B. K. MEHTA, G. T. NANAVATI, J. ( 1 ) BY our order to 3/05/1985 we have allowed the petition and issued the writs and directions as specified in the said order the reasons for which we have reserved for being pronounced subsequently. Accordingly we pronounce the reasons in support to the said order. ( 2 ) WHAT is the extent to the power to judicial review to the administrative action in the matter to prequalification to the prospective bidders to the Controlling Authority constituted under the Award to Inter State River Dispute Tribunal and the consequent decision to such authority disqualifying the petitioners for being entitled to receive tender documents are the two moot questions arising in this petition. The questions arise on the facts and in the circumstances briefly narrated as under. ( 3 ) IN response to the separate invitations issued by the State Government in April 1983 to prequalify the prospective bidders for (1) construction to concrete dam across Narmada river and (2) excavation and tunneling and other civil works for the Underground River Bed Power House and appurtenant works for the Sardar Sarovar (Narmada) Project in Gujarat (hereinafter briefly referred to as the dam construction and the power house construction respectively) the first and second petitioner Companies submitted their prequalification information and documents for the aforesaid two works on 12/08/1983 and 31/10/1983 respectively as agreed by and between them in their joint venture agreement to 2/08/1983 Admittedly the joint venture consortia applicant was entitled to make application for prequalification for those works. The eligibility criteria for the prequalification to the prospective bidders for dam construction was inter alias that the applicant must be well established contractor with experience and capability in dam and similar construction and must have placed 25000 cubic metres cement concrete per month and must have had in any one year during last five years turn over of the value to Rs. 400 million in construction. Similarly. the eligibility criteria prescribed for the power house construction was that the applicant must he an established contractor with experience in underground excavation and general civil engineering works and must have done underground excavation to atleast 1000 cubic metres per month in rock mass and annual turn over to the value to Rs. 50 million in any one year during the last five years. 50 million in any one year during the last five years. The information was to be furnished the prospective bidders in different proformas as appended to the prequalification information. Form A required particulars to the organisational structure to the applicant. Form B pertained to the financial details to the applicant. Form C pertained to the particulars to joint venture. Form D related to the details to personnel resources. Form E related to the details to equipment to plant and machinery with the applicant. Form F related to experience while Form G. was for additional information which a particular applicant might desire to furnish. According to the petitioners the first petitioner Company is a professionally managed company with stable financial resources and having highly skilled engineering manpower and modern equipments with a large experience as a prime and subcontractors in India in course to their construction activity over a period to last 25 years. Besides India the first Petitioner Company has executed prestigious and difficult works in Iraq Nepal and Sri Lanka. It has executed major harbour projects which are more difficult than construction of dams and tunnels and have specialised itself in foundation for dams rock blasting etc. and have executed types to civil engineering jobs. The first Petitioner Company has made foul major bridges in Iraq over the river Euphrates which included launching to prestressed girders each weighing 240 tonnes. The first Petitioner Company has during five years from 1978 to 1980 alone completed 10 major works in India and abroad involving concrete work ranging from 5000 cubic metres to 25000 cubic metres. in 1982 the first Petitioner Company poured concrete to more then 2 20 0 cubic metres to grade M 250. It has also achieved distinction of executing any type to civil engineering work to construction to highly demanding standards within the time schedule of the tender and accordingly has confidence to complete the aforesaid two works within the time that may be stipulated under the tender notice. It has also executed specialised foundation work relating to dams such as diaphragm walls drilling grouuting relief wells etc. though they had no direct experience in the construction to dam as such. It has also executed specialised foundation work relating to dams such as diaphragm walls drilling grouuting relief wells etc. though they had no direct experience in the construction to dam as such. The first Petitioner Company had executed a soft ground tunnel in Calcutta as also a vertical shaft in the sea at Kalpakkam though they did not have any direct experience in ordinary tunnel and dam construction as such. ( 4 ) THE Second Petitioner Company has more then 37 years to civil engineering and architectural work experience. It is considered to be one to the leading contractors in dam construction in Japan and by their efforts and experience have developed technical. administrative and financial capability and have thus acquired a strong reputation especially in the construction to dam and power houses. In fact the second Petitioner Company is a top most dam builders in Japan and have performed contracts worth more then Rs. 3400 millions in the aggregate for construction to dams tunnels etc. The second Petitioner Company has recently completed in Indonesia the Singuragura Intake dam and Headrace tunnel for the Asahan Hydro Electric Power Project in North Sumatra. The second Petitioner Company is therefore on merits fully experienced and qualified according to the prescribed qualifications for the aforesaid works to undertake the task to constructing the concrete dam as well as power house. ( 5 ) THE first and the second Petitioner Companies therefore decided to form joint venture with a view to submit their tender for the aforesaid two works and accordingly executed agreements on 22/08/1983 and 1/11/1983 in that behalf respectively. The Petitioners in pursuance to these agreements submitted necessary information and documents for prequalifying them as bidders for the aforesaid two works under the cover to their letters dated 12/08/1983 and 31/10/1983 Since there was no response from the State Government to their applications. the first Petitioner Company on learning that some other parties have been preualified requested the State Govt. by their telegram to 14/01/1985 and confirmatory letter to even date to advice them by a telex message that the petitioners were also prequalified The firs petitioner Company again sent another telegram seeking advice on their pre qualification in respect to the power house. by their telegram to 14/01/1985 and confirmatory letter to even date to advice them by a telex message that the petitioners were also prequalified The firs petitioner Company again sent another telegram seeking advice on their pre qualification in respect to the power house. The State Government failed to respond to this request with the result that the petitioners have moved this Court for appropriate writs orders and directions for setting aside the refusal to prequalify and enjoining the Government to grant prequalification and also to furnish them with tender documents. ( 6 ) AFTER the petitioners filed the petition in this Court on 25/01/1985 they received on 29/01/1985 a letter dated 24/01/1985 from the State Government advising the petitioners that it had not been possible for the State Government to prequalify them for the power house construction. A similar letter to 23/01/1985 was received by the petitioners on 28/01/1985 in respect of the dam construction. The Petitioners claim that their joint venture consortia was fully qualified according to the prescribed criteria to the State Government. Since they were to execute the work jointly under the joint venture agreements between them they have been disqualified on the grounds which were irrelevant and extraneous and without considering the relevant information furnished. The Petitioners claim that their joint venture consortia was fully qualified according to the prescribed criteria to the State Government. Since they were to execute the work jointly under the joint venture agreements between them they have been disqualified on the grounds which were irrelevant and extraneous and without considering the relevant information furnished. or in any case without calling for further particulars in that behalf and the decision to the State Government refusing to prequalify them was arbitrary and vitiated by legal mala fides and therefore bad in law and void6 The State Government resisted the petition on the ground that the impugned decision was by the Sardar Sarovar Construction Advisory Committee (hereinafter referred to as the Advisory Committee) which was a high power committee set up according to the directions under the award to the Narmada Water Dispute Tribunal by the Government to India vide its Resolution to 4/09/1980 after detailed scrutiny and evaluation of 29 applications for darn and 39 applications for power house construction in strict conformity with the guidelines issued by the World Bank which has agreed to finance the Narmada Project in the matter to prequalification to the prospective bidders likely to respond to the invitation to the global tender for the execution to the Project and which decision was considered by the World Bank and therefore the Petitioners are not entitled to challenge purely administrative decision unless they can establish that the decision is highly arbitrary and therefore perverse since factual mala fides are attributed to the Committee or to the Narmada Controlling Authority. ( 7 ) IT is in this back drop that we have to consider as to whether the petitioners are entitled to any or all to the reliefs. ( 8 ) THREE principal questions arise. Firstly what is the extent to the power to judicial scrutiny to such a purely administrative actions particularly in the context to the execution to such a huge project involving a staggering cost to about Rs. 4700 crores and the execution to which is fraught with highly complicated technical and engineering questions the failure to providing adequate solutions to which may result into a very serious and unmanageable disas ter having far reaching repercussions not only on the economy to the State but also on the safety to the people in the vicinity and command to the dam area. The second question which consequently arises is: whether the recommenda tion to the Advisory Committee as approved by the World Bank and the consequent decision to the State Government refusing to prequalify the peti tioners is bad in law void and therefore liable to be quashed and set aside. Thirdly whether this Court would be justified in granting a writ of Manda mus enjoining the State Government to furnish the petitioners with the tender documents and if so in what terms. ( 9 ) BEFORE we take up these questions for our consideration it is necessary to set out briefly as to the different authorities which have been set up under the award of the Narmada Water Dispute Tribunal appointed by the Central Government in this behalf and their powers and duties and also to recapitulate the procedure to prequalifying the prospective bidders as laid down by these authorities and the ground for refusing to prequalify the petitioners for the aforesaid two works. ( 10 ) THE Narmada Water Dispute Tribunal was appointed in October 1969 by the Central Government under the Inter State Disputes Act 1956 which submitted its final report to the Government to India in December 1979 The Tribunal in its final order has inter alia directed setting up to an Inter State Administrative Authority to be called the Narmada Control Authority for the purposes to securing compliance with land implementation to the deci sion to the Tribunal. The Tribunal had also directed to set up a Review Com mittee which on application by any party State may review any decision to the authority. Since four States viz. Gujarat Maharashtra Madhya Pradesh and Rajasthan have financial commitments in respect to Unit1 Dam and appurtenant works to Sardar Sarovar Project and three to them except Rajasthan have such commitments in respect to Unit3 Power Complex of the Project the Tribunal had thought it desirable and necessary that a Con struction Advisory Committee should be constituted for enjoining efficient eco nomic and earlier execution to the said Units 1 and 3 to the Project. Accordingly the Advisory Committee was appointed consisting to: (vide: Resolution to Govt. to India to 4th Sept. Accordingly the Advisory Committee was appointed consisting to: (vide: Resolution to Govt. to India to 4th Sept. 80)1 Secretary in Irrigation Department to the Government to India; 2 Chairman or a representative to the Central Water Commission; 3 Chairman or representative to the Central Electricity Authority; 4 Chairman or representative to the Narmada Control Authority; 5 Joint Secretary Finance and Irrigation Ministry; 6 Finance Secretaries to the four State Governments: 7 Irrigation Secretaries to Gujarat and Rajasthan; 8 Secertaries in Power Department to Madhya Pradesh Maharashtra and Gujarat; 9 Revenue Secretaries to Madhya Pradesh Maharashtra and Gujarat; 10 Chief Engineers to Madhya Pradesh Maharashtra and Rajasthan with Project; ( 11 ) CHAIRMEN State Electricity Board to Madhya Pradesh Maharashtra and Gujarat;12 Financial Advisor to the Project; and 13 One Secretary to be appointed by the Government to India. 14 Similarly by another notification to 10/09/1980 the Gov ernment to India appointed Narmada Control Authority and specified the status and constitution to the said Authority. The Advisory Committee has been empowered by a resolution to 4/09/1980 to frame rules regarding procedure. and delegation to powers for purposes to carrying on its business. In exercise to this power the Advisory Committee framed rules known as Conduct to Business and Procedure Rules 1481 By Rule 12 to the said Rules the Advisory Committee is authorised at its discretion to set up one or more subcommittees for dealing with specific issues and such committees may be empowered as the Advisory Committee may think fit and proper. Since the World Bank was to finance the Project. it held several discussions with the officers to the Government to India and the State Governments concerned. Several appraisal missions visited the site to the Project before agreeing to finance and/or to give loans to meet part to the cost of Project. One to the conditions on which such grants could be sanctioned was that the State Government would follow the procedure prescribed and the guidelines issued by the World Bank for the grant to contracts to carry out the work of the Projects. The guidelines prescribed international competitive bidding for each such work costing more then Rs. 7 crores. The following three conditions generally guide the Banks requirements:1 Need for economy and efficiency in execution to the project and procurement to the goods. The guidelines prescribed international competitive bidding for each such work costing more then Rs. 7 crores. The following three conditions generally guide the Banks requirements:1 Need for economy and efficiency in execution to the project and procurement to the goods. 2 All eligible bidders from developing and developed countries must have an opportunity to compete for the execution to the works or supply to goods. 3 Encouragement and development to local contractors and manufacturers in borrowing materials. The World Bank therefore insisted that these three conditions could be best secured by the international competitive bidding. The State Government was. therefore required to adopt international competitive bidding and afforded all eligible prospective bidders the necessary information in respect to the works and the expectation to the authorities executing the Project the need to qualified bidders. The guidelines to the World Bank. therefore required prequalification for large and complex works so as to ensure in advance of bidding that invitations to kid are extended only to those who are capable. The borrower is thus required to inform the Bank in detail the procedure fol lowed for prequalification and if the Bank suggests any modification to accept the same. The borrower has to forward the list to parties seeking prequalification together with the statement to their qualifications and the reasons for exclusion to any applicant for the comment to the Bank before the applicants are notified to the borrowers decision which is subject to any addition deletion or modification to the list as the Bank may suggest. The World Bank has also suggested to the State Government to frame rules for evaluating pre qualification and also to establish a Committee to analyse the prequalification applications promptly and well before the prequalification period terminates. Accordingly the State Government has formulated rules as approved by the Chairman to the Advisory Committee on 10/09/1983 According to rule 12 to the Conduct to Business and Procedure Rules 1981 the Advisory Committee constituted a subgroup known as Permanent Standing Committee (hereinafter referred to as the Standing Committee) and delegated certain functions to the said Committee which included inter alia the examination to and recommendation to the Advisory Committee on tenders for Project works costing more then Rs. 20 crores each. 20 crores each. The Standing Committee consists of :1 Chairman to the Control Authority; 2 Member (Planning and Project) Central Water Commission; 3 Member (Hydro) Central Electrical Authority; 4 Financial Advisor to the Project; and 5 Secretary to the Advisory Committee the Applications to the parties together with the information and documents furnished by them in respect to prequalification are screened and valuated by the Standing Committee and its report? on detailed evaluation to the applications who fulfil the prescribed criteria and whose applications are res ponsive and names to those who failed to prequalify and the reasons for refusing to prequalify is submitted before the Advisory Committee The Advisory Committee is to scrutinise the report to the Standing Committee and examine the particulars and documents furnished by each to the applicants and to decide as to whether the report to the Standing Committee should or should not he accepted The Advisory Committee in its tun forwards its recommendation about the acceptance to the report to the Standing Committee to the World Bank for no objection. After the World Bank intimates to the Government to India that it has no objection to the recommendation the latter in its turn communicates decision to the World Bank to the State Gov ernment. ( 12 ) THE Government to Gujarat invited applications in the prescribed form for prequalification by the Narmada Project Authority by International Competitive Bidding Prequalification Notice No 1/83 from intending bidders for the dam construction This notice was published in the various daily news papers in the periodical known as World Bank Development Forum and International Trade Magazines. It was also furnished to the embassies to foreign countries who are members to the World Bank and to Taiwan and Switzerland By the said notice it was intimated to the persons concerned that prequalification documents along with the technical note giving brief des cription to the work to be executed and model tender provisions would be made available from 20/04/1983 onwards from the office specified therein and the last date for submitting such applications was prescribed as 22/08/1983 ( 13 ) IN pursuance to the above prequalification notice 29 applications were received from the interested parties by the last date specified including the petitioners. The opening to the prequalification applications for dam con struction was 12/09/1983 before the Standing Committee The said Committee held as many as eight meetings during the period October 198 3/02/1984 at Gandhinagar New Delhi and Baroda The applications were scrutinised to verify as to whether the applicants had satisfied the pres cribed criteria to placing atleast 25 M/3 cement concrete per month on dam or similar works and whether the applicants had in one to the last five years annual turn over to Rs. 400 million in construction Besides this twin test the Standing Committee scrutinised the application by the joint venture consortia as to whether the lead firm had been identified; the consortia had practical and workable arrangements amongst the parties; whether clear arrangement had been made regarding the responsibility to execution and financial arrangement and whether the respective parties were competent to discharge the responsibi Iities so assigned and whether the lead firm had the necessary skill and capacity to lead. After detailed scrutiny it was ascertained that 14 applicants would prequalify whose names were specified in the report to the Committee. So far as the petitioners were concerned. the conclusion to the Standing Committee for not prequalifying them was to the effect that the application was not responsive and the first Petitioner Company had admittedly no expe rience on dam construction. This report to the Standing Committee was placed before the Advisory Committee on 10/04/1984 The report was scrutinised and the original documents examined and it was decided to accept the recommendation to the Standing Committee prequalifying 14 applicants out to 29. The Chairman to the Advisory Committee required the members to scrutinies the applications to the parties who were not recommended for pre qualification by referring to their original documents and on review and detailed deliberation the Advisory Committee unanimously approved the recommenda tion to the Standing Committee not to prequalify 15 of the applicants. These recommendations to the Advisory Committee were forwarded to the World Bank in July 1984 The officers to the World Bank visited India in September 1984 and scrutinised the original documents. On 14/12/1984 the World Bank communicated to the Government to India their no objection to the recommendation made by the Advisory Committee on prequalification and the Government to India in turn communicated the said decision to the World Bank to respondent No. 1. On 14/12/1984 the World Bank communicated to the Government to India their no objection to the recommendation made by the Advisory Committee on prequalification and the Government to India in turn communicated the said decision to the World Bank to respondent No. 1. ( 14 ) SIMILARLY by International Competitive Bidding Prequalification Notice No. 2/83 applications were invited for prequalification from the prospective bidders for Power House Construction. The last date for receipt to the appli cations was specified as 17/11/1983 which was again extended upto 22/12/1983 In response to this notice 39 applications were received by 22/12/1983 The applications were opened on 11/01/1984 before the Standing Committee which scrutinised the applications in two meetings held on April 11 and April 26 1984 The Standing Committee found 19 firms as prequalified. So far as the petitioners were concerned their applications were also rejected for power house construction broadly on the ground that their application was not responsive and the first petitioner had no experience to underground work. This report was placed before the Advisory Committee on 14/06/1984 and the Advisory Committee on scrutiny accepted the recommendation to the Standing Committee in respect to the 19 applications and also decided to add one more name to the said list to pre qualified prospective bidders. These recommendations were forwarded to the World Bank in July 1984 After the personal scrutiny by the officers to the World Bank in September 1984 as stated above no ejection was communi cated by the Bank on 14/12/1984 to the Government to India which in its turn intimated it to the State Government. 14 The main contention urged on behalf to the petitioners was that the decision of the State Government refusing to prequalify the petitioners both in respect of the dam as well as power house construction is bad in law and void and therefore. liable be quashed and set aside. Five subsidiary contentions have been urged in support to this broad contention. Firstly it was urged that the respondents have failed to apply their mind to the correct criteria to be adopted in deciding the question to prequalification. liable be quashed and set aside. Five subsidiary contentions have been urged in support to this broad contention. Firstly it was urged that the respondents have failed to apply their mind to the correct criteria to be adopted in deciding the question to prequalification. Secondly it was urged that the Advisory Committee in so far as it accepted that the petitioners were rightly refused prequalification it acted beyond the prescribed criteria to pequalification in spite to clear directions to the World Bank otherwise and therefore the decision to the State Government in accepting the same is vitiated. Thirdly it was contended that the respondents have failed to appre ciate in correct legal perspective the responsibility to the partners in a joint venture which was recognised as a legal entity to make an application under the information and instruction to the application seeking prequalification. Fourthly the decision refusing to prequalify the petitioners was based on grounds which are neither legal nor valid and therefore was one which no reasonable person could have reached on the facts and in the circumstances to the case. Fifthly the decision to the respondents refusing to prequalify the petitioners was con trary to public interest. ( 15 ) ON behalf to the respondents these contentions were sought to be repelled by urging that the Advisory Committee was only a recommending body and the final approval was by the World Bank and inasmuch as the applications have been screened and subjected to scrutiny by the Committee consisting to highly qualified technical experts and the senior secretaries to the Union and the State Governments and also reexamined by the Advisory Committee and reviewed by the World Bank it cannot be successfully urged that the decision was arbitrary and illegal and if after detailed scrutiny at three different levels the petitioners were found to be not prequalified inasmuch as their applications were not responsive and one to the two partners to the joint ventue consortia was admittedly without requisite experience for the dam construction or the underground power house this Court should not interfere with such a deci sion particularly because the jurisdiction to the High Court to interfere in such purely administrative decision is peripheral in the sense that it can subject it to judicial scrutiny only when it finds that the decision is so perverse that no reasonable person could have reached it. On these contentions broadly three questions arise. ( 16 ) FIRSTLY what is the extent to the power to judicial scrutiny to a purely executive decision in the matter to prequalification of the prospective bidders who may respond to the invitation to tender their offers for entering into engineering contracts particularly where the State Government has an absolute discretion to reject the applications for prequalification without assign ing any reason. Secondly whether the State Government has in reaching the impugned decision erred on the matter to principle so as to warrant the inter ference by this Court. Thirdly what would be the appropriate relief that should be granted if the impugned decision was so vitiated. ( 17 ) IT is well established on principle and authority in the administrative law that an executive authority must be rigorously held to the standards by which it professes its action to be judged and it must scrupulously observe those standards on pain to invalidation to an act in violation to them (see: Ramana v. The International Airport Authority AIR 1979 SC 1628 ; A. S. Ahluwalia v. State of Punjab AIR 1975 SC 984 and Sukhdev v. Bhagatram AIR 1975 SC 1331 ). This rule does not rest merely on Article 14 to the Constitution though it can be said to be an adjunct to it. It is clear however that the rule has an independent existence apart from Article 14 and it has been evolved judicially to check the exercise to arbitrary power by the executive authority. The Supreme Court in International Airport Authoritys case (supra) speaking through Bhagwati J. observed that there is no logic in hesitating to adopt this rule as a part to over expanding administrative law in the country particularly because to the tremendous expansion to welfare and special service and powers and functions to the State even in the field to com mercial activities. The Supreme Court approved the following observation to Mathew J. in V. Punnan Thomas v. State of Kerala AIR 1969 Kerala 81 which was a full bench decision where the Court made the following pertinent observation:"the Government is not and should not be as free as an individual in selecting the recipients for its largess. Whatever its activity the Government is still the Government and will be subject to restrains inherent in its position in a democratic society. Whatever its activity the Government is still the Government and will be subject to restrains inherent in its position in a democratic society. A democratic Government cannot lay down arbitrary and capricious stan dards for the choice of persons with whom alone it will deal. (emphasis supplied)" the Supreme Court referred approvingly to its earlier decision in Erusion Equipment and Chemicals Ltd. v. State of West Bengal AIR 1975 SC 266 where the Court to the context to blacklisting to a party without giving him an opportunity to be heard ruled speaking through Ray C. J. (as he then was) that the Government is not like a private individual who can pick and choose the person with them it will deal and it cannot without adequate reason exclude any person from dealing with it when it was to enter into commercial contracts. It was clarified in that decision that the State need not enter into any contract with any one but if it is so it must do so fairly without dis crimination and without unfair procedure. Bhagwati J. thereafter summed up the legal position in the following terms:"12 must therefore be taken to be the law that where the Government is dealing with the public whether by way to giving jobs or entering into contracts or issuing quotas or licences or granting other forms to largess the government cannot act arbitrarily at its sweet will and like a private individual deal with any person it pleases but its action must be in conformity with standard or norm which is not arbitrary irrational or irrelevant The power or discretion to the Gov ernment in the matter to grant to largess including award to jobs contracts quotas licences etc. muse be confined and structured by rational relevant and nondiscri minatory standard or norm and if the Government departs from such standard or norm in any particulars case or cases the action to the Government would be liable to be stuck down unless it can be shown by the Government that the departure was not arbitrary but based on some valid principle which in itself was not irrational unreasonable or discriminatory. (Emphasis supplied)" ( 18 ) IT is exiomatic to say that Article 14 strikes at the arbitrariness in State action and fairness and equality to treatment is implicit in the rule to law. (Emphasis supplied)" ( 18 ) IT is exiomatic to say that Article 14 strikes at the arbitrariness in State action and fairness and equality to treatment is implicit in the rule to law. The rule postulates that the State action must not be arbitrary and founded on some rational and relevant principle which should not be discri minatory. The state should not allow itself to be guided by extraneous or irrelevant consideration since that would itself amount to denial to equality. The Supreme Court ruled in International Airport Authoritys case (supra) that the principle of reasonableness and rationality which is legally as well as philosophically an essential element of equality or nonarbitrariness is projected by Article 14 and it must characterise every State action whether it be under authority to law or in exercise of executive power without making to law. The State cannot therefore act arbitrarily in entering into relationship contractual or otherwise with a third party but its action must conform to some standard or norm which is rational and nondiscriminatory (see also Erusian Equipment and Chemicals Ltds case supra ). ( 19 ) WHAT is the standard to reasonableness to which the State action must conform is a moot question. The principle that State must exercise its powers reasonably has to be reconciled with no less an important doctrine that the Court must not usurp the discretion invested in the public authority. A public authority invested with the discretion to take decision has genuinely free dis cretion within the bounds to legal reasonableness. The courts should shun the temptation to delineate these boundaries too rigidly. The approach to the Court must be to adopt and apply an objective standard which may leave to the deciding authority the full range to choices which the Legislature is pre sumed to have intended. The decision cannot be capricious or according to the humour to the authority and if it confines itself within the bounds to legal reasonableness the Court is precluded from looking further into the merits of such decision. Broadly expressed the decision is unlawful if it is one to which no reasonable authority could have come (see: Wade on Administrative Law Fifth Edition pages 362363 ). The classical formula adopted by Lord Greene M. R. which has become known as Wednesbury principle in Associated Provincial Picutce Houses Ltd. v. Wednesbury Corporation (1948) 1 K. B. 223. is illustrative. Broadly expressed the decision is unlawful if it is one to which no reasonable authority could have come (see: Wade on Administrative Law Fifth Edition pages 362363 ). The classical formula adopted by Lord Greene M. R. which has become known as Wednesbury principle in Associated Provincial Picutce Houses Ltd. v. Wednesbury Corporation (1948) 1 K. B. 223. is illustrative. which is in the following terms:"it is true that discretion must be exercised reasonably. Now what does that mean? Lawyers familiar with the phraseology used in relation to exercise to statutory discretions often use the word unreasonable in a rather comprehensive sense. It has frequently been used and is frequently used as a general description to the things that must not be done. For instance a person entrusted with a discreion must so to speak direct himself properly in law. He must call on his own attention to the matters which he is bound to consider. He must exclude from his consideration matters which are irrelevant to what he has to consider. If he does not obey these rules he may truly be said and often is said to be acting unreasonably;. Similarly there may be something so absurd that no sensible person could ever dream that It lay within the powers to the authority. Warrington L. J. Short v. Poola Corporation (1926) Ch. 66 gave the example of the redharted teacher. dismissed because she had red hair. This is unreasonable in one sense. In another it is taking into consideration extraneous matters. It is so unreasonable that it might almost he described as being done in had faith and. in fact. ail these things run into one another. (Emphasis supplied)" ( 20 ) WADE in his Administrative Law Fifth Edition at P. 365 observes as under:"i he expression arbitrary and capricious is sometimes used as a synonym for unreasonable: and in one ease this has been transmuted into frivolous or vexatious and capricious and vexatious. But the meaning to all such expressions is neces sarily the same since the true question must always be whether the statutory power has been exceeded. . ( 21 ) AT page 364 the principle has been digested as under:". . But the meaning to all such expressions is neces sarily the same since the true question must always be whether the statutory power has been exceeded. . ( 21 ) AT page 364 the principle has been digested as under:". . UNREASONABLENESS is a generalised rubric covering not only sheer absurdity or caprice but also illegitimated motives and purposes a wide category of errors com monly described as irrelevant considerations and mistakes and misunderstandings which can be classed as selfmisdirection or addressing oneself to the wrong question ". ( 22 ) AT page 355 in the same treatise to Administrative Law it has been observed that the notion to absolute or unfettered discretion is rejected since a system based on rule to law unfettered Governmental discretion is a contra diction in terms. Unfettered discretion is wholly inappropriate to a public authority which possesses power for the public good. Unreviewable adminis trative action is just as much a contradiction in terms as is unfettered discretion at any rate in the case to statutory powers. Lord Denning M. R in Breen v. Amalgamated Engineering Union (1971) 2 Q. B. 175 observed as under :"the discretion to a statutory body is never unfettered. It is a discretion which is to be exercised according to law. That means at least this: the statutory body must be guided by relevant considerations and not be irrelevant. If its decision is influenced by extraneous considerations which it ought not to have taken into account then the decision cannot stand. No matter that the statutory body may have acted in good faith: nevertheless the decision with be set aside. That is established by Padfield v. Minister to Agriculture Fisheries and Food which is a landmark in modern administrative law (Emphasis supplied)" ( 23 ) WE do not think that it can be urged successfully that these principles hold good only qua statutory discretionary powers. The following observation to Wade on Administrative Law 5 Edition at page 360 clearly fortifies the above view :". . . . IT shows that statutory implication is not the indispensable basis to the principle that the discretion to public authorities is never unfettered. Its real basis is that nothing else is compatible with a proper system to administrative law". The following observation to Wade on Administrative Law 5 Edition at page 360 clearly fortifies the above view :". . . . IT shows that statutory implication is not the indispensable basis to the principle that the discretion to public authorities is never unfettered. Its real basis is that nothing else is compatible with a proper system to administrative law". ( 24 ) A faint attempt was made on behalf to the State Government to urge that the principles governing the power to judicial review to statutory discretionery decision cannot be extended wholly while examining the question to alleged abuse to wide discretionary power vested in the executive body. We do not think that the executive discretionary powers are legally absolute and totally immuned from judicial review. The following observation from De Smith s Judicial Review to Administrative Action 4 Edition at p. 289 is very in structive:". . . The absence to a statutory power should not in itself be a conclusive reason for a refusal by the courts to entertain proceedings in which it was alleged for example that a contractor had been removed without a hearing from a list to approved government contractors because the Minister believed that the contractor had breached the terms to the Governments incomes policy or that companies were excluded from submitting tenders on the basis to manifestly arbitrary considerations. (Emphasis supplied)" ( 25 ) WE do not think that the above contention urged by the learned Advocate General on behalf to the State can be sustained particularly in view to the clear exposition to law by the Supreme Court in International Airport Authoritys case (supra) that the principle to reasonableness and rationality must characterise every State action whether it be under authority of law or in exercise to the executive power without making to law. ( 26 ) HECHTIEF Gammon v. State of Orissa and ors. AIR 1975 S. C. 2226 the supreme Court after referring to the earlier relevant decisions in this connection and also the decision to the House of Lords in Padfield v. Minister of Agriculture Fisheries and Food (1968 AC 997) summed up the legal position as under in paragraph 13 at page 2234 :"13 The Executive have to reach their decisions by taking into account relevant considerations. They should not refuse to consider relevant matter nor should take into account wholly irrelevant or extraneous consideration. They should not refuse to consider relevant matter nor should take into account wholly irrelevant or extraneous consideration. They should not misdirect themselves on a point to law. Only such a decision will be lawful. The courts have power to see that the Executive acts lawfully. It is no answer to the Exercise of that power to say that the executive acted bona fide nor that they have bestowed painstaking consideration. They cannot avoid scrutiny by courts by failing to give reasons. If they give any reasons they are not good reasons the Court can direct them to reconsider the matter in the light to relevant matters though the property. adequacy or satisfactory character to those reasons may not be open to judicial scrutiny. Even if the Executive considers it inexpedient to exercise their powers they should state their reasons and there must be material to show that they have considered all the relevant facts". ( 27 ) IN CIT Bombay v. Mahindra and Mahindra Ltd. AIR 1984 S. C. 1182 the Supreme Court in the context to the validity to the order to the Central Government accepting the recommendation to the specified authority refusing to issue declaration under section 72a to the Income tax Act 1961 to the respondent Company speaking through Tulzapurkar J. summed up the legal position about the power to the judicial scrutiny to such a decision in the following terms in paragraph 11:" By now the parameters to the Courts power to judicial review to administrative or executive action or decision and the grounds on which the Court can interfere with the same are well settled and it would be redundant to recapitulate the whole catena to decisions to this Could commencing from Barium Chemicals 1966 Supp SCR 311 ( AIR 1967 SC 295 ) case on the point. Indisputably it is a settled position that if the action or decision is perverse or is such that no reasonable body to persons properly informed could come to or has been arrived at by the authority misdirecting itself by adopting a wrong approach or has been influenced by irrelevant or extraneous matters the Court would be justified in interfering with the same. This Court in one to its later decisions in Smt. Shalini Soni v. Union of India (1981) I SCR 962 ( AIR 1981 SC 431 ) has observed thus: It is an unwritten rule of the law. constitutional and administrative that whenever a decision making function is entrusted to the subjective satisfaction of a statutory functionary there is an implicit obligation to apply his mind to pertinent and proximate matters only esehewing the irrelevant and the remote. Suffice it to say that the following passage appearing at pages 285 86 in Prof. de Smiths treatise Judicial Review of Administrative Action (4th Ed.) succinctly summarises the several principles formulated by the Courts in that behalf thus:"the authority in which a discretion is vested can be compelled to exercise that discretion but not to exercise it in any particular manner. In general a discretion must be exercised only by the authority to which it is committed. That authority must genuinely address itself to the matter before it: it must not act under the dictation of another body or disable itself from exercising a discretion in each individual case. In the purported exercise of its discretion it must not do what it has been forbidden to do. nor must it do what it has not been authorised to do. It must act in good faith must have regard to all relevant considerations and must not be swayed by irrelevant considerations must not seek to promote purchase alien to the letter or to the spirit of the legislation that gives it power to act and must not act arbitrarily or oacriciously. Nor where a judgment must be made that certain facts exist can a discretion be validly exercise on the basis of an erroneous assumption about these facts. These several principles can conveniently be grouped in two main categories : failure to exercise a discretion and excess or abuse of discretionary power. The two classes are not however mutually exclusive. Thus. discretion may be improperly fettered because irrelevant considerations have been taken into account: and where an authority hands over its discretion to another body it acts ultra vires. Nor is it possible to differentiate with precision the grounds of invalidly contained within each category. The two classes are not however mutually exclusive. Thus. discretion may be improperly fettered because irrelevant considerations have been taken into account: and where an authority hands over its discretion to another body it acts ultra vires. Nor is it possible to differentiate with precision the grounds of invalidly contained within each category. (emphasis supplied)" ( 28 ) THE principles enunciated in International Airport Authoritys case (supra) were again reiterated by the Supreme Court in M/s. Kasturi Lal v. State of J and K AIR 1980 SC 1982. The Supreme Court. However indicated the basic principle which must guide the court in adjudicating upon the validity of a discretionary executive order. The Supreme Court raised a caution that there may be an infinite variety or considerations which may have to be taken into account by the Government in formulating its policies and it is on a total evaluation of various consideration which have weighed with the Government in taking a particular action. While determining as to whether the governmental action is reasonable and in public interest the first principle which the Court has to bear in mind is that there is always a presumption that the governmental action is reasonable and in public interest and the heavy burden to prove lies on a party challenge such decision for rebutting the presumption by producing proper and adequate material. The second principle which has been emphasised is that the Court must not lightly assume that the impugned action is unreasonable or without public interest. However when it is satisfied that the impunged decision is unreasonable or against public interest. the courts are duty bound under the Constitution to invalidate such action and this duty is the bed rock of rule of law. The third principle which has been indicated is that this ground of the action being unreasonable or without public interest is different from that of mala fides. ( 29 ) IT is in the backdrop of this settled legal position that we have to decide as to whether the impugned decision of the State Government has been vitiated and. if so on what grounds. We will shortly remind ourselves of the five subsidiary contentions urged in support of the attack on the validity of the impugned decision. The question of prequalification is determined on a totally irrelevant consideration and after ignoring the relevant material. if so on what grounds. We will shortly remind ourselves of the five subsidiary contentions urged in support of the attack on the validity of the impugned decision. The question of prequalification is determined on a totally irrelevant consideration and after ignoring the relevant material. The concept of joint venture and the rights and liabilities inter se of such venture have not been properly understood and appreciated. The underlying purpose of the guideline issued by the World Bank is ignored and the whole question has been determined on grounds which were neither legal nor valid with the result that the impunged decision was unreasonable and against the public interest. ( 30 ) IT should be noted at the outset that the basic purpose which generally guides the World Banks requirements when it extends its financial assistance is that of eligible bidders from all developing and developed countries must have an opportunity to compete so that the execution of the project may be efficient and economic and the local contractors may be encouraged. The World Bank therefore required that the agencies obtaining loans from the Bank must frame rules to prescribe procedure for evaluation of the prequalification of the applicants before their applications are opened and taken into consideration. Accordingly the rules were framed by the authorities and approved by the Advisory Committee on 10/09/1983 before the relevant applications were opened on 12/09/1983 The procedure envisages a setting up of a committee to analyse the prequalification documents. Accordingly a Permanent Standing Committee was appointed and entrusted with the task of the scrutiny of the applications in accordance with the procedure for evaluation. The Standing Committee held about eight meetings during the period October 198 3/02/1984 and examined and evaluated the applications of about 29 firms which sought the prequalification for the Dam construction The applications of about four firms which submitted prequalification in formation and documents after the last date were not taken into considerations. The Standing Committee held about eight meetings during the period October 198 3/02/1984 and examined and evaluated the applications of about 29 firms which sought the prequalification for the Dam construction The applications of about four firms which submitted prequalification in formation and documents after the last date were not taken into considerations. One of the very important points which we have to emphasise is that it is an admitted position that the Standing Committee did not find it necessary to ask for clarification and further related information form the applicants but made its evaluation on the basis of the information supplied in various documents furnished alongwith the applications The method of evaluation as approved by the Chairman of the Advisory Committee consists of procedure and rules contained in Parts I and II as detailed in Enclosure I to the report of the scrutiny for prequalification for dam construction Shortly staled the procedure prescribed is as under:1 Any applicant capable of undertaking and completing the whole work within the stipulated time to the satisfaction of the Standing Committee is entitled to prequalify2 An applicant can either be an individual or a proprietary firm a firm in partnership a limited company as a limited Corporation or a orous of firms known as joint venture. 3 (a) In case of joint venture the sponsoring firm has to submit complete information and identify the lead firm. 3 (a) In case of joint venture the sponsoring firm has to submit complete information and identify the lead firm. (b) It has to establish to the satisfaction of the Committee that practicable workable and legally enforceable arrangement is made amongst the parties and there is a clear assignment of the responsibilities regarding the execution and financial arrangement and that individual parties to whom such responsibilities are assigned are capable in their individual capacity to discharge them compatently and satisfactorily and that the lead firm has necessary skill and capacity to lead during the entire period of execution for purposes of the responsibility and the involvement as well as control and direction on the resources of the entire joint venture4 A system awarding points for capability under various heads so as to judge the overall capability and fitness be evolved5 The Committee will have freedom to ask for clarification and further related information from the applicants check resources and make inspection of the prospective tender work ( 31 ) IN order to satisfy this procedure rules have been framed Rules IA IB 4 and 4b are material for our purposes and they are therefore set out in extenso:part II RULES 1 No evaluation will be done if the application is nonresponsive of in the applicant does not fulfil the twin criteria of (a) must have placed at least 25000 cubic metre cement concrete per month and (b) yearly turnover of India Rs. 40 crores or its equivalent in construction in any one of the last 5 years1 If only the applicant is qualified as A above further evaluation with be done as per the norms laid down in Rule 4 below: 1 xx xx 1 xx xx2 xx xx3 xx xx4 If the applicant is a joint Venture the details of the lead firm which will be (a) in charge of the actual execution of the work (b) in charge of the organisation equipment and machinery etc. on etc and (c) in charge of financial dealings as regards all payments including payments for work done claims etc. will be considered for determining the prequalification. 4 Total points: 10v points will be awarded under the following Heads: heads. Total points i. Technical capability 30 ii. Financial capability 10 iii. Organisational capability 30 iv. on etc and (c) in charge of financial dealings as regards all payments including payments for work done claims etc. will be considered for determining the prequalification. 4 Total points: 10v points will be awarded under the following Heads: heads. Total points i. Technical capability 30 ii. Financial capability 10 iii. Organisational capability 30 iv. Experience 25 v. Overall Assessment 5 _______ 100 negative points will be awarded to applicants for certain disabilities and failure like these elaborated in 4b V1 below: x x x x x ( 32 ) IT is not necessary for us to refer to the result of the evaluation of the applicants who had according to the Standing Committee entitled to be prequalified. We may refer to the result of scrutiny of those applicants who failed to prequalify themselves for the work of dam. So far as the petitioners are concerned the result of the scrutiny has been set out at Sr. No. 2 in Annexure V to the report of scrutiny for dam. We may set out in extenso the conclusion of the Committee in respect of the petitioners: ____________________________________________________________________________________ Result of scrutiny of applications which do not prequalify (either non responsive or which do not fulfil the two eligibility criteria or the requirements regarding Joint Venture ). _____________________________________________________________________________________ sr. Sr. No. Name of appellant Conclusion. No. of appli_____________________________________________________________________________________ 1 xx xx The joint venture agreement is silent 2 2 AFCONS MAEDA about division of responsibilities as well J. V. FOR as about the lead firm. In form C how PROJECT over some division of responsibilities has NARMADA been indicated but the lead firm has not been identified AFCONS is nominated as sponsoring firm : the application is therefore to that extent non res ponsive. MAEDA have adequate experience in darn construction but AFCONS have admittedly no experience in dam construction. The enclosure 10 on p. 198 of AFCONS documents shows that the work will be executed by them under guidance and supervision of MAEDA. ( 33 ) THE Standing Committee has recommended for prequalifying 14 applicants out of 29. This report on the scrutiny was placed before the Advisory Committee. It was circulated in advance amongst the members before the first Committee meeting. The report was discussed by the Advisory Committee with reference to the original documents which were tendered by the different applicant firms. This report on the scrutiny was placed before the Advisory Committee. It was circulated in advance amongst the members before the first Committee meeting. The report was discussed by the Advisory Committee with reference to the original documents which were tendered by the different applicant firms. The Advisory Committee reviewed the report of Standing Committee and examined the details of the original documents of 14 applicants who were recommended for prequalification by the Standing Committee. As regards the applicants who have failed to prequalify as per the report of the Standing Committee Advisory Committee had noted in its 13th meeting held at New Delhi on 10/04/1984 that with regard to the applicants who were not recommended for prequalification by the Standing Committee the Chairman of the Sardar Sarovar Construction Advisory Committee (SSCAC in short) suggested that in view of the urgency of completing the bask such cases may be further examined by the members during the meeting itself. Accordingly the members scrutinised all such applications with reference to the original documents. As a result of this review and detailed deliberation the Committee reached its final conclusion which was unanimously approved. The 1st of the applicants who were finally prequalified by the SSCAC: is given in Annexure II. ( 34 ) SIMILARLY for the work of the power house the rules and procedures were formulated and approved by the Chairman of the Advisory Committee on 4/01/1984 The procedure which has been formulated and approved was almost in the same terms as was prescribed for the work of dam construction. The rules framed for implementing this procedure though similar are slightly differently worded. Rules IA and IB read as under:"1 A: No evaluation will be done (i) if the information given in Form C or Annexure A Sr. No. 9 or Annexure B Sr. No. 8a or Form B Item 5 is incomplete and the application is therefore considered nonresponsive or (II) if the applicant does not fulfil the criteria for eligibility laid down In clause 8. 04 and 8. 05 which are reproduced below; 8. 04 The applicant applying for prequalification must provide evidence of having adequate experience in control and modern blasting technique in Under Ground Excavation rock bolling shotcreting and permanent underground support system. 8. 04 and 8. 05 which are reproduced below; 8. 04 The applicant applying for prequalification must provide evidence of having adequate experience in control and modern blasting technique in Under Ground Excavation rock bolling shotcreting and permanent underground support system. 8. 05 To qualify the applicant must have done Underground Excavation with an output of not less than 10 0 cubic meters per month in rock mass. He must have had at least in one of the last five years an yearly turn over of Indian Rs. 50 million or equivalent in construction. 1 if only the applicant is qualified as per A; above further evaluation will be done; as per the norms laid down in Rule 4 below: ( 35 ) RULE 4 comprises of two parts rule 4a and rule 4b they tare in parimateria with rule 4a and 4b adopted for the work of dam construction as set out above. ( 36 ) IN all 39 applicants sought prequalification for the Power House Construction. Three parties submitted information and necessary documents after the last date for submission of the applications for prequalification that is 22/12/1983 and therefore they were not taken into consideration. Annexure V to this report of scrutiny contains appraisal of Joint venture proposals. This appraisal is contained in a tabular form which contains 8 columns. The appraisal of the petitioners as contained in this statement is in the following terms. Name of Whether Whether Whether Whether the Whether the Whether the firms there is an the lead the JV has responsibiindividual lead firm has agreement identified made practi lities regard parties to the necessary firm is sable working execu whom then resskill and capaable and tion and arrange ponsiblity recity to lead legally en ments have garding exe and also the res arrangements been clearly cution and ponsibility and forceable laid down and financial involvement amongst the assigned. arrange for the entire parties. ments are period of exe capable in cution as their indivi well as a dual capacity leading role in to discharge control and them compe direction on tentanly and the resources satisfactorily. of the entire 2 3 4 5 6 7 8 joint venture AFCONS Yes Not mention Yes. arrange for the entire parties. ments are period of exe capable in cution as their indivi well as a dual capacity leading role in to discharge control and them compe direction on tentanly and the resources satisfactorily. of the entire 2 3 4 5 6 7 8 joint venture AFCONS Yes Not mention Yes. Financing Individual AFCONS and MAEDA ed in JV Execution lity not who have agreement Jointly and stated (Form C ) they AFCONS Severally defined will execute mentions itself responsibi the work as lead firm (Clause 6 U. G. Works. in its Form C of J. V. where as MAEDA mentions AFCONS as sponsor. ( 37 ) ANNEXURE VII to this report of scrutiny for Power House Cons truction contains list of applicants who are considered noneligible for further evaluation The common remarks of the Committee it regard of Petitioners Nos. 1 and 2 are given at Sr. No. 5. These remarks are in the following terms"joint venture agreement is defective for the following reasons: (a) Lead firm not identified in agreement. AECONS have stated (in their form C) that they would be the lead firm and would execute the work. MAEDA in their Form C mentions AFCONS as sponsoring firm only. (B) Responsibilities of parties for executing work are not clearly defined. (C) AFCONS who have stated that they would execute the work have no experience of underground works. ( 38 ) THE Standing Committee recommended the names of 20 parties as being qualified while it rejected the cases of about 19 parties on one or the other ground This report of scrutiny of the Standing Committee was placed before the Advisory Committee in its meeting at New Delhi on 14/06/1984 The Advisory committee accepted the report of the scrutiny by the Standing Committee with an addition of the name of one more party as entitled to be prequalified. ( 39 ) AT this stage it is necessary to refer to two telex messages sent by the World Bank Authorities on 16/07/1984 and 6/08/1984 The first telex message of 16/07/1984 is to be found at annexure II to the affidavit in rejoinder of Shri I. M. Shah Secretary to government of I Gujarat in Nar mada Development Department dated 25/03/1985 This message contains the approach which was to be adopted for prequalification of the applicants For dam as well as Power House Construction It has been emphasised by the Worldbank Authorities that the approach of the Committee should be flexible and the applicants who may be suitable should be invited to submit additional information. It has been also pointed out that in the qualification process it is a standard practice that all applicants who may be qualified if some questions are answered be requested to provide clarification and such questions may include the particulars regarding (a) firms part in a Joint Venture or may other technicality. Seeking clarification should not be viewed as giving an undue advantage to one party since it will significantly help to ensure that sui table applicants are not disqualified on the basis of some technicality or mis understanding. In the opinion of the World Bank Authorities it is proper and prudent to qualify a Joint Venture applicant that may need some administra tive revision with the condition that the applicant would make those revisions and provide the required type of Joint Venture in this standard. The world Bank offered the following comments in light of the above preferatory remarks on the recommendation made by the Advisory Committee in respect of the pre qualification of the parties in respect of the Darn and Power House construc tion. The comments are worth repeating in extenso:" (I) The approach in evaluating the applicants was too rigid. (ii) It is very unusual to find that no clarifications or supplementary information were requested from any of the 68 applicants. (iii) There are questions that should be asked of some applicants. (iv) There is good evidence to indicate that there are more applicants capable to doing the work than appear on your tentative list of recommendations". In summary the applicants were treated as if they were tenders and not simply applicants to prequalify to be allowed to tender. (iii) There are questions that should be asked of some applicants. (iv) There is good evidence to indicate that there are more applicants capable to doing the work than appear on your tentative list of recommendations". In summary the applicants were treated as if they were tenders and not simply applicants to prequalify to be allowed to tender. Therefore we strong advise that clarification now to be requested of any applicant on ally application on which there exist any doubts about ability to perform work. These clarifications can be obtained in a matter of days. We recommend that the above exercise be conducted expeditiously with a goal of quality ing all applicants who are capable of performing the taskunder question". (emphasis supplied) ( 40 ) THE next telex message sent by the World Bank is of 6/08/1984 It is also annexed to the aforesaid affidavit and marked Annexure II collec tively. The World Bank Authorities did not think it fit to revise or modify their comments contained in the telex message of 16/07/1984 set put above even after the receipt of the detailed evaluation report from the Advisory Committee. It has been explicitly stated in this telex message of Augus t 6 1984 that even after examining those reports the authorities found no reason to change their recommendation and therefore their position remained as outlined in the telex message of 16/07/1984 The Bank Authorities felt concerned at the signifi cant difference between the level of acceptance for the individual firms which was as high as 68% is compared to the applicants of Joint Venture which was only 16%. The following remarks in this message of 6/08/1984 make an interesting reading:". . . There are some large and capable firms who appear likely to have qualified on their own but before rejected as partners in joint ventures. As is the case for single firms prequalification of joint ventures should be based only on their ability to perform the required work as indicated by their experience personnel equipment and financial status. If joint venture partners are the lowest evaluated bidders you must be satisfied that each firm carried appropriate responsibilities and is commit ted to joint and several responsibility for performance of the contract. For prequali fication purposes however it is not necessary and sometimes not even possible to have full details of joint venture proposals. If joint venture partners are the lowest evaluated bidders you must be satisfied that each firm carried appropriate responsibilities and is commit ted to joint and several responsibility for performance of the contract. For prequali fication purposes however it is not necessary and sometimes not even possible to have full details of joint venture proposals. Therefore joint ventures which In elude one or more firms who are able to perform the world and who indicate they are joint and severally responsible should be prequalified. We suggest you review all those joint ventures that have not been qualified to as whether they meet these criteria and should therefore be prequalified. If there exist any about about the members of the joint ventures ability or commitments clarifications should be requested. It is permissible to prequalify joint ventures on the condition that they will make needed organisational rearrangements or legal commitments by the time they bid in order to strengthen. . . The evaluation Committee should keep in mind that the capability on the qua lified firms will again be subject to their approval when they submit their bids. With respect to both joint ventures and individual applicants some disqualification apparently were a result of impress answers that should five been qualified in capability was in doubt in summary was suggest that those applications that were disqualified be reexalted to ensure that all applicants who have the ability to perform the work are prequalified to bid. Clarifications should be requested if there exist any doubts about in applicants ability to perform the work. Pay special attention to the joint ventures ill which there are clearly capable terms. . . . (emphasis supplied)" . ( 41 ) TWO telex messages had beenreceived thereafter One on 16/12/1984 and another on 26/12/1984 In between somewhere in September 1984 the officers of the World Bank had come to India and exa mined the documents and other related information furnished by the autho rities seeking the qualification and particularly of those parties who according to the recommendations of the Advisory Committee failed to prequality. in telex message of 16/12/1984 is at Annexure VIII to the affidavit in reply dated 521984 of said Shri I. M. Shah. in telex message of 16/12/1984 is at Annexure VIII to the affidavit in reply dated 521984 of said Shri I. M. Shah. By the telex message of Decemher 16 1984 the World Bank Authorities had given noobjection to the recommendations of the Advisory committee on the report of the security for prequalification in respect of the Dam and Power House Construction by the Standing Committee. In other words the recommendation of the Advisory Committee accepting the report of scrutiny of the Standing Committee disqualifying inter alia the petitioners was cleared by the World Bank. The last telex message of 26/12/1984 also males a very interesting reading since this message had been received from the World Bank after it accorded its noobjection to the recommendations of the Advisory Committee in the matter of prequalification. In this last telex message it was conveyed that the World Bank does not object to the recommendation made by the Advisory Committee to prequalify 14 applicants in respect of dam construction and 20 applicants in respect of the Power House Construction. However the next paragraph numbered as BBB (Annexure IV to the affidavit of Shri I. M. Shah dated 25-3-1985) make an interesting reading:"bbb. In light of the need we have indicated to you in the past of a clarification of the definitions of joint venture and domestic preference we recommend that the notification to prequalified applicants of their eligibility alter them to the forthcoming requirement in the bid document that will (A) require joint and several liability for any partner in a joint venture and (B) limit eligibility for domestic preference for joint ventures to those with domestic partners carrying out at least fifty percent of contract value" ( 42 ) WE will deal with the first four subsidiary contentions which we have set out above an support of the attack on the impugned decision of the State Govt. refusing to prequalify the petitioners. It should be recalled that in the prequalification information and instructions issued to the applicants seeking prequalification for Dam as well as Power House Construction joint venture consortia were allowed to apply for the same. Similarly a group of firms was also entitled to seek pre-qualification. In other words therefore the authorities envisaged inter alia that the group of firms and joint consortia are two distinct entities which card seek prequalification. Similarly a group of firms was also entitled to seek pre-qualification. In other words therefore the authorities envisaged inter alia that the group of firms and joint consortia are two distinct entities which card seek prequalification. The eligibility criteria are to be satisfied by the applicants including a group of firms or a joint venture consortia as the case may be. This prequalification information makes the position abundantly clear as to what is the requirement when an applicant group of firms. The printed memorandum containing information issued by the Government of Gujarat in Irrigation Department in this behalf is annexed as Annexure A1 to the petition. The information and instructions require that all informations requested in the enclosed form should be furnished and if any particular query is not relevant it should be a stated as nonapplicable. The prospective applicants were cautioned that giving incomplete information in the application or making any change in the prescribed forms may render the application nonresponsive. The instruction also indicate the method as regards how to apply under para 2 of the Memorandum. In case of the application by a group of firms the instructions provide as under:"2 METHOD OF APPLYING: if the application is made by an individual. . . . If the application is made by a group of firms the sponsoring firm shall submit complete information with regard to all the information required in the forms per taining to each firm in the group and state in covering letter attached to the appli cation as to which of the firms shall have the responsibility for applying for Ten der Submission of Tender and for completion of the contract document and fur nish evidence admissible in law in respect of the authority assigned to such firm or behalf of the group of firms for applying for Tender Submission of Tender and for completion of the contract document. The full information and satisfactory evidence pertaining to the participation and responsibility of each member firm of the group of firms making the application shall be furnished alongwith the pre qualification document duly signed by cash firm. The least firm should be clearly identified and the extent of responsibility or lead and other firms should be defined. (emphasis supplied)" ( 43 ) AS regards Joint Venture the instructions read as under:"joint venture consortia will be allowed to apply for prequalification. The least firm should be clearly identified and the extent of responsibility or lead and other firms should be defined. (emphasis supplied)" ( 43 ) AS regards Joint Venture the instructions read as under:"joint venture consortia will be allowed to apply for prequalification. A prequa lifted firm or joint venture consortia may during tender period strengthen its capacity by the subsequent incorporation of prequalified firm subject to the approval of Government of Gujarat". ( 44 ) THE different forms A to G which have been referred in the facts narrated hereinabove containing requisite particulars to be furnished by the applicants seeking prequalification inter alia relate to joint venture also. The particulars which are to be furnished in form C relating to joint ven ture consist of (1) name and address of joint venture: (2) name and address of all the partners of joint venture; (3) the responsibility be the firm leading the joint venture and the responsibility of the other Joint venture partners; (4) the name of bankers and (5) the financial participation of each firm in the joint venture. Thus it is clear that in case of a group of firms the applicants has to give more particulars which have been set out above namely which firm will be responsible for applying for and submission of tender and for com pletion of the contract document and also the responsibility of the lead firm as well as other memberfirms is to be clearly stated. The affect of the conjoint reading of the Memorandum of instructions and information as well as the forms in which the particulars were to be furnished clearly indicates that the authorities had visualized and envisaged the group of firms as well as the joint venture consortia as different entities which could seek prequalification. It appears from the particulars which are required to be furnished in form C that the authorities envisaged that there may be cases of joint venture consortia where one of the matter firms may have a leading role to pay and the respon sibility of their joint Venture partners may not be so leading and important. It appears from the particulars which are required to be furnished in form C that the authorities envisaged that there may be cases of joint venture consortia where one of the matter firms may have a leading role to pay and the respon sibility of their joint Venture partners may not be so leading and important. It is in respect of such cases that the particulars are to be furnished about the responsibility of the firm leading the joint venture and the responsibility of the other partners thereof the legal concept of the joint venture is very well re cognised and we do not think that the authorities in these High Powered Committee can be oblivious of this recognised legal concept. If they are they have completely misdirected themselves. The common law did not recognise the relationship of coadventures but with the passage of time the judicial de cisions recongnised what is known as joint adventure of two or more persons undertaking to combine their property or labour in conduct of particular line of trade or a general business for joint profits. The Courts do not treat a joint adventure as identical with a partnership though it is so similar in nature and in the contractual relationship created by such adventures that the rights as bet ween them are governed practically by the same rules that govern the partner ship. This relationship has been defined to be a special combination of persons undertaking jointly some specific adventure for profit without any actual part nership. It is also described as a commercial or a maritime enterprise under taken by several persons jointly; a limited partnership not limited in the sta tutory sense as to the liabilities of partners but as to its scope and duration. Generally speaking the distinction between a joint adventure and a partnership is that former relates to a single transaction though it may comprehend a business to be continued over several years while the latter relates to a joint business of a particular kind (see 4b American Law Reports at p. 1055 under the caption what amounts to a joint adventure at pages 105657 and 1060. It is generally agreed that in order to constitute a joint venture there must be community of interest and right to joint control. It is generally agreed that in order to constitute a joint venture there must be community of interest and right to joint control. It is recognised on authority that each of the parties must have an equal voice in the matter of its perform ance and control over the agencies used therein though one authority may en trust the performance to another. There is also an authority to the affect that a joint venture may exist although the parties have unequal control of operations. The rights duties and liabilities of joint ventures are similar or analogous to those which govern the corresponding rights duties and liabilities of the part ners. As in the case of partners joint ventures may be jointly and severally liable to third parties for the debts of the venture (sec: American Jurisprudence Second Edition Vol. 46 para 12 at pages 3334 and para 57 at p. 76 ). Joint venture groups are internationally recognised in form of cooperation in the joint fulfilment of the construction contract obligations. Joint venture groups in the construction industry come about through agreements for combination of legally independent contractors for the joint rendering of construction services limited in both time and content. Typically they are restricted to a single pro ject in which case the members of the group act jointly at both the tendering and award stages. Joint venture groups are generally unincorporated associa tion. The legal systems in general have not kept pace with the growing eco nomic means of joint venture groups and there is no special legal form for this type of cooperation which has come to stay in construction industry. How ever in Australia and Germany joint venture groups as also unincorporated civil law partnership are subjected to law of partnership. In United States also the law of partnership is applied to joint venture consortia. It is only in France that a special legal form has been created in this behalf. The joint venture groups have got inter alia the characteristics of joint organisation joint action through cooperation of all members or all individual persons action on the instructions of the members and joint liability for condition of services to their parties and the relation between the partners inter se to be governed according to the joint venture group agreements. The joint venture groups have got inter alia the characteristics of joint organisation joint action through cooperation of all members or all individual persons action on the instructions of the members and joint liability for condition of services to their parties and the relation between the partners inter se to be governed according to the joint venture group agreements. The economic importance of joint ven ture consortia on the one hand and absence of specific legal provisions on the other has raised a host of problems of interpretation in individual cases since a wise variety of model contracts and preprinted contract forms are adopted to suit the needs and convenience of a particular construction project. These problems have direct effect on if the partners inter se and indirect effect on the third parties such as customers. If several construction enterprises tender jointly and have been jointly awarded the construction contract they are obliged to perform the contract jointly as joint venture group. One of the difficult problems which is likely to arise when a construction contract is about to be entered into since the customer when concluding the contract with a joint venture is leading with all the members of the group who are jointly com mitted to rendering the services. The contract has therefore to be concluded by an authorised representative of all the members of such a group enbloc for the simple reason that joint venture groups are unincorporated associations. The services to be rendered by the group are to be allocated amongst the members of the same by internal agreement and consequently the rights and duties of the members inter se are also regulated by the group agreement. These internal agreements are not effective vis-avis the third parties and they operate amongst the members inter se. Thus all the members are jointly and severally liable for performance of the construction work jointly undertaken irrespective of internal division of the work. If one member of the joint venture group does not fulfil his commitments the others are under joint and several obligation to carry out such obligations visavis the customer. Such a situation may arise when a member of a joint venture group drops out prematurely because of the liquidation or insolvency. If one member of the joint venture group does not fulfil his commitments the others are under joint and several obligation to carry out such obligations visavis the customer. Such a situation may arise when a member of a joint venture group drops out prematurely because of the liquidation or insolvency. When a contract is concluded with a joint venture group all members are made jointly and severally liable even if only one in capable of reordering the venture in question. The joint and several liabilities one the members of a joint venture group may cover the marginal areas of the contract performance such as late performance faults deficiency of goods and services etc. It is therefore very necessary while entering into such contracts with joint venture group that the construction contracts are carefully drafted and the members of such group must also enter into detailed agreements amongst themselves. (see: Article on Joint Venture Groups Effects of Con struction Contract Dr. Manfred Straubs Professor of Commercial Law Technical University Vienna in International Business Lawyer March 1985 a monthly published by a Section of Business Law of International Bar Asso ciation London ). ( 45 ) IN India a person can become a partner with another person in a particular adventure or undertaking (see: section 8 of the Indian Partnership Act 1932 This is described as a particular partnership also since it is confined to a particular adventure or undertaking or it may be one limited even to a particular advantage or undertaking or an isloated transaction in course of trade or business. However the three elements of partnership namely agree ment business and mutual agency must exist as a matter of course. The only difference between such partnership in nature of joint venture and an ordinary partnership is that in joint venture partners incur no responsibility beyond the limits of the particular adventure or business or undertaking and their rights and obligations are therefore less extensive than those of partners in ordinary partnership (See: Karmadli v. Karimji (1915) 39 I. L. R. Bom. 261 (PC ). 261 (PC ). ( 46 ) HAVING regard therefore to the legal position in general and to the particular position as available in India in respect of joint venture firms it is really difficult to conceive that in case of a joint venture consortia which seeks prequalification for purposes of obtaining tender documents there would be invariably a lead firm and the several responsibilities assigned to other joint venture partners. It is no doubt true that one of the columns in form C pertaining to joint ventures required the particulars regarding the responsibility of the lead firm and those of joint venture partners. As pointed out in Karmalis case (supra) joint venture is a partnership of a limited character and consequently the liability enforced against one partner when there is no document of debt which on its face binds him can only bel justified if it was shown that what he did was within the operations natural of the partnership and for the partnership. However when there is a cleat basic agreement between the persons entering into joint venture consortia it would indicate the nature of the liability of joint venture partners visavis the customer. This basic agreement in the present case clearly indicates that all the partners were jointly and severally liable to the State Government for the contract work jointly undertaken by them. It is. therefore difficult on principle as well in fact to agree with the view of the State Govt. that the application of the peti ignores for prequalification was nonresponsive. The learned Advocate General was at pains to emphasise that in form C filed alongwith the respective applications by the first and the second petitioners the particulars furnished did not indicate that the work was to be rendered jointly and the liability was joint and several. He invited our attention first to the application of the first petitioner wherein form C it has been stated that the lead company. namely AFCONS would execute the work whereas MAEDA would bring their trained selected persons and certain specialised equipments to ensure that the work is done in time to the required quality and standard. He invited our attention first to the application of the first petitioner wherein form C it has been stated that the lead company. namely AFCONS would execute the work whereas MAEDA would bring their trained selected persons and certain specialised equipments to ensure that the work is done in time to the required quality and standard. Similarly in the appli cation submitted by the second petitioner in form C in column 3 pertaining to the responsibility of lead firm as well those of other joint venture partners it has been stated as under:"all partners shall jointly and severally assume responsibilities to the employer for the execution completion and maintenance of the works of the project. However Asia Foundations and Constructions Limited (Sponsoring firms) has responsibility to provide to the J. V. with his knowledge pertaining to the construction works in India including procedure of customs immigration transportation taxations and other matters peculiar to India. Maeda Construction Co. Ltd. has responsibility to provide to the J. V. with his knowledge especially about dam construction and also responsible to arrange the dispatch of personal plant and materials from Japan". ( 47 ) THE learned Advocate General also invited our attention to the addi tional information furnished by the first petitioner in form G which is annexed as Enclosure 10 to their application for prequalification where the first peti tioner have inter alia stated that so far as the present contract was concerned. they were proposing to have an association with the second petitioner Company which is one of the largest civil engineering firms from Japan and have exe cuted a number of dam projects as would be evident from enclosures to their application. The particular statement on which the learned Advocate General relied reads as under;" It is planned that the work will be executed by us under the strict guidance and supervision of M/s. MAEDA Construction Co. Ltd. As regards equipment this will be either taken from our existing stock or purchased by us from foreign countries or will be brought by M/s MAEDA Construction for execution of this work on temporary import basis. . . . You will thus observe that there is a complete trans fer of technology from the foreign country to ours when the work is executed by AFCONS. . . . You will thus observe that there is a complete trans fer of technology from the foreign country to ours when the work is executed by AFCONS. We therefore request you to please take this into consideration while scrutinising the prequalification documents and we hope that you will give us an opportunity to submit our offer for this project". ( 48 ) ON the basis of the above statements it was urged by the learned Advocate General than the first and the second petitioners have though fit to furnish the particulars in form C column 3 pertaining to responsibilities of the lead firm and those of other joint venture partners. The combined reading of form C column 3 in both these applications together with the statement ex tracted as above from the additional information in form C clearly indicates that the contract work was to be executed by the first petitioner under the guid ance and supervision of the second petitioner Company though in form C furnished by the second petitioners it has been stated that the responsibility of the execution of the work is joint and several. If therefore in submission of the learned Advocate General having regard for the admitted fact that the first petitioner had no experience whatsoever in respect of the dam construction and power house construction and if the responsibilities of the first petitioner. which is described as a lead firm and those of the second petitioner which is joint venture partner are not clearly demarcated and accordingly stated in the relevant forms no exception can be taken to the decision of the State Government which has rejected the applications of the petitioners for prequalification on the recommendation of the Standing Committee as accepted by the Advisory Committee and cleared by the World Bank on the ground that the applications of the petitioners were nonresponsive and they did not specify the eligibility criteria prescribed for granting the prequalification. Thus submission of the learned Advocate General apparently appears to be attractive but on close scrutiny we are unable to sustain it for the obvious reason that the Standing Committee as well as the Advisory Committee have failed to consider the most relevant document in the nature of the basic joint venture agreement which has been furnished by both the petitioner companies. It is this basic agreement which is the most relevant information supplied by the petitioners which has been completely ignored from consideration. Article 1 which provides for the purpose of the joint venture is so unequivocal and apparent that it could not have been ignored by the authorities concerned. Article I reads as under:"article 1 Purpose of the J. V. A. Applying for prequalification for the tender for the project. B. The parties hereto shall prepare and submit the tender for the project in accordance with the tender documents as a joint venture. C. Upon award of the contract for the Project by the Employee to the J. V. the parties hereto shall execute complete and maintain the works jointly in accordance with the conditions of contract. (emphasis supplied) according to Article 2 the name of the Joint Venture is AFCONS MAHDA Joint Venture for Narmada Project. Article 6 which is again a very important clause pertain to the responsibilities of the parties. It reads as under: article 6 Responsibilities of the parties: The parties hereto shall cooperate themselves with one another shall faithfully perform and observe all the terms and conditions on the contract and shall jointly and severally assume responsibilities to the employer. (emphasis supplied) "article 7 provides that AFCONS would be the sponsoring firm of the Joint Venture who would be authorised to apply for the tender to submit the tender to complete the contract documents and to do all other matters relating thereto including signing the documents on behalf of the Joint Venture in consection with the project. ( 49 ) IT is really difficult for us to agree with the learned Advocate General that in view of this unequivocal arrangement incorporated in the basic document it can be ever concluded by the authorities as they did that the first petitioner company was to execute the works and that since it was described as a lead firm and the responsibilities of the other joint venture partners having not been clearly assigned. the application was nonresponsive. the application was nonresponsive. As we have noted above while discussing the true concept of the joint venture groups in context of construction contracts the following observation in the Article to which we have profuself referred to while setting out the correct connotation of joint venture groups is instructive on the point: When concluding a contract with a joint venture group the customer is dealing with all the members of the group one are jointly committed to tendering the service. SINCE jointventure groups are unincorporated associations the contract is concluded by an authorised representative or all members enable. The services to be rendered are allotted among the members of the jointventure group Internal agreement. Similarly the rights and duties of the members inter se are generally regulated by the provisions of the jointventure group agreement. Internal agreements between members of the joint venture group are not generally effective vis a vis third parties but merely constitute the basis for mutual services and entitlements within the joint venture group. Thus all members are jointly and severally liable for the performance of the construction work jointly undertaken irrespective of the internal division of the work. If a member of a joint venture group does not meet his commitments the other members are under a joint and several obligation to provide the missing services for the customer. . . . . . . . . . ". . . . When a contract is concluded with a joint venture group all members are made jointly and severally liable even if only one is capable or rendering the service in question. . . . . . . . . . . . . ". . . . When a contract is concluded with a joint venture group all members are made jointly and severally liable even if only one is capable or rendering the service in question. . . . " ( 50 ) IN our opinion therefore the authorities did not consider the most relevant information contained in the basic document and proceeded merely on some inaccurate and imprecise statements made in form C enclosed to the application of the petitioners III any case if these imprecice statements in form C of the two petitioners as well as the additional information in for G furnished by the first petitioner raise some doubt in the matter of the responsibilities of joint venture partners the Standing Committee or the Advisory Committee could have sought for clarification and further related information from the applicants as may be necessary so as to confirm the first impression gathered on perusal of these applications it is an admitted position that neither the Standing Committee nor the Advisory Committee thought it necessary to ask for clarification and further related information and made its scrutiny on the basis of the informal on supplied in various documents furnished along with the respective applications. As a matter of fact this approach stuck the World Bank Authorities as slightly unusual. As a matter of fact this approach stuck the World Bank Authorities as slightly unusual. We entirely agree with the view of the World Bank Authorities that this was not the usual and proper course for this high power committee to make the scrutiny and decide merely on the basis of the information supplied in these applications particularly when the information given in the prescribed proforma was not in consonance with not only the recognized legal concepts of joint venture firms but also with the basic agreement of joint venture which was unequivocal in its terms and in conformity with the recognized legal rights and liabilities of the partners of joint venture interse as well vis a vis the customer The Standing Committee in order to decide as to whether the joint venture consortia seeking prequalification were eligible or not examined the cases from the angle whether the lead firm had been identified and whether the workable and practicable arrangement has been made amongst the parties and whether the individual parties to whom the responsibilities regarding execution and financial arrangements are assigned were capable in their individual capacity to discharge them completely and satisfactorily. The learned Counsel appearing on behalf of the petitioners was therefore perfectly justified in urging that the Standing Committee as well as the Advisory Committee and for that matter the State Government have failed to apply their mind to the correct criteria to be adopted in deciding the question of prequalification in case of joint venture consortia applicants. The reasons as stated above are obvious. Firstly the committees failed to consider the most relevant information contained in the basic agreement document. and proceeded on some imprecise information given in the proformas without caring to call for the clarification and necessary related information in that behalf. Consequently in our opinion therefore they proceeded on the grounds which can hardly be said to be germane and relevant to the inquiry. Secondly the Committees have treated the joint venture consortia as a group of firms for all intents and purposes. They failed to realise that joint venture consortia is a distinct and separate category of applicants. This is manifestly clear from the information and instructions to the applicants seeking prequalification. Secondly the Committees have treated the joint venture consortia as a group of firms for all intents and purposes. They failed to realise that joint venture consortia is a distinct and separate category of applicants. This is manifestly clear from the information and instructions to the applicants seeking prequalification. It is in the case of the applicants who apply as a group of firms that the spon soring firm had to submit complete information pertaining to each finn in the group and to state in the covering letter as to which firm shall have the respon sibility for applying for and submission of tenders and for competition of the contract documents and give satisfactory evidence and full information regarding participation and responsibility of each member firm of the group of firms. It is in the case of this category of the applicants that there is an obligation to clearly identify the lead firm and define the extent of the responsibility of the lead and other firms. This obligation could not have been prescribed in the category of the applicants who are applying as joint venture consortia. The very fact that in case of joint venture consortia applicants they have been permitted during the tender period to strengthen their capacity by subsequent incorporation of prequalified firm with the approval of the State Government in an indication that they can reenforce their capability by including a prequalified firm; during the tender period. Thirdly the Standing Committee as well as the Advisory Committee overlooked the clear direction of the World Bank in adopting the procedure and prescribing rules for prequalification of the joint venture applicants for the dam construction as well as Power House construction. The Committee failed to appreciate the direction which the World Bank issued particularly in the telex message of 6/08/1984 since the authorities failed to adopt the correct criteria and prescribed entirely irrational criteria for them as if there is no difference between the joint venture firms and group of firms. The authorities of the World Bank were at pains to point out that if the joint venture partners are the lowest evaluated bidders the authorities must be satisfied that each firm carried appropriate responsibilities and is committed to joint and several responsibilities for performance of the contract. The authorities of the World Bank were at pains to point out that if the joint venture partners are the lowest evaluated bidders the authorities must be satisfied that each firm carried appropriate responsibilities and is committed to joint and several responsibilities for performance of the contract. The Bank Authorities further pointed out that for preualification purposes it was not necessary and some times even not possible to have full d tails of Joint ventures proposals and therefore joint ventures which include one or more firms which are able to perform the work and who indicate their and and several responsibilities should be prequalified. The Bank Authorities therefore suggested to review all those joint venture cases that have not been qualified and to see whether they meet those criteria and if there existed any doubt about the members of the joint venture authority or commitment would be permissible to prequalify for ventures on conclusion that they would make the necessary organizational rearrangements or legal commitments by the mind they hid in order to strengthen themselves in the last telex message of 26/12/1984 the World Bank Authorities even after agreeing to the clear recommendation of the Standing Committee as accepted by the Advisory Committee that in light of the need which had been indicated by the Bank in the least above the clarification the definition of joint venture it was recommendation that the prequalified and cants should be alerted to the requirements in the bid documents that will require joint and several liability for and partner in a joint venture. It is thus clear that the Bank Authorities were of opinion that the Committees were not unequivocal in their approach in cases of joint venture applicants and if the joint ventures include one or more firms who are capable to perform the work and who indicate that they are jointly and severally responsible these should be prequalified In our opinion the Committees have clearly overlooked the aforesaid relevant criteria as indicated by the World Bank which are in consonance with the recognised connotations of joint venture concepts in context of the construction contracts. Fourthly the ultimate decision of the State Government on the basis of the recommendation of the Advisory Committee though cleared by the World Bank is contrary to the public interest inasmuch as the basis objective incorporated in the guide line of the World Bank that all eligible bidders from developing as well as developed countries must have an opportunity to compete for the execution of the work is deleted by the procedure and rules adopted be the Committees which not only material wrong criteria and misdirected itself but also failed to consider relevant material and decided the question in a manner as no reasonable person would do it. The Committees treated the applicants as if they were tenderers and not simply applicants to prequalify to be allowed to tender with the result that the decision is contrary to public interest. In that view of the matter therefore the impunged decision rejecting the applications of the petitioners for prequalification for the dam construction as well as Power House construction is vitiated bad in law and therefore liable to be set aside. ( 51 ) FOR the reasons aforesaid therefore we allowed this petition and issued a writ of certiorari in the terms in which we have made the Rule absolute vide our order of 3/05/1985. Petition allowed. .