The money had already reached the authority’s account, so what was left to produce? A tender bid cannot be rejected for want of a physical original of an e-payment receipt for bid security, the Supreme Court has held, calling such insistence perverse.
New Delhi: A tender bid cannot be rejected merely because the original of an e-paid bid security was not submitted, the Supreme Court has ruled, allowing the appeal of a company whose bid for a Railways engineering, procurement and construction (EPC) contract was discarded on that ground even though it had paid through the authority’s e-payment gateway. The Court set aside the Patna High Court Division Bench order that had upheld the rejection and directed that the company’s financial bid be opened and considered along with the other bids [Hardev Construction Private Limited v. Union of India and Others].
The appeal arising out of SLP (C) No. 25855 of 2026 was allowed on October 12, 2026 by Justice J.B. Pardiwala and Justice K. Vinod Chandran, with the judgment written by Justice Chandran.
A bid thrown out at the threshold
The Railways floated the tender in January 2026 for guide bunds, launching aprons and river protection works on the Bikramshila-Katareah New Line rail link project. Clause 2.20.6 of the Request for Proposal permitted bid security as a bank guarantee, demand draft, fixed deposit receipt, banker’s cheque or payment through the authority’s e-payment gateway. The appellant used the gateway and uploaded a scanned copy of the digital receipt with its bid.
The bid was rejected under Clause 2.20.6(ii) because the original of the bid security had not been physically submitted. The Patna High Court Division Bench upheld that, and the appellant’s financial bid was never opened. Before the Supreme Court the appellant argued that the money was already in the authority’s account and no physical instrument remained to be delivered. The Railways stood on the express wording of the tender condition, while the successful bidder invoked Prakash Asphaltings and Toll Highways (India) Ltd. v. Mandeepa Enterprises to urge deference to the tendering authority’s reading of its own documents.
Why no original was called for
The Court accepted the appellant’s case. A bank guarantee or a similar instrument gives the authority no lien unless it is physically delivered, which is the reason an original is demanded for those forms. An e-payment works differently: the money has already moved into the respondents’ account and is fully under their control, leaving nothing further to produce. Finding the rejection clearly perverse, the Court held:
Rigid adherence to the letter of a document cannot be countenanced
The Court set Prakash Asphaltings apart, since that decision itself accepts that deference to the tendering authority stops short of a mala fide or perverse application of tender conditions. To insist on a physical original of the receipt of an online payment, the Court said, was to demand compliance with something impossible.
What the Court directed
The impugned order stands set aside. As the appellant’s earlier deposit was refunded after the rejection, the authorities are to facilitate an e-payment of the bid security within two weeks; if a technical difficulty arises, the appellant may furnish the amount in another permitted form within a further two weeks. The operative part also directs the contract to be awarded to the appellant, and then records that, once the security is in place, the appellant’s financial bid is to be opened and considered along with the other bids and the tender finalised in accordance with the other tender conditions.
The judgment does not reconcile the two directions in terms, and readers should consult the full text for how they operate together.
What the ruling does and does not change
Courts still defer, as a rule, to the tendering authority’s reading of its own conditions, and the judgment leaves that rule intact. Its point is narrower: a condition written for physical instruments cannot be applied, regardless of its purpose, to a payment completed electronically, and a bidder cannot be disqualified for not producing something that does not exist.
For bidders and procuring agencies alike, the ruling suggests that proof of a completed e-payment, uploaded as the tender asks, is sufficient compliance, and that a rejection on so hyper-technical a ground can be reviewed by courts as perverse.
Case Title: Hardev Construction Private Limited v. Union of India and Others [Arising out of SLP (C) No. 25855 of 2026]
Bench: Justice J.B. Pardiwala and Justice K. Vinod Chandran, Supreme Court of India
Date of Judgment: October 12, 2026
Appearances: A.K. De for the appellant; Additional Solicitor General Kanakamedala Ravindra Kumar for the Ministry of Railways; Nina R. Nariman for the successful tenderer