Clarification Is Not Correction: Supreme Court bars post‑opening price rectification and mandates impleadment of affected H1 bidders in tender litigation

Introduction

Decision: Prakash Asphaltings and Toll Highways (India) Limited v. Mandeepa Enterprises and Others, 2025 INSC 1108, Supreme Court of India (Civil Appeal No. 11418 of 2025), decided on 12 September 2025, per Ujjal Bhuyan, J. (with Manoj Misra, J.).

This decision resolves a recurrent controversy in public procurement: can an authority invoke a “clarification” clause to correct a bidder’s financial offer after opening of price bids, especially where the BOQ template clearly prescribes how the price must be quoted? The Court answers in the negative, re‑emphasizing that:

• a clarification power (here, Clause 5B(v) in Instructions to Bidders) is confined to seeking information about documents already submitted; it does not permit changing or “reconstructing” the financial offer;
• the BOQ template and its non‑variation mandate (Clause 4(g)) are sacrosanct;
• public interest is not synonymous with short‑term revenue maximization; and
• when relief sought impacts the position of the highest bidder (H1), that bidder is a necessary party; failure to implead violates natural justice.

The case arose from a tender for Road User Fee (RUF) collection for a 1095‑day period on the Dankuni–Chandannagar–Mogra stretch (SH‑13) in West Bengal. After financial bids opened, the writ petitioner (Mandeepa) – the lowest (H4) at Rs. 9,72,999 – asked the authority to treat its quote as a per‑day rate and multiply it over 1095 days to Rs. 106.54 crore, thereby leapfrogging the declared H1 (Prakash Asphaltings at Rs. 91.19 crore). The Single Judge declined interference; the Division Bench allowed rectification, but offered other qualified bidders an opportunity to match the corrected price. The Supreme Court set aside the Division Bench.

Summary of the Judgment

The Supreme Court allowed the appeal and restored the Single Judge’s dismissal of the writ petition. Key holdings include:

• Clause 5B(v) (clarification) empowers the authority to seek clarifications on documents already submitted but cannot be stretched to permit post‑opening alterations in the financial offer. It must be read with Clause 4(g), which expressly prohibits any change in the BOQ template.
• Mandeepa’s entry of Rs. 9,72,999 “for 1095 days” in both figures and words was not a mere inadvertent per‑day error; permitting rectification after price opening would unsettle the tender’s sanctity.
• Public interest is broader than obtaining higher revenue; adherence to tender terms and maintaining certainty in procurement are equally (often more) important.
• Given that Prakash Asphaltings had been declared H1, it was a necessary party in the High Court; disposing of the appeal without its impleadment and hearing violated natural justice.
• The Division Bench’s directions to re‑compute and then invite others to match the corrected price were impermissible judicial interference in the tender process.

Result: The Division Bench’s order was quashed; State authorities were permitted to proceed with finalization under the original NIT dated 17.10.2023. No order as to costs.

Factual Matrix and Tender Timeline

• NIT (No. 7 of 2023‑24, dated 17.10.2023): engagement of a complete RUF operator with NETC integration for the Dankuni–Chandannagar–Mogra (SH‑13) plaza; contract period 1095 days; annual potential collection Rs. 21.60 crore; EMD Rs. 25 lakh.
• Two‑bid system: technical and financial, concurrent e‑submission. BOQ to be quoted in figures and words; where discrepancy exists, words prevail. Highest remittance over contract period would be H1.
• Critical clauses:
  • Clause 4(g): “Any change in template of BOQ will not be accepted under any circumstances.”
  • Clause 5B(v) (Instructions to Bidders): the authority may seek clarification or additional documents regarding those already submitted.
• Evaluation: Of seven bidders, four were technically qualified – including Prakash Asphaltings and Mandeepa. Financial bids were opened electronically; Prakash was H1 at Rs. 91.19 crore (for 1095 days), Mandeepa H4 at Rs. 9,72,999.
• Post‑opening request: Mandeepa emailed on 13.12.2023, affirming by affidavit that Rs. 9,72,999 was a per‑day figure and should be multiplied for 1095 days (Rs. 106.54 crore). The authority rejected the request on 20.12.2023 to preserve the tender’s sanctity.
• Litigation history:
  • Single Judge (03.01.2024): dismissed writ; accepting post‑opening correction would render the process opaque and arbitrary.
  • Division Bench (23.02.2024): allowed appeal, interpreted Clause 5B(v) to permit correction throughout evaluation, directed re‑evaluation as 1095‑day amount and allowed other qualified bidders to match.
  • Supreme Court: granted leave, stayed DB order, and finally set it aside.

Detailed Analysis

A. Precedents Cited and Their Influence

• West Bengal State Electricity Board v. Patel Engineering Co. Ltd., (2001) 2 SCC 451:
  • Rejects post‑opening corrections of bid errors that bidders could have avoided with due diligence. “Clarifications” cannot sanitize negligence after bids are opened.
  • Influence here: SC treats Mandeepa’s error as avoidable; allowing correction a month after opening in Patel was impermissible – the same logic applies.
• Jagdish Mandal v. State of Orissa, (2007) 14 SCC 517:
  • Defines narrow threshold for judicial review in tenders: courts intervene only for mala fides, perversity, arbitrariness, or public interest detriment.
  • Influence: The DB’s intervention to remodel the price bid failed the Jagdish Mandal test; SC restored restraint.
• Afcons Infrastructure Ltd. v. Nagpur Metro Rail Corporation Ltd., (2016) 16 SCC 818:
  • Courts must defer to the procurer’s interpretation absent mala fides/perversity; words in tender documents must be given effect. Also, eligible bidders should be impleaded in writs challenging tenders (para 18).
  • Influence: (i) Clause 4(g)/5B(v) given their plain meaning; (ii) failure to implead H1 vitiated the DB’s order.
• Johra v. State Of Haryana, (2019) 2 SCC 324:
  • Reaffirms no adverse order without hearing affected party.
  • Influence: Non‑impleadment and non‑hearing of H1 (Prakash Asphaltings) violated natural justice.
• M/s ABCI Infrastructures Pvt. Ltd. v. Union of India, 2025 INSC 215:
  • Error of “Rs. 1,569.00” instead of “Rs. 1,569 crore” claimed as system glitch; SC held bidder at fault. While BRO proceeded differently, SC imposed consequences but did not validate post‑opening price reconstruction.
  • Influence: Reinforces bidder diligence; system error claims do not justify altering an opened price bid.
• CIDCO v. Shishir Realty Pvt. Ltd., (2012) 16 SCC 527:
  • Public interest is not merely “more money”; fairness and contract sanctity also matter.
  • Influence: Counters DB’s revenue‑maximization rationale.
• Subodh Kumar Singh Rathore v. CEO, 2024 SCC OnLine SC 1682:
  • Sanctity of public tenders is foundational; public interest considerations are broader than financial upside.
  • Influence: Underscores why re‑engineering a completed price opening to chase a higher figure is impermissible.

B. The Court’s Legal Reasoning

1. The BOQ template is inviolable; “clarification” cannot mutate price

The BOQ template itself stated the amount must be for “1095 days,” with the price to be entered in figures and words. Clause 4(g) prohibited any change “under any circumstances.” Mandeepa’s entry was Rs. 9,72,999 “for 1095 days,” in figures and in words. The Supreme Court held that such entry belies the “inadvertent per‑day” claim.

Clause 5B(v) allows the authority to “seek clarification/information or additional supporting documents” regarding documents already submitted. The Court strictly cabined this to the documentary sphere; it does not authorize conversion of a disclosed financial offer into a new one after price opening. Clause 5B(v) must be read with Clause 4(g); together, they foreclose price reconstruction.

2. Procurement sanctity over ex post revenue optimization

While Mandeepa’s “corrected” 1095‑day figure (Rs. 106.54 crore) would exceed H1 (Rs. 91.19 crore) by ~Rs. 15 crore, the Court held that public interest is not exhausted by such arithmetic. Sanctity, transparency, predictability, and level playing field are integral public interests. Revenue gains cannot justify unsettling concluded price opening or bending tender terms.

3. Judicial restraint in tender matters

Invoking Jagdish Mandal and Afcons, the Court emphasized:

• Evaluation of bids is a commercial function;
• Court interference requires mala fides, perversity, or palpable illegality; and
• Disagreement with the procurer’s interpretation is insufficient.

The DB’s approach—directing the authority to treat the quote as a per‑day rate, compute a new 1095‑day price, and then offer others a chance to match—was an overreach into procurement administration and inconsistent with the tender’s terms.

4. Necessary party and natural justice

The relief granted by the High Court prejudicially altered the position of the declared H1. Following Afcons (para 18) and Johra, the Supreme Court held that Prakash Asphaltings was a necessary party. Judicial proceedings, unlike administrative tender evaluations (where principles of natural justice are flexible), must adhere to audi alteram partem when passing adverse orders. The DB’s failure to implead and hear H1 vitiated its decision.

C. Impact and Prospective Significance

1. For procuring entities

• Clarification clauses cannot be used to regularize post‑opening price errors; their ambit is limited to clarifying/documenting what is already submitted.
• Where tender terms contain non‑variation mandates for BOQ, authorities must enforce them strictly; “play in the joints” does not extend to price recasting.
• Revenue‑maximization arguments do not trump tender sanctity; authorities should avoid ad hoc invitations to “match” a judicially re‑engineered price.
• In litigation, insist on impleadment of all materially affected bidders, especially the declared H1/H2.

2. For bidders

• Exercise meticulous care when populating the BOQ. Courts will treat obvious mismatches (like crore vs rupees) as bidder negligence unless tender terms expressly allow arithmetic corrections.
• Do not rely on post‑opening “clarification” to fix a mis‑quoted price; such attempts risk rejection and litigation costs.
• If challenging tender outcomes, implead all affected bidders or risk dismissal on natural justice grounds.

3. For constitutional courts

• Maintain high thresholds for interference; respect the procurer’s interpretation of tender terms absent mala fides/perversity.
• Ensure necessary parties are before the court to avoid orders in violation of audi alteram partem.
• Avoid remedial measures that restructure a tender (e.g., re‑computing bids, introducing match‑the‑price directions) unless authorized by the tender and warranted by the narrow grounds of review.

Complex Concepts Simplified

• BOQ (Bill of Quantities): The price schedule in which bidders must enter their financial offer in a prescribed template. If the template says “for 1095 days,” you must input the total amount for that period—not per‑day rates—unless the template expressly asks per‑day figures.
• H1/H2/H3/H4: Ranking of bidders in descending order of the bid value (here, because the tender sought the highest remittance). H1 is the highest (best) bid in such revenue tenders.
• Clarification vs Correction:
  • Clarification: providing information or documents explaining what you already submitted (e.g., legible copies, proof of eligibility, explanation of a certificate).
  • Correction: changing the substance of what you submitted (e.g., altering a price). Unless the tender explicitly allows arithmetic or typographical corrections pre‑defined by the ITB, post‑opening price corrections are barred.
• Sanctity of tender: The expectation that the rules of the tender will be consistently applied so all bidders compete on a level playing field. It ensures transparency, fairness, and predictability.
• Public interest in procurement: Not just higher immediate revenue, but also the integrity, certainty, and timely delivery of public projects. Courts balance these facets rather than chase arithmetic gains at the expense of process.
• Necessary party: A person or entity whose legal rights will be directly affected by the outcome. In tender litigation, a declared H1 is a necessary party if the relief sought may displace or prejudice its status.

Key Passages and Doctrinal Moves

• Clause 5B(v) was confined to clarifying documents already submitted; it cannot be broadened to permit financial bid modification, particularly when read with Clause 4(g)’s non‑variation mandate.
• The Court treated Mandeepa’s error as non‑inadvertent because the BOQ line item expressly stated “for 1095 days,” and the price in figures and words matched that unit; this careful factual reading is important for future “obvious error” claims.
• Public interest is not reducible to “more money”; judicial dicta in CIDCO and Subodh Rathore are elevated here to a controlling consideration against ad hoc, post‑opening remodelling of bids.
• Afcons’s guidance on impleadment is reinforced: all eligible or affected bidders should be made parties to avoid partial adjudication or orders in breach of natural justice.

Practical Checklists

For Procurers

• Draft clear BOQ instructions; state explicitly what unit (per‑day/total period) the rate must represent.
• Include limited arithmetic error correction mechanisms if intended (e.g., words prevail over figures; summation errors corrected without changing unit rates) and specify the exact scope.
• Train evaluation committees on the limits of “clarification.”
• In litigation, ensure impleadment of all bidders whose ranking could be impacted by the outcome.

For Bidders

• Map each BOQ column carefully; match the “unit” in the template (e.g., 1095 days) before inputting figures and words.
• Double‑verify final entries before submission; use internal peer review checklists.
• If you discover an error pre‑opening, promptly use any amendment window allowed by the portal/tender; post‑opening, assume correction is impermissible unless expressly provided.

Counterpoints and Limits

The ruling does not suggest that all forms of correction are forever barred. Many tenders:

• permit arithmetic error correction where unit rates and totals mismatch; and/or
• expressly define what constitutes a “minor deviation” or “non‑material irregularity.”

However, in this NIT, the specific clauses and the BOQ design left no room for changing the quoted price unit (per‑day to total period) after bids were opened. The Court’s holding is therefore anchored in the contractual text and the facts (entry for “1095 days” in words and figures).

Conclusion

Prakash Asphaltings v. Mandeepa Enterprises reinforces foundational principles of Indian tender jurisprudence:

• sanctity of the BOQ template and strict fidelity to tender terms;
• narrow scope of “clarification” clauses that do not authorize price modification post‑opening;
• judicial restraint and deference to the procurer’s interpretation in the absence of mala fides or perversity;
• a holistic view of public interest, rejecting revenue‑only justifications for unsettling tenders; and
• the necessity to implead and hear affected H1 bidders in writ proceedings.

The precedent provides clear guidance to procurers, bidders, and courts alike: accuracy at the time of bid submission is the bidder’s burden; post‑opening “corrections” that go to price are anathema unless the tender itself provides a narrow and explicit mechanism. Public procurement’s legitimacy depends not only on the quantum of revenue but also on fair rules, predictability, and timely execution—values that this judgment robustly protects.