HIGH COURT OF JAMMU & KASHMIR AND LADAKH
Moksha Khajuria Kazmi, J
Vinkal Sharma – Appellant
Versus
UT of J&K – Respondent
WP(C) No. 2580/2022 | CM No. 3213/2023

Judicial review in tender matters is restricted to cases of clear arbitrariness or mala fides. Courts should not interfere with technical tender conditions or commercial decisions, particularly when an agency's previous blacklisting has expired, as blacklisting cannot be perpetual and must be proportional.

Headnote:(A) Constitution of India - Articles 14, 16(1) and 226 - Judicial review in contractual matters - Tender conditions - Scope of interference - Courts should exercise restraint in judicial review of commercial contracts involving technical issues - Interference is warranted only in cases of arbitrariness, irrationality, mala fides, or bias - Courts must give 'fair play in the joints' to government authorities - (Paras 44, 47, 55, 56, 59, 60)

(B) Tender Process - Blacklisting - Debarment is not permanent and must be for a specified period and proportional to the nature of the offence - Once a debarment period concludes, the entity's right to participate in tenders is revived - Tender conditions requiring an agency to not be blacklisted 'as on date' are legally permissible and within the domain of the tender-inviting authority. (Paras 49, 51, 52)

Facts of the case:
The petitioners, who are job aspirants, challenged an e-tendering process for the recruitment of candidates through an online Computer Based Test (CBT) mode. They contended that the successful bidder was a tainted agency with a history of blacklisting and involvement in examination irregularities across various jurisdictions. The petitioners sought to annul the contract on the grounds of lack of fairness, transparency, and apprehension of future misconduct. The respondents maintained that the process followed due diligence, that the agency was not currently blacklisted, and that the petitioners lacked locus standi.

Findings of Court:
The Court held that judicial review in government contracts is limited. It noted that the government has the discretion to formulate tender terms. It observed that the company was not blacklisted 'as on date' and that permanent blacklisting is not permissible in law. The Court emphasized that there were no mala fides in the selection process, which included a third-party audit and security measures. The existence of a government-constituted review committee further addressed the petitioners' apprehensions regarding the fairness of the recruitment process.

Issues: (i) Whether the writ petition is maintainable for a person who lacks genuine locus standi or is merely acting on apprehensions; (ii) Whether an entity that has completed a debarment period is eligible to participate in fresh tenders; (iii) The scope of judicial scrutiny into tender eligibility criteria.

Ratio Decidendi: The court maintained that (i) Writ jurisdiction cannot be invoked based on mere apprehensions or by those lacking a specific legal injury; (ii) Debarment operates for a fixed period, and after its expiry, an agency regains its right to participate in fair competition; and (iii) Courts should not substitute their opinion for that of the employer in technical/commercial matters unless the decision-making process is tainted by manifest arbitrariness or mala fides.

Result: Disposed of with directions for the Review Committee to submit its report and for the relevant authorities to take a final decision thereafter. Selection process stayed until such decision is taken.