Case Note & Summary
The petitioner, M/s. Venkatesh Trading Company, challenged the order of the Minister of Food, Civil Supplies and Consumer Protection dated 16/8/2010, which set aside the award of a transportation contract to the petitioner by the Additional Collector, Nagpur. The Additional Collector had floated a tender for transportation of sugar from sugar factories to government godowns for a period of three years from 1/6/2010 to 31/5/2013. On 30/6/2010, the petitioner was the only tenderer found technically qualified; the other three were disqualified. The Additional Collector, exercising powers under Government Resolution dated 2/6/2010, issued a notification on 1/7/2010 ordering a retender to extend time by 15 days. However, the Minister set aside the award and directed that the price bids of respondent nos.5 and 6 be opened. The High Court held that the Additional Collector's decision to award the contract to the sole qualified bidder was valid and the Minister's order was arbitrary, without any justification, and violated the petitioner's legitimate expectation. The court quashed the Minister's order and directed that the contract be awarded to the petitioner.
Headnote
A) Tender Law - Award of Contract - Single Qualified Bidder - The Additional Collector, after finding only one technically qualified bidder, awarded the contract to the petitioner. The Minister set aside this award and ordered retender. The High Court held that the Additional Collector's decision to award the contract to the sole qualified bidder was valid and the Minister's order was arbitrary and without justification. (Paras 1-10) B) Administrative Law - Legitimate Expectation - Retender - The petitioner had a legitimate expectation that the contract would be awarded to him as the sole qualified bidder. The Minister's order for retender without any valid reason violated this expectation and was set aside. (Paras 5-10) C) Government Contracts - Tender Conditions - Clause 2.2.E - The clause allowing retender if less than 3 valid bids are received was not applicable as the Additional Collector had already exercised his power to extend time and order retender. The Minister's interference was unwarranted. (Paras 3-8)
Issue of Consideration
Whether the Minister was justified in setting aside the award of contract to the petitioner and ordering retender when only one technically qualified bidder existed, and whether the Additional Collector's decision to award the contract to the sole qualified bidder was valid.
Final Decision
The High Court allowed the petition, quashed the Minister's order dated 16/8/2010 and the consequential letter dated 17/8/2010, and directed that the contract be awarded to the petitioner in accordance with the Additional Collector's decision.
Law Points
- Tender Law
- Government Contracts
- Legitimate Expectation
- Judicial Review of Administrative Action
- Retender Conditions
