“Favouritism”: J&K High Court Quashes Tenders Awarded To Johnson & Johnson, SR Technomed Over Bias And Arbitrariness

The Jammu & Kashmir High Court has set aside rate contracts awarded by the Jammu and Kashmir Medical Supplies Corporation Ltd. (JKMSCL) for supply of suture materials stating “clear arbitrariness, procedural violations, and institutional favouritism” in favour of two long-time vendors.

A bench of Justice Moksha Khajuria Kazmi observed that financial bids were opened and contracts awarded without proper sample evaluation, in stark violation of the tender terms.

It added that the rules provide for the technical evaluation of bidders but the same was a sham, carried out without inviting or testing products of competing bidders, including the petitioner.

The court said that the petitioner's sealed financial bid, submitted to the court, showed significantly lower rates than those of the selected vendors.

It said that despite a two-bid system (technical and financial), samples were not collected or evaluated from technically disqualified bidders which is in clear violation of the bid document.

The Court found that respondents/JKMSCL officials had not constituted the technical evaluation committee as per rules, and instead relied on past performance of respondent No. 5 (a regular supplier for over 30 years) and respondent No. 6 (who had lost tender litigation in 2010 but was still awarded contracts repeatedly without fresh evaluation).

The Court held that the process of sample submission and evaluation was a mere eyewash, noting that the purpose of calling for the samples was a mere eye wash and a sham intended to conceal the arbitrariness and favouritism shown by respondents No. 2 to 4.”

It was further noted that no independent expert evaluation was conducted, and no complaints were ever received against the petitioner's suture supplies, despite its usage across several states.

The court further pointed out that minutes of meeting responding to bidder objections were never communicated to the petitioner while the Standard Procurement Procedure (SPP), mandated publication of objections and responses on the official website which stand violated.

It said that sample collection was selective and delayed, and no evaluation by end-user medical experts has taken place even five months after sample receipt.

Meanwhile, JKMSCL admitted that suture stock across its drug warehouses is nearly nil, and no supply orders were placed due to the pending petition, despite having issued Letters of Intent in November 2024.

The court directed quashment of minutes of meeting and all decisions thereafter including rejection of bids, opening of financial bids, and rate contracts in favour of respondents 5 & 6 and issuing of fresh tendering process to be initiated immediatel.

It further directed that sample evaluation must be conducted by end-user experts and submitted to the competent authorities for fair assessment

It directed that until the new tender is finalized, respondents 2 to 4 may procure suture material through transparent interim arrangements to meet current shortages

BACKGROUND:

The petitioner, a reputed independent medical device manufacturer in India, specializes in high-quality surgical consumables and has executed successful contracts across various Indian states

In October 2023, the Jammu and Kashmir Medical Supplies Corporation Ltd. (JKMSCL) floated an e-tender for procurement of suture materials, categorized into Groups A through D. The tender outlined strict eligibility criteria, including turnover and licensing requirements.

A Technical Evaluation Committee reviewed the bids. While the petitioner met all eligibility and technical criteria, only Johnson & Johnson and SR Technomed were selected for financial bid opening for several categories.

Notably, Johnson & Johnson was approved for Group A-II and SR Technomed for Group C, despite not submitting bids for these categories. For Group A-III, only Johnson & Johnson was approved out of ten bidders without assigning any reasons.

The petitioner alleges that this selective and arbitrary conduct by respondents No. 2 to 4 violated the tender conditions and demonstrates bias, especially since the petitioner had a proven track record and met all qualifications but was excluded from financial bid consideration without justification.

APPEARANCE:

Rahul Pant Sr. Advocate with Mr. Varut Kumar Gupta, Advocate Ms Savita Sarna, Advocate Ms Anisha Mathur Advocate Mr. Umar Javed, Advocate Mr. Rajeev Chargotra Advocate Mr. Mubasher Manhas Advocate.Mr. Druv Pant. For Petitioners

Raman Sharma AAG Mr. Pranav Kohli Sr. Advocate with Mr. Ashwin Sapra Advocate Ms Avantika Sharma Advocate Mr. Amjid Maqbool Advocate Mr. C.M.Koul Sr. Advocate with Mr. Farhan Mirza Advocate. Mr. Pratyaksh Deoria Advocate Mr. A.R.Bhat Advocate. For Respondents

Case-Title: Healthium Medtech Ltd. Vs UT of Jammu and Kashmir and others

Citation: 2025 LiveLaw (JKL) 241

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