The central legal point established in the judgment is that government actions in contractual matters must be free from arbitrariness and adhere to rational, fair, and transparent standards, as mandated by Article 14 of the Constitution.

A.M. Badar, J.

1. Heard. Rule. With consent of parties, Rule is made returnable forthwith.

2. By the instant petition, the petitioner, which is a private limited Company, is praying for quashing and setting aside the tender notice No. 31/201314, published by the respondent No.1 – Maharashtra Industrial Development Corporation, Mumbai (For short, “the MIDC”), and for declaring that the action of the respondent No.1 in inviting fresh tenders for the work which was already tendered by it, is contrary to the principles of natural justice and fair play.

3. Facts, necessary for deciding the instant petition can be summarized as under:

In response to tender notice bearing No. 17/2013-14, issued by the respondent No.1 – MIDC, the petitioner company which is A-Class Electrical contractor, has submitted its tender for providing, erecting and commissioning of 33/11kv sub station, 2 x 10 MVA Transformer and 6 outgoing feeder substation in SEZ of Shendra Five Star Industrial Area in District Aurangabad. The tender process was in two stages. First stage involved technical evaluation and the second stage involved financial evaluation of the bids submitted by the tenderers.

It is case of the petitioner that for this work estimated to cost Rs. 9,49,54,598/-, apart from the petitioner company, 8 other contractors had also submitted their offers. As scheduled, technical bids were opened and out of 9 tenders, only 3 tenders including that of the petitioner company, were found to be eligible and qualified for opening of financial bids. On 5.12.2013, upon opening the financial bids submitted by the eligible tenderers, it was found that the petitioner company has quoted rates 19.25% below the estimated cost, whereas, other two tenderers, namely, Jaikumar Enterprises and Veena Electricals Pvt. Ltd, had quoted rates respectively 9% and 18%, below the estimated cost of the tender work.

As bid of the petitioner company was lowest, the Superintending Engineer (respondent No.2) and the Executive Engineer (respondent No.3) of the MIDC recommended the higher authorities that the tendered work be given to the petitioner company. The petitioner was expecting that as its bid was the lowest, it will be accepted. However, to the surprise of the petitioner, respondent No.1 MIDC published a tender notice bearing No. 31/201314, in local daily newspaper dated 26.2.2014. By this tender notice No. 31/2013-14, respondent MIDC, invited tenders for the same work which was included in tender notice No. 17/2013-14, in which process, the petitioner company was found to have quoted the lowest rate.

According to the petitioner, in this way, respondents have exercised power in arbitrary manner with malafide intention and ulterior motive, just to favour one of the contractors, who was disqualified in technical bid regarding tender notice No.17/201314. Under the influence of unsuccessful tenderer, the respondent MIDC, according to the petitioner, decided to recall the entire tender process, by adopting the procedure which is totally unfair to the petitioner.

The Petitioner further contended that if respondents are allowed to continue with the tender process in pursuance to the tender Notice No. 31/2013-14, then, future prospects of the petitioner would be affected, causing injustice to him.

4. The petition came to be opposed by filing affidavit in reply by respondents. It is not disputed by the respondents that after scrutiny of the tenders received in pursuance to the tender Notice No. 17/2013-14, only 3 tenderers were found to be eligible for opening their financial bids. According to respondents, after noticing this fact at the time of opening of technical bids, the bidders who were found to be ineligible as well as their agents started protesting and created huge mess in the office of respondents. Hence, according to respondents, the process of opening of financial bids which was scheduled on the same day, was required to be postponed to the next day. Respo