Law on Article 12 of Constitution of India | World Bank a Government Agency or not? Del HC decides

Delhi High Court: Deciding the issue of whether World Bank is a government agency or not, the Division Bench of Vipin Sanghi and Jasmeet Singh, JJ., answering in negative, disposed of the petition.
Background
NDMC had rejected the petitioner’s bid while disqualifying it from participating in any re-tendering process as the petitioner stood debarred by the World Bank and this fact had not been disclosed by the petitioner in the undertaking submitted in terms of clause 20(r) of the tender conditions. This clause obligated the petitioner to submit an undertaking that it was not blacklisted/debarred by any Government agency.
In the present matter, the question for consideration was:
Whether World Bank could be considered as a “Government Agency” in terms of clause 20 (r) of the tender conditions?
Counsel for NDMC submitted that the World Bank has representatives of India on its body, which included the Union Finance Minister and Government of India has voting rights in the World Bank, and therefore it could be included as government agency.
Per contra, Senior Counsel for the petitioners submitted that for the World Bank was to be categorized as the “Government Agency”, it will have to be established that it acts as an agent of the Government of India. The petitioners placed on record the decisions wherein it was held that the World Bank was not a Government Authority under Article 12 of the Constitution of India and no writ would lie against the World Bank.
Analysis, Law and Decision
High Court opined that,
World Bank or any of the other international bodies, which have proceeded to debar the petitioner, cannot be considered as a “Government Agency”. This is for the reason that none of the international bodies are bound by any directions issued by the Government of India.
GOI’s Role
The Government of India does not exercise control, actual or pervasive, over their affairs and that is why they have been held as not amenable to the writ jurisdiction of the High Court, as they are not considered State or other authority within the meaning of the said expressions under Articles 12 and 226 of the Constitution of India.
Court observed that the Clauses 20(r) read with 55 in the tender were penal in nature as they purported to debar the bidder who does not make a disclosure about its debarment by a Government Agency. Therefore, they had to be strictly construed.
Final Word
World Bank cannot be construed as a government agency when, generally understood, it is not a government agency.
“Government agency”– in the present context, certainly cannot be construed as encompassing within its scope, bodies like the World Bank.
Conclusion
Bench held that petitioner cannot be barred from participating in the re-tendering process, unless the respondent amends the terms and conditions of the tender so as to specifically bar all such bidders who have been barred by international bodies, like the World Bank. [A2Z Infraservices Ltd. v. North Delhi Municipal Corporation, WP (C) 11480 of 2021, decided on 12-10-2021]

Advocates before the Court:
For the Petitioners:

Mr Rajiv Nayar, Senior Advocate alongwith Mr Sudhir Sharma, Mr MohitBakshi, Mr Saurabh Seth, Mr Naman Singh Bagga and Mr Adit Vikarmadaditya Garg, Advocates.

For the Respondent:

Ms Mini Pushkarna, Standing Counsel alongwith Ms Khushboo Nahar, Ms LatikaMalhotra, Advocates with Mr Rakesh Kumar Jha, Project Manager (Electrical), Nr.DMC.

Join the discussion

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.