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Supreme Court of India

AIRPORT AUTHORITY OF INDIAversusCENTRE FOR AVIATION POLICY, SAFETY & RESEARCH (CAPSR) & OTHERS

Citation
2022 INSC 1047
Decided
30 September 2022
Disposal
Appeal(s) allowed

Holding

The High Court erred; CAPSR lacks locus standi and the tender eligibility criteria are not arbitrary, discriminatory or mala‑fide, so the High Court’s order is set aside.

Summary

The Airport Authority of India (AAI) issued Request for Proposals for ground handling services at various airport groups, setting eligibility criteria that included regional clustering, a 36‑month experience requirement for scheduled flights, and a minimum annual turnover of Rs 30 crore (later reduced to Rs 18 crore). The Centre for Aviation Policy, Safety & Research (CAPSR), a non‑profit NGO, filed a writ petition before the Delhi High Court challenging these criteria as arbitrary, discriminatory and violative of MSME norms. The High Court struck down the criteria and the regional clustering, holding them illegal. AAI appealed, arguing that CAPSR lacked locus standi and that tender terms are a matter of administrative discretion not open to judicial scrutiny unless manifestly arbitrary, discriminatory or mala‑fide. The Supreme Court held that CAPSR, not being an aggrieved party, had no locus standi, and that the eligibility criteria were reasonable and within AAI’s discretion; consequently, the High Court’s order was set aside and the writ petition dismissed. The appeals were allowed.

Issues considered

  • Whether the NGO CAPSR has locus standi to challenge AAI's tender eligibility criteria under Article 226.
  • Whether the eligibility criteria (regional clustering, experience requirement, turnover threshold) are amenable to judicial review or are arbitrary, discriminatory or mala‑fide.
  • Whether the MSME Act and related orders apply to the tender in question.

Legislation cited

Subjects

locus standitender eligibility criteriajudicial reviewpublic procurementMSMEairport authorityground handling servicesArticle 226contractual discretionarbitrarinessdiscrimination

Judgment

                        [2022] 13 S.C.R. 451                              451


                AIRPORT AUTHORITY OF INDIA                                A
                                  v.
  CENTRE FOR AVIATION POLICY, SAFETY & RESEARCH
                (CAPSR) & OTHERS
                (Civil Appeal Nos. 6615-6616 of 2022)                     B
                       SEPTEMBER 30, 2022
         [M. R. SHAH AND KRISHNA MURARI, JJ.]
       Constitution of India – Article 226 – Judicial scrutiny of
eligibility criteria/tender conditions – Scope and ambit of – Held:
                                                                          C
Respondent no.1 claiming to be a non-profit organisation carrying
out research, advisory and advocacy in the field of civil aviation
filed writ petition challenging the tender conditions in the respective
Request for Proposal (RFPs) floated by appellant-AAI – None of
the Ground Handling Agencies (GHAs) who participated in the
tender process and/or could have participated in the tender process       D
challenged the tender conditions – Writ petition before High Court
was not in the nature of Public Interest Litigation – Respondent
no.1 cannot be said to be an‘‘aggrieved party” – High Court ought
to have dismissed the writ petition on the ground of locus standi of
respondent no.1 to maintain the writ petition – Further, terms and
                                                                          E
conditions of the Invitation to Tender are within the domain of the
tenderer/tender making authority and are not open to judicial
scrutiny being in the realm of contract, unless they are arbitrary,
discriminatory or mala fide – On merits, AAI explained before the
High Court, the rationale behind the respective conditions, namely,
clustering of 49 airports into 4 region-wise sub-categories/clusters;     F
criteria for evaluation - 36 months experience in past 7 years in
providing 3 out of 7 Core GHS and the financial capacity- Annual
Turnover of Rs. 30 crores (modified as Rs. 18 crores) in any one of
last three financial years – The respective clauses/conditions cannot
be said to be arbitrary and/or mala fide and/or actuated by bias –
                                                                          G
It was for the AAI to decide its own terms and fix the eligibility
criteria – Impugned order set aside – Writ petition filed by
respondent no.1 dismissed.
      Maa Binda Express Carrier v. North-East Frontier
      Railway (2014) 3 SCC 760 : [2013] 12 SCR 529;
                                                                          H
                                 451
452            SUPREME COURT REPORTS                        [2022] 13 S.C.R.


A           Directorate of Education v. Educomp Datamatics
            Limited (2004) 4 SCC 19 : [2004] 2 SCR 1010; Meerut
            Development Authority v. Assn. of Management Studies
            (2009) 6 SCC 171 : [2009] 6 SCR 663; Michigan
            Rubber (India) Limited v. State of Karnataka (2012) 8
            SCC 216 : [2012] 8 SCR 128 – relied on.
B
            Anand Sharadchandra Oka v. University of Mumbai
            (2008) 5 SCC 217 : [2008] 2 SCR 297 – referred to.
                              Case Law Reference
      [2008] 2 SCR 297                   referred to       Para 3.1
C
      [2013] 12 SCR 529                  relied on         Para 3.6
      [2004] 2 SCR 1010                  relied on         Para 3.6
      [2009] 6 SCR 663                   relied on         Para 3.6
      [2012] 8 SCR 128                   relied on         Para 3.6
D
            CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 6615-
      6616 of 2022.
            From the Judgment and Order dated 14.07.2021 of the High Court
      of Delhi at New Delhi in WP (C) No. 5722 of 2020.
E          K. M. Nataraj, ASG, Vinayak Sharma, Shubham Seth, Mrinal
      Choudhry, Nikilesh Ramachandran, Advs. for the Appellant.
           Umakant Mishra, Sibo Sankar Mishra, Niranjan Sahu, Sachin Patil,
      Siddharth Dharamadhikari, Geo Joseph, Durgesh Gupta, Aaditya
      Aniruddh Pande, Advs. for the Respondents.
F
            The Judgment of the Court was delivered by
            M. R. SHAH, J.
             1. Feeling aggrieved and dissatisfied with the impugned judgment
      and order dated 14.07.2021 passed by the High Court of Delhi at New
G     Delhi in Writ Petition (Civil) No. 5722 of 2020, by which the High Court,
      in exercise of its powers under Article 226 of the Constitution of India,
      has allowed the said writ petition and has struck down the decision to
      carry out region-wise sub-categorisation of the 49 airports falling under
      Group D-1; the stipulation that only previous work experience in respect
      of providing GHS to scheduled aircrafts shall be considered acceptable
H
AIRPORT AUTHORITY OF INDIA v. CENTRE FOR AVIATION                               453
 POLICY, SAFETY & RESEARCH (CAPSR) [M. R. SHAH, J.]

for the purpose of the impugned tender/RFP and the revised minimum              A
Annual Turnover criteria of INR 18 crores as discriminatory and arbitrary,
the Airport Authority of India (for short, ‘AAI’) has preferred Civil Appeal
No. 6615/2022. The subsequent order dated 24.09.2021 rejecting the
review application being Review Petition No. 150/2021 to review and
recall the final judgment and order passed in Writ Petition No. 5722/
                                                                                B
2020 is also the subject matter of Civil Appeal No. 6616/2022.
         2. The facts leading to the present appeals in a nutshell are as
under:
        The appellant herein – AAI floated a Request for Proposal (for
short, ‘RFP’)/tender for concession of ground handling services at Group        C
‘A’, ‘B’ and ‘C’ airports owned by it on 01.05.2018. The appellant herein
– AAI also floated a RFP/tender for concession of ground handling
services at Group ‘D’ airports owned by it on 02.05.2018. That the RFP
for Group ‘D’ airports was modified multiple times and finally republished
as Corrigendum No. 21. However, subsequently, vide letter dated
10.06.2019, AAI cancelled the tender earlier floated for Group ‘D’              D
airports. That thereafter, the AAI published a fresh RFP on 28.07.2020
for Group ‘D1’ airports. The respective RFPs contained the eligibility
criteria which include the technical and financial qualifications.
       2.1 Respondent No.1 herein – Centre for Aviation Policy, Safety
& Research (CAPSR) filed a writ petition before the High Court                  E
challenging the eligibility criteria and the respective RFPs with respect
to Group ‘C’, ‘D1’ and ‘D2’ airports on the ground that the eligibility
criteria contained in the RFPs are not only a radical departure from the
past, but also stipulate onerous technical and financial qualifications,
thereby rendering most of the extant Ground Handling Agencies (for              F
short, ‘GHAs’) ineligible to participate in the tender process, especially
those which have been providing Ground Handling Services (for short,
‘GHS’) at the smaller airports of the country, that fall under the categories
of Groups ‘C’, ‘D1’ and ‘D2’ airports, for the last many years. It was
also the case on behalf of the original writ petitioner that the prescribed
technical and financial qualifications have no corelation with the GHS          G
that the service providers are expected to provide at the Groups ‘C’,
‘D1’ and ‘D2’ airports and that the same have been arbitrarily and
whimsically tailored with a view to oust the existing GHS providers, who
have been providing these services for years, without any complaint.
                                                                                H
454             SUPREME COURT REPORTS                         [2022] 13 S.C.R.


A            2.2 The writ petition was opposed by the AAI by filing a counter
      affidavit. It was the case on behalf of the AAI that the objective of the
      tenders for Group ‘C’, ‘D1’ and ‘D2’ airports was not to oust small
      players but sought to exclude GHAs, which lack expertise and
      infrastructure and used casual and unskilled labour in workforce which
      allowed them to offer better rates as compared to other GHAs. It was
B
      also the case on behalf of the AAI that considering the importance of
      experience in GHS for scheduled aircrafts given the nature of work
      involved in scheduled flights are wider than non-scheduled flights. Thus,
      36 months of experience in past 7 years of handling ground handling
      services for scheduled flights was reasonable. It was also submitted on
C     behalf of the AAI that the earnest money deposit, Annual Turnover
      criterion and qualifying experience criterion is not arbitrary, irrational
      and discriminatory. It was also pointed out that the amount of earnest
      money deposit required in the tender for Group ‘D1’ airports has been
      reduced from Rs. 35 Lakhs per region to Rs. 15 Lakhs per region. AAI
      also tried to justify the Annual Turnover criterion of Rs. 30 crores for
D
      Group ‘D1’ airports. At this stage, it is required to be noted that pursuant
      to the directions of the High Court, the AAI agreed to reduce the
      requirement of Annual Turnover criterion to Rs. 18 crores for Group
      ‘D1’ airports. The AAI also challenged the locus of respondent No. 1 –
      original writ petitioner.
E            2.3 By the impugned judgment and order, the High Court has set
      aside the respective RFPs and has set aside the decision to carry out
      region-wise sub-categorisation of the 49 airports falling under Group D-
      1. The High Court has also set aside the stipulation in the RFPs that only
      previous work experience in respect of providing GHS to scheduled
F     aircrafts shall be considered acceptable for the purpose of the impugned
      tender/RFP and the revised minimum Annual Turnover criteria of INR
      18 crores observing the same as discriminatory and arbitrary.
            2.4 Feeling aggrieved and dissatisfied with the impugned judgment
      and order passed by the High Court, as also the order passed in the
G     review application, the original respondent – AAI has preferred the present
      appeals.
             3. Shri K.M. Nataraj, learned Additional Solicitor General of India
      appearing for AAI has assailed the impugned judgment and order passed
      by the High Court, inter alia, on the following grounds:
H
AIRPORT AUTHORITY OF INDIA v. CENTRE FOR AVIATION                               455
 POLICY, SAFETY & RESEARCH (CAPSR) [M. R. SHAH, J.]

       i) that the original writ petitioner before the High Court has no        A
          locus standi to maintain the writ petition;
       ii) that the terms and conditions invitation to tender, being in the
           realm of contract, are not open to judicial scrutiny; and
       iii) MSME order of 2012 and MSME order of 2018 are not
            applicable in the facts of the present case                         B

        3.1 Elaborating the aforesaid grounds, it is vehemently submitted
by Shri K.M. Nataraj, learned ASG that the original writ petitioner claims
to be a non-profit organisation carrying out independent research, advisory
and advocacy in the field of civil aviation. It is submitted that as per the
settled position, NGOs have no locus standi to maintain a writ petition         C
challenging the tender conditions especially when the same is not in the
nature of a Public Interest Litigation. It is submitted that an NGO has no
business to enter into tender disputes as the same falls in the realm of
contract. It is submitted that the original writ petitioner cannot be said to
be an affected and/or aggrieved party and therefore at the instance of          D
the original writ petitioner, a writ petition was not maintainable assailing
the tender process. Reliance is placed upon the decision of this Court in
the case of Anand Sharadchandra Oka v. University of Mumbai,
(2008) 5 SCC 217 (para 12).
       3.2 It is submitted by the learned ASG that the original writ            E
petitioner mainly challenged three terms/conditions of the tender in
question, namely,
       I.   Clustering of 49 Airports into 4 Region-wise sub-categories/
            Clusters;
       II. Criteria for Evaluation – Clause 3.2.1 – 36 Months Experience        F
           in past 7 years in providing 3 out of 7 Core GHS; and
       III. Financial capacity – Clause 3.2.2 – Annual turnover of 30 Cr.
             In any one of last 3 Financial Years
       It is submitted that all the aforesaid criterions have sound rationale
and therefore the same could not have been the subject matter of a writ         G
petition before the High Court under Article 226 of the Constitution of
India. It is submitted that so far as the clustering of 49 airports into 4
Region-wise sub-categories/clusters is concerned, the clustering was
done with the aim of promoting regional connectivity and avoiding the
                                                                                H
456             SUPREME COURT REPORTS                           [2022] 13 S.C.R.


A     cumbersome administrative task of inviting and dealing with separate
      tenders for each of the 49 airports under Group ‘D1’ category.
             3.3 It is submitted that so far as the criteria for evaluation - 36
      months experience in past 7 years in providing 3 out of 7 Core GHS is
      concerned, the purpose of stipulating past experience of handling
B     scheduled airlines was that such airlines operate larger aircrafts and the
      number of flights, passengers and amount of cargo would increase in
      future with the opening up of the aviation sector.
              3.4 Now so far as providing and/or insistence of the financial
      capacity – Annual Turnover of Rs. 30 crores in any one of last three
C     financial years is concerned, it is submitted that as such the same was
      scaled down to Rs. 18 crores. It is submitted that even otherwise the
      said criterion was set in view of the nature of the tender and the
      consequential financial strength which would be required in order to
      fulfil the obligations.

D             3.5 It is submitted that the aforesaid conditions have been
      incorporated keeping in mind the commercial considerations and
      commercial expediency and the tender making authority is well within
      its rights to formulate conditions based on its commercial wisdom.
             3.6 It is submitted that as per the settled position of law, setting of
E     terms and conditions of invitation to tender are within the ambit of the
      administration/policy decision of the tender making authority and as such
      are not open to judicial scrutiny unless they are arbitrary, discriminatory
      or mala fides. Reliance is placed on the decisions of this Court in the
      case of Maa Binda Express Carrier v. North-East Frontier Railway,
      (2014) 3 SCC 760 (para 8); Directorate of Education v. Educomp
F     Datamatics Limited, (2004) 4 SCC 19 (para 12); Meerut
      Development Authority v. Assn. of Management Studies, (2009) 6
      SCC 171 (paras 26 & 27); and Michigan Rubber (India) Limited v.
      State of Karnataka, (2012) 8 SCC 216 (paras 23 & 35).
             3.7 Making the above submissions and relying upon the aforesaid
G     decisions, it is vehemently submitted that in the present case, the High
      Court has erred in interfering with the administration/policy decision of
      the tender making authority in exercise of powers under Article 226 of
      the Constitution of India.
            3.8 Now so far as the reliance placed upon MSME orders of
H     2012 and 2018 by the High Court is concerned, it is submitted that the
AIRPORT AUTHORITY OF INDIA v. CENTRE FOR AVIATION                              457
 POLICY, SAFETY & RESEARCH (CAPSR) [M. R. SHAH, J.]

reliance placed by respondent No.1 on the aforesaid orders is misplaced        A
as the tenders in question have been issued with the purpose of selecting
GHS for providing GHS, which service is in fact akin to grant of a license
to the GHA, as opposed to procurement of any goods and services that
form the crux of the MSME orders.
       3.9 It is submitted that even otherwise it is evident from sub-         B
clause (1) of clause 3 of the MSME order of 2012, the minimum threshold
prescribed is the annual goal for overall procurement and cannot be
made applicable to each tender individually. It is further submitted that a
reading of sub-clause (4) of clause 3 of MSME order of 2012 would
show that the mandate of the order is not absolute. It provides that in the
even of any Ministry, Department or PSU failing to meet the objective,         C
they shall substantiate the same with reasons, which means that the
departure from the requirement under the order has been envisaged as
long as the same is substantiated with reasons.
       3.10 Making the above submissions and relying upon the aforesaid
decisions, it is prayed to allow the present appeals and quash and set         D
aside the impugned judgment and order passed by the High Court.
       4. The present appeal is vehemently opposed by Shri Umakant
Mishra, learned counsel appearing on behalf of respondent No.1 – original
writ petitioner.
                                                                               E
       4.1 It is vehemently submitted by the learned counsel appearing
on behalf of respondent No.1 that all the members of respondent No.1
are GHAs and were to participate in the tender. It is submitted that after
the authorities did not respond to the representations of the individual
GHA members of respondent No.1, only thereafter a writ petition was
preferred before the High Court challenging the illegal policy changes         F
made in the tender. It is submitted that therefore it cannot be said that
respondent No.1 – original writ petitioner had no locus standi to file the
writ petition challenging the most arbitrary and illegal tender conditions.
      4.2 It is then submitted that since the tender conditions No. 2.2.1(a)
allowed three entities to form a consortium to bid, the respondent could       G
have been a potential bidder as part of a consortium with two of its
member GHAs who as MSME could have a maximum turnover of Rs.
5 crore each. It is submitted that however since the turnover criteria to
be eligible to bid was arbitrarily fixed as Rs. 30 crores, even as a
consortium with two of its member GHAs, the said eligibility has impaired
                                                                               H
458             SUPREME COURT REPORTS                           [2022] 13 S.C.R.


A     the fundamental rights of the respondent and its members who are
      MSMEs. It is submitted that there also respondent No.1 has locus to
      file the writ petition.
             4.3 It is then submitted that in the present case the AAI earlier
      had disregarded the provisions of Section 12(5) of the AAI Act, 1994
B     r/w the provisions of the MSME Act and MSME Order of 2012 and the
      statutory Public Procurement Policy of the Government wherein it is
      mandated that the AAI must procure 25% of services from MSME
      sector along with giving other benefits such as free of cost tender and
      exemptions to be granted from payment of Earnest Money Deposit
      (EMD) to register small and medium enterprises. It is submitted that in
C     the present case the AAI artificially introduced differentiation in technical
      eligibility criteria, specifying experience in providing GHS to scheduled
      airlines flights only even there is no differentiation between GHS provided
      to non-scheduled or scheduled airlines in the AAI (GHS) Regulations,
      2018.
D             4.4 It is further submitted that as rightly observed and held by the
      High Court the terms and conditions set forth in the tenders are
      discriminatory, restrictive, and exclusionary. It is submitted that clustering
      of small airports of different sizes, different capacity to handle aircrafts,
      different financial viabilities, different locations into regions etc. is not
E     based on intelligible differentia nor does it have any rational nexus to
      the avowed objective of the respondent of security. It is submitted that
      as the relevant eligibility criteria and the conditions mentioned in the
      respective tenders were found to be discriminatory and arbitrary and no
      nexus with the object of providing such eligibility criteria, the High Court
      has not committed any error in striking down the decision to carry out
F     region-wise sub-categorisation of the 49 airports falling under Group D-
      1; the stipulation that only previous work experience in respect of providing
      GHS to scheduled aircrafts shall be considered acceptable for the purpose
      of the impugned tender/RFP and the revised minimum Annual Turnover
      criteria of INR 18 crores as discriminatory and arbitrary.
G           4.5 Making the above submissions, it is prayed to dismiss the
      present appeals.
             5. We have heard learned counsel for the respective parties at
      length.

H
AIRPORT AUTHORITY OF INDIA v. CENTRE FOR AVIATION                             459
 POLICY, SAFETY & RESEARCH (CAPSR) [M. R. SHAH, J.]

       At the outset, it is required to be noted that respondent No.1         A
claiming to be a non-profit organisation carrying out research, advisory
and advocacy in the field of civil aviation had filed a writ petition
challenging the tender conditions in the respective RFPs. It is required
to be noted that none of the GHAs who participated in the tender process
and/or could have participated in the tender process have challenged the
                                                                              B
tender conditions. It is required to be noted that the writ petition before
the High Court was not in the nature of Public Interest Litigation. In that
view of the matter, it is not appreciable how respondent No.1 – original
writ petitioner being an NGO would have any locus standi to maintain
the writ petition challenging the tender conditions in the respective RFPs.
Respondent No.1 cannot be said to be an” aggrieved party”. Therefore,         C
in the present case, the High Court has erred in entertaining the writ
petition at the instance of respondent No.1, challenging the eligibility
criteria/tender conditions mentioned in the respective RFPs. The High
Court ought to have dismissed the writ petition on the ground of locus
standi of respondent No.1 – original writ petitioner to maintain the writ
                                                                              D
petition.
       6. Even otherwise, even on merits also, the High Court has erred
in quashing and setting aside the eligibility criteria/tender conditions
mentioned in the respective RFPs, while exercising the powers under
Article 226 of the Constitution of India. As per the settled position of
law, the terms and conditions of the Invitation to Tender are within the      E
domain of the tenderer/tender making authority and are not open to judicial
scrutiny, unless they are arbitrary, discriminatory or mala fide. As
per the settled position of law, the terms of the Invitation to Tender are
not open to judicial scrutiny, the same being in the realm of contract. The
Government/tenderer/tender making authority must have a free hand in          F
setting the terms of the tender.
       7. While considering the scope and ambit of the High Court under
Article 226 of the Constitution of India with respect to judicial scrutiny
of the eligibility criteria/tender conditions, few decisions of this Court
are required to be referred to, which are as under:                           G
        In the case of Maa Binda Express Carrier (supra), in paragraph
8, this Court observed and held as under:
      “8. The scope of judicial review in matters relating to award of
      contracts by the State and its instrumentalities is settled by a long
                                                                              H
460            SUPREME COURT REPORTS                            [2022] 13 S.C.R.


A           line of decisions of this Court. While these decisions clearly
            recognise that power exercised by the Government and its
            instrumentalities in regard to allotment of contract is subject to
            judicial review at the instance of an aggrieved party, submission
            of a tender in response to a notice inviting such tenders is no more
            than making an offer which the State or its agencies are under no
B
            obligation to accept. The bidders participating in the tender process
            cannot, therefore, insist that their tenders should be accepted simply
            because a given tender is the highest or lowest depending upon
            whether the contract is for sale of public property or for execution
            of works on behalf of the Government. All that participating bidders
C           are entitled to is a fair, equal and non-discriminatory treatment in
            the matter of evaluation of their tenders. It is also fairly well settled
            that award of a contract is essentially a commercial transaction
            which must be determined on the basis of consideration that are
            relevant to such commercial decision. This implies that terms
            subject to which tenders are invited are not open to the judicial
D
            scrutiny unless it is found that the same have been tailor-made to
            benefit any particular tenderer or class of tenderers. So also, the
            authority inviting tenders can enter into negotiations or grant
            relaxation for bona fide and cogent reasons provided such
            relaxation is permissible under the terms governing the tender
E           process.”
            In the case of Michigan Rubber (India) Ltd. (supra), after
      considering the law on the judicial scrutiny with respect to tender
      conditions, ultimately it is concluded in paragraph 23 as under:
            “23. From the above decisions, the following principles emerge:
F
            (a) The basic requirement of Article 14 is fairness in action by the
            State, and non-arbitrariness in essence and substance is the
            heartbeat of fair play. These actions are amenable to the judicial
            review only to the extent that the State must act validly for a
            discernible reason and not whimsically for any ulterior purpose. If
G           the State acts within the bounds of reasonableness, it would be
            legitimate to take into consideration the national priorities;
            (b) Fixation of a value of the tender is entirely within the purview
            of the executive and the courts hardly have any role to play in this
            process except for striking down such action of the executive as
H
AIRPORT AUTHORITY OF INDIA v. CENTRE FOR AVIATION                               461
 POLICY, SAFETY & RESEARCH (CAPSR) [M. R. SHAH, J.]

      is proved to be arbitrary or unreasonable. If the Government acts         A
      in conformity with certain healthy standards and norms such as
      awarding of contracts by inviting tenders, in those circumstances,
      the interference by courts is very limited;
      (c) In the matter of formulating conditions of a tender document
      and awarding a contract, greater latitude is required to be conceded      B
      to the State authorities unless the action of the tendering authority
      is found to be malicious and a misuse of its statutory powers,
      interference by courts is not warranted;
      (d) Certain preconditions or qualifications for tenders have to be
      laid down to ensure that the contractor has the capacity and the          C
      resources to successfully execute the work; and
      (e) If the State or its instrumentalities act reasonably, fairly and in
      public interest in awarding contract, here again, interference by
      court is very restrictive since no person can claim a fundamental
      right to carry on business with the Government.”                          D
       In the aforesaid decision, it is further observed that the Government
and their undertakings must have a free hand in setting terms of the
tender and only if it is arbitrary, discriminatory, mala fide or actuated by
bias, the courts would interfere. It is further observed that the courts
cannot interfere with the terms of the tender prescribed by the                 E
Government because it feels that some other terms in the tender would
have been fair, wiser or logical.
     Similar views have been expressed in the case of Educomp
Datamatics Ltd. (supra) and Meerut Development Authority (supra).
       8. In the present case, the AAI explained before the High Court          F
the rationale behind the respective conditions, namely, clustering of 49
airports into 4 region-wise sub-categories/clusters; criteria for evaluation
- 36 months experience in past 7 years in providing 3 out of 7 Core GHS
and the financial capacity – Annual Turnover of Rs. 30 crores (modified
as Rs. 18 crores) in any one of last three financial years.
                                                                                G
        9. Having gone through the respective clauses/conditions which
are held to be arbitrary and illegal by the High Court, we are of the
opinion that the same cannot be said to be arbitrary and/or mala fide
and/or actuated by bias. It was for the AAI to decide its own terms and
fix the eligibility criteria.
                                                                                H
462             SUPREME COURT REPORTS                            [2022] 13 S.C.R.


A             10. Applying the law laid down by this Court in the aforesaid
      decisions, we are of the opinion that the High Court has committed a
      serious error in first of all entertaining the writ petition at the instance of
      respondent No.1 – original writ petitioner, an NGO and also holding the
      relevant eligibility criteria/conditions mentioned in the tender documents
      as illegal.
B
             11. Now so far as the submission on behalf of the original writ
      petitioner on MSME orders of 2012 and 2018 is concerned, the same
      can always be subject to the fulfilment of other conditions of the tender
      documents. Even otherwise, selecting GHS for providing GHS cannot
      be equated with the procurement of any goods and services that form
C     the crux of the MSME orders. In any case, as observed hereinabove, at
      the instance of respondent No.1, the High Court ought not to have
      entertained the writ petition challenging the terms and conditions of the
      tender documents and as observed hereinabove, none of the tender
      conditions/eligibility criteria can be said to be arbitrary and/or mala fide
D     and/or actuated by bias.
             12. In view of the above and for the reasons stated above, the
      impugned judgment and order(s) passed by the High Court are
      unsustainable and the same deserve to be quashed and set aside and are
      accordingly hereby quashed and set aside. Consequently, the writ petition
E     filed before the High Court at the instance of respondent No.1 – original
      writ petitioner stands dismissed.
             13. The instant appeals are accordingly allowed. However, in the
      facts and circumstances of the case, there shall be no order as to costs.

F     Divya Pandey                                                    Appeals allowed.




G




H


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