B. K. MEHTA, J. ( 1 ) BY the present petition under Article 225 of the Constitution of India the Petitioner Companies challenge the decision of the State Government refusing pre-qualification of the petitioners for the works of construction of concrete dam across Narmada river (hereinafter referred to as the annum Construction) which decision has been intimated by the 2nd Respondent vide letter of 23/01/1985 as bad in law and void on various grounds averred in the petition. A few facts need he noticed in order to appreciate the challenge to the impugned decision. ( 2 ) THE first Petitioner Company is a multinational company engaged in the business of constructing dams hydro-electric projects irrigation projects harbour airports canals water supply projects etc. and has executed works of the value of exceeding Rs. 600 crores outside India during the period of last nine years. The first Petitioner Company claims that it has been listed as one of the largest international construction companies by the Engineering News-Record Magazine of U. S. A. and has been placed at Sr. No. 42 in the list pertaining thereto. The only other Indian company according to the first Petitioner Company is Indian Railway Construction Company Limited which has been put at Sr. No. 47 by the aforesaid agency. It is claimed by the 1st Petitioner Company that for the year 1982 it effected highest turnover in civil construction works and has been recently pre-qualified for a project in Iraq of the value of Rs. 1000 crores. It has also undertaken works of large magnitude in Middle- East and North Africa. The equity and capital reserve of the first Petitioner Company for the relevant period of 1982-83 is in the vicinity of Rs. 100 crores. The first Petitioner Company has thus earned foreign exchange to the tune of Rs. 100 crores which is again the highest amongst all construction companies operating abroad and has been granted awards by the Government of India for earning such huge foreign exchange from 1980-81 till to-day. 100 crores. The first Petitioner Company has thus earned foreign exchange to the tune of Rs. 100 crores which is again the highest amongst all construction companies operating abroad and has been granted awards by the Government of India for earning such huge foreign exchange from 1980-81 till to-day. The large size projects executed by the first Petitioner Company are amongst others Obra Dam and Power House in U. P. the Tenughat Project in Bihar the Tawa Dam Project in M. P. the concrete Dam in Port Blair in Andaman Island the Lower Jhelum Hydel Project in the Kashmir Valley extension of Shanan Power House in Himachal Pradesh outer Harbour Project at Vishakhapatnam the Dry Dock at Vishakhapatnam the water supply project of Greater Bombay at Bhandup etc. It has also successfully executed dam construction project in Libya in North Africa and Sewage project in Iraq. The capital of the first Petitioner Company is of Rs. 50 crores and its working capital foreign investment and turnover for the year 1982 is to the tune of Rs 108 crores Rs. 67 crores and Rs. 224 crores respectively. ( 3 ) THE 2nd Petitioner Company is a international Canadian Company with a very wide experience and technical expertise acquired over a period of 41 years of its standing in construction of concrete dams and hydro-electric projects and has recently completed the project of Revalstock Dam with a high of 175 meters containing 2 0 0 M3 of mass concrete which is considered to be biggest high quality concrete dam in the world. ( 4 ) IN response to the separate invitations issued by the State Government in April 1983 to pre-qualify the prospective bidders for (1) dam construction and (2) excavation and tunneling and other civil works for the Underground River Bed Power House and apartment works for the Sardar Sarovar (Narmada) Project in Gujarat the petitioners submitted as joint venture consortia necessary documents and information for seeking pre-qualification for being prospective bidders for the dam construction on 18/08/1983 It should be noted that the petitioners also furnished necessary documents and information for pre-qualification for being bidders for the construction of River Bed Power House and apparent works for the Sardar Sarovar Project and they have been pre-qualified for the said works. The petitioners submitted the necessary documents and information for the dam construction as agreed between them in the joint pre-qualification agreement for the dam construction dated 9/07/1983 It is common ground that the joint venture consortia were eligible to apply for pre- qualification as bidders for the dam construction. The eligibility criteria for the pre-qualification of the prospective bidders for the dam construction was entail Asia that the applicant must be well established contractor with experience and capability in concrete dam and similar construction and must have placed 25000 cubic meters cement concrete per month and must have had in any one year during last five years turnover of the value of Rs. 400 million in construction. The information was to be furnished by the applicant in different performs as appended to the pre-qualification information. Form A required particulars of the organisational structure of the applicant. Form B pertained to the financial details of the applicant and these particulars were to be given separately for each partner in case of a joint venture. Form C pertained to the particulars of joint venture Form D related to the details of personnel resources. Form related to the details of equipment of plant and machinery with the applicant. Form F related to the experience of the applicant while Form G was for furnishing additional information if so desired by the applicant. It should be noted at this stage that both the petitioners have submitted the information and documents as required by the State Government and accordingly transmitted the requisite particulars in the prescribed performs as described here in above on the same day that is 18/08/1983 According to the petitioners they were satisfying the eligibility criteria for being pre-qualified. After of the necessary information and documents for pre-qualification the representatives of the first Petitioner Company personally contacted the authorities concerned in the State Government inquiring about their response on the pre-qualification when they were informed that the papers had been sent to the Government of India Ministry of Justice New Delhi for taking a final decision in the matter. The Petitioner No. 1 Company therefore wrote a letter on 21/04/1984 to the Government of India Ministry of Irrigation New Delhi inquiring about the decision on the pre-qualification application. The Petitioner No. 1 Company therefore wrote a letter on 21/04/1984 to the Government of India Ministry of Irrigation New Delhi inquiring about the decision on the pre-qualification application. Since there was no response the first Petitioner Company addressed another letter on 26/04/1984 to the Government of India in Irrigation Department furnishing further details in support of their application for pre-qualification. They also made a grievance that inspite of their request they are not granted any personal interview and that they did not understand any reason as to why pre-qualification was not granted to them. In the circumstances the Government of Canada through their High Commissioner in New Delhi took up the matter with the Government of India and had a meeting with the Secretary in the Minister Irrigation Department New Delhi on 29/06/1984 The Canadian High Commissioner assured that the second petitioner was a large well known Canadian Construction Company and expressed surprise that the joint venture of the Petitioner Companies was repeatedly not pre qualified. The contents of the interview was confirmed by the High Commissioner by his letter of 10/07/1984 addressed to the Secretary to the Government of India in Irrigation Ministry as well as in the Finance and Energy Ministries. The first Petitioner Company again addressed a letter on 16/07/1984 to the Secretary Government of India in ministry of Finance that the first Petitioner Company was the only Indian Company which has been pre-qualified by the foreign Government in Middle-East and North-Africa for huge construction projects costing over one million U. S. Dollars in preference to the companies from most advanced countries like U. S. A. Canada U. K France Germany Italy and Japan and that it was strange that in their own country the Government is not prepared to give a chance to participate in bid for a project which is smaller in value than those for which the foreign Governments have pre-qualified the first Petitioner Company in the past. As there was no reply another letter was addressed on 31/07/1984 to the Secretary to the Government of India in Finance Ministry enclosing a letter from the Engineering News-Record Magazine which is a World leading Engineering Industry magazine congratulating the first Petitioner Company on being among worlds largest international contractors. As there was no reply another letter was addressed on 31/07/1984 to the Secretary to the Government of India in Finance Ministry enclosing a letter from the Engineering News-Record Magazine which is a World leading Engineering Industry magazine congratulating the first Petitioner Company on being among worlds largest international contractors. It is the grievance of the Petitioners that despite all these representations there was no response from either the State Government or the Government of India and even the request for personal interview was turned down which promoted the Canadian High Commissioner to address a letter in that behalf on 17/08/1984 to the Honble Minister for Irrigation Government of India. To their surprise they received a letter from the 2nd respondent dated 23/01/1985 informing the first Petitioner Company that the State Government has not been able to pre-qualify the joint venture consortia for the dam construction. The petitioner No. 1 Company therefore tried to inquire as to what were the precise reasons for the inability of the State Government to pre-qualify the petitioners but no reasons were disclosed either by the State Government or the Government of India. The first petitioner Company therefore submitted a representation vide their letter of 5/03/1985 addressed to the State Government making a demand of justice on the grounds stated in the said letter to which there was no favorable response with the result that the petitioners were required to move this Court for appropriate writs orders and directions to quash and set aside the impugned decision and for enjoining the State Government to pre-qualify the petitioners for the work of dam construction. ( 5 ) PURSUANT to the notice issued by this Court affidavit in reply of Shri I. M. Shah who happens to be Secretary to the State Government in Narmada Development was filed opposing the admission of the petition. ( 5 ) PURSUANT to the notice issued by this Court affidavit in reply of Shri I. M. Shah who happens to be Secretary to the State Government in Narmada Development was filed opposing the admission of the petition. An affidavit-in-rejoinder has also been filed on behalf of the petitioners by the Managing Director of the first Petitioner Company on 27/03/1985 Since a similar petition was filed by Asia Foundation and Constructions Ltd. against the State Government in this very matter of pre-qualification for the dam construction and river bed power house construction which matter was admitted and heard Rule was issued by this Court on 8/08/1985 After admission a short affidavit of the aforesaid Shri I. M. Shah has been filed in reply to the petition on 11/12/1985 to which a rejoinder affidavit has been filed on the same day. ( 6 ) IT is necessary before we set out the contentions to refer to the precise reasons which weighed with the authorities and for that matter the State Government in taking the impugned decision. The reasons are to be found in the results of the scrutiny of the applications for pre-qualification which has been produced at Annexure V to the reply affidavit of Shri I. M. Shah dated 25/03/1985 The reasons are to be found at Sr. No. 7 and read as under7 13 CONTINENTAL The applicant is considered CONSTRUCTION non-responsive since the J. V. PITTS ENGG. Agreement is silent about spe- J. V. cific percentage of financial participation of each of the partners. The form C defines the responsibilities of the individual partner in such a way that M/s. Continental (who have not so far built large concrete dams) assumed almost the entire responsibility for the execution and management of the work and the role of M/s. Pitts the foreign collaborators is restricted to rendering technical advice alone. ( 7 ) AT the time of hearing of this petition Mr. ( 7 ) AT the time of hearing of this petition Mr. K. S. Nanavati learned Conceit for the petitioners urged the following contentions:1 The impugned decision is arbitrary and therefore bad in law inasmuch as: (a) the authorities concerned have failed to apply their mind to the correct criteria to be adopted in deciding the question of pre-qualification (b) they completely ignored the clear directions of the World Bank as to the approach the method and the correct paramiter to be applied in the matter of pre-qualification of joint venture consortia (c) they have failed to appreciate in correct legal perspective the liabilities of co-ventures in a joint venture group which was recognised as eligible entity to make an application for pre- qualification under the information and instructions to the applicants seeking pre-qualification and (d) the concerned authorities have failed to call for the further necessary information notwithstanding their obligation to do so if the particulars furnished in the various forms submitted by them were imprecise or raised some doubt as to the capability of the applicants to execute the project in question or commitments which the applicants have to make for execution of such contracts. 2 The impugned decision is vitiated by legal malafides and therefore bad in law inasmuch as; (a) it has been based on grounds which were extraneous and not germane to the criteria to be applied in pre-qualifying joint venture applicants namely joint venture agreement being silent about the specific percentage of financial participation of each of the partners; (b) it is one which no reasonable person could have reached on the facts and in the circumstances of the case; (c) it failed to consider the relevant materials furnished by the first petitioner Company which go to satisfy the criteria prescribed for being eligible for pre-qualification in the memorandum of information and instructions to the applicants issued by the State Government which prescribed inter alia that the applicant must be well established contractor will experience and capability in Rule old similar construction and (d) it is arrived in light of the guideline subsequently evolved by the Advisory Committee which guideline has gone beyond the original eligibility criteria as aforesaid. ( 8 ) IT is not necessary for us to state in details as to what were the different authorities which have been set up under the award of the Narmada Water Dispute Tribunal or the procedure and rules of evaluation approved by the Advisory Committee since they have been set out in detail in paragraphs 9 10 11 30 and 31 of the earlier judgment of this Court in basis Foundation and Constructions Ltd. v. State of Gujarat (1985) (2) 26 (2) Guj. L. R. 1208. Suffice it to say that in case of joint venture applicants the sponsoring firm has to submit complete information and identify the lead firm and that practical workable and legally enforceable arrangement is made amongst the co-venture to the satisfaction of the Committee by clear assignment of responsebilities regarding the execution and financial arrangement in such a way that the parties to whom such responsibilities are assigned are capable in their individual capacity to discharge them and particularly the lead firm has necessary skill and capacity to lead during the entire period of execution. The Committee was given liberty under the procedure so prescribed to ask for clarification and further related information from the applicants check their resources and make inspection of the prospective tender work. This procedure was prescribed in part I of the procedure and rules of evaluation. Rules were prescribed in part II in order to implement this procedure. Rule as provided that no evaluation will be done if application is non-responsive or if the applicant did not fulfill the twin criteria of its capacity of pouring 25 0 cubic metre cement concrete per month and having effected turnover of Rs. 40 crores in value of the construction work in any one of the last five years. Rule 4a which indicates as to what is the role of the lead firm should be set out in extenso. It reads;"4a 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 site and (c) in charge of financial dealings as regards all payments including payments for work done claims etc. will be considered for determining the pre-qualification. on site and (c) in charge of financial dealings as regards all payments including payments for work done claims etc. will be considered for determining the pre-qualification. What would be a non-responsive application is not made clear in the rules famed on 10/09/1983 for evaluation of the pre-qualification applications for dam construction. We can have indication as to what would be non-responsive applications from the similar rules frowned on 4/01/1984 for purpose of evaluating the applications for pre-qualification for the construction of river bed power house and appurtenant works thereto. Rule 1a is material and therefore set out below:"1a 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 non-responsive or (ii ). . . . . . . . . . . . . ( 9 ) IT is in this backdrop that we have to consider the contentions for assailing the impugned decision. What is the extent of the power of judicial review of administrative action in matters such as a pre- qualification of the prospective bidders on executive side and consequent decision of the concerned authorities in the Government refusing to pre-qualify the prospective bidders for execution of projects has been elaborately considered by the Division Bench of this Court consisting of one of us (B. K. Mehta J. and G. T. Nanavati J.) in Asia Foundation and Constructions Ltd. s case (supra ). The parameters of the courts power of judicial review of administrative action or the decision and the grounds for interference by the Court are well settled. If the action or the decision is perverse or is such that no reasonable body of 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 considerations the courts interference is justified since there is an implied obligation on the authorities to apply their mind to pertinent and proximate matters only and excluding the irrelevant and the remote (see: Smt. Shalini Soni v. Union of India AIR 1981 SC 431 ). The administrative authority must act in good faith must have regard to all relevant considerations and must not be swayed by irrelevant considerations and must not act arbitrarily or capriciously. Nor where a judgment must be made that certain facts exist can a direction be validly exercised on the basis of an-erroneous assumption about these facts. These several principles have been conveniently grouped in two main categories failure to exercise a discretion and excess or abuse of discretionary power (see: C. I. T. Bombay v. Mahindra and Mahindra Ltd. AIR 1984 SC 1182 ). The expression arbitrary and capricious is sometimes used as a synonym for unreasonable and in one case this has been transmuted into frivolous or vexatious and capricious and vexations. But the meaning of all such expressions is necessarily the same since the true question must always be whether the statutory power has been exceeded. Unreasonableness is a generalized rubbery covering not only sheer absurdity or caprice but also illegitimate motives and purposes a wide category of errors commonly described as irrelevant considerations and mistakes aged misunderstanding which can be classed as self-misdirection or addressing oneself to the wrong question (see: Wade Administrative Law Fifth Edition at p. 365 ). The absence of a statutory power should not in itself be a conclusive reason for a refusal by the Court to entertain proceedings in which it was alleged that the companies were excluded from submitting tenders on the basis of manifestly arbitrary considerations (see: De Smiths Judicial Review of Administrative Action 4 Edition p. 289 ). The principle of reasonableness and rationality must characterised every State action whether it be under authority of law or in exercise of the executive power without making of law (see: Ramana v. International Airport Authority AIR 1979 SC 1628 ). ( 10 ) IT should be noted at the outset that in the report of the scrutiny by the Standing Committee it has been recorded that the said Committee did not find it necessary to ask for clarification and further related information from the applicants but made its evaluation on the basis of the information supplied in various documents furnished along with the application. At the outset we may dispose of a short contention as to whether the petitioners intended and agreed to form a joint venture and seek pre-qualification accordingly. At the outset we may dispose of a short contention as to whether the petitioners intended and agreed to form a joint venture and seek pre-qualification accordingly. We should remind ourselves of the two grounds which weighed with the Standing Committee in refusing to pre-qualify the petitioners. Shortly stated the two grounds are (1) the application being non-responsive and (2) M/s. Continental which has been assigned the entire responsibility of execution and maintenance of the dam construction did not possess any experience of construction of concrete dams. In other words the petitioners have been refused pre-qualification not on the ground that theirs is not a joint venture or that the agreement which was furnished with the application for pre-qualification was not a joint venture agreement in real sense of the term. We have therefore to judge in the limited context of the aforesaid two grounds which weighed with the authorities in refusing pre-qualification. No doubt at the time of hearing of this petition an attempt was made on behalf of the State Government to inter alia urge that there was no intention on the part of the petitioners to form a joint venture but in effect and substance the so-called joint venture agreement which is said to have been effected on 3/08/1983 and produced at Annexure C/1 to the petition and a copy of which was not furnished to the authorities clearly established that what the parties intended to enter into was a technical collaboration agreement by which the first petitioner were designated as a sponsor company and assigned the responsibility for executing the works and providing of capital finance equipment man-power and management in that behalf while the second petitioner were to act merely as a technical collaborator of the first petitioner with respect to the works by providing initial technical know how and operational know how in respect of the works. In this connection our attention has been invited particularly to clauses 3 4 5 6 7 10 and 13 of the said agreement. In this connection our attention has been invited particularly to clauses 3 4 5 6 7 10 and 13 of the said agreement. It should also be noted at this stage that the application for pre-qualification for dam construction was forwarded to the State Government under the cover of transmittal letter of 18/08/1983 lay the petitioners It is therefore clear that before this application was made the joint pre-qualification agreement for clam construction was also entered into on 9/07/1983 We may therefore read the material parts of these two agreements to decide this short contention as to whether the parties really were ad idea in forming the joint venture. The joint pre-qualification agreement of 9/07/1983 recites later alia to the effect that whereas the petitioners lay agreed and mutually decision to apply jointly for pre-qualification and if and when pre- qualified to submit tender for dam construction and if the tender is accepted then to perform the works as a joint venture and with that end in view they mutually agreed amongst other things that they would jointly prepare and submit the documents required for pre-qualification and they would immediately enter into and sign the pre-bid agreement before submission of the tender as per the draft approved by both the parties and jointly prepared. In the joint venture agreement of 3/08/1983 it has been inter alia recited to the elect that whereas the petitioners have entered into joint pre-qualification agreement dated 9/07/1983 to submit an application for pre-qualification for dam construction and also to enter into and sign the pre-bid agreement if and when they are short-listed by the Gujarat Government and whereas further they have agreed to collaborate with each other for the purpose of subjecting a bid for the dam construction and if successful for the execution of the said works and with that end in view they agreed amongst other things to collaborate with each other for the execution of the other works. The relevant clauses are set out as under:"3 THAT COMMITMENT is designated as the Sponsor Lead Company of the joint vulture and that the management of the joint venture will be the responseability of the sponsor. The Sponsor shall be responsible for executing the WORKS and shall provide all capital and finance equipment manpower and management required in this regard. The relevant clauses are set out as under:"3 THAT COMMITMENT is designated as the Sponsor Lead Company of the joint vulture and that the management of the joint venture will be the responseability of the sponsor. The Sponsor shall be responsible for executing the WORKS and shall provide all capital and finance equipment manpower and management required in this regard. Without limiting the generality of the foregoing CONTINENTAL shall be responsible for and entitled to make all decisions connected with the WORKS including those relating to selection of personnel maintenance of records preparation and submission of the progress payment applications banking procedures and all discussions and agreements with the EMPLOYER- CONTINENTAL shall also be responsible for payment of salaries wages and other kinds of remuneration for services purchased and payment for supplies and materials. 4 THAT CONTINENTAL alone shall be liable to provide to the EMPLOYER all performance and other bonds or guarantees which may be required under the terms of the contract or otherwise. All profit or loss accruing or arising from the execution of the WORKS shall belong solely to CONTINENTAL. 5 THAT all movies on account of the WORKS as and when received shall be deposited to the credit of the Sponsor in an account or accounts to be opened in its name with the State Bank of India and/or any other banks as the Sponsor may decide. Cheques may be drawn on such account or accounts by signature or signatures of such persons as may be designated by the Sponsor the Sponsor will be responsible for arranging loans overdrafts. and or other banking facilities with the State Bank of India and for other banks for and in connection with the execution of the WORKS. 6 THAT PITTS will act as technical collaborator of CONTINENTAL with respect to the WORKS and it will provide confidential initial technical know how consisting of all information in respect of data documentation drawings designs and specifications relating to construction of concrete denims as detailed in Annexure A hereto. terms (i) (ii) and (v) of clause (INITIAL TECHNICAL KNOWHOW) of Annexure A shall be provided to CONTINENTAL during the tendering stage and items (iii) (iv) and (v) thereof shall be provided after the award of the contract in respect to the WORKS. Said initial technical know how shall be transferred and delivered by Pits in canada to a representative of CONTINENTAL. Said initial technical know how shall be transferred and delivered by Pits in canada to a representative of CONTINENTAL. 7 THAT in addition to the initial technical knowhow agreed to be provided by PITTS as herein above stated PITTS shall also provide operational technical know how consisting of technical assistance and advice which may be required by CONTINENTAL for the actual execution of the WORKS as detailed inannexure A. 10 THAT to further the technical collaboration with respect to the WORKS and the application of the operational technical know how referred to in clause 7 hereinabove for execution of the WORKS the Sponsor shall set up an Advisory Committee comprising of four members two from CONTINENTAL and two from PITTS. The nominees to the Advisory Committee and their alternates who will serve in the absence of nominees are listed in Annexure C there to. At all meetings of this Committee a quorum shall consist of three members. A representative from Continental shall chair the meeting. Each member of the Advisory Committee shall have one vote. Decisions of the Advisory Committee shall be made by majority. In the event of even vote the Chairman shall have the casting vote. The Advisory Committee shall ordinarily meet on the designated by mutual agreement of the parties. The Advisory Committee shall consider and advise on such matters as the overall planning for the completion of the WORKS determination of requirements and selection of planted equipment and major items of construction materials. The Sponsor shall be responsible for fares living and conveyance Expenses in India of personnel attending the Advisory Committee meetings. The decisions of the Advisory Committee may be submitted to the Managing Director of CONTINENTAL who in his sole discretion may or may not accept them. 13 (a) THAT in consideration of the Transfer of Initial technical knowhow outside India by PITTS as detailed in Annexure A CONTINENTAL shall pay to PITTS subject to Indian tax a lump sure fee equal to 1% (one percent) of the face value of the contract which will mean the original gross value of the contract for the construction of the WORKS as originally awarded and will exclude any changes to original gross value on account of escalation or on account of any deletions or extras or changes in quantities. The said lump sum shall be payable to PITTS in the following installments : continental shall pay to PITTS 1. 5% (one and one hellfire cent) of gross monthly billings as submitted by the Sponsor to the EMPLOYER until the total of such monthly payments to PITTS shall add up to 1% (one per cent) of the gross value of the contract as Originally awarded13 (b) THAT in addition to the lump sump payment for initial technical knowhow and in consideration of operational technical knowhow and other services to be provided by PITTS in terms hereof the Sponsor shall pay to PITTS subject to Indian tax a fee equal to 1% (one per cent) of the face value of the contract which will mean the original gross value of the contract as originally awarded and will exclude any changes to original gross value on account of escalation or on account of any deletions or extras or changes in quantities. this fee shall be payable to PITTS if established targets of job performance have been achieved. The targets of job performance shall be established by Continental AND PITTS jointly after examining the tender documents. Subject to performance on the WORKS achieving the above established targets the payment of 1% (one per cent) shall be made in three installments as follows; (i) Fee equal to 0. 25% one quarter of one per cent) of face value of the contract shall be made 12 months from the date when the last installment was due and payable under Clause 13 (a ). (ii) Fee equal to 0. 25% (ore quarter of one per cent) of face value of the contract shall be made 24 months from the date when the last installment was due and payable under Clause 13 (a ). (iii) Fee equal to 0. 5% (one half of one per cent) of face value of the contract shall be made after completion certificate has been received from the EMPLOYER". ( 11 ) ON reading the joint pre-qualification agreement as well as the joint venture agreement we are unable to agree with the learned Advocate General that the parties did not intend to form a joint venture and what they really agreed to is merely a technical collaboration agreement. ( 11 ) ON reading the joint pre-qualification agreement as well as the joint venture agreement we are unable to agree with the learned Advocate General that the parties did not intend to form a joint venture and what they really agreed to is merely a technical collaboration agreement. The recital in the joint pre-qualification agreement read with the recital in the joint venture agreement and particularly clause 3 of the joint venture agreement clearly establishes that the petitioners agreed and undertook to seek pre-qualification and to make a bid for the work if the tender is accepted to perform the works as a joint venture. The learned Advocate General repeatedly drew our attention to clause 4 of the joint venture agreement which made only the first petitioner liable to provide to the Government all performance and other bonds or guarantees required under the terms of the coninstruction contact or otherwise and entitled the petitioner No. 1 to receive all profits or bear the loss Ukraine or arising from the execution of the works and the second petitioner were only entitled to the fees as specified in clause 13 for supply of initial and operational technical knowhow. It is no doubt true that it has been agreed upon by and between the first and the second petitioners that the first petitioner shall be solely responsible for execution and management of the project and accordingly entitled to receive the profit or bear the loss and that the 2 petitioner are required to Furnish the initial and operational technical knowhow in consideration of the fees agreed between them none- the less the petitioners agreed and undertook that quo the State Government they would seek pre-qualification submit tender for and to perform the works if the tender is accepted as joint venture. The learned Advocate for the petitioners submitted that the petitioners have not been refused pre-qualification on the ground that they were not joint venture in reality and therefore not entitled to seek pre- qualification accordingly. The learned Advocate for the petitioners submitted that the petitioners have not been refused pre-qualification on the ground that they were not joint venture in reality and therefore not entitled to seek pre- qualification accordingly. We do see a great force in this contention urged on bel if of the petitioners but in our opinion over and above this fact with respect to the learned Advocate General what is not borne in mind while advancing this short contention about the parties not being on ad idea to form a joint venture is that the material portions which are relevant for purposes of deciding as to whether they intended to form a joint venture are lost sight of. The recital clause in the joint pre-qualification agreement as well as Article 1 of the said agreement clearly establish the agreement between the petitioners to seek pre-qualification and submit the tender and execute the works as joint venture consortia. Clause 3 of the joint venture agreement clearly indicates that the first petitioner were designated as a Sponsors Lead company of the joint venture the responsibility of its management has been assigned to them as such. No doubt the role of the 2nd petitioner vis a vis the first petitioner are that of technical collaborator and are entitled to claim the fees for supply of technical knowhow to the joint venture whose profit and loss is the sole responsibility of the first petitioner. It should be emphasised at the cost of repetition that this assignment of the roles is either the petitioners and not quo the State Government since according to the joint pre-qualification agreement the parties had agreed to seek pre- qualification submit the tender and execute the works as a joint venture consortia. We therefore do not agree with the learned Advocate General that there was no joint venture intended and agreed upon between the first and the second petitioners. We have therefore to consider as to whether the petitioners are entitled to all or any of the reliefs they have prayed for in this petition. Re: Contusions No: 1 and 2: ( 12 ) THERE are four limbs of this contention which can be summed up broadly by saying that the authorities reached the impugned decision by applying incorrect criteria and on imprecise materials. Re: Contusions No: 1 and 2: ( 12 ) THERE are four limbs of this contention which can be summed up broadly by saying that the authorities reached the impugned decision by applying incorrect criteria and on imprecise materials. In view of what we have said about the joint venture capacity of the petitioners in seeking pre-qualification and having regard to the important fact that the application of the petitioners having not been rejected on the ground that their s was not a joint venture the approach of the authorities and the parameters which they were required to apply in appreciation of such cases were not according to the correct principles of law but were also clearly in contravention of the guidelines prescribed ky the World Bank and the directions issued in pursuance thereof. If the capacity of the petitioners seeking pre- qualification was that of joint venture which not only in our opinion but even in the opinion of the Government was so the approach of the Government in decision as to whether the pre-qualification should be granted or not should have been as to what is the legal liability of joint ventures in execution of construction contracts quo the employer. The approach and methyl could not have been conditioned by emphasising and proceeding on the basis of the internal relationship but been the joint venture co-shares. What is the legal concept of the joint venture Particularly in context of construction contracts has been summed up by this court in Asia Foundation and Construction Ltd. s case (supra ). "the Division Bench speaking through one of us (B. K. MEHTA J.) observed as Under in Asia Foundation and Construction Ltd. s case (supra ). The legal concept of the joint venture is very well recognised 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 has completely misdirected themselves. The common law did not recognise the relationship of co-adventurers but with the passage of time the judicial decisions recognised what is known as joint adventures of two or more persons undertaking to combine their properly or labour in conduct of particular line of trade or general business for joint profits. If they are they has completely misdirected themselves. The common law did not recognise the relationship of co-adventurers but with the passage of time the judicial decisions recognised what is known as joint adventures of two or more persons undertaking to combine their properly or labour in conduct of particular line of trade or 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 said in the contractual relationship created by such adventures that the rights as between them are governed practically by the same rules that govern the partnership. This relationship has been defined to be a special combination of persons undertaking jointly some specific adventure for profit without any actual partnership. It is also described as a commercial or a maritime enterprise undertaken by severe persons jointly a Limited partnership not limited in the statutory 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 kissers to be coincide over several years while the lather relates to a joint business of a particular line (see: 48 American low Reports at p. 1055 under the caption what amounts to a Joint adventure at pages 1056-57 and 1060 ). It is generally agreed that in order to constitute a joint venture there must be immunity of interest not right to joint criminal. It is recognised on authority that each of the parties must have an equal voice in the matter of its performance and control over the agencies used therein though one party may entrust the performance to another. These is also an authority to the effect that a joint venture may exist although the parties have unequal control of operations. The rights duties and liabilities of joint ventures are signaler or analogous to these which govern the corresponding rights duties and liabilities of the partners. As in the case of partners. joint ventures may be jointly and severally liable to third parties for the debts of the venture (see: American Jurisprudence. Second Edition. Vol. 46 para 12 at pages 33-34 and para 57 at p. 76. As in the case of partners. joint ventures may be jointly and severally liable to third parties for the debts of the venture (see: American Jurisprudence. Second Edition. Vol. 46 para 12 at pages 33-34 and para 57 at p. 76. Joint venture groups are internationally recognised in form of co-operation in the joint fulfillment of the construct an contract obligate one. Joint venture groups in the construction industry come about through agreements for combination of legally independent contractors for the joint render mg of construction services limited in both the time and content. Typically they are restricted to a single project in which case the members of the group act pointy at both the tendering and award stages. Joint venture groups are generally unincorporated association. The legal systems in general have not september with the growing economic means of joint venture groups and there is no special legislature for this type of co- operation which has come to stay in construction industry. However 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 legs form has been created in this behalf. The joint venture groups have got inter alia the characteristics of joint organisation joint action through co-operation of all members or all individual persons acting on the instructions of the members and joint liability for condition of services to third parties and the relation between the partners inter se to be governed according to the joint venture group agreements The economic importance of joint venture 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 wide variety of model contracts and pre-printed contract forms are adopted to suit the needs and convenience of a particular construction project. These problems have direct correct on the partners inter se and indirect Exact on the third parties such s 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. These problems have direct correct on the partners inter se and indirect Exact on the third parties such s 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 hen a construction contract is about to be entered into since the customer when concluding the contract high a joint venture is calling with all the members of the group to are jointly complained to re-entering the services. The contract has the before to be concluded by an authorized respective of all the member of public a group socialize the services to be reader by the group are to be allocated following the members of the same by internal agreement and consequently the regulates and duties of the members inter se are also regulated by the group agriculture. These internal agreed its ar not selective vis-a-vis the third parties and they operate amongst the members has se. Thus all the members are jointly and severally liable for performance of the Jointly work jointly undertaken irrespective of internal division of the work if on main of the joint venture group does not fulfill his commitment the others are under joint and several obligation to carry out such obligations vis-a-vis 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 in unbars are made jointly and service liable earlier if only the is capable of rendering the service in question. The joint and several liabilities of 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 constriction contracts are carefully drafted and the mulberries of such group must also enter into detailed Agreements amongst then- selves (See: Article on Joint Venture Groups-effects of Construction Contract-Dr. Manfred Strobes therefor of Commercial Law Technical University Vienna in international Business Lawyer March 1985 a monthly published by a Section of Business Law of International Bar Association London )". Manfred Strobes therefor of Commercial Law Technical University Vienna in international Business Lawyer March 1985 a monthly published by a Section of Business Law of International Bar Association London )". ( 13 ) IT should not be lost sight of that internal agreements between the members of a joint venture group are not generally effective vis-a-vis the third parties and they merely constitute the basis for mutual services aid entitlements within the joint venture group. The members of joint venture are jointly and severally liable for performance of the construction work jointly undertaken irrespective of the internal division of work. If a member of a joint venture group does not fulfill his commitments the other members thereof are under obligation to provide the missing services to the customer. If the customer enters into a contract with a joint venture group it increases the liability of the members of the joint venture for due performance of the construction work. As noted above when a contract is concluded with a joint venture group all members are made jointly and severally liable even if only one is capable of rendering the services in question. The justification for such liability is the possibility of bringing pressure to bear on a member of the group in order. to induce him to render his share of the services or if necessary to arrange for a substitute. of course members of a joint venture group who do not full their commitments remain liable to co-share to indemnify their co-venture (See: Article on Joint entity Group (supra ). The joint and several liability of co-ventures is not only for the execution of the works but also in respect of any claims for damages by the customer and in respect of all joint financial commitments to suppliers planners and architects and also in respect of fees dues penalties or other payments to public authorities. In any case the internal agreements regarding liability have no force vis-a-vis third parties. ( 14 ) THE two grounds which weighed with the authorities in our Opinion vitiate the impugned decision since the authorities have failed to appreciate in correct legal perspective the liabilities of co-ventures in a joint venture group which was recognised as eligible entity to make an application for pre-qualification under the information and Instructions to the applicants by the Government. The first ground about the agreement being silent as to the specific percentage of financial participation of each of the partners cannot be considered Sufficient for treating the application as non-responsive for two reasons. In the first place to constitute a joint venture the parties have to contribute their property moneys efforts skill or knowledge in some common undertaking. The contribution of respective parties need not be equal or of some character but there must be some contribution by each co-adventurer of something primitive of the enterprise. A contribution of services by a person may in a given case make him a participant in the joint venture (sec: American Jurisprudence 2 Edition Vol. 46 para 11 under the caption contributions at pages 32 In the second place it has been nowhere prescribed that the partners in a joint venture group were under obligation to precisely indicate the specific percentage of financial participation. Column 5 of Form C of the application requires details regarding financial participation of each firm in the joint venture. The opening remarks in from C clearly indicate that the applicant intending to enter into joint venture for the project has to give the information required in columns 1 to 5 if applicable In any case this High Powered Committee not only failed to appreciate in correct legal perspective the concept of joint venture consortia or group inter alia in the matter of their financial liabilities inter se or vis-a-vis the third parties but also lost sight of the fact that the particulars in regard to the financial participation are to be furnished in column 5 of Form C only if applicable with the result that the impugned decision has been vitiated as being contrary to reason and therefore bad in law. ( 15 ) THE second ground which has been specified in the results of the scrutiny for refusing the pre-qualification does not disclose as to what precisely wiggle with the authorities in reaching the impugned decision. ( 15 ) THE second ground which has been specified in the results of the scrutiny for refusing the pre-qualification does not disclose as to what precisely wiggle with the authorities in reaching the impugned decision. It appears though it has not been clearly stated in the reasons that the division of responsibilities as specified against column 3 of Form C did not commend to the Government since the first petitioner M/s. Continental have assumed almost the entire responsibility for the execution and management of the work though they had not so far built large concrete dams while the role of the 2nd petitioner M/s. Pitts gas restricted to rendering technical advice only. It should be necessary therefore to recapitulate what the petitioners have stated against column 3 in Form C appended to their application for seeking pre-qualification. We reproduce in extenso what the petitioners have stated in column 3 in Form C. It reads as under:3 Indicate the responsibility Continental Construction Limited of the firm leading the is leading the joint venture. They joint venture and responsi- will have overall responsibility for bility of other joint venture mobilization construction plann- partners. ing execution and management of the project whereas Pitts Engineering Construction of Canada will be technical collaborator in joint venture and will have responsibility of providing specialised technical knowhow selection of equipment operational technical knowhow after commencement of works development of equipment and ultimately ensuring that the scheduled quantities of equipment and other items of work are achieved per day. They will also be responsible to provide if so requested by Continental key engineering personnel for specialised skills in the project. (Emphasis supplied) ( 16 ) THE authorities considered this division of responsibilities as if it left the first petitioner. Company as mainly responsible for the execution construction and management of the project and since they had no experience of building large concrete dams the authorities decided not to pre-qualify the joint venture though admittedly the second petitioner were fully qualified and experienced enough and therefore capable of executing the project. In our opinion the authorities have failed to appreciate in correct legal perspective the liabilities of co-venturers in a joint venture group vis-a-vis the customer and to that extent they have misdirected themselves in law with the result that the impugned decision is vitiated. In our opinion the authorities have failed to appreciate in correct legal perspective the liabilities of co-venturers in a joint venture group vis-a-vis the customer and to that extent they have misdirected themselves in law with the result that the impugned decision is vitiated. The learned Counsel appearing on behalf of the petitioners therefore urged in view of the decision of this Court in Asia Foundation and Constitution Ltd. s case (AFCONs case for short) 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 pre-qualification of joint venture consortia applicants. The learned Advocate General sought to repel this contention by urging that the decision of this Court in AFCONs case is not applicable which the State Government has accepted in the present case on the facts and circumstances before us. He pointed out that the joint pre-qualification agreement of 9/07/1983 furnished alongwith their application for pre-qualification admittedly did not specify the division of responsibilities and therefore the State Government has to consider and decide on the particulars furnished in Form C where the first petitioner on their own showing assumed the overall responsibility for the execution construction and management of the project while the role of the 2nd petitioner was that of a technical collaborators only. The learned Advocate General pointed out the distinction which existed between the AFCONs case and the present case. In submission of the learned Advocate General the basic document of the joint venture agreement in AFCONs case prescribed inter alia that upon the award of the contract for the project by the employer to the joint venture the parties had agreed to execute complete and maintain the works jointly in accordance with the conditions of the contract and they further undertook that they would jointly and severally assume the responsibilities to the employer. What weighed according to the learned Advocate General with the Court in AFCONs case was that the authorities overlooked this basic agreement between the parties in AFCONs case and the failure to consider this relevant material coupled with the mis-apprehension as to the correct legal position as to the joint venture consortia prompted the Court to rule that the decision of the State Government not to pre-qualify the AFCONs joint venture was unreasonable and therefore bad in law. The Court also borne in mind that if any particulars furnished in the proformas with the application for seeking pre-qualification were at variance with this basic understanding the Government was expected to call for better particulars and related information as directed by the World Bank. If therefore in the submission of the learned Advocate General the joint pre- qualification agreement annexed to the application for pre-qualification in the present case did not specifically divide the responsibilities and the particulars about this division are furnished in Form C alone no exception can be taken to the approach of the State Government in reading those particulars and reaching the conclusion in light thereof. If the particulars so furnished indicate that the first petitioner Company were to be a lead firm of the joint venture and that they would be responsible for executing the works though they had no experience of building large concrete dams while the second petitioner would have merely the role of technical collaborators the authorities cannot be accused of acting in an unreasonable manner in reaching the conclusion that on the facts stated the joint venture should not be pre-qualified. In support of his submission the learned Advocate General not only relied on the joint pre-qualification agreement of 9/07/1983 but also on the joint venture agreement entered into on 3/08/1983 in pursuance of the previous agreement. The learned Advocate General drew our pointed attention to the clauses from the joint venture agreement of 3/08/1983 which we have extracted hereinabove. We do appreciate the distinction which the learned Advocate General tried to make on the facts of the present case. However with respect to him the distinction in our opinion is without real difference. The learned Advocate General drew our pointed attention to the clauses from the joint venture agreement of 3/08/1983 which we have extracted hereinabove. We do appreciate the distinction which the learned Advocate General tried to make on the facts of the present case. However with respect to him the distinction in our opinion is without real difference. The basic approach and method which the authorities have to adopt in determining the question of pre-qualification of joint venture groups is that prescribed by the World Bank and the correct legal perspective of the liabilities of co-venturers vis-a-vis the employer. Nc doubt in AFCONS case the basic joint venture agreement precisely indicated the liabilities of the co-venturers qua the employer as well as inter se. That does not mean that the authorities while determining the question of pre-qualification lose sight of and/or act in a manner which is clearly contrary to the guidelines prescribed and the directions issued by the World Bank or they lose sight of the correct legal perspective of the joint venture concepts in construction contracts. In the present case the authorities decided the entire question of pre-qualification so far as the petitioners were concerned apparently on the basis of the particulars supplied in Form C. 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 pre-qualification in case of joint venture consortia applicants. The authorities lost sight of the legal perspective of the liabilities of the co-venturers vis-a-vis the employer and they proceeded on the basis of the internal division of the responsibilities between the co-venturers inter se. As pointed out above these internal agreements are not effective vis-a-vis the third parties and they operate amongst the members inter se and all the co-venturers are jointly and severally liable for performance of the construction works jointly undertaken irrespective of the internal division of the works and 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 vis-a-vis 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 of rendering the services in question. In light of the legal concept of joint venture consortia as recognised in the context of the construction contracts in different countries that the World Bank appears to have suggested in their telex message of 6/08/1984 sent to the authorities of the State Government that joint ventures which include one or more firms who are able to perform the work and who undertake that they are jointly and severally responsible should be pre-qualified and to review all those joint ventures that have not been pre-qualified to see whether they meet this criteria and therefore should be pre-qualified. If therefore any doubt existed about the members of the joint ventures ability or commitments clarifications should be requested and it was permissible to pre-qualify joint venture on the condition that they would make the needed organisational re-arrangements or legal commitments by the time they bid in order to strengthen. If this suggestion of the World Bank had been followed in its true spirit we are sure that the authorities could not have reached the conclusion as they did. To state the suggestion in other words the authorities were required to pre-qualify those joint ventures which included one or more firms who were able to perform the work and who indicate that they are jointly and severally responsible for the execution of the work and the authorities had to review all cases of joint ventures not pre- qualified inter alia by calling for the better particulars and related information if there existed any doubt in the minds of the authorities about the ability or commitments. Now so far as the ability of the 2 petitioner is concerned the authorities did not and could not entertain any doubt. It is only because there is no clear commitment in their application though the legal position is clear enough that the authorities might be slow before granting the pre-qualification and therefore the authorities were expected to call for the clarification from the petitioners as to whether they were prepared to indicate clearly whether they would he jointly and severally responsible for the execution of the works. In so far as the authorities failed to call for this clarification from the joint venture group which they were expected not only in pursuance of the suggestion made by the World Bank authorities in the aforesaid telex message but also under their own procedure we must hold that the authorities acted in a manner which hardly can be said to be reasonable with the result that the impugned decision is vitiated as being unreasonable and arbitrary. The contention of the learned Advocate General that the authorities could not be said to have acted in an unreasonable manner since they relied on the information supplied in Form C is in our opinion too spacious a contention which we cannot accept. The authorities were expected to seek further information under their own procedure where required. The World Bank suggested to the authorities that the joint venture groups having capable partners should be pre-qualified if they indicate their liability to be joint an i several for execution of the works and on review if any doubt existed in the minds of the authorities as to the capability or commitment they were expected to call for the clarifications from the joint venture applicants. In the ultimate analysis the decision is unlawful if it is one to which no reasonable authority could have come to. An authority entrusted with the discretion should direct itself properly in law and it must call on its attention to the matters which it is bound to consider and if it does not obey this rule it is said to be acting unreasonable. In view of this settled legal position we are of the opinion that the authorities acted in an unreasonable manner in so far as they failed to call for the clarifications though they were expected to under their rules in pursuance of the suggestion of the World Bank. It is not capable of being argued that the petitioners were not a joint venture group. There was sufficient material before the authorities that the petitioners were seeking pre-qualification as a joint venture consortia. As a matter of fact the application of the petitioners has not been rejected on the ground that theirs were not a joint venture and was merely a group of firms. There was sufficient material before the authorities that the petitioners were seeking pre-qualification as a joint venture consortia. As a matter of fact the application of the petitioners has not been rejected on the ground that theirs were not a joint venture and was merely a group of firms. The impugned decision of the State Government also proceeds on this basis that the petitioners application was in the capacity of joint venture consortia. The joint pre-qualification agreement of 3/08/1983 clearly establishes that the first and 2nd petitioners have agreed and undertaken to seek pre-qualification and to bid for the works and to execute the works if their tender was accepted as a joint venture group. Form C to the application for pre-qualification requires particulars to be furnished by such parties who intend to seek pre-qualification as joint venture group. The first column of Form C is pertaining to the name and address of joint venture where it was stated to be CONTINENTAL CONSTRUCTION- PITTS ENGINEERING (JOINT VENTURE) Continental House 28 Nehru Place New Delhi 110 019 Column 2 which pertains to the name and address of all partners of joint venture where the names and address of the first and second petitioners have been given. Column 4 releates to the name and address of Bankers to the joint venture where State Bank of India Overseas Branch Parliament Street New Delhi 110 001 has been specified as the Bankers to the joint venture. In the circumstances it is not possible to urge that the application of the petitioners was otherwise than as a joint venture consortia. No doubt in the joint venture agreement of August 3 1983 and particularly in light of the paragraphs which we have extracted above there is a division of the responsibilities between the first and the 2nd petitioners. But nonetheless this agreement of 3/08/1983 also reiterates that the understanding between the petitioners was to seek pre-qualification and to bid for the works as joint venture group. But nonetheless this agreement of 3/08/1983 also reiterates that the understanding between the petitioners was to seek pre-qualification and to bid for the works as joint venture group. The contention of the learned Advocate General that this subsequent agreement of 3/08/1983 indicates that there was merely a technical collaboration agreement between the parties and not an arrangement in the real nature of joint venture agreement though appears to be attractive is with respect not well- founded for the obvious reason as indicated by us above that this may at the most amount to inter se division of the liabilities which will not be effective vis-a-vis the Government. If the petitioners were seeking pre-qualification as joint venture group which in deed they were since it is nobodys case that they were doing it as group of firms the authorities were obliged to consider the application in the correct legal perspective and in light of the guideline prescribed by the World Bank as well as the suggestions made by them from time to time. If there existed any doubt in the minds of the authorities that there was no clear indication about the commitment as a joint venture group though they were seeking pre-qualification as such they were supposed to seek clarifications in that behalf from the petitioners. It should be recalled that the guideline prescribed by the World Bank as noted by us in AFCONS case (supra) envisaged international competitive bidding for each work costing more than Rs. 7 crores and one of the important principles of this guideline was that all eligible bidders from developing and developed countries must have an opportunity to compete for the execution of the works. It is in light of this guideline that the World Bank authorities were slightly disturbed at the high percentage of the rejected joint venture consortia applicants and the omission on the part of the Standing Committee as well as Advisory Committee to seek for clarifications though in a number of such rejected cases there were capable parties of international repute. It was in light of this guideline and the large number of rejected applications of joint venture groups having capable parties that they suggested to review the cases and pre-qualify those joint venture consortia which included one or more firms able to perform the works. It was in light of this guideline and the large number of rejected applications of joint venture groups having capable parties that they suggested to review the cases and pre-qualify those joint venture consortia which included one or more firms able to perform the works. It appears that the Standing Committee as well as Advisory Committee which evolved a procedure for scrutiny of these applications completely lost sight of the legal parameters of the liabilities of co-venturers in 3 joint venture group vis-a-vis the customer in prescribing that individual parties to whom such of the responsibilities as are assigned were capable in their individual capacity to discharge them competently and satisfactorily. It appears from the grounds given in the report of the scrutiny in support of the conclusion not to pre-qualify the petitioners that the authorities rejected the application because in their opinion the first petitioner having assumed the sole responsibility of execution of the works had no experience in construction of large concrete dams though they have not stated it in sufficient clear terms. In any case to the extent to which they read this condition as an overriding factor ignoring the legal perspective of joint venture consortia which was an eligible entity for seeking pre-qualification and to bid for the works they had gone beyond the original eligible criteria prescribed by them. ( 17 ) THE learned Advocate General emphasised that the World Bank authorities have given their no-objection to the recommendations made by the Advisory Committee on 16/12/1984 inspite of their earlier suggestions contained in the telex massages of 16/07/1984 and 6/08/1984 The learned Advocate General also pointed out that after the aforesaid two telex messages the officers of the World Bank had come to India and examined the documents and other related information furnished by the parties seeking pre- qualification particularly of those parties who according to the recommendations of the Advisory Committee failed to pre-qualify. We do not think that the according of no-objection to the recommendations would make any difference since it would not cure the infirmity if any which had vitiated the recommendations of the Standing Committee and for that matter the Advisory Committee. In our opinion for the reasons which we have stated above the recommendations conveying the impugned decision not to pre-qualify for the reasons stated in the scrutiny report was vitiated and there- fore bad in law. In our opinion for the reasons which we have stated above the recommendations conveying the impugned decision not to pre-qualify for the reasons stated in the scrutiny report was vitiated and there- fore bad in law. ( 18 ) THE result is that this petition is allowed and a writ of certiorari be issued to quash and set aside the impugned decision of the respondents refusing to pre-qualify the petitioners for the construction of concrete dam across the Narmada river in Sardar Sarovar Project in Gujarat and we direct the respondents to treat the joint venture of the first and the 2nd petitioners as provisionally pre- qualified to bid for the works and accordingly to issue tender documents so as to enable them to submit their tender for the aforesaid works subject to the condition that the petitioners will make the needed organisational re-arrangement or legal commitments as required by the State Government in order to strengthen their qualifications and also without prejudice to the right of the State Government to withhold the approval when they submit their bids. Rule is made absolute accordingly with no order as to costs. No order on Civil Application. (ATP) petition allowed: Rule made absolute. .