AAI directed to call for fresh tender pertaining to setting up of outlets

Holding that a bidding process stands vitiated if a bidder has a relationship with another bidder directly or through common third party, the Madras High Court has directed the Airports Authority of India (AAI) (Southern Region) to call for fresh tender for appointment of ‘Master Concessionaire’ to design, build, finance, operate and maintain general retail outlets at Chennai Airport.
AAI directed to call for fresh tender pertaining to setting up of outlets
Madras High Court


Justice M Duraiswamy, who set aside the bid, said, “The relationship between two bidders need not necessarily be a corporate relationship. But a close relationship of two bidders that puts either or both to have access of each other information or to influence the proposal of either or each other, shall be deemed to have conflict of interest.” 
As per the case, the AAI (Southern Region) represented by its Regional Executive Director, Chennai, floated a tender for appointment of Master Concessionaire at Chennai Airport in October 2016. After the technical opening of the bid, Evolve Business Ventures of Bangalore was disclosed as the highest bidder. 
Immediately after this, Travel News Services (India) Private Limited, the petitioner in the case, on finding that Bhawar Lifestyle another bidder and Evolve Business Ventures belonged to the same family, were under the same management team and have common control, which per se was violative of the tender conditions, approached AAI to disqualify their bids. However, AAI opened the Financial bids on December 22, 2016, and declared Evolve Business Ventures as the highest bidder. This led to Travel News Services moving the High Court challenging the same. 
Justice Duraiswamy ruling in favour of Travel News Services also held that, “In the case on hand, Bhawar Lifestyle and Evolve Business Ventures, being close relatives, were carrying on business in the same premises. They have engaged a common consultant, who had mistakenly mentioned the Account ID of Evolve Business Ventures in the Bhawar Lifestyle’s EMD Challan, which would establish that the above two were able to have access to each other information in the bidding process.” 
Also, the judge on noting that this court has no other option, except to intervene in the tender process, said, “The Tendering Authority has the public duty to be fair to all concerned. The Tendering Authority is bound to adhere to the criteria, standards and procedures laid down by them and cannot depart from them arbitrarily.” 

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