The Bombay High Court addressed the legal validity of the cancellation of an earlier tender for the Dharavi Redevelopment Project by the Maharashtra Government, followed by the issuance of a fresh tender incorporating railway lands. The Court examined claims of arbitrariness, procedural lapses, and bias in tender conditions, juxtaposed against public interest concerns.

The Court upheld the government’s decision to re-tender, citing the material change in project scope due to the inclusion of railway lands and concluded that such action was within its discretion to ensure public interest and feasibility of the project.

Acts and Sections Discussed:

1. Constitution of India:

   • Article 14: Equality before the law - Petitioner argued arbitrariness in tender cancellation.
   • Article 226: Judicial review of executive actions by the High Court.

2. Indian Contract Act, 1872:

   • Applicability of concluded contracts principles.

3. Civil Procedure Code, 1908:

   • Section 44A: Enforcement of foreign decrees relevant to Bilateral Investment Promotion and Protection Agreement (BIPPA) considerations.

1. Introduction and Challenge (Para 1-8)

• Heading: "Cancellation and Re-Tendering of Dharavi Project"
  The petitioner, SecLink Technologies Corporation, challenged the government’s decision to cancel a previously awarded tender for the Dharavi Redevelopment Project, citing unfair re-tendering conditions and bias.

2. Historical Background (Para 9-20)

• Heading: "Chronology of Dharavi Redevelopment"
  The project initiated in 2004 with significant policy decisions in subsequent years. The 2018 tender process was cancelled citing procedural and scope changes, particularly involving railway lands.

3. Procedural Developments (Para 21-30)

• Heading: "Government’s Rationale for Cancellation"
  The government argued the inclusion of railway lands necessitated changes in the project structure, making the earlier tender terms unviable.

4. Petitioner’s Contentions (Para 30-43)

• Heading: "Claims of Arbitrariness and Bias"
  The petitioner contended that the earlier tender was legally binding, alleging bias in re-tender terms aimed at favoring specific entities.

5. Respondent’s Arguments (Para 44-60)

• Heading: "Public Interest and Material Change"
  Respondents emphasized public interest and feasibility concerns, asserting that changes to the tender terms were justified.

Ratio Decidendi:

The Court concluded that:

1. Cancellation of the earlier tender was justified due to the material alteration in the project’s scope with the inclusion of railway lands.
2. Re-tendering was necessary to align with public interest and ensure a competitive and viable bidding process.
3. The procedural steps in the tender process, including consultation with relevant authorities, were adhered to.

Subjects:

• Urban Redevelopment
• Public Procurement
• Government Contracts
• Judicial Review
• Arbitration
• Public Interest