Government tender discretion upheld where highest bid may be rejected without reasons if public interest so requires.

In Government contracts and disposal of liquor privileges, a condition allowing rejection of the highest tender without reasons was treated as valid and not discriminatory merely because it reserved discretion to the State. The State was not obliged to accept the highest offer where another offer was considered more suitable or the public financial interest required otherwise, so the Article 14 challenge failed. The appellant's lease could not be cancelled on the basis of a later statement by the Government alone, because no independent cogent ground for annulment was shown and the appellant was the directly affected party. The acceptance of the revised offer was therefore left undisturbed.

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Issues: Whether a tender condition reserving to the Government the right to reject the highest tender without assigning reasons was invalid under Article 14, and whether the lease granted in favour of the appellant could be set aside on the facts of the case.

Analysis: The decision recognises that in matters of Government contracts and disposal of liquor privileges, the State is not bound to accept the highest tender if it considers another offer more suitable or if the financial interest of the State so requires. A condition permitting rejection of the highest tender without reasons is not, by itself, discriminatory or arbitrary merely because it leaves a discretion with the Government. The Court also held that the lease could not be annulled solely because the Government stated, after the event, that it was prepared to have it set aside if so directed, since the appellant was the party directly affected and no independent cogent ground for cancellation had been shown. The challenge under Article 14 therefore failed, and there was no legal basis for interference with the Government's acceptance of the appellant's revised offer.

Conclusion: The tender condition was valid, the Government's action was not hit by Article 14, and the cancellation of the appellant's lease was unsustainable.

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