IMPORTANT POINT
Tender – Government is protector of financial resources of State and it has every right to cancel and call for fresh tender if it is in nature of protecting financial interests of State.

JUDGMENT :

PRASANNA B. VARALE, J.

1. Leave granted.

2. The present civil appeals arises out of the common judgment and order dated 19.01.2021 passed by the Hon’ble High Court of Kerala at Ernakulam in writ appeals nos. 1568 of 2020, 1577 of 2020 and 1589 of 2020 whereby the High Court of Kerala dismissed the Writ Appeals by confirming the judgment passed by learned Single Judge.

BRIEF FACTS:

3. The factual matrix of the case is that the Divisional Forest Officer, Konni issued an order dated 12.10.2020 cancelling an earlier e-tender notification dated 25.05.2020 for final tree felling works of 1954 Nellidappara in South Kumaramperoor Forest Station under Konni Range in Konni Forest Division and decided to float a tender afresh. The writ petitioners were participants in the earlier e-tender notification dated 25.05.2020 and according to them, the action of the appellants; to retender the work after cancelling the earlier tender was an arbitrary and illegal action. In fact, the Principal Conservator of Forests issued a circular dated 29.02.2020 in regard to the renewal of registration of A class contractors, wherein it was stipulated that A class registered contractors, who have not participated in any of the tenders notified by the Department for timber extraction during the last financial year, are not eligible to get renewal of the A class registration.

4. On the basis of the said circular, the registration of the petitioners in W.P. (C) Nos. 24075 and 24241 of 2020 were not renewed. However, the appellants had floated the e-tender dated 25.05.2020 for the work in question. The said petitioners, being aggrieved by the said action, have approached Hon’ble High Court by filing W.P. (C) Nos. 11854 and 12389 of 2020 respectively challenging the aforesaid circular dated 29.02.2020, in which interim directions were sought to permit them to participate in the e-tender dated 25.05.2020. Learned Single Judge of the Hon'ble High Court granted interim orders permitting the said petitioners to participate in the tender proceedings provisionally. Learned Single Judge of Hon'ble High Court vide common judgment dated 28.09.2020 allowed the said writ petitions and set aside the impugned orders declining renewal of registration of the petitioners. The Court directed the authority to reconsider their applications for renewal of registration on merits dehors the circular dated 29.02.2020. The reasons given by the High Court for allowing the writ petitions have been reproduced as below:

“.....11. The rules¹ [Rules 6 to 8 of the rules for Registration of Contractors for Working Down Timber Firewood from Timber Depots (Supply Coupe Contracts)] would indicate that the registering authority may refuse renewal of registration for reasons stated as (i) to (iv) in Rule 6. The 4th reason namely "or any other reason which in the opinion of the registering authority makes the applicant unsuitable for such registration" need not be confined to reasons of the nature indicated in Clauses (i) to (iii).....

Firstly, the rules of registration of contractors are not statutory rules but are part of the Kerala Forest Code which is only a compilation of administrative/executive instructions...

12.....Registration or renewal of registration as Contractors is not a fundamental or statutory right. The Government can very well right-size the panel of registered Contractors for the purpose of administrative convenience....

14.....Petitioners as registered Contractors do not hold vested right for renewal of their license.....”

However, the Learned Judge allowed the writ petition on the sole ground that the authorities cannot put a new condition for consideration of applications after the last date prescribed for submission of the applications as it would be highly arbitrary offending Article 14 of the Constitution of India. Thus, it was observed that the refusal of renewal of registration based on circular dated 29.02.2020 is illegal and unsustainable.

5. However, vide order dated 12