No Acts & Articles mentioned in this case
Writ Petition No.25000/2019 1
HIGH COURT OF MADHYA PRADESH, BENCH AT INDOREHIGH COURT OF MADHYA PRADESH, BENCH AT INDORE
DIVISION BENCH : HON’BLE SHRI JUSTICE S. C. SHARMA & HON'BLE SHRIDIVISION BENCH : HON’BLE SHRI JUSTICE S. C. SHARMA & HON'BLE SHRI
JUSTICE SHAILENDRA SHUKLAJUSTICE SHAILENDRA SHUKLA
Writ Petition No.25000/2019
Indermani Mineral (India) Private Limited
v/s
The State of Madhya Pradesh & Two Others
Counsel for the Parties:Shri Arvind Nayar, learned senior counsel
along with Shri Jerry Lopez, learned counsel
for the petitioner.
Shri Shashank Shekhar, learned Advocate
General along with Shri R.S. Chhabra, learned
Additional Advocate General and Shri Vinay
Gandhi, learned Government Advocate for the
respondents / State.
Whether approved for
reporting
:Yes
Law laid down :1. The terms of a tender notice unless or
until they are wholly arbitrary, discriminatory
or actuated by malice are not subjected to
judicial review.
2. The State or its instrumentalities are
required to act reasonably, fair and in public
interest in awarding the contract and the
interference by the High Court is very
restrictive since no person cam claim
Fundamental Right to carry on business with
the Government keeping in view the judgment
delivered in the case of Reliance Telecom
Limited & Others v/s Union of India & Others
reported in 2017 (4) SCC 269. A person or a
company, who has not participated in the a
tender process is not competent to challenge
the tender condition incorporated in the tender.
3. The bid / tender in response to a
Notice Inviting Tender is only a, offer, which
State or its agencies are under no obligation.
The bidders participating in the tender process
cannot insist that their bid should be accepted
simply because a bid is highest or lowest.
Significant paragraph
numbers
:46 to 82
O R D E R
(Delivered on this 6
th
of February, 2020)
(S.C SHARMA)(S.C SHARMA) (SHAILENDRA SHUKAL) (SHAILENDRA SHUKAL)
J U D G E J U D G E J U D G E
Writ Petition No.25000/2019 2
HIGH COURT OF MADHYA PRADESH: BENCH AT INDORE
DIVISION BENCH : HON'BLE SHRI JUSTICE S.C. SHARMA &
HON'BLE SHRI JUSTICE SHAILENDRA SHUKLA
Writ Petition No.25000/2019
Indermani Mineral (India) Private Limited
v/s
The State of Madhya Pradesh & Two Others
Shri Arvind Nayar, learned senior counsel along with Shri
Jerry Lopez, learned counsel for the petitioner.
Shri Shashank Shekhar, learned Advocate General along with
Shri R.S. Chhabra, learned Additional Advocate General and Shri
Vinay Gandhi, learned Government Advocate for the respondents /
State.
O R D E R
(Delivered on this 6
th
day of February, 2020 )
Per : S.C. Sharma, J:
The petitioner before this Court, a Company
registered under the Companies Act, 1956 having Coal
Washeries in different districts of Chhatisgarh, has filed this
present petition being aggrieved by the Notice Inviting
Tender (NIT) issued by the Madhya Pradesh Power
Generating Company Limited inviting bids for ROM Coal
Beneficiation and Managing Associated Logistics for
SSTPP, Khandwa and STPS, Sarni for the year 2019 – 20.
02.It has been stated that earlier two different tenders,
in respect of supply of coal to the Power Generating Plant
i.e. STPS, Sarni and SSTPP, Khandwa for the year 2018 –
19, were floated independently, and now, one common
Writ Petition No.25000/2019 3
tender has been issued for both the Power Generating
Plants for the purposes of coal lifting, beneficiation
(through wet process), liaisoning and movement of coal.
03.The petitioner / Company is aggrieved with certain
terms and conditions of the tender issued by respondent
No.2. During the pendency of the writ petition various
amendments have also been made in the tender (NIT). The
petitioner / Company has challenged the NIT on various
grounds and the main clauses, which are under challenge,
are as under:-
(a)As per Clause – II of the Technical Qualification of the
NIT 2019 – 20, the requisite washing technology required
for the coal beneficiation plant should not be less than 35
Lakh Metric Tonne per annum.
(b)As per Clause – II of the said NIT, a bidder should
possess experience in coal lifting, beneficiation (through
wet process), liaisoning with coal companies and railways
for any State owned Power Generating Companies / NTPC
/ Captive Power Utility of any PSU in India for a total
quantity of not less than 2.8 Million Tonne in span of 12
month from SECL command in last five years.
(c)As per Clause – III (i) of the said NIT, a bidder should
possess turnover (average annual turnover of preceding
three financial years) of Rs.175 crores to showcase his
strong financial ability.
(d)As per Clause – II (I) of the said NIT, a bidder should
possess a spare capacity of the washery not less than 3.5
Metric Tonne per annum.
04.The petitioner / Company has stated in the writ
petition that for the preceding years i.e. for the year 2018 –
19, a separate NIT was issued in respect of Khandwa Power
Writ Petition No.25000/2019 4
Plant and the requirements were that the washing
technology, required for the coal beneficiation plant, should
not be less than 14 Lakh Metric Tonne per annum. It further
provided that the bidder should possess prior experience of
coal lifting, beneficiation (through wet process), liaisoning
and movement of coal by road and railways for one or more
State Power Generating Companies / NTPC / Independent
Power Producers (IPPs) / Steel / Cement / Aluminium
Utilities / PSU's in India (as the case may be) for a total
quantity of not less than 1.40 Million Tonne per annum in
12 months' period in single stretch from SECL commant
area in the last seven years. The Other conditions in respect
of SSTPP, Khandwa NIT for the year 2018 – 19 provided
that a bidder should possess turn over (average annual turn
over of preceding three financial years) of Rs.39.50 crores.
One of the prerequisites was also that a bidder should
further possess a spare capacity of the washery of not less
than 1.40 Metric Tonne per annum.
05.The petitioner / Company has provided comparison
between the NIT, which is subject matter of the dispute and
NIT of the year 2018 – 19 in respect of SSTPP, Khandwa in
form of a chart and the same reads as under:-
Sl.
No.
Technical
Requirement
Clause as amended on
31.03.2018
Tender dated 04.11.2019
1Minimum Bid
Quality
14.00 Lakh Metric
Tonne
35 Lakh per year (both
plants)
2Spare Capacity
of washery
1.40 Metric Tonne per
annum
Clause No.II (i) – 3.5
Metric Tonne per annum
3Past ExperienceThe Intending Bidder
should have executed
the work of coal lifting
beneficiation (through
Clause – II (ii) - Bidder
should have executed the
work of coal lifting
beneficiation (through
Writ Petition No.25000/2019 5
wet process), liaisoning
and movement of coal
by road and railways for
one or more State Power
Generating Companies /
NTPC / Independent
Power Producer (IPPs) /
Steel / Cement /
Aluminium Utilities /
PSUs in India (as the
case may be) for a total
quantity of not less than
1.40 Million Tonne per
annum in 12 months
period in single stretch
from SECL command
area in last 7 years
ending with bid opening
date i.e. 20.02.2018.
wet process), liaisoning
with coal companies and
railways for any State
owned Power Generating
Companies / NTPC /
Captive Power Utility of
any PSU in India for a
total quantity of not less
than 2.8 Million Tonne
in span of 12 monhts
from SECL command in
last 5 years, ending with
bid opening date in case
of consortium, lead
member should meet the
experience criteria.
4Turnover
(average annual
turnover of
preceding three
financial years)
39.50 Cr. Clause – III – 175 Cr.
06.The petitioner / Company, in respect of STPS,
Sarni, has furnished details of the NIT for the year 2018 –
19 and the petitioner’s contention is that in respect of NIT
for STPS, Sarni, the requirements were that the washing
technology required for the coal beneficiation plant should
not be less than 11.00 Lakh Metric Tonne per annum. It has
been further contended by the petitioner / Company that
one of prerequisites was that bidder should possess prior
experience of coal lifting, beneficiation (thourgh wet
process), liaisoning and movement of coal by road and
Railways for one or more State Power Generating
Companies / NTPC / Independent Power Producers (IPPs) /
Steel / Cement / Aluminium Utilities / PSU's in Public
Sector Undertaking in India (as the case may be) for 1.10
Million Tonne per annum in 12 months' period in single
Writ Petition No.25000/2019 6
stretch from SECL command area in the last seven years. It
has been further stated that another prerequisite was that a
bidder should possess turnover (average annual turnover of
preceding three financial years) of Rs.30.74 crores. One of
the prerequisite was also that a bidder should further
possess a spare capacity of the washery of not less than
1.10 Metric Tonne per annum.
07.The petitioner / Company has also furnished a detail
in form of comparative chart in respect of the NIT, which is
impugned in the present writ petition and NIT of the year
2018 – 19 in respect of STPS, Sarni and the chart reads as
under:-
Sl.
No.
Technical
requirement
Clause as amended on
31.03.2018
Tender dated 04.11.2019
1Minimum bid
quantity
11.00 Lakh Metric
Tonne
35 Lakh per year (both
plant)
2Spare capacity
of washery
1.10 Million Tonne per
annum
Clause No.II (i) – 3.5
Metric Tone per annum
3Past experienceThe intending bidder
should have executed
the work of coal lifting
beneficiation (through
wet process), liaisoning
and movement of coal
by road and railways
for one or more State
Power Generating
Companies / NTPC /
Independent Power
Producers (IPPs) / Steel
/ Cement / Aluminium
Utilities / PSU's in
India (as the case may
be) for a total quantity
of not less than 1.10
Million Tonne per
annum in 12 months'
period in single stretch
from SECL command
area in last 7 years,
ending with bid
Clause No.II (i) – Bidder
should have executed the
work of coal lifting,
beneficiation (through
wet process), liaisoning
with coal companies for
any State owned Power
Generating Companies /
NTPC / Captive Power
Utility of any PSU in
India for a total quantity
of not less than 2.8
Million Tonne in span of
12 months from SECL
command in last five
years, edning with bid
opening date. In case of
consortium, lead member
should meet the
experience criteria.
Writ Petition No.25000/2019 7
opening date i.e.
20.02.2018.
4Turnover
(average annual
turnover of
preceding three
financial years)
30.74 Cr. 175 Cr.
08.The petitioner’s contention is that the NIT, which
has been issued, is a tailor-made NIT and has been floated
with a malafide intent to cheat the honest bidders and to
avoid bonafide competition and also to cause heavy loss to
the State Exchequer by modifying and personalising the
the tender conditions. The petitioner’s contention is that
impugned unreasonable and arbitrary change in the terms
and conditions of the impugned NIT dated 02.11.2019 are
in contravention to the settled law and practice, which in
turn defeats the competitive spirit of bidding, which is the
object behind issuing the public NIT. The petitioner has
challenged the NIT on various grounds and the main
contention of the petitioner is that it is a tailor-made NIT
eliminating large number of bidders with an oblique and
ulterior motive.
09.The petitioner has also raised a ground that as per
Clause – II of the Technical Qualification, a condition has
been imposed and the same requires that washing
technology required for the coal beneficiation plant should
not be less than 35 Lakh Metric Tonne per annum.
ascompared to the preceding NIT year, which requires a
capacity of 14 Lakh Metric Tonne per annum in SSTPP,
Khandwa and 11.00 Lakh Metric Tonne per annum in
STPS, Sarni. The aforesaid shift, in capacity, is more than
Writ Petition No.25000/2019 8
the double as required under the previous NIT without any
rhyme and reason and is against the nature of fair
contractual terms as contended by the petitioner.
10.The petitioner has further contended that as per
Clause – II (ii) of the said NIT, it is provided that a bidder
should possess experience in coal lifting, beneficiation
(through wet process), liaisoning with coal companies and
railways for any State Owned Power Generating
Companies / NTPC / Captive Power Utility of any PSU in
Public Sector Undertaking in India for a total quantity of
not less than 2.8 Million Tonne in span of 12 months from
SECL command in last five years, which is exorbitantly
high as compared to the NIT issued in the preceding year
for which coal lifting, beneficiation (through wet process),
liaisoning and movement of coal by road and railways for
one or more State Power Generating Companies / NTPC/
Independent Power Producers (IPPs) / Steel / Cement /
Aluminium Utilities / PSU's in the Public Sector
Undertaking in India (as the case may be) for a total
quantity of not less than 1.40 Million Tonne per annum in
12 months' period in single stretch from SECL command
area in last 7 years in SSTPP, Khandwa and 1.10 Million
Tonne per annum in 12 months' period in single stretch
from SECL command area in last 7 years in STPS, Sarni
was required.
11.It has further been contended that the work
experience being a decisive factor in a bid process wherein
the experience of the Independent Power Producers was
included in the preceding year, which got subsequently,
Writ Petition No.25000/2019 9
being a reasonable litmus test, has been removed with a
malafide intention to favour few companies in the bidding
process. The aforesaid changes have been incorporated with
a malice intent to avoid the bonafide competition and to
favour few individuals.
12.The petitioner has further contended that as per
Clause – III (i) of the said NIT, the requirement is that a
bidder should possess turnover (average annual turnover of
preceding three financial years) of Rs.175 crores, which is
thrice the amount as compared to the preceding NIT, which
required an annual turnover of Rs.39.50 crore in SSTPP,
Khandwa and Rs.30.74 crores in STPS, Sarni. The
aforesaid amounts to exorbitant increase and cannot be
shadowed under the garb of reasonable hike and is an
unfair contractual term in the eyes of law.
13.It has further been contended that as per Clause – II
(i) of the said NIT, a condition has been imposed that a
bidder should possess a spare capacity of the washery not
less than 3.5 Metric Tonne per annum as compared to the
preceding NIT of 1.40 Metric Tonne per annum in SSTPP,
Khandwa and 1.10 Metric Tonne per annum in STPS,
Sarni. The spare capacity is increased to an extent whereby
the companies like the petitioner and the similar situated
companies have no scope to comply with and has been
hiked so exorbitantly to avoid the fair bidding process and
is against the basic structure of the contractual law.
14.The petitioner has contended that the exorbitant
hike in various terms and conditions of the NIT as
compared to the preceding year is very well within the garb
Writ Petition No.25000/2019 10
of unfair contractual terms and is liable to be set aside.
15.It has been contended that it is, apparently and
unequivocally, clear upon a bare perusal of the terms and
conditions of the NIT that the same have been incorporated
in collusion with a handful of individual / corporate with a
sole view to favour these handful of individuals / corporate,
thereby encouraging cartelization. The petitioner has
contended that the aforesaid onerous terms and conditions
of the NIT, which have encouraged cartelization in favour
of a handful of individual / corporate lies in the teeth of fair
bidding process and providing a 'level playing field' to all
bidders and the petitioner’s contention is that the aforesaid
change in the terms and conditions of the present NIT with
that of the preceding NIT only portrays the reason to avoid
the fair bidding process and is arbitrary in nature and is
liable to be set aside.
16.It has been contended that the present NIT has been
floated with a malafide intent to cheat the honest bidders
and to avoid the bonafide competition and cause heavy loss
to the State Exchequer by modifying and personalising the
tender conditions so as to only suit or make eligible a
handful of individual / corporate and is liable to be set
aside.
17.The petitioner has placed reliance upon a judgment
delivered in the case of Caterpillar India (P) Limited v/s
Western Coalfields Limited & Others reported in (2007)
11 SCC 32. Reliance has also been placed upon a judgment
delivered in the case of Reliance Energy Limited &
Another v/s Maharashtra State Road Development
Writ Petition No.25000/2019 11
Corporation Limited & Others reported in (2007) 8 SCC 1.
18.The petitioner has prayed for the following reliefs:-
(i)That, this Hon'ble Court may kindly be pleased to
quash the NIT dated 02.11.2019 (Annexure-P/3) issued by
respondent No.2.
(ii)Respondents may kindly be directed to issue fresh NIT
with just and fair conditions as were prevalent in past NITs
and in consonance with judicial pronouncement.
(iii)Any other relief / reliefs order / orders, direction /
directions which this Hon'ble Court may deems feet and
proper may kindly be granted to the petitioner.
19.The respondents have filed a reply in the matter and
it has been stated that the respondent No.2 is a Company
Limited by share and owned and controlled by the
Government of Madhya Pradesh. It has been stated that the
as per the norms of the the Ministry of Environment &
Forest, Government of India, the coal containing more than
34% of ash cannot be supplied to Power Plants exceeding
500 km unless it is routed through washery circuit to reduce
the ash content. The distance from SECL, mines to SSTPP-
1, SSTPP-II & STPS is more than 500 km and the ROM
coal supplied to these power houses generally contains
more than 34% ash, which required coal beneficiation.
This coal beneficiation is mandatory for the coal being used
at these Thermal Power Stations to reduce ash content up to
or below 34%. Since, the SECL has no washery unit in the
mine area, tenders are being invited from the nearby private
washery operators located in SECL area for the work of
ROM Coal beneficiation along with its associated logistics
for reduction in ash content for compliance of MOEF
Writ Petition No.25000/2019 12
norms. The contention of the respondents is that the
impugned tender dated 02.11.2019 is an outcome of the
aforesaid requirement.
20.The respondents have stated that petitioner’s main
challenge to the NIT is on the basis of alleged tailor-made
conditions to favour certain persons. The respondents have
stated that the prerogative to determine the minimum
'Technical and Financial Criteria for Qualification' in any
particular NIT lies exclusively in the hands of the tendering
authority and the tendering authority is the best judge to
ensure bidders' capacity, capability and resource to execute
the work and cannot compromise with the pre-qualification
requirement, which is best suited to the interest of the
tendering authority as generation of electricity requires
regular and uninterrupted supply of coal in the instant
tender. In respect of the aforesaid contention, the
respondents have placed reliance upon the judgments
delivered in the cases of Larsen & Toubro Limited v/s
Gujarat State Petroleum reported in (2000) 2 GLR 1814,
Air India Limited v/s Cochin International Airport
Limited reported in (2016) 16 SCC 818 and Eurasian
Equipment & Chemicals Limited v/s The State of West
Bengal reported in (1975) 1 SCC 70.
21.It has been further contended by the respondents
that in the preceding year 2018 – 19, individual tender of
alike nature for SSTPP-I, Khandwa only, was issued by the
respondents wherein the tendered quantity was only 28.269
Lakh Metric Tonne and the period of work was only for one
year. Whereas, in the instant impugned tender dated
Writ Petition No.25000/2019 13
02.11.2019, the tendered quantity has been raised from
28.269 Lakh Metric Tonne to 280 Lakh Metric Tonne,
which is ten times of the earlier one and for a period of four
years in total. The respondents have stated that the earlier
NIT for the year 2018 – 19 invited e-tenders from reputed
established Washery Operators only for one Power Plant
i.e. SSTPP-I, Khandwa, whereas, the instant NIT has been
called for three Power Plants altogether i.e. SSTPP-I,
SSTPP-II and STPS, Sarni. The said amalgamation has
been done looking into various peculiarities and certain
problems as well to ensure regular, unhindered supplies by
the prospective bidders, who can assure and guarantee the
same, based on the prerequisite as published in Tender
Notice. Therefore, in order to provide an effective set up to
deal with the same, the instant amalgamation has been
done. The decision of amalgamating the projects and to call
under the single NIT has been taken on the basis of past
experience and difficulties faced by the respondents which
are as under:-
1.Previously, each power house issued separate tenders
with required separate publication and tendering process.
The said tasks were to be taken up individually by an
evaluation team which ultimately resulted in additional
expenditure and cost which was to be borne by the
tenderer out of and from the State Exchequer.
2.Previously, dealing with number of cases of a
respective in nature, had an additional financial impact and
as well as nature as well as it lacked to wastage of valuable
resources such as manpower and time. Since similar nature
of work was required to be carried out repetitively.
3.Separate tenders resulted in prevalence of different
Writ Petition No.25000/2019 14
rates with wide variation. This resulted into discrepancies
and casted shadows of doubt upon the tenderers.
22.The respondents have further stated that the
petitioner has further levelled allegation in the Writ Petition
alleging that the prequalifying criteria, which was basically
incorporated to assess the technical and Financial capability
of bidder, is tailor-made in order to benefit certain blue
eyed tenderers and to eliminate genuine and bonafide
tenderers such as the petitioner. In this regard, the
respondents have stated that the technical qualification and
financial qualification fall under the head of
prequalification requirements prescribed in the tender,
which consists of primarily five major components i.e. first
is Requisite Washing Technology / Spare Capacity of
Washery; second is Requisite Past Experience for Bidder;
third is Arrangement of Railway Siding for Transportation
of Coal; fourth is Location of Washery and fifth is
Requisite documents to be submitted by the bidder.
23.In respect of contract period, the respondents have
stated that it was the need of the hour to extend the contract
period. Such a need has arisen on account of the following
factors:-
(i)Availability of coal varies as per the production of
SECL. It has been the experience of the answering
respondents that if coal production or availability suddenly
increased then contractors failed to lift coal due to non-
availability of sufficient infrastructure like fleet, spare
washing capacity etc.
(ii)During discussions and conferences with bidders, who
have been previously engaged and with those who are
interested, suggestions have come up that if long term
Writ Petition No.25000/2019 15
associations are made with them on account of long term
contracts, they can develop sufficient infrastructure to
serve the organization in a better way to fulfill its
requirement.
(iii)The long term associations, on account of long
term contracts, are more sustainable, viable and beneficial
to the interest of the answering respondents ans as well as
to the interest of contractors.
(iv)Other power utilities like Maharashtra State
Mining Department (For Mahagenco), GSECL & RVUNL
are also issuing tenders with contract period of more than
one year i.e. from 2 – 5 years.
24.In respect of the financial criteria incorporated in
the NIT, the respondents have stated that it is the standard
practice of the respondents to keep the turnover criteria
variable as per the estimated cost of the Tender. It has been
stated that in the previous tenders for SSTPP-I and STPS,
Sarni, where tendered quantities were 28.269 and 21.67
Lakh Metric Tonne respectively for one year, the financial
capability (average annual turnover) of bidders were kept as
39.5 crore and 44 crore (total 83.5 crore). Whereas, in the
instant tender, where the contract is for a period of four
years with tendered quantity of 280 Lakh Metric Tonne (@
70 Lakh Metric Tonne per year) for three power houses i.e.
SSTPP-I, SSTPP-II and STPS, Sarni, the average annual
turnover of the bidder for the preceding three financial
years is kept as Rs.175 crore. The respondents have
mentioned that if the earlier practice for determining the
financial criteria would have been taken into account for
the proportionate quantity then the average annual turnover
required in the instant tender, would have been Rs.470
Writ Petition No.25000/2019 16
crores. Whereas, in order to provide relaxation and invite
maximum bidders and to keep the healthy competition and
to provide level playing field, the criteria has been reduced
to Rs.175 crores (i.e. less than 40%) and also to ensure
sufficient experience and capabilities of the prospective
bidders to meet out the requirement of the tender work, and
therefore, the stand of the petitioner is false and baseless.
25.In respect of not taking into account the work
experience done with independent power producers, which
was earlier in existence in previous tender, the respondents
have stated that in the previous tender, the experience of
Independent Power Plant / Steel / Cement / Aluminium
Companies have also been considered. The respondents
have further contended that placing reliance on aforesaid,
the petitioner has alleged that leaving out / discarding the
experience of work done in IPPs is a tailor-made condition
incorporated to suit the interest of certain blue eyed
persons. In this regard, the respondents have stated that
leaving out / discarding the experience of IPPs in the
instant tender for calculating the work experience is an
outcome of deliberation, consideration and application of
mind in considering the past experience of the respondents
in dealing with with the contractors whose work experience
was in IPPs. The respondents have brought to the notice of
this Court that earlier they issued a tender for Road-cum-
Rail Transport (RCR) of coal bearing No.MPPGCL /
EDFM / NCL / TS / 72 / 9471 / 2018 wherein, experience
of IPP was considered. However, a lot of difficulties were
faced in corroboration of credential of one of the bidders
Writ Petition No.25000/2019 17
due to misleading information provided by the IPP. The
respondents have also stated that in the year 2019, various
tenders have been issued following this bad experience and
having learnt the said lesson.
26.The respondents have further contended that the
exclusion of consideration of experience of work done in
respect of Independent Power Producer (IPP) cannot be
said to be an essential condition of the contract. Work
experience is a criteria, which is necessary to arrive to a
satisfaction that the contractor / bidder has undertaken work
of similar nature previously and has successfully completed
the same. Such credential of a contractor / bidder at the
stage of technical evaluation of the bid needs to be verified
from the authority who has provided him with the work
experience certificate. The respondents have stated that so
far as IPPs are concerned, the verification of work
performed in an IPP can be quite deceptive and depends
solely on the information provided by the IPP. The veracity
and authenticity of the information provided by the IPP is
solely based upon the information supplied by IPP and is
very difficult to be cross checked. Thus, the decision taken
by the respondents, in order to eliminate / discard the work
experience of an IPP, is a well reasoned decision on
account of due deliberation and consideration of their past
experiences.
27.The respondents have further contended that the
pre-qualification requirement as per the Tender provides for
certain technical qualifications as well as Financial
Qualifications which are essential or mandatory
Writ Petition No.25000/2019 18
requirements in terms of the dictum of the Supreme Court
in Poddar Steel Corporation v/s Ganesh Engineering
Works & Another reported in 1991 AIR 1579, wherein a
distinction has been made regarding essential and non-
essential conditions existing in the pre-qualification
requirement. So far as the non-essential conditions are
concerned, the said conditions can be done away with while
awarding the contract to any bidder but, the essential
conditions are sine qua non and they cannot be dispensed
with at any cost. The respondents have stated that
allegation of the petitioner with regard to the tender
conditions as tailor-made are only in respect of the essential
conditions and hence, in view of the dictum of the Hon'ble
Supreme Court, it is evident that such conditions cannot be
dispensed with. In view of the said submissions, the
respondents have stated that the stand taken by the
petitioner cannot be sustained.
28.In respect of the representation submitted by the
petitioner to Additional Chief Secretary, Energy, the
respondents have stated that the representation submitted
by the petitioner is merely an eyewash and no time was
given to the respondents for considering the grievances
raised by the petitioner and without waiting for the reply,
the present petition has been filed. It has also been stated
that the corrigendum was issued on 21.11.2019, however,
the corrigendum does not permit the persons, who were
having experience with Independent Power Producer.
29.The respondents have further stated that the scope
of scrutiny with regard to terms of the invitation to tender is
Writ Petition No.25000/2019 19
in the realm of contract and the decision to accept the
tender or award the contract is reached through several tiers
and such decisions are made qualitatively by experts. They
have stated that the terms of invitation to tender cannot be
opened to judicial scrutiny.
30.In support of the aforesaid contention, the
respondents have placed reliance upon the judgments
delivered in the cases of Meerut Development Authority
v/s Association of Management Studies & Others reported
in (2009) 6 SCC 178, Michigan Rubber (India) Limited
v/s The State of Karnataka & Others reported in (2012) 8
SCC 216, Assn. of Registration Plates v/s Union of India
reported in (2005) 1 SCC 679, Union of India v/s
Hindustan Development Corporation reported in (1993) 3
SCC 499, Tata Cellular v/s Union of India reported in
(1994) 6 SCC 651 and Maa Binda Express Carrier &
Another v/s North Eastern Frontier Railway & Others
reported in (2014) 3 SCC 760 and they have stated that the
only criteria, which can warrant interference of this Court is
the presence of arbitrariness, unreasonableness and absence
of fair play, which in the instant case, is not at all present
and as such, the terms and conditions of the tender, which
has been issued by the respondents, are not open for
judicial scrutiny, and therefore, the petition filed by the
petitioner deserves to be dismissed.
31.The respondents have stated that in the cases of
Meerut Development Authority (supra) and Michigan
Rubber (India) Limited (supra), it has been held that the
terms of invitation of tender cannot be opened for judicial
Writ Petition No.25000/2019 20
scrutiny because the invitation of tender is in the realm of
contract which favours only the respondents.
32.The respondents have further stated that placing
reliance upon a judgment delivered in the case of Tata
Cellular (supra), it has been held in Para-46 of the
judgment delivered in the case of Municipal Corporation,
Ujjain & Another v/s Bvg India Limited & Others
reported in (2018) 5 SCC 462 that the terms and conditions
of the tender are not open to judicial scrutiny as the
invitation to tender is a matter of contract.
33.The respondents have further stated that in the
judgment delivered in the case Monarch Infrastructure
(P) Limited v/s Commissioner, Ulhasnagar Municipal
Corporation & Another reported in (2002) 5 SCC 287, the
Hon'ble Apex Court has held that judicial review in the
matter of Tenders is limited to the same if found
discriminatory in nature between similarly situated persons
and is arbitrary and restriction of Courts in interfering in
the matters of administrative action or changes made
therein unless the same is arbitrary of discriminatory. It has
been stated that present case is a case where, there is no
substance in the allegations which can demonstrate any
discriminatory or arbitrary action and mere allegation as
such, is of no assistance to the petitioner.
34.The respondents have further stated that in the case
of Directorate of Education & Others vs Educomp
Datamatics Ltd. & Others reported in (2004) 4 SCC 19, it
has been held by the Hon'ble Apex Court that the terms of
initiation of tender are not open to judicial scrutiny. It has
Writ Petition No.25000/2019 21
been held that Government must have a free hand in setting
the terms of the tender. It must have reasonable play in its
joints as a necessary concomitant for an administrative
body in an administrative sphere. It has further been
observed that the Court can scrutinize the award of the
contracts by the Government or its agencies in exercise of
their powers of judicial review to prevent arbitrariness or
favourtism. It is entitled to pragmatic adjustments which
may be called for by the particular circumstances. The
Apex Court has further observed that the Courts cannot
strike down the terms of the tender prescribed by the
Government because it feels that some other terms in the
tender would have been fair, wiser or logical.
35.The respondents have further stated that in the case
of Air India Limited (supra), the Apex Court has held that
the award of a contract, whether it is by a private party or
by a public body or the State, is essentially a commercial
transaction. In arriving at a commercial decision
considerations, which are of paramount, are commercial
considerations. The State can choose its own method to
arrive at a decision. It can fix its own terms of invitation to
tender and that is not open to judicial scrutiny. It can enter
into negotiations before finally deciding to accept one of
the offers made to it. Price need not always be the sole
criterion for awarding a contract. It is free to grant any
relaxation, for bonafide reasons, if the tender conditions
permit such a relaxation. It may not accept the offer even
though it happens to be the highest or the lowest. But the
State, its corporations, instrumentalities and agencies are
Writ Petition No.25000/2019 22
bound to adhere to the norms, standards and procedures
laid down by them and cannot depart from them arbitrarily.
Though that decision is not amenable to judicial review, the
Court can examine the decision making process and
interfere, if it is found vitiated by malafides,
unreasonableness and arbitrariness.
36.The respondents have further stated that in the case
of G.J. Fernandez v/s State of Karnataka & Others
reported in (1990) 2 SCC 488, it was reaffirmed that the
party issuing the tender (the employer) has the right to
punctiliously and rigidly enforce the terms of the tender. If
a party approaches a Court for an order restraining the
employer from strict enforcement of the terms of the
tender, the Court would decline to do so. It was also
reaffirmed that the employer could deviate from the terms
and conditions of the tender if the change effected all
intending applicants alike and were not objectionable.
Therefore, deviation from the terms and conditions is
permissible so long as the level playing field is maintained
and it does not result in any arbitrariness or discrimination
in the Ramana Dayaram Sheety sense.
37.The respondents have stated that the Hon'ble Apex
Court in the case of M/s Master Marine Services (P)
Limited v/s Metalfe & Hodgkinson (P) Limited & Another
reported in (2005) 6 SCC 138, has reiterated the principles
that (a) State can choose its own method to arrive at a
decision; (b) the State, its corporations, instrumentalities
and agencies have the public duty to be fair to all
concerned; (c) even when some defect is found in decision
Writ Petition No.25000/2019 23
making process, Court must exercise its extraordinary writ
jurisdiction with great caution and that too in furtherance of
public interest; and (d) larger public interest is passing an
order of intervention is always a relevant consideration.
38.The respondents have stated that if the State or its
instrumentalities act reasonably, fair and in public interest
in awarding the contract, the interference by the this Court
is very restrictive since no person can claim Fundamental
Right to carry on business with the Government. They have
stated that principles stand reiterated in the cases of
Haryana Urban Development Authority & Others v/s
Orchid Infrastructure Developers Private Limited
reported in (2017) 4 SCC 243 and Reliance Telecom
Limited & Another v/s Union of India & Another
reported in (2017) 4 SCC 269.
39.The respondents have stated that reasonableness of
a restriction is to be determined in an objective manner and
from the stand point of interests of the general public and
not from the stand point of the interest of person upon
whom the restrictions have been imposed or upon abstract
consideration. A restriction cannot be said to be
unreasonable, merely because, in a given case, it operates
harshly, in determining, whether there is any unfairness
involved; the nature of the right alleged to have been
infringed the underlying purpose of the restriction imposed,
the extent and urgency of the evil sought to be remedied
thereby, the disproportion of the imposition and the
prevailing condition at the relevant time, enter into judicial
verdict. Canalization of a particular business in favour of
Writ Petition No.25000/2019 24
even a specified individual is reasonable where the interests
of the country are concerned or where the business affects
the economy of the country. In this regard, the respondents
have placed reliance upon judgments delivered in the cases
of Shree Meenakshi Mills Limited v/s Union of India
reported in 1974 AIR 366, Hari Chand Sarda v/s Mizo
District Council reported in (1967) 1 SCR 1012 and
Krishnan Kakkanth v/s Government of Kerela reported in
(1997) 9 SCC 495.
40.The respondents have further stated that in the case
of Global Energy Limited & Another v/s Adani Exports
Limited & Others reported in (2005) 4 SCC 435, it has
been held that unless terms of a tender notice are wholly
arbitrary, discriminatory or actuated by malice are not
subjected to judicial review. It was observed that the
principle is, therefore, well settled that the terms of the
invitation to tender are not open to judicial scrutiny and the
Courts cannot whittle down the terms of the tender as they
are in the realm of contract unless they are wholly arbitrary,
discriminatory or actuated by malice. This being the
position of law, settled by a catena of decisions of this
Court, it is rather surprising that the learned Single Judge
passed an interim direction on the very first day of
admission hearing of the writ petition and allowed the
appellants to deposit the earnest money by furnishing a
bank guarantee or a bankers' cheque till three days after the
actual date of opening of the tender. The order of the
learned Single Judge being wholly illegal, was, therefore,
rightly set aside by the Division Bench.
Writ Petition No.25000/2019 25
41.A rejoinder has also been filed by the petitioner in
the matter and it has been stated that the tailor-made NIT
deserves to be quashed in light of the Judgment delivered
by this Court in the case of Caterpillar India Private
Limited (supra). Reliance has also been place upon a
judgment delivered in the case of Reliance Energy Limited
& Another v/s Maharashtra State Road Development
Corporation Limited & Others reported in (2007) 8 SCC 1
and a prayer has been made for quashment of terms and
conditions of the NIT which is under challenge.
42.The respondents have placed reliance upon a
judgment delivered in the case of National Highway
Authority of India v/s Gwalior Jhansi Expressway
Limited reported in (2018) 8 SCC 243 and the contention
of learned Advocate General is that keeping in view the
judgment delivered by the Hon'ble Supreme Court, a
company, who never chose to participate in a particular
tender, cannot challenge the tender conditions incorporated
in the tender.
43.Reliance has also been placed upon a judgment
delivered in the case of Meerut Development Authority v/s
Association of Management Studies reported in 2009 (6)
SCC 171 and the contention of the learned Advocate
General is that in case, there is no vagueness, uncertainty or
confusion with regard to reserved prices, there is no scope
for judicial review.
44.The respondents have placed reliance upon a
judgment delivered in the case of Michigan Rubber
(India) Limited v/s The State of Karnataka & Others
Writ Petition No.25000/2019 26
reported in 2012 (8) SCC 216 and it has been argued before
this Court that scope of interference by Courts is quite
restricted and no person can claim Fundamental Right to
carry on business with the Government.
45.Heard learned counsel for the parties at length and
perused the record.
46.The undisputed facts reveal that the petitioner /
Company is aggrieved by the certain terms and conditions
of the NIT dated 02.11.2019 (Annexure-P/3), Tender
ID.2019_MPPGC_61325_1 issued by the Madhya Pradesh
Power Generating Company Limited. The petitioner /
Company has challenged the following clauses of the NIT:-
(a)As per Clause – II of the Technical Qualification of the
NIT 2019 – 20, the requisite washing technology required
for the coal beneficiation plant should not be less than 35
Lakh Metric Tonne per annum.
(b)As per Clause – II of the said NIT, a bidder should
possess experience in coal lifting, beneficiation (through
wet process), liaisoning with coal companies and railways
for any State owned Power Generating Companies / NTPC
/ Captive Power Utility of any PSU in India for a total
quantity of not less than 2.8 Million Tonne in span of 12
month from SECL command in last five years.
(c)As per Clause – III (i) of the said NIT, a bidder should
possess turnover (average annual turnover of preceding
three financial years) of Rs.175 crores to showcase his
strong financial ability.
(d)As per Clause – II (I) of the said NIT, a bidder should
possess a spare capacity of the washery not less than 3.5
Metric Tonne per annum.
47.Learned senior counsel for the petitioner has argued
Writ Petition No.25000/2019 27
before this Court that in order to favour blue eyed persons
tailor-made tender conditions have been inserted in the
contract. The work experience in respect of Independent
Power Producers has been deleted in the impugned NIT
whereas, the same was in existence since time immemorial
and for the first time, the condition of work experience in
respect of Independent Power Producers has been deleted.
It has also been argued that keeping in view the
privatization and modernization of power projects, large
number of Independent Power Producers have established
their power plant and the persons like the petitioner are
carrying out similar kind of work with the Independent
Power Producers, and therefore, deletion of work
experience criteria with Independent Power Producer is an
arbitrary decision on the part of the respondents.
48.Learned senior counsel has also argued that earlier
experience of Independent Power Plant, Steel Plant,
Cement / Aluminium Companies were also considered. He
has further argued that in case, the aforesaid condition is
not declared to be an arbitrary condition, a person in whose
favour the contract is awarded by a government owned
company, will be receiving the work in perpetuity because
a person, who does not have experience to work with the
Government or with the Public Sector Undertaking will
never be able to enter in the field to gain experience with
Government Sector and Public Sector Undertaking. He has
also argued that certain blue eyed persons were invited by
respondent No.2 and after discussing the matter of contract,
and terms and conditions to be formulated with those
Writ Petition No.25000/2019 28
persons, tailor-made conditions have been made in respect
of quantity of work experience and in respect of period of
work.
49.Learned senior counsel has drawn the attention of
this Court towards the return filed by the respondents and
paragraph – 13 of the return, which is duly supported by an
affidavit reads as under:-
13.That, if contract period is taken into account, it was the
need of the hour to extend the contract period. Such need
has arisen on account of the following factors:-
(i) Availability of coal varies as per the
production of SECL. It has been the experience of
the answering respondents that if coal production
or availability suddenly increased then contractors
failed to lift coal due to non-availability of
sufficient infrastructure like fleet, spare washing
capacity etc.
(ii)During discussions and conferences
with bidders, who have been previously engaged
and with those who are interested, suggestions
have come up that if long term associations are
made with them on account of long term
contracts, they can develop sufficient
infrastructure to serve the organization in a better
way to fulfill its requirement.
(iii)The long term associations, on account
of long term contracts, are more sustainable,
viable and beneficial to the interest of the
answering respondents ans as well as to the
interest of contractors.
(iv)Other power utilities like Maharashtra
State Mining Department (For Mahagenco),
GSECL & RVUNL are also issuing tenders with
contract period of more than one year i.e. from 2 –
5 years.”
50.The return which is filed along with an affidavit of
a Senior Officer of MPPGCL reflects that bidders, who
were previously engaged with respondent No.2, were
called, deliberations were made and then terms and
conditions of contract were decided. This process of calling
bidders to frame terms and conditions is unheard of. In all
Writ Petition No.25000/2019 29
fairness, the respondents should have issued a public notice
inviting all interested parties to give their suggestions,
however, the action appears to be an action taken in a close
room with certain individuals.
51.This Court does not approve such an action taken
by respondent No.2 of discussion and conferences with
elimination of other players of the field, however, the
conditions in the contract are required to be looked into
independently on merits to find out whether they are
arbitrary, illegal or actuated with malafide.
52.The first ground raised by the petitioner / Company
is that the tender has been issued in respect of two power
plants namely SSTPP, Khandwa and STPS, Sarni in the
year 2019 – 20, whereas earlier in the year 2019 – 20,
separate tenders were issued for two power plants. It is
again an undisputed fact that both the power plants are
owned and controlled by the State of Madhya Pradesh and
they are being managed by the Madhya Pradesh Power
Generating Company Limited. One tender for two power
plants can always be issued and the decision of the State
Government, by no stretch of imagination, can be treated as
wholly arbitrary, discriminatory or actuated by malice,
hence, the decision of the State Government on this ground
cannot be subjected to judicial review.
53.The second ground raised by the petitioner is in
respect of qualification as provided under Clause – II,
which provides that the requisite washing technology
required for coal benificiation plan will not be less than
35.00 Lakh Metric Tonne per annum. The petitioner has
Writ Petition No.25000/2019 30
given a comparative statement in the same condition for the
year 2018 – 19 in respect of two power plants and its
contention is that in respect of SSTPP, Khandwa it was
earlier 14.00 Lakh Metric Tonne per annum and in respect
of STPS, Sarni, it was 11.00 Lakh Metric Tonne. The
respondents have now issued a tender for both the power
plants and have provided the capacity to be 35.00 Lakh
Metirc Tonne, and therefore, in the considered opinion of
this Court, the technical qualification prescribed, as it is for
two power plants of 35.00 Lakh Metric Tonne, can again be
never said to e an arbitrary condition.
54.In respect of requisite past experience, keeping in
view the fact that the supply of coal is being made to two
power plants, it has been provided that the intending bidder
should have executed the work of coal lifting beneficiation
(through wet process), liaisoning and movement of coal by
road and railways for any State owned Power Generating
Company / NTPC / Captive Power Utlities of any Public
Sector Undertaking in India for a total quantity of not less
than 28 Lakh Metric Tonne in span of 12 months for SECL
command area in last five years.
55.In respect of the aforesaid condition, the
respondents have stated that the aforesaid tender conditions
has been inserted in the tender after great discussions and
deliberations to ensure regular supply of coal to power
plants and the condition of having experience of supply of
coal with State owned Power Generating Company / NTPC
/ Captive Power Utilities of any Public Sector Undertaking
can never be termed as unreasonable condition. The
Writ Petition No.25000/2019 31
respondent No.2, being an instrumentality of State, has to
protect the interest of the State and if in the tender a
condition has been imposed in respect of past experience
with the Government or Government owned company or
Public Sector Undertakings, it can never be termed as
arbitrary condition.
56.The petitioner has also raised a ground in respect of
the contract period. In the present case, the contract period
is of four years and it is for supply of 280 Lakh Million
Tonne i.e. 70.00 Lakh Million Tonne per year.
57.The respondents have stated that other power
utilities like Maharashtra State Mining Department,
SGECL & RVUNL have also issued tender with contract
period of more than one year ranging 2 to 5 year.
58.The tenure of contract depends upon the nature of
work and in the present case, supply of coal is the subject
matter of the contract, which is required constantly for
power generation. The process of tender consumes 3 to 4
months and at times, it is delayed also, and therefore, in
order to ensure that same exercise is not carried out every
year, the respondents have arrived at a conclusion to award
the work to successful bidder for a period of four years.
Fixing a time period in a contract can never be again an
arbitrary condition.
59.Much has been argued on the issue of exclusion of
parties, who have done work with Independent Power
Producer (private company). The present case is not a case
where the respondents have inserted a tender condition,
which provides that a contractor should have work
Writ Petition No.25000/2019 32
experience only with Power Generating Company owned
by the State of Madhya Pradesh. The bidder, if he is having
experience in respect of supply of coal for any State owned
Power Generating Company / NTPC / Captive Power
Utilities of any Public Sector Undertaking in India is
eligible to participate. The aforesaid condition, in no way,
be illegal and arbitrary condition as argued.
60.Keeping in view the facts and circumstances of the
case, it can never be said that the tender conditions are
tailor-made and they have been framed with a malafide
intention to avoid bonafide condition and to favour few
individual. The copies of various tenders issued by the
electricity companies of Maharashtra and Gujarat are also
on record as Annexure-R/2. They are also having similar
conditions in respect of similar tenders and the petitioner
has not been able to establish before this Court that the NIT
has been floated with a malafide intention and to cause
heavy loss to the State Exchequer merely because
conditions are not favourable to the petitioner, they cannot
be termed as arbitrary conditions.
61.The scope of judicial scrutiny has been considered by
the Hon'ble Apex Court time and again. In the case of
Afcons Infrastructure Limited v/s Nagpur Metro Rail
Corporation Limited reported in 2016 (16) SCC 818, the
Apex Court has held as under:-
“We may add the owner or the employer of a
project, having authored the tender documents, is the
best persons to understand and appreciate its
requirements and interpret its documents. The
constitutional Courts must defer to this understanding
and appreciation of the tender documents, unless there
a malafide or perversity in the understanding or
Writ Petition No.25000/2019 33
appreciation or in the application of the terms of the
tender conditions. It is possible that the owner of
employer of a project may give an interpretation to the
tender documents that is no acceptable to the
constitutional Courts but that by itself is not a reason
for interfering with the interpretation given”.
62.The Apex Court in the case of Reliance Telecom
Limited & Others v/s Union of India & Others reported in
2017 (4) SCC 269 has again dealt with scope of
interference in respect of the tender.
63.In the case of Tata Cellular v/s Union of India
reported in 1994 (6) SCC 651 again the scope of judicial
review has been looked into by the Hon'ble Apex Court. In
the aforesaid case, it has been held that the terms of the
invitation to tender cannot be open to judicial scrutiny
because the invitation to tender is in the realm of contract
and the Government must be allowed to have a fair play in
the joints as it is a necessary concomitant for an
administrative body functioning in an administrative sphere
or quasi-administrative sphere.
64.The Apex Court in the case of Monarch
Infrastructure (P) Limited v/s Ulhasnagar Municipal
Corporation & Others reported in 2000 (5) SCC 287 was
again dealing with the N.I.T. and it has been held that it
cannot say whether the conditions are better than what were
prescribed earlier, for in such matters, the authority calling
the tenders is the best judge. The Court declined to restore
status quo ante.
65.In the case of Cellular Operator Association of India
& Others v/s Union of India & Others reported in 2003 (3)
SCC 186, the Apex Court has held that in respect of the
Writ Petition No.25000/2019 34
matters affecting policy and those that require technical
expertise, the Court should show deference to, and follow
the recommendations of the Committee which is more
qualified to address the issues.
66.The Apex in the case of Association of
Registration Plates v/s Union of India & Others reported
in 2005 (1) SCC 679 has held that formulating conditions
of a tender document and awarding a contract of the nature
of those for supply of HSVRPs, greater latitude is required
to be conceded to the state authorities.
67.In the case of Union of India v/s Hindustan
Development Corporation reported in 1993 (3) SCC 499,
again the scope of judicial interference has been dealt with.
68.In the case of Tata Cellular v/s Union of India
reported in 1994 (6) SCC 651, it has been held that mere
power to choose cannot be termed arbitrary. The
Government has an interest in selecting the best and use of
such power for collateral purpose is interdicted by Article
14 of the Constitution of India.
69.In the case of Maa Binda Express Carrier &
Another v/s Northeast Frontier Railway & Others
reported in 2014 (3) SCC 760, it has been held that the
bid / tender, in response to a NIT, is only an offer which
State or its agencies are under no obligation to accept. It
has been further held that bidders participating in the tender
process cannot insist that their bids should be accepted
simply because a bid is highest or lowest.
70.In the case of Municipal Corporation, Ujjain &
Others v/s BVG India Limited & Others reported in 2018
Writ Petition No.25000/2019 35
(5) SCC 287, it has been held that the terms of the tender
are not open for judicial scrutiny as the invitation to tender
is a matter of contract.
71.In the case of Monarch Infrastructure (P) Limited
v/s Commissioner, Ulhasnagar Municipal Corporation &
Others reported in 2000 (5) SCC 287, it has been held that
the best judge to determine, whether the revised terms and
conditions of the tender process were better than the earlier
ones, is the authority who has invited the tender and not the
Court.
72.In the case of Directorate of Education & Others
v/s Educomp Datamatics Limited & Others reported in
2004 (4) SCC 19, it has been held that the terms of
initiation to tender are not open to the judicial scrutiny the
same being in the realm of contract. It has been further held
that the Government must have a free hand in setting the
terms of the tender.
73.In the case of Air India Limited v/s Cochin
International Airport Limited reported in (2000) 2 SCC
617, it has been held that award of a contract, whether it is
by a private party or by public body or the State, is
essentially a commercial transaction. It has further been
held that commercial decision considerations, which are
paramount, are commercial considerations and the State
can choose its own method to arrive at a decision. It can fix
its own terms of invitation to tender and that is not open to
judicial scrutiny.
74.In the case of Master Marine Services (P) Limited
v/s Metcalfe & Hodkinson (P) Limited & Another
Writ Petition No.25000/2019 36
reported in (2005) 6 SCC 138, it has been held that the
State can choose its own method to arrive at a decision and
the State and its instrumentalities have duty to be fair to all
the concerned. It has been further held that even when some
defect is found in decision making process, Court must
exercise its extraordinary writ jurisdiction with great
caution and that too in furtherance of public interest and
larger public interest in passing an order of intervention is
always a relevant consideration.
75.In the case of Haryana Urban Development
Authority & Others v/s Orchid Infrastructure Developers
Private Limited reported in (2017) 4 SCC 243, it has been
held that if the State or its instrumentalities act reasonably,
fairly and in public interest in awarding the contract, the
interference by the Court is very restrictive since no person
can claim Fundamental right to carry on business with the
Government.
76.In the case of Reliance Telecom Limited &
Another v/s Union of India & Another reported in (2017)
4 SCC 269, it has been held that in the matter relating to
complex auction procedure having enormous financial
ramification, the interference by the Courts based upon any
perception, which is though to be wise or assumed to be
fair, can lead to a situation which is not warrantable and
may have unforeseen adverse impact.
77.In the case of Meenakshi Mills Limited v/s Union
of India reported in (1974) 1 SCC 468, it has been held
whether there is any unfairness involved in determining, the
nature of the right alleged to have been infringed the
Writ Petition No.25000/2019 37
underlying purpose of the restriction imposed, the extent
and urgency of the evil sought to be remedied thereby the
disproportion of the imposition, the prevailing condition at
the relevant point of time, enter into judicial verdict. It has
further been held that the unreasonableness of the
legitimate expectation has to be determined with respect to
the circumstances relating to the trade of business in
question.
78.In the case of Lala Hari Chand Sarda v/s Mizo
District Council & Another reported in (1967) 1 SCR
1012, it has been held that canalization of a particular
business in favour of even a specified individual is
reasonable where the interests of the country are concerned
or where the business affects the economy of the country.
79.In the case of Krishnan Kakkanth v/s Government
of Kerela & Others reported in (1997) 9 SCC 495, it has
been held that a citizen has no Fundamental Right to insist
on Government or any other individual to do business with
him and the Government is entitled to enter into business
with any person or class of persons to the exclusion of
others.
80.In the case of Global Energy Limited & Another
v/s Adani Exports Limited & Others reported in (2005) 4
SCC 435, it has been held that unless terms of a tender
notice are wholly arbitrary, discriminatory or actuated by
malice, are not subject to judicial review. It has further
been held that principle is, therefore, well settled that the
terms of the invitation to tender are not open to judicial
scrutiny and the Courts cannot whittle down the terms of
Writ Petition No.25000/2019 38
the tender as they are in the realm of contract unless they
are wholly arbitrary, discriminatory or actuated by malice.
81.This Court does not find any reason to interfere
with the tender in the peculiar facts and circumstances of
the case. The Governments and their undertakings do have
free hand in setting terms of the tender and unless the terms
and conditions are arbitrary, discriminatory, malafide or
actuated by bias, the scope of interference by Courts does
not arise as held in the case of Michigan Rubber (India)
Limited (supra).
82.In light of the aforesaid judgment, in the present
case, as the petitioner has failed to establish that criteria
adopted by the respondents is contrary to public interest,
discriminatory or unreasonable, the question of interference
by this Court does not arise.
Accordingly, the present Writ Petition stands
dismissed.
Certified copy, as per rules.
(S.C. SHARMA)
J U D G E
(SHAILENDRA SHUKLA)
J U D G E
Ravi
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