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IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD
Aparesh Kumar Singh, CJ, G.M.Mohiuddin, J
Employees State Insurance Corporation – Appellant
Versus
Murali Manpower Agencies – Respondent
WRIT APPEAL No.327 of 2026

Constitutional courts should not interfere with commercial tender decisions unless the process is proven to be arbitrary, mala fide, or perverse. When tender conditions are clear and a bidder participates without reservation, they are estopped from later challenging the evaluation criteria.

Headnote:(A) Constitution of India - Article 226 - Judicial review in tender matters - Scope and extent - Courts must exercise restraint and not sit as appellate bodies over commercial decisions - Interference is warranted only when the decision-making process is vitiated by arbitrariness, mala fides, perversity, or violation of statutory provisions - Courts must defer to the expertise of the employer in interpreting tender conditions. (Paras 11, 15, 16)

(B) Tenders and Contracts - Quality-cum-Cost Based Selection (QCBS) methodology - Discretion of procuring authority - Guidelines providing an illustration of evaluation criteria do not preclude the authority from prescribing additional, rational requirements - Enabling provisions empowering local heads to define evaluation criteria permit flexibility to suit operational exigencies. (Paras 17, 18, 24)

(C) Tender requirements - Doctrine of Estoppel - A bidder having participated in a tender process with full knowledge of the terms and conditions without demur is estopped from challenging the same upon being declared unsuccessful. (Paras 11, 30)

(D) Public Procurement - Procedural Propriety - In proceedings challenging a tender award, all bidders whose interests are directly affected by potential re-evaluation are necessary parties; failure to implead them renders the petition bad for non-joinder. (Para 35)

Facts of the case:
An unsuccessful bidder challenged the award of a security manpower service tender, alleging that the tender conditions, including turnover slabs and technical experience requirements, deviated from departmental guidelines. The lower court set aside the award, directing a fresh evaluation. The state entity appealed, contending that the conditions were within the permissible scope of the procurement manual and established judicial norms.

Findings of Court:
The Court held that the appellant had not violated any binding guidelines, as the tender document derived authority from enabling clauses allowing for institutional-specific criteria. The turnover requirements and technical thresholds were found to bear a rational nexus to the intended objective of ensuring operational stability in a high-stakes healthcare environment.

Issues: Whether the tender conditions constituted arbitrary deviations from established guidelines and whether the judicial interference in the tender process was warranted under the scope of Article 226.

Ratio Decidendi: Judicial review is limited to the decision-making process. The court concluded that the tender authorities acted within their commercial wisdom and governing manuals. The conditions were objective, applied uniformly, and the legal challenge by a participant who failed to lodge timely objections regarding terms is legally untenable.

Result: Appeal allowed. Ordered the lower judgment set aside and restored the tender award.