JUDGMENT 1. - The purchase of drugs and medicines by the Directorate of Medical and Health Services, Rajasthan, Jaipur for the various hospitals run by the State Government of Rajasthan is under challenge in the present batch of writ petitions inter alia on the grounds that after having invited tenders for drugs and medicines they are to be finalised as per the terms and conditions of the tenders and the policy of the Slate Government under its letter dated March 10, 1988 which came into force after inviting the tenders can have no application to the finalisation of the tenders ; that the policy is arbitrary and is in contravention of Article 19(g) of the Constitution of India ; that the price preference to the State undertakings, namely Rajasthan Drugs Pharmaceutical Ltd. (for short, RDPL) is not in public interest. 2. On August 13, 1987 a tender notice for the purchase of drugs and medicines for the period 1987-1989 was issued by the Director, Medical and Health Services (Family Welfare) for Rajasthan, Jaipur, (for short, the Director). Under the aforesaid tender notice medicines and surgical instruments were divided in parts A, B and C and each part was further divided in Sections A, B and C. We are presently concerned with the tenders for part `A'. The last date for submission of the tenders was September 26, 1987 and the date of opening the tenders was September 28, 1987. Somehow, the dates were changed and the last date for submission of the tenders was October 14, 1987 and the tenders were to be opened on October 16, 1987 at II am. The tenders have been invited from all the tenders or manufacturers who are public sector undertakings as well as private manufacturers. One of the writ petition (No. 697/88) has been filed by the Rajasthan Chemists Association and the members of the said association and other petitioners submitted their tenders for medicines of part `A'. The tenders were opened on the specified date and the case of the petitioners is that their rates were lowest whereas the rates quoted by RDPL and other public sector undertakings were on much higher sides. The tenders were not finalised for a period of four months and orders were given to RDPL for supply of 80 lacs Vitamin `A' Capsules i.e. I.U. worth Rs. 16 lacs approximately, at the rate of Rs. The tenders were not finalised for a period of four months and orders were given to RDPL for supply of 80 lacs Vitamin `A' Capsules i.e. I.U. worth Rs. 16 lacs approximately, at the rate of Rs. 20.50 per 100 capsules whereas the rates of Rs. 18.50 per 100 capsules were given by other tenders. It is further the case of the petitioners that on March 10, 1988 i e after almost 5 months of the opening of the tenders the State Government revised the policy for purchase of medicines. Earlier all the Drugs except for life saving drugs were purchased by inviting the tenders of rate contract and the tenders were granted to the manufacturers or their distributors whose quoted rates were the lowest but for the first time after inviting and opening the tenders the State Government revised the policy vide order dated March 10, 1988 and excluded the private pharmaceutical manufacturers and their distributors from the field of purchase of drugs which are being manufactured by the RDPL and other public sector undertakings for crores of rupees, and according to the petitioners the exclusion of private manufacturers and authorised dealers is arbitrary and not in public interest. 3. Notice of the writ petitions was given to the non-petitioners and reply has been filed. A reference to the reply shall be made as and when it is necessary but suffice to say that the tenders are said to have been bona fide ignoring the policy dated March 10, 1988 but it is admitted that before finalising the tenders orders were placed with RDPL. According to the non-petitioners the orders were placed to meet the urgent needs and due to the famine which acute in the State of Rajasthan and so far as the period for which the tenders have been invited the policy under order dated March 10, 1988 was not considered, though even earlier, there was a State policy to give preference to the public undertakings in the matter of purchase of medicines. 4. 4. Under the conditions of the tender notice a right is vested in the Directors who is the President of the Purchase Committee to reject all or any of the quotations without giving any reasons for the same A right is also vested in him to conclude, parallel, rate contract with another firm for the Stores detailed in the catalogue annexed with the tender notice. A reference in this connection may be made to clause 4 of the tender notice. With the object to regulate purchase and stores the Government has framed the Store Purchase Rules, (for short, the Rules) which came into force with effect from the financial year commencing from April 1, 1954. General Financial and Accounts Rules (for short, the GA and AR) and the Rules supplement the relevant provisions of GF and AR relating to `Stores' and `Contracts'. Under the scheme of the Rules all purchases for the department have to be arranged by a Committee who will invite tenders annually. Under rule 5, besides the Director of Medical and Health Services Rajasthan, Jaipur, who is the President of the Purchase Committee, the Dy. Secretary to Government (M and I H.D.), one Surgeon, one Physician, one officer possessing health qualifications and Accounts Officer in the Directorate of Medical and Health Services are the members of the purchase committee. The Members of the Committee have to be appointed by the Government on the recommendations of the Director, Medical and Health Services Rajasthan, Jaipur. The Secretary of the Store Purchase Section of the Directorate has to work as Secretary of the Committee and he or any gazetted officer deputed by the Director will be responsible for all the working of the Committee, preparation of comparative statements and maintenance of accounts etc. etc. He will however no power to discuss, to vote and to take part in deciding the names of the approved firms. Elaborate procedure has been given in the Rules for inviting and finalising of the tenders. Under rule 30 it is not binding on the Committee to accept the lowest tender. Ordinarily a lowest quotation is to be accepted, but as a matter of principle it is left entirely to the discretion of the Committee to accept the rates No reasons need be communicated to any competing tenderer when his tendered quotations have not been accepted by the Committee. Ordinarily a lowest quotation is to be accepted, but as a matter of principle it is left entirely to the discretion of the Committee to accept the rates No reasons need be communicated to any competing tenderer when his tendered quotations have not been accepted by the Committee. The Committee is acquired to record their reasons against the item in not selecting the lowest rates. In selecting the tender to be accepted, the respectability and financial status of the tendering firm or individual firm should be taken into consideration in addition to other relevant factors regarding his or their reputation established during the years in the department, etc. Under rule 33(a) the Stores Purchase Committee is fully competent to approve the articles and rates subject to the condition that in case rates higher than the lowest quotations arc approved the Committee shall assign and record specific reasons against each of such items to approve the higher rates in preference to the lowest rates. After approval of the purchase committee, it is the Director who has to communicate the names of approved suppliers to all officers concerned. 5. It has already been said earlier that the Rules are supplementary to the Rules framed under the GF and AR. Under rule 255 of the GF and AR also rules for purchase of the stores have been framed and aie contained in appendix XVI to the GF and AR In rule 3 of the aforesaid Rules it has been provided that as far as practicable tenders should be obtained (i) by advertisement (open tenders), (ii) by direct invitation to a limited number of firms (limited tenders), (iii) by invitation to one firm only (single tender or private purchase) and (iv) by negotiation. Then the Rules also provide what is meant by open tender system limited tender system, as well as single tender system and so far as negotiations are concerned, it is provided that they should be accepted in exceptional circumstances and some illustrations have also been given. A reference to the Rules has already been made earlier and generally it is through tender system that the rate contracts for drugs and medicines etc. are to be given. The rules are meant for only departmental use and have no statutory force. A reference to the Rules has already been made earlier and generally it is through tender system that the rate contracts for drugs and medicines etc. are to be given. The rules are meant for only departmental use and have no statutory force. Once the tenders have been invited, apart from the fact that a discretion is vested in the Director not to accept all or any of the tenders, the matter should be taken to its logical end and while finalising the tenders any policy of the State Government which came into force after the date on which the tenders v/ere opened cannot pressed into service and so far as the medicines etc. for which tenders arc called for, the matter is to be finalised as per the terms and conditions of the contract The Supreme Court in the case of Harminder Singh Arora v. Union of India and others, AIR 1986 SC 1527 , was dealing with a case where the tenders were invited for supply of fresh buffalo and cow milk. In para 27 of the judgment the court said that - "In the instant case, the instrumentalities of the State invited tenders for the supply of fresh buffalo and cows milk and, therefore, this case has to be decided on the basis of bid by the tenders There was no question of any policy in this case. It is open to the State to adopt a policy different from the one in question. But if the authority or the State Government chooses to invite tenders then it must abide by the result of the tender and cannot arbitrarily and capriciously accept the bid of respondent No. 4 although it was much higher and to the detriment of the State". The court also said that the contract for supply of milk was to be given to the lowest bider and there was no question of any policy decision in that case. Therefore, as per the above dicta of the Supreme Court there can. The court also said that the contract for supply of milk was to be given to the lowest bider and there was no question of any policy decision in that case. Therefore, as per the above dicta of the Supreme Court there can. be no doubt that once the Director invited the tenders for rate contracts of drugs and medicines in part `A' for the period 1987-1989 it could not have taken the policy of the State Government which came into force on March 10, 1988 in so far as the drugs other than the life saving drugs are concerned, as so far as life saving drugs are concerned, even earlier the State was not required to invite tenders but to place the indents of drugs with the public sector undertakings, in this RDPL. 6. Before we take up the question whether in this case while finalising the tenders the policy of the State Government dated March 10, 1988 has been taken into consideration or not, we would like to deal with the submission made by the learned counsel for the petitioners that under the State policy dated March 10, 1988 a monopoly has been created in favour of the public sector undertakings, and it is in contravention of Article 19(l)(g) of the Constitution of India. 7. The contention of the learned counsel for the petitioners is that the petitioners have a right to carry on any occupation, trade or business and that right of the petitioners can only be taken away by a statute. The State cannot take away that right merely by executive action. In this case, therefore, by laying down the policy under its order dated March 10, 1988, the State could not have given preference to the public-sector undertakings. Mr. M.I. Khan, learned Advocate General for the State as well as Mr. M.R. Calla, learned counsel for RDPL have contended that the executive power of the State under Article 162 of the Constitution of India is co-extensive with the legislative powers of the State. In the case of Bishambhar Dayal Chandra Mohan and others v. State of U.P., 1982(1) SCC 39 , the Supreme Court placing reliance on the case of Ramjawaya Kapur v. State of Punjab, AIR 1955 Sc 549 , said that the executive power is not capable of precise definition and is co-extensive with the legislative powers. In the case of Bishambhar Dayal Chandra Mohan and others v. State of U.P., 1982(1) SCC 39 , the Supreme Court placing reliance on the case of Ramjawaya Kapur v. State of Punjab, AIR 1955 Sc 549 , said that the executive power is not capable of precise definition and is co-extensive with the legislative powers. In the aforesaid case of Ram Jawaya Kapur (supra) Mukherjea dealt with the scope of Article 152 of the Constitution and it was observed that ordinarily the executive power connotes the residue of governmental functions that remains after legislative and judicial functions are taken away. In the case of Bishambhar Dayal (supra) the court observed that - "It is neither necessary nor possible to give an exhaustive enumeration of the kinds and categories of executive functions which may comprise both the formulation of the policy as well as its execution. In other words, the State in exercise of its executive power is charged with the duty and the responsibility of carrying on the general administration of the State. So long as the State Government does not go against the provisions of the Constitution or any law, the width and amplitude of its executive power cannot be circumscribed. If there is no enactment covering a particular aspect, certainly the Government can carry on the administration by issuing administrative directions or instructions, until the legislature makes a law in that behalf ". In the case of Ram Jawaya Kapur (supra) the court said that - "The executive function comprises both the determination of the policy as well as carrying it into execution. This evidently includes the initiation of legislation, the maintenance of order, the promotion of social and economic welfare, the direction of foreign policy in, fact the carrying on or supervision of the general administration of the State." The above principle laid down in the case of Ram Jawaya Kapur (supra) was reiterated by Bhagwati J. as he then was in the case of Naraindas Indurkha v. State of Madhya Pradesh and others, AIR 1974 SC 1232 , and it was held that the State Government could exercise its executive powers, even if there was no legislation to support such executive action. The Supreme Court in the case of Sarkari Sasta Anaj Vikreta Sangh v. State of M.P., 1981(4) SCC 471 , while dealing with the scheme established for fair price shops said that - "There is no other provision in the Order authorising the setting up of fair price shops or the making of a scheme for setting up fair price shops. On the other hand the State Government has undoubted competence ta make a scheme for setting up fair price shops and to set up fair price shops in pursuance thereof, in exercise of its executive power under Article 162 of the Constitution. The executive power of the State Government under Article 162 of the Constitution is coextensive with the legislative power of the State Legislature. Entry 33(b) of List III (Concurrent List) is `Trade and Commerce in, and the production, supply and distribution of foodsuffs, including edible oilseed and oils'. The Government therefore has the undoubted right to make a scheme for the distribution of foodstuffs, without being vested with any special authority under any order made under the Essential Commodities Act As already mentioned by us the Madhya Pradesh Foodstuffs (Distribution) Control Order, 1960 does not purport to vest any such power in the Government. It must, therefore, be taken that the Madhya Pradesh Foodstuffs {Civil Supplies Public Distribution) Scheme, 1981, was made in exercise of the executive power of the Government and not in exercise of any power delegated by a delegate under the Essential Commodities Act." In para 41 of the judgment, the court again said - "The fundamental right of traders like the petitioners to carry on business in foodstuffs without hindrance as dealers ; only, they could not run fair price shops as agents of the Government. No one could claim a right to run a fair price shop as an agent of the Government. All that he could claim was a right to be considered to be appointed as an agent of the Government to run a fair price shop. No one could claim a right to run a fair price shop as an agent of the Government. All that he could claim was a right to be considered to be appointed as an agent of the Government to run a fair price shop. If the Government took a policy decision to prefer cooperative societies for appointment as their agents to run fair price shops, in the light of the frustrating and unfortunate experience gat he' ed in the last two decades, we do not see how he can possibly hold that there was any discrimination" In the case of Brij Bhushan and others v. State of Jammu and Kashmir and others, 1986(2) SCC 354 , the State of Jammu and Kashmir had taken a policy decision not to allow the export of oleo resin from its territories but to give it only for industries set up within the State and scarcity price accordingly prevailed in the market. The said policy decision was taken under the executive orders and not under any Act. An argument was advanced that as a result of the aforesaid policy the monopoly was created in favour of the persons to whom the oleo resin was agreed to be given. The court said - "It is difficult to see how it can at all be contended that any monopoly was created in favour of respondents 2, 3 and 4 by the State Government by making the three impugned orders. The annual production of oleo resin in the State was in the neighbourhood of about 36,000 tonnes and out of them only 17,000 tonnes per annum were given to respondents 2, 3 and 4 and about 7000 tonnes were reserved for the units in the public sector, leaving as much as 12000 tonnes of oleo resin available for the other manufacturers. The petitioners and other manufacturers did, therefore, have about 12000 tonnes of oleo resin available for them. The petitioners and other manufacturers did, therefore, have about 12000 tonnes of oleo resin available for them. In the circumstances, no monopoly in regard to oleo resin could possibly be said to have been created by the State Government in favour of respondents 2, 3 and 4." The Supreme Court in the case of Sardar Sarup Singh and others v. State of Punjab and others, AIR 1959 SC 860 , said that the court cannot be called upon to embark on an enquiry into public policy or investigate into questions of political wisdom or even to pronounce upon motives of the legislature in enacting a law which it is otherwise competent to make. In the case of B.C. and Co. v. Union of India, AIR 1973 SC 106 , the Supreme Court said that unless the Government policy is mala fide, the court cannot adjudicate on it. 8. A reading of Article 162 of the Constitution of India will show that the executive power of the State is co-extensive with the legislative powers but, it is subject to the provisions of the Constitution. But in any matter with respect to which the legislature of a State and Parliament have power to make laws, the executive power of the State shall be subject to and limited by the executive power expressly conferred by the Constitution or by any law made by Parliament upon the Union or authorities thereof. It is well known that the industries in public sector play a very important role. Industries in public sector are established in public interest and to achieve the socialistic goal of the Constitution of India. They are established for production of reliable and quality products and to break the power of strangulation on economy which the industries in private sector may have developed and may be using to choke the industrial growth of the country. It is not uncommon that as when industries are established, an attempt is made by private sector to somehow see that industries in public sector do not succeed and therefore it is not uncommon that concessions might be provided to public sector to allow some breathing time or settling down time, as said by the Supreme Court in the case of Hindustan Paper Corpn. Ltd. v. Government of Kerala and others, 1986(3) SCC 398 . Ltd. v. Government of Kerala and others, 1986(3) SCC 398 . If concessions are not given to public sector industries atleast in the initial years, it may not be able to compete so for as the prices are concerned with the industries set up by private sector. The calling of tenders for supply of medicines for various departments of the Government is in fact a function of the Government and the State can take a policy decision for giving preference to the public sector undertakings, co-operative societies or others but such a decision can only be taken in public interest. The Government has to be reasonable and not arbitrary. We are therefore of the opinion that the State Government could take a policy decision that such of the products which are manufactured by public sector industries shall be purchased from them, but as already stated earlier, the purchase can only be in the larger public interest and this limb of the argument will be dealt with at the later stage of this order. It may also be stated that there is encroachment on the right of the petitioners to carry on any trade or business inasmuch as, as shall be presently shown, in the latter part of this order, a good number of medicines have been purchased from the private manufactures, either at the lowest rate of tenders or even at higher rates. That apart, except the purchases by the State Government for its hospitals and dispensaries etc. the entire market is left free and the petitioners are free to supply medicines to the general public. Therefore, Article 19(1)(g) of the Constitution is not contravened and on this count also the State policy which the State has power to lay down in respect of purchases for its hospitals and dispensaries in exercise of its powers, cannot be challenged and because it is not hit by any of the provisions of the Constitution, it is beyond the power of this court to adjudicate on the State policy except to the extent as aforesaid that. 9. 9. Before we take up the question whether the various tenders for various medicines have been accepted in accordance with the set norms, in accordance with store purchase rules, we will like to see whether while finalising the tenders so far as the medicines for which RDPL also submitted tenders, the State Policy dated March 10, 1988 has been acted upon or not ? or the tenders have been finalised on merits without taking into consideration the State policy. We have already said earlier that there cannot be any dispute that the State policy which came into force on March 10, 1988 cannot govern the acceptance of the tenders for various tenders for various medicines. We have sent for relevant files to satisfy us whether as alleged by the petitioners it is in the State policy dated March 10, 1988 the tenders of P.DPL have been accepted for various medicines. It may be stated that the last date for issue of tenders was October 14, 1987. When the writ petition was pending in this Court a submission was made on behalf of the petitioners that without any decision on the tenders submitted by them, purchases for huge amount has been made at the rates higher than those given by the petitioners. It may also be submitted on behalf of the petitioners that in the matter of taking decision in respect of tenders which had been invited prior to October 10, 1988 the policy decision contained in the order dated March 10, 1988 could not be made applicable. The court under its order dated May 25, 1988 directed that the State Government shall take a decision with regard to acceptance or rejection of the tenders which were invited in pursuance of the tender notice dated while taking such a decision the State Government shall not take into consideration the policy decision referred to in the order dated March 10, 1988. This Court, however, left open to make purchases of the drugs during the period till the decision is not taken on the tenders, but the said purchases shall only be made in accordance with the Store Purchase Rules and other Rules which are applicable. This Court, however, left open to make purchases of the drugs during the period till the decision is not taken on the tenders, but the said purchases shall only be made in accordance with the Store Purchase Rules and other Rules which are applicable. It further appears that the proceedings followed the acceptance of the tenders in accordance with the relevant rules and it is the Store Purchase Committee headed by the Director, Medical and Health Services which has to take final decision in the matter. The Director, Public and Health Services Rajasthan, Jaipur took a decision on October 15, 1987 and ordered, which order was later on approved by the Store Purchase Committee, that a committee be appointed to open and sign the tender received for drugs and medicines for the rate contract period from October I, 1987 to September 30, 1988. A committee headed by Dr. D.D. Neemawat, Addl. D.M. and H.S. was constituted under order dated October 15, 1987. That committee opened the tenders received. Thereafter, to scrutinise the criteria, a committee was appointed, which order was approved by the Store Purchase Committee. The Director, Medical and Health Services, under his order dated April 21, 1988 appointed the sub-committee of the officers with Dr S.N. Mishra, Principal, Head of the Department (Medicine) Medical College, Bikaner as its Chairman and the other members were Dr. V.D. Garg, Sr. Specialist (Medicine) Alwar, Dr. G.N. Sharma, State Lepoosy Officer met from time to time and submitted recommendations to the Store Purchase Committee and the Store Purchase Committee considered the recommendations of the Experts Sub-Committee on various dates and took several decisions and so far as the policy decision dated March 10, 1988 is concerned, the Store Purchase Committee in its meeting held on March 15/16, 1988 took the following decision - "Agenda Item. Policy for purchase of Drugs. Policy for purchase of Drugs. The directions of the Government regarding policy for purchase of drugs for Government Hospital/Medical Institution received vide letter No. F.7(7) MPB/81 dated 10.3.88 were perused by the S.P.C. and it was decided that Tenders of Drugs which were Manufactured by Public Sectors may not be considered and the Rate contract for 1987-89 for all other drugs may be finalised early." It will be clear that the aforesaid decision was taken by the Store Purchase Committee in its meeting which had taken place prior to May 25, 1988 when this Court had made an interim order which has been referred to earlier to the effect that while finalising the tenders the policy decision contained in the order dated March 10, 1988 shall not be taken into consideration. After the aforesaid decision of this Court on May 25, 1988 it appears that decision on March 15/16, 1988 in respect of tenders for drugs which were manufactured by the public sector undertakings was reviewed and the Store Purchase Committee in its meeting held on June 3, 4 and 7th, 1988 took a decision and the decision taken was as under : "In the S.P.C. meeting dated 15th and 16th March, 1988, it was decided to purchase of drugs from Public Sector Undertakings which are manufactured by them. The above decision was reviewed by the Committee in view of the decision of the Hon'ble High Court in D.B. Civil Writ Petition No. 1697/88 M/s Rajasthan Chemist Association, Jaipur v. State of Rajasthan and it was decided that the purchase policy of drugs may not be followed for the rate contract 1987-89 and Tenders of drugs and Medicines for rate contract period ending 30 9.89 may be finalised on merits and as per terms and conditions of the contract", In the said meeting after going into criteria/quality/rates of various drugs and medicines as per recommendation of Expert Sub-committee, the SP.C. has taken a decision and it is in the decision dated June 3, 4 and 1, 1988 that the S.P.C. approved the tenders of various items including the tenders of RDPL for as many as 24 items, 4 being the lowest and the rest on the basis of quality It may be stated that the tenders for not all such drugs and medicines for which RDPL had submitted tenders were approved and some tenders for medicines/drugs of RDPL were also rejected. It can therefore not be conclusively held on the basis of material that while finalising the tenders for the period October 1987 to September 30, 1989, the State policy dated March 10, 1988, was pressed into service. At the same time it cannot be said that during the period of the last date for receipt of tenders, their finalisation, purchases of more than two crores of rupees have been made and majority of the purchases has been made from RDPL and other public sector undertakings and the reason is said to be that there was brought in most of Rajasthan and to face the famine relief urgent purchases had to be made. We will deal with this aspect of the matter at the latter stage of this order. 10. Having said above that in finalising the tenders the State policy dated March 10, 1988 to the effect that such of the drugs/medicines which are manufactured by the public sector undertakings including RDPL should be purchased from those public sector undertakings, was not taken into consideration, it has to be seen whether the purchases from RDPL can be said to be in the public interest. 11. 11. There can be no dispute that while making the purchases of drugs/medicines for the Government run hospitals and dispensaries and even for private hospitals the emphasis should be on quality and not on the price of drugs/medicines. While insisting for the best quality of drugs/medicines endeavour should be made to secure them on competitive prices. The medicines for which lowest rates are quoted while submitting tenders are not necessarily of the best quality and that is why almost in all the notices inviting tenders as well as relevant rules, a discretion is vested in the competent authority to reject any tender or even to accept the tender at a higher rate but while accepting the tender and not accepting the same at a lower rate, some reasons must be assigned There can be no doubt that so far as various hospitals and dispensaries run by the State Government are concerned, medicines/drugs and other articles have to be purchased within the allocated budget and if the tenders of higher rates are accepted ignoring the lowest rates, less quantity of medicines/drugs will have to be purchased and it will not be possible to cater ever increasing number of patients on that account the quality of drugs/medicines and other articles cannot be ignored and it is for the Government to examine whether the rate contract system for supply of medicines/drugs to various hospitals and dispensaries is in the larger public interest or not and as shall be presently shown unless there are reasons in respect of quality etc. of drugs/medicines and other articles even in the rules or otherwise, the lowest tender should be accepted as the Government is expected to act fairly and reasonably and not arbitrarily, even in its administrative actions. The paramount consideration with the Government must be to purchase the best quality drugs and medicines etc. and it can hardly be disputed that some manufactures have over a period of time acquired a reputation and good- will and therefore even if they submit higher rates in the tenders for medicines/drugs, the Store Purchase Committee is satisfied that they are more reliable, their quality is beyond suspicion, it can purchase them notwithstanding the fact that somebody has quoted lower rates for any of the medicines/ drugs etc. 12. In the aforesaid back-ground while dealing with the relevant rules for the purchase of Stores which term includes medicines/drugs etc. 12. In the aforesaid back-ground while dealing with the relevant rules for the purchase of Stores which term includes medicines/drugs etc. we will examine the present cases. Apart from the fact that even in the notice inviting tenders in clause 4 it was clearly provided that the Director Medical and Health Services Rajasthan who will be the President of the Purchase Committee has a right to reject all or any quotation without giving any reason for the same and the relevant rules also provides the same. The law can be said to be settled that the discretion vested in the competent authority to accept or reject the tenders without assigning any reason is not arbitrary. In the case of State of Orissa and others v. Hari Narain, AIR 1972 SC 1816 , though there was power conferred on the Government to reject the tender without assigning any reason in para 17 of the judgment the court said that:- "Even apart from the power conferred on the Government under Sections 22 and 29, we fail to see how the power retained by the Government under clause (6) of its order dated January 6, 1971, can be considered as unconstitutional. As held by this Court in Converiee Bharucha's case, (supra) one of the important purposes of selling the exclusive right to sell liquor in wholesale or retail is to raise revenue." The court also said that while accepting or rejecting a bid, it is merely performing an executive function. The correctness of its conclusion is not open to judicial review. In the case of P.R. Quenim v. M.K. Tandal, AIR 1974 SC 651 . , in para 12 the court said that in matters relating to contracts with the Government, the latter is not bound to accept the tender of the person who offers the highest amount, and a condition like that contained in the tender notice is not violative of Article 14 of the Constitution of India. In the case of G. Ramhahu v. Zonal Manager, FCI, placing reliance on the above case of M.K. Tandel (supra) it was held that such a clause empowering the Government to accept or reject a bid without any reason is not arbitrary. It was also observed that such a power does not empower the Government to act arbitrarily, without reason. In the case of G. Ramhahu v. Zonal Manager, FCI, placing reliance on the above case of M.K. Tandel (supra) it was held that such a clause empowering the Government to accept or reject a bid without any reason is not arbitrary. It was also observed that such a power does not empower the Government to act arbitrarily, without reason. Thus, there can be no dispute that the Store Purchase Committee is not bound to accept the lowest tender and for the reasons to be stated and in the public interest and we may state that the purchase of best quality drugs shall be in public interest, the Store Purchase Committee can accept the higher rates in case it is satisfied about the reliability and quality of the drugs. 13. A reference has already been made in the earlier part of this order to Store Purchase Rules for Medical and Health department. Rule 30 of the aforesaid Rules is as under:- "It is not binding on the Committee to accept the lowest tender. Ordinarily a lowest quotation is to be accepted. As a matter of principle it is left entirely to the discretion of the Committee to accept the rates No reasons need be communicated to any competing tenderer when his tendered quotations have not been accepted by the Committee The Committee will record their reasons against the item in not selecting the lowest rates." Rule 31 of the Rules says that in selecting the tenders to be accepted, the respectability and financial status of the tendering firm or individual firm should be taken into consideration in addition to other relevant factors, regarding his or their reputation established during the years in the department etc. Under rule 33(a) the Stores Purchase Committee is full competent to approve the articles and rates subject to the condition that in case rates higher than the lowest quotations are approved the Committee shall assign and record specific reasons against each of such items to approve the higher rates in preference to the lowest rates. It will therefore be clear that a discretion is vested in the Stores Purchase Committee in the aforesaid Rules to approve the rates higher than the lowest quotation, but if it does so it must assign. It will therefore be clear that a discretion is vested in the Stores Purchase Committee in the aforesaid Rules to approve the rates higher than the lowest quotation, but if it does so it must assign. It has been contended by the learned counsel for some of the petitioners tint while accepting 22 items of RDPL a State undertaking and not accepting the lowest rates quoted by private tenderers, it is likely that the Government will loss about Rs. 90 lacs. An affidavit has been filed in D.B Civil Writ Petition No 1357/88, (M/s Chemitech Drugs Division v. State of Rajasthan wherein it has been stated that so far as items mentioned in the aforesaid affidavit are concerned, the public exchequer is being put to financial loss of nearly Rs. 12 lacs. It cannot be disputed that if higher rates of a tenderer are accepted, the public exchequer has to be a more and there can be no dispute that the State and public authorities must act fairly. Their action should be legitimate and nothing should be done by them which gives impression of bias, favouritism, and nepotism. But still there may be situations as in the present case where the tenders of drugs/medicines etc. in respect of which, as already stated earlier, quality and reliability, should be considered, the higher rates may be accepted, and if it is so, it cannot be said that the Stores Purchase Committee has not acted fairly and its actions are not legitimate and are not above board. It can also not be said that they smack of favouritism. 14. Though for number of items catelouged alongwith tender notice tenders for finalising the rates contracts were invited, but the tenders of 306 items were finalised and the rest of tenders were not accepted on the ground that those medicines/drugs are not required. RDPL quoted 43 items and 18 were rejected whereas 25 were accepted. In all out of 306 items, 280 from private firms and 26 from public sector undertakings including RDPL were accepted. It may also be stated that so far as RDPL is concerned higher rates for most of the items barring a few exceptions were accepted. RDPL quoted 43 items and 18 were rejected whereas 25 were accepted. In all out of 306 items, 280 from private firms and 26 from public sector undertakings including RDPL were accepted. It may also be stated that so far as RDPL is concerned higher rates for most of the items barring a few exceptions were accepted. In case of the private firms, and we may state that some of those firms are members of the Association in one of the writ petitions, the higher rates were approved by the Stores Purchase Committee on the ground of reliability and quality. We may further state that so far as the private firms are concerned, as per the information supplied by the State Government it appears that as many as 37 items on higher rates were approved We had also sent for the relevant registers wherein a comparative statement in respect of various items of various tenders received for those items have been mentioned and a perusal of those registers showed to us that the Expert Committee which was appointed by the Stores Purchase Committee against each item for which a higher rate than the lowest rate was accepted, had mentioned the reasons either of quality and/or reliability of the medicines. We have already referred to the Stores Purchase Rules and at the cost of repetition we may say that in case of approval of higher rates for drugs/medicines the Stores Purchase Committee was required to give reasons and the reasons have been stated by the Stores Purchase Committee in its meeting while it approved the higher rates. A look at various minutes of the Stores Purchase Committee will show that while approving the higher rate than lowest rates, it had given reason such as quality/reliability etc. The Stores Purchase Committee had considered the recommendations of the Expert Committee and thereafter a decision was taken by it. In its meeting held on June 3, 4 and 7th June, 1988, though the said meeting was held after passing of the stay order by this Court on May 25, 1988, various rates were approved and so far as RDPL is concerned, as many as 24 items were approved and out of them 4 on the ground that they were lowest and others on the quality basis. Similarly, some items of private firms also were approved on the basis of lowest rates and others of higher rates on the quality or reliability basis. We have already referred to the relevant Stores Purchase Rules and to its various clauses including clause 31 and at the cost of repetition we may say that in selecting the tenders to be accepted the respectability and financial status of the tendering firm or individual firm should be taken into consideration in addition to other relevant factors, regarding his or their established during the years in the department etc. So far as M/s Chemitech Drugs Division is concerned as per the decision taken earlier the said firm who had tendered earlier but not executed an agreement and did not supply drugs, their tenders will not be considered. A.S. Arora, partner of that firm already tendered for the period 1985-87, and he had given his tenders, but thereafter did not execute the agreement as tenders had been given without obtaining loan licence for manufacturing drugs. We are of the opinion that the Stores Purchase Committee in approving the higher rates not only of RDPL but also of private firms, as already stated, was merely governed by the quality of the medicines and respectability which the medicine had in the market, which it had acquired during the period. First the matter was considered by the Expert Committee which was approved by the Stores Purchase Committee which consisted of eminent doctors and it is that committee who took a decision as to which item of which firm including RDPL is of quality and has respectability. The matter was considered by the Stores Purchase Committee and then a decision was taken. Therefore, it is not a case where individual took a decision. There is also no allegation of any mala fide in any of the members of either Expert Committee or Stores Purchase Committee and the only ground urged is that some of the samples of RDPL were taken earlier and found to be below standard and there is no question of reliability of items for which the tenders given by RDPL are concerned. The circumstances under which the samples were found to be sub-standard have been explained by the RDPL and one of the reasons is that the samples were examined after long delay and were not kept as per requirements. The circumstances under which the samples were found to be sub-standard have been explained by the RDPL and one of the reasons is that the samples were examined after long delay and were not kept as per requirements. We are of the opinion that in the instant case, it cannot be said that the Stores Purchase Committee had rejected the tenders arbitrarily and had not acted in the public interest and has favoured RDPL in approving the items at a higher rate than the lowest quoted rates. We have already said that reliability and respectability and quality are considerations which appear to have governed the Stores Purchase Committee in approving higher rates for some of the items quoted and not accepting the lower rates. The action in approving the drugs/medicines on the basis of quality/reliability cannot be said to be without reason and it cannot be said to be against public interest, rather it is in the larger interest of public which must be provided the best medicines so as to avoid any untoward incident. 15. Consequently, we find no merit in any of the writ petitions which are hereby dismissed with no order as to costs.Writ petitions dismissed. *******