information or additional supporting documents or original hard copies against any of the documents only, which are already submitted/uploaded to the web portal and if these are not produced by the intending Bidders within the stipulated time frame, their proposals will be liable for rejection.

Authors:

Kabir Dixit (Counsel)

Akshaya Lal (Associate)

Sharvil Kala (Associate)

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