Case Note & Summary
The petitioner, M/s Drushti Engineers & Developers, a partnership firm, filed a writ petition under Articles 226 and 227 of the Constitution of India before the Bombay High Court, Aurangabad Bench, challenging a communication dated 29 May 2012 issued by respondent No.3, National Textile Corporation Limited (Western Region), which cancelled the e-tender process initiated on 24 February 2011 for the sale of freehold land bearing City Survey No.20666 of Aurangabad Textile Mills, Aurangabad. The petitioner sought a writ of certiorari to quash the impugned communication and a writ of mandamus directing the respondents to conclude the sale proceedings in its favour. The respondents included the Union of India, Aurangabad Textile Mills (a unit of National Textile Corporation), and National Textile Corporation Limited. The petitioner argued that it was the highest bidder and had complied with all tender conditions, and that the cancellation was arbitrary and malafide. The respondents contended that the tender was cancelled due to non-compliance with terms and that the petitioner had no vested right to acceptance. The court, after hearing counsel for both sides, held that the petitioner failed to demonstrate any legal right to compel the conclusion of the sale. The court observed that the tendering authority has the discretion to cancel the tender for valid reasons, and the petitioner's bid was not accepted. The court dismissed the petition, finding no merit in the challenge to the cancellation. The judgment was delivered by a division bench comprising Chief Justice Dipankar Datta and Justice Ravindra V. Ghuge, with the latter authoring the judgment. The court ruled that the writ petition was devoid of merits and dismissed it, with no order as to costs.
Headnote
A) Constitutional Law - Writ Jurisdiction - Contractual Matters - Scope of judicial review under Article 226 of the Constitution of India in tender matters is limited to cases of arbitrariness, mala fides, or violation of statutory provisions; courts do not sit in appeal over commercial decisions. (Paras 1-3) B) Contract Law - Tender - No Vested Right - A bidder in a tender process has no vested right to have the tender accepted; the tendering authority retains the right to cancel the tender for valid reasons, including non-compliance with terms. (Paras 3-5) C) Public Property - Disposal - National Textile Corporation - The disposal of public property by a government undertaking must be transparent and in public interest; however, the court cannot direct conclusion of sale if the tender process was flawed. (Paras 2-6)
Issue of Consideration
Whether the petitioner has a legal right to compel the respondents to conclude the sale proceedings initiated pursuant to an e-tender, and whether the impugned communication cancelling the tender is arbitrary and illegal.
Final Decision
The writ petition is dismissed. No order as to costs.
Law Points
- Writ jurisdiction under Article 226
- Contractual rights
- Tender cancellation
- No vested right to tender acceptance
- Public interest in disposal of public property
