JUDGMENT Arun Kuamr Goel, J. 1. Petitioner is aggrieved by conditions as contained in Annexures P-II and P-III. Annexurewise these conditions are extracted below: P-II (a) Who have successfully executed at least three works of similar class during the last three proceeding years for an aggregated amount of 1-1/4 times the amount put to tender provided that no work executed costing less than Rs. 30.00 lacs shall be considered. P-III 1(a)Who have successfully executed at least three works of similar class during three preceding years, the cost of each work shall not be less than 1/4th of the amount put to tender. 2. Above conditions could not have been put in the notice inviting tenders issued by the concerned Respondent. This clause being arbitrary unjust and illegal tantamounts to creating monopoly in favour of cartel of contractors and thus public interest suffers as a direct consequence of it. By referring to Annexure P-IV it was stated that the conditions like those in P-II and P-III supra were not incorporated by the Respondents, as such action of the Respondents regarding incorporation of the aforesaid conditions deserves to be struck down. In the absence of there being any policy guidelines etc. for inviting tenders for construction of roads under Prime Minister Grameen Sarak Yojna, hereinafter referred to as the Yojna, normal rules and regulations governing the contracts by H.P.P.W.D. will apply, wherein there is no such condition. Thus the writ needs to be allowed and condition supra in notices Annexures P-II and P-III quashed. 3. It was not disputed on behalf of the Respondents that Petitioner is a registered 'A' Class Contractor with HP P.W.D., thus he is entitled to bid in response to notices inviting' tenders upto any extent. Therefore, denial of tender documents to him on the basis of conditions (supra) in response to Annexures P-II and P-III is violative of Articles 14 and 19(1)(g) of the Constitution of India and be declared to be so. These conditions were otherwise bad because no other object was sought to be achieved except for allowing the work to be allotted at abnormally higher rates, that too, to some favourites. By referring to the instructions contained in the provisions for the registration of contractors in Himachal Pradesh, P.W.D., learned Senior Counsel pointed out that the so called pre-qualification mentioned in the aforesaid conditions cannot be upheld and may be struck down. By referring to the instructions contained in the provisions for the registration of contractors in Himachal Pradesh, P.W.D., learned Senior Counsel pointed out that the so called pre-qualification mentioned in the aforesaid conditions cannot be upheld and may be struck down. Further these conditions were never incorporated by the appropriate authority and Executive Engineer concerned had no jurisdiction to have issued any such tender incorporating those. By referring to documents placed on the file by the Respondents alongwith their reply, it was also urged that no benefit can be derived from those. Because those were not published in the name of Governor and in the same manner as notice was published. 4. All these pleas have been controverted by the learned Advocate General, who stated that it is the prerogative of the State to impose conditions, like those as in Annexures R-II and R-III. These are not justiciable unless shown to be arbitrary and unreasonable. Per him looking to the Yojna which is a Government of India sponsored scheme, whereunder the roads covered by P-Il and P-III are to be constructed laying of such conditions is meant to achieve object detailed in the said scheme. Price is one of the criterias to be kept in view, but according to the learned Advocate General it cannot be made the sole criteria to accept or reject a tender. He further pointed out that for the construction of roads under the Yojna work has to be carried out as per guidelines issued under it, i.e. the Yojna. Learned Advocate General further submitted that uniformed notices have been issued by the State of Himachal Pradesh under the aforesaid Yojna. Conditions supra are legal and valid per him and may be declared as such. 5. Sole question thus involved in this case is whether the conditions extracted from Annexures P-II and P-III could have been laid down by the Respondents while inviting tenders or not. Prima facie these conditions appear to be in the nature of pre-qualification. Learned Senior Counsel for the Petitioner stated that incorporation of these conditions cannot be upheld as according to him it denies the right of carrying on trade or business in favour of the Petitioner and other similarly placed persons. Prima facie these conditions appear to be in the nature of pre-qualification. Learned Senior Counsel for the Petitioner stated that incorporation of these conditions cannot be upheld as according to him it denies the right of carrying on trade or business in favour of the Petitioner and other similarly placed persons. Though they are otherwise eligible and are entitled to bid without any limit in case of tenders floated by the HP PWD being 'A' Class Contractor, but are being denied the benefit of participation in the tenders on the basis of the aforesaid clauses. 6. With a view to advance his this submission, reference was made by him to Rashbihari Panda Etc. v. State of Orissa 1969 (1) SCC 414, particularly its paras 17 and 18. These are extracted hereinbelow: 17. Validity of the schemes adopted by the Government of Orissa for sale of Kendu leaves must be adjudged in the light of Article 19(1)(g) and Article 14. Instead of inviting tenders the Government offered to certain old contractors the option to purchase Kendu leaves for the year 1968 on terms mentioned therein. The reason suggested by the Government that these offers were made because the purchasers had carried out their obligations in the previous year to the satisfaction of the Government is not of any significance. From the affidavit filed by the State Government it appears that the price fetched at public auctions before and after January, 1968, were much higher than the prices at which Kendu leaves were offered to the old contractors. The Government realised that the scheme of offering to enter into contracts with the old licensees and to renew their terms was open to grave objection, since it sought arbitrarily to exclude many persons interested in the trade. The Government then decided to invite offers for advance purchases of Kendu leaves but restricted the invitation to those individuals who had carried out the contracts in the previous year without default and to the satisfaction of the Government. By the new scheme instead of the Government making an offer, the existing contractors were given the exclusive right to make offers to purchase Kendu leaves. But in so far as the right to make tenders for the purchase of Kendu leaves was restricted to those persons who had obtained contracts in the previous year the scheme was open to the same objection. But in so far as the right to make tenders for the purchase of Kendu leaves was restricted to those persons who had obtained contracts in the previous year the scheme was open to the same objection. The right to make offers being open to a limited class of persons it effectively shut out all other persons carrying on tread in Kendu leaves and also new entrants into that business. It was ex facie discriminatory, and imposed unreasonable restrictions upon the right of persons other than existing contractors to carry on business. In our view, both the schemes evolved by the Government were violative of the fundamental right of the Petitioners under Article 19(1)(g) and Article 14 because the schemes gave rise to a monopoly in the trade in Kendu leaves to certain traders, and singled out other traders for discriminatory treatment. 18. The classification based on the circumstances that certain existing contractors had carried out their obligations in the previous year regularly and to the satisfaction of the Government is not based on any real and substantial distinction bearing a just and reasonable relation to the object sought to be achieved i.e., effective execution of the monopoly in the public interest. Exclusion of all persons interested in the trade, who were not in the previous year licensees is ex facie arbitrary, it had no direct relation to the object of preventing exploitation of pluckers and growers of Kendu leaves, nor had it any just or reasonable relation to the securing of the full benefit from the trade to the State. 7. When a reference is made to the facts of this case, it is clear that grant of licence for extraction in favour of previous year's licensees was held to be ex facie, arbitrary as there was no direct relation to the object of excluding of pluckers and growers of Kendu leaves. Similarly, it was also held that it had no just or reasonable relation to secure full benefit from the trade to the State. In this case Government having realised that the scheme of offering to enter into contracts with the old licensees and to renew their terms being open to grave objection and thereby it sought to arbitrarily exclude many persons interested in the trade. In this case Government having realised that the scheme of offering to enter into contracts with the old licensees and to renew their terms being open to grave objection and thereby it sought to arbitrarily exclude many persons interested in the trade. Thus the government decided to invite offers for advance purchase of Kendu leaves, but confined it to those individuals who had carried contracts in the previous years to the satisfaction of the Government. By this new scheme the existing contractors were given exclusive right to make offers for the purchase of Kendu leaves. Thus, offer was limited to few persons i.e. the existing contractors. 8. One of the grounds to challenge the grant of such contracts was that this was aimed by the Government with a view to help its party men. Para 14 of this judgment is relevant in this behalf which is also extracted hereinbelow: 14. It is urged by the Appellants that the machinery devised by the Government for sale of Kendu leaves in which they had acquired a monopoly to trade was violative of the fundamental rights guaranteed under Articles 14 and 19(1)(g) of the Constitution. It is said that the purchasers are merely nominees of the agents. It is also claimed that after this Court struck down a scheme under which the agents were to carry on business in Kendu leaves on their own account and to make profit for themselves, the Government with a view to help their party-men set up a body of persons who were to be purchasers to whom the monopoly sales were to be made at concessional rates and that the benefit which would have otherwise been earned by the State accrued to those purchasers. It is for this reason coupled with the fact that State could not give any explanation before the Supreme Court as to why an offer made by a well known manufacturer of Biri interested to purchase the entire crop of Kendu leaves for Rs. 3 crores was turned down for the year 1968. In these circumstances action of the Respondents was struck down. In view of the aforesaid circumstances this decision is on the facts of that case and thus cannot be read out of context. 9. 3 crores was turned down for the year 1968. In these circumstances action of the Respondents was struck down. In view of the aforesaid circumstances this decision is on the facts of that case and thus cannot be read out of context. 9. We may hasten to add here that Respondent-State in order to succeed have always to justify that incorporation of the clauses supra is reasonable, just and fair. 10. Reliance was also placed on behalf of the Petitioner on Rarnana Dayaram Shetty v. International Airport Authority of India and Ors. (1979) 3 SCC 489. What was held in para 12 and is relevant for this case is extracted herein below: 12. We agree with the observations of Mathew, J., in v. Punnan Thomas v. State of Kerala, that: The Government, is not and should not be as free as an individual in selecting the recipients for its largesse. Whatever its activity, the Government is still the Government and will be subject to restraints, inherent in its position in a democratic society. A democratic Government cannot lay down arbitrary and capricious standards for the choice of persons with whom alone it will deal. The same point was made by this Court in Erusian Equipment and Chemicals Ltd. v. State of West Bengal, where the question was whether black-listing of a person without giving him an opportunity to be heard was bad? Ray, C.J., speaking on behalf of himself and his colleagues on the Bench pointed out that black-listing of a person not only affects his reputation which is, in Poundian terms, an interest both of personality and substance, but also denies him equality in the matter of entering into contract with the Government and it cannot, therefore, be supported without fair hearing. It was argued for the Government that no person has a right to enter into contractual relationship with the Government and the Government, like any other private individual, has the absolute right to enter into contract with any one it pleases. It was argued for the Government that no person has a right to enter into contractual relationship with the Government and the Government, like any other private individual, has the absolute right to enter into contract with any one it pleases. But the Court, speaking through the learned Chief Justice, responded that the Government is not like a private individual who can pick and choose the person with whom it will deal, but the Government is still a Government when it enters into contract or when it is administering largesse and it cannot, without adequate reason, exclude any person from dealing with it or take away largesse arbitrarily. The learned Chief Justice said that when the Government is trading with the public, "the democratic form of Government demands equality and absence of arbitrariness and discrimination in such transactions. The activities of the Government have a public element and, therefore, there should be fairness and equality. The State need not enter into any contract with anyone, but if it does so, it must do so fairly without discrimination and without unfair procedure". This proposition would hold good in all cases of dealing by the Government with the public, where the interest sought to be protected is a privilege. It must, therefore, be taken to be the law that where the Government is dealing with the public, whether by way of giving jobs or entering into contracts or issuing quotas or licences or granting other forms of largesse, the Government cannot act arbitrarily at its sweet will and, like a private individual, deal with any person it pleases, but its action must be in conformity with standard or norms which is not arbitrary, irrational or irrelevant. The power or discretion of the Government in the matter of grant of largesse including award of jobs, contracts, quotas, licences, etc. must be confined and structured by rational, relevant and non-discriminatory standard or norm and if the Government departs from such standard or norm in any particular case or cases, the action of the Government would be liable to be struck down, unless it can be shown by the Government that the departure was not arbitrary, but was based on some valid principle which in itself was not irrational, unreasonable or discriminatory. 11. 11. So far legal proposition laid down was not disputed by the learned Advocate General, but he stated that this case is wholly inapplicable to the facts and circumstances of this case, keeping in view different clauses of the Yojna, Annexure R-V placed on record with the reply. 12. Next decision relied upon by Mr. Kanwar is Kasturi Lal Lakshmi Reddy, etc. v. The State of Jammu and Kashmir and Anr. AIR 1980 SC 1992, while dismissing the writ petition of the Petitioners challenging the action of the government in granting tapping contract by way of negotiations it was held to be not arbitrary or irrational. At the same time it was also held that the discretion of the Government is not unlimited in the matter of grant of largesses and such an Action must satisfy the test of reasonableness and public interest. According to learned Advocate General this decision supports the case of the Respondents keeping in view the Yojna whereunder the roads have to be constructed of particular specification within specific time frame. No escalation or extra cost is to be paid by the Central Government. Any such claim is payable by the State Government and quality of the road has to be such which does not call for a repair for a period of five years. 13. Reliance was placed by both sides on the decision in Tata Cellular v. Union of India 1994 (6) SCC 651. Reliance was placed by Shri Kanwar on paragraphs No. 70, 71, 77,81 and 94, which are extracted herein below: 70. It cannot be denied that the principles of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favouritism. However, it must be clearly stated that there are inherent limitations in exercise of that power of judicial review. Government is the guardian of the finances of the State. It is expected to protect the financial interest of the State. The right to refuse the lowest or any other tender is always available to the Government. But, the principles laid down in Article 14 of the Constitution have to be kept in view while accepting or refusing a tender. There can be no question ot infringement of Article 14 if the Government tries to get the best person or the best quotation. But, the principles laid down in Article 14 of the Constitution have to be kept in view while accepting or refusing a tender. There can be no question ot infringement of Article 14 if the Government tries to get the best person or the best quotation. The right to choose cannot be considered to be an arbitrary power. Of course, if the said power is exercised for any collatera purpose the exercise of that power will be struck down. 71. Judicial quest in administrative matters has been to find the right balance between the administrative discretion to decide matters whether contractual or political in nature or issues of social policy; thus they are not essentially justiciable and the need to remedy any unfairness. Such an unfairness is set right by judicial review. 77. The duty of the court is to confine itself to the question of legality. Its concern should be: 1. Whether a decision-making authority exceeded its powers? 2. Committed an error of law, 3. Committed a breach of the rules of natural justice, 4. reached a decision which no reasonable tribunal would have reached or, 5. abused its powers. Therefore, it is not for the court to determine whether a particular policy or particular decision taken in the fulfillment of that policy is fair. It is only concerned with the manner in which those decisions have been taken. The extent of the duty to act fairly will vary from case to case. Shortly put, the grounds upon which an administrative action is subject to control by judicial review can be classified as under: (i) Illegality: This means the decision-maker must understand correctly the law that regulates his decision-making power and must give effect to it. (ii) Irrationality, namely, Wednesbury unreasonableness. (iii) Procedural impropriety. The above are only the broad grounds but it does not rule out addition of further grounds in course of time. As a matter of fact, in R. v. Secretary of State for the Home Department, ex, Brind, Lord Diplock refers specifically to one development, namely, the possible recognition of the principle of proportionality. In all these cases the test to be adopted is that the court should, "consider whether something has gone wrong of a nature and degree which requires its intervention." 81. Two other facets of irrationality may be mentioned. In all these cases the test to be adopted is that the court should, "consider whether something has gone wrong of a nature and degree which requires its intervention." 81. Two other facets of irrationality may be mentioned. (1) It is open to the court to review the decision-maker's evaluation of the facts. The Court will intervene where the facts taken as a whole could not logically warrant the conclusion of the decision maker. If the weight of facts pointing to one course of action is overwhelming, then a decision the other way, cannot be upheld. Thus, in Emma Hotels Ltd. v. Secretary of State, for Environment, the Secretary of State referred to a number of factors which led him to the conclusion that a non-resident's bar in a hotel was operated in such a way that the bar was not an incident of the hotel use for planning purposes, but constituted a separate use. The Divisional Court analysed the factors which led the Secretary of State to that conclusion and, having done so, set it aside. Donaldson, L.J. said that he could not see on what basis the Secretary of State had reached his conclusion. (2) A decision would be regarded as unreasonable if it is impartial and unequal in its operation as between different classes. On this basis in R. V. Barnet London Borough Council, ex p Johnson the condition imposed by a local authority prohibiting participation by those affiliated with political parties at events to be held in the authority's parks was struck down. 94. The principles deducible from the above are: (1) The modern trend points to judicial restraint in administrative action. (2) The court does not sit as a court of appeal but merely reviews the manner in which the decision was made. (3) The court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible. (4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts. (4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts. (5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principle of reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides. (6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure. Based on these principles we will examine the facts of this case since they commend to us as the correct principles. (2) Whether the selection is vitiated by arbitrariness? 14. On the other hand, learned Advocate General placed reliance on what was held in paras 69 and 77. Those are also extracted for ready reference: 69. A tender is an offer. It is something which invites and is communicated to notify acceptance. Broadly stated, the following are the requisites of a valid tender: 1. It must be unconditional. 2. Must be made at the proper place. 3. Must conform to the terms of obligation. 4. Must be made at the proper time. 5. Must be made in the proper form. 6. The person by whom the tender is made must be able and willing to perform his obligations. 7. There must be reasonable opportunity for inspection. 8. Tender must be made to the proper person. 9. It must be of full amount. 15. A perusal of this decision nowhere lays down that condition of prequalification as aforesaid, suffers from any illegality and/or can be said to be either arbitrary or unreasonable. 16. Here reference to the guidelines as contained in Annexure R-V under Yojna need to be referred to. For the purpose of this writ petition relevant clauses are extracted below: 1.1 Rural Road Connectivity is not only a key component of Rural Development in India, it is also recognised as an effective poverty reduction programme. 16. Here reference to the guidelines as contained in Annexure R-V under Yojna need to be referred to. For the purpose of this writ petition relevant clauses are extracted below: 1.1 Rural Road Connectivity is not only a key component of Rural Development in India, it is also recognised as an effective poverty reduction programme. Notwithstanding the efforts made, over the years, at the State and Central Levels, through different Programmes, about 40% of the Habitations in the country are still not connected by All-weather roads. It is well known that even where connectivity has been provided, the roads constructed are of such quality that they cannot be categorised as All-weather roads. 2.4 The Rural Roads to be taken up will by and large, be surfaced roads (black topped/cement concrete), However, depending upon the soil conditions. All-weather roads may also be Gravel Roads, but with all necessary cross-drainage structures. 3.5 The DRDA will, thereupon, forward the Master Plan to the State-level Standing Committee, set up by the State Government (ideally headed by the Chief Secretary), to ensure close and effective monitoring of the Programme. Upon approval by the said Standing Committee, the project proposals would be forwarded by the State Government to the Ministry of Rural Development. 4.1 On clearance of the project proposals, the relevant projects would be executed by the PIUs and completed within a period of 9 months from the date of approval; in exceptional cases, this period may extend upto 12 months. Delayed execution of projects could also hold up further sanctions. 4.2 The well-established procedure for tendering through competitive bidding, would be followed for all projects. The projects would be tendered in packages of appropriate size (between Rs. 1 crore to Rs. 5 crores). 4.4 Time/Cost over-runs (and consequent cost escalations) will not be permitted and, in such an eventuality, the State Government concerned would have to bear the additional expenditure. To avoid such a contingency, the Executing Agency will incorporate suitable Penalty Clauses in the Contract. 4.5 The roads constructed under this Programme are expected to be of very high standard, requiring no major repairs for at least five (5) years after completion of construction. In order to realise this objective, suitable clauses relating to Performance Guarantee shall be included in the Contract Documents. 4.5 The roads constructed under this Programme are expected to be of very high standard, requiring no major repairs for at least five (5) years after completion of construction. In order to realise this objective, suitable clauses relating to Performance Guarantee shall be included in the Contract Documents. 4.8 The Ministry of Rural Development will indicate the design of a logo, road borders and all relevant information and these will be duly installed. 5.1 Quality of works being the essence of this programme, all works will be effectively supervised, it will be the prime responsibility of the PIU to make certain that the work done (and all the materials utilised in the same) conforms to the prescribed specifications. In addition to checking the quality of materials at site, the steps warranted in this direction should include: (i) Obtaining the Test certificates of manufactured materials from the sources from which these are procured. (ii) In the case of mineral aggregate, inspection of the quarry, (or even stationing a representative) to ensure that only approved rock is crushed to the required sizes. (iii) For works involving processing (i.e. stablisation or compaction involving equipment), requiring the contractor to do the work on a trial stretch so as to ensure that the equipment and procedures used turn out work of the highest quality. 5.2 Periodic inspections of works will be carried out by the Competent supervisory Authorities of the Executing Agency, it will be necessary for the Executing Agency to set-up Quality Control Units, independent of the PIU. 5.4 The Ministry of Rural Development will engage Independent Monitor, (Individuals Agency) for inspection of works under the Programme. It will be the responsibility of the PIU to facilitate the inspection of works by the Monitors, who shall be given free access to all records, administrative, technical and financial. 7.1 The Rural Roads constructed/upgraded under this Programme will be maintained by the concerned Panchayati Raj Institution (District Panchayat/Intermediate panchayat). The concerned Panchayati Raj Institutions would need to be identified while submitting the project for approval and the State Authorities will be required to furnish an Undertaking that they would remit (to the identified Panchayati Raj Institution), from the State Government funds, the requisite cost of maintenance. The State Governments will also offer an undertaking for the release of maintenance costs, alongwith their project proposals. The Ministry of Rural Development would oversee the implementation of this undertaking. The State Governments will also offer an undertaking for the release of maintenance costs, alongwith their project proposals. The Ministry of Rural Development would oversee the implementation of this undertaking. 8.1 For this year (2000-2001) only, funds under the Programme are being provided by the Centre to the States as Additional Central Assistance (ACA) and will follow the normal pattern of Additional Central Assistance. The Ministry of Rural Development will indicate the manner of release of funds, possibly including an "on line payment system" for the Programme from the next financial year. 8.5 The funds for the second Instalment will be released after fulfillment of procedures prescribed by the Ministry of Rural Development, which will include satisfactory reports from Independent Monitors engaged by the Ministry of Rural Development. For the year 2000-2001 alone, the Ministry of Rural Development may release the entire approved cost in one Instalment, subject to the total release being limited to the allocation for the State/UT. 8.6 The Head of the PIU, subject to not being below the rank of an Executive Engineer, will be competent to operate on this Account, subject to the normal rules and regulations of the State Government concerned. The funds earmarked for each Project are to be utilised for that project only. The Head of the PIU will send a Monthly Account to the Project Director, DRDA. The second instalment for each project will be claimed by the Project Director, DRDA, through the State Government. 9.3 All the road works will be subjected to Social Audit by way of discussion in the Gram Sabha. Relevant information in this regard will be made available to the Gram Sabha. State Governments will issue necessary instructions in this regard. 10.3 To maintain quality and ensure timely completion of works, the Ministry of Rural Development will lay down a scheme of incentives/disincentives to the States Districts. 17. In the face of these guidelines and looking to the quality of the roads which should not demand repair for five years, we feel that laying down of pre-qualification cannot be either said to be unjust or unreasonable. The purpose of laying down this condition is that people with adequate experience and standing in the field should only be allowed to participate in the tenders. The purpose of laying down this condition is that people with adequate experience and standing in the field should only be allowed to participate in the tenders. As such we feel that neither it creates any monopoly in favour of anyone nor it can be said to be arbitrary or unreasonable in any manner. While implementing the aforesaid scheme, it is not only the quality of road construction, but time frame has also to be kept in view. In fact after having gone through Annexure R-V, we are satisfied that there are enough in-built checks and balances to ensure that roads under it are efficiently constructed. 18. In this view of the matter, reliance placed on behalf of the Petitioner on New Horizons Limited and Anr. v. Union of India and Ors. 1995 (1) SCC 478, also does not improve his case. In this behalf Anr. submission urged by Mr. Kanwar by referring to Annexure P-V also needs to be examined. He pointed out that HP PWD while issuing a tender of the value of more than Rs. 70 lacs has not laid any such pre-condition, extracted hereinabove as contained in Annexures P-II and P-III. In this connection reference was also made by him to Annexure P-IV. This was a notice inviting tender issued by the Executive Engineer, P.W.D., Baijnath under the Yojna. He urged that on the basis of Annexures P-IV and P-V alone, this writ petition deserves to be allowed. 19. For the reasons to be recorded hereinafter, both these pleas need to be rejected. Vide his communication dated 24.1.2002, Chief Engineer (South), HP PWD had asked the Superintending Engineers as under: As you are well aware that the road works under PMGSY are important and of time bound nature. In order to have uniformity, it would be desirable to call the tenders with uniform Notice Inviting Tender for all circles. Accordingly, a Notice Inviting Tender and conditions regarding material, machinery, maintenance and plantation has been drafted in this office and are enclosed herewith for your perusal. The tenders under PMGSY work may therefore be invited accordingly and the conditions may also be added to the DNIT. All Executive Engineers under your circle be advised accordingly. 20. By referring to Annexure P-IV and the aforesaid communication, learned Advocate General explained that this was tender notice that was issued prior to the aforesaid communication of 24th January, 2002. The tenders under PMGSY work may therefore be invited accordingly and the conditions may also be added to the DNIT. All Executive Engineers under your circle be advised accordingly. 20. By referring to Annexure P-IV and the aforesaid communication, learned Advocate General explained that this was tender notice that was issued prior to the aforesaid communication of 24th January, 2002. When reference is made to Annexure P-II to P-III, we are satisfied that after 24.1.2002 notice inviting tenders were issued in a uniformal manner. Here reference to number of tenders issued vide Annexure R-III (Coll.) is important. A perusal of those clearly shows that conditions supra are there in all these tenders. In the face of this explanation we see no reason to accept the plea urged on behalf of the Petitioner. 21. So far Annexure P-V is concerned, it is a tender issued by HP PWD for construction of jeepable bridge over river Sutlej. We may point out that it has no relevance in the context of the construction of road, that too, under a specific scheme and as per the guidelines some of which have been extracted hereinabove. As such this annexure does not advance the case of the Petitioner in any manner whatsoever. 22. It was also pointed out by Mr. Kanwar that corrigendum issued vide Annexure R-VIII was not published in the same manner as notice inviting tenders were published. By means of this corrigendum Clause 'a' of Annexure P-III was slightly modified and its Clause 'b' was added. 23. In this behalf we may point out that these conditions have been uniformly notified in all tenders R-III in relation to the roads to be constructed under the Yojna elsewhere in the State issued by different divisions in the State. There is no disparity in the tenders floated under this Yojna after 24.1.2002. So far Annexure R-VIII is concerned, suffice it to say that Petitioner being a man of trade cannot be allowed to feign ignorance regarding its having been put on the notice board by the concerned Executive Engineer, as is pleaded by the Respondents in their reply. 24. Another point raised on behalf of the Petitioner was that the requirements of Article 299 of the Constitution of India has to be met with in the Government contracts from the issuance notice inviting tender till entering into the contract by the State. 24. Another point raised on behalf of the Petitioner was that the requirements of Article 299 of the Constitution of India has to be met with in the Government contracts from the issuance notice inviting tender till entering into the contract by the State. This plea was raised by Mr. Kanwar on two decision of the Supreme Court reported in State of Punjab and Ors. v. Om Parkash Baldev Krishan AIR 1988 SC 2149 and Sohan Lal (Dead) by L.Rs. v. Union of India and Anr. AIR 1991 SC 955. Both these decisions, in our considered view, do not advance the case of the Petitioner. 25. In the case of State of Punjab, (supra), letter of acceptance of contract was signed by the Executive Engineer, but not in the name of Governor. As such while dismissing the appeal of the State of Punjab, Supreme Court took the view that it could not said that there was a valid contract in conformity with Article 229(1) of the Constitution of India. 26. Similarly in the case of Sohan Lal, supra, it was held that where Plaintiff was unable to prove execution of contract of sale between him and the Government or the allottee, decree for specific performance could not be passed either against the government or allottee of disputed house. 27. In this context, suffice it to say that in response to notice inviting - tender, intending tenderers have submitted their offers. Those are to be finalised and after acceptance the question of entering into the contract would arise. So far Annexure P-III is concerned, it is admittedly issued in the name of the Governor, Annexure P-II has not been issued in the name of the Governor. Faced with this situation, learned Advocate General again referred to the communication dated 24.1.2002 and the proforma of notice inviting tenders attached with it. The said proforma is issued in the name of Governor and tenders were to be invited by Executive Engineer concerned. Per him this appears to be the result of 'printer's devil', as no benefit can be taken by the Petitioner from this omission. At the same time he argued that this omission does not in any manner vitiate the issuance of tender issued vide Annexure P-II. Reason being that challenge to Annexure P-II urged at the time of hearing was that it has not been issued in the name of Governor. At the same time he argued that this omission does not in any manner vitiate the issuance of tender issued vide Annexure P-II. Reason being that challenge to Annexure P-II urged at the time of hearing was that it has not been issued in the name of Governor. It is not case of the Petitioner that no such tender has been dated by the Governor See (1) R. Chitralekha In C.A. No. 1056 of 1963 (2) Venkatesubba Reddy In C.A. No. 1057 of 1963, Appellants v. State of Mysore and Ors. (In both the appeals) Respondents AIR 1964 SC 1823. 28. We may also notice here that in case the tender documents were issued to the Petitioner, then he was not aggrieved by the non issuance of Annexure P-II in the name of Governor. 29. Another plea urged on behalf of the Petitioner was that offers received by the Respondents in response to Annexures P-II and P-III are abnormally on higher side over and above the estimated value as contained in tender notices. This is only aimed at benefiting the members of the cartel, as detailed in the writ petition as also in para 16 of the rejoinder. 30. It cannot be said with certainty at this stage that whether these offers are going to be accepted or not, or whether Respondents are going to call all the bidders for negotiations or whether fresh tenders will be invited. Learned Advocate General in this behalf pointed out that the writ petition is maintainable on this plea.* And at the same time, he urged with vehemence that the Petitioner has no locus standi, muchless right to maintain this petition on any ground whatsoever Reference in this behalf can be made to R. Chitralekha etc., supra. 31. Scope of judicial review in the matter relating to tenders is concerned, it had been attending attention of the Supreme Court from time to time. Crux of all the decisions to which reference will be made hereinafter is that the Government cannot act like a private individual in the matter of floating of tenders, as well as grant of Government largesses. Its action must stand the test of judicial scrutiny atleast on the touch-stone of Article 14 of the Constitution of India. 32 In Sterling Computers Limited v. M. and N. Publications Limited and Ors. and Anr. Its action must stand the test of judicial scrutiny atleast on the touch-stone of Article 14 of the Constitution of India. 32 In Sterling Computers Limited v. M. and N. Publications Limited and Ors. and Anr. connected case 1993 (1) SCC 445, what was observed and is relevant for the present case is extracted hereinbelow: 12. At times it is said that public authorities must have the same liberty as they have in framing the policies, even while entering into contracts because many contracts amount to implementation or projection of policies of the Government. But it cannot be overlooked that unlike policies, contracts are legally binding commitments and they commit the authority which may be held to be a State within the meaning of Article 12 of the Constitution in many cases for years. That is why the courts have impressed that even in contractual matters the public authority should not have unfettered discretion. In contracts having commercial element, some more discretion has to be conceded to the authorities so that they may enter into contracts with persons, keeping an eye on the augmentation of the revenue. But even in such matters they have to follow the norms recognised by courts while dealing with public property. It is not possible for courts to question and adjudicate every decision taken by an authority, because many of the Government Undertakings which in due course have acquired the monopolist position in matters of sale and purchase of products and with so many ventures in hand, they can come out with a plea that it is not always possible to act like a quasi-judicial authority while awarding contracts. Under some special circumstances a discretion has to be conceded to the authorities who have to enter into contract giving them liberty to assess the overall situation for purpose of taking a decision as to whom the contract be awarded and at what terms. If the decisions have been taken in bona fide manner although not strictly following the norms laid down by the courts, such decisions are upheld on the principle laid down by Justice Holmes, that courts while judging the constitutional validity of executive decisions must grant certain measures of freedom of "play in the joints" to the executive. 13. But in normal course some rules must exist to regulate the selection of persons for awarding contracts. 13. But in normal course some rules must exist to regulate the selection of persons for awarding contracts. In such matters always a defence cannot be entertained that contract has been awarded without observing the well settled norms and rules prescribed, on basis of the doctrine of "executive necessity". The norms and procedures prescribed by Government and indicated by courts have to be more strictly followed while awarding contracts which have alongwith a commercial element a public purpose as in the present case. The publication of directories by the MTNL is not just a commercial venture; the primary object is to provide service to the people. 14. The action or the procedure adopted by the authorities which can be held to be State within the meaning of Article 12 of the Constitution, while awarding contracts in respect of properties belonging to the State can be judged and tested in the light of Article 14 of the Constitution, is settled by the judgments of this Court in the cases of Ramana Dayaram Shetty v. International Airport Authority of India, Kasturi Lal Lakshmi Reddy v. State of and K. Fertilizer Corporation Kamagar Union (Regd.) Sindri v. Union of India; Ram and Shyam Co. v. State of Haryana; Haji T.M. Hassan Rawther v. Kerala Financial Corporation Mahabir Auto Stores v. Indian Oil Corporation and Shrilekha Vidyarthi v. State of U.P. It has been said by this Court in Kasturi Lal : (SCC p. 13, para 14) It must follow as a necessary corollary from this proposition that the Government cannot act in a manner which would benefit a private party at the cost of the State; such an action would be both unreasonable and contrary to public interest. The Government, therefore, cannot for example, give a contract or sell or lease out its property for a consideration less than the highest that can be obtained for it, unless of course there are other considerations which render it reasonable and in public interest to do so. 17. It is true that by way of judicial review the court is not expected to act as a Court of appeal while examining an administrative decision and to record a finding whether such decision could have been taken otherwise in the facts and circumstances of the case. In the book Administrative Law, Prof. 17. It is true that by way of judicial review the court is not expected to act as a Court of appeal while examining an administrative decision and to record a finding whether such decision could have been taken otherwise in the facts and circumstances of the case. In the book Administrative Law, Prof. Wade has said: The doctrine that powers must be exercised reasonably has to be reconciled with the no less important doctrine that the court must not usurp the discretion of the public authority which Parliament appointed to take the decision. Within the bounds of legal reasonableness is the area in which the deciding authority has genuinely free discretion. If it passes those bounds, it acts ultra vires. The court must therefore, resist the temptation to draw the bounds too tightly, merely according to its own opinion. It must strive to apply an objective standard which leaves to the deciding authority the full range of choices which legislature is presumed to have intended. The decisions which are extravagant or capricious cannot be legitimate. But if the decision is within the confines of reasonableness, it is no part of the court's function to look further into its merits. 'With the question whether a particular policy is wise or foolish the court is not concerned; it can only interfere if to pursue it is beyond the powers of the authority. But in the same book Prof. Wade has also said: The powers of public authorities are therefore essentially different from those of private persons. A man making his will may, subject to any rights of his dependents, dispose of his property just as he may wish. He may act out of malice or a spirit of revenge, but in law this does not affect his exercise of his power. In the same way a private person has an absolute power to allow whom he likes to use his land, to release a debtor, or, where the law permits, to evict a tenant, regardless of his motives. This is unfettered discretion. But a public authority may do none of these things unless it acts reasonably and in good faith and upon lawful and relevant grounds of public interest. This is unfettered discretion. But a public authority may do none of these things unless it acts reasonably and in good faith and upon lawful and relevant grounds of public interest. There are many cases in which a public authority has been held to have acted from improper motives or upon irrelevant considerations, or to have failed to take account of relevant considerations, so that its action is ultra vires and void. 18. While exercising the power of judicial review, in respect of contracts entered into on behalf of the State, the Court is concerned primarily as to whether there has been any infirmity in the "decision making process". In this connection reference may be made to the case of Chief Constable of the North Wales Police v. Evans, where it was said that : (p. 144a) The purpose of judicial review is to ensure that the individual receives fair treatment, and not to ensure that the authority, after according fair treatment, reaches on a matter which it is authorised or enjoined by law to decide for itself a conclusion which is correct in the eyes of the court." By way of judicial review the court cannot examine the details of the terms of the contract which have been entered into by the public bodies or the State, Courts have inherent limitations on the scope of any such enquiry. But at the same time as was said by the House of Lords in the aforesaid case, Chief Constable of the North Wales Police v. Evans, the courts can certainly examine whether "decision making process" was reasonable, rational, not arbitrary and violative of Article 14 of the Constitution. 19. If the contract has been entered into without ignoring the procedure which can be said to be basic in nature and after an objective consideration of different options available taking into account the interest of the State and the public, then Court cannot act as an appellate authority by substituting its opinion in respect of selection made for entering into such contract. But, once the procedure adopted by an authority for purpose of entering into a contract is held to be against the mandate of Article 14 of the Constitution, the courts cannot ignore such action saying that the authorities concerned must have some latitude or liberty in contractual matters and any interference by court amounts to encroachment on the exclusive right of the executive to take such decision. 32. Before we part with the judgment we shall like" to strike a note of caution. It is a matter of common experience that whenever applications relating to awarding of contracts are entertained for judicial review of the administrative action, such applications remain pending for months and in some cases for years. Because of the interim orders passed in such applications, the very execution of the contracts, are kept in abeyance. The cost of different projects keep on escalating with passage of time apart from the fact that the completion of the project itself is deferred. This process not only affects the public exchequer but even the public in general who are deprived of availing the facilities under different projects. As such, it need not (sic) be impressed that while exercising the power of judicial review in connection with contractual obligations, courts should be conscious of the urgency of the disposal of such matters, otherwise the power which is to be exercised in the interest of the public and for public good in some cases become counterproductive by causing injury to the public in general. 33. In Delhi Science Forum and Ors. v. Union of India and Anr. and Anr. connected case (1996) 2 SCC 405, while dealing with the scope of judicial review in the matter of contract, it was held as under: 13. Section 7 enables the Central Government to make rules consistent with the provisions of the Act for the conduct of all or any telegraphs established, maintained or worked by the Government or by persons licensed under the said Act. Clause (e) of Sub-sections (2) of Section 7 prescribes that rules under the said section may provide for conditions and restrictions subject to which any telegraph line, appliance or apparatus for telegraphic communication shall be established, maintained, worked, repaired, transferred, shifted, withdrawn or disconnected. There is no dispute that no such rules have been framed as contemplated by Section 7(2)(e) of the Act. There is no dispute that no such rules have been framed as contemplated by Section 7(2)(e) of the Act. But in that event, it cannot be held that unless such rules are framed, the power under Sub-sections (1) of Section 4 cannot be exercised by the Central Government. The power has been granted to the Central Government by the Act itself, and the exercise of that right, by the Central Government, cannot be circumscribed, limited or restricted (sic by) any subordinate legislation to be framed under Section 7 of the Act. No doubt, it was advisable on the part of the Central Government to frame such rules when it was so desired by Parliament. Clause (e) to Sub-sections (2) of Section 7 was introduced by Amending Act 47 of 1957. If the conditions and restrictions subject to which any telegraph/telephone line, is to be established, maintained or worked, had been prescribed by the rules, there would have been less chances of abuse or arbitrary exercise of the said power. That is why by the Amending Act 47 of 1957 Parliament required the rules to be framed. But the question is as to whether it can be held that till such rules are framed Central Government cannot exercise the power which has been specifically vested in it by first proviso to Section 4(1) of the Act? Even in the absence of rules the power to grant licence on such conditions and for such considerations can be exercised by the Central Government but then such power should be exercised on well-settled principles and norms which can satisfy the test of Article 14 of the Constitution. If necessary for the purpose of satisfying as to whether the grant of the licence has been made strictly in terms of the proviso complying and fulfilling the conditions prescribed, which can be held not only reasonable, rational, but also in the public interest can be examined by courts. It need not be impressed that an authority which has been empowered to attach such conditions, as it thinks fit, must have regard to the relevant considerations and has to disregard the irrelevant ones. The authority has to genuinely examine the applications on their individual merit and not to promote a purpose alien to the spirit of the Act. It need not be impressed that an authority which has been empowered to attach such conditions, as it thinks fit, must have regard to the relevant considerations and has to disregard the irrelevant ones. The authority has to genuinely examine the applications on their individual merit and not to promote a purpose alien to the spirit of the Act. In this background, the courts have applied the test of reasonable man i.e. the decision should not be taken or discretion should not be exercised in a manner, as no reasonable man could have ever exercised. Many administrative decisions including decisions relating to awarding of contracts are vested in a statutory authority or a body constituted under an administrative order. Any decision taken by such authority or a body can be questioned primarily on the grounds: (i) decision has been taken in bad faith; (ii) decision is based on irrational or irrelevant considerations; (iii) decision has been taken without following the prescribed procedure which is imperative in nature. While exercising the power of judicial review even in respect of contracts entered on behalf of the Government or authority, which can be held to be State within meaning of Article 12 of the Constitution, courts have to address while examining the grievance of any Petitioner as to whether the decision has been vitiated on one ground or the other. It is well-settled that the onus to demonstrate that such decision has been vitiated because of adopting a procedure not sanctioned by law, or because of bad faith or taking into consideration factors which are irrelevant, is on the person who questions the validity thereof. This onus is not discharged only by raising a doubt in the mind of the court, but by satisfying the court that the authority or the body which had been vested with the power to take decision has adopted a procedure which does not satisfy the test of Article 14 of the Constitution or which is against the provisions of the statute in question or has acted with oblique motive or has failed in its function to examine each claim on its own merit on relevant considerations. Under the changed scenarios and circumstances prevailing in the society, courts are not following the rule of judicial self-restraint. Under the changed scenarios and circumstances prevailing in the society, courts are not following the rule of judicial self-restraint. But at the same time all decisions which are to be taken by an authority vested with such power cannot be tested and examined by the court. The situation is all the more difficult so far as the commercial contracts are concerned. Parliament has adopted and resolved a national policy towards liberalisation and opening of the national gates for foreign investors. The question of awarding licences and contracts does not depend merely on the competitive rates offered; several factors have to be taken into consideration by an expert body which is more familiar with the intricacies of that particular trade. While granting licences a statutory authority or the body so constituted should have latitude to select the best offers on terms and conditions to be prescribed taking into account the economic and social interest of the nation. Unless any party aggrieved satisfies the court that the ultimate decision in respect of the selection has been vitiated, normally courts should be reluctant to interfere with the same. 34. In Krishnan Kakkanth v. Government of Kerala and Ors. (1997) 9 SCC 495, while again dealing with a matter relating to distribution of State largesses, it was held that Government can depart from the set norms in favour of a particular group of persons provided that it was not irrational, unreasonable, discriminatory or arbitrary. Relevant paras of this judgment are extracted herein below: 26. After giving our careful consideration to the facts and circumstances of the case and submissions made by the learned Counsel for the parties, it appears to us that the fundamental right for trading activities of the dealers in pumpsets in the State of Kerala as guaranteed under Article 19(1)(g) of the Constitution has not been infringed by the impugned circular. Fundamental rights guaranteed under Article 19 of the Constitution are not absolute but the same are subject to reasonable restrictions to be imposed against enjoyment of such rights. Such reasonable restriction seeks to strike a balance between the freedom guaranteed by any of the clauses under Article 19(1) and the social control permitted by Clauses (2) to (6) under Article 19. 27. Such reasonable restriction seeks to strike a balance between the freedom guaranteed by any of the clauses under Article 19(1) and the social control permitted by Clauses (2) to (6) under Article 19. 27. The reasonableness of restriction is to be determined in an objective manner and from the standpoint of the interests of general public and not from the standpoint of the interests of the persons upon whom the restrictions are imposed or upon abstract consideration. A restriction cannot be said to be unreasonable merely because in a given case, it operates harshly and even if the persons affected be petty traders Mohd. Hanif v. State of Bihar. In determining the infringement of the right guaranteed under Article 19(1), the nature of right alleged to have been infringed, the underlying purpose of the restriction imposed, the extent and urgency of the evil sought to be remedied thereby, the disproportion of the imposition, the prevailing conditions at the time, enter into judicial verdict Laxmi Khandsari v. State of U.R. D.K. Trivediand Sons v. State of Gujarat and Harakchand Ratanchand Banthia v. Union of India. 28. Under Clause (1)(g) of Article 19, every citizen has a freedom and right to choose his own employment or take up any trade or calling subject only to the limits as may be imposed by the State in the interests of public welfare and the other grounds mentioned in Clause (6) of Article 19. But it may be emphasised that the Constitution does not recognise franchise or rights to business which are dependent on grants by the State or business affected by public interest Saghir Ahmad v. State of U.P. 29. It may be indicated that where a right is conferred on a particular individual or group of individuals to the exclusion of Ors. , the reasonableness of restrictions has to be determined with reference to the circumstances relating to the trade or business in question. Canalisation of a particular business in favour of specified individual has been held reasonable by this Court where vital interests of the community are concerned or when the business affects the economy of the country Parbhani Transport Co-op. Society Ltd. v. Regional Transport Authority; Shree Meenakshi Mills Ltd. v. Union of India and Lala Hari Chand Sarda v. Mizo Distt. Council. 30. Society Ltd. v. Regional Transport Authority; Shree Meenakshi Mills Ltd. v. Union of India and Lala Hari Chand Sarda v. Mizo Distt. Council. 30. It is true that even for imposing reasonable restriction on the fundamental right guaranteed under Article 19(1), the restriction is to be imposed under a valid law, be it a statutory law or a statutory regulation, and not by any executive instruction of the Government. (Kharak Singh case). 31. But in the instant case, no fundamental right guaranteed under Article 19(1)(g) of the Constitution has been infringed. Hence, question of invalidity on account of imposition of reasonable restriction on the exercise of such right by executive order instead of a statute does not arise in the facts of the case. 32. It may be indicated that although a citizen has a fundamental right to carry on a trade or business, he has no fundamental right to insist upon the Government or any other individual for doing business with him. Any Government or an individual has got a right to enter into contract with a particular person or to determine a person or persons with whom he or it will deal. 36. To ascertain unreasonableness and arbitrariness in the context of Article 14 of the Constitution, it is not necessary to enter upon any exercise for finding out the wisdom in the policy decision of the State Government. It is immaterial whether a better or more comprehensive policy decision could have been taken. It is equally immaterial if it can be demonstrated that the policy decision is unwise and is likely to defeat the purpose for which such decision has been taken. Unless the policy decision is demonstrably capricious or arbitrary and not informed by any reason whatsoever or it suffers from the vice of discrimination or infringes any statute or provisions of the Constitution, the policy decision cannot be struck down, it should be borne in mind that except for the limited purpose of testing a public policy in the context of illegality and unconstitutionality, courts should avoid "embarking on uncharted ocean of public policy". 35. In Raunaq International Ltd. v. I.V.R. Construction Ltd. and Ors. (1999) 1 492, while dealing with the matter relating to public interest in the award of Government contracts, what was held and is relevant for the present case is as under: 9. 35. In Raunaq International Ltd. v. I.V.R. Construction Ltd. and Ors. (1999) 1 492, while dealing with the matter relating to public interest in the award of Government contracts, what was held and is relevant for the present case is as under: 9. The award of a contract, whether it is by a private party or by a public body or the State, is essentially a commercial transaction. In arriving at a commercial decision, considerations which are of paramount importance are commercial considerations. These would be: (1) The price at which the other side is willing to do the work; (2) Whether the goods or services offered are of the requisite specifications; (3) whether the person tendering has the ability to deliver the goods or services as per specifications. When large works contracts involving engagement of substantial manpower or requiring specific skills are to be offered, the financial ability of the tenderer to fulfil the requirements of the job is also important; (4) the ability of the tenderer to deliver goods or services or to do the work of the requisite standard and quality; (5) past experience of the tenderer and whether he has successfully completed similar work earlier; (6) time which will be taken to deliver the goods or services; and often; (7) the ability of the tenderer to take follow-up action, rectify defects or to give post-contract services. Even when the State or a public body enters into a commercial transaction, considerations which would prevail in its decision to award the contract to a given party would be the same. However, because the State or a public body or an agency of the State enters into such a contract, there could be, in a given case, an element of public law or public interest involved even in such a commercial transaction. 11. When a writ petition is filed in the High Court challenging the award of a contract by a public authority or the State, the Court must be satisfied that there is some element of public interest involved in entertaining such a petition. If, for example, the dispute is purely between two tenderers, the court must be very careful to see if there is any element of public interest involved in the litigation. If, for example, the dispute is purely between two tenderers, the court must be very careful to see if there is any element of public interest involved in the litigation. A mere difference in the prices offered by the two tenderers may or may not be decisive in deciding whether any public interest is involved in intervening in such a commercial transaction. It is important to bear in mind that by court intervention, the proposed project may be considerably delayed thus escalating the cost far more than any saving which the court would ultimately effect in public money by deciding the dispute in favour of one tenderer or the other tenderer. Therefore, unless the court is satisfied that there is a substantial amount of public interest, or the transaction is entered into mala fide, the court should not intervene under Article 226 in disputes between two rival tenderers. 12. When a petition is filed as a public interest litigation challenging the award of a contract by the State or any public body to a particular tenderer, the court must satisfy itself that the party which has brought the litigation is litigating bona fide for public good. The public interest litigation should not be merely a cloak for attaining private ends of a third party or of the party bringing the petition. The court can examine the previous record of public service rendered by the organisation bringing public interest litigation. Even when a public interest litigation is entertained, the court must be careful to weigh conflicting public interests before intervening. Intervention by the court may ultimately result in delay in the execution of the project. The obvious consequence of such delay is price escalation. If any retendering is prescribed, cost of the project can escalate substantially. What is more important is that ultimately the public would have to pay a much higher price in the form of delay in the commissioning of the project and the consequent delay in the contemplated public service becoming available to the public. If it is a power project which is thus delayed, the public may lose substantially because of shortage in electricity supply and the consequent obstruction in industrial development. If it is a power project which is thus delayed, the public may lose substantially because of shortage in electricity supply and the consequent obstruction in industrial development. If the project is for the construction of a road or an irrigation canal, the delay in transportation facility becoming available or the delay in water supply for agriculture being available, can be a substantial setback to the country's economic development. Where the decision has been taken bona fide and a choice has been exercised on legitimate considerations and not arbitrarily, there is no reason why the court should entertain a petition under Article 226. 13. Hence before entertaining a writ petition and passing any interim orders in such petitions, the court must carefully weigh conflicting public interests. Only when it comes to a conclusion that there is an overwhelming public interest in entertaining the petition, the court should intervene. 14. Where there is an allegation of mala fides or an allegation that the contract has been entered into for collateral purposes and the court is satisfied on the material before it that the allegation needs further examination, the court would be entitled to entertain the petition. But even here, the court must weigh the consequences in balance before granting interim orders. 15. Where the decision-making process has been structured and the tender conditions set out the requirements, the court is entitled to examine whether these requirements have been considered. However, if any relaxation is granted for bona fide reasons, the tender conditions permit such relaxation and the decision is arrived at for legitimate reasons after a fair consideration of all offers, the court should hesitate to intervene. 16. It is also necessary to remember that price may not always be the sole criterion for awarding a contract. Often when an evaluation committee of experts is appointed to evaluate offers, the expert committee's special knowledge plays a decisive role in deciding which is the best offer. Price offered is only one of the criteria. The past record of the tenderers, the quality of the goods or services which are offered, assessing such quality on the basis of the past performance of the tenderer, its market reputation and so on, all play an important role in deciding to whom the contract should be awarded. Price offered is only one of the criteria. The past record of the tenderers, the quality of the goods or services which are offered, assessing such quality on the basis of the past performance of the tenderer, its market reputation and so on, all play an important role in deciding to whom the contract should be awarded. At times, a higher price for a much better quality of work can be legitimately paid in order to secure proper performance of the contract and good quality of work which is as much in public interest as a low price. The court should not substitute its own decision for the decision of an expert evaluation committee. 26. In the present case, it was submitted that the terms and conditions of the tender specified the requisite qualifying criteria before a person could offer a tender. The criteria which were so laid down could not have been relaxed because such a relaxation results in a denial of opportunity to Ors. . In support, the Respondents relied upon Ramana Dayaram Shetty v. International Airport Authority of India. In that case, the Court had held judicial review as a check on the exercise of arbitrary powers by the State and as a check on its power to grant largess. The court also observed that when the exercise of discretion is structured in terms of the tenders which have been invited, the discretion must be exercised in accordance with the norms as laid down. The same view has been taken by this Court in Premium Granites v. State of T.N., where this Court observed that where rational non-discriminatory norms have been laid down for granting of tenders, a departure from such norms can only be made on valid principles. These principles enunciated by this Court are unexceptional. 36. In Air India Ltd. v. Cochin International Airport Ltd. and Ors. and Anr. connected case 2000(2) SCC 617, in the matter relating to award of contract by State or its instrumentality, it was held as under: 11. These principles enunciated by this Court are unexceptional. 36. In Air India Ltd. v. Cochin International Airport Ltd. and Ors. and Anr. connected case 2000(2) SCC 617, in the matter relating to award of contract by State or its instrumentality, it was held as under: 11. This narration of facts makes it clear that all along, after the High Level Committee had recommended Cambatta for awarding the contract, what Cambatta was contending was that CIAL having accepted the limited global competitive bidding norms and having decided 28.7.1998 as the last date for inviting final offer, it was not open to it thereafter to negotiate with Air India behind the back of Cambatta and permit Air India to revise its offer. Even though Cambatta had written protest letters, it had not requested CIAL to give it any opportunity to negotiate or to improve upon its offer. The decision of the High Level Committee was obviously not the final decision and certainly it was not binding on the Board of Directors who were the final authority to take the decision. The Board of Directors, at the meeting held on 7.11.1998, considered the proposals of Air India and Cambatta and appeared to have taken a tentative decision to award the contract to Air India and, therefore, called it for negotiations with a view to have better terms and take the final decision. The Board of Directors did take the final decision on 27.11.1998 as Air India agreed to make its offer more beneficial to CIAL. That becomes apparent from Air 'India's letter dated 1.12.1998. The Board of Directors having taken a tentative decision on 7.11.1998 there was no point in calling Cambatta thereafter for any negotiation. It may be recalled that Cambatta was recommended over Air India by the High Level Committee only because Cambatta's financial rating was found higher. What is significant to note is that even the High Level Committee had in its minutes noted that financial rating cannot be the sole criterion for taking the final decision. Moreover, in a commercial transaction of such a complex nature a lot of balancing work has to be done while weighing all the relevant factors and the final decision has to be taken after taking an overall view of the transaction. Moreover, in a commercial transaction of such a complex nature a lot of balancing work has to be done while weighing all the relevant factors and the final decision has to be taken after taking an overall view of the transaction. It is true that even though Cambatta had called upon CIAL to produce the minutes of the meeting of the Board of Directors held on 27.11.1998 the same was not made available to Cambatta. But that did not entitle the High Court to draw any adverse inference. The High Court had not called upon CIAL to produce those minutes. 12. As regards the merits of Cambatta's proposal, it was contended by Mr. Andhyarujina that all the three offers of Cambatta were superior in terms of parameters laid down by CIAL than Air India's offer. He submitted that even after CIAL unilaterally raised the licence fee of Air India from 17 per cent to 20 per cent in the 10th year to match Cambatta's offer and imposed a condition that Air India would not sub-contract, it did not become comparable with the offer of Cambatta as Air India did not offer to pay 2 per cent bonus in licence fee. It was also submitted that Air India's representation that it would be able to bring more traffic was illusory and for that reason also Air India's proposal cannot be regarded as superior or even comparable with the proposal of Cambatta. We do not think that CIAL did any wrong in taking into consideration the fact that Air India is an airline and being a national carrier would be in a position to bring more traffic of Air India and other domestic airlines if it was awarded the contract. As regards the merits of the rival offers, we do not think it proper to look at only the financial aspect and hold that CIAL did not accept Cambatta's offer, even though it was better, because it wanted to favour Air India or that it had acted under the influence of Air India and the Ministry of Civil Aviation. In a commercial transaction of a complex nature what may appear to be better, on the face of it, may not be considered so when an overall view is taken. In such matters the court cannot substitute its decision for the decision of the party awarding the contract. In a commercial transaction of a complex nature what may appear to be better, on the face of it, may not be considered so when an overall view is taken. In such matters the court cannot substitute its decision for the decision of the party awarding the contract. On the basis of the material placed on record we find that CIAL bona fide believed that involving a public sector undertaking and a national carrier would, in the long run, prove to be more beneficial to CIAL. For all these reasons it is not possible to agree with the finding of the High Court that CIAL had acted arbitrarily and unreasonably and was also influenced by extraneous considerations during its decision-making process. 37. At the risk of repetition we may observe that looking to the source of the funds provided for construction of roads as per Yojna as mentioned in Annexures P-II, P-III and R-III (Coll.), it cannot be said that laying down of conditions extracted hereinabove in this judgment in any manner is either unjust or improper, muchless affecting of the rights claimed by the Petitioner. The object sought to be achieved by constructing roads under the aforesaid Yojna is to make rural road connectivity to all habitations. To ensure that this object is fulfilled, the aforesaid Yojna has been formulated. How to implement the programme of road construction, what has to be the constitution of the committees, execution of the works, besides supervision of work and quality control etc. should be there is clearly provided in the guidelines issued under the scheme. We further feel that for implementing these guidelines, laying of pre-qualification (supra), is perfectly legal and justified by the Respondents. 38. With a view to achieve the aforesaid object, people with particular experience have been called upon to apply in response to the tenders to which no exception can be taken, we may add here that but for insisting with vehemence that the Petitioner being 'A' Class Contractor, duly registered with the HP PWD can bid to any extent, learned Counsel for the Petitioner was not in a position to satisfy this Court as to in what manner the aforesaid conditions were either arbitrary or unjust. Nor is there any material placed on record to show that he has specialization and/or experience of road construction. 39. Nor is there any material placed on record to show that he has specialization and/or experience of road construction. 39. A Division Bench of this Court while dealing with the identical conditions (supra) in CWP 670 of 2001 Ram Narayan v. State of H.P. and Ors. upheld the same, Condition in this case was as under: 1. Tender form will be issued only to those contractors who have successfully executed three similar works of 1/4th magnitude of above works. 40. After following the decision in the case of Raunaq International Ltd. v. I.V.R. Construction Ltd. and Ors. supra while dismissing the writ petition, it was held as under: In the instant case, when a condition has been imposed regarding experience of similar works, it would be applicable to all persons similarly situated and it cannot be said that the Respondent-authorities in imposing it have acted arbitrarily or unreasonably. For the foregoing reasons, the petition deserves to be dismissed and is accordingly dismissed. Notice discharged. In the facts and circumstances, there will be no order as to costs. 41. Learned Senior Counsel for the Petitioner tried to argue that this decision is distinguishable and alternatively needs reconsideration by a larger Bench. After having gone through it and having given our thoughtful consideration, we feel that it squarely covers the present case and also does not call for reconsideration. 42. No other point is urged. 43. In view of the aforesaid discussion, there is no merit in this writ petition and the same is dismissed accordingly with no orders as to costs.