SUPREME COURT OF INDIA
(From the High Court of Delhi at New Delhi)
M.R. Shah, B.V. Nagarathna, JJ.
Union of India – Appellant
Versus
Bharat Fritz Werner Limited & Another – Respondents
Civil Appeal Nos. 1332-1333 of 2022
Decided on : 17-02-2022
Government Contract – Tender – In the basis of a solitary case, general observations could not have been made by High Court that Indian bidders are being discriminated against – High Court was not deciding a Public Interest Litigation – High Court did not even decide writ petition on merits – Observations made by High Court were absolutely unwarranted – Observations made by High Court in its order dated 19.01.2021, ordered to be expunged/set aside from order passed by High Court. (Paras 3 and 4)
Facts of the case:
Respondent no.1 herein filed writ petition before the High Court of Delhi being Writ Petition No. 5700/2020 assailing the Letter of Acceptance dated 05.06.2020 issued by the Union of India in favour of respondent no.2 herein, in respect of the award of tender. By the impugned order and keeping in view the fact that substantial time has elapsed since the award of the tender in favour of respondent no.2, the High Court declined to interfere in the proceedings and disposed of the writ petition reserving liberty in favour of the original writ petitioner to raise all its pleas and claim the reliefs available to him at this stage in an appropriate civil proceedings.
Finding of Court:
High Courts shall refrain from making sweeping observations which are beyond contours of controversy and/or issues before them.
Result : Appeals Partly allowed.
ORDER
1. Feeling aggrieved and dissatisfied with some of the observations made by the High Court of Delhi at New Delhi in the last paragraph of its order dated 19.01.2021, while disposing of Writ Petition No. 5700/2020, the Union of India has preferred the present appeals.
2. That respondent no.1 herein filed the writ petition before the High Court of Delhi being Writ Petition No. 5700/2020 assailing the Letter of Acceptance dated 05.06.2020 issued by the Union of India in favour of respondent no.2 herein, in respect of the award of tender pertaining to lot No. 3; ICB Ref. No. 21/TCSP/GOODS/P41/2018/TR/TC (Package-41).
2.1 By the impugned order and keeping in view the fact that substantial time has elapsed since the award of the tender in favour of respondent no.2, the High Court declined to interfere in the proceedings and disposed of the writ petition reserving liberty in favour of the original writ petitioner to raise all its pleas and claim the reliefs available to him at this stage in an appropriate civil proceedings. However, while not entertaining the writ petition and/or while disposing of the writ petition, the High Court has made the following observations:
2.2 Feeling aggrieved and dissatisfied with the above observations, the Union of India has preferred the present appeals and has prayed to expunge the said observations/remarks.
3. Having heard Shri Balbir Singh, learned Additional Solicitor General of India, appearing on behalf of the Union of India and Shri Gaurav Juneja, learned counsel appearing on behalf of respondent no.1 herein and having gone through the observations made by the High Court in the last paragraph of its order, made while disposing of the writ petition, reproduced hereinabove, we are of the opinion that the observations made by the High Court, reproduced hereinabove, were absolutely unwarranted. The High Court was not deciding a Public Interest Litigation. The High Court did not even decide the writ petition on merits. On the contrary, in the earlier paragraph, it was observed that it had not gone into the merits of the writ petitioner's claim or the respondent's defence. In such circumstances, such general observations should have been avoided by the High Court and the High Court ought to have restricted itself to the controversy between the parties before it. Even otherwise, on the basis of a solitary case, general observations could not have been made by the High Court that the Indian bidders are being discriminated against. We advise the High Courts not to make general observations which are not warranted in the case. The High Courts shall refrain from making sweeping observations which are beyond the contours of the controversy and/or issues before them.
4. In view of the above, the present appeals succeed in part. The observations made by the High Court in its order dated 19.01.2021, namely,
Courts shall refrain from making sweeping observations which are beyond contours of controversy and/or issues before them.
Arbitrary limitation of approved makes/brands in a tender process can be deemed discriminatory and in violation of government orders, leading to the quashing of the tender process.
Judicial review in tender matters is limited; unsuccessful bidders cannot later challenge tender conditions they participated under.
Tender authorities must adhere to statutory criteria and act transparently; courts will not interfere unless clear evidence of arbitrariness or malafide conduct is presented.
Adherence to the 'Make In India' policy and the impact of violating it on the tender process.
Tender restrictions favoring specific brands violate Articles 14 and 19 of the Constitution, resulting in discriminatory practices and lack of fair competition.
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