Malik Sales Corporation vs Union Territory Of J&K Through Chief
2025 Latest Caselaw 5 J&K/2

Jammu & Kashmir High Court - Srinagar Bench

Malik Sales Corporation vs Union Territory Of J&K Through Chief on 2 May, 2025

                                      1


        IN THE HIGH COURT 0F JAMMU & KASHMIR AND LADAKH
                           AT SRINAGAR

                                 WP(C) 929/2025
                                 CM 2445/2025

1. Malik Sales Corporation, Office at Bandipora,          ...Petitioner(s)/Appellant(s)
   J and K through its proprietor
   Umer Farooq Malik (Age 35 Years)
   S/o Farooq Ahmad Malik
   R/o Bandipora
2. Crescent Sales Corporation,
   Office at Karanagar, Srinagar
   Through its proprietor
   Yasir Amin Shah (Age 44 years)
   S/o Mohammad Amin Shah
   R/o Hawal, Srinagar

Through:     Mr. Shahid Zameer Ahmad, Advocate

                                          Vs.
1. Union Territory of J&K Through Chief                            ...Respondent(s)
      Secretary,Civil Secretariat, Jammu/Srinagar
      J&K.
2. Commissioner/Secretary        to       Government,
      Home     Department,      Civil       Secretariat
      Jammu/Srinagar.
3. Director General of Police, Prisons Jammu and
      Kashmir at Jammu/Srinagar.
4. Superintendent Jai!, District Jail Baramulla.
      Khawja Bagh, Baramulla- 193103


Through: Mr. Jahangir Dar, Advocate



CORAM: HON'BLE MR. JUSTICE WASIM SADIQ NARGAL, JUDGE
                             ORDER (ORAL)

1. The instant petition has been preferred by the petitioners being

aggrieved by the impugned tender notice dated 07.03.2025 read

with retender notice dated 02.04.2025 issued by the respondent

No 4 for supply of dietary and other items to District Jail

Baramulla for FY- 2025-2026 wherein the petitioners contends

that a harsh and unreasonable condition of 4 years' experience

has been made mandatory for participation in bid process.

2. The case of the petitioners is that the aforesaid condition is

arbitrary, unreasonable and discriminatory and it has been kept

to favour only few bidders to accommodate them. Furthermore,

the other jails of Union Territory of Jammu and Kashmir have

issued similar tenders for supply of dietary items but none of

them have kept 4 years' experience.

3. It is also the case of the petitioners that the supply of dietary

items does not require any kind of technical expertise of highest

level of skill as such this condition may be waived off by this

court, so that the petitioners could also participate in the tender

process.

4. Further the learned counsel for the petitioners argued that the

process of tendering should ensure equal opportunity for

bidders. The impugned tender Notice has been issued against

the policy of Competition Law and procurement rules which

demand healthy competition among the bidders as such; the

motive of respondent No 4 is to eliminate the competition

among the bidders and also to prevent monopoly.

5. Heard Learned Counsel for the petitioners and perused the

record.

ISSUE FOR CONSIDERATION

Whether the tender condition requiring four years' prior experience violates Article 14 or is otherwise arbitrary or unreasonable in the context of public procurement?

LEGAL ANALYSIS:

6. Without going into the genesis of the controversy in hand, this

Court is mindful of the settled legal position that the

formulation of tender conditions falls squarely within the

administrative and policy domain of the expert authority

concerned. The courts, in exercise of their power of judicial

review under Article 226 of the Constitution, do not act as

appellate bodies to examine the minutiae or wisdom of such

policy decisions, particularly in the realm of public

procurement.

7. Also tender conditions are primarily designed and implemented

by the concerned authorities with a view to achieving the best

possible outcome for public interest, such as selecting a

competent bidder who can meet the demands of the contract

and in certain sectors and industries, experience plays a critical

role in ensuring the successful completion of a project,

especially when dealing with public contracts that demand

expertise, reliability, and an established track record.

8. Judicial interference in such matters is warranted only when the

impugned condition is shown to be:

(a) manifestly arbitrary,

(b) discriminatory in nature, or

(c) vitiated by mala fides or extraneous considerations.

9. In the instant matter, the petitioners challenges the condition

requiring a minimum of four years' prior experience. However,

the respondent's object of this condition is aimed at ensuring

that only bidders with adequate operational history and

demonstrated competence are eligible, considering the technical

complexity and scale of the work involved.

10. Furthermore, the petitioners has not satisfied this Court to

suggest that the four-year experience requirement is

discriminatory or unjustified. The petitioners' assertion that the

condition is exclusionary does not, in itself, establish that the

same is arbitrary or unreasonable. Unless and until it is

established by the petitioners that there is an element of

arbitrariness, irrationality, mala fides and bias, it is only under

those circumstances, the Court can interfere with the decision

made by the respondent department.

11. The Hon'ble Supreme Court in the case titled as "Tata Cellular

vs Union of India reported as (1994) 6 SCC 651", has

reviewed the entire case law on the subject and laid down the

following principles for application to cases involving judicial

review in tenders/contractual matters. The relevant paragraph

of the said judgment is reproduced as herein under:-

".....94. The principles deducible from the above are:-

(1) The modern trend points to judicial restraint in administrative action.

(2) The court does not sit as a court of appeal but merely reviews the manner in which the decision was made. (3) The court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible.

(4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts. (5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principle of reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fide.

(6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure."

12. Similarly, the decision of the Hon'ble Supreme Court in the

case titled "Directorate of Education and Ors. v.

Educompdatamatics Limited & Ors., reported 2004 (4) SCC

19" reiterates the said position. The Hon‟ble Apex Court in that

case was examining a tender notice, which stipulated a turnover

of Rs. 20.00 Crores as a condition of eligibility and held that

the Government must have a freehand in stipulating the terms

of the tender and that it must have reasonable play in the joints

as a concomitant necessary for an administrative body in

administrative sphere. The Apex Court at para-12 observed as

under: -

"12. It has clearly been held in these decisions that the terms of the invitation to tender are not open to judicial scrutiny the same being in the realm of contract. That the Government must have a free hand in setting the terms of the tender. it must have reasonable play in its joints as a necessary concomitant for an administrative body in an administrative sphere. The courts would interfere with the administrative policy decision only if it is arbitrary, discriminatory, mala fide or actuated by bias, it is entitled to pragmatic adjustments which may be called for by the particular circumstances. The courts cannot strike down the terms of the tender prescribed by the Government because it feels that some other terms in the

tender would have been fair, wiser or logical. The courts can interfere only if the policy decision is arbitrary, discriminatory or mala fide."

13. This Court is also fortified with the judgment of Hon‟ble Apex

Court delivered in case titled, "Silppi Constructions

Contractors Vs. Union of India, reported in (2020) 16 SCC

489", wherein at paras-19 & 20, following has laid down:-

"......19. This Court being the guardian of fundamental rights is duty bound to interfere when there is arbitrariness, irrationality, mala fides and bias. However, this Court in all the aforesaid decisions has cautioned time and again that courts should exercise a lot of restraint while exercising their powers of judicial review in contractual or commercial matters. This Court is normally loathe to interfere in contractual matters unless a clear-cut case of arbitrariness or mala fides or bias or irrationality is made out. One must remember that today many public sector undertakings compete with the private industry. The contracts entered into between private parties are not subject to scrutiny under writ jurisdiction. No doubt, the bodies which are State within the meaning of Article 12 of the Constitution are bound to act fairly and are amenable to the writ jurisdiction of superior courts but this discretionary power must be exercised with a great deal of restraint and caution. The Courts must realise their limitations and the havoc which needless interference in commercial matters can cause. In contracts involving technical issues the courts should be even more reluctant because most of us in judges‟ robes do not have the necessary expertise to adjudicate upon technical issues beyond our domain. As laid down in the judgments cited above the courts should not use a magnifying glass while scanning the tenders and make every small mistake appear like a big blunder. In fact, the courts must give "fair play in the joints" to the Government and public sector undertakings in matters of contract. Courts must also not interfere where such interference will cause unnecessary loss to the public exchequer.

20. The essence of the law laid down in the judgments referred to above is the exercise of restraint and caution; the need for overwhelming 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."

CONCLUSION

14. From the aforesaid legal position and enunciation of law, it is

clear that Experience-based eligibility criteria are not

uncommon in Government tenders and are often employed to

safeguard the quality, timeliness, and reliability of execution

and this Court finds that such a requirement cannot, on the face

of it, be termed arbitrary or lacking in rationale. It is not for the

Court to substitute its own opinion in place of that of the

tendering authority unless the condition is egregiously

unreasonable or appears to be tailored to exclude a particular

party without just cause.

15. The Court is of the prima facie view that the genesis or

rationale of the condition does not warrant deeper judicial

scrutiny, as the same falls within the permissible policy domain

of the respondent authority. Thus the above framed issue is

answered against the petitioners and in favour of respondents.

16. In view of the above, this Court holds that the challenge of the

petitioners to the impugned notices inviting tender (NIT) dated

07-03-2025 read with 02-04-2025 is ill-founded and the writ

petition being devoid of any merit is liable to be dismissed and

the same is accordingly dismissed in limine along with all

connected applications.

17. The writ petition is, accordingly, dismissed in limine along

with connected application.

(Wasim Sadiq Nargal) Judge Srinagar 02.05.2025 Mubashir

Whether the judgment is speaking? Yes Whether the judgment is reportable? Yes