Tendering Authority Best Placed to Prescribe Technical Eligibility Criteria: Delhi High Court

The Hon’ble Delhi High Court, in Skylark Infra Engineering Pvt. Ltd. v. Municipal Corporation of Delhi (W.P.(C). 8368 of 2026), decided on July 20, 2026, held that courts will not interfere with technical eligibility criteria prescribed in public tenders unless they are shown to be arbitrary, mala fide, irrational or contrary to public interest. The Hon’ble Court observed that a tendering authority is best placed to assess the technical requirements of a project, and courts cannot rewrite eligibility conditions merely to widen competition.

The dispute arose from a Notice Inviting Tender (“NIT”) issued by the Municipal Corporation of Delhi (“MCD”) for engagement of a contractor to collect toll tax and Environment Compensation Charge at Delhi’s border points and upgrade the existing Radio Frequency Identification (“RFID”) system to a Multi Lane Free Flow (“MLFF”) based collection system. The petitioner challenged the requirement that bidders possess prior experience of operating a minimum of 122 toll lanes under a single contract for a specified period, contending that the condition was arbitrary, anti-competitive, and designed to exclude otherwise competent bidders. The petitioner pointed out that MCD had itself acknowledged the very same condition to be anti-competitive in earlier proceedings and had expressly omitted it by a corporate resolution passed in 2025, before reintroducing it in the impugned NIT.

The petitioner contended that experience gained through multiple contracts or as part of a joint venture adequately demonstrated its technical capability and that the impugned condition bore no rational nexus with the implementation of the MLFF system. MCD, on the other hand, submitted that the project involved deployment of an integrated technology-driven ecosystem across 244 toll lanes, requiring prior experience in managing a project of comparable scale under a single contract, and that the eligibility criterion represented a policy decision beyond the scope of judicial review.

The Hon’ble High Court reiterated the settled principles governing judicial review of tender matters as laid down in Tata Cellular v. Union of India, Michigan Rubber (India) Ltd. v. State of Karnataka, Jagdish Mandal v. State of Orissa, and Reliance Energy Ltd. v. Maharashtra State Road Development Corporation Ltd. It observed that while courts must ensure that tender conditions comply with Article 14 of the Constitution, they cannot substitute their own assessment for that of the procuring authority unless the decision is vitiated by arbitrariness or mala fides.

Applying these principles, the Hon’ble Court held that the impugned eligibility criterion had a rational nexus with the object of the tender. It accepted MCD’s justification that implementation of the MLFF system involved an integrated technology platform requiring experience beyond conventional toll collection and that operating multiple independent contracts could not necessarily be equated with managing a single integrated project. The Hon’ble Court further observed that the criterion was neither tailor-made nor anti-competitive, as multiple bidders satisfied the prescribed requirement, and that the petitioner’s previous experience as a joint venture partner did not entitle it to relaxation of uniformly applicable eligibility conditions. The Hon’ble Court further observed that the petitioner’s ineligibility stemmed not from the impugned criterion but from the discontinuation of its joint venture, the lead partner of which had elected to bid independently under the impugned NIT. It also rejected the reliance placed on MCD’s earlier corporate resolution and the stand taken by it in the earlier proceedings, holding that the earlier tender related to an RFID-based system whereas the impugned NIT envisaged implementation of the MLFF system, and that MCD was therefore justified in revisiting its policy and prescribing revised eligibility criteria. It also noted that the tender had been issued pursuant to the recommendations of the Commission for Air Quality Management and directions of the Supreme Court requiring implementation of the MLFF system within a stipulated timeline, thereby justifying the higher technical threshold.

Accordingly, the Hon’ble High Court dismissed the writ petition, holding that the impugned eligibility criterion was neither arbitrary nor violative of Articles 14 or 19(1)(g) of the Constitution, and declined to interfere with the tender conditions framed by MCD.