The court upheld the rejection of the petitioner's offer based on the criteria and principles outlined in the tender notice, emphasizing the authority of the State Government to reject tenders and the principles of lawful consideration and object in contracts.

H.N. Sarma, J.

1. The State respondents having appointed respondent No. 4 as PDS whole sale Nominee-cum-Miller-cum-carriage contractor in respect of PDS wheat for Zone IV in East Siang District of the State of Arunachal Pradesh and thereby rejecting the offer of the petitioner vide order dated 7.3.2008, the appellant unsuccessfully challenged the said order in W.P. (C) No. 157 (AP) of 2008 which is the subject-matter of the present appeal.

2. We have heard Mr. R.P. Sarma, learned Senior counsel appearing for the appellant/writ petitioner, Mr. N. Dutta, learned Advocate General, Arunachal Pradesh, assisted by Mr. B. Banerjee, learned Govt. Counsel, Arunachal Pradesh and Mr. M.G. Singh, learned Counsel appearing for the private respondent.

3. To put in short the relevant facts for the disposal of the appeal may be stated as follows:

The State of Arunachal Pradesh issued a NIT on 7.12.2008 inviting application for appointment as PDS Wholesale Nominee-cum-Miller-cum-Carriage Contractor for PDS wheat in respect of Zone IV comprising of East Siang, Upper Siang, West Siang and Upper Subansiri Districts, Arunachal Pradesh. In pursuance to the aforesaid NIT, the appellant/petitioner submitted his offer and participated in the tender process. The petitioner's firm was found to be the lowest and genuine bidder and was recommended for said appointment by the Board so constituted for selection of the tenders and accordingly, the appellant/petitioner was recommended for such appointment and forwarded the same to the State Government for further necessary action therein. However, the Govt. authority namely, Secretary to the Food & Civil Supplies Department, Arunachal Pradesh instead of appointing the appellant/petitioner's firm as per the recommendation of the Board, passed the impugned order dated 7.3.2008 appointing the respondent No. 4 as PDS Wholesale Nominee-cum-Miller-cum-Carriage Contractor for PDS wheat for Zone IV. Aggrieved by the said action of the respondents, the petitioner challenged the same by filing writ petition.

4. Both the State respondents and private respondent contested the proceeding by filing their respective counters. The contention of the State respondents inter alia is that the offer of the petitioner firm was rejected by the Govt. in view of the adverse comments of the Board in its recommendation to the effect that the petitioner had offered the price bid/revenue below the required minimum of 10% of the profit margin fixed by the Department in terms of paras 8 to 10 of the terms and conditions of the said tender notice. The price bid offered by the private Respondent No. 4 i.e. M/s. Y. Gangkak, Aal'c was 15% of the profit. So instead of accepting the petitioner's firm whose price bid and/or revenue offered is hardly 8.2% and which, in fact, is less than the minimum 10% fixed by the Department, the Govt. accepted the higher bid offered by the private respondent No. 4. Further, in terms of, para 26 of the terms and conditions of the tender notice, final acceptance of any tender lies with the State Government which reserves the right to reject any or all tenders without assigning any reasons whatsoever. It is contended that the mere recommendation of the Board is not binding upon the Govt. and as such, action of the respondents/authorities to accept the tender of the Private respondent No. 4 who fulfils the guidelines contained in terms and conditions of the tender notice and the higher revenue expected, being valid, the contract was allotted to the private respondent No. 4. The further contention of the State respondents is that the Board did not recommend a particular firm but recommended 3 firms with adverse comments against 2 of the firms including the petitioner's firm. Hence, it was left to the State Government to decide the final acceptance after examining the merit of each recommendation as per the laid down principles of law. It is also contended that in pursuance to para 10 of the detailed terms and con