Madhya Pradesh High Court
Ritesh Tiwari vs The State Of Madhya Pradesh on 1 May, 2024
Author: Gurpal Singh Ahluwalia
Bench: Gurpal Singh Ahluwalia
1
IN THE HIGH COURT OF MADHYA PRADESH
AT JABALPUR
BEFORE
HON'BLE SHRI JUSTICE GURPAL SINGH AHLUWALIA
ON THE 1st OF MAY, 2024
WRIT PETITION No. 9827 of 2024
BETWEEN:-
RITESH TIWARI S/O SHRI RAJENDRA
TIWARI, AGED ABOUT 41 YEARS,
OCCUPATION: BUSINESS R/O 255
MANMOHAN NAGAR JABALPUR
(MADHYA PRADESH)
.....PETITIONER
(BY SHRI D.K.DIXIT - SENIOR ADVOCATE WITH SHRI ANSHUL DIXIT -
ADVOCATE)
AND
1. THE STATE OF MADHYA
PRADESH THROUGH THE
PRINCIPAL SECRETARY
DEPARTMENT OF FOOD CIVIL
SUPPLIES AND CONSUMER
PROTECTION MANTRALAYA
BHOPAL (MADHYA PRADESH)
2. MADHYA PRADESH STATE
CIVIL SUPPLIES CORPORATION
LIMITED THROUGH ITS
MANAGING DIRECTOR
PARYAWAS BHAWAN 3RD
FLOOR 1ST WING PARYAWAS
BHAWAN ARERA HILLS
BHOPAL (M.P.) (MADHYA
PRADESH)
3. REGIONAL MANAGER
COLLECTORATE JABALPUR
(M.P.) (MADHYA PRADESH)
4. DISTRICT MANAGER
COLLECTORATE JABALPUR
2
(M.P.) (MADHYA PRADESH)
5. SHRI MOHIT SHUKLA S/O SHRI
ROHIT SHUKLA OCCUPATION:
TRANSPORTER HOUSE NO 59 K
PATEL MAHALLA SHALIWADA
GOUR MANDLA ROAD
JABALPUR (M.P.) (MADHYA
PRADESH)
6. SHRI ABHINAYA KUMAR SINGH
S/O SHRI BRAHMANAND SINGH
OCCUPATION: TRANSPORTER
7701/A5 NEW GUJRATI COLONY
PURWA JABALPUR (M.P.)
(MADHYA PRADESH)
7. SHRI ROHIT GYAN JAIN S/O
SHRI GYAN CHAND JAIN
OCCUPATION: TRANSPORTER
107 CHERITAL WARD SHIV
NAGAR DAMOH ROAD
JABALPUR (M.P.) (MADHYA
PRADESH)
8. SHRI VIMAL KUMAR
CHOUDHARY S/O SHRI SANJU
CHOUDHARY OCCUPATION:
TRANSPORTER 403 AMKHERA
NEAR SARKARI SCHOOL
JABALPUR (M.P.) (MADHYA
PRADESH)
.....RESPONDENTS
(RESPONDENTS/STATE BY SMT.SWATI A.GEORGE - DEPUTY GOVT.
ADVOCATE)
This petition coming on for admission this day, the court passed the
following:
ORDER
1. This petition under Article 226 of the Constitution of India has been filed
seeking the following reliefs :-
i) To call for the records of the case from the respondent nos.1 to 3
for kind perusal of this Hon'ble Court.
ii) To quash all agreements executed under Anndoot Yojna in
Annexure P/3 and similar agreements of others by issuance of a
writ of certiorari and or any other appropriate writ or direction.
iii) To command the respondents 1 to 3 to allow the work of
transportation to the petitioner under Anndoot Yojna on his own
rate of Rs.329 per quintal by issuance of a writ of mandamus or
any other order.
iv) To Issue any other writ, order or direction as this Hon'ble Court
deems just and proper and also grant cost of the petition.
2. It is submitted by counsel for the petitioner that he was granted a contract
for transportation under the 'Dwar Supply Scheme' and his contract of
transportation of food grains was valid up to 31.12.2023. In the
meanwhile, another scheme, namely, 'Annadoot Scheme', was floated
and tender was invited for transporting food grains under the 'Annadoot
Scheme'. Athough, the petitioner did not participate in the said tender,
but tender has been awarded to the respondents at a higher price than the
price at which the petitioner was performing his contract under the 'Dwar
Supply scheme'.
3. It is submitted that, since the petitioner is ready to carry out the
transportation work at the reduced rate, therefore, the contract awarded in
favour of the respondents be quashed.
4. Heard the learned counsel for the petitioner.
5. This Court can interfere in the contractual matters only when the decision
making process is found to be bad and vitiated.
6. The Supreme Court in the case of Uflex Limited Vs. Government of
Tamil Nadu and others reported in (2022) 1 SCC 165 has held as
under:-
"2. The judicial review of such contractual
matters has its own limitations. It is in this context
of judicial review of administrative actions that
this Court has opined that it is intended to prevent
arbitrariness, irrationality, unreasonableness, bias
and mala fides. The purpose is to check whether
the choice of decision is made lawfully and not to
check whether the choice of decision is sound. In
evaluating tenders and awarding contracts, the
parties are to be governed by principles of
commercial prudence. To that extent, principles of
equity and natural justice have to stay at a
distance. [Jagdish Mandal v. State of Orissa,
(2007) 14 SCC 517].
3. We cannot lose sight of the fact that a
tenderer or contractor with a grievance can always
seek damages in a civil court and thus, "attempts
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". [Jagdish Mandal v. State of Orissa,
(2007) 14 SCC 517]
7. The Supreme Court in the case of Caretel Infotech Ltd. Vs. Hindustan
Petroleum Corporation Limited and others reported in (2019) 14 SCC
81 has held as under:-
37. We consider it appropriate to make
certain observations in the context of the nature of
dispute which is before us. Normally parties
would be governed by their contracts and the
tender terms, and really no writ would be
maintainable under Article 226 of the Constitution
of India. In view of Government and public sector
enterprises venturing into economic activities, this
Court found it appropriate to build in certain
checks and balances of fairness in procedure. It is
this approach which has given rise to scrutiny of
tenders in writ proceedings under Article 226 of
the Constitution of India. It, however, appears that
the window has been opened too wide as almost
every small or big tender is now sought to be
challenged in writ proceedings almost as a matter
of routine. This in turn, affects the efficacy of
commercial activities of the public sectors, which
may be in competition with the private sector.
This could hardly have been the objective in
mind. An unnecessary, close scrutiny of minute
details, contrary to the view of the tendering
authority, makes awarding of contracts by
government and public sectors a cumbersome
exercise, with long drawn out litigation at the
threshold. The private sector is competing often in
the same field. Promptness and efficiency levels
in private contracts, thus, often tend to make the
tenders of the public sector a non-competitive
exercise. This works to a great disadvantage to the
Government and the public sector.
38. In Afcons Infrastructure Ltd. v. Nagpur
Metro Rail Corpn. Ltd. (2016) 16 SCC 818, this
Court has expounded further on this aspect, while
observing that the decision-making process in
accepting or rejecting the bid should not be
interfered with. Interference is permissible only if
the decision-making process is arbitrary or
irrational to an extent that no responsible
authority, acting reasonably and in accordance
with law, could have reached such a decision. It
has been cautioned that constitutional courts are
expected to exercise restraint in interfering with
the administrative decision and ought not to
substitute their view for that of the administrative
authority. Mere disagreement with the decision-
making process would not suffice.
39. Another aspect emphasised is that the
author of the document is the best person to
understand and appreciate its requirements. In the
facts of the present case, the view, on interpreting
the tender documents, of Respondent 1 must
prevail. Respondent 1 itself, appreciative of the
wording of Clause 20 and the format, has taken a
considered view. Respondent 3 cannot compel its
own interpretation of the contract to be thrust on
Respondent 1, or ask the Court to compel
Respondent 1 to accept that interpretation. In fact,
the Court went on to observe in the aforesaid
judgment that it is possible that the author of the
tender may give an interpretation that is not
acceptable to the constitutional court, but that
itself would not be a reason for interfering with
the interpretation given. We reproduce the
observations in this behalf as under: (Afcons
Infrastructure Ltd. case [Afcons Infrastructure
Ltd. v. Nagpur Metro Rail Corpn. Ltd., (2016) 16
SCC 818] , SCC p. 825, para 15)
"15. We may add that the owner
or the employer of a project,
having 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
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
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."
40. We may also refer to the judgment of
this Court in Nabha Power Ltd. v. Punjab State
Power Corpn. Ltd., (2018) 11 SCC 508 : (2018) 5
SCC (Civ) 1, authored by one of us (Sanjay
Kishan Kaul, J.). The legal principles for
interpretation of commercial contracts have been
discussed. In the said judgment, a reference was
made to the observations of the Privy Council
in Attorney General of Belize v. Belize Telecom
Ltd. [Attorney General of Belize v. Belize Telecom
Ltd., (2009) 1 WLR 1988 : 2009 Bus LR 1316
(PC)] as under: (Nabha Power Ltd. case [Nabha
Power Ltd. v. Punjab State Power Corpn. Ltd.,
(2018) 11 SCC 508 : (2018) 5 SCC (Civ) 1] , SCC
pp. 534-36, para 45)
"45. ... '16. Before discussing
in greater detail the reasoning of
the Court of Appeal, the Board
will make some general
observations about the process of
implication. The court has no
power to improve upon the
instrument which it is called upon
to construe, whether it be a
contract, a statute or articles of
association. It cannot introduce
terms to make it fairer or more
reasonable. It is concerned only
to discover what the instrument
means. However, that meaning is
not necessarily or always what
the authors or parties to the
document would have
intended....
***
19. ... In Trollope & Colls
Ltd. v. North West Metropolitan
Regional Hospital
Board [Trollope & Colls
Ltd. v. North West Metropolitan
Regional Hospital Board, (1973)
1 WLR 601 (HL)] Lord Pearson,
with whom Lord Guest and Lord
Diplock agreed, said: (WLR p.
609 B-D)
"...the court does not make a contract
for the parties. The court will not even
improve the contract which the parties
have made for themselves, however
desirable the improvement might be.
The court's function is to interpret and
apply the contract which the parties
have made for themselves. If the
express terms are perfectly clear and
free from ambiguity, there is no
choice to be made between different
possible meanings: the clear terms
must be applied even if the court
thinks some other terms would have
been more suitable. An unexpressed
term can be implied if and only if the
court finds that the parties must have
intended that term to form part of their
contract: it is not enough for the court
to find that such a term would have
been adopted by the parties as
reasonable men if it had been
suggested to them: it must have been a
term that went without saying, a
term necessary to give business
efficacy to the contract, a term which,
though tacit, formed part of the
contract which the parties made for
themselves."...' (Attorney General of
Belize case [Attorney General of
Belize v. Belize Telecom Ltd., (2009) 1
WLR 1988 : 2009 Bus LR 1316 (PC)]
, WLR pp. 1993 A-B, F-H & 1994 A,
paras 16 & 19)"
(emphasis in original)
41.Nabha Power Ltd. [Nabha Power
Ltd. v. Punjab State Power Corpn. Ltd., (2018) 11
SCC 508 : (2018) 5 SCC (Civ) 1] also took note
of the earlier judgment of this Court in Satya
Jain v. Anis Ahmed Rushdie [Satya Jain v. Anis
Ahmed Rushdie, (2013) 8 SCC 131 : (2013) 3
SCC (Civ) 738] , which discussed the principle of
business efficacy as proposed by Bowen, L.J.
in The Moorcock [The Moorcock, (1889) LR 14
PD 64 (CA)] . It has been elucidated that this test
requires that terms can be implied only if it is
necessary to give business efficacy to the contract
to avoid failure of the contract and only the bare
minimum of implication is to be there to achieve
this goal. Thus, if the contract makes business
sense without the implication of terms, the courts
will not imply the same.
42. The judgment in Nabha Power
Ltd. [Nabha Power Ltd. v. Punjab State Power
Corpn. Ltd., (2018) 11 SCC 508 : (2018) 5 SCC
(Civ) 1] concluded with the following
observations in para 72: (SCC p. 546)
"72. We may, however, in the end,
extend a word of caution. It should
certainly not be an endeavour of
commercial courts to look to
implied terms of contract. In the
current day and age, making of
contracts is a matter of high
technical expertise with legal
brains from all sides involved in
the process of drafting a contract.
It is even preceded by
opportunities of seeking
clarifications and doubts so that
the parties know what they are
getting into. Thus, normally a
contract should be read as it reads,
as per its express terms. The
implied terms is a concept, which
is necessitated only when the
Penta test referred to aforesaid
comes into play. There has to be a
strict necessity for it. In the
present case, we have really only
read the contract in the manner it
reads. We have not really read into
it any "implied term" but from the
collection of clauses, come to a
conclusion as to what the contract
says. The formula for energy
charges, to our mind, was quite
clear. We have only expounded it
in accordance to its natural
grammatical contour, keeping in
mind the nature of the contract."
43. We have considered it appropriate to,
once again, emphasise the aforesaid aspects,
especially in the context of endeavours of courts
to give their own interpretation to contracts, more
specifically tender terms, at the behest of a third
party competing for the tender, rather than what is
propounded by the party framing the tender. The
object cannot be that in every contract, where
some parties would lose out, they should get the
opportunity to somehow pick holes, to disqualify
the successful parties, on grounds on which even
the party floating the tender finds no merit.
8. The Supreme Court in the case of Tata Cellular Vs. Union of India
reported in (1994) 6 SCC 651 has held as 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 fides.
(6) Quashing decisions may impose heavy
administrative burden on the administration and
lead to increased and unbudgeted expenditure.
Based on these principles we will examine
the facts of this case since they commend to us as
the correct principles.
9. It is well established principle of law that a writ petition for enforcement
of contract is not maintainable. The Supreme Court in the case of Surjeet
Singh Sahni Vs. State of U.P. and Ors. by order dated 28.02.2022
passed in SLP(C) No.3008/2022 has held as under:-
"6.........No writ under Article 226 of the
Constitution of India shall be maintainable and/or
entertainable for specific performance of the
contract........."
10. During the course of arguments, the petitioner has not challenged any
drawback in the procedure which was adopted by the respondents for
accepting the tender for transportation of foodgrains under the 'Annadoot
scheme'. His only contention is that he was performing the same
contract under the 'Dwar supply scheme' at a lower rate. Therefore, he
should be granted the said contract. However, counsel for the petitioner
was repeatedly asked to justify as to whether this Court can quash the
tender on the ground that since somebody is ready to execute a contract
at a lower price, then it was again and again submitted by counsel for the
petitioner that, since the public exchequer was involved, therefore, this
Court can look into the aspect as to whether the contract was awarded at
a higher price or not.
11. Unfortunately, the submission made by counsel for the petitioner is
beyond the jurisdiction of judicial review in contractual matters.
12. Since no infirmity in the process adopted by the respondents could be
pointed out by counsel for the petitioner, No case is made out warranting
interference.
13. The petition fails and is hereby dismissed.
(G.S. AHLUWALIA)
JUDGE
HEMANT SARAF
2024.05.03 15:34:19
+05'30'
HS
