ORDER : The petitioner is a private limited company and a registered A Class contractor under the Kerala Water Authority/ 1 st respondent. The petitioner had submitted its bid in response to the Ext.P1 e-tender notice issued by the 2 nd respondent for the work captioned “KIIFB Aided Thalassery- Kuthuparamba Comprehensive drinking Water Project- Construction of Service Reservoirs (24 Land & 14 LL) Supplying and Laying of Gravity mains, Distribution systems, Providing FHTCs etc.-Pipeline work”. In the tender proceedings conducted thereafter, petitioner and the 3 rd respondent were found to be having the necessary experience and expertise to be carry out the notified work. The financial bids were opened on 01-08-2024 and as per Ext.P5 item wise BoQ rates of the bidders published by the 2 nd respondent, petitioner's was the lowest quote (L1). The total PAC quote by the petitioner was 1.5% above the tendered PAC, while that of the 3 rd respondent was above 7%. As cost based system was adopted for the tender, all that remained was issuance of a selection notice/letter of award to the petitioner. At that stage, petitioner received reliable information that the work is likely to be awarded to the 3 rd respondent under the guise of the price preference orders issued by the Government with respect to Labour Contract Co-Operative Societies generally and the 3 rd respondent, specifically. In spite of the petitioner trying to reason out with the 2 nd respondent and other officials of the Water Authority, they were adamant in granting 10% price price preference to the 3 rd respondent. As the said illegal and arbitrary stand would result in the work being awarded to the 3 rd respondent, in spite of petitioner being the lowest bidder, this writ petition is filed seeking the following reliefs; “A. To declare that the petitioner being the Lowest Tenderer (LI), the official respondents are bound to award the work in favour of the petitioner having regard to Ext P1 being a cost based tender; B. To issue a writ or mandamus or any other writ or direction commanding the respondents No.1 and 2 to award the work to the petitioner pursuant to Ext P5. C. To declare that there could be no price preference could be granted in favour of the third respondent in respect of Ext P1 tender.” 2. C. To declare that there could be no price preference could be granted in favour of the third respondent in respect of Ext P1 tender.” 2. Learned counsel for the petitioner contended that, grant of price preference to the 3 rd respondent is grossly arbitrary, illegal and discriminatory and would result in tampering with the level playing field, which is fundamental for public tenders. Moreover, if any price preference was to be extended to participating Labour Contract Cooperative Societies, that should have found a place in the notice inviting tender. It is also contended that, being an autonomous body, Government Orders granting price preference to the 3 rd respondent or other societies, will not apply to tender proceedings of the Kerala Water Authority. 3. Learned Standing Counsel for the Water Authority submitted that the Government, through a series of orders, starting from GO(MS)No.135/97/Co-op. dated 13.11.1997 onwards, has conferred 10% price preference to Labour Contract Societies and the 3 rd respondent. In the subject contract, since total PAC quoted by the petitioners is 1.94% above tendered PAC and that of the 3 rd respondent is 9.77% above tendered PAC, 3 rd respondent became the lowest bidder (L1) on granting 10% price preference. The procedure adopted by the 2 nd respondent being strictly in accordance with the Government Orders governing the subject, no interference is warranted. 4. Learned counsel for the 3 rd respondent submitted that the constitutionality of the Government Orders extending benefits to Labour Contract Co-operative Societies and 3 rd respondent was challenged before this Court by private contractors. As per Ext.R3(e) judgment, this Court upheld the constitutionality of those Government Orders. That judgment was taken in appeal and the Division Bench categorically held that individual contractors cannot claim parity of treatment with Co-operative entities. It was also held that the court did not find any arbitrariness in the Government adopting such policies in pursuit of the larger well-being of the community [see Cherian Varkey Construction Company (Pvt) Ltd v. State of Kerala [2024(3)KLT 89]. It is hence contended that the petitioner or any other contractor cannot now challenge the Government Orders or assail the policy of granting price preference to societies. It is hence contended that the petitioner or any other contractor cannot now challenge the Government Orders or assail the policy of granting price preference to societies. In answer to the contention that the Kerala Water Authority being an autonomous body, Government Orders granting price preference are not applicable to it, learned counsel submitted that, as far as the subject contract is concerned, the Kerala Water Authority is only the Special Purpose Vehicle and the funding agency is KIIFB. It is submitted that, as per Ext.R3(g) order, guidelines for ensuring necessary standardisation and efficiency in preparation, processing and implementation of proposals of projects funded by the KIIFB has been formulated by the Government. The order also provides for execution of the projects through Special Purpose Vehicles. The Government Orders are squarely applicable to the contract under consideration. Since the Government Order is published in the official gazette, it has application for the purpose it covers. The Water Authority is also bound by the direction of the Government in view of Section 55 of the Kerala Water Supply and Sewerage Act. The decisions in Directorate of Education v. Educomp Datamatics Ltd. [ (2004) 4 SCC 19 ] and Michigan Rubber (India) Ltd. (M/s.) v. State of Karnataka and Others [ (2012) 8 SCC 216 ] were cited to highlight the limited scope for judicial review in contractual matters. 5. The challenge raised by the petitioner on the ground that the level playing field essential for public contracts is taken away by granting price preference to the 3 rd respondent is liable to be rejected outright in the light of Ext.R3(e) judgment of the single Bench, as affirmed by the decision of Division Bench in Cherian Varkey Construction Company (Pvt) Ltd v. State of Kerala [ 2024(3) KLT 89 ]. The contextually relevant portions of single Bench judgment reads as under; “The argument of the petitioner that the works executed by the Government out of its own tenders and works executed availing financial assistance from Kerala Infrastructure Investment Fund Board paying interest cannot be treated similarly, is also unacceptable. When preference is given to Labour Contract Co-operatives as a matter of State policy, it is for the State to decide how the amount raised through KIIFB to be expended and to what extent preference can be given to Co-operatives. When preference is given to Labour Contract Co-operatives as a matter of State policy, it is for the State to decide how the amount raised through KIIFB to be expended and to what extent preference can be given to Co-operatives. The further contention of the petitioner is that while giving price preference to Co-operatives, the Government has to ensure that the ULCC is a Labour Contract Co-operative Society at all. In the counter affidavit filed by respondents 1 to 3, it has been specifically stated that Ext.P6 order in favour of the ULCC was issued by the Government after considering the recommendations of the Registrar of Co-operative Societies, taking into account the number of members who are workers. There is no material on record to assume that the ULCC is not a Contract Labour Co-operative Society. The argument of the petitioner in this regard, is therefore liable to be rejected.” [ Cherian Varkey Construction Company (Pvt) Ltd v. State of Kerala and Others [2020 SCC OnLine Ker 5194] While affirming the above finding the Division Bench held as follows; These executive orders are grounded in well - established principles and economic policies of the Government, with the backing of the Constitution. Its validity is not tested on the basis of loss or gain to the public exchequer. The Court is not the master of governance but rather the State is responsible for shaping its policy in line with constitutional objectives. If the distribution of assets and wealth is intended to benefit a cooperative society, any monopoly created thereon cannot be said to be a disadvantage to the group left out, as the group was left out based on a fair dealing on the anvil of economic policy of the State. The revenue gain or revenue loss is not the criteria upon which a policy should be tested. The court cannot interfere with the policy except in cases where it results in manifest arbitrariness. If the State has adhered to economic policies consistent with constitutional objectives, it cannot be questioned through judicial review. The labourers of co - operative society belonged to the least advantaged group, while an individual contractor belonged to the advantageous distinct group. The court cannot interfere with the policy except in cases where it results in manifest arbitrariness. If the State has adhered to economic policies consistent with constitutional objectives, it cannot be questioned through judicial review. The labourers of co - operative society belonged to the least advantaged group, while an individual contractor belonged to the advantageous distinct group. Although both groups may share the same subject in pursuing business goals, if the State can identify distinction, not related to the subject, but differentiation on a larger goal; they become distinct in the eyes of the Constitution. There cannot be any symmetrical claim based on the subject of the contract awarded as claimants are asymmetrically placed in terms of state policy. State policy to promote a co - operative society(rather it is used as a means) but to promote the underlying community interest of the co - operative society. The learned author Michelle Maisese in his article on distributive justice (Footnote No.6) refers as follows:"some suggest a system of competition that includes safety nets for those who cannot compete. This sort of system combines the principle of equity with that of need. It attempts to reward people for their productivity at the same time that it ensures their basic needs are met". (Footnote No.7) The focus of the executive order, though ultimately related to the award of the contract, is essentially a focus to promote community interest consistent with the policies of the welfare State. Therefore, individual contractors cannot claim parity of treatment with co - operative entities. The Court cannot find any arbitrariness in government having such policies in pursuit of the larger well - being of the community. In the absence of any fundamental right that can be claimed by the individual contractors, the rest is a matter of State policy and where no parity can be claimed as the object of differentiation is not in recognising individual interest but rather the larger community interest. [ Cherian Varkey Construction Company (Pvt) Ltd v. State of Kerala ( 2024(3) KLT 89 )] 6. The contention that the Government Orders will not apply to the Water Authority unless adopted cannot also hold good in view of Section 54 of the Kerala Water Supply and Sewerage Act. [ Cherian Varkey Construction Company (Pvt) Ltd v. State of Kerala ( 2024(3) KLT 89 )] 6. The contention that the Government Orders will not apply to the Water Authority unless adopted cannot also hold good in view of Section 54 of the Kerala Water Supply and Sewerage Act. The said provision stipulates that in the discharge of its functions, Water Authority shall be guided by such directions on questions of policy as may be given to it by the Government. Yet another pertinent aspect is that the Water Authority is only engaged as the Special Purpose Vehicle for the subject work. As evident from Ext.R3(g) Government Order dated 24.02.2018, KIIFB funded projects are executed through Special Purpose Vehicles and those organisations being under the control of the State/Central Government, are bound to follow the rules, guidelines and norms applicable for execution of public works following PWD/CPWD guidelines. Being so, award of the work can only be in accordance with the Government Orders and the provisions of the PWD Manual. As held by the Apex Court in Michigan Rubber (India) Ltd. (M/s. ) (supra), Government and their undertakings must have a free hand in setting terms of the tender and courts should not interfere unless the terms are arbitrary, discriminatory, mala fide or actuated by bias. 7. The constitutional validity of the Government Orders granting privileges to Labour Contract Co-operative Societies having beeen upheld, a contract awarded in compliance of those orders cannot be interfered with on the ground that the privileges or the Government orders are not mentioned in the notice inviting tender. As cautioned by the Supreme Court in Directorate of Education v. Educomp Datamatics Ltd. (supra), even though Courts can scrutinise the award of contracts by the Government or its agencies in exercise of its power of judicial review to prevent arbitrariness and favouritism, there are inherent limitations in the exercise of such power. The constitutional courts should not strike down the terms of the tender prescribed by the Government or it agencies merely because it feels that some other terms in the tender would have been fair, wiser or logical. The constitutional courts should not strike down the terms of the tender prescribed by the Government or it agencies merely because it feels that some other terms in the tender would have been fair, wiser or logical. The award of work to the 3 rd respondent being in accordance with the Government Orders, this Court cannot interfere with the award, though it would have been ideal to mention the price preference for which Labour Contract Co-operative Societies are entitled, in the notice inviting tender. For the aforementioned reasons, the writ petition is dismissed.