Contract allotments by government can be valid if in public interest and reasonableness is established, dismissing allegations of unfair practices in absence of solid proof.

1. This order will dispose of civil writ petition No. 301 of 1984 titled Mohinder Singh Manhas v. State and Civil Writ Petition No. 328 of 1984 titled Sh. Abdul Hamid Qazi v. State.

2. Writ petition No. 301 of 1984 has been filed by Mohinder Singh Manhas and 8 other contractors registered with the State Forest Corporation and it seeks the quashing of allotment of contracts to respondents 6 to 14. Notice was issued to the respondents to show cause against the petition. Objections have been filed on behalf of some of the respondents through their learned counsel. M/s. R. P. Sathi, B. M. Bhardwaj, S. P. Gupta, T. S. Thakur, J. S. Kotwal, R. P.Bashi and S. A. Salaria, appeared on behalf of the respondents to oppose the admission of the petition.

3. In brief the case of the petitioners is that the J and K State Forest Corporation issued a tender notice on 20-3-1984 calling for tenders for allotment of various works of the SFC. The last date for inviting tenders was 31-3-1984. The tender notice was cancelled on 31-3-1984 without assigning any reasons and allotment of contracts was made on the basis of negotiations. Mr. Bhim Singh who appeared for the petitioners argued that allotment of contract by negotiations was not permissible under the J and K Forest Corporation Act, 1978, and that by allotting the contracts through negotiations the authorities had resorted to pick and choose method since no norms had been fixed for holding negotiations. Learned counsel asserted that by the impugned allotments public property had been squandered by the authorities and that the action of the State had caused huge loss to the exchequer. Learned counsel asserted that financial injury had been caused to the public exchequer since contracts had been allotted at exorbitant rates to the favourites of the authorities. He emphasised that where the Government deals with the public by way of entering into contracts it cannot act arbitrarily at its own sweet will at the cost of the State exchequer. Learned counsel has placed reliance on AIR 1979 SC 1628 and AIR 1980 SC 1992 in support of his submissions.

4. The respondents strongly resisted the admission of the writ petition and according to Mr. R. P. Sathi the filing of the petition was mala fide and was actuated by a design to blackmail the Corporation and the contractors in whose favour allotments had been made. It was submitted that the respondents while allotting the work had neither acted arbitrarily nor mala fide and that criteria had been laid down on the basis of which negotiations for allotment of works were held with different contractors including the petitioners. It was maintained that the issuance of tender notice did not confer any right upon the petitioners inasmuch as it was specifically provided in Cl.9 of the tender notice that it was not bound to accept the tender and that the management reserved the right to negotiate the contract with any resourceful and experienced contractors to execute the work successfully. It was pointed out with reference to a chart filed along with the objections by respondents 3, 4 and 5 that the petitioners had participated in the negotiations and since the rates submitted by them were very high as compared to the rates on which the work was allotted to the other contractors by the corporation,