The Supreme Court on April 25 clearly stated that courts should rarely interfere in matters related to government tenders. It emphasized that such interference is only allowed if there is clear evidence of dishonesty or serious unfairness.
A bench of Justice Bela M. Trivedi and Justice Prasanna B. Varale overturned a Kerala High Court order that had intervened in a forest department tender dispute. The case involved the Kerala Forest Department’s decision to cancel a previous e-tender dated May 25, 2020, for tree felling work in the Konni Forest Division. The department later issued a new tender on October 31, 2020.
The cancellation was based on complaints from contractors who were unable to participate due to COVID-19 restrictions. Several bidders who were affected by this move approached the Kerala High Court, claiming that the cancellation was unfair and deprived them of an equal opportunity.
Initially, a Single Judge and later a Division Bench of the High Court agreed with the bidders and ordered the department to go ahead with the original tender. The High Court also remarked that a fresh tender could not be issued merely to get a better price for the government.
However, the Supreme Court found this reasoning incorrect.
“We are of the opinion that the said observations by the High Court are contrary to the settled principles of law laid down by the Supreme Court that the Government is the protector of financial resources of the state and thus, it has every right to cancel and call for fresh tender if it is in the nature of protecting the financial interests of the State.” — Supreme Court
The judgment, authored by Justice Varale, referred to the Supreme Court’s earlier decision in Jagdish Mandal vs. State of Orissa & Others (2007), which clarified that courts can step in only when decisions are taken with bad intent, without reason, or to help someone unfairly.
Read Also:- Supreme Court: Landlord's Family Member's Need Is Also a Valid Ground for Tenant's Eviction
In this case, the Court observed that the department cancelled the tender to allow equal participation for those who missed the earlier chance due to the pandemic. This, the Court said, was a fair move in public interest.
“At the cost of repetition, we may state that the decision of the authority is giving a fresh opportunity to all interested bidders to compete with each other in the process of the fresh selection. In our opinion, the decision taken by the authority is not affecting the public interest, on the contrary it furthers the cause of the public interest and fair play.” — Supreme Court
As a result, the Supreme Court allowed the appeal and upheld the government's right to cancel and reissue the tender.
Case Title: The Principal Chief Conservator of Forest & Ors. vs. Suresh Mathew & Ors.
