Judicial restraint in tender review: bona fide commercial assessment and contemporaneous material justified rejection of both bids.

Judicial review in public tender matters is confined to illegality, arbitrariness, irrationality, mala fides and public interest concerns, and courts will not re-evaluate commercial or technical assessments. Applying that restraint, the rejection of the first stretch bid was upheld because the earnest money deposit was found invalid on contemporaneous material, and the authority was entitled to treat the bid as non-responsive without further enquiry. The rejection of the second stretch bid was also upheld because the quoted rate was assessed as absurdly low and commercially unworkable, making performance unreliable. The authority's bona fide commercial judgment was therefore not open to substitution in judicial review.

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Issues: (i) Whether interference in the award of public contracts in judicial review is justified absent arbitrariness, mala fides, irrationality, or public interest concerns; (ii) Whether rejection of the first stretch tender on the ground that the earnest money deposit was invalid was arbitrary; (iii) Whether rejection of the second stretch tender on the ground of an unduly low and unworkable quoted rate was arbitrary.

Issue (i): Whether interference in the award of public contracts in judicial review is justified absent arbitrariness, mala fides, irrationality, or public interest concerns

Analysis: Judicial review of tender and contract awards is confined to examining the decision-making process, not the merits of the commercial decision. The controlling considerations are whether the authority acted fairly, rationally, without bias, without mala fides, and in public interest. Courts do not sit in appeal over technical assessments in commercial matters and must exercise restraint, especially where interference may disrupt public projects.

Conclusion: Interference is not justified unless the decision is shown to be mala fide, arbitrary, irrational, or contrary to public interest.

Issue (ii): Whether rejection of the first stretch tender on the ground that the earnest money deposit was invalid was arbitrary

Analysis: The tender conditions required valid earnest money deposit, and the department was entitled to verify the genuineness of the pledged postal time deposit passbook. When the postal authorities informed the department that the passbook should not be acted upon, the committee was entitled to treat the tender as non-responsive without waiting for a further enquiry or issuing a show-cause notice. The challenge could not be decided by substituting later materials for the contemporaneous decision taken on the basis of the information then available.

Conclusion: The rejection of the first stretch tender was not arbitrary or unreasonable.

Issue (iii): Whether rejection of the second stretch tender on the ground of an unduly low and unworkable quoted rate was arbitrary

Analysis: The committee found that the tenderer had quoted an absurdly low rate for a substantial and final item of work, making the tender commercially unworkable and creating a risk to execution of the contract. The committee was entitled to treat such a freak rate as relevant to the reliability of performance. The assessment was a matter of commercial judgment and not open to appellate re-evaluation by the court in judicial review.

Conclusion: The rejection of the second stretch tender was not arbitrary or irrational.

Final Conclusion: The High Court ought not to have interfered with the award of the contracts, and the rejection of the unsuccessful tenderer's bids for both stretches stood justified on the materials then available.

Ratio Decidendi: In tender matters, judicial review is limited to illegality, arbitrariness, irrationality, mala fides, and public interest; where the authority's decision is based on contemporaneous material and is a bona fide commercial assessment, courts will not substitute their own view for that of the tendering authority.

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