High Courts should refrain from exercising writ jurisdiction in purely contractual disputes involving disputed questions of fact. Even where minimal territorial nexus exists, the doctrine of forum conveniens justifies relegating parties to civil courts for resolution of claims involving contract breach and security forfeiture.

JUDGMENT

N. SATHISH KUMAR, J.

1.Challenging the order of the learned Single Judge allowing the Writ Petition, the present writ appeal has been filed.

2. The brief facts of the case are as follows:

2.1. The first respondent/writ petitioner submitted a bid pursuant to the “Request for Proposal” ( hereinafter referred to as “RFP”) issued by the National Highways Authority for the development of the National Highways, namely, (i) Gorantala–Hindupur and (ii) Mudanur– B. Kothapalli. According to the first respondent/writ petitioner, the opening of the bids was originally scheduled for 05.09.2023 and 19.12.2023. However, the appellants were unable to adhere to the said schedule and extended the validity of the tender on nearly seven occasions. In the meantime, the first respondent/writ petitioner received a letter dated 13.11.2024 seeking clarification, wherein it was stated that a complaint had been received alleging fabrication of documents by the first respondent/writ petitioner.

2.2. At that stage, the first respondent/writ petitioner realized that, owing to an inadvertent error committed by its staff, certain mistakes had crept into the tender documents. Consequently, the first respondent/writ petitioner withdrew its bid even before the opening of the technical bid. It is, therefore, the contention of the first respondent/writ petitioner that the bid was withdrawn prior to the opening of the bids. However, despite such withdrawal, a show cause notice dated 13.11.2024 was issued by the appellants. The first respondent/writ petitioner submitted its reply on 19.11.2024. Thereafter, by order dated 03.03.2025, the appellants directed forfeiture of the bid security amount. Aggrieved by the said order, the first respondent/writ petitioner filed the above writ petition.

2.3. Before the learned Single Judge, the appellants/respondents raised a preliminary objection regarding the territorial jurisdiction of this Court. However, reliance was placed on Clause 4.1 of the RFP, which authorizes the appellants/respondents to forfeit and appropriate the bid security amount as damages, without prejudice to any other rights available to them. The clause further stipulates that the appellants/respondents need not establish or prove any actual loss or damage for effecting such forfeiture.

3. The learned Single Judge, after considering the submissions advanced on either side, held that the writ petition was maintainable, as at least a part of the cause of action had arisen within the territorial jurisdiction of this Court. The learned Single Judge further held that, in the absence of any proof of actual loss or damage suffered by the appellants, the forfeiture of the bid security amount was unsustainable in law. Accordingly, the writ petition was allowed. Aggrieved by the said order, the appellants have preferred the present writ appeal.

4.The learned Additional Solicitor General of India appearing for the appellants submitted that the entire cause of action arose at Vijayawada. According to him, the tender was invited by the appellants, and the decision regarding forfeiture of the bid security under the terms of the RFP was also taken at Vijayawada. Therefore, no part of the cause of action arose within the territorial jurisdiction of this Court. It was further contended that mere service of a notice upon a party within the jurisdiction of this Court would not, by itself, confer territorial jurisdiction. The learned Additional Solicitor General of India also submitted that the terms and conditions governing the ten