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TMI Blog2013 (11) TMI 1700X X X X Extracts X X X X X X X X Extracts X X X X ..... decision to cancel the tender process was in no way discriminatory or malafide. On the contrary, if a contract had been awarded despite the deficiencies in the tender process serious questions touching the legality and propriety affecting the validity of the tender process would have arisen. In as much as the competent authority decided to cancel the tender process, it did not violate any fundamental right of the appellant nor could the action of the respondent be termed unreasonable so as to warrant any interference from this Court. The Division Bench of the High Court was, in that view, perfectly justified in setting aside the order passed by the Single Judge and dismissing the writ petition. Decision in this case Tata Cellular v. Union of India (1994) 6 SCC 651 [ 1994 (7) TMI 307 - SUPREME COURT] , Raunaq International Ltd. s case [ 1998 (12) TMI 623 - SUPREME COURT] and in Jagdish Mandal v. State of Orissa and Ors. (2007) 14 SCC 517 [ 2006 (12) TMI 447 - SUPREME COURT] were followed. In the result this appeal fails and is hereby dismissed with costs assessed at 25,000/-. X X X X Extracts X X X X X X X X Extracts X X X X ..... irly while granting contracts and that reasons for cancellation of the tender process should have been set out in the communication sent to the appellant instead of being disclosed subsequently in the affidavit filed in opposition to the writ petition. The learned Single Judge accordingly allowed the writ petition with a direction that so long as the appellant undertook to accept the penalty clause as a part of the contract between the parties the railway administration would consider its bid for acceptance and resultant allotment of the contract within 15 days of receipt of the undertaking. 6. Aggrieved by the judgment and order abovementioned, the railway administration preferred Writ Appeal (C) No.79 of 2012 before the Division Bench of the High Court of Gauhati. Relying upon the decision of this Court in Raunaq International Ltd. v. I.V.R. Construction Ltd. and Ors. (1999) 1 SCC 492 the Division Bench held that the appellant acquired no right to claim the award of the contract merely by reason of its bid being the highest. It further held that the scope of judicial review being limited in tender matters, the Court had to restrain itself from interfering with the process so lon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assed by the High Court had revealed that the contract could fetch ₹ 2,25,000/- per trip which was substantially higher than ₹ 1,46,872/- quoted by the appellant. Suffice it to say that not only is the reserve price applicable as on date higher than the amount offered by the appellant but even the market survey has brought forth rates higher than what was offered by the appellant. Allotment of any contract at the rate offered by the appellant would, therefore, result in a substantial financial loss to the railways which is neither in the public interest nor necessitated by any legal compulsion. Time lag in such matters plays an important role as it indeed has in the case at hand. 8. The scope of judicial review in matters relating to award of contract by the State and its instrumentalities is settled by a long line of decisions of this Court. While these decisions clearly recognize that power exercised by the Government and its instrumentalities in regard to allotment of contract is subject to judicial review at the instance of an aggrieved party, submission of a tender in response to a notice inviting such tenders is no more than making an offer which the State or its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the heartbeat of fair play. These actions are amenable to the judicial review only to the extent that the State must act validly for a discernible reason and not whimsically for any ulterior purpose. If the State acts within the bounds of reasonableness, it would be legitimate to take into consideration the national priorities; (b) fixation of a value of the tender is entirely within the purview of the executive and courts hardly have any role to play in this process except for striking down such action of the executive as is proved to be arbitrary or unreasonable. If the Government acts in conformity with certain healthy standards and norms such as awarding of contracts by inviting tenders, in those circumstances, the interference by Courts is very limited; (c) In the matter of formulating conditions of a tender document and awarding a contract, greater latitude is required to be conceded to the State authorities unless the action of tendering authority is found to be malicious and a misuse of its statutory powers, interference by Courts is not warranted; (d) Certain preconditions or qualifications for tenders have to be laid down to ensure that the contractor has the capa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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