M/S. GALAXY TRANSPORT AGENCIES, CONTRACTORS, TRADERS, TRANSPORTS AND SUPPLIERSversusM/S. NEW J.K. ROADWAYS, FLEET OWNERS AND TRANSPORT CONTRACTORS & ORS.

1090                     [2020] REPORTS
                SUPREME COURT   12 S.C.R. 1090              [2020] 12 S.C.R.


 A       M/S. GALAXY TRANSPORT AGENCIES, CONTRACTORS,
               TRADERS, TRANSPORTS AND SUPPLIERS
                                         v.
             M/S. NEW J.K. ROADWAYS, FLEET OWNERS AND
                   TRANSPORT CONTRACTORS & ORS.
 B
                          (Civil Appeal No. 4107 of 2020)
                              DECEMBER 18, 2020
            [ROHINTON FALI NARIMAN, NAVIN SINHA AND
                        K. M. JOSEPH, JJ.]
 C
               Tenders – Inspector General of Police, Kashmir Zone invited
       online tenders from reputed transporters, registered firms/
       associations for the supply of various types of commercial vehicles
       (without fuel) for the carriage of troops and equipment for the
       Financial Year 2020-2021 – Four parties submitted their bids –
 D     The Tender Opening Committee found that respondent no. 1 did not
       meet the qualifying requirements of the technical bid – The appellant
       fulfilling the requirements and being the lowest bidder, was allotted
       the contract for the supply of commercial vehicles – Writ petition by
       respondent no. 1 – The Single Judge of the High Court found that
       the appellant fulfilled the eligibility condition of holding a valid
 E
       service licence; 31 vehicles were owned by the appellant, another
       eligibility condition was satisfied – Insofar, eligibility criteria of
       having work experience was concerned, the Single Judge of the
       High Court held that since the tendering authority was the best
       judge as to whether such eligibility condition had in fact been
 F     satisfied, a judicial hands-off was mandated – Thus, all the three
       contentions of respondent no. 1 raised against the appellant were
       rejected by the Single Judge of the High Court – However, the
       Division Bench of the High Court held that the respondent no. 1
       having satisfied condition no. 31 of N.I.T was wrongly disqualified
       by the tendering authority – The Division Bench of the High Court
 G
       held that the expression ‘HMV/ LMV’ meant that there was an option
       of furnishing the particulars of either HMVs or LMVs or both types
       of vehicles and the respondent no. 1 had submitted bid accordingly
       – The action of the officials in rejecting the bid of respondent no. 1
       on the ground of non-furnishing of list of both types of vehicles is
 H     irrational, arbitrary and perverse – On appeal, held: A cursory
                                        1090
   M/S. GALAXY TRANSPORT AGENCIES, CONTRACTORS, TRADERS,                1091
   TRANSPORTS AND SUPPLIERS v. M/S. NEW J.K. ROADWAYS, FLEET
            OWNERS AND TRANSPORT CONTRACTORS

glance at Condition No. 31 of N.I.T would show that the 30 vehicles     A
referred to, are ‘both HMV/LMV’ – The tendering authority has
construed this condition to mean that both types of vehicles, i.e.
HMV and LMV, need to be included in the list of 30 vehicles
submitted by each bidder – In a series of judgments, the Supreme
Court has held that authority that authors the tender document is
                                                                        B
the best person to understand and appreciate its requirements, and
thus, its interpretation should not be second-guessed by a Court in
judicial review proceedings – In accordance with the settled law
and noting the interpretation of the tendering authority, it cannot
be said that the interpretation done by the authority was a perverse
one – The Division Bench of the High Court ought not to have            C
interfered with it by giving its own interpretation and not giving
proper credence to the word ‘both’ appearing in Condition No. 31
of the N.I.T – Therefore, the Division Bench decision is set aside
and the Single Judge’s judgment is restored.
      Disposing of the appeal, the Court                                D
      HELD:1. A cursory glance at Condition No. 31 of the N.I.T.
would show that the 30 vehicles referred to, are “both HMV/
LMV”. The tendering authority has construed this condition to
mean that both types of vehicles, i.e., HMV and LMV, need to be
included in the list of the 30 vehicles submitted by each bidder.       E
[Para 13][1098-E-F]
      2. In a series of judgments, this Court has held that the
authority that authors the tender document is the best person to
understand and appreciate its requirements, and thus, its
interpretation should not be second-guessed by a court in judicial      F
review proceedings. [Para 14][10968-F-G]
      3. In accordance with these Supreme Court judgments and
noting that the interpretation of the tendering authority in this
case cannot be said to be a perverse one, the Division Bench
ought not to have interfered with it by giving its own interpretation   G
and not giving proper credence to the word “both’” appearing in
Condition No. 31 of the N.I.T. For this reason, the Division
Bench’s conclusion that respondent no.1 was wrongly declared
to be ineligible, is set aside. [Para 17][1100-D-F]

                                                                        H
1092            SUPREME COURT REPORTS                        [2020] 12 S.C.R.


 A            4. Insofar as Condition No. 27 of the N.I.T. prescribing work
       experience of at least 5 years of not less than the value of Rs. 2
       crores is concerned, suffice it to say that the expert body, being
       the Tender Opening Committee, consisting of four members,
       clearly found that this eligibility condition had been satisfied by
       the Appellant. Without therefore going into the assessment of
 B
       the documents that have been supplied to this Court, it is well
       settled that unless arbitrariness or mala fide on the part of the
       tendering authority is alleged, the expert evaluation of a particular
       tender, particularly when it comes to technical evaluation, is not
       to be second-guessed by a writ court. [Para 18][1100-F-G]
 C            5. This being the case, this Court is unable to fathom how
       the Division Bench, on its own appraisal, arrived at the conclusion
       that the Appellant held work experience of only 1 year, substituting
       the appraisal of the expert four-member Tender Opening
       Committee with its own. [Para 20][1103-B-C]
 D           Afcons Infrastructure Ltd. v. Nagpur Metro Rail
             Corporation Ltd., (2016) 16 SCC 818 : [2016] 3 SCR
             551; Bharat Coking Coal Ltd. v. AMR Dev Prabha
             (2020) SCC OnLine SC 335; Silppi Constructions
             Contractors v. Union of India, (2019) SCC OnLine SC
 E           1133; Jagdish Mandal v. State of Orissa (2007) 14 SCC
             517; Montecarlo Ltd. v. NTPC Ltd., (2016) 15 SCC 272 :
             [2016] 8 SCR 224 – relied on.
                               Case Law Reference
       [2016] 3 SCR 551                   relied on               Para 14
 F
       (2007) 14 SCC 517                  relied on               Para 18
       [2016] 8 SCR 224                   relied on               Para 19
             CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4107
       of 2020.
 G           From the Judgment and Order dated 16.10.2020 of the High Court
       of Jammu and Kashmir at Srinagar in LPA No. 78 of 2020.
             Rana Mukherjee, Altaf H. Naik, Sr. Advs., Adeel Ahmed,
       Ms. Kanika Sharma, Atif Suhrawardy, Syed Mehdi Imam, Yagyawalkya
       Singh, Ms. Shashi Juneja, Satish Pandey, Advs. for the appearing parties.
 H
   M/S. GALAXY TRANSPORT AGENCIES, CONTRACTORS, TRADERS,                        1093
   TRANSPORTS AND SUPPLIERS v. M/S. NEW J.K. ROADWAYS, FLEET
            OWNERS AND TRANSPORT CONTRACTORS

      The Judgment of the Court was delivered by                                A
      R. F. NARIMAN, J.
      1. Leave granted.
       2. In this appeal, the Inspector General of Police, Kashmir Zone,
Zonal Police HQR’s Kashmir, Srinagar [“ZPHS”], being Respondent                 B
No. 4 before us, invited online tenders (e-tenders) vide e-N.I.T. No. 01
of 2020 dated 18.02.2020 [“N.I.T.”] from reputed transporters,
registered firms/associations for the supply of various types of commercial
vehicles (without fuel) for the carriage of troops and equipment for the
Financial Year 2020-2021. Pursuant to the N.I.T., 4 parties, namely,
M/s Associated Contractors; M/s Quareshi Transport Co.; M/s Galaxy              C
Transport Agencies, Contractors, Traders, Transports and Suppliers
[“Appellant”]; and M/s New J.K. Roadways, Fleet Owners and
Transport Contractors [“JK Roadways”] submitted their bids for
consideration and the same were uploaded through an e-tendering system.
The tender process consisted of a technical bid and a financial bid. The        D
Tender Opening Committee met on 11.03.2020 and found that JK
Roadways, Respondent No. 1 herein, and Associated Contractors did
not meet the qualifying requirements of the technical bid, leaving Quareshi
Transport Co. and the Appellant, who were considered technically eligible
for the allotment of the contract. The Appellant’s financial bid being the
lowest, vide an order dated 30.03.2020, the Appellant was allotted the          E
contract for the supply of commercial vehicles for the Financial Year
2020-2021.
       3. A writ petition was filed by JK Roadways seeking the quashing
of the allotment of the contract in favour of the Appellant. Before the
learned Single Judge of the High Court of Jammu and Kashmir at                  F
Srinagar [“Single Judge”], three contentions qua the Appellant’s
technical eligibility were made by JK Roadways, which were decided in
the following manner, by a judgment dated 30.06.2020:
      3a. Firstly, the learned Single Judge found that though the service
          licence of the Appellant was only valid upto 31.03.2020, it           G
          had sought an extension of its service licence prior to its expiry.
          Since a lockdown was imposed on account of the outbreak of
          COVID-19, a General Order dated 30.03.2020 [“General
          Order”] was issued, through which the validity of all
          documents relating to transportation services were deemed
                                                                                H
1094      SUPREME COURT REPORTS                             [2020] 12 S.C.R.


 A         to be extended till 30.06.2020. This being the case, this
           contention was decided against JK Roadways, and it was
           held that the Appellant fulfilled the eligibility condition of holding
           a valid service licence.
       3b. Secondly, it was found that the Appellant did in fact own 30
 B         vehicles including heavy motor vehicles [“HMV”] and light
           motor vehicles [“LMV”], as a list of 36 vehicles was furnished
           to ZPHS, the tendering authority. Since a complaint in this
           regard had been made by the unsuccessful bidders, the same
           was forwarded to the Senior Superintendent of Police, Srinagar
           [“SSP”] to ascertain the veracity of the documents furnished.
 C         The SSP submitted a report finding that though 5 vehicles
           were found to be owned by individuals other than the Appellant,
           31 vehicles were still owned by the Appellant, as a result of
           which the eligibility condition was satisfied. It was also found
           that insofar as 1 vehicle was concerned, it was indeed owned
 D         by the Appellant as there existed a typographical error in the
           registration number of the vehicle.
       3c. Thirdly, as far as the eligibility criteria of having work
           experience of at least 5 years, not being less than Rs. 2 crores
           was concerned, the learned Single Judge found that work
 E         experience certificates from 2014 to 2018 were submitted
           and since the tendering authority was the best judge as to
           whether such eligibility condition had in fact been satisfied, a
           judicial hands-off was mandated.
       3d. Finally, the learned Single Judge concluded:
 F        “16. Considering the submissions of the parties and in view of
          the law laid down by the Supreme Court and also the fact that
          the contract is for the year 2020-21, which has already
          commenced w.e.f. 1st April, 2020, public interest would be
          severely jeopardized if the respondents are not allowed to
 G        execute the contract because the bid of respondent No. 5 was
          the lowest. It is, therefore, in public interest not to interfere in
          the allotment of contract in favour of respondent No. 5, who
          satisfied the criteria as laid down in technical bid as he had
          furnished list of HMV & LMV vehicles which was the most
          essential condition of the tender. Thus, the petitioner having
 H
   M/S. GALAXY TRANSPORT AGENCIES, CONTRACTORS, TRADERS,                      1095
   TRANSPORTS AND SUPPLIERS v. M/S. NEW J.K. ROADWAYS, FLEET
    OWNERS AND TRANSPORT CONTRACTORS [R. F. NARIMAN, J.]

         been found ineligible cannot now question allotment of contract      A
         to respondent No. 5 because the petitioner is not similarly
         situated.”
     4. JK Roadways filed a letters patent appeal before the Division
Bench of the High Court of Jammu and Kashmir at Srinagar [“Division
Bench”]. By the impugned judgment dated 16.10.2020, the Division              B
Bench recorded:
      “14) Though the appellant has raised a number of grounds in the
      appeal yet during the course of arguments, the main thrust of
      arguments advanced by the learned counsel for the appellant was
      on the following grounds:                                               C
         (I) That the official respondents were not justified in rejecting
         bid of the appellant on the ground that it had submitted only the
         list of heavy motor vehicles and that the list did not contain the
         particulars of light motor vehicles;
         (II) That the respondent No.5 despite lacking the requisite          D
         experience in supply of vehicles, was awarded the contract,
         which action has amounted to award of contract in favour of
         an ineligible bidder to the exclusion of an eligible bidder.”
     5. After setting out Condition No. 31 of the N.I.T., the Division
Bench concluded:                                                              E
      “16) From a perusal of the aforesaid condition, it is clear that the
      official respondents while formulating the tender notice have used
      the expression “HMV/LMV” meaning thereby that a tenderer
      had the option of furnishing the particulars of either HMVs or
      LMVs or both types of vehicles. No other construction can be            F
      given to the expression “HMV/LMV”. If the official respondents
      desired that a tenderer must own both types of vehicles i.e. HMVs
      as well as LMVs, they could have easily used the word “and”
      instead of “/” in between HMV and LMV in the tender notice,
      use whereof refers to “or”. This is not the case over here. Thus,
                                                                              G
      if the appellant has furnished the list of Heavy Motor Vehicles
      only, he has done what a reasonable and prudent person would do
      upon going through the tender condition quoted hereinabove. The
      action of the official respondents of rejection of technical bid of
      the appellant on the ground of non-furnishing of list of both types
                                                                              H
1096            SUPREME COURT REPORTS                         [2020] 12 S.C.R.


 A           of vehicle is, therefore, irrational, arbitrary and perverse.
             Therefore, the contention of the appellant in this regard is full of
             substance and deserves to be accepted.
             17) Mr. B. A. Dar, Sr. AAG, has submitted that the tender notice
             condition stated “both HMV/LMV” which meant that the
 B           tenderers had to provide details of both HMV and LMV vehicles.
             Per contra learned Sr. counsel for the appellant has contended
             that the very appellant was found eligible in respect of the same
             condition and was awarded the same work for the previous five
             years which was satisfactorily completed.
 C           18) We are unable to agree with the submission of Sr. AAG. As
             already noted, if the respondents required provision of details of
             both HMV and LMV vehicles, they would have placed “and”
             between them. This has not been done.”
              6. As a result, the Division Bench found that JK Roadways, having
 D     satisfied Condition No. 31 of the N.I.T., was wrongly disqualified by the
       tendering authority. So far as the requirement under Condition No. 27 of
       the N.I.T. of holding work experience of at least 5 years was concerned,
       the Division Bench found that the Appellant had experience of supplying
       vehicles only for a few months in the years 2014 and 2015 and therefore,
       the Appellant could, at best, be said to hold work experience of supplying
 E     vehicles for 1 year only. Thus, Condition No. 27 of the N.I.T., being an
       essential condition, remained unfulfilled by the Appellant. Resultantly,
       the judgment of the Single Judge dated 30.06.2020 was set aside and the
       contract awarded in favour of the Appellant was quashed. The official
       respondents were directed to invite fresh tenders and complete the
 F     process within a period of 1 month from the date of the order of the
       Division Bench.
             7. On 04.11.2020, this Court issued the following order:
             “Issue notice.
             There shall be an ad-interim stay of operation of the impugned
 G
             judgment and order of the High Court.
             Counter affidavit within one week by Respondent No.1. Likewise,
             counter affidavit to be filed by the State within two weeks.
             Rejoinder affidavit within one week thereafter.”
 H
   M/S. GALAXY TRANSPORT AGENCIES, CONTRACTORS, TRADERS,                       1097
   TRANSPORTS AND SUPPLIERS v. M/S. NEW J.K. ROADWAYS, FLEET
    OWNERS AND TRANSPORT CONTRACTORS [R. F. NARIMAN, J.]

      8. As a result of this Court’s order, the Appellant has continued        A
executing the awarded work till date, with roughly 3 months left for the
completion of the contract period.
       9. Shri Rana Mukherjee, learned senior advocate appearing on
behalf of the Appellant, argued that the Division Bench was wrong on
both counts. According to him, a plain reading of Condition No. 31 of the      B
N.I.T. showed that “both HMV/LMV” had to be supplied, and as JK
Roadways only supplied a list of HMVs, it was obviously ineligible.
Further, he placed reliance upon the judgments of this Court stating that
the authority that floats the tender is the best judge on how a tender
condition should be read. Accordingly, the Division Bench overstepped
its mark in construing the eligibility conditions of the N.I.T. contrary to    C
the tendering authority’s interpretation. Insofar as the work experience
condition was concerned, he adverted to the work experience certificates
from the Financial Years 2014-2015 to 2018-2019, which showed that
the Appellant possessed the necessary work experience, which had also
been demonstrated to the Tender Opening Committee, which had, in               D
turn, reflected the same in a tender scrutiny report, showing that it had
applied its mind in rendering the Appellant a technically qualified bidder.
With respect to the service licence, Shri Mukherjee relied upon the
conclusions of the Single Judge and stated that since this contention was
given up before the Division Bench, this Court ought not to allow this
point to be re-agitated.                                                       E

       10. Shri Altaf H. Naik, learned senior advocate appearing on behalf
of JK Roadways, reiterated the three submissions made before the Single
Judge and also sought to argue that the work experience certificates
supplied by the Appellant were in the name of “Galaxy Agencies” and
therefore, could not be counted to the credit of the Appellant. He             F
vehemently argued that the Appellant did not possess a service licence
for the relevant period, the licence having expired on 31.03.2020 and not
having been renewed by the General Order, when properly read. Thus,
the eligibility conditions were not satisfied by the Appellant. Equally, the
Division Bench was right in saying that insofar as the work experience         G
requirement was concerned, the Appellant had only 1 year of experience,
which would not meet the essential requirement of the N.I.T. Finally, he
also advanced submissions on JK Roadways being qualified on a reading
of Condition No. 27 of the N.I.T.

                                                                               H
1098            SUPREME COURT REPORTS                          [2020] 12 S.C.R.


 A           11. Smt. Shashi Juneja, additional standing counsel appearing on
       behalf of the Union Territory of Jammu & Kashmir, supported the grant
       of the contract in favour of the Appellant and said that the Division
       Bench was incorrect in its construction of Condition No. 27 of the N.I.T.
       She also submitted that the Tender Opening Committee, being an expert
       body and having scrutinised the documents supplied by the Appellant,
 B
       cannot now be second-guessed by the judgment of the High Court.
              12. Having heard the learned counsel for the parties, it is first
       necessary to set out the N.I.T.’s “Terms and Conditions/Qualifying
       Criteria”. Condition Nos. 27 and 31 of the N.I.T., which are material to
       this case, state as follows:
 C
             “Terms and Conditions/Qualifying Criteria
                        xxx xxx xxx
             27. The firm/association shall have working experience of at least
             Five years with documentary proof and work should not [be] less
 D           [than] 2 Crores.
                        xxx xxx xxx
             31. The firm/tenderer should have owned at least 30 nos. of vehicles
             both HMV/LMV and attached 200 vehicles with the firm
             alongwith documentary proof.”
 E
             13. Even a cursory glance at Condition No. 31 of the N.I.T. would
       show that the 30 vehicles referred to, are “both HMV/LMV”. The
       tendering authority has construed this condition to mean that both types
       of vehicles, i.e., HMV and LMV, need to be included in the list of the 30
       vehicles submitted by each bidder.
 F
              14. In a series of judgments, this Court has held that the authority
       that authors the tender document is the best person to understand and
       appreciate its requirements, and thus, its interpretation should not be
       second-guessed by a court in judicial review proceedings. In Afcons
       Infrastructure Ltd. v. Nagpur Metro Rail Corporation Ltd., 2016
 G     (16) SCC 818, this Court held:
             “15. We may add that the owner or the employer of a project,
             having authored the tender documents, is the best person to
             understand and appreciate its requirements and interpret its
             documents. The constitutional courts must defer to this
 H
  M/S. GALAXY TRANSPORT AGENCIES, CONTRACTORS, TRADERS,                      1099
  TRANSPORTS AND SUPPLIERS v. M/S. NEW J.K. ROADWAYS, FLEET
   OWNERS AND TRANSPORT CONTRACTORS [R. F. NARIMAN, J.]

     understanding and appreciation of the tender documents, unless          A
     there is mala fide or perversity in the understanding or appreciation
     or in the application of the terms of the tender conditions. It is
     possible that the owner or employer of a project may give an
     interpretation to the tender documents that is not acceptable to
     the constitutional courts but that by itself is not a reason for
                                                                             B
     interfering with the interpretation given.”
                                                              (page 825)
                                                    (emphasis supplied)
      15. In the judgment in Bharat Coking Coal Ltd. v. AMR Dev
Prabha 2020 SCC OnLine SC 335, under the heading “Deference to               C
authority’s interpretation”, this Court stated:
     “51. Lastly, we deem it necessary to deal with another fundamental
     problem. It is obvious that Respondent No. 1 seeks to only enforce
     terms of the NIT. Inherent in such exercise is interpretation of
     contractual terms. However, it must be noted that judicial              D
     interpretation of contracts in the sphere of commerce stands on a
     distinct footing than while interpreting statutes.
     52. In the present facts, it is clear that BCCL and India have laid
     recourse to Clauses of the NIT, whether it be to justify condonation
     of delay of Respondent No. 6 in submitting performance bank             E
     guarantees or their decision to resume auction on grounds of
     technical failure. BCCL having authored these documents, is better
     placed to appreciate their requirements and interpret them. (Afcons
     Infrastructure Ltd v. Nagpur Metro Rail Corporation Ltd,
     (2016) 16 SCC 818 at para 15)                                           F
     53. The High Court ought to have deferred to this understanding,
     unless it was patently perverse or mala fide. Given how BCCL’s
     interpretation of these clauses was plausible and not absurd, solely
     differences in opinion of contractual interpretation ought not to
     have been grounds for the High Court to come to a finding that
                                                                             G
     the appellant committed illegality.”
                                                    (emphasis supplied)
      16. Further, in the recent judgment in Silppi Constructions
Contractors v. Union of India, 2019 SCC OnLine SC 1133, this
Court held as follows:                                                       H
1100             SUPREME COURT REPORTS                          [2020] 12 S.C.R.


 A           “20. The essence of the law laid down in the judgments referred
             to above is the exercise of restraint and caution; the need for
             overwhelming public interest to justify judicial intervention in
             matters of contract involving the state instrumentalities; the courts
             should give way to the opinion of the experts unless the decision
             is totally arbitrary or unreasonable; the court does not sit like a
 B
             court of appeal over the appropriate authority; the court must
             realise that the authority floating the tender is the best judge of its
             requirements and, therefore, the court’s interference should be
             minimal. The authority which floats the contract or tender, and
             has authored the tender documents is the best judge as to how the
 C           documents have to be interpreted. If two interpretations are
             possible then the interpretation of the author must be accepted.
             The courts will only interfere to prevent arbitrariness, irrationality,
             bias, mala fides or perversity. With this approach in mind we shall
             deal with the present case.”
 D                                                            (emphasis supplied)
              17. In accordance with these judgments and noting that the
       interpretation of the tendering authority in this case cannot be said to be
       a perverse one, the Division Bench ought not to have interfered with it
       by giving its own interpretation and not giving proper credence to the
 E     word “both” appearing in Condition No. 31 of the N.I.T. For this reason,
       the Division Bench’s conclusion that JK Roadways was wrongly declared
       to be ineligible, is set aside.
              18. Insofar as Condition No. 27 of the N.I.T. prescribing work
       experience of at least 5 years of not less than the value of Rs. 2 crores
 F     is concerned, suffice it to say that the expert body, being the Tender
       Opening Committee, consisting of four members, clearly found that this
       eligibility condition had been satisfied by the Appellant before us. Without
       therefore going into the assessment of the documents that have been
       supplied to this Court, it is well settled that unless arbitrariness or mala
       fide on the part of the tendering authority is alleged, the expert evaluation
 G     of a particular tender, particularly when it comes to technical evaluation,
       is not to be second-guessed by a writ court. Thus, in Jagdish Mandal
       v. State of Orissa, (2007) 14 SCC 517, this Court noted:
             “22. Judicial review of administrative action is intended to prevent
             arbitrariness, irrationality, unreasonableness, bias and mala fides.
 H
M/S. GALAXY TRANSPORT AGENCIES, CONTRACTORS, TRADERS,                         1101
TRANSPORTS AND SUPPLIERS v. M/S. NEW J.K. ROADWAYS, FLEET
 OWNERS AND TRANSPORT CONTRACTORS [R. F. NARIMAN, J.]

  Its purpose is to check whether choice or decision is made                  A
  “lawfully” and not to check whether choice or decision is “sound”.
  When the power of judicial review is invoked in matters relating
  to tenders or award of contracts, certain special features should
  be borne in mind. A contract is a commercial transaction.
  Evaluating tenders and awarding contracts are essentially
                                                                              B
  commercial functions. Principles of equity and natural justice stay
  at a distance. If the decision relating to award of contract is bona
  fide and is in public interest, courts will not, in exercise of power
  of judicial review, interfere even if a procedural aberration or error
  in assessment or prejudice to a tenderer, is made out. The power
  of judicial review will not be permitted to be invoked to protect           C
  private interest at the cost of public interest, or to decide contractual
  disputes. The tenderer or contractor with a grievance can always
  seek damages in a civil court. Attempts by unsuccessful tenderers
  with imaginary grievances, wounded pride and business rivalry, to
  make mountains out of molehills of some technical/procedural
                                                                              D
  violation or some prejudice to self, and persuade courts to interfere
  by exercising power of judicial review, should be resisted. Such
  interferences, either interim or final, may hold up public works for
  years, or delay relief and succour to thousands and millions and
  may increase the project cost manifold. Therefore, a court before
  interfering in tender or contractual matters in exercise of power           E
  of judicial review, should pose to itself the following questions:
        (i) Whether the process adopted or decision made by the
  authority is mala fide or intended to favour someone;
                                 or
                                                                              F
         Whether the process adopted or decision made is so
  arbitrary and irrational that the court can say: “the decision is
  such that no responsible authority acting reasonably and in
  accordance with relevant law could have reached”;
         (ii) Whether public interest is affected.                            G
  If the answers are in the negative, there should be no interference
  under Article 226. Cases involving blacklisting or imposition of
  penal consequences on a tenderer/contractor or distribution of
  State largesse (allotment of sites/shops, grant of licences,
                                                                              H
1102           SUPREME COURT REPORTS                          [2020] 12 S.C.R.


 A          dealerships and franchises) stand on a different footing as they
            may require a higher degree of fairness in action.”
                                                                (pages 531-532)
                                                            (emphasis supplied)
 B          19. Similarly, in Montecarlo Ltd. v. NTPC Ltd., 2016 (15)
       SCC 272, this Court stated as follows:
            “26. We respectfully concur with the aforesaid statement of law.
            We have reasons to do so. In the present scenario, tenders are
            floated and offers are invited for highly complex technical subjects.
 C          It requires understanding and appreciation of the nature of work
            and the purpose it is going to serve. It is common knowledge in
            the competitive commercial field that technical bids pursuant to
            the notice inviting tenders are scrutinised by the technical experts
            and sometimes third-party assistance from those unconnected with
            the owner’s organisation is taken. This ensures objectivity. Bidder’s
 D          expertise and technical capability and capacity must be assessed
            by the experts. In the matters of financial assessment, consultants
            are appointed. It is because to check and ascertain that technical
            ability and the financial feasibility have sanguinity and are workable
            and realistic. There is a multi-prong complex approach; highly
 E          technical in nature. The tenders where public largesse is put to
            auction stand on a different compartment. Tender with which we
            are concerned, is not comparable to any scheme for allotment.
            This arena which we have referred requires technical expertise.
            Parameters applied are different. Its aim is to achieve high degree
            of perfection in execution and adherence to the time schedule.
 F          But, that does not mean, these tenders will escape scrutiny of
            judicial review. Exercise of power of judicial review would be
            called for if the approach is arbitrary or mala fide or procedure
            adopted is meant to favour one. The decision-making process
            should clearly show that the said maladies are kept at bay. But
 G          where a decision is taken that is manifestly in consonance with
            the language of the tender document or subserves the purpose
            for which the tender is floated, the court should follow the principle
            of restraint. Technical evaluation or comparison by the court would
            be impermissible. The principle that is applied to scan and
            understand an ordinary instrument relatable to contract in other
 H
   M/S. GALAXY TRANSPORT AGENCIES, CONTRACTORS, TRADERS,                        1103
   TRANSPORTS AND SUPPLIERS v. M/S. NEW J.K. ROADWAYS, FLEET
    OWNERS AND TRANSPORT CONTRACTORS [R. F. NARIMAN, J.]

      spheres has to be treated differently than interpreting and               A
      appreciating tender documents relating to technical works and
      projects requiring special skills. The owner should be allowed to
      carry out the purpose and there has to be allowance of free play
      in the joints.”
                                                                (page 288)      B
      20. This being the case, we are unable to fathom how the Division
Bench, on its own appraisal, arrived at the conclusion that the Appellant
held work experience of only 1 year, substituting the appraisal of the
expert four-member Tender Opening Committee with its own.
       21. As was correctly pointed out by Shri Mukherjee, learned senior       C
counsel appearing on behalf of the Appellant, the contention as to the
invalidity of the Appellant’s service licence for the requisite period does
not appear to have been argued before the Division Bench, though argued
before and rejected by the learned Single Judge. This being the case, we
do not think that the scope of this appeal be enlarged to include any such      D
point which appears to have been given up before the Division Bench.
       22. Also, the argument that the Appellant has submitted work
experience certificates in the name of “Galaxy Agencies”, which is a
separate entity from “Galaxy Transport Agency”, has not been argued
either before the Single Judge or before the Division Bench. In this            E
circumstance, we reject this point also.
       23. The Division Bench’s judgment dated 16.10.2020 is therefore
set aside and the learned Single Judge’s judgment dated 30.06.2020 is
restored. The appeal is disposed of in the aforesaid terms.
                                                                                F
Ankit Gyan                                                Appeal disposed of.




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