M/S. Raghavendra Securities vs. The State Of Andhra Pradesh

Held

The Court held that the petitioner's argument regarding the lack of newspaper publication for the tender notification was not sustainable. It reasoned that electronic tendering is intended to cut costs and reach a wider group of bidders, allowing multiple vendors to respond electronically, leading to more competitive rates. Therefore, the absence of newspaper publication was not considered arbitrary. Regarding the turnover condition of Rs. 4 crores, the Court found it to be arbitrary and directed the respondents to delete this specific condition. However, the Court noted that the petitioner had not pleaded whether they met the other eligibility criteria, such as registration under the Private Security Agencies (Regulation) Act, 2005, and possessing a valid labour license, ESI, EPF, GST registration, and PAN. Since the petitioner did not demonstrate fulfillment of these other conditions, the writ petition could not be allowed solely for deleting the turnover condition. The Court also considered the argument of non-maintainability of the writ petition against a cooperative society, noting that judicial review in contractual matters is limited. Ultimately, finding the writ petition to be without merit, the Court dismissed it.

Facts

The petitioner, M/s. Raghavendra Securities, sought a writ of mandamus to declare the tender notification dated July 19, 2024, issued by the Krishna District Cooperative Central Bank Ltd. (2nd respondent) for security services as illegal and arbitrary. The petitioner contended that the tender was not published in regional newspapers, only uploaded on the bank's website, and that a new condition regarding turnover was imposed to exclude them. The petitioner had previously held a contract for security services from December 1, 2021, to November 30, 2022, with extensions. A previous writ petition (WP No. 2666 of 2024) had directed the bank to invite fresh tenders. The bank argued that the petitioner participated in an earlier e-tender and could not now demand newspaper publication, and that tender conditions are not arbitrary. The bank also raised the issue of writ maintainability against a cooperative society.

Key Issues

1. Whether the action of the 2nd respondent in issuing the tender notification dated July 19, 2024, without publishing it in regional newspapers, thereby uploading it only on the website, is illegal, arbitrary, and violative of Article 14 of the Constitution of India, as argued by the petitioner. 2. Whether the imposition of a new condition requiring tenderers to have a turnover of not less than 4 crores in any one of the last three financial years is arbitrary and designed to prevent the petitioner from participating, as contended by the petitioner. 3. Whether the writ petition is maintainable against the Krishna District Cooperative Central Bank Ltd., a cooperative society, as argued by the 2nd respondent. Petitioner's Arguments: The petitioner argued that the lack of wider advertisement in print media (newspapers) and the imposition of the turnover condition were arbitrary and designed to exclude them, violating Article 14 and previous court orders. They relied on the court's observation in WP No. 2666 of 2024 that not inviting tenders through proper advertisement is arbitrary. Revenue/State Arguments: The 2nd respondent (Bank) argued that the petitioner previously participated in an e-tender and cannot now demand newspaper publication. They asserted that tender conditions were not made to favor anyone and that the writ petition is not maintainable against a cooperative society, citing judgments like Sri Konaseema Co-operative Central Bank Ltd. vs. N. Seetharama Raju.