Gujarat High Court
Kishorebhai Pranlal Bhut vs State Of Gujarat on 18 November, 2025
Author: Bhargav D. Karia
Bench: Bhargav D. Karia
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 623 of 2025
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR.JUSTICE L. S. PIRZADA
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Approved for Reporting Yes No
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KISHOREBHAI PRANLAL BHUT
Versus
STATE OF GUJARAT & ORS.
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Appearance:
MR DHAIRYAWAN D BHATT(11817) for the Petitioner(s) No. 1
MR MITRAJEET SHUKLA, AGP for the Respondent(s) No. 1,2
MR HS MUNSHAW(495) for the Respondent(s) No. 3,4
NOTICE SERVED for the Respondent(s) No. 5
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CORAM:HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR.JUSTICE L. S. PIRZADA
Date : 18/11/2025
ORAL JUDGMENT
(PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA)
1. Heard learned advocate Mr. Dhairyawan D. Bhatt for
the petitioner, learned Assistant Government Pleader Mr.
Mitrajeet Shukla for respondent Nos. 1 and 2, and
learned advocate Mr. H. S. Munshaw for respondent Nos.
3 and 4.
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2. By this petition under Article 226 of the Constitution
of India, filed on 11.01.2025, the petitioner has prayed for
the following reliefs:
"(A)The Hon'ble Court be pleased to issue
an order, writ in the nature of certiorari
and/or other appropriate writ, order or
direction, declaring the that Clause No. 11,
sub-clause No. 4 prescribing Financial
Status in Request for Proposal for
procurement of Medals Additional Terms &
Condition and Specifications published by
Sports Authority of Gujarat is irrational,
arbitrary and is therefore bad in law.
(B)The Hon'ble Court be pleased to declare
Clause No. 7.2 Exemption, sub-clause-II is
unjust, arbitrary, irrational, discriminatory
and violative Article 14, 19. 21 of the
Constitution of India and be pleased to
quash and set aside the same and be
pleased to direct the respondents to
consider the bid of petitioner, in accordance
with law.
(C) Pending admission, hearing and final
disposal of the petition, this Hon'ble Court
be pleased to direct respondents to consider
the bid placed by petitioner and further
direct respondents from awarding any
tender."
3. Brief facts of the petition are as follows:
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3.1 The petitioner is engaged in manufacturing of
Mementos, Presentation Articles, Gift Articles in Silver
and Gold and its supply. It is the case of the petitioner
that respondent No. 4 published a tender notice with a
Request for Proposal for Procurement of Medals for the
Khel Maha Kumbh to be held in March 2025. The tender
for purchase of medals and trophies was issued on
31.12.2024 and the last date for submission of bids was
15.01.2025. The petitioner, in response to the tender
notice, submitted its financial bid/quotation on
13.01.2025. However, after affirming this petition on
11.01.2025, the petitioner inserted the date '13.01.2025'
in a blank space kept in paragraph 4.3 of the affirmed
petition. When a query was put to the learned advocate
for the petitioner, it was pointed out that the petition was
presented before the Registry on 13.01.2025, and at that
point of time the date was inserted in the blank space in
paragraph 4.3 of the memo of the petition.
4. We are of the opinion that once the memo of the
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petition was affirmed on 11.01.2025, and without there
being any order passed by the Court permitting
amendment, no amendment could have been made in the
affirmed copy of the petition. Therefore, the date inserted
in paragraph 4.3 is nothing but tampering with the
affirmed copy of the petition presented before the
Registry on 13.01.2025.
5. The petitioner during filing of the petition had
initially challenged Clause No. 11, Sub-clause No. 4 of the
tender conditions, which prescribes the financial status in
the Request for Proposal for Procurement of Medals.
According to the petitioner, in pursuance of the 'Make in
India' initiative by Government of India, Government of
Gujarat has framed a Procurement Policy whereby local
manufacturers like the petitioner would be given priority
in awarding tenders. As per the Procurement Policy of
Government of Gujarat, 2024, impetus is given to Micro,
Small and Medium Enterprises, Women and Startups of
the State so as to enable them to participate in
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Government purchases for providing goods and services
to various Government Organisations. Accordingly,
respondent No. 4 - Sports Authority of Gujarat - issued
the 'Request for Proposal for Procurement of Medals'
along with Additional Terms and Conditions and
Specifications. The tender for purchase of medals and
trophies stipulates Clause No.11 prescribing the financial
status for eligibility criteria for bidders, including Sub-
clauses (4) and (6) relating to experience. It is the case of
the petitioner that the requirement of financial status and
experience eligibility criteria is contrary to the Startup
India Programme. The petitioner, therefore, raised
objections in the pre-bid meeting held on 03.01.2025 and
thereafter made a written representation on 10.01.2025
before the Hon'ble Chief Minister of Gujarat and the
Hon'ble Minister of State (Sports and Youth Service and
Coordination of Voluntary Organisation, Government of
Gujarat), stating that prescribing minimum annual
turnover only for Micro, Small and Medium Enterprises is
arbitrary, irrational and illegal.
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6. According to the petitioner, the eligibility criteria in
similar tender for the financial year 2023-24 required
was 50% of the amount of the contract as turnover,
whereas Clause No.11 of the tender conditions
prescribes the minimum average annual turnover equal to
twice the estimated cost of the tender for the previous
three financial years, certified by a Chartered
Accountant. It also provides for completion of similar
services over the last three years, i.e. the current
financial year and the last three financial years (ending
month of March prior to the bid opening) as following: (i)
Three similar completed services equal to 40% of the
estimated cost; (ii) two similar completed services costing
not less than the amount equal to 50% of the estimated
cost; or (iii) one similar completed service costing not less
than the amount equal to 80% of the estimated cost. It
was submitted that the petitioner, therefore, challenged
these conditions when the petition was filed.
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7. It appears that the petitioner was not heard for one
reason or another till 22.04.2025, and thereafter, during
the course of hearing in the month of April, it appears
that a statement was made on behalf of respondents Nos.
3 and 4 that the tender had been awarded to the newly
joined respondent No. 5 - Gujarat State Handloom and
Handicraft Development Corporation - during the
pendency of the petition. The petitioner, therefore, filed
Civil Application (For Amendment) No. 1 of 2025, seeking
substitution of the prayers in the petition, which was
allowed by order dated 05.05.2025 passed by this Court.
Respondent No. 5 was also joined as a party in terms of
the prayer made in Civil Application (for joining of party)
No. 2 of 2025. Accordingly, paragraph 7 containing the
prayers was substituted as under:
"A) The Hon'ble Court be pleased to issue
an order, writ in the nature of certiorari
and/or other appropriate writ order or
direction, declaring the that action of
Respondents in issuing worder in favor
Gujarat State Handloom and Handicrafts
Development Corporation Ltd is irrational,
arbitrary and is therefore bad in law.
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(B) The Hon'ble Court be pleased to
declare action of Respondents in issuing
Work Order in favor of Gujarat State
Handloom and Handicrafts Development
Corporation Ltd is unjust. arbitrary.
irrational, discriminatory and violative
Article 14, 19, 21 of the Constitution of
india and be pleased to quash and also set
aside the same and be pleased to direct the
respondents to consider the bid of
petitioner, in accordance with law.
(C) Without prejudice to relief as prayed
hereinabove and in alternative. This
Hon'ble Court be pleased to award
compensation at 20% of the tender value or
at any other rate as it may deem
appropriate in facts of the case at running
interest of 9% p.a. from date of Work Order
till realization, towards loss suffered by
present petitioner for the aforesaid
arbitrary. irrational and unreasonable
action on part of Respondents and further
direct Respondents jointly or severally to
deposit the same.
(D) Any other and further relief this
Honorable Court deem fit and proper, in
interest of justice."
8. The main reason for amending the petition was that
respondent No. 5 was awarded the contract and issued
the Work Order during the pendency of the petition
without inviting any tenders, which was contrary to the
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Policy of respondent No. 4. It was submitted that as per
the Gujarat State Procurement Policy, 2024 (for short 'the
Policy') dated 14.03.2024, purchases without tender can
be made from respondent No. 5 only up to Rs.15 lakhs,
whereas respondent No. 4 has awarded a Work Order of
more than Rs.45 lakhs, which is in breach of Clause 8 of
the Policy. Therefore, it was prayed by the petitioner that
the action of the respondents in issuing the Work Order
in favour of respondent No.5 be declared irrational,
arbitrary and bad in law. The petitioner also prayed to set
aside the said Work Order and to direct the respondents
to consider the bid of the petitioner in accordance with
law, or in alternative, to award compensation at the rate
of 20% of the tender value or at such other rate as may
be considered appropriate, with running interest at 9%
per annum from the date of the Work Order till
realisation.
9. Learned advocate Mr.Dhairyawan D. Bhatt
appearing for the petitioner submitted that the petitioner
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was initially aggrieved by Clause No. 11, Sub-clause (4) of
the tender conditions, which stipulated the financial
status for the bidders, and that the petitioner ought to
have been given the same exemption as provided under
Condition No. 7.2 of the tender conditions applicable to
Micro, Small and Medium Enterprises. It was submitted
that during the pendency of this petition, respondent No.
4, contrary to the Policy, issued the Work Order to
respondent No. 5. As per Clause 8(B) of the Policy,
purchases without tender can be made only up to Rs.15
lakhs, whereas the Work Order in question is for more
than Rs.45 lakhs. It was therefore submitted that the
respondent authorities have violated the Policy, and
hence the Work Order issued by respondent No.4 in
favour of respondent No.5 is required to be quashed and
set aside.
10. It was further submitted that the petitioner is a
Micro and Small Scale Enterprise and therefore the
exemption provided under Clause 7.2 of tender
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conditions, granting exemption for Tender Fee and EMD,
ought to have been extended to its financial status as
well. However, during the pendency of the petition, the
respondent, in order to frustrate the prayers made by the
petitioner, has given a complete go-by to the Policy by
purchasing the medals from respondent No. 5, even
though the purchases exceed Rs.15 lakhs. It was
therefore submitted that the purchases made by
respondent No. 4 from respondent No. 5, a Governmental
Organisation, are liable to be quashed and set aside, as
the same were made without inviting any tender.
11. In support of his submissions, reliance was placed
on the decision of the Hon'ble Apex Court in case of
Nagar Nigam, Meerut v. Al Faheem Meat Exports Pvt.
Ltd. reported in 2006 LawSuit (SC) 1141. It was
submitted that in the said case, the Hon'ble Apex Court,
while considering the issue of public auction vis-a-vis
private negotiations, has held as under:
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"[13] This Court time and again has
emphasized the need to maintain
transparency in grant of public contracts.
Ordinarily, maintenance of transparency as
also compliance of Article 14 of the
Constitution would inter alia be ensured by
holding public auction upon issuance of
advertisement in the well known
newspapers. That has not been done in this
case. Although the Nagar Nigam had
advertised the contract, the High Court has
directed that it should be given for 10 years
to a particular party (respondent No. 1).
This was clearly illegal.
[14] It is well settled that ordinarily the
State or its instrumentalities should not
give contracts by private negotiation but by
open public auction/tender after wide
publicity. In this case the contract has not
only been given by way of private
negotiation, but the negotiation has been
carried out by the High Court itself, which
is impermissible.
[15] We have no doubt that in rare and
exceptional cases, having regard to the
nature of the trade or largesse or for some
other good reason, a contract may have to
be granted by private negotiation, but
normally that should not be done as shakes
the public confidence.
16] The law is well-settled that contracts by
the State, its corporations instrumentalities
and agencies must be normally granted
through publi auction/public tender by
inviting tenders from eligible persons and
the notificatiol of the public-auction or
inviting tenders should be advertised in
well known dailies having wide circulation
in the locality with all relevant details such
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as date, time and place of auction, subject-
matter of auction, technical specifications,
estimated cost, earnest money Deposit, etc.
The award of Government contracts
through public-auction/public tender is to
ensure transparency in the public
procurement. to maximise economy and
efficiency in Government procurement, to
promote healthy competition among the
tenderers, to provide for fair and equitable
treatment of all tenderers, and to eliminate
irregularities, interference and corrupt
practices by the authorities concerned. This
is required by Article 14 of the Constitution.
However, in rare and exceptional cases, for
instance during natural calamities and
emergencies declared by the Government:
where the procurement is possible from a
single source only; where the supplier or
contractor has exclusive rights in respect of
the goods or services and no reasonable
alternative or substitute exists: where the
auction was held on several dates but there
were no bidders or the bids offered were
too low, etc., this normal rule may be
departed from and such contracts may be
awarded through 'private negotiations'. See
Ram and Shyam Company V/s. State of
Haryana and Others, AIR 1985 SC 1147.
"[18] The law is, thus, clear that ordinarily
all contracts by the Government or by an
instrumentality of the State should be
granted only by public auction or by
inviting tenders, after advertising the same
in well known newspapers having wide
circulation, so that all eligible persons will
have opportunity to bid in the bid, and
there is total transparency. In our opinion
this is an essential requirement in a
democracy, where the people are supreme,
and all official acts must be actuated by the
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public interest, and should inspire public
confidence."
12. Referring to the decision of the Hon'ble Apex Court
in M/s. Indian Medicines Pharmaceuticals Corporation
Ltd. v. Kerala Ayurvedic Co-operative Society Ltd. & Ors.,
reported in 2023 LiveLaw (SC) 6, it was submitted that
the process of inviting tenders can be given a go by, by
the authority in exceptional cases, such as situations
arising out of natural calamities. Reliance was placed on
the observations made by the Hon'ble Supreme Court in
the said case, wherein it has been held as under:
"20 Inviting tenders and conducting public
auctions are considered to be preferred
methods of allocation for two reasons:
firstly procurement can be made at the
best price; and secondly, allocation is
through a transparent process. However, if
the purpose of allocation by the State is
not revenue maximization, the State could
award contracts through other methods,
provided it is non-arbitrary and meets the
requirements of Article 14.
22. The following principles emerge
from the discussion above:
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(i) Government action must be just, fair
and reasonable and in accordance with the
principles of Article 14; and
(ii) While government can deviate from the
route of tenders or public auctions for the
grant of contracts, the deviation must not
be discriminatory or arbitrary. The
deviation from the tender route has to be
justified and such a justification must
comply with the requirements of Article
14."
13. In support of the submission that the petitioner is
entitled to compensation, reliance was placed on the
decision of the Hon'ble Apex Court in Subhash Projects
and Marketing Limited Vs. West Bengal Power
Development Corporation Ltd., reported in 2005 LawSuit
(SC) 1421. In the facts of the said case, the Hon'ble
Supreme Court held that when different yardsticks were
applied at different stages and the Ministry/State
persisted in raising objections only until the appellant
was found to be the lowest tenderer, such conduct
appeared strange, and therefore no interference was
called for. Consequently, the Hon'ble Apex Court declined
to interfere with the award of compensation. Hon'ble
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Apex Court in the said judgment held as under:
"11. We were taken elaborately through a
large number of documents including the
Valuation process undertaken by the
Evaluation committee and the opinions
expressed by the other responsible bodies
and a reappraisal of those materials, only
supports the conclusion of the Division
bench on the matters in controversy. It
may be noticed that the learned single
judge had also rejected the contentions of
subhash Projects, and had held that it
was difficult to understand as to how the
Power corporation overlooked the
original defect in the tender of Subhash
Projects which included a price variation
clause and not a firm price as stipulated
and how it held negotiations only with it
at the price bid stage when Subhash
Projects admittedly lowered its bid so as
to make its offer nearer to the offer of L
and T. despite the restriction in that
regard as contained in oecf letter dated
1.7.1996 made much of to support the
contract given to it and how subhash
Projects was permitted to enter into sub-
contracts with other contractors, and that
too, even prior to the entering into an
agreement by Subhash Projects itself.
The learned single Judge had also found
that in any event, price variation became
necessary in view of the alterations,
amendments and clarifications to the
tender schedule. The Division Bench had,
by and large, agreed with that finding.
These findings are seen to be justified on
the materials available on record and
there is no justification in this Court
interfering with those findings in these
appeals. Thus, it was a case where
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different yardsticks were being used at
different stages and the persistence of
the Ministry of State for Power in raising
objections until Subhash Projects was
chosen as the lowest tenderer does look
strange."
14. Reliance was also placed on the judgment of the
Hon'ble Supreme Court in the case of Power Carriers
(India) Private Limited v. Shri G.M. Lanong and Others,
reported in 2016 SCC OnLine Megh 314, wherein the
Apex Court has held as under:
"36. Though the aforesaid decisions have
no direct application to the facts of the
present case but, in a summation of the
principles therein, it is noticed that the
method of open invitation to offer is
generally accepted to be preferable
method for award of the contract by the
State and its agencies that ensures
fairness and transperacy but, departure
therefrom, by itself, is not of illegality, if
the departure is based on some valid and
rational principles and conforms to the
requirements of fairness and
reasonableness. However, a blithe
deviation is considered intolerable by the
Courts, the ultimate test being that of
fairness of decision-making process and
adequate compliance of Article 14 of the
Constitution of India.
37. While keeping the principles
aforesaid in view, it could now be
examined if the impugned interrelated
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actions of the appellant-Board i.e, of
cancelling the process under the NIT
dated 01.03.2006; and of departure from
the normal rule of inviting tenders while
awarding the contract to the appellant-
Company stand the relevant tests of
reasonableness, rationality, fairness and
transparency.
40. In a desperate attempt to somehow
justify this questionable abandonment,
the appellants have attempted to suggest
that there had been a so called change of
Policy decision by the Board because of
various technical and financial
requirements that instead of going ahead
with 220 KV towers, the construction
shall be of 132 KV towers. Such a
suggestion has its own shortcomings and
pitfalls. In the first place, it is difficult to
find from the material placed on record if
such a Policy decision was indeed taken
before issuance of the aforesaid letter
dated 23.03.2007 conveying
abandonment of the tender process due
to 'unavoidable circumstances'.
Secondly, it is noticed that after such
abandonment, it was proposed on
20.04.2007 that the appellant-Company
be awarded the work of 'Construction of
132 KV double circuit line from Myntdu
Leshka HEP to the 132 KV Khliehriat
S/S'. The same particulars were stated in
the Work Order dated 16.05.2007. The
specifications of towers were nowhere
stated in those propositions. It appears
from the material placed on record that
only after such placing of the Work
Order that the Member Technical of the
Board prepared the Agenda Note dated
14.06.2007 (Annexure-5) suggesting as if
construction KV Towers was not
considered technically and financially
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feasible. Only thereafter, Board
purportedly ratified the award of the
work 'for construction/erection of 132 KV
line on 132 KV double circuit towers
from MLHEP-I to the 132 KV Khliehriat
Sub-Station' in its meeting dated
15.06.2007.
46. In an attempt to justify the award of
work to the appellant-Company without
invitation to offers, it has been
strenuously argued that the project in
question was that of public utility and
was time bound; and that the same
would have been jeopardized by
invitation of such offers. This justification
is also nothing but a hollow pretext. As
noticed, for this work, an NIT was issued
earlier in the month of March, 2006 but
the process itself dragged on for an
inordinate length of time and in fact, the
respondent, who was one of the bidders
and was sought to be disqualified, made
his protest in the month of November,
2006 whereupon, he was requested to
submit certain documents; and the
respondent indeed submitted the
documents in the month of December,
2006. Thereafter, the appellant-Board
chose to sit over the matter for another
three months and then, cancelled the
tender process only in the month of
March, 2007. As noticed, no plausible
reason for scrapping of the said process
has been brought on record. If at all it
were a matter of urgency, it is left to
everyone's guess as to why the earlier
tender process was kept pending for
more than one year and then, why the
same was scrapped at all? In this regard,
again, even if we assume that scrapping
of earlier tender process was not an
oblique decision, it is difficult to find any
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rationale or any justification that after
scrapping, the appellant-Board suddenly
found it to be a matter of urgency and
then, chose to offer the work to the
appellant-Company without adopting any
such method which would have ensured
competitive biddings.
51. In the ordinary course, the
consequence of the findings against the
validity of the process in question would
have been of setting it aside but then, it
cannot be said that as a further
consequence thereof, the work would
have been awarded to the respondent
alone. Then, the fact of the matter had
been that even when the writ petition
was filed, a substantial part of the work
in question had already been executed
and by the time the writ petition was
decided, the execution was complete. In
the given set of facts and circumstances,
though the respondent could be
considered as one of the potential
bidders who had indeed offered the bid
earlier and who might have been
interested in offering the bid if tenders
were floated afresh but then, it is
difficult to say that the respondent alone
would have the only person entitled to be
awarded the contract in question. Taking
an overall view of the matter, we are of
the view that only a reasonable amount
of compensation could have been
considered available for the respondent
(writ petitioner) and not beyond."
15. It was, therefore, submitted that in view of the above
settled legal position, the award of the Work Order in
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favour of respondent No. 4 is liable to be quashed and set
aside. Further, as the tender process has already
concluded and the Work Order has also been fully
complied with, as stated on oath by the respondents, the
petitioner is entitled to be granted adequate
compensation, in terms of the principles laid down by the
Hon'ble Apex Court, along with interest at the rate of 9%
per annum.
16. On the other hand, learned advocate Mr. H. S.
Munshaw, appearing for respondent Nos.3 and 4,
submitted that it is not in contest that the Work Order
was issued to respondent No. 5 without inviting tenders,
the concerned entity being a Government organization.
However, he heavily relied upon the averments made in
the affidavit-in-reply, which depicts the circumstances
under which the Work Order was given after obtaining
permission from the State Government for deviation from
the Policy in the facts of the case.
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17. Learned advocate Mr. Munshaw invited the
attention of the Court to the affidavit filed on behalf of
respondent No. 4 in April 2025, wherein the following
averments are made:
"1. The respnt. No.4 most respectfully
submits that the petitioner herein has
preferred present Special Civil
Application with a prayer to declare that
the Clause-11, Sub-Clause No.4
prescribing Financial Status in Request
For Proposal for Procurement of Medals,
Additional Terms and Conditions and
Specifications published by Sports
Authority of Gujarat as irrational,
arbitrary and bad in law. The petitioner
has further prayed that the Hon'ble
Court further be pleased to declare
Clause 7.2, Exemption, Sub-Clause-2 as
unjust, arbitrary, irrational and
discriminatory and therefore the same
be quashed and set aside and therefore
the petitioner is required to be
considered eligible in accordance with
law. The respnt. no.4 has filed a detailed
Affidavit in Reply and contended that the
petitioner herein is not entitled to any
relief in view of the facts and material on
record.
2. The respnt. no.4 submits that pending
the present Speudi Civil Application, it
has been decided to purchase Medals
and Trophies from Gujarat State
Handicraft and Handloom Development
Corporation Ltd., a Govt. of Gujarat
Enterprise and even a Work Order is also
issued on 7.2.25 and a copy thereof is
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annexed as ANNEXURE-A. In other
words present Special Civil Application
has become infructuous as purchases is
to be made from Govt.Corporation in
stead of private supplier and therefore
Hon'ble Court is most respectfully
prayed not to grant any interim relief
and reject the present Special Civil
Application in limine with cost in the
interest of justice."
18. Learned advocate Mr. Munshaw also invited the
attention of the Court to the averments made in the
further affidavit-in-reply filed on behalf of respondent No.
4, which reads as under:-
"1. The respnt.No.4 most respectfully
submits that the petitioner herein has
preferred present Special Civil
Application with a prayer to declare that
the Clause-11, Sub-Clause No.4
prescribing Financial Status in Request
For Proposal for Procurement of
Medals, Additional Terms and
Conditions and Specifications published
by Sports Authority of Gujarat as
irrational, arbitrary and bad in law. The
petitioner has further prayed that the
Hon'ble Court further be pleased to
declare Clause 7.2, Exemption, Sub-
Clause-2 as unjust, arbitrary, irrational
and discriminatory and therefore the
same be quashed and set aside and
therefore the petitioner is required to be
considered eligible in accordance with
law. The respnt. no.4 has filed a detailed
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Affidavit in Reply and contended that
the petitioner herein is not entitled to
any relief in view of the facts and
material on record.
2. The respnt. no.4 submits that pending
the present Special Civil Application, as
stated in Further Affidavit in Reply duly
affirmed on 4.4.25, a decision to
purchase Medals and Trophies from ,
Gujarat State Handicraft and Handloom
Development Corporation Ltd., A Govt.
of Gujarat Enterprise is taken and even
Work Order is also issued on 7.2.25 and
the same is satisfactory fulfilled. At this
stage it is submitted that prior to
placement of Work Order, a due
procedure was followed and the file was
moved up to the Principal Secretary,
Sports, Youth and Cultural Activities
Dept. as well as Minister of Sports,
Youth and Cultural Activities Dept. for
approval and pursuant to approval a
Work Order dated 7.2.25 was issued in
favour of Gujarat State Handicraft and
Handloom Development Corporation
Ltd. and copies of Noting Section as
well as Work Order are annexed as
ANNEXURE-A & B respectively."
19. Pursuant to the orders passed by this Court, and
referring to the above averments, learned advocate
Mr.Munshaw submitted that since the petitioner had
already filed the present petition, the State Government
as well as respondent No. 4, in consultation with and with
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approval of the State Government considered it
appropriate to proceed with the purchase of medals for
the 'Khel Maha Kumbh 3.0', which was already in
progress and scheduled to conclude in March 2025. It
was submitted that there was an urgency, and therefore
necessary approval was granted on the proposal made by
respondent No.4 by the Principal Secretary on
05.02.2025 and by the concerned Minister on 06.02.2025.
Thereafter, the Work Order was issued in favour of
respondent No.5 by taking into consideration the
deviation permitted from the Policy regarding purchase of
medals exceeding Rs. 15 lakhs from a Government
organization. It was submitted that no malafide is alleged
against the respondents by the petitioner, except the
allegation of breach of the 2024 Policy. The decision was
taken by respondent No. 4 in consultation with
respondent Nos. 1 to 3, in public interest, so as to ensure
that medals would be available in time for the conclusion
of the Khel Maha Kumbh in March 2025. In support of his
submissions, reliance was placed on the decisions of the
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Hon'ble Apex Court in Galaxy Transport Agencies,
Contractors, Traders, Transports and Suppliers v.
New J.K. Roadways, Fleet Owners and Transport
Contractors and Others, reported in (2021) 16 SCC
808, and National High Speed Rail Corporation
Limited v. Montecarlo Limited and Another, reported
in (2022) 6 SCC 401.
20. Learned advocate Mr. Munshaw has also placed on
record the original file containing the documents
downloaded and printed from the Government's e-file
system, reflecting the approval granted by the Principal
Secretary and the concerned Minister to make the
purchase without inviting tenders from respondent No. 5,
which is a Government-owned Corporation. The said
approval was granted keeping in view the necessity of
procuring medals for the Khel Maha Kumbh, which was
required to be completed in the month of March 2025.
21. Learned advocate Mr. Munshaw submitted that in
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the case of Galaxy Transport Agencies, Contractors,
Traders, Transports and Suppliers (supra), the Hon'ble
Apex Court has held in paragraph 18 that it is well settled
that unless arbitrariness or mala fides on the part of the
tendering authority are alleged, the expert evaluation of a
particular tender especially with respect to technical
evaluation is not to be second-guessed by a writ court. It
was submitted that the Hon'ble Apex Court, in the facts of
the said case, referred to and relied upon the decision in
Jagdish Mandal v. State of Orissa, reported in (2007) 14
SCC 517, wherein it was held that interference under
Articles 226 of the Constitution is not warranted unless
the answers to the following questions are in the
affirmative: (i) whether the process adopted or the
decision made by the authorities is mala fide or intended
to favour someone; (ii) whether the process or decision is
so arbitrary or irrational that no responsible authority
acting reasonably and in accordance with law could have
arrived at such a decision; and (iii) whether public
interest is affected. It was submitted that, in the facts of
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the present case, none of the above questions can be
answered in the affirmative. On the contrary, the answer
to all of them is in the negative, as the entire process
adopted for procurement of medals was neither mala fide
nor intended to favour anyone. The decision was taken by
respondent No. 4 after obtaining due approval from the
State Government, as is evident from the approvals
granted by the Principal Secretary and the concerned
Minister. Therefore, it cannot be said that the decision is
of such a nature that no responsible authority acting
reasonably and in accordance with the relevant law could
have taken it. It was further pointed out that the decision
was taken in public interest, and no public interest has
been adversely affected, particularly because the
procurement was made from a Government-owned
organization, from which no private individual would
derive any benefit. It was, therefore, submitted that no
interference is called for in respect of the impugned
decision of the respondent authorities to procure medals
from a Government organization without inviting a
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tender. Referring to the decision in National High Speed
Rail Corporation Limited v. Montecarlo Limited and
Another, reported in (2022) 6 SCC 401, it was submitted
that the Hon'ble Apex Court held that once a conscious
decision has been taken by the competent authority, who
is the author of the tender conditions that a bid suffers
from material deviation after considering the relevant
clauses, it is not open for the High Court to interfere with
such a decision in the exercise of its powers under Article
226 of the Constitution of India.
22. It was submitted that, in the facts of the present
case, the initial challenge made by the petitioner to the
tender clause no longer survives in view of the
subsequent decision taken by the respondent authority to
award the Work Order in favour of respondent No. 5. The
said Work Order was duly issued after obtaining proper
approval from the State of Gujarat. Therefore, no mala
fide intention can be attributed to respondent No. 4, as
the deviation from the Policy was approved by the very
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authority which had framed the Policy. Consequently, the
allegations made by the petitioner in the amended
petition are required to be negated.
23. Having heard the learned advocates for the parties
and considering the facts of the case, it appears that the
peititoner has amended the petition without there being
any order passed by the Court after affirmation of the
memo of the petition which is not permissible and
therefore only on that ground the petition is liable to be
rejected. It is not in dispute that the petition was affirmed
by the petitioner on 11.01.2025 and at that point of time
the date in paragraph 4.3 was left blank, which was filled
up after the affirmation, as the filled up date is
13.01.2025. However, this Court also deems it
appropriate to consider the matter on merits. The
petitioner had initially filed the petition challenging
clause 11(4) of the tender conditions relating to financial
status. The petition was presented before the Registry of
this Court on 13.01.2025. Thereafter, the petitioner did
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not bother to pursue the matter till April 2025 and it was
disclosed by the learned advocate for the respondent No.
4 that the Work Order had already been issued in favour
of respondent No. 5, and the work had also been
completed and the petition has become infructuous. This
Court however, permitted the petitioner to amend the
petition by challenging the action of the respondent no. 4
in issuing the Work Order allegedly in violation of the
Policy as the Clause 8 of the Policy clearly stipulates that
a Work Order of more than Rs. 15 lakhs cannot be
awarded to a Government organization without a tender.
In the present case, it is admitted that the Work Order
issued by respondent No. 4 in favour of respondent No. 5
was for approximately Rs. 45 lakhs.
24. At the first glance, it appears that there is a clear
breach and violation of the Policy, as respondent No. 4
has issued the Work Order in contradiction to clause 8(B)
of the Policy. Therefore, the petitioner was permitted to
amend the petition by this Court. In response to the
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amended petition, respondent No. 4 has filed two
affidavits placing on record the circumstances in which
the Work Order came to be issued in favour of respondent
No. 5 after obtaining the appropriate approval from the
State of Gujarat - the framer of the Policy. Accordingly,
this Court, vide order dated 11.11.2025, called upon the
respondents to place on record the original file for
perusal of the Court. During the course of hearing today,
upon perusal of the said file, it appears that respondent
No. 4 had moved a proposal before the State Government
seeking approval for procurement of medals of about Rs.
45 lakhs from respondent No. 5, by requesting deviation
from clause 8(B) of the Policy, which permits
procurement without tender only up to Rs. 15 lakhs from
a Government-owned organization. The reasons given by
the respondent no. 4 is stated in the decision, notings
which are placed on record along with the further
affidavit-in-reply filed by respondent No. 4, the relevant
averments of which have been extracted hereinabove.
Learned advocate Mr. Munshaw has referred to these
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notings, which clearly show that the decision was
approved by the Principal Secretary, Sports, Youth and
Cultural Activities Department, on 05.02.2025 and
thereafter by the concerned Minister on 06.02.2025. Only
after obtaining such approvals the Work Order was issued
on 07.02.2025 for an amount of Rs. 39,79,853/- for the
medals and Rs. 66,700/- for trophies (Annexure-B, page
186).
25. It also appears from the record that the Work
Order refers to the approval granted by the concerned
Minister on 06.02.2025. Therefore, it cannot be said that
the Work Order was issued in violation of the 2024 Policy,
since the approval granted by the State Government
amounts to deviation in the Policy. Considering the facts
of the case, there is nothing on record to indicate that the
decision taken by respondent No. 4, and approved by the
State of Gujarat, is mala fide, or that it is a decision which
no responsible authority acting reasonably and in
accordance with the relevant law could have reached, or
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that such decision adversely affects public interest in any
manner. The Hon'ble Apex Court, in Galaxy Transport
Agencies, Contractors, Traders, Transports and Suppliers
(supra), has referred to and relied upon the decision in
Jagdish Mandal v. State of Orissa (supra), which reads as
under:
"22. Judicial review of administrative
action is intended to prevent
arbitrariness, irrationality,
unreasonableness, bias and mala fides.
Its purpose is to check whether choice
or decision is made "lawfully" and not to
check whether choice or decision is
"sound". When the power of judicial
review is invoked in matters relating to
tenders or award of contracts, certain
special features should be borne in
mind. A contract is a commercial
transaction. Evaluating tenders and
awarding contracts are essentially
commercial functions. Principles of
equity and natural justice stay at a
distance. If the decision relating to
award of contract is bona fide and is in
public interest, courts will not, in
exercise of power of judicial review,
interfere even if a procedural aberration
or error in assessment or prejudice to a
tenderer, is made out. The power of
judicial review will not be permitted to
be invoked to protect private interest at
the cost of public interest, or to decide
contractual disputes. The tenderer or
contractor with a grievance can always
seek damages in a civil court. Attempts
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by unsuccessful tenderers with
imaginary grievances, wounded pride
and business rivalry, to make mountains
out of molehills of some
technical/procedural violation or some
prejudice to self, and persuade courts to
interfere by exercising power of judicial
review, should be resisted. Such
interferences, either interim or final,
may hold up public works for years, or
delay relief and succour to thousands
and millions and may increase the
project cost manifold. Therefore, a court
before interfering in tender or
contractual matters in exercise of power
of judicial review, should pose to itself
the following questions:
(i) Whether the process adopted or
decision made by the authority is
mala fide or intended to favour
someone;
OR
Whether the process adopted or
decision made is so arbitrary and
irrational that the court can say:
'the decision is such that no responsible
authority acting reasonably and in
accordance with relevant law could have
reached;
(ii) Whether public interest is affected.
If the answers are in the negative, there
should be no interference under Article
226. Cases involving blacklisting or
imposition of penal consequences on a
tenderer/contractor or distribution of
State largesse (allotment of sites/shops,
grant of licences, dealerships and
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franchises) stand on a different footing
as they may require a higher degree of
fairness in action."
26. The Hon'ble Apex Court in the case of Montecarlo
Limited v. NTPC, reported in (2016) 15 SCC 272, has also
held as under:
"26. At this stage, it is to be noted that
what can be said to be substantially
responsive technical bid has been
defined under Article 33.2. The High
Court in the impugned order has
observed and held that the bid
submitted by the original writ petitioner
can be said to be substantially
responsive technical bid. However, it is
required to be noted that when the
author of the tender document, in the
present case, JICC/JICA, had taken a
conscious decision that the bid
submitted by the respondent-original
writ petitioner can be said to be non-
responsive and suffering from material
deviation, it was not for the High Court
to consider/opine whether the bid
submitted by the original writ petitioner
is substantially responsive technical bid
or not unless the decision is found to be
perverse and/or suffered from mala
fides and/or favouritism."
27. After referring to and relying upon the above
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decisions, the Hon'ble Apex Court in Galaxy Transport
Agencies, Contractors, Traders, Transports and Suppliers
(supra) held that the interpretation of the tendering
authority, in the facts of that case, could not be said to be
perverse, and that the Court ought not to have interfered
by giving by its own interpretation and not giving proper
credence to the words of the tender conditions. The
Hon'ble Apex Court, in the facts of the case, has therefore
held as under:
"12. Having heard the learned
counsel for the parties, it is first
necessary to set out the NIT's "Terms
and Conditions/Qualifying Criteria".
Conditions 27 and 31 of the NIT,
which are material to this case, state
as follows:
"Terms and conditions/qualifying
criteria
27. The firm/association shall have
working experience of at least five
years with documentary proof and
work should not [be] less [than] 2
crores.
31. The firm/tenderer should have
owned at least 30 nos. of vehicles
both HMV/LMV and attached 200
vehicles with the firm along with
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documentary proof."
13. Even a cursory glance at
Condition 31 of the NIT would show
that the 30 vehicles referred to, are
"both HMV/LMV". The tendering
authority has construed this
condition to mean that both types of
vehicles i.e. HMV and LMV, need to
be included in the list of the 30
vehicles submitted by each bidder.
14. In a series of judgments, this
Court has held that the authority that
authors the tender document is the
best person to understand and
appreciate its requirements, and
thus, its interpretation should not be
second-guessed by a court in judicial
review proceedings. In Afcons
Infrastructure Lid. v. Nagpur Metro
Rail Corpn. Ltd., this Court held:
(SCC p. 825, para 15)
"15. We may add that the
owner or the employer of a
project, having a authored
the tender documents, is the
best person to understand
and appreciate its
requirements and interpret
its documents. The
constitutional courts must
defer to this understanding
and appreciation of the
tender documents, unless
there is mala fide or
perversity in the
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understanding or
appreciation or in the
application of the terms of
the tender conditions. It is
possible that the owner or
employer of a project may
give an interpretation b to
the tender documents that is
not acceptable to the
constitutional courts but that
by itself is not a reason for
interfering with the
interpretation given."
15. In the judgment in Bharat Coking
Coal Ltd. v. AMR Dev Prabhas, under
the heading "Deference to authority's
interpretation", this Court stated:
(SCC p. 776, paras 50-52)
"50. Lastly, we deem it
necessary to deal with
another fundamental
problem. It is obvious that
Respondent 1 seeks to only
enforce terms of the NIT.
Inherent in such exercise is
interpretation of contractual
terms. However, it must be
noted that judicial
interpretation of contracts in
the sphere of commerce
stands on a distinct footing
than while interpreting d
statutes.
51. In the present facts, it is
clear that BCCL and CI-India
have laid recourse to clauses
of the NIT, whether it be to
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justify condonation of delay
of Respondent 6 in
submitting performance
bank guarantees or their
decision to resume auction
on grounds of technical
failure. BCCL having
authored these documents,
is better placed to
appreciate their
requirements and interpret
them. (Afcons Infrastructure
Lid. v. Nagpur Metro Rail
Corpn. Ltd.4, SCC para 15)
52. The High Court ought to
have deferred to this
understanding, unless it was
patently perverse or mala
fide. Given how BCCL's
interpretation of these
clauses was plausible and
not absurd, solely
differences in opinion of
contractual interpretation
ought not to have been
grounds for the High Court
to come to a finding that the
appellant committed
illegality."
16. Further, in the recent judgment
in Silppi Constructions Contractors v.
Union of India, this Court held as
follows: (SCC pp. 502-503, para 20)
"20. The essence of the law laid
down in the judgments referred
to above is the exercise of
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restraint and caution; the need
for overwhelming 9 public
interest to justify judicial
intervention in matters of
contract involving the State
instrumentalities; the courts
should give way to the opinion
of the experts unless the
decision is totally arbitrary or
unreasonable; the court does
not sit like a court of appeal
over the appropriate authority;
the court must realise that the
authority floating the tender is
the best judge of its
requirements and, therefore, the
court's interference should be
minimal. The authority which
floats the contract or tender,
and has authored the tender
documents is the best judge as
to how the documents have to
be interpreted. If two
interpretations are possible then
the interpretation of the author
must be accepted. The courts
will only interfere to prevent
arbitrariness, irrationality, bias,
mala fides or perversity. With
this approach in mind we shall
deal with the present case."
17. In accordance with these
judgments and noting that the
interpretation of the tendering
authority in this case cannot be said
to be a perverse one, the Division
Bench ought not to have interfered
with it by giving its own
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interpretation and not giving proper
credence to the word "both"
appearing in Condition 31 of the NIT.
For this reason, the Division Bench's²
conclusion that J.K. Roadways was
wrongly declared to be ineligible, is
set aside."
28. In the case of National High Speed Rail Corporation
(supra), the Hon'ble Apex Court, while considering the
facts in Montecarlo Limited and Another (supra)
regarding the disqualification of the bidder wherin the
original writ petition filed before the High Court had been
allowed, thereby quashing and setting aside the
communications of disqualification. However, the Hon'ble
Apex Court held that, in the facts of the case, no wrong
had been committed by the Appellant-Corporation in
taking the decision to reject the original writ petitioner's
bid at the technical stage, based on the decision of JICC
Consultant, approved by the Japan International
Consultants Consortium, and further approved by the
Japan International Cooperation Agency (JICA). The Court
observed that, in the absence of any mala fides,
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arbitrariness, or favouritism, a conscious decision taken
by JICC/JICA could not have been interfered with.
Accordingly, the Hon'ble Apex Court, in the facts of the
case, held as under:
"27. At the cost of repetition, it is to
be noted that under the contractual
obligation, it was not open for the
appellant Corporation and/or even
the Republic of India to deviate from
any of the terms and conditions of
the loan agreement and/or the
decision of JICC/JICA. Therefore, in
the absence of any allegation of mala
fides/arbitrariness and/or
favouritism, we are of the opinion
that the High Court has committed a
grave error in interfering with a
conscious decision taken by
JICC/JICA, which has been followed
by the appellant.
29. Thus, from the aforesaid
decisions, it can be seen that a court
before interfering in a contract
matter in exercise of powers of
judicial review should pose to itself
the following questions:
(i) Whether the process adopted or
decision made by the authority is
mala fide or intended to favour
someone; or whether the process
adopted or decision made is so
arbitrary and irrational that the
court can say: "the decision is such
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that no responsible authority acting
reasonably and in accordance with
relevant law could have reached"?
And
(ii) Whether the public interest is
affected?
If the answers to the above
questions are in the negative, then
there should be no interference
under Article 226.
34. Even otherwise it is required to
be noted that once a conscious
decision was taken by JICC and JICA,
who can be said to be the author of
the terms and conditions of the
tender document, taking a view and
stand that the bid submitted by the
original writ petitioner suffers from
material deviation and the e said
decision was taken after considering
the relevant clauses of ITB,
thereafter it was not open for the
High Court to interfere with such a
conscious decision in exercise of
powers under Article 226 of the
Constitution of India and take a view
that the bid submitted by the
original writ petitioner was in
substantial compliance."
29. In view of the above settled legal position, reliance
placed by the learned advocate for the petitioner on the
decision of AL Faheem Meat Exports Private Limited
(supra) rendered in the facts of the said case, that
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ordinarily the contracts given by the Government by an
instrumentality of the State should be granted only by
public auction or by inviting tenders, would not be
applicable in the present case because when the Policy of
the State Government was deviated in public interest and
procurement was made by respondent No.4 without
inviting tender from the Government-owned Corporation
which was also approved by the highest authority, it
cannot be said to be arbitrary or malafide or against the
public interest. Similarly, the reliance placed on the
decision in M/s. Indian Medicine Pharmaceutical
Corporation (supra) would also not apply in the facts of
this cases the Hon'ble Apex Court in that judgment relied
upon A.L. Faheem Meat Exports Private Limited (supra)
to reiterate that Government action must be just, fair, and
reasonable in accordance with the principle of Article 14
of the Constitution, and Government can deviate from the
root of tender of public auction for the grant of contract,
such deviation must not be discriminatory or arbitrary.
On the contrary, the observations made by the Apex
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Court in paragraph 22 of the said decision would squarely
apply to the present case. It cannot be said that the the
respondent no. 4 has deviated from the root of tenders
which has resulted into discriminatory or arbitratory
action. The deviation has been duly justified, having
received prior approval from respondent Nos. 1 to 3,
thereby fulfilling the requirements of Article 14. Further,
considering the completion of Khel Maha Kumbh 3.0 in
March 2025, respondent no. 4 was required to procure
medals and trophies for distribution within a limited
timeframe. Due to the pendency of the present petition,
no progress could be made in the ordinary course, and
therefore respondent no. 4's proposal seeking deviation
from the procedure of process of Tender came to be
approved by respondent Nos. 1 to 3. We are, therefore,
of the opinion that no interference is required to be made
in the decision of respondent No. 4, as approved by
respondent Nos. 1 to 3, for issuance of the Work Order in
favour of respondent No. 5 for procurement of medals
and trophies for Khel Maha Kumbh 3.0.
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30. In view of the foregoing reasons, the petition being
devoid of merit is accordingly dismissed. No order as to
costs.
(BHARGAV D. KARIA, J)
(L. S. PIRZADA, J)
STANCY GOMES
