JUDGMENT

1. The sole question, that falls for consideration, in the present writ petition, is whether a Statutory Corporation, created under a Central Legislation, namely, the Warehousing Corporation Act, 1962, can put a condition in its tender notice which renders persons residing in other States, ineligible for submitting bids? In other words, whether under our Constitutional Scheme, such classification based on place of residence for entering into contract with a Statutory Corporation, would be permissible?

2. The facts, on which there is no dispute, are that petitioner is a resident of District Saharanpur in State of Uttar Pradesh, who deals in handling and transport of food-grains and other articles. He is also a registered contractor with Uttarakhand State Warehousing Corporation (from hereinafter referred to as “Corporation"). The said Corporation has been established in the year 2016 under the provisions of the Warehousing Corporation Act, 1962. It issued ae-tender notice on 02.12.2019, whereby bids were invited for appointment of registered contractors for handling &transportation of food-grains/fertilizers and other allied material, as stored by F.C.I., R.F.C. and other agencies at its different warehouses. The said e-tender document is enclosed as Annexure – 1 to the writ petition. It also contains a list of documents which are required to be uploaded by each bidder with his Technical Bid.

3. Petitioner is aggrieved by Clause 19 & 21 of the list of documents, as contained in the e-tender document. According to the petitioner, the conditions mentioned in Clause 19 & 21 have the effect of altogether ousting him from the zone of consideration. Those conditions are extracted below:-

“19. Copy of Residence certificate issued by Sub District Magistrate/Tahsildar in uk government only.

21. The registered contractors in UKSWC who belongs to uttarakhand state will only participate in the tenders having Estimated value of less than 5 crores. The tenders having Estimated value of more than 5 cores will be participated to all registered contractors of UKSWC."

4. Petitioner has challenged the aforesaid two conditions in the e-tender notice, as being arbitrary and illegal. It is the contention of learned counsel for the petitioner that Uttarakhand State Warehousing Corporation, being ‘State' within the meaning of Article 12 of the Constitution of India, cannot put such arbitrary condition, which renders residents of other States ineligible for submitting their bids. He further submits that such condition violates fundamental rights of the petitioner.

5. Learned counsel for the Corporation however submits that the aforesaid conditions were inserted in the e-tender notice on the strength of decision taken by Board of Directors of the Corporation in its meeting held on 12.08.2019. Minutes of the said meeting are on record as Annexure No. 5 to the writ petition.

6. In the said meeting, Board of Directors resolved that, for award of contract for civil construction work as well as for handling/transportation services, persons who are permanent residents of Uttarakhand alone shall be eligible. The said decision refers to an amendment in Uttarakhand Procurement Rules, 2017 made vide notification dated 02.04.2018.

7. Learned counsel for the petitioner submits that by the said amendment in the Uttarakhand Procurement Rules, 2017, a proviso was addedin Rule 3 (6),which provides that civil construction work under State sector by different government agencies upto the value‘ 5 Crore, can be done through permanent residents/locally registered firms.

8. Rule 3(6) of the Uttarakhand Procurement Rules, before its Amendment, reads as under:-

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9. Rule 3(6) of the aforesaid Rules, after its amendment vide notification dated 02.04.2018, reads as under:-

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