JUDGMENT

R. B. MISRA, J. :—The present appeal by special leave is directed against the judgment and order dated January 10, 1986 of the High Court of Judicature at Bombay dismissing the petition under Article 226 of the Constitution filed by the appellant.

2. The appellant is carrying on the business of bulk supply of milk, milk products and milk cream, etc. The appellant is well known in the said field and has a plant of pasteurization in Pune and has been carrying on the said business for more than twenty years. The appellant installed a plant for pasteurization at a heavy cost to the tune of rupees three lakhs. The appellant has been supplying large quantities of milk and milk products pasteurized or otherwise to various companies, Government Departments including respondents Nos. 2 and 3. The appellant as a registered contractor has been supplying fresh buffaloes and cows milk to respondents Nos. 2 and 3 as per the requirements for the last twenty years. The appellant is on their approved list for some period and his supplies and work were always appreciated and accepted by the respondents for all these periods.

3. The appellant is also capable of supplying any quantity of pasteurized milk and, indeed, he had been supplying to various organisations the milk and milk products and also pasteurized milk. Later on Respondent No. 2, the officer-in-charge of the Military Farms, Pimpri, directed that the local purchase of milk be stopped and regular supply under a contract by inviting tenders be effected. Accordingly, the appellants contract for supply of fresh buffalo and cow milk ended in 1984.

4. The Military Farm has its own plant for pasteurization and for all these years respondents Nos. 2 and 3 had been making purchases of only fresh buffalo milk and used to pasteurize the milk for their own purposes in their own plant. The plant of respondents 2 and 3 is very much in operation till to-day and also on the date of inviting tenders in question.

5. Respondent No. 2 issued on or about July 16, 1985 tender notices for the supply of fresh buffalo or cow milk. The said tender notice was published in the Indian Express on July 29, 1985. The tender notice was also sent to the appellant by Respondent No. 2 by registered post acknowledgment due which was received by the appellant in July 1985. By the said tender notice, the respondent had invited tenders for supply of fresh buffalo or cow milk at Military Farms of Pimpri, Pune. The appellant being eligible and already on the approved list of the respondents submitted a tender for supply of fresh buffalo milk to respondents 2 and 3 as per the requirements stated in the tender notice. The appellant had offered the milk at the rate of Rs. 4.21 per litre having 6 per cent fat and specific gravity of 1.030 as required in the tender notice, thus, giving a rate of Rs. 421/- for each 100 litres. Respondent No. 4, General Manager, Government Milk Scheme, Pune, also submitted a tender but the tender of respondent No. 4 related not to the item asked for in the tender notice viz. fresh buffalo or cow milk but related to the supply of pasteurized milk. While the cow milk asked for in the tender provided for 4 per cent fat with a specific gravity of 1.029, respondent No. 4 agreed to supply pasteurized milk for Rs. 4/- per litre, that is, Rs. 400/- per 100 litres.

6. It appears that after the submission of the tender, the appellant received a notice, dated October 30, 1985 from respondents Nos. 2 and 3 requesting the appellant to extend the validity period of tender up to November 30, 1985 on the same terms and conditions as mentioned in the tender submitted by the appellant. The appellant acceded to the request and extended the validity period till November 30, 1985 in view of the long standing business and his good relations with respondents 2 and 3.

7. During this period respondents 2 and 3 kept on receiving supplies of fresh buffalo milk to the satisfaction till the appellant was asked to stop the su