Court Directs Authorities to Consider Technical Bid Without Insisting on Labour Registration Licence at Pre-Allotment Stage
Srinagar, October 3: The High Court of Jammu & Kashmir and Ladakh has held that a labour registration licence cannot be insisted upon as a mandatory pre-condition for participation in a tender unless such a requirement is specifically, clearly and unambiguously incorporated in the tender documents.
The Court accordingly directed the concerned authorities to consider the technical bid of a petitioner-firm without insisting upon submission of the labour registration licence at the pre-allotment stage, subject to fulfilment of all other applicable tender conditions.
The ruling was passed by Justice Mohd Yousuf Wani while hearing a petition filed by M/s Incredible Placement Services Pvt. Ltd. against its disqualification from a tender floated by Air Force Station, Srinagar, for providing cleaning, sanitation, disinfection, security, manpower and allied services.
Firm Disqualified Over Labour Licence
The petitioner-firm had participated in an online tender issued by the Air Force Station, Srinagar, in January 2026. According to the petition, the firm had complied with the tender requirements but was disqualified for not submitting a labour registration licence/certificate relating to the engagement of 100 workers in a day.
The firm challenged the disqualification before the High Court, arguing that the tender documents did not specifically prescribe such a licence as a mandatory pre-condition for submission of the bid.
The petitioner also relied upon a J&K Labour Commissioner’s circular dated November 20, 2020, which directed principal employers not to insist upon a contract labour licence as a pre-requisite for participation in tendering. The circular contemplated obtaining the licence after allotment of the contract and before release of payment.
Court Finds No Clear Pre-Bid Requirement
After examining the tender documents, the High Court observed that the petitioner appeared to have been disqualified specifically on account of non-submission of the labour registration licence.
However, the Court found that there was no specific stipulation in the tender conditions or documents making possession or submission of the labour licence a pre-requisite for submitting the bid.
The Court held that such a requirement could not subsequently be imposed as a condition for participation when it had not been clearly incorporated into the tender documents.
Licence Can Be Required After Contract Award
The Court clarified that while the licensing requirement may still have to be fulfilled by the successful contractor, it cannot automatically be treated as an eligibility condition at the bidding stage unless the tender expressly says so.
The Court observed that the requirement could be insisted upon by the principal employer or executing agency after allotment of the contract and before release of payment.
Tender Conditions Must Be Clear and Unambiguous
The Bench also considered the judgment in M/s Trident Softech Pvt. Ltd. v. State of Orissa and Others, relied upon by the petitioner.
The High Court observed that the facts of the earlier case were similar to those before it and agreed with the principle that the conditions governing participation in a tender must be clearly and specifically stated in the tender documents.
The Court stressed that bidders should not be exposed to disqualification for failing to submit a document which has not been expressly prescribed as a mandatory requirement in the tender notice or accompanying documents.
No Unconditional Award of Contract
The High Court, however, did not direct that the petitioner’s bid be automatically accepted or that the contract be awarded to the firm.
Instead, it directed the authorities to consider the petitioner’s technical bid without insisting upon the labour registration licence at the pre-allotment stage, while making it clear that the petitioner would still have to satisfy all other applicable conditions of the tender.
The Court also took note of the 2020 circular issued by the J&K Labour Commissioner and observed that it further clarified the distinction between requirements for participation in tendering and compliance with statutory licensing requirements after allotment of work.
Case Details
Case: M/s Incredible Placement Services Pvt. Ltd. v. Union of India and Others
Citation: 2026 LiveLaw (JKL) 326
Bench: Justice Mohd Yousuf Wani
Petitioner’s Counsel: Naveed Gul, Advocate
Respondents’ Counsel: Faizan Ganai, CGSC
The judgment reinforces the principle that tender authorities must adhere to the conditions expressly notified to bidders and cannot introduce an unstated eligibility requirement at the stage of scrutiny of bids.(KNC)
