Successful bidders under a BMTC tender for stalls sought conversion of allotted fruit, book and mobile stalls into general stalls; BMTC cancelled the allotments. The court held bidders could not exploit an error in the tender document and the arbitration clause did not apply to cancellation, dismissing the writ petition.
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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 20TH DAY OF SEPTEMBER, 2024
BEFORE
THE HON'BLE MR JUSTICE HEMANT CHANDANGOUDAR
WRIT PETITION NO. 25776 OF 2023 (GM-TEN)
BETWEEN:
Digitally signed by R HEMALATHA Location: HIGH COURT OF KARNATAKA
…PETITIONERS
(BY SRI SATISH B DODDAMANI, SR. COUNSEL FOR SRI SAGAR B B, ADVOCATE)
NC: 2024:KHC:38849 WP No. 25776 of 2023
AND:
…RESPONDENTS
(BY SRI B S SHRINIVAS, ADVOCATE)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASHING THE IMPUGNED ORDERS VIDE ANNX-D BEARING NO. BEM MA SAA SAM/KEK /SAM/VAA 1516/1683/2023-24 DTD 04.11.2023 PASSED BY R-2 AND ETC.
THIS PETITION, COMING ON FOR HEARING ON IA THIS DAY, ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE HEMANT CHANDANGOUDAR
ORAL ORDER
The second respondent floated a tender document dated 24.08.2023 inviting bids for the grant of a license to run general stalls (open spaces at various bus stations of BMTC). The petitioners submitted their bid and were declared successful bidders, receiving allotment letters granting licenses to operate a fruit stall, book stall, and mobile stall. The license was valid for a period of six years. Subsequently, the petitioners submitted a representation to the second respondent, stating that they had been allotted a fruit stall instead of a general stall. They requested
the second respondent to convert the fruit stall/book stall/mobile stalls to general stalls. In response, the second respondent issued the impugned orders cancelling the allotment of the said stalls made in favor of the petitioners and refunded the earnest money deposited. Taking exception to these discrepancies, learned counsel Sri Satish B. Doddamani, representing the petitioners, submitted that the tender notification invited bids for the allotment of general stalls, and therefore, the successful bidders are entitled to allotment of general stalls. He argued that the cancellation without proper notice was contrary to the conditions contained in the tender documents and violated the principles of natural justice. He further submitted that Clause 41 of the tender document provides for invoking the arbitration clause in the event of a dispute between the parties, and therefore, the cancellation of the allotment without invoking the arbitration clause is arbitrary and discriminatory.
event of a dispute arising after the contract is awarded and not in the case of cancellation of the allotment. Therefore, the submission of the learned counsel for the petitioners that the impugned order cancelling the allotment without invoking the arbitration clause lacks merit.
NC: 2024:KHC:38849 WP No. 25776 of 2023
vacating the interim order does not survive for consideration and is accordingly disposed of.
W.P. No. 10535/2024 is de-linked.
Sd/-
(HEMANT CHANDANGOUDAR) JUDGE
CHS List No.: 1 Sl No.: 67
2 issues framed by the court
Were the petitioners, successful bidders for fruit/book/mobile stalls, entitled to conversion into general stalls on the ground that the tender invited bids for general stalls?
Was the cancellation of the stall allotments without invoking the tender's arbitration clause (Clause 41) arbitrary or in violation of natural justice?
1 provisions across 1 enactments
Smt. Kavitha N.M
Sri. N. Venkatesh
Sri Manjunath M
The Managing Director, BMTC
The Chief Traffic Manager (COM), BMTC
Hemant Chandangoudar
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
