# Ravi Offset Printers & Publishers Pvt Ltd., Agra v. State of U.P. & Ors

- **Citation:** (2022) 6 ILRA 199
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2022-05-11
- **Bench:** Vivek Kumar Birla, Vikas Budhwar
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/ravi-offset-printers-publishers-pvt-ltd-agra-v-state-of-u-p-ors-48653
- **Pages:** 22

## Headnote

A. Constitution of India - Article 19 -
Contract matter - Policy decision - Judicial
interference - Scope - Validity of clause
9(A) of E-tender was challenged - Held, in
the matter of a policy decision so taken by
the tender issuing authorities, a judicial
restrain is to be resorted to and merely
because certain terms and conditions seems
to be not suitable to a particular party
cannot be a ground to hold it illegal,
arbitrary or in violation of Article 19 of the
Constitution of India - Clause 9 (1) and (4)
of Clause 9-A of the tender dated 21.4.2022
does not suffer from any infirmity or
illegality and the same is confirmity and
consonance
under
Article
19
of
the
Constitution of India. (Para 29 and 35)
Writ petition dismissed (E-1)
List of Cases cited :-

## Text

_Characters 0–39,870 of 75,721. This is a partial read: ask again with offset=39870 for what follows._

6 All. Ravi Offset Printers & Publishers Pvt. Ltd., Agra Vs. State of U.P. & Ors.
199
to Rule 18. In fact, as held above, there is
no scope of such a condition coming in
conflict with Rule 18 , as it operates in a
different field.

13. Apart from the above, we also
find sufficient force in the submission of
learned counsel for respondents no.2 to 5
that the contract work having been settled
in favour of respondents no.6 and 7 long
back in the month of January, 2022 itself, it
is not a fit case to interfere.

14. Having regard to the above
discussion, the writ petition fails and is
hereby dismissed.
----------
(2022)06ILR A199
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 11.05.2022

BEFORE

THE HON'BLE VIVEK KUMAR BIRLA, J.
THE HON'BLE VIKAS BUDHWAR, J.

Writ-C No. 13077 Of 2022

Ravi Offset Printers & Publishers Pvt Ltd.,
Agra ...Petitioner
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Petitioner:
Sri Shashi Nandan(Senior Advocate), Sri Kunal
Ravi Singh, Manjari Singh

Counsel for the Respondents:
C.S.C.

A. Constitution of India - Article 19 -
Contract matter - Policy decision - Judicial
interference - Scope - Validity of clause
9(A) of E-tender was challenged - Held, in
the matter of a policy decision so taken by
the tender issuing authorities, a judicial
restrain is to be resorted to and merely
because certain terms and conditions seems
to be not suitable to a particular party
cannot be a ground to hold it illegal,
arbitrary or in violation of Article 19 of the
Constitution of India - Clause 9 (1) and (4)
of Clause 9-A of the tender dated 21.4.2022
does not suffer from any infirmity or
illegality and the same is confirmity and
consonance
under
Article
19
of
the
Constitution of India. (Para 29 and 35)
Writ petition dismissed (E-1)
List of Cases cited :-
1. Bareilly Development Authority & anr. Vs Ajai
Pal Singh & ors. 1989 (2) SCC 116
2. St. of Gujrat & anr. Vs Meghji Pethraj Shah
Charitable Trust & ors. 1994 (3) SCC 552
3. St. of U.P. & ors. Vs Bridge & Roof Company
(India) Ltd.; 1996 (6) SCC 22
4. India Thermal Power Ltd. Vs St. of M.P. & ors.
2000 (3) SCC 379
5. Tata Cellular Vs U.O.I.; 1994 (6) SCC 651
6. Caretel Infotech Ltd. Vs Hindustan Petroleum
Corp. Ltd. & ors. 2019 (14) SCC 81,
7. Uflex Limited Vs Government of Tamil Nadu &
ors. 2022 (1) SCC 165
8. National High Speed Rail Corp. Ltd. Vs
Montecarlo Ltd. & anr.; AIR (2022) SC 866
9. M/s Agmatel India Pvt. Ltd. Vs M/s. Resoursys
Telecom & ors. AIR (2022) SC 1103
10. Monark Infrastructure (P) Ltd. Vs Commercial
Ullas Nagar Municipality & ors. AIR (2000) SC 2272
(Delivered by Hon'ble Vivek Kumar Birla,
J. & Hon'ble Vikas Budhwar, J.)

1. The extent and the scope of judicial
interference in writ jurisdiction in the
matter of tenders so floated by public
authorities is the subject matter of present
proceedings.

2. Factual matrix of the case as
worded in the present petition are that the
petitioner claims itself to be a private
200 INDIAN LAW REPORTS ALLAHABAD SERIES
limited company by the name and style of
Ravi Offset Printers And Publishers Pvt.
Ltd. having its office at C-60, 61, 62, 63
EPIP, Shasti puram, Agra-282007 engaged
in the trade of printing and supply of books
pertaining to educational stream in the
State of U.P. According to the petitioner, it
applied for e-tender referable to the
academic years 2020-2021 and 2021-2022
for providing the books pertaining to
NCERT (National Council of Educational
Research and Training). It has come on
record that in the year 2020 itself the
petitioner participated in the e-tender and
deposited the earnest money in the form of
FDR no. 774111 for an amount of Rs.
12,62,000/- along with the prescribed
tender fee and thereafter, the petitioner was
found to be the lowest bider and awarded
contract which eventually culminated into
execution of agreement of 03.03.2020
between
the
second
respondent
(Madhyamik Shiksha Parishad) on one
hand and the petitioner on the other hand
for the purpose in printing and supply of
NCERT books for class IXth to XIIth for
the
student
studying
in
Government
aided/unaided recognized schools in State
of U.P.. It has further been averred that a
work order was on 07.03.2020 with regard
to printing and distribution of of NCERT
books.

3. Pleadings further reveals that due
to the onslaught of the pandemic relating
Covid-19 a nationwide lockdown was put
to motion resulting that all the commercial
activities came to stands still and the
petitioner could not execute agreements
and honour the commitments and the
obligations which it wanted to discharge as
a bidder. On account of the circumstances
so occasioned as referred to above certain
disputes arose between the petitioner and
the second respondent with regard to the
payment of royalty and GST amount
necessitating issuance of demand notice
dated 12.03.2020, 18.06.2020, 10.08.2020,
01.10.2020, 24.11.2020 and 30.12.2020
seeking recovery of a certain amount. The
petitioner herein as per its own saying took
recourse to arbitration while invoking
arbitration clause and thereafter, preferred
an Arbitration and Cancellation Application
under Section 11(4) no. 14 of 2021 being
(Ravi Offset Printers And Publishers Pvt.
Ltd. s. Madhyamic Siksha Parishad U.P.)
before the Court which came to be decided
while appointing one of the retired judge of
this Court as the sole arbitrator. Record
further reveals that the petitioner preferred
claim petition before the sole arbitrator
which is annexed as annexure-3 at page no.
36 of the petition along with stay
application seeking following reliefs:-

"(ii) Set-aside the Impugned Demand
Notices dated 12.03.2020, 18.06.2020,
10.08.2020, 01.10.2020 & 24.11.2020 as
well as impugned Order dated 30.12.2020.

(iv) Direct the Opposite Party to
discharge/release the FDR No.774111 dated
03.02.2020, amounting to Rs. 12,62,000/-,
deposited by the Claimant as Earnest
Money Deposit."

4. According to the learned counsel
for the petitioner the arbitration proceeding
which are stated to be pending before the
sole arbitrator being arbitration case no. 14
of 2021 was begin lingered on, on account
of non-cooperation of respondents as they
have not even deposited the fee of the
learned
Arbitrator
and
in
fact
on
22.03.2022 the petitioner got deposited the
entire fee execution of the respondents
herein

5. Record further reveals that an etenders has been again issued by the second
6 All. Ravi Offset Printers & Publishers Pvt. Ltd., Agra Vs. State of U.P. & Ors.
201
respondent on 21.04.2022 for procurement
of books of NCERT for the academic year
2022-2023 for class IXth to XIIth copy of
the e-tender dated 21.04.2022 is at page no.
16 of the writ petition.

6. Relevant extract of the offending
provision of e-tender notice dated 21.04.2022
referable to the academic year 2022-2023
which is subject matter of the present petition
is being quoted hereinunder:-

"पूिय के ऐसे प्रक शक / मुद्रक वजि पर
म ध्यवमक वशक्ष पररर्द, उत्तर प्रदेश क
जी०एस०टी० सवहत र यल्टी िक य है उिकी
विविद यें विच रणीय िहीां होिी।

वकसी प्रक र क विवधक विि द वशक्ष
विभ ि के स थ ि हो।"

7. Alleging the sub clause 1 and sub
clause 4 of clause 9 (A) of e-tender dated
21.04.2022 being in violation of Article 19 of
the Constitution of India besides being
arbitrarily
discriminatory,
the
petitioner
herein has filed the present petition seeking
following reliefs:-

"(I) Issue a writ order or direction in
nature of certiorari quashing the sub clause 1
and 4 of clause 9 (A) of tender dated
21.04.2022 (Annexure-1) with regard to
ineligibility of the petitioner to apply for the
tender.

(II) Any other or further relief with the
Court may deem fit and proper under the
facts and circumstances of the case;

(III) Award the cost of writ petition."

8. Heard Sri Shashi Nandan,learned
Senior Counsel assisted by Sri Kunal Ravi
Singh, learned counsel for the petitioner as
well as Sri Amit Kumar Singh, learned
Additional Chief Standing who appears for
the respondents.

9. Sri Shashi Nandan learned Standing
Counsel assisted by Sri Kunal Ravi Singh has
made the following submissions:-

A. The e-tender dated 21.04.2022
containing the conditions under the heading
sub clause 1 and 4 of clause 9 (A) is not
only arbitrary discriminatory and illegal but
it is violative under Article 19 of the
Constitution of India.

B. Merely because certain disputes
have been raised by second respondent,
Madhyamik Shiksha Parishad with regard
to payment of royalty and GST for the
preceding academic years, it will not
denude the petitioner of its fundamental
right to profess its trade while participating
in the tender and exclude it from the zone
of consideration.

C. Zone of consideration cannot be
compartmentalised in such a manner so as
to exclude in participating in the bid
particularly when the stage of screening
would come subsequently, when the bids
are to be finalized.
D. In absence of any quantification of the
amount of royalty and GST so claimed by
the second respondent, the same cannot
partake the character of a dispute or
exclude the petitioner from zone of
consideration.

10. Sri Amit Kumar Singh, learned
Additional Chief Standing Counsel has
opposed the writ petition while arguing that
the present wit petition so instituted at the
behest of the petitioner, is not maintainable
as by virtue of the present writ petition, the
petitioner is seeking relief of alteration of
the terms and the condition so embodied in
the e-tender. It has been further argued by
Sri Singh that it is the province of the
employer/tender
issuing
authority
to
engraft terms and conditions which is not
within the realm of Article 226 of the
202 INDIAN LAW REPORTS ALLAHABAD SERIES
Constitution of India. In nutshell, the
submission of learned Additional Chief
Standing Counsel is to the extent that the
petitioner being one of the aspirant cannot
dictate that a particular condition should be
engrafted in the tender which suits to it.

11. We have heard the learned
counsels for the parties and perused the
record.

12. Undisputedly, petitioner claims
itself to be one of the aspirant who wanted
to participate in the e-tender so issued on
21.04.2022 for procurement of books of
NCERT for the academic year 2022-2023
for the class of IXth to XIIth.

13. According to Sri Shashi Nandan,
learned Senior Counsel, the only obstacle
which denudes the petitioner to come
within the zone of consideration is sub
clause 1 and 4 of Clause 9 (A) of the etender dated 21.04.2022.

14. So far as the sub clause on of
Clause 9 (A) of e-tender itself provides that
one of the essential condition to participate
in the e-tender is this that an aspirant
should not be defaulter with respect to
payment of royalty and GST. Similarly, the
sub clause 4 of Clause 9 (A) of the tender
condition itself shows that an intending
party who participates in the tender should
not have any legal dispute with respondent
no. 2, Madhyamik Shiksha Parishad.

15. In case in hand this Court finds
that there exists certain disputes referable
to non-payment of royalty and GST at the
end of the petitioner pursuant thereon
demand notices were issued for recovery of
certain amount which was quantified and
the same was carried in arbitration pursuant
whereto by the order of this Court sole
arbitration has been appointed for the
arbitration proceedings are stated to be
pending.

16. Now a question arises as to
whether, the conditions so embodied in sub
clause 1 and 4 of Clause 9 (A) of the etenders can be held to be illegal arbitrary or
violative of Article 19 of the Constitution
of India at the behest of the petitioner
wherein the petitioner admittedly has
certain disputes with the respondent no. 2
and the matter is stated to pending before
arbitrator wherein after quantification of
the amount referable to royalty and GST
demand notice has been issued.

17. Another issue which needs to be
noticed is the scope of judicial intervention
in
the
matter
of
prescription
the
covenant/terms and the conditions engrafed
in the tender.

18. The Hon'ble Apex Court in the
case
of
Bareilly
Development
Authority And Another Vs. Ajai Pal
Singh And Others reported in 1989 (2)
SCC 116 in paragraph no. 22 has
observed as under:-

"22. There is a line of decisions where
the contract entered into between the State
and the persons aggrieved is non- statutory
and purely contractual and the rights are
governed only by the terms of the contract,
no writ or order can be issued under
Article 226 of the Constitution of India so
as to compel the authorities to remedy a
breach of contract pure and simple
Radhakrishna Agarwal & Ors. v. State of
Bihar & Ors., [1977] 3 SCR 249; Premji
Bhai Parmar & Ors. etc. v. Delhi
Development Authority & Ors, [1980] 2
SCR 704 and D.F.O. v. Biswanath Tea
Company Ltd. 1981 3 SCR 662."
6 All. Ravi Offset Printers & Publishers Pvt. Ltd., Agra Vs. State of U.P. & Ors.
203

19. The Hon'ble Apex Court in the
case of State of Gujrat and Anothers vs.
Meghji Pethraj Shah Charitable Trust
And Others 1994 (3) SCC 552 in
paragraph no. 22 has observed as under:-

"22. We are unable to see any
substance in the argument that the
termination
of
arrangement
without
observing the principle of natural justice
(audi alterant partem) is void. The
termination is not a quasi-judicial act by
any stretch of imagination; hence it was not
necessary to observe the principles of
natural justice. It is not also an executive
or administrative act to attract the duty to
act fairly. It was - as has been repeatedly
urged by Sri Ramaswamy - a matter
governed by a contract/agreement between
the parties. If the matter is governed by a
contract,
the
writ
petition
is
not
maintainable since it is a public law
remedy and is not available in private law
field, e.g., where the matter is governed by
a non-statutory contract. Be that as it may,
in view of our opinion on the main
question, it is not necessary to pursue this
reasoning further."

20. In the case of State of U.P. and
Others vs. Bridge & Roof Company
(India) Ltd. reported in 1996 (6) SCC 22,
the Hon'ble Apex Court in paragraph nos.
15 and 16 has observed as under:-

"15. In our opinion,the very remedy
adopted
by
the
respondent
is
misconceived. It is not entitled to any
relief in these proceedings,i.e,in the writ
petition filed by it.The High court
appears to be right in not pronouncing
upon any of the several contentions
raised in the writ petition by both the
parties and in merely reiteration the
effect of the order of the Deputy
commissioner made under the proviso to
section 8-D (1).
16. Firstly, the contract between the
parties is a contract in the realm of
private law. It is governed by the
provisions of the contract Act or may
be,also by certain provisions of the sale
of Goods Act.Any dispute relating to
interpretation of the terms and conditions
of such a contract cannot be agitated,
and could not have been agitated,in a
writ petition. That is a matter either for
arbitration as provided by the contract of
for Civil court as the case may be.
whether any amount is due to the
respondent
from
the
appellantGovernment under the contract and,if
so,how much and the further question
whether retention or refusal to pay any
amount by the Government is justified, or
not are all matters which cannot be
agitated in or adjudicated upon in a writ
petition.
The
prayer
in
the
writ
petition,viz.,to restrain the Government
from deducting particular amount from
the writ petitioner's bill(s) was not a
prayer which could be granted by the
High court under Article 226. Indeed, the
High Court has not granted the said
prayer."

21. In the case of India Thermal
Power Ltd. vs. State of M.P. And Others
2000 (3) SCC 379, the Hon'ble Apex Court
in paragraph no. 11 has observed as under:-

"11. It was contended by Mr. Cooper,
learned senior counsel appearing for
appellant GBL and also by some counsel
appearing for other appellants that the
appellant/IPPs had entered into PPAs
under Sections 43 and 43A of the
Electricity Supply act and as such they are
statutory contracts and, therefore, MPEB
had no power or authority to alter their
204 INDIAN LAW REPORTS ALLAHABAD SERIES
terms and conditions. This contention has
been upheld by the High Court, in our
opinion the said contention is not correct
and High Court was wrong in accepting the
same. Section 43 empowers Electricity
Board to enter into arrangement for
purchase of electricity on such terms as
may be agreed. Section 43 A(l) provides
that a generating company may enter into a
contract
for
the
sale
of
electricity
generated by it with Electricity Board, As
regards the determination of tariff for the
sale of electricity by a generating company
to the Board, Section 43(1)(2) provides that
the tariff shall be determined in accordance
with the norms regarding operation and
plant load factor as may be laid down by
the authority and in accordance with the
rates of depreciation and reasonable return
and such other factors as may be
determined from time to time by the Central
Government by a notification in the official
gazette. These provisions clearly indicate
that the agreement can be on such terms as
may be agreed by the parties except that
the tariff is to be determined in accordance
with the provision con-tained in section
43A(2) and notifications issued thereunder.
Merely be-cause a contract is entered into
in exercise of an enabling power conferred
by a statute that by itself cannot render the
contract a statutory contract. If entering
into a contract containing prescribed terms
and conditions is a must under the statute
then that contract becomes a statutory
contract. If a contact incorporates certain
terms and conditions in it which are
statutory then the said contract to that
extent is statutory. A contact may contain
certain other terms and conditions which
may not be of a statutory character and
which have been incorporated therein as a
result of mutual agreement between the
parties. Therefore, the PPAs can be
regarded as statutory only to the extent that
they contain provisions regarding determination of tariff and other statutory
requirements of Section 43A(2). Opening
and maintaining of an Escrow Account or
an Escrow Agreement are not the statutory
requirements
and,
therefore,
merely
because PPAs contemplate maintaining
Escrow Accounts that obligation cannot be
regarded as statutory."

22. Proposition of law so called out in
the above noted judgments itself draws
irresistible conclusion that merely because
a contract has been floated by the
Government or its instrumentalities would
not be said to be a statutory contract
amenable to writ jurisdiction as even
otherwise there is a marked difference
between a contract floated as a commercial
venture and a statutory contract.

23. Another facet which needs to be
addressed is with regard to the fact as to the
scope of judicial intervention in the matter
of tenders and contracts while using
judicial platform so as to advise the tender
enacting authority to include certain
conditions and to exclude some conditions
which finds its presence in the contract
itself.

24. The Hon'ble Apex Court in the
case of Tata Cellular vs. Union of India
reported in 1994 (6) SCC 651 in
paragraph no. 94 has observed as under:-

"94. The principles deducible from the
above are :

(1) The modem trend points to judicial
restraint in administrative action.

(2) The court does not sit as a court of
appeal but merely reviews the manner in
which the decision was made.
(3) The court does not have the
expertise to correct the administrative
6 All. Ravi Offset Printers & Publishers Pvt. Ltd., Agra Vs. State of U.P. & Ors.
205
decision. If a review of the administrative
decision is permitted it will be substituting
its own decision, without the necessary
expertise which itself may be fallible.
(4) The terms of the invitation to
tender cannot be open to judicial scrutiny
because the invitation to tender is in the
realm of contract.
Normally speaking, the decision to
accept the tender or award the contract is
reached by process of negotiations through
several tiers. More often than not, such
decisions are made qualitatively by experts.
(5) The Government must have
freedom of contract. In other words, a fair
play
in
the
joints
is
a
necessary
concomitant for an administrative body
functioning in an administrative sphere or
quasi-administrative sphere. However, the
decision must not only be tested by the
application of Wednesbury principle of
reasonableness (including its other facts
pointed out above) but must be free from
arbitrariness not affected by bias or
actuated by mala fides.
(6) Quashing decisions may impose
heavy
administrative
burden
on
the
administration and lead to increased and
unbudgeted expenditure.
Based on these principles we will
examine the facts of this case since they
commend to us as the correct principles."

25. In the case of Caretel Infotech
Limited
vs.
Hindustan
Petroleum
Corporation Limited And Others reported
in 2019 (14) SCC 81, the Hon'ble Apex
Court in paragraph nos. 37 to 43 has
observed as under :-

"37. We consider it appropriate to
make certain observations in the context of
the nature of dispute which is before us.
Normally parties would be governed by
their contracts and the tender terms, and
really no writ would be maintainable under
Article 226 of the Constitution of India. In
view of Government and Public Sector
Enterprises
venturing
into
economic
activities, this Court found it appropriate to
build in certain checks and balances of
fairness in procedure. It is this approach
which has given rise to scrutiny of tenders
in writ proceedings under Article 226 of the
Constitution of India. It, however, appears
that the window has been opened too wide
as almost every small or big tender is now
sought to be challenged in writ proceedings
almost as a matter of routine. This in turn,
affects the efficacy of commercial activities
of the public sectors, which may be in
competition with the private sector. This
could hardly have been the objective in
mind. An unnecessary, close scrutiny of
minute details, contrary to the view of the
tendering authority, makes awarding of
contracts by Government and Public
Sectors a cumbersome exercise, with long
drawn out litigation at the threshold. The
private sector is competing often in the
same field. Promptness and efficiency
levels in private contracts, thus, often tend
to make the tenders of the public sector a
non-competitive exercise. This works to a
great disadvantage to the Government and
the Public Sector.

38.
In
Afcons
Infrastructure
Limited v. Nagpur Metro Rail Corporation
Limited & Anr.3, this Court has expounded
further on this aspect, while observing that
the decision making process in accepting or
rejecting the bid should not be interfered
with. Interference is permissible only if the
decision making process is arbitrary or
irrational to an extent that no responsible
authority,
acting
reasonably
and
in
accordance with law, could have reached
such a decision. It has been cautioned that
Constitutional Courts are expected to
206 INDIAN LAW REPORTS ALLAHABAD SERIES
exercise restraint in interfering with the
administrative decision and ought not to
substitute 3 (2016) 16 SCC 818 their view
for that of the administrative authority.
Mere disagreement with the decision
making process would not suffice.
 39. Another aspect emphasised is that
the author of the document is the best
person to understand and appreciate its
requirements. In the facts of the present
case, the view, on interpreting the tender
documents, of respondent No.1 must
prevail.
Respondent
No.1
itself,
appreciative of the wording of clause 20
and the format, has taken a considered
view. Respondent No.3 cannot compel its
own interpretation of the contract to be
thrust on respondent No.1, or ask the Court
to compel respondent No.1 to accept that
interpretation. In fact, the Court went on to
observe in the aforesaid judgment that it is
possible that the author of the tender may
give an interpretation that is not acceptable
to the Constitutional Court, but that itself
would not be a reason for interfering with
the interpretation given. We reproduce the
observations in this behalf as under:

"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
understanding and appreciation of the
tender documents, unless 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
interfering
with
the
interpretation given."

40. We may also refer to the
judgment of this Court in Nabha Power
Limited (NPL) v. Punjab State Power
Corporation Limited (PSPCL) & Anr.,4
authored by one of us (Sanjay Kishan Kaul,
J.). The legal principles for interpretation of
commercial contracts have been discussed.
In the said judgment, a reference was made
to the observations of the Privy Council in
Attorney General of Belize v. Belize
Telecom Ltd. 5 as under:

"16. Before discussing in greater
detail the reasoning of the Court of Appeal,
the Board will make some general
observations
about
the
process
of
implication. The court has no power to
improve upon the instrument which it is
called upon to construe, whether it be a
contract, a statute or articles of association.
It cannot introduce terms to make it fairer
or more reasonable. It is concerned only to
discover what the instrument means.
However, that meaning is not necessarily or
always what the authors or parties to the
document would have intended..." .... .... ....
.... ....

"19. .....In Trollope & Colls Ltd.
v. North West Metropolitan Regional
Hospital Board [1973] 1 WLR 601, 609
Lord Pearson, with whom Lord Guest and
Lord Diplock agreed, said:

"the court does not make a
contract for the parties. The court will not
even improve the contract which the parties
have
made
for
themselves,
however
desirable the improvement might be. The
court's function is to interpret and apply the
contract which the parties have made for
themselves. If the express terms are
perfectly clear and free from ambiguity,
there is no choice to be made between
different possible meanings: the clear terms
must be applied even if the court thinks
some other terms would have been more
6 All. Ravi Offset Printers & Publishers Pvt. Ltd., Agra Vs. State of U.P. & Ors.
207
suitable. An unexpressed term can be
implied if and only if the court finds that
the parties must have intended that term to
form part of their contract: it is not enough
for the court to find that such a term would
have been adopted by the parties as
reasonable men if it had been suggested to
them: it must have been a term that went
without saying, a term necessary to give
business efficacy to the contract, a term
which, though tacit, formed part of the
contract which the parties made for
themselves."

41. Nabha Power Limited (NPL)6
also took note of the earlier judgment of
this court in Satya Jain (Dead) Through
LRs. and Ors. vs. Anis Ahmed Rushdie
(Dead) Through LRs. and Ors.7, which
discussed the principle of business efficacy
as proposed by Bowen, L.J. in the
Moorcock8. It has been elucidated that this
test requires that terms can be implied only
if it is necessary to give business efficacy to
the contract to avoid failure of the contract
and only the bare minimum of implication
is to be there to achieve this goal. Thus, if
the contract makes business sense without
the implication of terms, the courts will not
imply the 6 (supra) 7 (2013) 8 SCC 131 8
(1889) LR 14 PD 64 (CA) same.

42. The judgment in Nabha
Power Limited (NPL) 9 concluded with the
following observations in para 72:

"72. We may, however, in the
end, extend a word of caution. It should
certainly
not
be
an
endeavour
of
commercial courts to look to implied terms
of contract. In the current day and age,
making of contracts is a matter of high
technical expertise with legal brains from
all sides involved in the process of drafting
a contract. It is even preceded by
opportunities of seeking clarifications and
doubts so that the parties know what they
are getting into. Thus, normally a contract
should be read as it reads, as per its express
terms. The implied terms is a concept,
which is necessitated only when the Pentatest referred to aforesaid comes into play.
There has to be a strict necessity for it. In
the present case, we have really only read
the contract in the manner it reads. We have
not really read into it any ''implied term' but
from the collection of clauses, come to a
conclusion as to what the contract says. The
formula for energy charges, to our mind,
was quite clear. We have only expounded it
in accordance to its natural grammatical
contour, keeping in mind the nature of the
contract."
43. We have considered it appropriate
to, once again, emphasise the aforesaid
aspects, especially in the context of
endeavours of courts to give their own
interpretation
to
contracts,
more
specifically tender terms, at the behest of a
third party competing for the tender, rather
than what is propounded by the party
framing the tender. The object cannot be
that in every contract, where some parties
would lose out, they should get the 9
(supra) opportunity to somehow pick holes,
to disqualify the successful parties, on
grounds on which even the party floating
the tender finds no merit." \

26. Following the judgments, the
Hon'ble Apex Court in the case of Uflex
Limited vs. Government of Tamil Nadu
And Others reported in 2022 (1) SCC 165
in paragraph no. 43 has observed as under
:-

"43. The present dispute has its
history in many prior endeavours by the
original petitioners which have proved to
be unsuccessful. It does appear that in a
competitive market they have not been so
successful as they would like to be. Merely
because a company is more efficient,
208 INDIAN LAW REPORTS ALLAHABAD SERIES
obtains better technology, makes more
competitive bids and, thus, succeeds more
cannot be a factor to deprive that company
of commercial success on that pretext. It
does appear to us that this is what is
happening; that the two original petitioners
are endeavouring to continuously create
impediments in the way of the succeeding
party merely because they themselves had
not so succeeded. It is thus our view that
the Division Bench has fallen into an error
in almost sitting as an appellate authority
on technology and commercial expediency
which is not the role which a Court ought
to play."

27. Recently, in the case of National
High Speed Rail Corporation Limited vs.
Montecarlo Limited And Another reported
in AIR (2022) SC 866, the Hon'ble
Supreme Court in paragraph nos. 7.6, 7.7,
7.8, 7.8(1), 7.8(2), 7.8(3) and 7.8(4) has
observed as under :-

"7.6 At this stage, it is to be noted
that what can be said to be substantially
responsive Technical Bid has been defined
under Article 33.2. The High Court in the
impugned order has observed and held that
the Bid submitted by the original writ
petitioner can be said to be substantially
responsive Technical Bid. However, it is
required to be noted that when the author of
the tender document, in the present case,
JICC/JICA, had taken a conscious decision
that the Bid submitted by the respondent -
original writ petitioner can be said to be
non-responsive and suffering from material
deviation, it was not for the High Court to
consider/opine whether the Bid submitted
by
the
original
writ
petitioner
is
substantially responsive Technical Bid or
not unless the decision is found to be
perverse and/or suffered from mala fides
and/or favoritism.

7.7 At the cost of repetition, it is
to be noted that under the contractual
obligation, it was not open for the appellant
- corporation and/or even the Republic of
India to deviate from any of the terms and
conditions of the loan agreement and/or the
decision of JICC/JICA. Therefore, in
absence
of
any
allegation
of
mala
fides/arbitrariness and/or favouritism, we
are of the opinion that the High Court has
committed a grave error in interfering with
a
conscious
decision
taken
by
the
JICC/JICA, which has been followed by
the appellant.

7.8 At this stage, few decisions of
this Court on the interference by the Courts
in the tender matters are required to be
referred to:-

7.8.1 In the case of Afcons
Infrastructure Limited Vs. Nagpur Metro
Rail Corporation Limited, AIR 2016 SC
4305, this Court in paras 11 to 13 and 15
has observed and held as under :-

"11.
Recently,
in
Central
Coalfields Ltd. v. SLL-SML (Joint Venture
Consortium), (2016) 8 SCC 622, it was
held by this Court, relying on a host of
decisions that the decision- making process
of the employer or owner of the project in
accepting or rejecting the bid of a tenderer
should not be interfered with. Interference
is permissible only if the decision-making
process is mala fide or is intended to favour
someone. Similarly, the decision should not
be interfered with unless the decision is so
arbitrary or irrational that the Court could
say that the decision is one which no
responsible authority acting reasonably and
in accordance with law could have reached.
In other words, the decision- making
process or the decision should be perverse
and not merely faulty or incorrect or
erroneous. No such extreme case was made
out by GYT-TPL JV in the High Court or
before us.
6 All. Ravi Offset Printers & Publishers Pvt. Ltd., Agra Vs. State of U.P. & Ors.
209

12. In Dwarkadas Marfatia and
Sons v. Port of Bombay, (1989) 3 SCC 293,
it was held that the constitutional courts are
concerned
with
the
decision-making
process. Tata Cellular v. Union of India,
(1994) 6 SCC 651 went a step further and
held that a decision if challenged (the
decision having been arrived at through a
valid process), the constitutional courts can
interfere if the decision is perverse.
However, the constitutional courts are
expected to exercise restraint in interfering
with the administrative decision and ought
not to substitute its view for that of the
administrative
authority.
This
was
confirmed in Jagdish Mandal v. State of
Orissa, (2007) 14 SCC 517, as mentioned
in Central Coalfields Ltd. v. SLL-SML
(Joint Venture Consortium), (2016) 8 SCC
622 (AIR) 2016 SC 3814

13. In other words, a mere
disagreement with the decision-making
process
or
the
decision
of
the
administrative authority is no reason for a
constitutional court to interfere. The
threshold of mala fides, intention to favour
someone or arbitrariness, irrationality or
perversity
must
be
met
before
the
constitutional court interferes with the
decision-making process or the decision.
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
understanding and appreciation of the
tender documents, unless 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
interfering
with
the
interpretation given.

7.8.2 In the case of B.S.N. Joshi
& Sons Ltd. Vs. Nair Coal Services Ltd.
and Ors., (2006) 11 SCC 548, after
considering the various decisions of this
Court on the point enumerated in para 66,
this Court has observed and held as under:

"66. We are also not shutting our
eyes towards the new principles of judicial
review which are being developed; but the
law as it stands now having regard to the
principles laid down in the aforementioned
decisions may be summarised as under:

(i)
if
there
are
essential
conditions, the same must be adhered to;

(ii) if there is no power of general
relaxation, ordinarily the same shall not be
exercised and the principle of strict
compliance would be applied where it is
possible for all the parties to comply with
all such conditions fully;

(iii) if, however, a deviation is
made in relation to all the parties in regard
to any of such conditions, ordinarily again
a power of relaxation may be held to be
existing;

(iv) the parties who have taken
the benefit of such relaxation should not
ordinarily be allowed to take a different
stand in relation to compliance with
another part of tender contract, particularly
when he was also not in a position to
comply with all the conditions of tender
fully, unless the court otherwise finds
relaxation of a condition which being
essential in nature could not be relaxed and
thus the same was wholly illegal and
without jurisdiction;

(v) when a decision is taken by
the
appropriate
authority
upon
due
consideration of the tender document
submitted by all the tenderers on their own
merits and if it is ultimately found that
successful bidders had in fact substantially
210 INDIAN LAW REPORTS ALLAHABAD SERIES
complied with the purport and object for
which essential conditions were laid down,
the same may not ordinarily be interfered
with;

(vi) the contractors cannot form a
cartel. If despite the same, their bids are
considered and they are given an offer to
match with the rates quoted by the lowest
tenderer, public interest would be given
priority;

(vii) where a decision has been
taken purely on public interest, the court
ordinarily should exercise judicial restraint.

7.8.3 In the case of Michigan
Rubber (India) Limited Vs. State of
Karnataka, (2012) 8 SCC 216, after
considering various other decisions of this
Court on the point, more particularly, after
considering the decisions in the case of
Jagdish
Mandal
(supra)
and
Tejas
Constructions and Infrastructure (P) Ltd.
(supra), in paras 23 and 24, this Court has
observed and held as under:

"23.
From
the
above
decisions, the following principles emerge:

(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 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 is
proved to be arbitrary or unreasonable. If the
Government acts 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 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 resources to successfully
execute the work; and