Allahabad High Court Upholds Tender Award Amidst Allegations of Procedural Irregularities

Court dismisses Kasana Builders' petition, emphasizing limited judicial review in tender processes and prioritizing public interest.

In a significant ruling, the Allahabad High Court, Lucknow Bench, dismissed a writ petition filed by Kasana Builders Pvt. Ltd., challenging the acceptance of a financial bid by G.S. Express Pvt. Ltd. The case, adjudicated by Justices Shekhar B. Saraf and Manjive Shukla, revolved around a tender issued by the Planning Department of Uttar Pradesh for the construction of residences for judges and bungalows in Lucknow and Prayagraj.

Kasana Builders contended that G.S. Express was initially disqualified for not uploading a bank guarantee on the e-tender portal, a requirement they argued was mandatory. However, the court found this to be a technical irregularity, noting that the original document had been submitted physically and verified in time. The decision to allow G.S. Express to cure the defect was deemed in public interest and not mala fide or arbitrary.

The court underscored the limited scope of judicial review in tender matters, reiterating that intervention is warranted only in cases of gross arbitrariness, mala fide actions, or when public interest is at stake. It emphasized that procedural irregularities, if bona fide, do not merit interference, especially in infrastructure projects where delays could incur significant costs to the state.

Justice Saraf, referencing past Supreme Court judgments, highlighted that courts should refrain from imposing their decisions over those of the tendering authority unless overwhelming public interest necessitates such action. The judgment noted that Kasana Builders, having participated in the financial bid without prior objection, could not challenge the tender conditions post-facto, labeling their actions as impermissible afterthoughts.

The court's decision reflects a broader judicial philosophy of caution in tender-related disputes, prioritizing the timely execution of public projects over technical grievances. This ruling aligns with the Supreme Court's stance that judicial intervention in commercial matters should be exercised sparingly and only to further public interest.

Bottom Line:

Judicial review in tender matters is limited and courts should refrain from interfering unless there is gross arbitrariness, mala fide, or violation of public interest.

Statutory provision(s): Article 226 of the Constitution of India

Kasana Builders Pvt. Ltd. v. State of U.P., (Allahabad)(Lucknow)(DB) : Law Finder Doc Id # 2814013