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2017 DIGILAW 600 (JHR)

Awadh Associates Pvt. Ltd. v. State of Jharkhand

2017-03-28

D.N.PATEL, RATNAKER BHENGRA

body2017
JUDGMENT : D.N. Patel, J. 1. This Letters Patient Appeal has been preferred against the Judgment and order delivered by the learned Single Judge in W.P.(C) No. 4940 of 2014 vide judgment and order dated 13th January 2015, whereby the petition preferred by this appellant was dismissed. The prayer of this appellant for quashing and setting aside the order dated 11th September 2014 of the Bid-scrutiny committee or Technical Committee (constituted by the State of Jharkhand for scrutiny of bid), which rejected the bid of this appellant. Being aggrieved and feeling dissatisfied by this Judgment and order, the original petitioner has preferred this Letters Patient Appeal. 2. FACTUAL MATRIX: Notice Inviting Tender was published on 14th August 2014 for grant of exclusive privilege, as envisaged under Section 22 of the Bihar Excise Act, 1915. hereinafter referred to as ' the Act, 1915', for the sake of brevity). Tender period was running from 1st October, 2014 to 31st March 2018. This appellant and the respondent no.7 and other bidders filled up the bids and have placed their respective offers for the district of East Singhbhum. This appellant was granted earlier exclusive privilege for manufacturing and supplying of country made liquor/spiced country made liquor, in bottles and sachets, initially for the period for 2002 to 2005, thereafter for 2005 to 2008 and 2008 to 2011. After the exclusive privilege is granted under Section 22 for manufacturing and supply of country made liquor/spiced country made liquor, everything went on smoothly by this appellant up to 2006 to 2007. In 2007-2008, no retail licences having been given to the retailers. This appellant (original petitioner) incurred losses as this appellant could not manufacture these items. Consequently it could not supply the same. After getting the exclusive privilege under Section 22, licence has to be obtained under Section 13, every year and the licence fee has to be paid by the person, who has got exclusive privilege. The Appellant (original petitioner) has to pay licence fees for the year 2007-08. The exclusive privilege period running from 2005-2008 was over and again for the next three years period i.e. for the period 2008 to 2011. Notice inviting tender was issued on 3rd April 2008. Again offers were made by several bidders and the appellant was given exclusive privilege. The Appellant (original petitioner) has to pay licence fees for the year 2007-08. The exclusive privilege period running from 2005-2008 was over and again for the next three years period i.e. for the period 2008 to 2011. Notice inviting tender was issued on 3rd April 2008. Again offers were made by several bidders and the appellant was given exclusive privilege. Letters have also been written by this appellant (original petitioner) that retail licences should be given, so that exclusive privilege can be exercised. Letter was written by the State of Jharkhand dated 18th November, 2008 (Annexure -10 to the rejoinder affidavit filed by the appellant) that retail licences have been given for the district East Singhbhum. Despite the retail licences were given in the district of East Shinbhum, on 8th December 2008, this appellant (original petitioner) withdrawn the consent. This letter is at Annexure - 11 to the rejoinder filed by the Appellant, in which it has been stated by this appellant that this appellant is withdrawing the consent, because it has become uneconomical and unviable for this appellant company and has prayed for refund of security amount also. The period of this exclusive privilege from 2008 to 2011 is over without manufacturing of country made liquor/spiced country made liquor. Another notice inviting tender was published by the Respondent-State of Jharkhand on 14th August 2014, in which there is a condition no.16, which is in Hindi and the same has been translated by the counsel for this appellant, which is as under. “If in the past five years in the capacity of a licensee, the excise license of a tenderer had been cancelled then his tender would not be considered. Every tenderer had to file an affidavit that there were no dues of excise revenue against him and that his working had been satisfactory. If in the State of Jharkhand or the other State where the tenderer is a licensee there are any dues against him and his working is not satisfactory, his tender would not be considered. Every tenderer had to file an affidavit that there were no dues of excise revenue against him and that his working had been satisfactory. If in the State of Jharkhand or the other State where the tenderer is a licensee there are any dues against him and his working is not satisfactory, his tender would not be considered. Even after acceptance of tender if any information is received about his working not being satisfactory or there being any kind of excise revenue dues against him then on failure to deposit the entire dues within the time limit fixed by the Excise Commissioner his tender would be cancelled” (Emphasis supplied) In pursuance of the aforesaid Notice Inviting Tender, again the bid was filled up by this appellant. Offer was made like earlier years by this appellant for manufacturing of country made liquor/spiced country made liquor, along with other bidders. As per Clause 16, this appellant's work was not found up to the mark of satisfaction in past. This appellant (original petitioner) was not considered for grant of the contract. A report was sought for from Assistant Commissioner of Excise. The same was given on 28th August 2014, which is at Annexure - 3 series to the Memo of this Letters Patent Appeal, in which it has been stated that: (a) This appellant was given exclusive privilege for manufacturing of liquor from 2005 to 2008, during this period, for the year 2006-07, the annual license fee was deposited, instead of March 2006, in the month of May 2006. (b) Similarly, the annual license fee for the year 2007-08, which was to be deposited in the month of march 2007, the same was deposited in the Month of September 2007, because of this, licence was given at a much belated stage under Section 13 of the Act, 1915. (c) Similarly the license fee, for the period, running from 1st August 2008 to 31st March 2011, exclusive privilege was granted to this appellant (original petitioner), but licence fees was not paid for the year 2008-2009, despite several reminders/notices given to this appellant (Original petitioner). Thereafter under Section 46 of the Act, 1915, management of manufacturing and supply of country made liquor was taken over and, to that effect, public advertisement was also given on 16th October 2009. Thereafter under Section 46 of the Act, 1915, management of manufacturing and supply of country made liquor was taken over and, to that effect, public advertisement was also given on 16th October 2009. Thus, looking to Clause 16 to the Notice Inviting Tender (Annexure – 2 to the Memo of this Letters Patent Appeal), and looking to the lapses done on behalf of this appellant (original petitioner), as pointed out by the Assistant Commissioner of Excise (Annexure – 3 series to the memo of Letters Patent Appeal), the Bid Scrutiny Committee or Technical Committee has found that the work of this appellant (original petitioner) is not satisfactory and hence, its offer was not accepted by the Respondent-State for granting exclusive privilege for the period 2014 to 2018. This decision is taken by the Bid Scrutiny Committee or Technical Committee on 11th of September 2014 (Annexure – 5 series to the Memo of this Letters Patent Appeal). Writ Petition Civil being WP(C) No. 4940 of 2014 was preferred by this appellant for quashing and setting aside the decision of the Bid Scrutiny Committee or Technical Committed dated 11th September 2014 . This writ petition was dismissed by the learned Single Judge vide order dated 13th January 2015 and hence, the present Letters Patent Appeal has been preferred by the original Petitioner. 3. ARGUMENTS CANVASSED BY COUNSEL FOR THE APPELLANT: Counsel appearing for the appellant submitted that exclusive privilege granted by the respondents-state to this appellant for the period running from 2008-2011 was, in fact, surrendered on 8th December 2008 by withdrawing the consent given by this appellant which tantamounts to the surrendering of the exclusive privilege and as no license was ever given under Section 13 of 'the Act 1915, such type of surrendering is always permissible in the eye of law. Looking to the detailed letter written by this appellant dated 18th December, 2008, which is at Annexure - 8 to the rejoinder affidavit filed by this appellant in this Letters Patent Appeal, it has been mentioned categorically that though the contract has been awarded in favour of this appellant, it has became uneconomical and unviable for this appellant to manufacture and supply of country made liquor/spiced country made liquor. In fact, for the previous year i.e. for the year 2007-08 also license fee was paid by this appellant and no retail license having been given by the Sate to anyone in the district of East Shinghbum in the State of Jharkhand, this appellant had to incur loses because the manufactured country made liquor cannot be sold out by this appellant to any one else, other than retail licence holders. For the year 2008-2009, the respondents demanded approximately Rs.47,00,000/- towards the licence fee and as the retail licences were given, as per the letter written by the Respondent-State on and from 18th November 2008 and as the licenses operate from 1st April 2008 onwards, most part of the year is already over and, therefore, it was not economical for this appellant to continue with the exclusive privilege. Against the order passed by the Deputy Commissioner of Excise, an appeal was preferred by this appellant before the Board of Revenue, who has decided the case in favour of this appellant with several observations about the conduct of the State. The said order is at Annexure - 4 to the Memo of this Letters Patent Appeal. It has been held by the Board of Revenue that as no licence was given by the Respondent-State under Section 13, this appellant (original petitioner) was not liable to make payment of licence fees. Nonetheless, as per the condition of the tender, the deposit was permitted to be forfeited by the Respondent-State. Counsel appearing for the appellant further submitted that the conduct of the respondents is not up to the mark of satisfaction. Retail licences were never given in the District of East Singhbhum and hence, there was some delay in making the payment of licence fees for the year 2007-2008 and that was the major reason for surrendering the exclusive privilege from 8th of December 2008, by withdrawing the consent and, therefore, as per the clause 16 of the Notice Inviting Tender dated 14th August 2014, it can not be said that the work of this appellant was not up to the mark of satisfaction. Therefore, the conclusion arrived at by the Scrutiny Committed dated 11th September 2014 (Annexure - 5 series) deserves to be quashed and set-aside, to the extent to which it affects the present appellant. Therefore, the conclusion arrived at by the Scrutiny Committed dated 11th September 2014 (Annexure - 5 series) deserves to be quashed and set-aside, to the extent to which it affects the present appellant. This aspect have not been properly appreciated by the learned Single Judge, while dismissing the writ petition preferred by this appellant and hence, the Judgment and order delivered by the learned Single Judge in WP(C) No.4940 of 2014 dated 13th January, 2015 deserves to be quashed and set-aside. Counsel for the appellant has relied upon the decisions, i.e. : (i) (1995)1 SCC 478 , (ii) (2005)5 SCC 598, (iii) (2013)6 SCC 573 , para 32, (iv) (1979)2 SCC 491 , (v) (2009)16 SCC 208 , (vi) (1994)2 SCC 387 and (vii) (2004)4 SCC 697. On the basis of the aforesaid decisions, it is submitted by the learned counsel for the appellant that the respondents-state cannot take advantage of its own wrong. The Exclusive Privilege could not be utilized at all for the year 2007-2008 and for most of the months of year 2008 i.e. from April to November 2008 and, hence, slight deviation in the payment of licence fees for the earlier years, cannot be treated by the Scrutiny Committee as “unsatisfactory performance of this appellant” for the period of exclusive privilege 2008-2011, as the consent was withdrawn on 8th December, 2008, which has a direct effect upon the use of the exclusive privilege. In fact, it tantamounts to surrendering of exclusive privilege, especially in absence of any licence granted to this appellant, there is no question of the payment of licence fee, whatsoever arises, more particularly, when Board of Revenue has decided this aspect of the matter in favour of this appellant. Counsel for the appellant has also taken this Court in detail, so far Bid Scrutiny Committee evaluation is concerned and it has been pointed out that in paragraph No.3, 4 and 5 of the said order dated 14th September 2014, M/s. Jenuine bottlers, district Garwha was found suitable for the grant of the contract and ultimately the contract was given to the respondent no. 7 M/s Kumar bottlers, Daltonganj, Palamau though as per the Notice Inviting Tender, which is at Annexure – 2 to Memo of this Letters Patent Appeal, specially looking to clauses 12 and 13, there was an essential condition about fire safety measures at the godown and for the insurance of the said godown, which were not complied with by the respondent No.7. Despite these defects, the contract has been given to Respondent No. 7. Counsel for the appellant has relied upon the decisions in Dr. Franklin Joseph Versus State of T.N. and others reported in (1994)2 SCC 387 and has pointed out that the respondents-state has followed the principle “Show me the man, I will show you the law”. Thus pick and choose method has been followed by the respondents-state. Counsel appearing for the appellant (original petitioner) has also pointed out that the order passed by the Members of the Board of Revenue, has attained its finality, which is dated 18th December, 2010 (Annexure - 4 to the Memo of this Letters Patent Appeal), in which it has been stated that this appellant (original petitioner) is not liable to make payment of licence fees for the period running from 2008 to 2009. Counsel for the appellant (original petitioner) has submitted that notice/demand was given by the Assistant Excise Officer, East Singhbhum, Jamshedpur dated 18th November, 2008 for payment of Rs.47,04,976/- as a licence fee for period running from 1st April, 2008 to 31st March 2009 and as this amount was a very huge amount, especially when, no retail licences were given up to the month of November, 2008, this appellant surrendered the exclusive privilege and hence, it cannot be said that the work of this appellant was not up to the mark of satisfaction. This aspect of the matter has not been properly appreciated by the scrutiny committee, while rejecting the Bid of this appellant vide order dated 11th September, 2014 (Annexure – 5 series to the Memo of this Letters Patent Appeal) as well as this aspect of the matter has also not been properly appreciated by the learned single judge, while dismissing the writ petition preferred by this appellant. Counsel appearing for the appellant has submitted that one Shri Ramji Prasad was initially given the exclusive privilege for the earlier years and he was inducted as a Director in this appellant's company, for which necessary procedure and permission has also been taken from the Commissioner of Excise, Bihar, Patna, on 16th April 2012, which is at Annexure - 1 to the Memo of this Letters Patent Appeal. Counsel for the appellant has relied upon, for this purpose, the decisions as rendered by the Hon'ble Supreme Court in the case of New Horizons Limited and another Vs. Union of India and others reported in (1995)1 SCC 478 , wherein the Judgment of Hon'ble Delhi High Court has been considered in para 39 thereof, i.e. 1994 (28) DRJ 425 . On the basis of the aforesaid decision, it has been pointed out by the learned counsel for the appellant that as per paragraph 23 of the aforesaid decision, whenever any member is inducted in the Company, specially as a director and is having individual experience as required under Notice Inviting Tender, the company, in which, such person has been inducted as a Director is always eligible for getting exclusive privilege. Counsel appearing for the appellant also submitted that if the order passed by the Scrutiny Committee dated 11th September 2014 is not quashed and set-aside, it will tantamount to permanent blacklisting of the appellant. This aspect of the matter has not been properly appreciated by the learned Single Judge, while dismissing the writ petition preferred by this appellant. 4. ARGUMENTS CANVASSED BY COUNSEL FOR THE STATE OF JHARKHAND: Counsel appearing for the state of Jharkhand has submitted that after getting the exclusive privilege under section 22 of 'the Act, 1915', this appellant has to take licence every year, as per Section 13 of the Act, 1915, for manufacturing and supplying of country made liquor/spiced country made liquor. It is submitted by the counsel for the State that Notice Inviting Tender was given in the month of April 2008 and along with several other bidders, this appellant participated and was given contract for manufacturing and supply of country made liquor/spiced country made liquor in bottles and sachets for the district of East Singhbhum. Thereafter, this appellant has to obtain licences for every year. Thereafter, this appellant has to obtain licences for every year. It is submitted by the counsel for the State that with all open eye and using all the wisdom and experience of a businessman, this appellant has taken a calculative risk of getting profit and has filled up the tender. He was given a contract. Exclusive privilege was also granted for the period 2008 to 2011. Retail licences were also given in the district of East Singhbhum, as per letter written by the respondents-state w.e.f. 12th November, 2008. The said letter is also on the record of this Letters Patent Appeal (Annexure -10 to the rejoinder filed by this appellant). Despite these facts, this appellant has withdrawn the consent vide letter dated 8th December 2008, which was received by the respondent on 10th December, 2008 (Annexure – 8 to the rejoinder filed by this appellant), mainly on the ground that now it has become uneconomical and unviable. Previously also for the year 2007-2008, this appellant had not deposited the licence fees in time, as has been stated by the Assistant Commissioner of Excise, in his report dated 28th August 2014 (Annexure - 3 series to the Memo of this Letters Patent Appeal). (a) Instead of depositing licence fee in the month of March 2006, it was deposited in the month of May 2006. (b) License fee, instead of depositing in the month of March 2007, for the next year, it was deposited in the month of September 2007. (C) Licence fee for the year 2008-09 has not been deposited, despite several notices and, hence, management of manufacturing and supply of country made liquor was taken over by the government vide order dated 19th March 2009 and by Memo No. 931 dated 20th April 2009 and vide Memo No. 2710 dated 16th October, 2009. This behaviour renders the work of this appellant as unsatisfactory and hence, clause16 of the Notice Inviting Tender dated 14th of August 2014 makes this appellant not eligible for grant of contract and this is, what has been observed by the Bid Scrutiny Committee in their evaluation report dated 11th September, 2014 and no error has been committed by the State Evaluation Committee in rejecting the bid of this appellant and hence, no error has also been committed by the learned Single Judge in dismissing this writ petition, preferred by this appellant. Counsel for the State has submitted that once the appellant has participated in the tender process for the year 2008-11 for grant of exclusive privilege under Section 22 of the Act, 1915, and when the exclusive privilege is also granted to this appellant for the aforesaid three years, this appellant cannot surrender the exclusive privilege without payment of licence fees for these three years and without compensating the loss caused to the State of Jharkhand, as per Section 44 of the Act, 1915 to be read with condition no. 5 (kha) of Notice inviting Tender (Annexure – 2 to the Memo of this Letters Patent Appeal). As per this clause, licence cannot be surrendered. If this clause is read with an explanation of Section 44(2) of the Act, 1915, the exclusive privilege cannot be surrendered by this appellant, without payment of licence fees and without compensating the losses caused to the respondent State and this type of surrendering of the exclusive privilege is also unsatisfactory work of this appellant, as per the clause 16 of the Notice Inviting Tender, which has resulted into rejection of bid of this appellant. This aspect of the matter has been properly appreciated by the Scrutiny Committee, while evaluating the bids, in their order dated 11th September 2014 and this aspect of the matter has also been properly appreciated by the learned Single Judge, while dismissing the writ petition preferred by this appellant and hence, this Letters Patent Appeal may not be entertained by this Court. When this appellant has taken a calculated risk, now, it cannot surrender the exclusive privilege under the excuse that retail licences were not given by the State of Jharkhand for the previous year 2007-2008 and only on the ground that it is uneconomical and not viable for this appellant. Commercial difficulties cannot be appreciated when terms of the Notice Inviting Tender are to be appreciated by this Court. It may happen that initially there can be a loss to the manufacture, but, later on, there can be a profit also. Profit or loss of every three months, or every one month or every one week cannot be calculated by this appellant. 5. ARGUMENTS CANVASSED BY COUNSEL FOR THE RESPONDENT NO. It may happen that initially there can be a loss to the manufacture, but, later on, there can be a profit also. Profit or loss of every three months, or every one month or every one week cannot be calculated by this appellant. 5. ARGUMENTS CANVASSED BY COUNSEL FOR THE RESPONDENT NO. 7: Counsel appearing for the respondent no.7 submitted that experience of a Member of the company is not an experience of the company at all, because the member of the company and the company are two different, distinct and separate personalities, otherwise, one of the members, who has became director in this appellant can also be a member of not less than five dozen company and even though, those company have no experience in manufacturing and supply of country made liquor of several varieties, will be entitled to get the contract. Two years experience is a must by the applicant, which this appellant is not having. Thus, experience of a member is not equal to experience of the company/applicant and this aspect of the matter, has been categorically noted in the bid evaluation committee, while rejecting the bid of the appellant in their order dated 11th September 2014 (Annexure – 5 series). Counsel appearing for the respondent no.7 placed heavy reliance upon the judgment and order delivered by the High Court of Delhi reported in 1994 (28) DRJ (DB) 425 and 1979 BBCJ 213 . Counsel appearing for the respondent no. Counsel appearing for the respondent no.7 placed heavy reliance upon the judgment and order delivered by the High Court of Delhi reported in 1994 (28) DRJ (DB) 425 and 1979 BBCJ 213 . Counsel appearing for the respondent no. 7 has also placed heavy reliance upon section 44 of the Act, 1915 and submitted that the exclusive privilege cannot be surrendered and has also placed reliance upon the explanation to Section 44(2) of the Act, 1915 and on the basis of this explanation, it is submitted that this appellant is a deemed licensor and Section 44 debars it from surrendering exclusive privilege granted to it, unless it makes the payment of full licence fees for the three years, i.e. 2008-2011 and unless it compensates the loss caused to the State and as this appellant has surrendered the exclusive privilege, this tantamounts to unsatisfactory work of this appellant and hence, no error has been committed by the bid scrutiny committee in rejecting the bid of this appellant, vide their order dated 11th September, 2014 and this aspect of the matter has been correctly appreciated by the learned Single Judge, while dismissing the writ petition preferred by this appellant and hence, this Letters Patent Appeal may not be entertained by this Court. Counsel for the respondent no. 7 has submitted that during previous year also, there was zigzag payment of the licence fees, which was not in time. This behaviour has already been pointed out by the Assistant Commissioner of Excise, in his report dated 28th of August 2014 (Annexure -3 series). This behaviour of the appellant, of the late payment of the licence fees also tantamounts to unsatisfactory working style of this appellant, as per clause 16 of the Notice Inviting Tender (Annexure – 2 to the Memo of this Letters Patent Appeal). After getting exclusive privilege for the period running from 2008-2011 and despite the fact that retail licences were given from November' 2008, the consent was withdrawn on 8th December, 2008 by this appellant, which tantamounts to surrendering of the exclusive privilege granted to this appellant under Section 22 of the Act, 1915. After getting exclusive privilege for the period running from 2008-2011 and despite the fact that retail licences were given from November' 2008, the consent was withdrawn on 8th December, 2008 by this appellant, which tantamounts to surrendering of the exclusive privilege granted to this appellant under Section 22 of the Act, 1915. Once this appellant has participated in the Notice Inviting Tender, for the exclusive privilege, for the period running from November 2008-2011 and once the exclusive privilege is also granted to this appellant, within three months or within three and half months, exclusive privilege was surrendered only on the ground that the business has become uneconomical and unit is not viable. This type of reasoning given by this appellant for surrendering of exclusive licence for the period running from 2008-2011, makes this appellant unfit for getting a contract for the period running from 2014 to 2018. Counsel appearing for the respondent no. 7 has relied upon the decisions renders by the Hon'ble Supreme Court reported in (2005)5 SCC 598 and (2013)2 SCC 565 . In view of these decisions and looking to the order passed by the Bid Evaluation Committee and looking to the order passed by the learned single judge in W.P.(C) No. 4940 of 2014, it is submitted by the counsel for the respondent no. 7 that no error has been committed by the learned single judge in dismissing the writ petition preferred by this appellant and hence, this Letters Patent Appeal may not be entertained by this Court. Counsel appearing for the respondent no. 7 has further submitted that in the contract matters and especially when the clauses of Notice Inviting Tenders are to be looked into, limited is the power of this Court for the judicial review. The learned counsel for the respondent no. 7 has relied upon the judgment and order renders by the Hon'ble Supreme Court reported in (2007) 14 SCC 517 and (2012) 6 SCC 467 (para15 to 22) and has submitted that this Letters Patent Appeal may not be entertained by this Court. 6. REASONS : Having heard counsel for both the sides and looking to the facts, reasons and judicial pronouncements, we see no reason to entertain this Letters Patent Appeal as there is no substance in this Letters Patent Appeal, mainly for the following facts and reasons. 6. REASONS : Having heard counsel for both the sides and looking to the facts, reasons and judicial pronouncements, we see no reason to entertain this Letters Patent Appeal as there is no substance in this Letters Patent Appeal, mainly for the following facts and reasons. (i) This appellant (original petitioner) was a successful bidder for getting exclusive privilege u/s 22 of the Bihar Excise Act, 1915 for manufacturing and supply of country made liquor/spiced country made liquor for the years 2003-2005 as well as for the years 2005-2008 and 2008-2011. For the ready reference, Section 22 of the Bihar Excise Act, 1915 reads as under : “22. Grant of exclusive privilege of manufacture and sale of country liquor or intoxicating drugs or denatured spirit or any other intoxicant. (1) The State Government may grant to any person, on such conditions and for such period as it may think fit, the exclusive privilege – (a)(i) of manufacturing or supplying wholesale or (ii) of manufacturing and supplying wholesale or (iii) of selling wholesale or retail or (iv) of manufacturing or supplying wholesale and selling retail; any country liquor or intoxicating drug with any specified local, or (b) of manufacturing, storing using, possessing, experting, importing including wholesale or retail sale of liquor which after manufacture is denatured to render it unfit for human consumption and is thereby termed as denatured spirit, and any other intoxicant: Provided that public notice shall be given of the intention to grant any such exclusive privilege and that any objection made by any person residing within the area affected shall be considered before an exclusive privilege is granted (2) No grantee of any privilege under s-s(i) shall exercise the same unless or until he has received a license in that behalf from the Collector or the Excise Commissioner”. (Emphasis supplied) (ii) After getting aforesaid exclusive privilege, one has to obtain a licence under Sections 13 and 20 of the Act 1915, as submitted by the counsel for both the sides. Sections 13 and 20 of the Act, 1915 reads as under: “13. Licence required for manufacture. – (a) No intoxicant shall be manufactured. (b) no hemp plant shall be cultivated. Sections 13 and 20 of the Act, 1915 reads as under: “13. Licence required for manufacture. – (a) No intoxicant shall be manufactured. (b) no hemp plant shall be cultivated. (c) no portion of the hemp plant from which and intoxicating drug can be manufactured or produced shall be collected, (d) no liquor shall be bottled for sale, (e) no distillery or brewery shall be worked, and (f) no person shall use, keep or have in his possession any materials, still, utensils, implement or apparatus whatsoever for the purpose of manufacturing any intoxicant other than tari, except under the authority and subject to the terms and conditions of a licence granted in that behalf by Collector: Provided that any tari producing tree may be tapped, and tari may be drawn from any tree without a licence under this section by the person in possession of the tree, (i) for the purpose of being used in the manufacture of gur or malasses, or (ii) for the purpose of being used solely for the preparation of food for domestic consumption and not – (a) as an intoxicant, or (b) for the preparation of any intoxicating article for sale, or (c) for the preparation of any article for sale, or (iii) up to a limit of four seers, for the domestic consumption of the said person.” “20. Licence required for sale. – No intoxicant and no portion of the hemp plant from which an intoxicating drug can be manufactured or produced shall be sold except under the authority and subject to the terms and condition of license granted in that behalf by the Collector: Provided as follows : (1) A licence for sale in more than one district shall be granted only by the Excise Commissioner or by a Collector specially authorized in that behalf of the Excise Commissioner. (2) A licence for sale granted under the Excise law in force in any other State may, on such conditions as may be determined by the Excise Commissioner, be deemed to be a licence granted under this Act. (2) A licence for sale granted under the Excise law in force in any other State may, on such conditions as may be determined by the Excise Commissioner, be deemed to be a licence granted under this Act. (3) A cultivator or owner of any hemp plant may sell without a licence, those portions of the plant from which an intoxicating drug can be manufactured or produced to any person licenced under this Act to deal in the same or to any officer whom the Excise Commissioner may authorize to purchase or receive the same. (4) No licence shall be required for any of the following sales namely: (a) the sale of foreign liquor lawfully procured by any person for his private use-when such sale is made by such person himself or on his behalf upon his quitting a station, or on behalf of his representation in interest after his decease; (b) the sale of tari lawfully possessed by a person in possession of the tree from which it was drawn, to a person licensed under this Act to manufacture or sell tari; (c) the sale of tari lawfully possessed and intended to be used in the manufacture of gur or molasses; or (d) the sale of tari lawfully possessed and intended to be used solely for the preparation of food for domestic consumption and not (i) as an intoxicant, or (ii) for the preparation of any intoxicating article, or (iii) for the preparation of any article for sale, or (e) the sale of tari lawfully possessed intended to be used in the manufacture of bread, to a person holding a permit to use tari for the purpose of making bread.” (iii) Licence under section 13 of the Act, 1915 is being given on year-wise basis, upon payment of licence fees. Section 44 of the Act, 1915 has been referred for more than once by counsel appearing for both the sides. For ready reference, Section 44 of the Act, 1915 reads as under: “44. Surrender of licence. Section 44 of the Act, 1915 has been referred for more than once by counsel appearing for both the sides. For ready reference, Section 44 of the Act, 1915 reads as under: “44. Surrender of licence. – (1) Any holder or a license granted under this act to sell an intoxicant may, unless his licence is liable to cancellation or suspension under section 42, surrender the same - (a) on the expiration of one month's notice in writing given by him to the Collector of his intention to surrender it, and (b) on payment of the fees payable for the licence for the whole period for which it would have been current but for such surrender: Provided that, if the Excise Commissioner is satisfied that there is sufficient reason for the surrender of licence, he may remit to the holder thereof the sum so payable on surrender, and any fees paid in advance or any portion of such sum or fees. (2) Subsection (i) shall not apply in the case of a licence for the sale of any country liquor or intoxicating drug in the exercise of an exclusive privilege granted under section 22. Explanation. The words “holder of a licence” as used in this section, include a person whose tender or bid for a licence has been accepted, although he may not actually have received the licence.” (Emphasis Supplied) (iv) For the years 2014-2018, notice inviting tender was published on 14th August, 2014 for grant of exclusive privilege for manufacturing and supply of country made liquor/spiced country made liquor. This appellant, respondent no. 7 and others offered for getting this contract. Thereafter, the scrutiny of the bids had taken place and the Bid Scrutiny Committee rejected the bid of this appellant vide note/minutes of the meeting/order dated 11th September, 2014 (Annexure -5 series to the memo of this Letters Patent Appeal). For ready reference, translated version in English of clause no. 16 of notice inviting tender reads as under, because on the basis of clause no. 16, the scrutiny committee has rejected the bid of this appellant : “Clause No. 16 : If in the past five years in the capacity of a licensee, the excise license of a tenderer had been cancelled then his tender would not be considered. 16 of notice inviting tender reads as under, because on the basis of clause no. 16, the scrutiny committee has rejected the bid of this appellant : “Clause No. 16 : If in the past five years in the capacity of a licensee, the excise license of a tenderer had been cancelled then his tender would not be considered. Every tenderer had to file an affidavit that there were no dues of excise revenue against him and that his working had been satisfactory. If in the State of Jharkhand or the other State where the tenderer is a licensee there are any dues against him and his working is not satisfactory, his tender would not be considered. Even after acceptance of tender if any information is received about his working not being satisfactory or there being any kind of excise revenue dues against him then on failure to deposit the entire dues within the time limit fixed by the Excise Commissioner his tender would be cancelled” (Emphasis supplied) (v) It has been observed by the Bid Scrutiny Committee that the working of this appellant was not satisfactory and hence, its bid was rejected. Being aggrieved and feeling dissatisfied by the aforesaid order, this appellant has preferred writ petition bearing W.P.(C) No. 4940 of 2014, which was dismissed by the learned Single Judge vide judgment and order dated 13th January, 2015 and hence, the original petitioner has preferred the present Letters Patent Appeal mainly on the ground that there was slight delay in making payment of licence fees for the earlier years, mainly on the ground that no retail licences were given for the district of East Singhbhum and even for the period, 2008-2011 up to November, 2008, no retail licence was given. This is the major contention in the whole argument canvassed by the counsel for the appellant and the State Government cannot take advantage of its own wrong. This contention raised by the counsel for the appellant is not accepted by this Court mainly for the reasons that for the period 2008-2011, exclusive privilege was given w.e.f. 1st of August, 2008 to 31st of March, 2011. This contention raised by the counsel for the appellant is not accepted by this Court mainly for the reasons that for the period 2008-2011, exclusive privilege was given w.e.f. 1st of August, 2008 to 31st of March, 2011. From November, 2008 retail licences were given in the district of East Singhbhum, as per communication of the respondent/state, which has been accepted by this appellant vide letter dated 8th December, 2008 (Annexure -8 to the memo of rejoinder affidavit filed by this appellant, Page 291 of this Letters Patent Appeal). For the previous year 2006-2007, licence fees which was to be deposited in the month of March, 2006 was deposited in the month of May, 2006, which was at approximately Rs.32,00,000/. Similarly, for the year 2007-2008, licence fees approximately Rs.33,60,736/, which was to be deposited in the month of March, 2007, was deposited in the month of September, 2007. A detailed report has been given by the Assistant Commissioner of Excise, Jamshedpur about the working style of this appellant, which is dated 28th August, 2014 (Annexure -3 series to the memo of this Letters Patent Appeal) because of the late payment of the licence fees, renewal of the licence was given at a much later stage. It ought to be kept in mind, lots of hue and cry made by this appellant that state has not given retail licence in the district of East Singhbhum for the year 2007-2008 and up to November, 2008, but, there is no grievance at all for not giving retail licence for the year 2006-2007, despite this fact, there was no payment of the licence fees in time. Similarly, even for the year 2008-2009, the retail licence were given from 12th November, 2008 and for no justifiable reason, this appellant has withdrawn his consent as per appellant's letter dated 8th of December, 2008 and thereby this appellant has surrendered the exclusive privilege and thereby now it is not paying the licence fees. Looking to the provisions of section 44 especially section 44(2) of the Act, 1915 to be read with explanation thereof, this appellant is a deemed licence holder and it cannot surrender its licence, even indirectly. Here, very cleverly this appellant has withdrawn his consent. Meaning thereby, it is surrendering his exclusive privilege for manufacturing and supply of “heavenly liquid ” and thereby, it is surrendering his licence. Here, very cleverly this appellant has withdrawn his consent. Meaning thereby, it is surrendering his exclusive privilege for manufacturing and supply of “heavenly liquid ” and thereby, it is surrendering his licence. A thing which cannot be done directly, can never be done indirectly. Thus, no error has been committed by the bid scrutiny committee in rejecting the bid of this appellant vide their minutes of meeting dated 11th September, 2014 (Annexure -5 series to the memo of this Letters Patent Appeal) and no error has been committed by the learned Single Judge in dismissing the writ petition bearing W.P. (C) No. 4940 of 2014 vide judgment and order dated 13th January, 2015. (vi) It further appears from the facts of this case that this appellant (original petitioner) is getting contract from 2003-2005, 2005-2008 and also for the year 2008-2011. Contract is given since last approximately one decade to this appellant. When any person is getting contract like this, he is always moving ahead with over confidence and he is always taking a business risk. Despite the fact that for the year 2007-2008, there was no retail licence given by the government and despite the fact that this appellant withdrawn his consent after getting exclusive privilege under section 22 of the Act 1915 and despite the lot of hue and cry about the loss caused to this appellant, it is further participating in the next notice inviting tender for the year 2014-2018. This appellant is taking calculative risk when this appellant is participating in 2014-2018 periods exclusive privilege bidding process. After being successful for the year 2008-2011 and when it has surrendered its exclusive privilege, again it is competing for the exclusive privilege for the year 2014-2018. This appellant knows its behaviour of nonpayment. This appellant also knows that, (a) it has not paid licence fees for the period 2006-2007 in time; (b) similarly, there was a delay in making payment of licence fees for the year 2007-2008; (c) exclusive privilege granted to this appellant for the year 2008-2011 was surrendered by it on 8th of December, 2008 after the retail licences were given in the district of East Singhbhum. This behaviour of the appellant is not up to the mark of satisfaction as per the Bid scrutiny Committee and therefore, as per clause 16 of the Notice Inviting Tender dated 14th August, 2014, for grant of exclusive privilege for the year 2014-2018, no error has been committed by the scrutiny committee in rejecting the bid of this appellant. Unsatisfactory work of this appellant for the previous years is a subjective satisfaction of the bid scrutiny committee. We are not sitting in appeal against the subjective satisfaction of the bid scrutiny committee. There was no mathematics for deciding satisfactory work and unsatisfactory work, nor is there any formula to arrive at a satisfactory work or unsatisfactory work. There is no hard and fast rule, for arriving at a satisfaction about the satisfactory work of this appellant. It ought to be kept in mind that looking to the behaviour of this appellant for the earlier years, no error has been committed by the bid scrutiny committee, much less by the learned Single Judge in rejecting the claim of this appellant for getting exclusive privilege for the year 2014-2018 under section 22 of the Act, 1915. For the manufacturing and supply of country made liquor/spiced country made liquor, the courts satisfaction cannot be replaced by the satisfaction of the Bid scrutiny Committee. Ultimately, this is a matter of grant of contract by the State. Enough and adequate opportunities have been given to public at large including this appellant. Appellant's case has also been scrutinized and ultimately, this appellant's work in the earlier years were not up to the mark of satisfaction. While exercising the power under Article 226 of the Constitution of India, of judicial review, we will be extremely slow in replacing our satisfaction because there is no mathematical formula, as stated herein above, to arrive at a conclusion by Bid-scrutiny Committee. This Court is not a chartered accountant or cost accountant or an economist. Contract depends upon the will and desire of both the parties. Prima facie, looking to the facts of the case, there was unsatisfactory work done by this appellant in the previous years. The decision of Bid-scrutiny Committee is not arbitrary. The decision of Bid-scrutiny Committee cannot be said to be baseless. Contract depends upon the will and desire of both the parties. Prima facie, looking to the facts of the case, there was unsatisfactory work done by this appellant in the previous years. The decision of Bid-scrutiny Committee is not arbitrary. The decision of Bid-scrutiny Committee cannot be said to be baseless. There were certain facts before the Bid-scrutiny Committee and based on those facts the Bid-scrutiny Committee arrived at the subjective satisfaction that previously the work of this Appellant was not upto the mark of satisfaction. Hence, looking to condition no. 16 of Notice Inviting Tender, bid of this Appellant was rejected. It is sufficient for this Court for examination of the decision taken by the Bid scrutiny Committee that there is no undue influence, fraud, misrepresentation etc. while taking decision by the bid scrutiny committee. Every now and then Court cannot replace the decision taken by the Bid-scrutiny Committee, even if, the second view is possible. (vii) Counsel appearing for the appellant has placed reliance upon an order passed by the Member, Board of Revenue, which is at Annexure -4 to the memo of this Letters Patent Appeal and has submitted that the behaviour of the State Government was not up to the mark of satisfaction. This contention is also not accepted by this Court mainly for the reasons that notice inviting tender and the bid scrutiny process is not for evaluation of the behaviour of the government, but, looking to the clause 16 of the notice inviting tender dated 14th August, 2014 (Annexure -2 to the memo of this Letters Patent Appeal) if there was unsatisfactory behaviour of this appellant and the performance of this appellant in the earlier years was not up to mark of satisfaction, its bid can be rejected. Approximately 1/4th of the argument of the appellant is upon the behaviour of the government with which we are not concerned at all. A person, who is interested in getting the contract and if he is finding too much faults of accepter or the offeree and especially, when there is unsatisfactory work on his own part, in the previous years, his bid is ought to be rejected. A person, who is interested in getting the contract and if he is finding too much faults of accepter or the offeree and especially, when there is unsatisfactory work on his own part, in the previous years, his bid is ought to be rejected. As stated herein above, this appellant is habitual in getting contract from the year 2003-2005 and 2005-2008, 2008-2011 and it has taken calculated risk for the year 2008-2011, despite there was no retail licence for the year 2007-2008 and therefore, for the year 2008-2011, he cannot surrender its exclusive privilege, looking to section 44(2) to be read with explanation thereof. (viii)It has been held by the Hon'ble Supreme Court in a case Jagdish Mandal Vs. State of Orissa & Others reported in (2007)14 SCC 517, para 17 to 22 reads as under:17. The learned counsel for the appellants submitted that the scope of interference in judicial review of tender processes and award of contracts is limited only to cases where there is material violation of the terms relating to scrutiny and acceptance of tenders or where the decision is vitiated either by arbitrariness/irrationality or by mala fides/favouritism. It was contended that as the fifth respondent failed to plead or make out any of these grounds in his writ petitions, the High Court ought not to have interfered with the contracts awarded to the appellants. 18. In the first case, it was contended that the decision of the Committee that the EMD was defective, was based on the communication dated 14-3-2005 of the Postal Authorities requiring the Committee not to take note of the TD passbook for Rs 1,70,000/- that the Postmaster General had also subsequently confirmed vide communications dated 30-3-2005 and 25-8-2005 that the TD passbook furnished by the fifth respondent was manipulated/forged and not to be acted upon; and that the High Court committed an error in ignoring the findings of the Postal Department, and in relying on an incomplete inquiry report of the officer in charge of the Junagarh Police Station, submitted during the pendency of the writ petition. Reliance is also placed on the reports placed by the State Government before this Court in pursuance of the order dated 4-9-2006 which showed that Rs. 1,70,000 was not deposited by the fifth respondent on 6-12-2004. 19. Reliance is also placed on the reports placed by the State Government before this Court in pursuance of the order dated 4-9-2006 which showed that Rs. 1,70,000 was not deposited by the fifth respondent on 6-12-2004. 19. In the second case, it was contended that the High Court had wrongly allowed the writ petition, without even referring to the facts or considering the contentions. It was submitted that the High Court ought to have considered the separate reasons given by the Committee for rejection of the tender of the fifth respondent, that is, quoting of unduly low rate for Item 19 and quoting a manipulated rate for Item 4. 20. The learned counsel for Respondents 1 to 4 broadly agreed with the contentions urged by the appellants. The fifth respondent, however, supported the reasoning of the High Court. On the contentions urged, the question that arises for consideration is whether the High Court in exercise of power of judicial review, was justified in quashing the award of the contract relating to first stretch to Jagdish Mandal and award of contract relating to second stretch to Laxman Sharma and directing reconsideration of tender. Scope of judicial review of award of contracts 21. We may refer to some of the decisions of this Court, which have dealt with the scope of judicial review of award of contracts. 21.1. In Sterling Computers Ltd. v. M & N Publications Ltd. this Court observed: (SCC p. 458, para 18) “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’. … the courts can certainly examine whether ‘decision-making process’ was reasonable, rational, not arbitrary and violative of Article 14 of the Constitution.” 21.2. In Tata Cellular v. Union of India this Court referred to the limitations relating to the scope of judicial review of administrative decisions and exercise of powers in awarding contracts, thus: (SCC pp. 687-88, para 94) “(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 action. 687-88, para 94) “(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 action. 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. … 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.” (emphasis in original) This Court also noted that there are inherent limitations in the exercise of power of judicial review of contractual powers. This Court also observed that the duty to act fairly will vary in extent, depending upon the nature of cases, to which the said principle is sought to be applied. This Court held that the State has the right to refuse the lowest or any other tender, provided it tries to get the best person or the best quotation, and the power to choose is not exercised for any collateral purpose or in infringement of Article 14. 21.3. In Raunaq International Ltd. v. I.V.R. Construction Ltd. this Court dealt with the matter in some detail. This Court held: (SCC pp. 500-01, paras 9-11) “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. This Court held: (SCC pp. 500-01, paras 9-11) “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. 10. What are these elements of public interest? (1) Public money would be expended for the purposes of the contract. (2) The goods or services which are being commissioned could be for a public purpose, such as, construction of roads, public buildings, power plants or other public utilities. (3) The public would be directly interested in the timely fulfilment of the contract so that the services become available to the public expeditiously. (4) The public would also be interested in the quality of the work undertaken or goods supplied by the tenderer. (3) The public would be directly interested in the timely fulfilment of the contract so that the services become available to the public expeditiously. (4) The public would also be interested in the quality of the work undertaken or goods supplied by the tenderer. Poor quality of work or goods can lead to tremendous public hardship and substantial financial outlay either in correcting mistakes or in rectifying defects or even at times in redoing the entire work—thus involving larger outlays of public money and delaying the availability of services, facilities or goods, e.g. a delay in commissioning a power project, as in the present case, could lead to power shortages, retardation of industrial development, hardship to the general public and substantial cost escalation. 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. 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.” 21.4. In Air India Ltd. v. Cochin International Airport Ltd. this Court summarised the scope of interference as enunciated in several earlier decisions thus: (SCC pp. 623-24, para 7) “7. … 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 paramount are commercial considerations. The State can choose its own method to arrive at a decision. 623-24, para 7) “7. … 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 paramount are commercial considerations. The State can choose its own method to arrive at a decision. It can fix its own terms of invitation to tender and that is not open to judicial scrutiny. It can enter into negotiations before finally deciding to accept one of the offers made to it. Price need not always be the sole criterion for awarding a contract. It is free to grant any relaxation, for bona fide reasons, if the tender conditions permit such a relaxation. It may not accept the offer even though it happens to be the highest or the lowest. But the State, its corporations, instrumentalities and agencies are bound to adhere to the norms, standards and procedures laid down by them and cannot depart from them arbitrarily. Though that decision is not amenable to judicial review, the court can examine the decision-making process and interfere if it is found vitiated by mala fides, unreasonableness and arbitrariness. The State, its corporations, instrumentalities and agencies have the public duty to be fair to all concerned. Even when some defect is found in the decision-making process the court must exercise its discretionary power under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the court should intervene.” 21.5. In Assn. of Registration Plates v. Union of India this Court held: (SCC p. 700, para 43) “43. … Article 14 of the Constitution prohibits the Government from arbitrarily choosing a contractor at its will and pleasure. It has to act reasonably, fairly and in public interest in awarding contract. At the same time, no person can claim a fundamental right to carry on business with the Government. All that he can claim is that in competing for the contract, he should not be unfairly treated and discriminated, to the detriment of public interest.” 21.6. It has to act reasonably, fairly and in public interest in awarding contract. At the same time, no person can claim a fundamental right to carry on business with the Government. All that he can claim is that in competing for the contract, he should not be unfairly treated and discriminated, to the detriment of public interest.” 21.6. In B.S.N. Joshi & Sons Ltd. v. Nair Coal Services Ltd. this Court observed: (SCC p. 568, para 56) “56. It may be true that a contract need not be given to the lowest tenderer but it is equally true that the employer is the best judge therefor; the same ordinarily being within its domain, court’s interference in such matter should be minimal. The High Court’s jurisdiction in such matters being limited in a case of this nature, the Court should normally exercise judicial restraint unless illegality or arbitrariness on the part of the employer is apparent on the face of the record.” 22. Judicial review of administrative action is intended to prevent arbitrariness, irrationality, unreasonableness, bias and mala fides. Its purpose is to check whether choice or decision is made “lawfully” and not to check whether choice or decision is “sound”. When the power of judicial review is invoked in matters relating to tenders or award of contracts, certain special features should be borne in mind. A contract is a commercial transaction. Evaluating tenders and awarding contracts are essentially commercial functions. Principles of equity and natural justice stay at a distance. If the decision relating to award of contract is bona fide and is in public interest, courts will not, in exercise of power of judicial review, interfere even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. The power of judicial review will not be permitted to be invoked to protect private interest at the cost of public interest, or to decide contractual disputes. The tenderer or contractor with a grievance can always seek damages in a civil court. Attempts by unsuccessful tenderers with imaginary grievances, wounded pride and business rivalry, to make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade courts to interfere by exercising power of judicial review, should be resisted. The tenderer or contractor with a grievance can always seek damages in a civil court. Attempts by unsuccessful tenderers with imaginary grievances, wounded pride and business rivalry, to make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade courts to interfere by exercising power of judicial review, should be resisted. Such interferences, either interim or final, may hold up public works for years, or delay relief and succour to thousands and millions and may increase the project cost manifold. Therefore, a court before interfering in tender or contractual matters in exercise of power of judicial review, should pose to itself the following questions: (i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone; OR Whether the process adopted or decision made is so arbitrary and irrational that the court can say: “the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached”; (ii) Whether public interest is affected. If the answers are in the negative, there should be no interference under Article 226. Cases involving blacklisting or imposition of penal consequences on a tenderer/contractor or distribution of State largesse (allotment of sites/shops, grant of licences, dealerships and franchises) stand on a different footing as they may require a higher degree of fairness in action. (Emphasis Supplied) (ix) It has been held by the Hon'ble Supreme Court in a case Tejas Constructions and Infrastructure Private Limited Vs. Municipal Council Sendhwa and Another reported in (2012)6 SCC 464 in paragraph 15 to 20 which reads as under: 15. A challenge to the award of the project work in favour of Respondent 2 involved judicial review of administrative action. The scope and the approach to be adopted in the process of any such review, has been settled by a long line of decisions of this Court. Reference to all such decisions is in our opinion unnecessary as the principles of law settled therefor are fairly well recognised by now. We may, therefore, refer to some of the said decisions only to recapitulate and refresh the tests applicable to such cases and the approach which a writ court has to adopt while examining the validity of an action questioned before it. 16. We may, therefore, refer to some of the said decisions only to recapitulate and refresh the tests applicable to such cases and the approach which a writ court has to adopt while examining the validity of an action questioned before it. 16. In Tata Cellular v. Union of India this Court emphasised the need to find the right balance between administrative discretion to decide the matters, on the one hand, and the need to remedy any unfairness, on the other, and observed: (SCC pp. 687-88, para 94) “(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. … (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 facets 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.” (emphasis in original) 17. In Raunaq International Ltd. v. I.V.R. Construction Ltd. this Court reiterated the principle governing the process of judicial review and held that the writ court would not be justified in interfering with commercial transactions in which the State is one of the parties to the same except where there is substantial public interest involved and in cases where the transaction is mala fide. The Court observed: (SCC pp. 500-01, paras 10-11) “10. What are these elements of public interest? (1) Public money would be expended for the purposes of the contract. (2) The goods or services which are being commissioned could be for a public purpose, such as, construction of roads, public buildings, power plants or other public utilities. The Court observed: (SCC pp. 500-01, paras 10-11) “10. What are these elements of public interest? (1) Public money would be expended for the purposes of the contract. (2) The goods or services which are being commissioned could be for a public purpose, such as, construction of roads, public buildings, power plants or other public utilities. (3) The public would be directly interested in the timely fulfilment of the contract so that the services become available to the public expeditiously. (4) The public would also be interested in the quality of the work undertaken or goods supplied by the tenderer. Poor quality of work or goods can lead to tremendous public hardship and substantial financial outlay either in correcting mistakes or in rectifying defects or even at times in redoing the entire work—thus involving larger outlays of public money and delaying the availability of services, facilities or goods, e.g., a delay in commissioning a power project, as in the present case, could lead to power shortages, retardation of industrial development, hardship to the general public and substantial cost escalation. 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. 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 involved, or the transaction is entered into mala fide, the court should not intervene under Article 226 in disputes between two rival tenderers.” 18. Therefore, unless the court is satisfied that there is a substantial amount of public interest involved, or the transaction is entered into mala fide, the court should not intervene under Article 226 in disputes between two rival tenderers.” 18. In Reliance Airport Developers (P) Ltd. v. Airports Authority of India, this Court held that while judicial review cannot be denied in contractual matters or matters in which the Government exercises its contractual powers, such review is intended to prevent arbitrariness and must be exercised in larger public interest. 19. Reference may also be made to Sterling Computers Ltd. v. M & N Publications Ltd. where this Court held that the power of judicial review in respect of contracts entered into on behalf of the State primarily involves examination of the question whether there was any infirmity in the decision-making process, and if such process was reasonable, rational and non-arbitrary, the Court would not interfere with the decision. 20. In Air India Ltd. v. Cochin International Airport Ltd. this Court held that the award of contract was essential in commercial transactions which involves commercial consideration and results in commercial decision. While taking such decision the State can choose its own method on terms of invitation to tender and enter into negotiations. The following passage from the decision is apposite: (SCC pp. 623-24, para 7) “7. … The award of 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 paramount are commercial considerations. The State can choose its own method to arrive at a decision. It can fix its own terms of invitation to tender and that is not open to judicial scrutiny. It can enter into negotiations before finally deciding to accept one of the offers made to it. Price need not always be the sole criterion for awarding a contract. It is free to grant any relaxation, for bona fide reasons, if the tender conditions permit such a relaxation. It may not accept the offer even though it happens to be the highest or the lowest. But the State, its corporations, instrumentalities and agencies are bound to adhere to the norms, standards and procedures laid down by them and cannot depart from them arbitrarily. It may not accept the offer even though it happens to be the highest or the lowest. But the State, its corporations, instrumentalities and agencies are bound to adhere to the norms, standards and procedures laid down by them and cannot depart from them arbitrarily. Though that decision is not amenable to judicial review, the court can examine the decision-making process and interfere if it is found vitiated by mala fides, unreasonableness and arbitrariness. … Even when some defect is found in the decision-making process the court must exercise its discretionary power under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the court should intervene.” (Emphasis Supplied) In view of the aforesaid decisions, very limited is the power of this Court in judicial review under Article 226 of the Constitution of India, especially, when the subjective satisfaction has been arrived at by the bid scrutiny committee as per their order dated 11th September, 2014 that the work of this appellant was not up to the mark of satisfaction. This court is not sitting in appeal against the decision of this subjective satisfaction, arrived at by the scrutiny committee. There is no error in decision making process by the Bid-scrutiny Committee. There is no arbitrariness or irrationality on the part of the State. In fact, no public interest is involved in this L.P.A. as envisaged in para 9, 10 & 11 of the decision in Raunaq International Ltd. Vs. I.V.R. Construction Ltd. reported in (1999) 1 SCC 492 , hence also there is no substance in this L.P.A. (x) Much has been argued out by the counsel for the appellant that respondent no. 7 should not have been given the contract of manufacturing and supply of country made liquor/spiced country made liquor. Several arguments have been canvassed about the disqualification of respondent no. 7. 7 should not have been given the contract of manufacturing and supply of country made liquor/spiced country made liquor. Several arguments have been canvassed about the disqualification of respondent no. 7. Counsel for the appellant has also pointed out the decision rendered by the Hon'ble Supreme Court in a case Dr A. Franklin Joseph Versus State of T.N. and others, reported in (1994)2 SCC 387 and submitted that the Respondent-State has followed the principle : “Show me the man, I will show you the law”. This attractive argument is not helpful to the appellant, mainly for the reasons : (a) There is no specific prayer in the writ petition preferred by this appellant in WPC No. 4940 of 2014 for cancellation of the contract given to the respondent no. 7; (b) Looking to the prayer in the writ petition, it has been stated that the decision arrived at by the bid scrutiny committee dated 11th September, 2014 should be quashed and set-aside. (xi) Thus, there was no specific prayer for the cancellation of the contract given to the respondent no. 7, despite the memo of the writ petition was amended by this appellant. Even in the amendment, there is no such prayer at all. Counsel for the appellant has relied upon several decisions. None of these decisions are helpful to the appellant, looking to the following peculiar facts of the present case that: (a) despite, retail licence given in the district of East Singhbhum for the year 2006-2007, there was no payment of licence fees in time; (b) Despite the fact that there was lot of dissatisfaction on the part of this appellant about non-granting of retail licence for the year 2007-2008, when the notice inviting tender for the year 2008-2011 was published in the month of April, 2008, this appellant took a calculative risk and he offered and ultimately, his offer was accepted and this appellant was granted exclusive privilege under section 22 of the Act, 1915, for the year 2008-2011. Thereafter, retail licences were also given from November, 2008 and after this fact or any reason whatsoever, this appellant has withdrawn its consent in the month of December, 2008 and thereby has surrendered its exclusive licence and thereby it has surrendered its prospective licences. Thereafter, retail licences were also given from November, 2008 and after this fact or any reason whatsoever, this appellant has withdrawn its consent in the month of December, 2008 and thereby has surrendered its exclusive licence and thereby it has surrendered its prospective licences. This is not permissible, looking to section 44(2) to be read with explanation thereof, of the Act, 1915; (c) The subjective satisfaction has been arrived at by the bid scrutiny committee while scrutinizing all the bids for the year 2014-2018. They have subjectively arrived at a conclusion on 11th September, 2014 that the work of this appellant was not up to mark of satisfaction in the previous years; (d) We are not sitting in appeal against the subjective satisfaction, arrived at by the bid scrutiny committee. The decision of the bid scrutiny committee cannot be said to be an arbitrary looking to the facts of the present case, nor it can be said that the said decision was based upon “No Evidence”, nor it can be said that it is discriminative in nature. There is no hard and fast rule or the mathematical formula with this Court to arrive at a conclusion that the work of this appellant was satisfactory in the previous years. This Court cannot replace its own subjective satisfaction, in place of the satisfaction arrived at by the bid scrutiny committee, while exercising power under Article 226 of the Constitution of India, otherwise no contract can be finalized at all. Too much fishy inquiry is not permissible by this Court, while exercising power under Article 226 of the Constitution of India, especially, in the matter of contract, which is based upon the will and wish of the parties of the contract. (xii) The aforesaid facts make the present case different, from the facts of the cases, upon which, heavy reliance is placed by the counsel for the appellant. Hence, all those judgments are not helpful to the appellant for getting the reliefs as prayed for. (xiii) Counsel for the appellant has also contended that the decision of the bid scrutiny committee dated 11th September, 2014 tantamounts to permanent blacklisting of this appellant. Hence, all those judgments are not helpful to the appellant for getting the reliefs as prayed for. (xiii) Counsel for the appellant has also contended that the decision of the bid scrutiny committee dated 11th September, 2014 tantamounts to permanent blacklisting of this appellant. This contention is not accepted by this Court mainly for the reasons that: (a) Black listing is a notion or idea running in the mind of this appellant, because there is no such order at all by the Respondent-State; (b) Rejection of the bid is based upon clause no. 16 of the Notice Inviting Tender dated 14th August, 2014 (Annexure -2 to the memo of this Letters Patent Appeal); (c) The validity of insertion of clause no. 16 in the Notice Inviting Tender is not under challenge; (d) So long as clause no. 16 in Notice Inviting Tender continues, there is bound to be the rejection of the bid, of this type of appellant. (e) If the clause no. 16 is omitted from the notice inviting tender, the bid of this type of appellant, can be accepted. Therefore, permanent black listing is a wrong notion, running in the mind of this appellant, because appellant has presumed that such type of clause no. 16 will also be there in the next notice inviting tender. We cannot here presume, such type of notice inviting tender and the clause no. 16 for all the time to come. This court will be extremely slow in interfering with the terms of N.I.T. especially when there is no challenge to the condition No. 16 of N.I.T. This appellant knows the ways and means how to come out from such type of difficulties because earlier one Mr. Ramji Prasad has experience of manufacturing and supply of country made liquor. This company has no experience at all, as required under notice inviting tender, but, they took Mr. Ramji Prasad as one of the Directors of the Company and member of appellant company and this is how, this appellant company has applied for the notice inviting tender and the experience of Ramji Prasad, one of the members of the company, has been treated as an experience of the company. There was ways and means with the appellant to come out from this type of rejection of the bids, with which, we are not concerned, at this stage, at all. There was ways and means with the appellant to come out from this type of rejection of the bids, with which, we are not concerned, at this stage, at all. It happens that Ramji Prasad may leave the company by selling his shares, but, the company has brought itself within the qualified bidder or eligible bidder as per notice inviting tender floated on 14th August, 2014 (Annexure -2 to the memo of this Letters Patent Appeal) and therefore, the contention that the appellant is permanently black listed is not accepted by this Court. 7. As a cumulative effect of the aforesaid facts, reasons and judicial pronouncements, no error has been committed by the Bid-scrutiny Committee in rejecting the bid of this appellant vide their minutes of the meeting/order dated 11th September, 2014 (Annexure -5 series to the memo of this Letters Patent Appeal) as well as no error has been committed by the learned Single Judge in deciding W.P.(C) No. 4940 of 2014 vide judgment and order dated 13th January, 2015. Hence, we see to reason to take any other view than what is taken by the learned Single Judge, while dismissing the writ petition bearing W.P.(C) No. 4940 of 2014 vide judgment and order dated 13th January, 2015. Hence, there is no substance in this Letters Patent Appeal and the same is dismissed, with no order as to costs. 8. All the I.As are also disposed of, in view of the final order passed in this Letters Patent Appeal.