Municipal contract discretion prevails: judicial review cannot impose tender terms or select the contractor absent arbitrariness.

In matters of municipal contracts and public largesse, the Court held that Article 226 review is confined to checking arbitrariness and cannot be used to substitute judicial terms for those of the statutory authority. The Corporation retained discretion over how to establish, maintain and regulate the slaughter house, and such contracts should ordinarily be awarded through open tender or auction to ensure transparency and equality. As the impugned advertisement inviting bids disclosed no arbitrariness, discrimination or mala fides, the High Court could not direct grant of a 10-year contract or fix its terms. The writ judgment was set aside and the Corporation was left to proceed afresh in accordance with law.

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Issues: Whether the High Court could, in writ jurisdiction, direct grant of a 10-year contract for running and modernizing a municipal slaughter house on terms fixed by the Court, and whether the impugned advertisement inviting bids was illegal.

Analysis: The Corporation's functions under the municipal statute included establishment, maintenance and regulation of slaughter houses, and the choice of how to operate them and on what terms lay with the statutory authority. The power of judicial review under Article 226 could be used to check arbitrariness, but not to take over policy decisions or substitute the Court's terms for those of the public authority. Contracts and public largesse are ordinarily to be awarded by public auction or public tender to ensure transparency, equality and public confidence, and departure from that rule is justified only in rare and exceptional situations. The impugned advertisement inviting bids did not disclose arbitrariness, discrimination or mala fides, and there was no basis for the High Court to thrust a particular contract on the Corporation or to fix its duration and conditions.

Conclusion: The High Court's directions were unsustainable, and the advertisement could not be invalidated on the grounds urged.

Final Conclusion: The writ judgment was set aside, the appeal was allowed, and the Corporation was left to proceed afresh in accordance with law, including by issuing a fresh advertisement and making interim arrangements for operation of the slaughter house.

Ratio Decidendi: In matters of public contracts and municipal largesse, the Court may review administrative action for arbitrariness but cannot itself choose the contractor or prescribe contractual terms, as such decisions belong to the competent public authority and should ordinarily be taken through an open and transparent tender process.

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