M/S Abhinav Food Products And Anr vs. The State Of Ap And Anr

Facts

The petitioners, M/s Orion Health Foods Private Limited and others, challenged the terms and conditions, specifically Annexure-B (qualification points), of an e-tender notice issued by the Secretary, Women & Child Development Department, Government of Arunachal Pradesh. The tender was for the supply of Ready to Eat (RTE) food items, including fortified Rice and Pulse Based Energy Food, Kheer, and Puffed Rice, with an estimated cost of Rs. 1000 Lakhs. The tender process involved a two-bid system (Technical and Price/Financial). The petitioners argued that certain qualification points were arbitrary and unreasonable. The State of Arunachal Pradesh, represented by its Secretary and Director, defended the tender conditions, asserting their reasonableness and adherence to established tender procedures. The judgment consolidated multiple writ petitions due to similar factual backgrounds and legal issues.

Held

The Court held that the terms and conditions of the tender, including the qualification points prescribed in Annexure-B of the NIeT dated 20.02.2024, were reasonable. The Court reasoned that the author of the tender document is the best judge of its requirements, and the interpretation of the tendering authority should be given due deference. It was established law that courts should refrain from interfering with tender conditions unless they are tailor-made to favor specific bidders, manifestly arbitrary, or unreasonable. The Court found no overwhelming public interest or evidence to suggest that the qualification points were incorporated to favor particular bidders or were malafide. The Court cited Supreme Court decisions emphasizing that judicial relief should not be granted to parties who do not fulfill the requisite criteria and that courts should exercise caution in interfering with contractual matters, especially when the decision-making process is not arbitrary or malafide. The Court concluded that the action of the respondent authority did not suffer from manifest illegality, arbitrariness, or malafide.

Key Issues

1. Whether the qualification points prescribed in Annexure-B of the Notice Inviting e-Tender (NIeT) dated 20.02.2024, issued by the Women & Child Development Department, Government of Arunachal Pradesh, are arbitrary, unreasonable, and manifestly illegal, thereby warranting interference under Article 226 of the Constitution. Petitioner's arguments: The petitioners contended that the qualification points, particularly those relating to average turnover (Serial No. 4), experience in other states (Serial No. 5), and net worth (Serial No. 8), were arbitrary, unreasonable, and designed to favour certain bidders, thus violating principles of fairness and competition. They argued that these conditions were not essential for the successful execution of the contract and amounted to an unfair exclusion of eligible manufacturers. Revenue/State's arguments: The State argued that the qualification points were reasonable and necessary to ensure the financial capability and experience of the bidders for a contract of this magnitude. They contended that the tender authority is the best judge of its requirements and that the terms were not tailor-made to favour any specific bidder or were arbitrary. They relied on Supreme Court judgments emphasizing judicial restraint in contractual matters and tender evaluations.