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Issues Involved:
1. Validity of the High Court's decision to quash the contract awarded to AFCONS. 2. Evaluation of bids and determination of the lowest bidder. 3. Role and influence of the Asian Development Bank in the contract award process. 4. Judicial review of administrative decisions in the context of public contracts. Summary: 1. Validity of the High Court's Decision: The High Court quashed the decision of Paradip Port Trust to award the contract to AFCONS and directed negotiations with both AFCONS and Trafalgar House Construction of India Ltd. If negotiations failed within a month, the Port Trust was to initiate rebidding. The Supreme Court found that the High Court's interference was not justified, as there was no evidence of arbitrariness, unfairness, illegality, or irrationality in the award process. 2. Evaluation of Bids: The Tender Committee of Paradip Port Trust, after evaluating the bids, initially found discrepancies in the bid documents. The Asian Development Bank (ADB) did not support the corrected bid evaluation that favored Trafalgar House Construction, asserting that AFCONS was the lowest evaluated substantially responsive bidder. The Supreme Court noted that the High Court's conclusion that Trafalgar House Construction was the lowest bidder was factually incorrect and that AFCONS remained the lowest bidder throughout the process. 3. Role and Influence of the Asian Development Bank: ADB, which was financing the project, insisted that the contract be awarded to AFCONS, stating that no loan would be provided if the contract was awarded to anyone else or if rebidding occurred. The Supreme Court emphasized that ADB's role and its conditions were crucial, given the significant financial implications and the need for adherence to the specified procedures. 4. Judicial Review of Administrative Decisions: The Supreme Court reiterated that judicial review in contractual matters is limited to preventing arbitrariness, favoritism, and ensuring public interest. The Court found no malice, ulterior motives, or procedural impropriety in the award process. It cited Tata Cellular vs. Union of India, emphasizing that courts should not interfere with administrative decisions unless there is a clear violation of legal principles. Conclusion: The Supreme Court set aside the High Court's judgment, affirming the contract awarded to AFCONS by Paradip Port Trust. It highlighted the importance of avoiding delays and cost escalations in large-scale projects and concluded that rebidding would be detrimental to public interest. The appeal was allowed without any order as to costs.
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