The Supreme Court has said the judiciary should not use a magnifying glass while scanning the tenders and make every small mistake appear like a big blunder.
“In fact, the courts must give fair play in the joints to the government and public sector undertakings in matters of contract. Courts must also not interfere where such interference will cause unnecessary loss to the public exchequer... The courts should not use a magnifying glass while scanning the tenders and make every small mistake appear like a big blunder,” a three-judge Bench of Chief Justice of India D.Y. Chandrachud, and Justices P.S. Narasimha and J.B. Pardiwala observed in a recent judgment.
Justice Pardiwala, who wrote the judgment, reminded judges about their limitations in technical know-how.
“The courts must realise their limitations and the havoc which needless interference in commercial matters can cause. In contracts involving technical issues, the courts should be even more reluctant because most of us in judges’ robes do not have the necessary expertise to adjudicate upon technical issues beyond our domain,” the judgment said.
Electric buses
The verdict came while dismissing an appeal filed by Tata Motors Limited against the Brihan Mumbai Electric Supply and Transport (BEST) Undertaking concerning the tender issued in 2022 for the supply, operation and maintenance of 1,400 single decker air-conditioned electric buses with driver for the purpose of public transport service within the city of Mumbai along with other civil infrastructure development at the BEST depots for a period of 12 years.
“We set aside that part of the judgment and order passed by the Bombay High Court by which the decision of BEST to accept the tender of EVEY [another contender in the tender] was set aside and it was left to the discretion of BEST to undertake a fresh tender process… To set at naught the entire tender process at the stage when the contract is well under way would not be in public interest. Initiating a fresh tender process at this stage may consume a lot of time and also loss to the public exchequer to the tune of crores of rupees,” the court held.
Justice Pardiwala observed that a court ought to intervene only when there was a “clear-cut” case of “arbitrariness, irrationality, mala fides and bias” in a tender or contract process. Judges should exercise a lot of restraint while exercising their powers of judicial review in contractual or commercial matters, the judgment cautioned.
“One must remember that today many public sector undertakings compete with the private industry… the courts must realise their limitations and the havoc which needless interference in commercial matters can cause,” the judgment underscored.
