The main legal point established in the judgment is the importance of fair play, reasonableness, and non-arbitrariness in the decision-making process of public contracts, emphasizing the assessment of past performance and the consideration of quality of goods in addition to the price offered.

D.K.JAIN, J.

1. Rule DB.

2. Having regard to the urgency of the matter, with the consent of learned counsel for the parties, it is taken up for final disposal at this stage itself.

3. Challenge in this writ petition, under Article 226 of the Constitution of India, is to the legality and propriety of the decision of Punjab State Electricity Board, respondent No. 1 herein, (hereinafter referred to as the Board ), to award the tender of supply of 148 transformers of 220 KV CTs of various ratios to respondent No. 3. The Chief Engineer, Design Directorate, Patiala is impleaded as respondent No. 2.

4. The factual matrix, on which the foundation of this judicial action is laid, is as follows :

Some time around early February, 2005, the Board, invited tenders for supply of the aforementioned transformers of four different types. The last date for submission of the tenders was 11-3-2005 and the bids received were to be opened on the same day at 11.30 a.m. In the tender notice, it was, inter alia, mentioned that tender specifications will not be issued to the firms, with whom business dealings have been suspended or blacklisted and debarred firms; no specification/tender document shall be issued to the firms who are defaulters for 25% or more quantity for more than 9 months or any quantity for more than 15 months in making the supplies against earlier purchase orders; the tender documents shall be issued only to those bidders, who have manufactured and delivered the material/equipment of similar or higher rating to an Electricity Board/Utility and a performance certificate for at least two years is submitted by two end users with the request for purchase of tender document and the turnover during last three financial years was more than Rs. 6 crores as well as the total value of similar equipment supplied during last three years was more than Rs. 1.5 crore. Petitioner No. 1-Company, who claims to be in the business of manufacture of electrical equipment for the last more than 10 years, and had supplied to the Board more than 2,000 transformers in the past, submitted its bid for supply of the said transformers. When the bids were opened on 11-3-2005, the bids of five tenderers, including petitioner No. 1 and respondent No. 3, were found to be valid. The offer of petitioner No. 1 was found to be lowest (L-1) in respect of the first three categories and the rates quoted by respondent No. 3 were found to be the lowest in respect of the fourth category. It is averred in the petition that the petitioner-Company, being the lowest tenderer, was sanguine of getting the offer, but somehow the officers of the Board chose to ignore its offer for extraneous considerations in order to favour respondent No. 3. Petitioner No. 1 claims to have learnt on or after 11-3-2005 that respondent No. 3 did not fulfil the condition of supplying similar equipment, namely, transformers of 220 KV CTs or above rating during the last three years. Accordingly, the petitioner-Company objected to the issue of tender forms to respondent No. 3 vide its letter dated 13-4-2005. It is alleged that despite their representations, no enquiry was conducted by the Board and letter of intent for supply of 148 transformers was issued in favour of respondent No. 3. Hence, the present writ petition.

5. Pursuant to the notice of motion, written statements on behalf of the respondents have been filed. The petition is resisted mainly on the ground that the petitioner cannot ask for acceptance of its tender as a matter of right. It only had a right to apply for being considered, which has been duly done. It is stated that on receipt of the tenders from the eligible firms, these were scrutinised by a Committee, known as Project Purchase Committee, constituted under Regulation 8 of the Punjab State Electricity Board Purchase Regulations, 1981, as amended from time to time. The five quotations received were opened in the presence of representatives of the firms; comparative statement