An authority can legally cancel a tender process prior to the award of the contract if the Notice Inviting Tender (NIT) contains a clause reserving such a right, and the bidder is bound by the terms they voluntarily accepted upon participation.

ORAL ORDER

(Per: HONOURABLE MR. JUSTICE SUDHIR SINGH)

4 04-02-2026 Following is the relief sought for in the present writ application:-

“I. For setting aside the minutes of the departmental tender committee Dated 05.07.2025 headed by the Additional Chief Secretary, Rural Works Department, whereby the financial bid already opened on 03.06.2025 and decided in favour of the petitioner with respect to item Serial No.- 17 of N.I.T. No. MR-3051-07/2024-25 Dated 05.11.2024 has been resolved to be cancelled unilaterall on the ground that the petitioner did not have bid capacity on the date of opening of financial bid and finally it has been cancelled.

II. For setting aside the fresh N.I.T. issued vide N.I.T. Re-tender No. MR-3054-02/2025- 26 Dated 11.07.2025 to the extent of item Serial No. 1, which has been issued for the same work in which the petitioner had already been declared as L1.

III. For issuance of direction to the respondents authorities to execute agreement with the petitioner on the basis of financial bid Dated 03.06.2025 relating to Item Serial No. 17 of N.I.T. No. MR-3054-07/2024-25 Dated 05.11.2024.

IV. For that any other relief/reliefs for which the petitioner may be deemed entitled to.”

2. The brief facts of the present case are that the petitioner had participated in the NIT No. – MR-3054-07/2024- 25 published by the respondent department dated 05.11.2024. The petitioner was declared technically qualified in the same vide decision of the technical evaluation committee dated 02.06.2025. Thereafter, the financial bids were opened on 03.06.2025, wherein the petitioner was declared to be L1. However, the tender evaluation committee after opening of the financial bids reconsidered the matter on 05.07.2025 and it was found that petitioner did not have sufficient bid capacity. The respondent department in view of this finding, cancelled the tender in question and issued directions for a fresh tender.

3. The learned counsel for the petitioner submits that the petitioner had sufficient bid capacity for the work in question on the date of submitting his bid. The learned counsel for the petitioner also submits that the impugned order was issued without giving any show cause notice to the petitioner, and as such the principles of natural justice has been violated. The learned counsel further submits that the impugned order is highly arbitrary, illegal, malicious and a result of colorable exercise of power.

4. A counter affidavit has been filed on behalf of Respondent nos. – 2 to 6. From the perusal of the said counter affidavit, it is apparent that the bid capacity of the petitioner is less than the quoted rate. The relevant paragraphs of the counter affidavit is reproduced as under:-

“11. That pursuant to aforesaid recommendation the Financial Bid of the tender in question was opened on 03.07.2025 and the Bidder M/S Star Construction was declared Lowest Quoted Bidder (L1) for the tender in question.

12. That thereafter the Bid Capacity of the petitioner was calculated during which it came to the notice regarding existing commitments petitioner in of various works divisions prior to award of Tender ID. 137506 which are as follows:-

i. Work Allotment of Total Value Rs.168.61302 Lakhs in Works Division Pakridayal (MR-N/24-25 Pakaridayal/01 Tender Id-137499) vide Chief Engineer 5 letter no 562 dated 21.02.2025.

ii. Letter of Acceptance (LOA) for the execution of Package No. RRSMP/24-25 Pakridayal/-04 under 4515 MMGSUY (RRSMP for Contract Price of Rs. 160.28463 Lakhs vide Executive Engineer, Works