Tata Cellular v. Union of India, (1994) 6 SCC 651, Paragraph 94 states, “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.” Afcons Infrastructure Ltd. v. Nagpur Metro Rail Corpn. Ltd., (2016) 16 SCC 818 has laid down, “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. 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 Constitutional Courts but that by itself is not a reason for interfering with the interpretation given.” This view of law has been subsequently followed repeatedly. See, Montecarlo Ltd. v. NTPC Ltd., (2016) 15 SCC 272 [Paragraph 25], Caretel Infotech Ltd. v. Hindustan Petroleum Corpn. Ltd., (2019) 14 SCC 81 [Paragraphs 38 and 39] and State of Madhya Pradesh v. U.P. State Bridge Corporation Ltd., 2020 SCC OnLine SC 1001 [Paragraphs 24 to 26]. Galaxy Transport Agencies v. New J.K. Roadways, 2020 SCC OnLine SC 1035 after referring to Paragraph 15 of Afcons held, “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.”

High Court has not adverted to any of these decisions and has clearly overstepped bounds of judicial review in such matters.

– Hon’ble Justice R.F. Nariman, M/s. Utkal Suppliers v. M/s. Maa Kanak Durga Enterprises, [Civil Appeal Nos. 1517-1518 of 2021].

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Harshit Agarwal v. Union of India, (2021) 2 SCC 71 held, judicial review of administrative action is permissible on grounds of illegality, irrationality and procedural impropriety. An administrative decision is considered as flawed if it is illegal, and a decision is illegal if it pursues an objective other than that for which the power to make the decision was conferred. The discretion exercised by the decision maker is subject to judicial scrutiny if a purpose other than the specified purpose is pursued.

– Hon’ble Justice Hemant Gupta, Punjab State Co-operative Milk Producers Federation Ltd. v. Balbir Kumar Walia, [Civil Appeal No. 7427 of 2011] decided on 09.07.2021.

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In evaluating tenders and awarding contracts, 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. We cannot lose sight, a tenderer or contractor with a grievance can always seek damages in a Civil Court and thus, “attempts by unsuccessful tenderers… to make mountains out of molehills of some technical/procedural violation… and persuade Courts to interfere… should be resisted” [Jagdish Mandal v. State of Orissa, (2007) 14 SCC 517].

Burgeoning litigation in this field caused an epilogue in Caretel Infotech Ltd. v. Hindustan Petroleum Corporation Limited, (2019) 14 SCC 81.

Economics must be permitted to play its role for which tendering authority knows best as to what is suited in terms of technology and price for them.

– Hon’ble Justice Sanjay Kishan Kaul, Uflex Ltd. v. Government of Tamil Nadu, [Civil Appeal No. 4862-4863 of 2021] decided on 17.09.2021.

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It is pertinent to examine, role of Constitutional Courts in reviewing a tender process. An observation of judicial restraint while reviewing such contracts is a continuing trend which can be seen in a catena of cases.

Often, parties entertain an idea of a long­-drawn-­out litigation. The purpose of imbibing ‘spirit of competition’, in a process such as that of a bidding process, is lost in this meandering exercise and delays suffered.

The object of judicial review cannot be, in every contract where some parties lose out, a second opportunity is provided to such parties to pick holes so as to disqualify successful parties.

– Hon’ble Chief Justice of India, Hon’ble Justice N.V. Ramana, City and Industrial Development Corporation of Maharashtra v. Shishir Realty Private Limited, [Civil Appeal No. 3956-­3957 of 2017] decided on 29.11.2021.

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It would suffice to refer to 3-Judge Bench decision of this Court in Galaxy Transport Agencies v. New J.K. Roadways, 2020 SCC OnLine SC 1035 wherein, among others, Afcons Infrastructure Ltd. v. Nagpur Metro Rail Corpn. Ltd., AIR 2016 SC 4305 has also been considered.

The author of a tender document is taken to be the best person to understand and appreciate its requirements; and if its interpretation is manifestly in consonance with the language of the tender document or subserving the purchase of the tender, Court would prefer to keep restraint. Further, technical evaluation or comparison by Court is impermissible; and even if an interpretation given to a tender document by the person inviting offers is not as such acceptable to Constitutional Courts, that, by itself, would not be a reason for interfering with the interpretation given.

– Hon’ble Justice Dinesh Maheshwari, M/s. Agmatel India Pvt. Ltd. v. M/s. Resoursys Telecom, [Civil Appeal No. 786 of 2022] decided on 31.01.2022.

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The scope of judicial review in matters of tenders/public auction has been explored in depth by this Court in a catena of cases. Plausible decisions need not be overturned and latitude ought to be granted to State. However, allegations of illegality, irrationality and procedural impropriety would be enough grounds for Courts to assume jurisdiction and remedy such ills.

It was consistently stressed by this Court, need for overwhelming public interest should always be kept in mind to justify judicial intervention in contracts involving State and its instrumentalities and while exercising power of judicial review in relation to contracts.

See, Jagdish Mandal v. State of Orissa, (2007) 14 SCC 517; Silppi Constructions Contractors v. Union of India, (2020) 16 SCC 489.

– Hon’ble Justice Ajay Rastogi, State of Punjab v. Mehar Din, [Civil Appeal No. 5861 of 2009] decided on 02.03.2022.

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The approach of Court should be not to find fault with magnifying glass in its hands, rather Court should examine whether the decision-making process is after complying with the procedure contemplated by the tender conditions. If there is total arbitrariness or a tender has been granted in a mala fide manner, still Court should refrain from interfering in the grant of tender but instead relegate parties to seek damages for wrongful exclusion rather than to injunct execution of contract.

– Hon’ble Justice Hemant Gupta, M/s. N.G. Projects Limited v. M/s. Vinod Kumar Jain, [Civil Appeal No. 1846 of 2022] decided on 21.03.2022.  

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In view of City and Industrial Development Corporation of Maharashtra v. Shishir Realty Private Limited, Civil Appeal No. 3956-­3957 of 2017 it is apparent, Government contracts, granted by Government bodies, is expected to uphold fairness, equality and rule of law. Right to equality under Article 14 abhors arbitrariness. A transparent bidding process is favored by Court to ensure, constitutional requirements are satisfied.

– Hon’ble Justice Vineet Saran and Hon’ble Justice J.K. Maheshwari, MIHAN India Limited v. GMR Airports Limited, [Civil Appeal No. 3699 of 2022] decided on 09.05.2022.

Also see, Banshidhar Construction Pvt. Ltd. v. Bharat Coking Coal Limited, [Civil Appeal No. 11005 of 2024] decided on 04.10.2024.

The ‘heart beat of fair play’ in tender matters is non-arbitrariness and fairness in State action. Court’s interference is limited to cases where decision making process is shown to be arbitrary, irrational, mala fide or contrary to public interest. [Michigan Rubber (India) Ltd. v. State of Karnataka, (2012) 8 SCC 216]. Banshidhar Construction Pvt. Ltd. v. Bharat Coking Coal Ltd., (2024) 10 SCC 273 reiterated, decisions of Government must be free from arbitrariness and guided by constitutional mandate contained in Article 14.

– Hon’ble Justice Alok Aradhe, M/s. Shanti Construction Pvt. Ltd. v. State of Odisha, [Special Leave Petition (Civil) No. 5829 of 2033] decided on 07.11.2025.

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Constitution Bench of this Court in C.K. Achuthan v. State of Kerala, AIR 1959 SC 490 held, it is open to Government to choose a person to their liking, to fulfil contracts which they wish to be performed. Court observed, when one party is chosen over another, the aggrieved party cannot claim protection of Article 14 since Government has discretion to choose with whom it will contract.

Over the years, Court has applied the non-arbitrariness standard. Government action must be just, fair and reasonable and in accordance with principles of Article 14. Government can deviate from route of tenders or public auctions for grant of contracts. But, the deviation has to be justified.  

– Hon’ble Chief Justice of India, Hon’ble Justice Dr. D.Y. Chandrachud, Indian Medicines Pharmaceuticals Corporation Ltd. v. Kerala Ayurvedic Co-operative Society Ltd., [Civil Appeal No. 6693 of 2022] decided on 03.01.2023.

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Courts must realise their limitations and the havoc which needless interference in commercial matters can cause. Courts should not use a magnifying glass and make every small mistake appear like a big blunder. Court should always keep larger public interest in mind in order to decide whether its intervention is called for or not.

– Hon’ble Justice J.B. Pardiwala, Tata Motors v. Brihan Mumbai Electric Supply & Transport Undertaking, [Civil Appeal  No. 3897 of 2023] decided on 19.05.2023.

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City and Industrial Development Corporation of Maharashtra v. Shishir Realty Private Limited, (2022) 16 SCC 527 reiterated, Article 14, which abhors arbitrariness, imposes a duty on public authorities to ensure bias or favouritism does not infiltrate a bidding process. A transparent bidding process is essential to fulfil constitutional obligations.

– Hon’ble Justice Surya Kant, NOIDA Toll Bridge Company Ltd. v. Federation of NOIDA Residents Welfare Association, [Special Leave Petition (Civil) No. 33403 of 2016] decided on 20.12.2024.  

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Doctrine of Level Playing Field requires, gates of competition be opened to all who are equally placed. The impugned tender condition excludes competent and experienced suppliers, who may have executed contracts of far greater magnitude. The impugned condition operates as a closed door to outsiders and restricts wider participation of bidders. The impugned tender condition is violative of Article 14 and also offends Article 19(1)(g).

The justification advanced – Chhattisgarh being a Maoist affected area, only those with past experience of supply can be relied upon – is untenable for several reasons. The tender in question is for supply of sports kits which does not involve any special risk or security repercussions. It is incorrect to treat entire State as uniformly affected by Naxalites, for exclusion of other eligible bidders.

– Hon’ble Justice Alok Aradhe, Vinishma Technologies Pvt. Ltd. v. State of Chhattisgarh, [Special Leave Petition (Civil) No. 24075 of 2025] decided on 06.10.2025.

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As per Oxford Hindi-English Dictionary, English translation of ‘haisiyat’ is ‘capacity, ability, means or resources’. No doubt from such perspective, ‘haisiyat praman patra’ would be understood as net worth of bidder.

– Hon’ble Justice Joymalya Bagchi, Kimberly Club Pvt. Ltd. v. Krishi Utpadan Mandi Parishad, [Special Leave Petition (Civil) No. 20557/2022] decided on 31.10.2025.