A bench of Justices Hemant Gupta and V Ramasubramanian said that courts do not have the expertise to examine the terms and conditions of the present day economic activities of the State and this limitation should be kept in view when dealing with cases arising from such contracts/ tenders.
It should, therefore, not pass interim orders in such matters which could derail services and projects which are meant for larger public good, the Bench emphasised.
“A word of caution ought to be mentioned herein that any contract of public service should not be interfered with lightly and in any case, there should not be any interim order derailing the entire process of the services meant for larger public good,” the Court held.
Injunctions or interference by High Courts in tenders is against public interest and such interference leads to additional costs on the State, the Court added.
“Courts should be even more reluctant in interfering with contracts involving technical issues as there is a requirement of the necessary expertise to adjudicate upon such issues. The approach of the Court should be not to find fault with magnifying glass in its hands, rather the Court should examine as to whether the decision-making process is after complying with the procedure contemplated by the tender conditions,” the judgment said.
Even if the Court finds that there is total arbitrariness or that the tender has been granted in a malafide manner, still the Court should refrain from interference but instead relegate the parties to seek damages for the wrongful exclusion rather than to injunct the execution of the contract.
“The injunction or interference in the tender leads to additional costs on the State and is also against public interest. Therefore, the State and its citizens suffer twice, firstly by paying escalation costs and secondly, by being deprived of the infrastructure for which the present-day Governments are expected to work,” the Bench said.
Source: Barandbench
