IN THE HIGH COURT OF MADHYA PRADESH
Sujoy Paul and Shailendra Shukla, JJ.
Piyush Kumar Sheth v. State of M.P.
Writ Petition No. 9780 of 2021 (I); Decided on 15.6.2021*
(1) Constitution of India -- Art. 226 -- scope --contract -- scope of interference by writ Court is limited -- cannot sit in appeal on decision of department unless it is arbitrary, capricious or malicious in nature or attracts Wednesbury principles. (1994) 6 SCC 651, (2015) 15 SCC 137, (1993) 1 SCC 44, (2005) 6 SCC 138 and (2012) 8 SCC 216 followed. [Para 9]
(2) Constitution of India -- Art. -- 226 -- scope -- interference in decision of department -- can be made if decision runs contrary to public interest. (1991) 1 SCC 492, (2000) 2 SCC 617, (2007) 14 SCC 517, (2007) 8 SCC 1, (2014) 3 SCC 493 and (2014) 11 SCC 288 followed. [Para 10]
(3) Constitution of India -- Art. -- 226 --tender -- petitioner single bidder -- department decided to cancel and issue fresh NIT -- challenged -- administration is best suited to take decision in matter of contract -- cannot be said that cancellation of tender is wholly impermissible -- no enforceable right created in favour of petitioner -- writ petition dismissed. (2016) 14 SCC 172 followed. [Paras 11, 14 & 15]
¼1½ Òkjr dk lafoèkku & vuqPNsn 226 & O;kfIr & lafonk & fjV U;k;ky; }kjk gLr{ksi dh O;kfIr lhfer gS & foÒkx d¢ fofu'p; ij vihy esa ugha cSB ldrk tc rd fd og euekuk] vuqfpr ;k fo}s"kiw.kZ çÑfr dk ugha g¨ vFkok osUlcjh fl)kar¨a d¨ vkdf"kZr ugha djrk g¨A ¼1994½ 6 ,l lh lh 651] ¼2015½ 15 ,l lh lh 137] ¼1993½ 1 ,l lh lh 44] ¼2005½ 6 ,l lh lh 138 rFkk ¼2012½ 8 ,l lh lh 216 vuqlfjrA ¼iSjk 9½
¼2½ Òkjr dk lafoèkku & vuqPNsn 226 & O;kfIr & foÒkx d¢ fofu'p; esa gLr{ksi & fofu'p; y¨dfgr d¢ çfrdwy gks rks fd;k tk ldrk gSA ¼1999½ 1 ,l lh lh 492] ¼2000½ 2 ,l lh lh 617] ¼2007½ 14 ,l lh lh 517] ¼2007½ 8 ,l lh lh 1] ¼2014½ 3 ,l lh lh 493 rFkk ¼2014½ 11 ,l lh lh 288 vuqlfjrA ¼iSjk 10½
¼3½ Òkjr dk lafoèkku & vuqPNsn 226 & fufonk & ;kph ,dek= c¨yh yxkus okyk & foÒkx us jn~n dj u, fljs ls fufonk vkea=.k lwpuk tkjh djus dk fofu'p; fd;k & vk{ksfir & lafonk d¢ ekeys esa fofu'p; djus d¢ fy, ç'kklu lcls mi;qDr gS & ;g ugha dgk tk ldrk fd fufonk dk jn~ndj.k iw.kZr% vuqKs; gS & ;kph d¢ i{k esa d¨Ã çorZuh; vfèkdkj l`ftr ugha & fjV ;kfpdk [kkfjtA ¼2016½ 14 ,l lh lh 172 vuqlfjrA ¼iSjk 11] 14 ,oa 15½
ORDER
Paul J:- 1. In this petition filed under Article 226 of the Constitution of India, the challenge is mounted to order dated 27.5.2011 (Annexure- Writ Petition No.9780/2021 2 P/9 and P/10), whereby the tender of petitioner has been cancelled. The challenge is also made to the new N.I.T. issued on 27.5.2021.
2. Shri Sethi, learned senior counsel urged that the pivotal question in the case is whether the respondents are justified in cancelling the tender of the petitioner when admittedly his bid was of more than 75 crores, whereas the reserve price was only 72.6 crores. His technical and financial bids were accepted. The reserve price fixed was much above the price to be fixed as per Collector guidelines. Petitioner's bid was shown to be accepted on 26.05.2021 on the portal of the Government. The decision of cancellation of bid could have been taken by Finance Committee and not by the Cabinet. The new N.I.T. again quotes the same reserve price of rupees 72.61 crores. Since the petitioner's bid was much above the reserve price aforesaid, there was no justification in cancelling the bid.
3. It is further submitted that although the petitioner was the single bidder, there is no justification for cancelling his tender. The decision to cancel the tender is arbitrary and runs contrary to the judgment of Supreme Court reported in (2001) 8 SCC 491 (Union of India & others v. Dinesh Engineering Corporation & another).
4. Lastly, learned senior counsel submits that the Supreme Court by order dated 27.7.2019 issued directions to the Department to undertake an exercise pursuant to which they were required to initiate tender process within two years. The tender so cancelled was issued in obedience of apex Court's order. Cancellation thereof violates Court order.
5. Shri Pushyamitra Bhargav, learned Additional Advocate General opposed the prayer by contending that various clauses of N.I.T. namely 2.1.11, 3.3, 3.7 and 3.8 permit the respondents to cancel Writ Petition No.9780/2021 3 the tender at any stage. No right has been created in favour of the petitioner. A conscious decision was taken at apex level which is reflected in the letter dated 28.05.2021 to cancel the tender which cannot said to be arbitrary, malicious and capricious in nature. Moreso, when petitioner was admittedly the single person who submitted his bid. Reliance is placed on certain judgments namely (2012) 8 SCC 216 (Michigan Rubber (India) Limited v. The State of Karnataka, (2000) 5 SCC 287 (Monarch Infrastructure (P) Limited v. Commissioner Ulhasnagar Municipal Corporation & others) and MANU/KA 80618/2009 (Mahendra Labs Pvt. Ltd. v. Principal Secretary to Government Animal Husbandry and Fishries Department).
6. In rejoinder submissions, Shri Sethi, learned senior counsel submits that petitioner's tender was cancelled on 27.5.2021, whereas document dated 28.5.2021 filed with the return shows that Cabinet took decision on 28.5.2021. For this reasons also, impugned order is arbitrary and bad in law.
7. No other point is pressed by the learned counsel for the parties.
8. We have heard learned counsel for the parties at length and perused the record.
9. This is trite that in matters of contract the scope of interference by this Court is limited. This Court cannot sit in appeal on the decision of the department unless such a decision is shown to be arbitrary, capricious or malicious in nature or it attracts Wednesbury principles. (See:- Tata Cellular v. Union of India, (1994) 6 SCC 651 and Elektron Lighting Systems (P) Ltd. v. Shah Investments Financial Developments & Consultants (P) Ltd., (2015) 15 SCC 137, Sterling Computers Ltd. v. M & N Publications Ltd., (1993) 1 Writ Petition No.9780/2021 4 SCC 44, Master Marine Services (P) Ltd. v. Metcalfe & Hodgkinson (P) Ltd., (2005) 6 SCC 138, Michigan Rubber (India) Ltd. v. State of Karnataka, (2012) 8 SCC 216 ).
10. Interference can also be made if decision runs contrary to the public interest. (See:- Raunaq International Ltd. v. I.V.
SupremeToday
Courts should exercise restraint in interfering with tender matters and should only do so in cases of gross arbitrariness, discrimination, malafides, or bias.
The court upheld the principle that tenders are to be evaluated based on rules prevailing at the time of issuance, and subsequent amendments do not apply retroactively.
The court clarified that no opportunity of hearing is required for the lowest bidder before cancellation of a tender notice, as no vested right exists until the bid is confirmed.
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.