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2016 Supreme(Ori) 981

IN THE HIGH COURT OF ORISSA: CUTTACK
S.C. PARIJA, J.
W.P.(C) No.124 of 2015
&
Misc. Case No. 188 of 2015
(Date of Judgment : 22.01.2016)
M/s. Sree Venkateswara Enterprises... Petitioner
Versus
Union of India & three others ... Opp. Parties

Headnote:1. JUDICIAL REVIEW - Tender - Judicial review of administrative action is intended to prevent arbitrariness, irretionality, unreasonableness, bias and malafides - Its purpose is to check whether choice or decision is made “lawfully” and not to check whether choice or decision is “sound” -When the power of judicial review is invoked in matters relating to tenders or award of contracts, certain special features should be borne in mind - A Court would interfere in a tender or contractual matters in exercise of its power of judicial review only if the process adopted or decision taken by the authority is found to be malafide or arbitrary or irretional, which affects public interest. (Para - 14)

       2. TENDER - Judicial review - A contract is a commercial transaction - Evaluating tenders and awarding contracts are essential commercial junctions - Principles of equity and natural justice stay at a distance - If the decision relating to award of contract is bonafide and is in publilc interest, Courts will not, in exercise of power of judicial review, interfere even if a procedural aberration or error if made out - Power of judicial review will not be permitted to be involved to protect private interest at the cost of public interest, or to decide contratual disputes - Further stated.

       The tenderer or contractor with a grievance can always seeks damages in a civil Court. Attempts by unsuccessful tenderers with imaginary grievances, wounded pride and business rivalry, to make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade Courts to interfere by exercising power of judicial review, should be resisted. Such interference, either interim or final, may hold up public works for years, or delay relief and succour to thousands and millions and may increase the project cost manifold. (Para - 14)

ORDER

Per S.C. PARIJA, J.

22.01.2016 1. Heard Shri Asok Mohanty, learned Senior Counsel for the petitioner and Shri N.K. Barik, learned counsel for the Railway-opposite party nos. 3 and 4.

2.This writ petition has been filed praying for a direction to the Railway authorities to cancel the Bid Notice dated 30.5.2014, issued by East Coast Railway, Bhubaneswar, inviting bids on single stage two packet system from food and catering service providers for “Provision of Catering Services at Major Static Unit Name [AVM] at Bhubaneswar [A1 category] and Cuttack [A category] Stations of Khurda Road Division “. Accordingly, a prayer has been made to direct the Railway authorities to float a fresh tender for the said contract work and till finalization of such tender, the petitioner firm be permitted to run the AVM stalls at Cuttack and Bhubaneswar railway stations.

3.The brief facts of the case as detailed in the writ petition is that pursuant to tender floated by the Chief Regional Manager, East Coast Railway, Bhubaneswar, for operating automatic vending machines on license basis, M/s. Pepsi Foods Pvt. Ltd., having its office at Gurgaon, in the State of Haryana, participated in the said tender and was granted the license to operate the automatic vending machines (‘AVM’ for short) on license basis in different railway stations, including the railway stations in the State of Orissa. For operation of such AVM, the Railway authorities allotted vacant place at the concerned railway stations for establishment of Kiosks, in which the AVM machines were to be installed and operated. For the said arrangement, Indian Railway Catering & Tourism Corporation Ltd., (“IRCTC” for short) entered into an Agreement with M/s. Pepsi Foods Pvt. Ltd., for management of AVM Dispensing Kioska for sale of hot and cold beverages at the railway stations. The present petitioner, who is involved in the business of catering of hot and cold beverages, entered into a Franchisee Agreement with M/s. Pepsi Foods Pvt. Ltd. for managing the AVM Dispensing Kiosks for sale of hot and cold beverages at different railway stations since January 2009, which was approved by the IRCTC.

4.In the year 2010, the Ministry of Railways formulated a new Catering Policy-2010 and pursuant to such policy, a Tripartite Agreement was entered into between the East Coast Railway, IRCTC and M/s. Pepsi Foods Pvt. Ltd., under which the management of AVM Dispensing Kiosks at the Bhubaneswar and Cuttack railway stations were taken over by East Coast Railway. The said Tripartite Agreement provided that the existing license i.e. M/s. Pepsi Foods Pvt. Ltd. would continue to operate the AVM Dispensing Kiosks at the platforms in Bhubaneswar and Cuttack railway stations till 18.7.2014, i.e. for the tenure of license awarded by the IRCTC, unless terminated earlier.

5. It is the case of the petitioner firm that even after expiry of the license period, the Railway authorities allowed extension to the petitioner to continue operation of the AVM stalls at Bhubaneswar and Cuttack railway stations for a further period of three months, by increasing 10% of the existing license fees.

6.While the matter stood thus, the Sr. Divisional Commercial Manager, East Coast Railway, issued Bid notice dated 30.05.2014, inviting sealed bid on single stage two packet system from food and catering service providers for “Provision of Catering Services at Major Static Unit Name (AVM) at Bhubaneswar (A1 category) and Cuttack (A category) Stations of Khurda Road Division”, as detailed in the said notice. As the petitioner firm did not fulfill the eligibility criteria prescribed under the Bid Document, he did not submit its bid, however, subsequently the petitioner firm came to learn that after submission of bids, some of the conditions in the Bid Document have been relaxed, as a result of which, the petitioner firm has been deprived of submitting its bid. Pursuant to the floating of the tender and finalization of the same in favour o














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