ISHAR GASOIL PVT. LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) NOTICE Inviting Offers (NIO) for exploration of oil and natural gas pertaining to 34 exploration blocks required the bidder to have the requisite Financial Capability as per Condition No.VIII of the tender documents. Since the issue with which we are concerned relates to the ,,NET WORTH CALCULATION in the context of ,,FINANCIAL CAPABILITY, we note said Condition No.VIII. It reads as under:-

(2.) A reading of clause (i) of Condition No.VIII would reveal that the bidder should have a net worth, duly certified as per a certificate issued by the statutory auditor. The NET WORTH CALCULATION has to be as per the method prescribed i.e. (a) Paid Up Capital + (b) Reserve and Surplus ­ (c) Miscellaneous Expenditure to the extent not written off ­ (e) Contingent Liability on Revenue Account.

(3.) ALL bids received were processed and were required to be considered by the Empowered Committee of Secretaries which met on September 02, 2011. The note put up by the Director General of Hydrocarbons (DGH) recommended rejection of petitioners bid on the opinion formed by the DGH that the petitioner did not have the requisite Net Worth since 'Letter of Credit' and 'Bank Guarantees' issued at the instance of the petitioner were required to be deducted being 'Contingent Liability on Revenue Account'.