The award of a contract without inviting tenders is arbitrary and violative of Article 14 of the Constitution of India if it is not in accordance with the law or if it is based on irrelevant considerations.

S. PARVATHA RAO, J.

( 1 ) THE four petitioners in this writ Petition question the action of respondents 1 and 2 in awarding the contract of laying r. C. C. pressure main in the lift irrigation 45 scheme sanctioned for Edupuram village in kaviti Mandal of Snkakulam district to the 3rd respondent without inviting tenders for awarding of the said work as illegal, violative of Article 14 of the Constitution of India apart from being vitiated by mala fides etc. The value of the said work awarded to the 3rd respondent is rs. 30,45,075-10 ps. It consists mainly of earth work excavation, manufacture of R. C. C. hume pressure pipes, sockets, spigot pipes and 5 suitable rubber rings of the required specifications, transportation of the same to the site, laying and jointing, testing and commissioning of the pipes in position including conveyance of all material and labour charges and refilling of excavated earth over the pressure pipe line etc. , for State I and Stage II.

( 2 ) EDUPURAM Life Irrigation Scheme (E. L. I. Scheme for short) on Bahuda river near Edupuram village in Ichapuram Mandal was administratively approved by the District collector in Proceedings, dated 12-2-1994 and was technically sanctioned by the 1 st respondent-Corporation for Rs. 80 lakhs. One of the works in the said scheme is laying of R. C. C. 20 pressure-main for which R. C. C. pipes are necessary. The petitioners state that they set up spun pipe industry in Srikakulam District after obtaining loan under self-employment schemes. They state that the spun pipes manufac25 tured by them are mainly used for Lift Irrigation schemes as well as Water Supply Schemes in Municipalities. Coming to know of the e. L. I. Scheme they approached the 2nd respondent, i. e. , the Executive Engineer of the 30 1 st respondent-Corporation for Srikakulam division, for allotment of the said work to them. They allege that he demanded 10% cost of the work as bnbe to him and they expressed their inability to pay the same to him. They ex-55 pected that tenders would be called for the said work. But they found that, without calling for tenders, the 2nd respondent entrusted the work to the 3rd respondent herein. They allege that the award of the said work to the 3rd respondent amounts to undue favour shown to it and that it is vitiated by mala fides. They allege that to their knowledge this was the first time when such a contract involving a large amount of rs. 35 lakhs was awarded through, what they allege, pnvate negotiations without calling for tenders by publishing in news papers, tender digest or otherwise. They also allege that works of this nature ought to be awarded only by inviting tenders and in open manner and not secretively. They state that they are having small scale units in Srikakulam district itself for the manufacture of necessary pipes etc. , suitable for the purpose of the said work. They also state that there are instructions of the Government of Andhra Pradesh given for time to time mat as far as possible local self- employed units should be preferred over others. They allege that contrary to the said instructions the 1st and 2nd respondents chose to give the work to the 3rd respondent. They further contend that the 2nd respondent had no authority to give the work of such magnitude to the 3rd respondent by negotiations.

( 3 ) THE present Wnt Petition was presented on 29-9-1994 and Notice before admission was ordered on 18-10-1994. Mrs. Balaram, the learned Standing Counsel for the 1 st respondent, takes notice for respondents 1 and 2 and subsequently Mr. P. Sitarama Raju filed his appearance forthe 3rd respondent. The 2nd respondent gave counter-affidavit dated 7-10-1994 and additional counter-affidavit dated 11-11-1994. On behalf of the 1 st respondent, its Vice Chairman and Managing Director filed counter-affidavit dated 15-12-1994. On behalf of the 3rd respondent, its Managing partner gave counter-affidavit dated 31-10-1994. On behalf of the petitioners, the 1 st pet

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