Key Points: - The appellant reserved the right to reject all tenders and to negotiate for a higher price, and the High Court held this was arbitrary; the Supreme Court held such negotiations can be valid if non-arbitrary and with cogent reasons (!) (!) (!) (!) (!) . - Significant higher bids obtained during negotiations with all tenderers can supersede the highest tender if there is inadequacy in the highest bid, and this must be done with equal opportunity to participate (!) (!) . - Non-arbitrariness requires fair procedure, due weight to legitimate expectations, and cogent reasons for switching to negotiation; mere higher price is not automatically sufficient without cogent grounds (!) (!) (!) (!) . - The decision to negotiate was justified by inadequacy of the highest bid and the opportunity to raise the overall price while maintaining public interest (!) (!) (!) . - The High Court’s view that switching to negotiation after inviting tenders is per se invalid was found to be too wide and not correct; such action can be valid under proper non-arbitrary guidelines (!) (!) . - The appeal was allowed and the High Court judgment set aside; the respondent’s writ petition was dismissed (!) (!) . - Last date for acceptance of offers and the period for maintaining the tender open were relevant to evaluate the legality of negotiating actions (!) .

What is the legality of negotiating with all tenderers after opening tenders to obtain a significantly higher bid?

What are the cogent reasons required to switch from accepting the highest tender to negotiating for higher bids?

What constitutes non-arbitrariness and due consideration of legitimate expectations in a tender disposal process?