Devika Sahu Vs State of Chhattisgarh

3 - M/s H.L.L. Life Care Limited Through The Director H.L.L. Life Cate Ltd. H.L.L. Bhawan Mahilamandiram Road Thiruvanaanthapuram - 695012 (Kerala)

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... Respondent(s)

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For Petitioner(s) : Mr. Prafull N. Bharat, Sr. Advocate, along with Mr. Pravesh Sharma, Advocate. For Respondent(s) : Mr. Praveen Das, Additional Advocate General.

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Hon'ble Shri Ramesh Sinha, Chief Justice Hon'ble Shri Ravindra Kumar Agrawal, Judge

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Order on Board

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Per Ramesh Sinha, Chief Justice 10/04/2026

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1 . Heard Mr. Prafull N. Bharat, Sr. Advocate along with Mr. Pravesh

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Sharma, learned counsel for the petitioner. Also hear Mr. Praveen Das, learned Additional Advocate General, appearing for the Respondent/State.

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2 . By way of this writ petition (PIL), the petitioner has prayed for following reliefs:-

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“10.1 To call for the records of the case for the kind perusal of this Hon'ble Court.

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10.2 To issue an appropriate writ or order and declare that appointment / nomination of res.no.3 as service provider for effective implementation of CIDMS and issuance of work order dated 02.02.26 (Annexure P-1) is bad in law.

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10.3 To issue an appropriate writ or order and quash the decision by which res.no.3 has been appointed as service provider for effective implementation of CIDMS and issuance of work order dated 02.02.26 (Annexure P-1).

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10.4 To issue an appropriate writ or order and direct the State Government to initiate a transparent processas prescribed under the C.G. Store Purchase Rules, 2002.

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10.5 Any other relief deemed fit in the facts and circumstances of the case may also be granted.”

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The present Public Interest Litigation has been filed by the petitioner, a citizen of India, under the Constitution, invoking the fundamental rights guaranteed under Part III, against respondent nos. 1 and 2, who are State authorities and thus amenable to the writ jurisdiction of this Hon’ble Court. The petition challenges the legality and validity of the action of the respondents in awarding a contract on a

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nomination basis and issuing a work order in favour of respondent no. 3, H.L.L. Lifecare Limited, for providing diagnostic and healthcare services in public health institutions across the State of Chhattisgarh. The controversy arises in the backdrop of the National Health Mission, under which the Chhattisgarh Integrated Diagnostic Management System (CIDMS) was established to ensure the provision of free, accessible, and quality diagnostic services in government health facilities in accordance with IPHS guidelines. CIDMS was envisaged as a comprehensive mechanism to strengthen diagnostic infrastructure across the State, particularly in rural, remote, and tribal areas where earlier attempts to implement PPP models had failed due to lack of private participation. However, owing to admitted deficiencies in manpower, infrastructure, equipment, consumables, and logistical arrangements, the State authorities deemed it necessary to procure such services from external agencies.

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It is the specific case of the petitioner that the respondents, in complete disregard of the governing statutory framework and settled principles of public procurement, arbitrarily awarded the contract to respondent no. 3 on a nomination basis without inviting tenders or ensuring any form of competitive bidding. The Chhattisgarh Store Purchase Rules, 2002, as amended on 11.07.2024, categorically mandate that all government procurements must be conducted through the GeM portal, ensuring transparency, adequate competition, and participation of at least three bidders, with the contract to be awarded to the lowest eligible bidder, except in rare and exceptional circumstances

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such as emergency or proprietary procurement, which must be duly justified and recorded. The petitioner asserts that no such exceptional circumstances existed in the present case, nor have the respondents disclosed any cogent or valid reasons for bypassing the mandatory tender process. The impugned action is further alleged to be violative of the principles of transparency, fairness, and accountability, and contrary to the guidelines issued by the Central Vigilance Commission, which strongly discourage nomination-based contracts without adequate justification and emphasize open competitive bidding as the norm. By excluding potential bidders and dispensing with price discovery, the respondents have allegedly caused grave prejudice to public interest and the State exchequer, rendering the impugned action arbitrary, nontransparent, and legally unsustainable.

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5 . Mr. Prafull N. Bharat, learned Senior Advocate appearing for the petitioner submits that the impugned action of respondent nos. 1 and 2 in directly awarding the contract to respondent no. 3 on a nomination basis is wholly arbitrary, illegal, and in blatant violation of the Chhattisgarh Store Purchase Rules, 2002, as well as settled principles governing public procurement. It is contended that the Rules of 2002 mandate that procurement of goods and services by the State must ordinarily be undertaken through a transparent and competitive bidding process, ensuring fairness, equality, and accountability. The respondents have completely bypassed this mandatory requirement without demonstrating the existence of any exceptional circumstances such as emergency or proprietary necessity, which alone could justify

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resorting to single-source procurement. No reasons have been recorded, nor any justification disclosed, thereby rendering the decision arbitrary and unsustainable in law.

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It is further submitted that such an action is violative of Article 14 of the Constitution of India, as it fails to meet the standards of fairness, non-arbitrariness, and transparency required in the distribution of State largesse. The respondents, being custodians of public resources, were under a legal obligation to adopt procedures that promote competition and enable proper price discovery. By dispensing with the tender process, the respondents have not only excluded eligible participants but have also deprived the State of the opportunity to secure the most economically advantageous and technically sound offer, thereby causing potential loss to the public exchequer. The absence of competitive bidding further eliminates any objective assessment of the credentials and performance capabilities of respondent no. 3, raising serious concerns regarding quality and accountability.

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Learned counsel further submits that the impugned action is contrary to the General Financial Rules, 2017, as well as the guidelines issued by the Central Vigilance Commission, which consistently emphasize that public procurement must be conducted through fair, transparent, and competitive processes, with nomination being an exception rather than the rule. The arbitrary exercise of administrative discretion by the respondents amounts to abuse of power and is in breach of the doctrine of public trust, which obligates the State to act in the best interest of the public while dealing with public resources. In

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view of the aforesaid, it is prayed that this Hon’ble Court may be pleased to set aside the impugned action of awarding the contract to respondent no. 3 as being illegal, arbitrary, and violative of constitutional and statutory provisions.

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On the other hand, Mr. Praveen Das, learned Additional Advocate General appearing for the State/respondents submit that the present writ petition is misconceived, devoid of merit, and proceeds on an erroneous assumption that public procurement in all circumstances must necessarily be through open competitive bidding, ignoring the statutory scheme under the Chhattisgarh Store Purchase Rules, 2002 and the settled exceptions carved out therein. The impugned nomination of respondent no.3, namely H.L.L. Life Care Limited, was made strictly in accordance with the governing legal framework and in furtherance of the larger public interest under the National Health Mission and the Chhattisgarh Integrated Diagnostic Management System (CIDMS), which is a time-sensitive, mission-critical public health initiative. The services in question relate to essential diagnostic healthcare delivery across government health institutions, including remote and tribal areas, where continuity, technical competence, and institutional capacity are paramount considerations. The decision to engage respondent no.3 was taken after due application of mind to operational requirements, existing infrastructure gaps, and the necessity of ensuring uninterrupted delivery of diagnostic services to the public at large. The petitioner’s selective reliance on general principles of competitive bidding ignores the settled legal position that such

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principles are not absolute and admit of exceptions, particularly in cases involving specialized, urgent, and welfare-oriented public services where adherence to rigid tendering processes may defeat the very object of public interest.

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It is further submitted that the Chhattisgarh Store Purchase Rules, 2002 themselves expressly permit procurement on nomination basis or single-source selection in exceptional circumstances, including situations involving specialized services and urgent public requirements, subject to recording of satisfaction by the competent authority. The amendment dated 11.07.2024 introducing GeM-based procurement does not obliterate such statutory exceptions and must be read harmoniously with the parent rules and the nature of the procurement involved. The reliance placed by the petitioner on Central Vigilance Commission circulars and General Financial Rules is misplaced, as these guidelines themselves recognize permissible deviations where justified by administrative necessity and public interest, particularly in mission-driven programmes. It is well settled that judicial review in contractual and procurement matters is limited to examining arbitrariness, mala fides, or statutory violation, and not to substitute the Court’s view for that of the competent authority in matters of policy and administrative discretion. In the present case, no mala fides, procedural illegality, or arbitrariness has been demonstrated. The impugned action is a bona fide policy decision taken to ensure efficient and uninterrupted public healthcare delivery, and therefore does not warrant interference by this Hon’ble Court under Article 226 of the Constitution.

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We have heard learned counsel for the parties and perused the documents appended with writ petition.

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Having considered the rival submissions and the pleadings on record, this Court is of the considered view that the present writ petition, in substance, assails a policy decision and contractual arrangement of the State in the realm of public procurement, which has been taken in furtherance of a welfare-oriented and time-sensitive public health programme under the National Health Mission and CIDMS. The petitioner has failed to demonstrate any enforceable legal right having been infringed, or any clear violation of statutory provisions or constitutional mandate that would warrant interference in exercise of jurisdiction under Article 226 of the Constitution of India. The challenge is premised essentially on alleged deviation from tendering norms and procurement guidelines, which, even if examined on their own terms, involve disputed questions relating to administrative necessity, policy considerations, and technical evaluation, falling squarely within the domain of executive decision-making. It is well settled that in matters of contractual and procurement policy, particularly in specialized sectors like public health services, the scope of judicial review is limited and the Court does not act as an appellate authority to reassess the merits of the decision unless it is shown to be vitiated by mala fides, manifest arbitrariness, or patent illegality, none of which are made out in the present case. In absence of any foundational pleading or material establishing violation of mandatory statutory provisions or constitutional infirmity, the writ petition is not maintainable and is liable to be

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dismissed at the threshold.

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It is relevant to mention that it is the duty of this Court to ensure that there is no personal gain, private motive and oblique notice behind filing of PIL. In order to preserve the purity and sanctity of the PIL, the Courts must encourage genuine and bonafide PIL and effectively discourage and curb the PIL filed for extraneous considerations.

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The Courts should, prima facie, verify the credentials of the petitioner before entertaining a PIL. It is also well settled that the Courts before entertaining the PIL should ensure that the PIL is aimed at redressal of genuine public harm or public injury. The Court should also ensure that there is no personal gain, private motive or oblique motive behind filing the public interest litigation. The Courts should ensure the jurisdiction in public interest is invoked for genuine purposes by persons who have bona fide credentials and who do not seek to espouse or pursue any extraneous object. Otherwise, the jurisdiction in public interest can become a source of misuse by private persons seeking to pursue their own vested interests.

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A Division Bench of the Allahabad High Court, in the case of Gurmet Singh Soni Vs. State of U.P. and others : 2021 (5) ADJ 409 , noticing the decision of the Apex Court in State of Uttaranchal Vs. Balwant Singh Chaufal & Ors., 2010 AIR SCW 1029 and other judgments of the Apex Court on the issue, has dismissed the public interest litigation.

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The Courts cannot allow its process to be abused for oblique purposes, as was observed by the Supreme Court Court in Ashok

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Kumar Pandey v. State of West Bengal , reported in (2004) 3 SCC 349. In Balwant Singh Chaufal (supra) the Hon’ble Supreme Court had discussed the three stages of a PIL which has been discussed above. The Supreme Court, in Balwant Singh Chaufal (supra) states as to how this important jurisdiction, i.e., PIL has been abused at Para 143 by observing as under:

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“143. Unfortunately, of late, it has been noticed that such an important jurisdiction which has been carefully carved out, created and nurtured with great care and caution by the courts, is being blatantly abused by filing some petitions with oblique motives. We think time has come when genuine and bona fide public interest litigation must be encouraged whereas frivolous public interest litigation should be discouraged. In our considered opinion, we have to protect and preserve this important jurisdiction in the larger interest of the people of this country but we must take effective steps to prevent and cure its abuse on the basis of monetary and non-monetary directions by the courts.”

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The Supreme Court, in Holicow Pictures (P) Ltd. v. Prem Chand Mishra , reported in (2007) 14 SCC 281 which has relied Janata Dal v. H.S. Chowdhary , reported in (1992) 4 SCC 305, observed as under:

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“12. It is depressing to note that on account of such trumpery proceedings initiated before the courts, innumerable days are wasted, which time otherwise could have been spent for the disposal of cases of the genuine litigants. Though we spare no efforts in fostering and developing the laudable concept of PIL and extending our long arm of sympathy to the poor, the ignorant, the oppressed and the needy whose fundamental rights are infringed and violated and whose grievances go unnoticed,

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unrepresented and unheard; yet we cannot avoid but express our opinion that while genuine litigants with legitimate grievances relating to civil matters involving properties worth hundreds of millions of rupees and criminal cases in which persons sentenced to death facing gallows under untold agony and persons sentenced to life imprisonment and kept in incarceration for long years, persons suffering from undue delay in service matters— government or private, persons awaiting the disposal of cases wherein huge amounts of public revenue or unauthorised collection of tax amounts are locked up, detenu expecting their release from the detention orders, etc. etc. are all standing in a long serpentine queue for years with the fond hope of getting into the courts and having their grievances redressed, the busybodies, meddlesome interlopers, wayfarers or officious interveners having absolutely no public interest except for personal gain or private profit either of themselves or as a proxy of others or for any other extraneous motivation or for glare of publicity, break the queue muffing their faces by wearing the mask of public interest litigation and get into the courts by filing vexatious and frivolous petitions and thus criminally waste the valuable time of the courts and as a result of which the queue standing outside the doors of the courts never moves, which piquant situation creates frustration in the minds of the genuine litigants and resultantly they lose faith in the administration of our judicial system.”

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The Hon’ble Supreme Court, in Gurpal Singh v. State of Punjab & Others reported in (2005) 5 SCC 136, the appointment of the appellant as Auction Recorder was challenged. The Court held that the scope of entertaining a petition styled as a public interest litigation and locus standi of the petitioner particularly in matters involving service of an employee has been examined by this Court in various cases. The Court observed that before entertaining the petition, the Court must be

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satisfied about (a) the credentials of the applicant; (b) the prima facie correctness or nature of information given by him; (c) the information being not vague and indefinite. The information should show gravity and seriousness involved. The court has to strike balance between two conflicting interests; (i) nobody should be allowed to indulge in wild and reckless allegations besmirching the character of others; and (ii) avoidance of public mischief and to avoid mischievous petitions seeking to assail, for oblique motives, justifiable executive actions.

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Further, the issue raised in the present petition has already been considered by the Division Bench of Bombay High Court in the case of “ Dialysis Service Providers Association v. Union of India and

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Others ”, order dated 16-06-2025, passed in Writ Petition No. 3229 of

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2024, in which it has been considered that:-

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“ 8) Mr. Kanade would further submit that the illegality committed by the Respondent No.2-State Government in nominating Respondent No.3 without tender process is compounded by Respondent No.3 by proceeding to select Strategic Partner only from amongst its own empaneled entities by conducted a closed tender process. That Respondent Nos. 5 and 6 have been selected as Strategic Partner by Respondent No.3 primarily on account of commercial arrangement favouring Respondent No.3 rather than on merit or capability. Mr. Kanade would accordingly pray for setting aside the impugned MOU, the impugned RFQ as well as letter of awards made in favour of Respondent Nos. 5 and 6.

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17) Respondent No.3 is a Public Sector Undertaking, wholly owned by the Government of India. The State Government has considered the vast experience of Respondent No.3 in implementing projects of large magnitude across the country. Respondent No.3 has apparently set up vast network of health care service centers across the country. It has several

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business verticals under the brand names HINDCARE, HINDLABS etc. through which diagnostic and specialty lab services are provided throughout the country. Respondent No.2 has thus considered the expertise of Respondent No.3 and has accordingly selected it as an agency for implementation of the Project of providing dialysis services in Rural Health Care Centers. It is an arrangement executed between the Government and its instrumentality. We do not find any element of arbitrariness or irrationality in the said arrangement, particularly while deciding the petition filed by an association of seven private entities looking for business opportunity.

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18) Also of relevance is the fact that Petitioner-Association on its own never applied to the State Government for implementation of the Program initiated by it. It did not make representation to the State Government questioning execution of the MOU dated 29 April 2024. It waited till Respondent No.4 floated RFQ dated 7 May 2024 and decided to file the present petition by raising a grievance that non-empaneled entities have been excluded by Respondent No.3 from participating in the impugned RFQ.

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21) The impugned MOU dated 29 April 2024 executed by the State Government is for implementation of vital project of providing free dialysis services at Rural Health Care Centers. The Project is of immense importance to the poor and needy patients particularly in rural areas of the State. The Project is implemented by a Public Sector Undertaking of the Central Government. It was possible for the members of the PetitionerAssociation to become Strategic Partner of Respondent No.3 by getting themselves empaneled as well as by participating in the impugned RFQ. They have failed to avail the said opportunity. Private interests of the members of the Petitioner-Association cannot prevail over public interest of providing dialysis services to poor and needy patients of rural areas in the State of Maharashtra. We are therefore not inclined to entertain the challenge raised by the Petitioner-Association to the impugned MOU or impugned RFQ or impugned Notification.”

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For the reasons stated hereinabove, we do not find any scope for interference in the present Public Interest Litigation filed by the petitioner. Accordingly, the petition is dismissed .

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20. Security deposit stands forfeited.

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Sd/-

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Sd/-

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(Ravindra Kumar Agrawal) (Ramesh Sinha) Judge Chief Justice

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Alok/Aadil

Devika Sahu v. State of Chhattisgarh

Case brief

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Devika Sahu v. State of Chhattisgarh

Case brief

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