Tender Rejected: Case Studies (L&T, MMRDA)

Here are two well-documented Indian cases where major companies or bidders faced tender rejection or disqualification due to compliance issues. These serve as cautionary case-studies for tender managers.

Case 1: Larsen & Toubro (L&T) – Submarine Tender Rejected

Summary

The Ministry of Defence of India rejected L&T’s bid for a roughly ₹70,000 crore contract for six advanced submarines under the Project 75 India initiative. The Times of India
The reason cited: non-compliance with Indian Navy requirements, specifically related to demonstrating the Air Independent Propulsion (AIP) system and other mandated specifications. The Times of India
The result: L&T was disqualified from the tender process and thus lost a major defence contract opportunity, despite being a top contender.

Key Compliance Lessons

Even large and well-established firms cannot assume compliance requirements are minor. Meeting all technical, regulatory, domestic / Make-in-India or defence-specific conditions is critical.
Lack of demonstrating specified system approvals or operational models (here, the AIP system) can lead to outright rejection, regardless of cost or reputation.
For tender managers: ensure any strategic bid in defence, or high-value government contracts, includes full verification of technical eligibility, proof of system readiness, certified demonstrations (if required), and alignment with sovereign-/domestic-content mandates.

Reference

“Defence ministry disqualifies L&T’s bid, citing non-compliance in Navy’s 70,000 crore submarine project.” Times of India. The Times of India

Case 2: Mumbai Metropolitan Region Development Authority (MMRDA) & L&T – Elevated Road + Tunnel Project

Summary

MMRDA disqualified L&T from bidding on the Thane-Ghodbunder-Bhayander twin tunnel and elevated road projects (estimated at around ₹14,000 crore) due to failure to submit a mandatory affidavit declaring that no bridges built by L&T had collapsed within two years of completion. The Times of India
L&T challenged the decision; the High Court upheld the disqualification process, citing “material suppression” by L&T. Later, the Supreme Court asked MMRDA to revisit the tender process in the interest of transparency. The Times of India
The case illustrates how non-submission of a seemingly routine affidavit led to disqualification, even for a top infrastructure company.

Key Compliance Lessons

Tender documents often include clauses that seem procedural (e.g., affidavits, declarations, past performance criteria). Failure to submit them can lead to rejection.
Even if you are cost-competitive (L&T’s bid was reportedly significantly lower than the awarded bidder’s), procedural non-compliance can override cost advantages.
For tender managers: meet all declaratory and certification requirements. Maintain a checklist for every ancillary document (affidavits, performance history, safety records, litigation history). Don’t assume these are “minor” or can be clarified later.