Tender review is limited to arbitrariness and mala fides; courts should not rewrite technical specifications or eligibility criteria.
Tender review is confined to arbitrariness, irrationality, mala fides, bias, or unreasonableness in the decision-making process, and courts should not substitute their own technical or commercial view for that of the tendering authority. Allegations that specifications or eligibility conditions were tailor-made to favour particular bidders did not, by themselves, justify interference where the State acted fairly and in public interest. A bidder's non-controlling investment in another bidder did not establish a disqualifying conflict, and MSME or domestic enterprise preferences could not override the tender's eligibility . The tender challenge therefore failed on the grounds urged.
Issues: (i) Whether the High Court could interfere with the tender process on the ground that the specifications and eligibility conditions were not generic and were tailor-made to favour particular bidders; (ii) Whether the alleged financial linkage between bidders and the claims based on domestic enterprise status justified judicial interference with the tender award.
Issue (i): Whether the High Court could interfere with the tender process on the ground that the specifications and eligibility conditions were not generic and were tailor-made to favour particular bidders.
Analysis: Judicial review in tender matters is confined to examining arbitrariness, irrationality, mala fides, bias, or unreasonableness in the decision-making process. The Court reiterated that it does not sit as an appellate authority over commercial or technical choices made by the tendering authority, and that the author of the tender document is ordinarily best placed to understand its requirements. Where the State acts fairly, reasonably, and in public interest, courts must exercise restraint and avoid substituting their own view for that of the expert bodies responsible for framing tender conditions.
Conclusion: The interference with the tender on the ground of alleged tailor-made specifications was not warranted.
Issue (ii): Whether the alleged financial linkage between bidders and the claims based on domestic enterprise status justified judicial interference with the tender award.
Analysis: The Court held that the investment by one bidder in another through non-controlling preference shares did not establish a disqualifying conflict or justify lifting the corporate veil in a tender dispute. The claims based on MSME or domestic enterprise preference also did not advance the challenge because participation had to first satisfy the tender conditions, and the benefit provisions could not be invoked to override eligibility requirements. The corrigendum and the tender process as actually conducted showed that the grievance about exclusionary conditions had been substantially addressed.
Conclusion: The alleged linkage and domestic enterprise arguments did not furnish a basis to invalidate the tender process.
Final Conclusion: The impugned judgment of the High Court was unsustainable, and the appeals succeeded with costs.
Ratio Decidendi: In tender matters, judicial review is limited to illegality, arbitrariness, mala fides, or irrationality in the decision-making process, and courts should not interfere merely because they would have preferred different technical or commercial specifications.
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