The Madras High Court has dismissed a public interest litigation challenging the Tamil Nadu Medical Service Corporation Limited’s award of a contract to Joyalukkas India Limited for supplying 4,41,667 one-gram, 22-carat gold rings under the Tamil Nadu Government’s “Thaimaman Thanga Mothiram Thittam” welfare scheme.
A Division Bench comprising Chief Justice Sushrut Arvind Dharmadhikari and Justice G. Arul Murugan held that the petitioner had not established the arbitrariness, mala fides or irrationality required for judicial interference in a government tender.
Background of the Case
Raj.G, who described himself as a goldsmith, challenged the Award of Contract dated August 21, 2026 and the consequential Letter of Acceptance issued in favour of Joyalukkas.
The tender was floated on July 13, 2026. After two corrigenda, the price schedule was changed to a composite “charges per ring” figure, excluding the actual price of gold, which was to be paid separately at the prevailing IBJA rate.
Eleven bids were received. Joyalukkas emerged as L1 with a quoted charge of Rs.0.01 per ring. Nine other bidders did not match the rate, while Kalyan Jewellers matched it, reducing its earlier quotation of Rs.978.50 to Rs.0.01.
The petitioner argued that a one-paisa quotation could not realistically cover the various costs involved in supplying the rings. He also questioned the authority of TNMSC to procure gold articles, relying on its Memorandum of Association.
However, the petitioner did not challenge the welfare scheme, the tender conditions, the revised price schedule or Clause 5.7 under which the L1 rate was considered.
Court’s Observation
The Bench stressed that judicial review in tender matters is limited. Referring to Supreme Court precedents, the Court noted that judges do not sit as an appellate authority over commercial decisions taken by the government and its tendering authorities.
“Once the terms by which L1 was to be identified and accepted are left standing, a court exercising a narrow supervisory jurisdiction cannot readily strike down the outcome those very terms produce.”
The Court also found an inconsistency in the petitioner’s case. While arguing that TNMSC lacked authority to deal with gold jewellery, the petitioner had simultaneously sought a direction for the same authority to conduct a fresh procurement through a competent procuring entity.
Decision
The Bench further observed that the petitioner was not a tenderer and had no direct personal stake in the award. None of the unsuccessful tenderers had challenged the contract.
The Court concluded that the award and Letter of Acceptance did not suffer from the level of arbitrariness, mala fides or irrationality necessary for interference under Article 226 of the Constitution.
The writ petition was dismissed, with no order as to costs. The connected interim application was also closed.
