Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | Government contract |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case(s) Referred | Referred Case 0 Referred Case 1 Referred Case 2 Referred Case 3 Referred Case 4 Referred Case 5 Referred Case 6 Referred Case 7 Referred Case 8 Referred Case 9 |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Allowed |
Headnote | Government contract: Tender – Award of – Scope of judicialreview – Held: Transparency is always required in such tendersbecause of the nature of economic activity carried on by the State –However, contours to examine are restricted – Objective is not tomake the Court an appellate authority to scrutinize as to whom thetender should be awarded – Economics must be permitted since thetendering authority knows best as to what is suited in terms oftechnology and price for them – In commercial tender matters thereis an aspect of commercial competitiveness – Merely because acompany is more efficient, obtains better technology, makes morecompetitive bids and, thus, succeeds more cannot be a factor todeprive that company of commercial success on that pretext –Furthermore, for every succeeding party who gets a tender theremay be parties who are not awarded the tender as there can be onlyone lowest tender – On facts, issuance of notice inviting tender forsupply of polyester bases hologram excise labels to be pasted acrossthe caps of bottles of liquor sold by the State Government withvarious technical specifications and eligibility criteria – Twoprospective tendering parties challenged the tendering process –Single Judge of the High Court dismissed the writ petitions –However, the Division Bench of the High Court by directing theState to float a fresh tender, erred in almost sitting as an appellateauthority on technology and commercial expediency which is notthe role which a Court ought to play – It appears that the twoprospective tendering parties endeavoured to continuously createimpediments in the way of the succeeding party merely because theycould not succeed – When the concerned Committees were lookinginto the suggestions of the prospective parties, the parties moved tothe court – Few issues raised by the parties have already beenaddressed by the Committees – Thus, the order passed by theDivision Bench cannot be sustained and is set aside – Constitution of India – Art. 226. Costs: Commercial matters – Award of costs – Held: Usually the judicial system hesitates to impose costs, presuming it to be a reflection on the counsel – In a tussle for enforcement of rights against a State different principle apply – However, in commercial matters costs must follow the cause – Tender jurisdiction was created for scrutiny of commercial matters – If parties continuously seek to challenge award of tenders, the succeeding party must get costs and the party which loses must pay costs – On facts, parties litigating are financially strong and took a commercial decision to carry the dispute right up to this Court – They must face the consequences and costs of success or failure in the present proceedings – Furthermore, the instant proceedings do arise from a writ proceeding u/Art. 226 but it is really a commercial dispute, thus, the failing party cannot contend that the present dispute is a writ proceeding – Actual costs quantified on the basis of the bill of fee and costs – Issuance of direction to the respondent companies to pay Rs 23 lakh to the appellant-successful tenderer, and Rs 7.5 lakhs to State Government for defending the litigation. Costs: Award of – Principles prevailing in England, United States of America, Australia, Hong Kong and Canada while awarding Costs in Civil litigation and Commercial litigation – Stated. |
Judge | Hon'ble Mr. Justice Sanjay Kishan Kaul |
Neutral Citation | 2021 INSC 492 |
Petitioner | Uflex Ltd. |
Respondent | Government Of Tamil Nadu & Ors. |
SCR | [2021] 7 S.C.R. 571 |
Judgement Date | 2021-09-17 |
Case Number | 4862-4863 |
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