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The power of judicial review will not be permitted to be invoked to protect private interest at the cost of public interest, or to decide contractual disputes: The High Court of Orissa

If the decision relating to award of contract is bona fide and is in public interest, courts will not, in exercise of power of judicial review, interfere even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. The above statement has been established by the Supreme Court in the case of Jagdish Mandal v. State of Orissa (2007) 14 SCC 517 and has laid the premise for the Orissa High Court while giving its verdict in the case of M/s.I.V.T.V.L.T.(J.V.) v. Chairman-cum-Managing Director, MCL and others [WRIT PETITION (CIVIL) No.4500 OF 2021]. Being an application under articles 226 and 227 of the Constitution of India, the matter was decided by the Chief Justice, Justice B.P. Routray on 4th June 2021.

The Petitioner is a joint venture company. He along with Opposite Party No.3 and others participated in the bidding process invited by Opposite Party Nos.1 and 2, i.e., Mahanadi Coal Fields Limited (MCL) vide Notice Inviting Tender (NIT) No.818/2020/657 dated 28th October, 2020 for the work “Hiring of Pay Loaders for Mechanical transfer of Coal into Railway wagons at Siding No.VI & VII of Lakhanpur Area for a quantity of 3,83,25,000 Te.” And there were certain eligibility criterias laid down for the same. The petitioner is of the opinion that opposite party no. 3 does not qualify certain eligibility criterias and hence should not be given the bid. They contended the disqualification of opposite party no. 3 on the grounds that the annualized value of the estimated cost comes to Rs.4,18,31,738/-. Whereas as per the work experience certificate of Opposite Party No.3 filed at Annexure-3 to the tune of Rs.6,00,72,502/- is not matching with the work order submitted by Opposite Party No.3 which has been annexed under Annexure-3 series. Therefore, the work experience certificate of Opposite Party No.3 is not a genuine document. In order to refute this, it was contended by the respondents that Petitioner has not presented the correct facts in the writ petition and that opposite party no. 3 duly qualifies this eligibility criteria. The next contention of the Petitioner is that the clarification issued by M/s.Shyam Metalics and Energy Limited was on 12th December, 2020 whereas the price bids were opened on 7th December, 2020. There is no merit in this contention in view of the clear averment of Opposite Party No.2 in their reply that after ascertaining the genuineness of the work experience certificate from the concerned employer, a decision was taken by the Tender Committee.

Considering the facts and arguments presented, the court showcased sufficient reliance on the Supreme Court’s statements in the case of Jagdish Mandal v. State of Orissa (2007) 14 SCC 517 which gave the opinion that “A contract is a commercial transaction. Evaluating tenders and awarding contracts are essentially commercial functions. Principles of equity and natural justice stay at a distance. If the decision relating to award of contract is bona fide and is in public interest, courts will not, in exercise of power of judicial review, interfere even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. The power of judicial review will not be permitted to be invoked to protect private interest at the cost of public interest, or to decide contractual disputes.” Keeping in mind the apex Court’s decision, the Orissa High court gave the following verdict “In light of the settled legal position as explained by the Supreme Court in the aforementioned decisions, there is no merit in the contentions of the Petitioner. Accordingly, the writ petition is dismissed. There shall be no order as to costs.”

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