G Suresh Kumar vs. The State Of Ap

Held

The Court dismissed the writ petition, finding no illegality, irregularity, or bias in the awarding of the tender to the sixth respondent. The Court noted that the respondent authority adhered to the procedure and awarded the tender in favor of the unofficial respondent (R6) after the petitioner had backed out of the contract. The Court cited established legal principles regarding the scope of judicial review in contractual matters, referencing cases like Tata Cellular v. Union of India and Kasturi Lai Lakshmi Reddy v. State of J & K. It reiterated that the Government has the right to refuse any tender and that the exercise of this power must be free from arbitrariness or favouritism. The Court emphasized that it cannot substitute its opinion for that of the administrative authority and is concerned with the manner in which the decision was taken, not its correctness. Given the facts presented, the Court concluded that the decision-making process was not flawed and that the petitioner had no merits in their claim.

Facts

The petitioner, G. Suresh Kumar, filed a writ petition challenging the allotment of Stall No.DB-1, a Hotel & Dormitory space, by the Andhra Pradesh Public Transport Department (APSRTC) to the sixth respondent. The tender notification was issued on March 13, 2025. The petitioner participated and was the second highest bidder, quoting Rs. 45,67,899.99. The first highest bidder failed to pay the requisite amount, leading to the cancellation of their allotment. The petitioner was then called for negotiations and increased their bid to Rs. 45,68,400. However, the APSRTC allegedly clandestinely allotted the stall to the sixth respondent, who was the third highest bidder, for Rs. 46,01,000. The petitioner contended that this action was illegal, arbitrary, and violative of natural justice and constitutional principles. The respondents, in their counter-affidavit, stated that the tender process was transparent and that the first highest bidder failed to deposit the license fee along with GST.

Key Issues

1. Whether the action of the respondents in allotting Stall No.DB-1 to the sixth respondent, despite the petitioner being the second highest bidder and having participated in negotiations, is illegal, arbitrary, and violative of principles of natural justice and Articles 14, 19(1)(g), 21, and 300-A of the Constitution of India? Petitioner's arguments: The petitioner argued that the allotment to the sixth respondent was clandestine and arbitrary, as they were the second highest bidder and had increased their bid during negotiations. They contended that the respondents ought to have re-notified the tender instead of allotting it to the third highest bidder. The petitioner also claimed they were not given an opportunity of hearing before the allotment to the sixth respondent. Respondents' arguments: The respondents argued that the tender process was transparent and followed the published terms and conditions. They stated that the first highest bidder failed to deposit the license fee. The respondents also relied on judicial precedents regarding the scope of judicial review in contractual matters, emphasizing that the authority has the right to accept or refuse any tender, even if it's not the highest, provided there are good and sufficient reasons and the decision is free from arbitrariness or favouritism. They asserted that the petitioner backed out of the contract after the first highest bidder's failure.