The Delhi High Court seeks responses from the Defence Ministry after BSS Materiel Limited, an authorized vendor of Indo Russian Rifle Private Limited (IRRPL), challenged the rejection of its Rs 12,000 crore bid to supply Close Quarter Battle Carbines to the Armed forces.
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NEW DELHI: The Delhi High Court has sought responses from the Defence Ministry and other relevant Army departments following a petition by an authorized arms vendor against the rejection of its bid to supply Close Quarter Battle (CQB) Carbines to the Armed forces, a contract valued at Rs 12000 crores.
The petition, filed through the legal firm Lex Panacea by BSS Materiel Limited, an authorized vendor of Indo Russian Rifle Private Limited (IRRPL), challenges the rejection of its bid. IRRPL, a joint venture between India and Russia, manufactures CQB carbines at its facility in Amethi.
A division bench led by Acting Chief Justice Manmohan has requested the Defence Ministry to respond by the next hearing date on August 9. The notice to the Ministry of Defence, the Chief of Defence Staff, the Secretary of the Defence Ministry (DMA), and five other officials, including the Additional Director General (ADG) Acquisition Technical (Army), was issued at the end of April.
The plea details that IRRPL submitted a bid through BSS Materiel Limited to supply 425,213 CQB carbines to the Armed forces. However, the Ministry of Defence rejected the bid. The petition specifically challenges a letter received from the ADG Acquisition on December 11, 2023.
According to the letter, the techno-commercial offer from BSS Materiel Limited was deemed-
“Non-compliant due to failing to meet the financial criteria of Average Annual Turnover and net worth specified in the Request for Proposal (RFP).”
The offer in question was submitted on May 2, 2023, under the authorization of the original equipment manufacturer, Indo Russian Rifle Private Limited, according to the plea.
BSS Materiel Limited argues that the rejection of its bid is unjustified and does not adequately consider the compliance and capability of the vendor in meeting the contractual requirements. The petition urges the court to direct the Ministry of Defence to reconsider its decision and accept the bid for the supply of CQB carbines, emphasizing the strategic and economic significance of the project.
The court’s intervention has brought attention to the procedural and compliance aspects of large-scale defence procurements in India, highlighting the need for transparency and fairness in the evaluation process. The next hearing on August 9 will be crucial in determining the outcome of this high-stakes procurement dispute.
BSS Materiel Limited has filed a petition seeking the annulment of a letter issued by the Additional Director General (ADG) Acquisition and urging that its bid be declared compliant under the Request for Proposal (RFP). The company has also requested permission to participate in the evaluation process on a cost-no-commitment basis and, subsequently, to be allowed to take part in the evaluation as per the trial methodology outlined in the RFP.
The petition highlights significant ambiguities concerning the entity involved, stating-
“There is ambiguity regarding the entity, which constitutes a clear violation of the Doctrine of Equality as enshrined in Article 14 of the Constitution of India.”
This ambiguity, according to the petitioner, undermines the fairness and transparency of the process.
Further complicating matters, the plea points out that the financial criteria by which the entity would be evaluated were not detailed in the RFP.
“The RFP does not discuss the financial criteria by which the entity will be evaluated.”
– the plea stated, emphasizing a lack of clarity that could potentially disadvantage participants.
BSS Materiel Limited also noted that it submitted its bid as a Medium Small Enterprise (MSE), a status acknowledged by the respondent since no Earnest Money Deposit (EMD) was demanded in the response to the RFP.
“The petitioner submitted its bid/response to the RFP as a Medium Small Enterprise (MSE), a recognition the respondent also acknowledges, yet they did not require the Earnest Money Deposit (EMD) typically needed to submit such responses.”
-the plea mentioned.
In addition, the company reported that it had sent letters to the Technical Evaluation Committee (TEC) in July and August 2023, seeking assessment of the Annual Turnover and Net Worth of the Original Equipment Manufacturer (OEM) IRRPL. Despite these efforts, there has been no resolution to the concerns raised by BSS Materiel Limited.
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The petition filed by BSS Materiel Limited underscores significant procedural and transparency issues within the RFP process. The company contends that these issues not only violate the principles of equality guaranteed by the Constitution but also create an uneven playing field for participants. By seeking judicial intervention, BSS Materiel Limited aims to rectify these discrepancies and ensure a fair evaluation process.
