The Allahabad High Court recently held that judicial interference in infrastructure tender processes on mere technical or procedural grounds can lead to significant losses to the State exchequer, and such intervention must be reserved for cases where there is evidence of arbitrariness, mala fide intent or manifest irrationality. The court observed that attempts by unsuccessful bidders to invoke writ jurisdiction, on the basis of minor or purely technical irregularities, often stem from wounded commercial pride rather than genuine legal grievances.
In the case before it, a bidder engaged in road-construction business challenged the rejection of its bid and the subsequent award of the contract to another firm. The petitioner alleged that the successful bidder was improperly allowed to participate despite the petitioner having raised objections at the technical evaluation stage. The State authority, however, maintained that the tender process followed the published norms and the successful bidder was selected after full evaluation of technical and financial bids. The High Court examined leading precedents from the Supreme Court emphasizing that the authority which authorises and issues the tender documents is best placed to interpret eligibility criteria and technical requirements, and courts should only intervene if the decision-making process is shown to be arbitrary or so perverse that no reasonable authority could have reached it.
The bench stressed that infrastructure contracts are commercial in nature and require technical expertise, assessment of risk, pricing, capability and execution capacity. The court noted that substituting a bidder’s technical interpretation, or conducting a re-evaluation of technical qualifications, may amount to judicial overreach and jeopardise the timely execution of public works. The High Court held that where the tendering authority has followed procedure, given equal opportunity to bidders and has not acted with bias, courts should exercise restraint and not convert writ proceedings into appeals on the merits of bids.
The court further directed that when a petitioner claims procedural flaw, the burden is on the bidder to demonstrate that the flaw affected the decision-making in a manner that is arbitrary or violates fundamental principles of fairness. Mere non-compliance with non-essential or ancillary technical conditions, without shown prejudice, will not suffice for equitable interference. The judgment reiterated that even when a defect is shown, the court must assess whether public interest and the integrity of the project would be compromised by granting relief, and whether the error undermined the competitive process or caused manifest unfairness.
In conclusion, the High Court dismissed the petition, upholding the award of the contract to the successful bidder. The ruling underscores the importance of respecting the expertise of tender-inviting authorities, and affirms that courts should intervene only when the process suffers from illegality, bias, perversity or the decision is so irrational that no responsible authority could have adopted it.
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