Karnataka High Court
Globaltech Enviro Experts Pvt Ltd vs Managing Director on 3 November, 2025
Author: Suraj Govindaraj
Bench: Suraj Govindaraj
-1-
NC: 2025:KHC-D:14933
WP No. 103810 of 2025
HC-KAR
IN THE HIGH COURT OF KARNATAKA,AT DHARWAD
DATED THIS THE 3RD DAY OF NOVEMBER, 2025
BEFORE
THE HON'BLE MR. JUSTICE SURAJ GOVINDARAJ
WRIT PETITION NO. 103810 OF 2025 (GM-TEN)
BETWEEN
GLOBALTECH ENVIRO EXPERTS PVT LTD
C-23 BJB NAGAR BHUBANESHWAR,
ORRISA, INDIA-751014
REPRESENTED BY ITS REGIONAL ASSOCIATE,
MANJUNATH R BANASHANKARI
AGE. 32 YEARS,
OCC .CONSULTANT
#77, SANKALP LAYOUT HINDALGA,
BELAGAVI 591108
...PETITIONER
(BY SRI. DORERAJ B.H., ADVOCATE)
AND
Digitally signed 1. MANAGING DIRECTOR
by SHWETHA
RAGHAVENDRA BELAGAVI SMART CITY LIMITED
Location: HIGH 1ST FLOOR, BUDA OFFICE
COURT OF ASHOK NAGAR, SHIVAJI NAGAR
KARNATAKA BELAGAVI, KARNATAKA-590016
2. THE CHAIRMAN
BELAGAVI SMART CITY LIMITED
1ST FLOOR, BUDA OFFICE
ASHOK NAGAR SHIVAJI NAGAR
BELAGAVI KARNATAKA-590016.
3. MISSION DIRECTOR
SBM (U) KARNATAKA
REPRESENTED BY ITS STATE MISSION DIRECTOR
DIRECTORATE OF MUNICIPAL ADMINISTRATION
9TH & 10TH FLOOR, VISHVESHWARIAH TOWER
-2-
NC: 2025:KHC-D:14933
WP No. 103810 of 2025
HC-KAR
DR. B.R. AMBEDKAR VEEDHI
BENGALURU 560001
4. THE STATE OF KARNATAKA
REPRESENTED BY ITS PRINCIPAL SECRETARY
URBAN DEVELOPMENT DEPARTMENT
VIKAS SOUDHA
BENGALURU 560001
5. RSP GREEN DEVELOMENT
AND LABORATORIES PVT. LTD.,
REPRESENTED BY ITS MANAGING DIRECTOR
S/O. MONORANJAN ROY,
33 SHANTINAGAR SARANI, SANKRAIL
HAORA (M CORP) PO: DANESH SK. LANE,
DIST: HOWRAH, WEST BENGAL 711109
.... RESPONDENTS
(BY SRI. MALLIKARJUNSWAMY B. HIREMATH., ADVOCATE FOR R1;
SRI. SHARAD V. MAGADUM., AGA FOR R4)
THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE
CONSTITUTION OF INDIA PRAYING TO ISSUE A WRIT OF MANDAMUS
OR ANY OTHER APPROPRIATE WRIT, ORDER, OR DIRECTION
DIRECTING RESPONDENT NO. 1 TO ISSUE THE LETTER OF INTENT
(LOI) AND CONSEQUENTIAL WORK ORDER IN FAVOUR OF THE
PETITIONER, BEING THE DULY QUALIFIED L1 BIDDER (ANNEXURE-G),
IN ACCORDANCE WITH SECTION 13(3) OF THE KTPP ACT AND RULE
26(2) OF THE RULES, 2000;AND ETC.
THIS WRIT PETITION COMING ON FOR ORDERS AND HAVING
BEEN RESERVED FOR ORDERS ON 22.09.2025, THIS DAY, THE COURT
PRONOUNCED THE FOLLOWING:
CORAM: THE HON'BLE MR. JUSTICE SURAJ GOVINDARAJ
-3-
NC: 2025:KHC-D:14933
WP No. 103810 of 2025
HC-KAR
CAV ORDER
(PER: THE HON'BLE MR. JUSTICE SURAJ GOVINDARAJ)
1. The Petitioner is before this Court seeking for the
following reliefs:
a. Issue a Writ of Mandamus or any other appropriate Writ,
Order, or Direction directing Respondent No. 1 to issue the
Letter of Intent (LoI) and consequential Work Order in
favour of the Petitioner, being the duly qualified L1 bidder
(Annexure-G), in accordance with Section 13(3) of the
KTPP Act and Rule 26(2) of the Rules, 2000;
b. Declare the contemplated cancellation or any action
arising out of the Board Meeting dated 05.06.2025 as void
and unenforceable, having been undertaken without valid
reasons or due process, in violation of Section 14(1) of the
KTPP Act;
c. Direct the Respondents through an injunction to refrain
from floating or processing any fresh tender-whether in
whole or in fragmented scope-covering the same or
substantially similar work under the CITIIS 2.0 Programme,
so long as the current tender process has not been lawfully
concluded (Annexures-D, G); dated 06/02/2025
d. Direct initiation of blacklisting proceedings against
Respondent No. 5, in terms of Section 23 of the KTPP Act,
on the basis of forged documents submitted in the bid, as
confirmed by the Agartala Municipal Corporation and the
Urban Development Department, GoK (Annexure-F); dated
13/06/2025
e. Issue a writ of certiorari or any other appropriate writ or
order quashing the office order dated 01st July 2025
bearing No: BSCL/E-Proc/ CITHS2.0/NABET/2025-26/issued
by Respondent No.1, the Managing Director, Belagavi
Smart City Limited. A copy of the Office Order dated 01st
July 2025 is produced as Annexure-K.
-4-
NC: 2025:KHC-D:14933
WP No. 103810 of 2025
HC-KAR
f. Issue a Writ of Certiorari or any other Appropriate writ or
order quashing the order No. UDD 169 CSS 2025 dated
16th July 2025 with respect to KPP Portal tender No.
BSCL/2024-25/SE0010/CALL-2) Bid No.B5833522 issued by
Respondent No.4, the Urban Development Department. A
copy of the order No. UDD 169 CSS 2025 dated 16th July
2025 with respect to KPP Portal tender No. BSCL/2024-
25/SE0010/CALL-2) Bid No.B5833522 is herein Produced as
Annexure L.
2. The Petitioner claims to be a Regional associate and
duly authorised signatory of a reputed consultancy
firm engaged in providing environmental and social
safeguard services to various government agencies.
Respondent No. 1, Belgavi Smart City Limited, was
selected under the prestigious CITIIS 2.0 programme,
jointly funded by the Government of India and
international agencies as a smart city, in furtherance
of which a tender came to be issued for the
preparation of ESIA and RAP documents.
3. The first tender floated in January 2025 was cancelled
due to alleged procedural lapses and poor bidder
turnout. The second tender was floated in February
2025, inviting bids from qualified consultancy firms.
-5-
NC: 2025:KHC-D:14933
WP No. 103810 of 2025
HC-KAR
During the preliminary market survey held on
December 24, Respondent No.1 received quotations
from nearly 60 NABET-accredited firms, and it is
alleged that the highest quotation received was Rs 112
lakhs.
4. Tender having been called in the month of January
2025, which had been cancelled, the second tender, as
indicated, came to be floated in February 2025. The
Petitioner participated in the second tender and
submitted an Earnest Money Deposit [EMD] of
Rs.1,00,000/- through the official Karnataka Public
Procurement Portal, established under the Karnataka
Transparency in Public Procurement Act, 1999 ['KTPP
Act of 1999' for short] and Karnataka Transparency
in Public Procurement Rules, 2000 [KTPP Rules of
2000' for short]. The evaluation process being two
stages, one for technical and the other for financial,
the Petitioner was declared as the lowest responsive
and technically qualified bidder, quoting a fee of Rs.
-6-
NC: 2025:KHC-D:14933
WP No. 103810 of 2025
HC-KAR
97.98 lakhs. The evaluation committee recorded the
same and recommended the award.
5. During the bid evaluation, the Petitioner had also
brought to the notice of the respondents that
Respondent No.5 had submitted forged work orders
and manipulated credentials to qualify, and certain
penal actions were being taken against Respondent
No.5, including blacklisting. Upon conclusion of the
technical and financial evaluation, the Petitioner
expected to be issued the letter of intent as the lowest
responsive bidder.
6. Petitioner was informed by Respondent No.1 that
Respondent No.2, the Chairman of the Belgavi Smart
City Limited, and Respondent No.3, being the Mission
Director, SBM(U), Karnataka, had instructed
Respondent No.1 to cancel the tender on the ground
that the quoted bid amount was on the higher side. It
is aggrieved by the same; the Petitioner is before this
Court.
-7-
NC: 2025:KHC-D:14933
WP No. 103810 of 2025
HC-KAR
7. Sri Doreraj.B.H, learned counsel for the Petitioner,
would submit that,
7.1. The fundamental rights of the Petitioner under
Article 14 of the Constitution have been violated
inasmuch as, though the Petitioner is the lowest
responsive tenderer, his tender has been rejected
for grounds not recognised under law.
7.2. The rights of the Petitioner under Article 19(1-g)
of the Constitution have also been violated since
the Petitioner's right to carry out any business to
earn his livelihood has been violated. He submits
that the benchmark ceiling was arrived at Rs.
112 lakhs; therefore, the bid of the Petitioner,
being Rs. 97.98 lakhs, which is 12.5% lower, was
required to be accepted by the respondents.
7.3. In terms of Section 14(1) of the KTPP Act, the
ground of the bid being rejected being on the
higher side is not available. In this regard, he
relied upon the decision of this Court in
-8-
NC: 2025:KHC-D:14933
WP No. 103810 of 2025
HC-KAR
Devendra Kumar -v- State of Karnataka1,
and submits that the procurement of all goods
and services under the KTTP Act has to be done
within a reasonable period. The final evaluations
having been completed in February 2025, the
rejection made of the Petitioner's bid
subsequently is beyond a reasonable period and
as such, contrary to Subsection (3) of Section 10
of the KTTP Act.
7.4. He also relies on the decision of the Hon'ble Apex
Court in Tata Cellular v. Union of India2, and
submits that inaction or delay in finalising
tenders would constitute maladministration and,
as such, this Court could exercise the power of
judicial review in such matters.
7.5. Much was sought to be made out under
Subsection (2) of Section 9 and Section 23 of the
KTTP Act to contend that the respondents are
1
ILR 2013 Karnataka 3077
2
(1994)6 SCC 651
-9-
NC: 2025:KHC-D:14933
WP No. 103810 of 2025
HC-KAR
seeking to finalise the tender with Respondent
No.5 without blacklisting. However, Sri,
Mallikarjuna Swami B. Hiremath, learned counsel
for Respondent No.1, intervened and
categorically stated that Respondent No.5 has
been blacklisted, and it is for this reason that
several arguments which have been advanced by
Sri.Doreraj in respect to Respondent No.5 are
not being dealt with.
7.6. He relies upon the decision in T.S. Gopikrishna
vs. Executive Officer3, more particularly para 9
and 10 thereof, which are reproduced hereunder
for easy reference:
9. Having heard the learned counsel for the Petitioner
and the respondents, apparently there is no dispute
that the successful bidder was not successful in the
writ petition filed by him, pursuant to which,
withdrawal of the tender was issued at Annexure-A
and respondents are intending to issue fresh
notification. It is not in dispute that there were only
two participants. Successful bidder, though declared
successful, was disqualified for being a minor at the
time of applying for the tender and successful bidder
filed petition challenging the said Annexure-A, of
3
WP No.103474 of 2024 dated 11.11.2024
- 10 -
NC: 2025:KHC-D:14933
WP No. 103810 of 2025
HC-KAR
withdrawing the notification, which came to be
dismissed by this Court.
10. As stated herein supra, when there were only two
participants in the tender, the respondents, after
declaring the successful bidder to be ineligible due to
reasons of him being a minor, could have considered
the application of the other only tender participant,
and there being no other persons, could have
considered on the NC: 2024:KHC-D:16441 basis of
his qualification, eligibility and other necessary
requirements as per law. It is also not the case of the
respondents that the Petitioner was ineligible. Having
not done so, the impugned order at Annexure-A
deserves to be set aside.
7.7. By relying on T.S.Gopikrishna's case, his submission
is that the tender cannot be entirely set aside; it is
the eligibility of the tenderer which is required to be
considered.
7.8. He relies upon the decision of the Honourable Apex
Court in Prakash Asphaltings and Toll Highways
(India) Limited vs. Mandeepa Enterprises4, more
particularly para 39, 40 and 41 thereof, which are
reproduced hereunder for easy reference:
39. A three-Judge Bench of this Court in CIDCO Vs.
Shishir Realty Private Limited7, observed that when a
contract is being evaluated, the mere possibility of more
4
2025, INSC 1108
- 11 -
NC: 2025:KHC-D:14933
WP No. 103810 of 2025
HC-KAR
money in the public coffers does not in itself serve public
interest. This Court held as follows:
61. When a contract is being evaluated, the mere
possibility of more money in the public coffers, does not in
itself serve public interest. A blanket claim by the State
claiming loss of public money cannot be used to (2012)
16 SCC 527 forego contractual obligations, especially
when it is not based on any evidence or examination. The
larger public interest of upholding contracts and the
fairness of public authorities is also in play. The courts
need to have a broader understanding of public interest,
while reviewing such contracts.
40. The above proposition has been followed by another
three-Judge Bench of this Court in the recent case of
Subodh Kumar Singh Rathore Vs. Chief Executive Officer
8, when it examined the concept of public interest in
administrative decisions relating to award of contracts.
This Court held that even assuming for a moment that
there was technical fault in the tender, which if rectified
had the possibility of generating more revenue, the same
by no stretch could he said to be a cogent reason for
concealing an already existing tender. This Court
highlighted the importance of maintaining the sanctity of
tenders in governmental procurement processes. Public
tenders are the cornerstone of governmental procurement
processes, being competitive and ensuring fairness and
transparency in the allocation of public resources. Public
2024 SCC Online SC 1682 tenders are designed to provide
a level playing field for all potential bidders, fostering an
environment where competition thrives. The integrity of
this process ensures that public projects and resources
are delivered efficiently and effectively, benefiting the
society at large. Therefore, sanctity of publie tenders and
contract is a fundamental principle that underpins the
stability and predictability of legal and commercial
relationships. Infact this Court put in a word of caution
that considerations of public interest should not be
narrowly confined to financial aspect only.
41. Applying the above legal principles to the facts of the
present case, we are of the view that the Division Bench
of the High Court clearly fell in error in directing
- 12 -
NC: 2025:KHC-D:14933
WP No. 103810 of 2025
HC-KAR
respondent No. 2 to 4 to allow rectification of the financial
bid of respondent No. 1 by treating the amount offered by
it as the per day figure and on that basis to compute the
total amount for the entire contractual period of 1095
days. Such an exercise is clearly impermissible having
regard to the terms and conditions of the contract which
are required to be understood on the anvil of this Court's
judgments. The authority granted to the tendering
authority by clause 5B (v) of the Instruction to Bidders
cannot be stretched to construe the price bid of
respondent No. 1 as the per day offer, contrary to the bid
declaration of respondent No. 1 itself, and thereafter, on
that basis to work out a new bid amount for the entire
contractual period making it the highest. In the present
case, respondent No. 1 was not at all vigilant; rather, it
displayed a very casual approach. In such circumstances,
clause 5B(v) cannot be invoked to resurrect the bid of
respondent No. 1 to make it H1. Clause 5B(v) of the
Instruction to Bidders has to read conjointly with clause
4(g) of the notice inviting electronic bid.
7.9. By relying on Prakash Asphalting's case, he
submits that a bland reason made by the State
claiming loss of public money cannot be used to
forego contractual obligation, and on that basis, he
submits that the reasoning given by the respondents
that the tender submitted by the Petitioner is at a
higher value is bad in law and is required to be
quashed.
- 13 -
NC: 2025:KHC-D:14933
WP No. 103810 of 2025
HC-KAR
7.10. He relies on the decision in Aditi D/o Shetty -v-
NWKRTC5, more particularly para 3 and 4 thereof,
which are reproduced hereunder for easy reference:
3. Respondent No.1 admits, that Petitioner was the
highest bidder and his bid amount is more than the
reserve price. It is also admitted that the Petitioner is
otherwise qualified to participate in the tender and there
was no defect in the bid made by him. The only reason
attributed for cancellation of the tendering process is that
the bid of the Petitioner is less than what respondent
No.1 had got for the same stall in the previous tender
and reliance is placed on Section 14 of the Karnataka
Transparency in Public Procurements Act for rejection of
the tender stating that under the given peculiar facts and
circumstances of the case, there has been a failure of
anticipated financial resource and that is a ground for the
authority to cancel the tendering process.
4. The argument of respondent No.1 cannot be accepted
because admittedly there has been no mistake on part of
the Petitioner. He is qualified to participate in the tender
and his bid is the highest and the bid is above the
minimum reserve price fixed by respondent No.1. It is
not the case of the respondent No.1 that it is availing the
services of the Petitioner for some service for which it
has to pay the consideration and it does not have the
necessary financial resource to be eligible to take shelter
under the said ground. Fixing minimum reserve price is
the prerogative of the respondent No.1. Nothing
prevented respondent No.1 from fixing a higher amount
as the minimum reserve price. Having fixed the minimum
price at Rs.2,18,261/- per month as the licence fee,
respondent No.1 is bound to lease the premises for a bid
higher than the said amount. Thus, cancellation of the
tender under the circumstance has to be held illegal.
5. For the said reason, the writ petition is hereby allowed
and the following order is passed:
5
WP 106551/2023 DD 9.11.2023
- 14 -
NC: 2025:KHC-D:14933
WP No. 103810 of 2025
HC-KAR
ORDER
i. The decision of respondent No.1 dated 16.10.2023
cancelling the tender for Stall No.5 at Central Bus
Stand, Belagavi for the purpose of canteen is
hereby set aside.
ii. Consequently, rejection of the bid of the Petitioner
is also set aside. Respondent No.1 is directed to
process the bid of the Petitioner as per E-Tender
Notification No.5 of 2023 dated 05.09.2023 and
award him to contract in respect of Stall No.5,
Central Bus Stand, Belagavi, for canteen, if the
Petitioner is otherwise found eligible.
8. The submission of Sri.Mallikarjuna Swamy Hiremath,
learned counsel for Respondent No.1, is that,
8.1. Firstly, Respondent No.1, being the employer, it
is not required for Respondent No.1 to accept
any bid which has been submitted by any of the
tenderers. Respondent No. 1 has retained the
right to reject any tender submitted, without any
reason. Insofar as the so-called benchmark rate
of Rs. 112 lakhs, he submits that the same is a
unilateral statement. There is no such
benchmark rate which has been fixed by
Respondent No.1 as alleged or otherwise.
- 15 -
NC: 2025:KHC-D:14933
HC-KAR
8.2. In the tender called on 10.01.2025, there was
only one bidder who participated and it is for that
reason that a fresh tender was issued. The bid of
the Petitioner of Rs.98,97,500/- being the
lowest, was placed before the Respondent No.1
for approval by the Tender Evaluation
Committee. Merely because the Tender
Evaluation Committee has placed the same
before Respondent No.1 would not amount to a
recommendation and even if it amounts to a
recommendation, the same would not come in
the way of Respondent No.1 rejecting the
recommendation.
8.3. His submission is that various allegations made
by the Petitioner against Respondent No.5 have
been taken into consideration and Respondent
No.5 has been backlisted. After the technical and
financial bid evaluation, the rates quoted by the
Petitioner, when compared with the preliminary
- 16 -
NC: 2025:KHC-D:14933
HC-KAR
market price survey, were found to be on the
higher side and hence, were forwarded to the
State Nodal Officer, who is designated by the
State Government to monitor the progress of the
project, who directed the matter to be placed
before the Board.
8.4. The Board, in its 40th meeting held on
1.07.2025, resolved to cancel the tender and call
for an expression of interest for setting a
benchmark, which came to be uploaded onto the
portal on 2.07.2025. An appeal was filed by the
Petitioner under Section 16 of the KTTP Act
before the Appellate Authority. The Appellate
Authority rejected the contention of the
Petitioner.
8.5. His submission is that before such rejection,
respondent No.1 had called for bids which had
been submitted in respect of similar kinds of
projects in various other cities, and it is after
- 17 -
NC: 2025:KHC-D:14933
HC-KAR
taking into consideration the said bids which had
been received by those cities that the bid of the
Petitioner, which was found on the higher side,
was cancelled.
8.6. There is a duty which has been imposed on
respondent No.1 to safeguard the public monies.
Merely because the person is the lowest bidder
would not create any vested right in such lowest
bidder to receive the contract. There is a duty
imposed on the Office of Respondent No.1 to get
the best offer and not make payment of any
amounts over and above what is required to be
paid.
8.7. He refers to the Minutes of the meeting, which
were held on the 40th meeting of the Board held
on 5.06.2025 and the comparison of rates made
by the Board before coming to the said decision.
In that regard, he submits that the documents
and or bids received by Agra, Muzaffarnagar,
- 18 -
NC: 2025:KHC-D:14933
HC-KAR
Panaji, Bareily, were compared with that
submitted by the Petitioner in Belagavi and the
amounts were found to be much more than what
was submitted in the other cities and it is for that
reason that the tender has been rejected and
that the bid of the Petitioner has been rejected.
8.8. On these grounds, he submits that the rejection
made by the respondent being proper and
correct, the petition is liable to be dismissed.
9. Heard Sri.Doreraj.B.H, learned counsel for the
Petitioner, Sri.Mallikarjunaswamy B.Hiremath, learned
counsel for respondent No.1 and Sri.Sharad
V.Magadum, learned AGA for respondent No.4.
Perused papers.
10. The points that would arise for determination are,
i. Whether an employer could reject a tender
bid even if the bid was the lowest received?
ii. Whether the lowest bidder has any
legitimate expectation that his bid would be
accepted by the employer or tender inviting
authority?
- 19 -
NC: 2025:KHC-D:14933
HC-KAR
iii. In the present case, is the rejection made
by respondent No.1 of the bid submitted by
the Petitioner, proper and correct?
iv. What order?
11. I answer the above points as under:
12. ANSWER TO POINT NO.1: Whether an employer
could reject a tender bid even if the bid was the
lowest received?
12.1. In normal circumstances, the methodology of
consideration of a bid submitted under a tender
is two-pronged. One is on the basis of technical
competency, and if the technical competency is
established, then on the basis of the financial bid
submitted. The two-pronged methodology is
adopted firstly to ascertain if the bidder qualifies
the technical requirement, and it is only if a
bidder qualifies such technical requirements as
may be laid down in the contract, that the
financial bid would be opened of the successful
technical bidders to ascertain, in order to award
- 20 -
NC: 2025:KHC-D:14933
HC-KAR
the contract to the lowest bidder or the highest
bidder depending on the nature of the contract.
12.2. Section 13 of the KTTP Act reads as under:
13. Acceptance of Tender.- The Tender Accepting
Authority shall, after following such procedure as may be
prescribed pass order accepting the tender and shall
communicate the information relating to acceptance of
tender together with a comparative analysis and reasons
for accepting of tender to the procurement entity and ["on
the Karnataka Public Procurement Portal."]22
Provided that where the Tender Accepting Authority
consists of single officer who is due to retire within the
next six months, from the date fixed for the acceptance
for tender, he shall not act to accept the tender without
obtaining prior approval of the Procurement Entity:
Provided further that subject to such general or special
order as may be issued by the Government from time to
time, the Tender Accepting Authority may before passing
order accepting a tender negotiate with lowest tenderer.
12.3. In terms of Section 13, the tender accepting
authority shall, after following such procedure as
may be prescribed, pass an order accepting the
tender and shall communicate the information
relating to acceptance of tender along with
comparative analysis and reasons for accepting
the tender to the procurement entity and the
tender bulletin officer. The tender accepting
- 21 -
NC: 2025:KHC-D:14933
HC-KAR
authority, before passing any order, may also
negotiate with the lowest tenderer.
12.4. Section 14 of the KTTP Act reads as under:
14. General rejection of tenders.-
1. The Tender Accepting Authority may at any time
before passing an order of acceptance under section
13 reject all the tenders on the ground of changes in
the scope of procurement, failure of anticipated
financial resource, accidents, calamities or any other
ground as may be prescribed which would render
the procurement unnecessary or impossible and
report the same to the Procurement Entity.
2. The Procurement Entity shall thereafter
communicate the fact of the rejection under this
section to all the Tenderers and also cause the same
to be published in the ["the Karnataka Public
Procurement Portal."
"14A. Debarment of Tenderers.-
(1) The Procurement Entity may debar tenderers,
for a period not exceeding three years, from
participation in its tenders, following such procedure
as may be prescribed on the ground that tenderer is
engaged in corrupt or fraudulent practices in
competing or executing the contract including
misleading the procuring entity at any stage of
Procurement Activity with a fraudulent intention:
Provided that, no tenderer shall be debarred without
giving opportunity of being heard.
(2) The State Government may debar tenderers for
a period not exceeding three years, from
participating in any procurement activity within the
State, following such procedure as may be 22
Substituted by Karnataka Act No. 6 of 2019 w.e.f.
24-01-2019 23 Substituted by Karnataka Act No. 6
of 2019 w.e.f. 24-01-2019 11 prescribed, on
- 22 -
NC: 2025:KHC-D:14933
HC-KAR
grounds of, but not restricted to, criminal offence,
corruption, integrity, honesty and work ethics:
Provided that no tenderer shall be debarred without
giving opportunity of being heard.
(3) The State Government shall publish the list of so
debarred tenderers under sub-section (2) from
participating in any procurement activity on the
Karnataka Public Procurement portal.
(4) The tenderer so debarred under sub section (2)
shall not be entitled to apply to participate in
tenders called by any procurement entity under this
Act during the period so debarred."
12.5. In terms of Section 14, the tender accepting
authority, may at any time, before passing an
order of acceptance under Section 13, reject all
the tenders on the ground of changes in the
scope of procurement, failure of anticipated
financial resource, accidents, calamities or any
other ground, as may be prescribed, which would
render the procurement unnecessary or
impossible and report the same to the
procurement entity. The procurement entity, in
terms of Subsection (2) of Section 14, shall,
thereafter, communicate the fact of rejection to
- 23 -
NC: 2025:KHC-D:14933
HC-KAR
all the tenderers and cause the same to be
published in the tender bulletin.
12.6. The submission of Sri.Mallikarjuna Swamy B.
Hiremath, learned counsel for Respondent No.1
is that the rejection of the tender of the
Petitioner has been made under Subsection (1)
of Section 14 of the KTTP Act. As indicated
supra, the tender accepting authority can, at any
time, before passing an order of acceptance
under Section 13, reject all the tenders. In the
present matter, this first condition is satisfied
inasmuch as there is no acceptance of any
tender by the tender acceptance authority. The
reasons for rejection could be:
i) change in scope of procurement;
ii) failure of anticipated financial resource;
iii) accidents;
iv) calamities;
v) any other ground, as may be prescribed,
which would render the procurement
unnecessary or impossible.
- 24 -
NC: 2025:KHC-D:14933
HC-KAR
12.7. In the present case, the scope of procurement
has not undergone a change. The financial
resource for funding the tender continues to be
in place. Therefore, there is no failure. There is
no accident or calamity which has arisen giving a
reason for the tender accepting authority to
reject the tender. Thus, the only heading under
which the rejection could come is any other
ground as may be prescribed, which would
render the procurement unnecessary or
impossible.
12.8. The aspect of the tender continues to be
necessary inasmuch as Respondent No.1 is not
giving up the project. The said project has also
not become impossible since Respondent No.1
continues to want to implement the project. If
these aspects were to be taken into
consideration, on the face of it, the rejection
made by Respondent No.1 would be improper.
- 25 -
NC: 2025:KHC-D:14933
HC-KAR
However, what this Court would also have to look
into while dealing with public tenders is whether
the public money has been put to the best use.
12.9. The Board of Directors of Respondent No.1,
having received a lowest bid of Rs.97,98,525/-,
being of the opinion that the same is on the
higher side, had also called for documents
relating to bids, received by other cities in the
country for similar projects, namely from Agra,
Muzaffarnagar, Panaji and Bareilly. The bid for
Panaji, being quotation-based, was not one
which was taken to be of a similar nature to be
examined. However, the bids of Agra,
Muzaffarnagar and Bareilly were considered and
the Board found that the works being carried out
under the said tenders were more or less
identical to that of Belagavi and the population in
some of the cities was greater than that in
Belagavi, so also the area of the city and in that
- 26 -
NC: 2025:KHC-D:14933
HC-KAR
background, the Board decided not to accept the
bid of the Petitioner, though being the lowest
one.
12.10. This action on the part of the respondent-Board
is required to be commended rather than found
fault with as contended by the Petitioner
inasmuch as in most cases coming up before this
Court, it has seen that the tenders are inflated
and allegations are made in relation thereto upon
awardal.
12.11. In the present case, respondent No.1 has acted
in a proactive manner, obtained necessary
documentation and rejected the bid of the
Petitioner. The complaints which have been filed
by the Petitioner in respect of Respondent No.5
has also been given due regard and Respondent
No.5 has been blacklisted. Thus, the decisions
which have been relied upon by the Petitioner
would not be applicable in the present case for
- 27 -
NC: 2025:KHC-D:14933
HC-KAR
the simple reason that in the present matter, the
Board has applied its mind, considered the bid of
the Petitioner to be on the higher side and
resolved to issue a fresh EOI to set a proper
benchmark to call for a fresh short-term tender.
This action on the part of the respondents, in my
opinion, is a proper one, and such an action
taken by Respondent No.1 cannot be faulted with
on the ground of Petitioner's right under Article
19(1)(g) being affected.
12.12. The right of the Petitioner under Article 19(1)(g)
is not absolute. Such a right cannot be expanded
to include charging a higher amount than is
permissible or acceptable to the tendering
authority. If there are any reasons found by the
tender accepting authority as to the bid being
submitted, the bid being lowest but higher than
- 28 -
NC: 2025:KHC-D:14933
HC-KAR
what is permissible or acceptable, the tender
accepting authority could reject the same.
12.13. Hence, I answer point No.1 by holding that an
employer could reject a tender bid even if the bid
was the lowest received, so long as the rejection
is accompanied by valid reasons, which could be
subject matter of Judicial Review before this
Court.
13. ANSWER TO POINT No.2: Whether the lowest
bidder has any legitimate expectation that his
bid would be accepted by the employer or tender
inviting authority?
13.1. Much of this has been dealt with in answer to
point No.1. There can be no vested right which
can be said to be created in favour of the lowest
bidder. The acceptance of the bid shall always be
at the option of the tender accepting authority.
However, the acceptance or rejection has to
stand the test of law. All things being equal, the
- 29 -
NC: 2025:KHC-D:14933
HC-KAR
lowest bidder would have a legitimate
expectation of the lowest bid being accepted.
However, in the present case, even though the
Petitioner has submitted a lowest bid, the said
bid when compared to bids submitted in other
cities is on a far higher rate and as such, the
tender accepting authority would have a right to
reject even the lowest bid and the lowest bid per
se would not create a legitimate expectation on
part of the lowest bidder that the said bid would
be accepted by the tender accepting authority.
13.2. Hence, I answer point No.2 by holding that
normally the lowest bidder would have a
legitimate expectation of the lowest bid being
accepted, however, the tender accepting
authority could reject even the lowest bid if the
said bid is found to be higher than what is
normally submitted in such kind of tenders, by
giving valid reasons.
- 30 -
NC: 2025:KHC-D:14933
HC-KAR
14. ANSWER TO POINT NO. 3: In the present case, is
the rejection made by respondent No.1 of the bid
submitted by the Petitioner, proper and correct?
14.1. Again, this has been answered substantially in
answer to point No.1. The Board having
examined the bids submitted for Agra,
Muzaffarnagar and Bareilly, which are similarly
situated, some of them having larger land area
and larger population than Belagavi, I am of the
considered opinion that Respondent No.1 has
taken into consideration suitable and appropriate
reference points and having taken such reference
points found that the bid submitted by the
Petitioner is on a higher side inasmuch as the bid
submitted for Agra was Rs.25 lakhs,
Muzaffarnagar Rs.30 lakhs, Bareilly Rs.55 lakhs,
whereas the bid submitted by the Petitioner was
for Rs.97.98 lakhs is proper and correct and does
not require any interference.
- 31 -
NC: 2025:KHC-D:14933
HC-KAR
15. ANSWER TO POINT NO.4: What Order?
No grounds being made out, the Petition stands
dismissed.
SD/-
(SURAJ GOVINDARAJ)
JUDGE
LN/-
