Dismissed¶88

Suyash Dubey v. State of Chhattisgarh

Chhattisgarh HC19 Jun 2025WPC/354/2025

Case brief

AI extract

What is this about?

Writ petition (Article 226) by L-1 bidder challenging cancellation of e-tender dated 28.10.2024 (system Nos. 160699, 160700) and fresh e-tender dated 26.12.2024 (system Nos. 163469, 163475) by Nagar Panchayat Malhar, Bilaspur; cancellation caused by inadvertent opening of ineligible bidders' tenders (Sub-Engineer report; Annexure R-3/5); held cancellation of entire tender process justified, no favoritism; judicial restraint in tender matters per N.G. Projects Ltd. v. Vinod Kumar Jain (2022) 6 SCC 127 and Banshidhar Construction Pvt. Ltd. v. Bharat Coking Coal Ltd.; petition dismissed, no costs, liberty to participate in fresh NIT.

What did the court decide?

None; petition dismissed with no order as to costs, the petitioner being at liberty to participate in the fresh NIT floated by respondent No. 3 if he fulfils its terms and conditions.

Suyash Dubey Vs State of Chhattisgarh — Writ and Judicial Review | Chhattisgarh HC (2025)

What the court decided

AI extract

Outcome

None; petition dismissed with no order as to costs, the petitioner being at liberty to participate in the fresh NIT floated by respondent No. 3 if he fulfils its terms and conditions.

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Issue for consideration

Whether the cancellation by respondent No. 3 of the e-tender dated 28.10.2024 (system Nos. 160699 and 160700), after the petitioner was declared L-1, and the issuance of a fresh e-tender dated 26.12.2024 (system Nos. 163469 and 163475) for the same works was against the rules and curtailed the petitioner's right to participate, such that the fresh E-Tender should be stayed/quashed and the work order directed to the petitioner.

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Court's answer

Where the authorities discover, after opening of bids, that there was an error in scrutiny of the documents submitted by the intending bidders (ineligible bidders erroneously treated as eligible / no bidder found qualified), they are justified in cancelling the entire tender process; the cancellation here involved no favoritism towards any particular bidder.

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Ratio / Principle

It was not a case of rejection of the L-1 petitioner's sole candidature: the entire tender process was cancelled and a fresh NIT floated in which the petitioner may again participate; accordingly the petitioner has no sustainable grievance merely because he had been declared L-1 under the cancelled tender, and the writ court should not interfere with the employer's tender decision absent arbitrariness or mala fides in the decision-making process.

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Detailed headnote1 paragraphs

Tender challenge dismissed - Chhattisgarh High Court, WPC No. 354 of 2025 (decided 20/06/2025, Per Ramesh Sinha, CJ). Nagar Panchayat Malhar (respondent No. 3) issued an e-tender dated 28.10.2024 (system Nos. 160699 and 160700) for construction of Muktidham (ward No. 9), Mangal Bhawan, CC Road paver block and kitchen shed; the petitioner was declared L-1. After the Sub-Engineer reported that, by mistake, online tenders of ineligible bidders had been opened and no bidder was found qualified, the tender was cancelled with the consent of the General Committee (notice on notice board, 26.12.2024; Annexure R-3/5) and a fresh e-tender dated 26.12.2024 (system Nos. 163469 and 163475) was floated. The petitioner sought stay/quashing of the fresh tender and a work order. Held: upon discovery of error in scrutiny of bidders' documents the authorities were justified in cancelling the entire tender process; no favoritism was shown; relying on N.G. Projects Ltd. v. Vinod Kumar Jain (2022) 6 SCC 127 and Banshidhar Construction Pvt. Ltd. v. Bharat Coking Coal Ltd. (Civil Appeal No. 11005 of 2024, decided 04.10.2024), the writ court should refrain from imposing its decision over the employer in tender matters absent arbitrariness or mala fides in the decision-making process. Petition dismissed, no costs; petitioner free to participate in the fresh NIT if he fulfils its terms and conditions.

2025:CGHC:26259-DB

NAFR

HIGH COURT OF CHHATTISGARH AT BILASPUR

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WPC No. 354 of 2025

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Suyash Dubey S/o Satish Dubey Aged About 35 Years R/o Old Sarkanda, Daihanpara, Near Mini Hostel, Lingiyadih, South Eastern Cold Limited Bilaspur, Bilaspur, C.G.

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--- Petitioner(s)

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versus

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1 - State Of Chhattisgarh Through It Secretary, Department of Panchayat And Rural Development, Atal Nagar, Nawa Raipur, District-Raipur, C.G.

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2 – Collector, Through Its Office, Bilaspur, District- Bilaspur, C.G.

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3 - Chief Municipal Officer Nagar Panchayat, Malhar, District- Bilaspur, C.G.

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4 - Chhattisgarh Infotech Promotion Society, (Chips) 3rd Floor, State Data Centre Building, Opp. New Circuit House, Civil Lines, Raipur- 492001

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Chhattisgarh

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5 - State Of Chhattisgarh Through Its Secretary Department Of Urban Administration And Development, 4th Floor, D-Block, Indrawati Bhawan Atal Nagar, Raipur, Chhattisgarh.

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--- Respondent(s) For Petitioner(s) : Mr. Rishabh Bisen, Advocate. For Respondents No. 1, 2 & 5 : Mr. Shashank Thakur, Deputy Advocate General For Respondent No. 3 : Mr. Atanu Ghosh, Advocate.

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Hon’ble Shri Ramesh Sinha, Chief Justice Hon’ble Shri Bibhu Datta Guru, Judge

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Order on Board

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Per Ramesh Sinha, Chief Justice

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20/06/2025

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1. Heard Mr. Rishabh Bisen, learned counsel for the petitioner, Mr. Shashank Thakur, learned Deputy Advocate General for the State/ respondent No. 1, 2 and 5 as well as Mr. Atanu Ghosh, learned counsel for the respondent No. 3.

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2. The petitioner, by way of this petition under Article 226 of the Constitution of India, prays for the following relief(s):

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“ 10.1 That, This Hon'ble Court May Kindly be pleased to call for Entire records pertaining to the case of the petitioner.

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10.2 This Hon'ble Court May Kindly be pleased to Stay effect and operation of the E-Tender dated 26. 12 2024 (Annexure P/3).

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10.3 This Hon'ble Court May Kindly direct respondent No. 2 to Proceed with the proceedings of E-tender Notice dated 28.10.2024 and proceed with the Ranking allotted to the petitioner ie 1" and direct to Allow the work order in favour of the petitioner.

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10.4 That, this Hon'ble Court be pleased to Quash the E- Tender dated 26.12.2024 (Annexure P/3).

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10.4 That, any other Relief Order which may deem fit and just in the fact and circumstances of the case including awards of the costs of the Petition may be given.”

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3. The facts, in brief, as projected by the petitioner are that the respondent

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No. 3 has issued an E-Tender dated 28.10.2024 for construction of Muktidham for ward No. 9 and construction of Mangal Bhawan and CC Road Paver Block and Kitechen Shed mentioned at Sr. No. 2 & 3 as tender System No. 160699 and 160700. The petitioner has applied and has participated in E-Tenderwith respect to system No. No. 160699 and

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In both the system Nos., the petitioner stood L-1. However, surprisingly without giving any notice or opportunity of hearing even not without cancelling the e-tender dated 28.10.2024, the respondent No 3 has again issued E-Tender on 26.12.2024 for the same work bearing its system tender No. 163469 and 163475 for which petitioner had applied and after due consideration was declared L-1. Being aggrieved, the petitioner made a representation on 30.12.2024 to the respondent authorities but nothing has been done so far.

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4. On the other hand, Mr. Shashank Thakur, learned Deputy Advocate General submits that the tenders were floated by the respondent No. 3 and it is the respondent No. 3 who can have a say in this matter.

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5. Mr. Atanu Ghosh, learned counsel appearing for the respondent No. 3 submits that by the instant petition, the petitioner has challenged E- tender dated 26.12.2024 issued respondent No. 3 system tender no. 163469 & 163475 on the ground that earlier the E-tender was issued for the same work on 28.10.2024 in which the petitioner has participated and without considering the candidature of the petitioner and without cancelling the earlier E-tender dated 28.10.2004, a new tender has been issued which is against the rules and which curtails the right of the petitioner to participate in the tender.

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6. Mr. Ghosh, relying on the affidavit filed on behalf of respondent No. 3, submits that on 28.10.2024 the office of Nagar Panchayat Malhar. District Bilaspur, issued an NIT under the system No. 160099 and 160700 against which the petitioner submitted its bbid inw hich he was declared L-1. During pendency of the e-tender, the respondent No. 3 issued a letter to the Sub Engineer, Nagar Panchayat, Malhar to submit the minute observation report of the documents submitted by the bidders against the aforesaid system Nos. In pursuance of the same, the Sub

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Engineer submitted its reply / report and stated that on examination, it was found that by mistake, online tenders of the ineligible bidders were opened for which he tendered his apology. In pursuance of the said report, the proposal for cancellation of the e-tender was submitted before the General Committee and with the consent of the Committee, the earlier tender was cancelled and a notice in this regard was affixed on the notice board of the Nagar Panchayat on 26.12.2024. It is further submitted that some of the bidders who had submitted their bids, on making application for refund of the FDR, the same have been returned. The fresh tender has been issued after cancelling the first tender and if the petitioner intends to participate in the second round of tender, may do so.

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7. The petitioner has also filed a rejoinder controverting the submissions advanced by the learned counsel for the respondent No. 3.

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8. We have heard learned counsel for the parties, perused the pleadings and documents appended thereto.

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9. In nutshell, the petitioner is aggrieved by the fact that when the petitioner was declared in the first call of the tender proceedings, without cancelling the tender proceedings, the second NIT was floated by the respondent No. 3. From perusal of Annexure R-3/5, which is a notice stating that the tender dated 28.10.2024 in respect of system No. 160699 and 160700 was cancelled on the ground that due to inadvertent error, the ineligible candidates were also declared as eligible. The report of the Sub-Engineer also states that none of the bidders have been found qualified for participating in the tender process. The earlier tender was cancelled and informed through notice on the notice board and as such, the petitioner cannot have any grievance that

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merely because he was declared L-1, the tenders have been cancelled and fresh NIT has been floated.

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10. In N.G. Projects Ltd. v. Vinod Kumar Jain¹ ,, the Apex Court has observed as under:

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“22. The satisfaction whether a bidder satisfies the tender condition is primarily upon the authority inviting the bids. Such authority is aware of expectations from the tenderers while evaluating the consequences of non-performance. In the tender in question, there were 15 bidders. Bids of 13 tenderers were found to be unresponsive i.e., not satisfying the tender conditions. The writ petitioner was one of them. It is not the case of the writ petitioner that action of the Technical Evaluation Committee was actuated by extraneous considerations or was malafide. Therefore, on the same set of facts, different conclusions can be arrived at in a bona-fide manner by the Technical Evaluation Committee. Since the view of the Technical Evaluation Committee was not to the liking of the writ petitioner, such decision does not warrant for interference in a grant of contract to a successful bidder.

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23. In view of the above judgments of this Court, the Writ Court should refrain itself from imposing its decision over the decision of the employer as to whether or not to accept the bid of a tenderer. The Court does not have the expertise to examine the terms and conditions of the present day economic activities of the State and this limitation should be kept in view. Courts should be even more reluctant in interfering with contracts involving technical issues as there is a requirement of the necessary expertise to adjudicate upon such issues. The approach of the Court should be not to find fault with magnifying glass in its hands, rather the Court should examine as to whether the decision-making process is after complying with the procedure contemplated by the tender conditions. If the Court finds that there is total arbitrariness or that the tender has been granted in a malafide manner, still the Court should refrain from interfering in the grant of tender but instead relegate the parties to seek damages for the wrongful exclusion rather than to injunct the execution of the contract. The injunction or interference in the tender leads to additional costs on the State and is also against public interest. Therefore, the State and its citizens suffer twice, firstly by paying escalation costs and secondly, by being deprived of the infrastructure for which the present-day Governments are expected to work.”

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11. Recently, the Apex Court, in the matter of Banshidhar Construction

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Pvt. Ltd. v. Bharat Coking Coal Ltd. & Others , {Civil Appeal No.

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1 (2022) 6 SCC 127

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11005 of 2024, decided on 04.10.2024}, taking note of the decisions rendered in various other celebrated judgments, observed as under:

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“21. There cannot be any disagreement to the legal proposition propounded in catena of decisions of this Court relied upon by the learned counsels for the Respondents to the effect that the Court does not sit as a Court of Appeal in the matter of award of contracts and it merely reviews the manner in which the decision was made; and that the Government and its instrumentalities must have a freedom of entering into the contracts. However, it is equally well settled that the decision of the government/ its instrumentalities must be free from arbitrariness and must not be affected by any bias or actuated by malafides. Government bodies being public authorities are expected to uphold fairness, equality and public interest even while dealing with contractual matters. Right to equality under Article 14 abhors arbitrariness. Public authorities have to ensure that no bias, favouritism or arbitrariness are shown during the bidding process and that the entire bidding process is carried out in absolutely transparent manner.

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22. At this juncture, we may reiterate the well-established tenets of law pertaining to the scope of judicial intervention in Government Contracts.

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23. In Sterling Computers Limited v. M/s. M & N Publications Limited and Others² , this Court while dealing with the scope of judicial review of award of contracts held: -

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“18. While exercising the power of judicial review, in respect of contracts entered into on behalf of the State, the Court is concerned primarily as to whether there has been any infirmity in the “decision making process”. In this connection reference may be made to the case of Chief Constable of the North Wales Police v. Evans [(1982) 3 All ER 141] where it was said that: (p. 144a)

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“The purpose of judicial review is to ensure that the individual receives fair treatment, and not to ensure that the authority, after according fair treatment, reaches on a matter which it is authorised or enjoined by law to decide for itself a conclusion which is correct in the eyes of the court.”

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By way of judicial review the court cannot examine the details of the terms of the contract which have been entered into by the public bodies or the State. Courts have inherent limitations on the scope of any such

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2 (1993) 1 SCC 445

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enquiry. But at the same time as was said by the House of Lords in the aforesaid case, Chief Constable of the North Wales Police v. Evans [(1982) 3 All ER 141] the courts can certainly examine whether “decision-making process” was reasonable, rational, not arbitrary and violative of Article 14 of the Constitution.”

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24. In Tata Cellular vs. Union of India³ , this Court had laid down certain principles for the judicial review of administrative action.

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“94. The principles deducible from the above are:

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(1) The modern trend points to judicial restraint in administrative action.

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(2) The court does not sit as a court of appeal but merely reviews the manner in which the decision was made.

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(3) The court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible.

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(4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts.

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(5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principle of reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides.

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(6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure. Based on these principles we will examine the facts of this case since they commend to us as the correct principles.”

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3 (1994) 6 SCC 651

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25. It has also been held in ABL International Limited and Another vs. Export Credit Guarantee Corporation of India Limited and Others⁴ , as under: -

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“53. From the above, it is clear that when an instrumentality of the State acts contrary to public good and public interest, unfairly, unjustly and unreasonably, in its contractual, constitutional or statutory obligations, it really acts contrary to the constitutional guarantee found in Article 14 of the Constitution.”

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26. In Jagdish Mandal vs. State of Orissa and Others⁵ , this Court after discussing number of judgments laid down two tests to determine the extent of judicial interference in tender matters. They are: -

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“22. (i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone; or Whether the process adopted or decision made is so arbitrary and irrational that the court can say: “the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached;”

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(ii) Whether public interest is affected. If the answers are in the negative, there should be no interference under Article 226. Cases involving blacklisting or imposition of penal consequences on a tenderer/contractor or distribution of State largesse (allotment of sites/shops, grant of licences, dealerships and franchises) stand on a different footing as they may require a higher degree of fairness in action.”

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27. In Mihan India Ltd. vs. GMR Airports Ltd. and Others⁶ , while observing that the government contracts granted by the government bodies must uphold fairness, equality and rule of law while dealing with the contractual matters, it was observed in Para 50 as under: -

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“50. In view of the above, it is apparent that in government contracts, if granted by the government bodies, it is expected to uphold fairness, equality and rule of law while dealing with contractual matters. Right to equality under Article 14 of the Constitution of India abhors arbitrariness. The transparent bidding process is favoured by the Court to ensure that constitutional requirements are satisfied. It is said that the constitutional

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5 (2007) 14 SCC 517

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6 (2022) SCC OnLine SC 574

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4 (2004) 3 SCC 553

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guarantee as provided under Article 14 of the Constitution of India demands the State to act in a fair and reasonable manner unless public interest demands otherwise. It is expedient that the degree of compromise of any private legitimate interest must correspond proportionately to the public interest.”

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28. It was sought to be submitted by the learned Counsels for the Respondents relying upon the observations made in Central Coalfields Limited and Another vs. SLL-SML (Joint Venture Consortium) and Others⁷ , that whether a term of NIT is essential or not is a decision taken by the employer which should be respected. However, in the said judgment also it is observed that if the employer has exercised the inherent authority to deviate from the essential term, such deviation has to be made applicable to all the bidders and potential bidders. It was observed in Para 47 and 48 as under:-

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“47. The result of this discussion is that the issue of the acceptance or rejection of a bid or a bidder should be looked at not only from the point of view of the unsuccessful party but also from the point of view of the employer. As held in Ramana Dayaram Shetty [Ramana Dayaram Shetty v. International Airport Authority of India, (1979) 3 SCC 489] the terms of NIT cannot be ignored as being redundant or superfluous. They must be given a meaning and the necessary significance. As pointed out in Tata Cellular [Tata Cellular v. Union of India, (1994) 6 SCC 651] there must be judicial restraint in interfering with administrative action. Ordinarily, the soundness of the decision taken by the employer ought not to be questioned but the decision-making process can certainly be subject to judicial review. The soundness of the decision may be questioned if it is irrational or mala fide or intended to favour someone or a decision “that no responsible authority acting reasonably and in accordance with relevant law could have reached” as held in Jagdish Mandal [Jagdish Mandal v. State of Orissa, (2007) 14 SCC 517] followed in Michigan Rubber [Michigan Rubber (India) Ltd. v. State of Karnataka, (2012) 8 SCC 216].

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48. Therefore, whether a term of NIT is essential or not is a decision taken by the employer which should be respected. Even if the term is essential, the employer has the inherent authority to deviate from it provided the deviation is made applicable to all bidders and potential bidders as held in Ramana Dayaram Shetty [Ramana

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7 (2016) 8 SCC 622

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Dayaram Shetty v.International Airport Authority of India, (1979) 3 SCC 489] . However, if the term is held by the employer to be ancillary or subsidiary, even that decision should be respected. The lawfulness of that decision can be questioned on very limited grounds, as mentioned in the various decisions discussed above, but the soundness of the decision cannot be questioned, otherwise this Court would be taking over the function of the tender issuing authority, which it cannot. ”

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12. It is not a case that upon declaring L-1, the sole candidature of the petitioner has been rejected rather the entire tender process has been cancelled and a fresh NIT has been floated by the respondent No. 3 wherein the petitioner can again participate. It is not a case where some favoritism is shown towards any particular bidder by the respondent authorities. If the authorities had found that there was some error in scrutiny of the documents submitted by the intending bidders which later came to their knowledge, then the respondent authorities were justified in cancelling the entire tender process.

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13. In view of the foregoing discussion, this petition being devoid of merit, is hereby dismissed . No order as to cost(s). Needless to state that the petitioner is at liberty to participate in the fresh NIT floated by the respondent No. 3, in case he fulfills the terms and conditions of the said NIT.

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Sd/Sd/(Bibhu Datta Guru) (Ramesh Sinha) JUDGE CHIEF JUSTICE

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Amit
AMIT
KUMAR
DUBEY
Digitally signed
by AMIT KUMAR
DUBEY
Date: 2025.06.20
19:17:30 +0530

Suyash Dubey v. State of Chhattisgarh

Case brief

What is this about?

What did the court decide?

Suyash Dubey v. State of Chhattisgarh

Case brief

What is this about?

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What the court decided

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