The cancellation of a tender based on a quashed blacklisting order without a stay is arbitrary and unsustainable under judicial review, affirming the obligation of authorities to act fairly in public contracts.

JUDGMENT :

HARISH TANDON, CJ.

1. The writ petition was initially filed for writ of mandamus alleging inaction on the part of the authorities in issuing the work order despite having declared the petitioner (s) as the successful bidder in a tender call notice issued by the Works Department, Government of Odisha for widening and strengthening of Bhawanipatna-Gunupur-Kasipur road (SH-44) from 2/500 to 13/095 in the district of Kalahandi under State Plan. Subsequently, the writ petition was amended as the relief claimed therein becomes inappropriate because of the subsequent events and the challenge was made to an order of cancellation of the tender dated 29^th November, 2024.

2. The facts emanating from the writ petition are adumbrated hereinafter.

2.1 The petitioner no.1, being a special class contractor, participated in the said tender and emerged successful on 2^nd February, 2024. Subsequently the decision of the tender committee was sent to the Government for its approval, which was kept in abeyance, which constrained the petitioners to move before this Court by filing the instant writ petition. It is pleaded that the reason for deferment in granting the approval was founded upon the fact that a Special Leave Petition was preferred by the State Government assailing the order dated 22^nd August, 2023 passed in W.P.(C) No. 19439 of 2023 by this Court.

2.2 Before we proceed further, it would be relevant to narrate the facts for initiation of the said writ petition. The petitioner No.1 participated in Deobanda Chandahandi Road tender in the district of Nabarangpur under NABARD Assistance in response to Bid Identification dated 22^nd December, 2021 and was declared successful therein. The petitioner No.2 who was not taking an active participation in the affairs of the firm because of his medical incapacitation, the verification of the documents could not be done within the time stipulated therein, which resulted into the cancellation of the bid and imposition of a blacklisting order. The said order was challenged in the said writ petition [W.P.(C) No. 19439 of 2023] before this Court which was decided in favour of the petitioner, as the order of blacklisting dated 16^th June, 2023 was quashed on the ground of violation of principle of natural justice. Despite the blacklisting order having quashed and set aside by this Court, the portal remained blocked for a considerable period, which was subsequently withdrawn in terms of the order of this Court passed at a later point of time.

2.3 According to the writ petitioners, the reason for keeping abeyance of the approval in relation to the tender involved in the instant writ petition was the pendency of the Special Leave Petition filed against the order passed in the earlier writ petition, wherein the blacklisting order was quashed and set aside, which would be evident from the discussions made in the consecutive meetings dated 13^th February, 2024 and 14^th March, 2024. It is further stated that though the notices were issued in the said Special Leave Petition, but there was no order of stay passed therein by the apex Court, the decision to keep the approval in abeyance is illegal, unjustified and unreasonable. Several orders were passed in the writ petition, yet the decision was not taken by the Government until 29^th November, 2024 by which the said tender in question was cancelled.

2.4 An application for amendment was taken out as the initial prayer for issuance of the work order becomes inappropriate because of the cancellation order passed by the authority and sought to incorporate the factum relating to the cancellation order and the relief was also moulded to the effect that the said cancellation order is i