IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HON'BLE THE CHIEF JUSTICE MR.J.CHELAMESWAR & THE HONOURABLE MR. JUSTICE P.R.RAMACHANDRA MENON WEDNESDAY, THE 10TH AUGUST 2011 / 19TH SRAVANA 1933 WA.No. 1128 of 2011 --------------------- AGAINST THE JUDGEMENT IN WPC.12012/2011 Dated 24/06/2011 .................... APPELLANT/PETITIONER: --------------------------- P.N.MOHAMMED MUSTHAFFA, S/O.NOOR MUHAMMAD, AGED 56 YEARS, 'SHERIN', VASUDEVA NAGAR, ROBINSON ROAD, PALAKKAD-678001. BY ADV. SRI.BINOY VASUDEVAN SMT.P.G.BABITHA RESPONDENTS/RESPONDENTS: ----------------------------------- 1. THE KOLLENGODE BLOCK PANCHAYAT, OFFICE OF THE BLOCK PANCHAYAT, KOLLENGODE P.O., PALAKKAD-678 506. 2. THE BLOCK DEVELOPMENT OFFICER (SECRETARY), BLOCK PANCHAYAT, OFFICE OF THE BLOCK PANCHAYAT, KOLLENGODE P.O., PALAKKAD-678 506. THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 10/08/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: J.Chelameswar, C.J. & P.R.Ramachandra Menon, J. - - - - - - - - - - - - - - - - - - - - - - - - - - - - W.A. No. 1128 OF 2011 - - - - - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 10th day of August, 2011 JUDGMENT J.Chelameswar, C.J. Aggrieved by judgment dated 24.06.2011 in W.P.(C) No.12012 of 2011, the unsuccessful writ petitioner preferred the instant appeal. 2. The subject matter of the dispute in the writ petition is the rejection of the lowest tender offer made by the appellant herein. The respondent invited tenders for supply of various items mentioned in Ext.P1 tender notification. According to the appellant, the offer made by him is the best offer, as he quoted the lowest rate for the supply of materials required to be supplied. In spite of such a situation, the respondent did not accept the tender offer made by the appellant and decided to call for fresh tenders. Therefore, the appellant approached this Court by way of the abovementioned writ petition which was dismissed at the admission stage. The operative portion of the judgment reads as follows: W.A. No. 1128 of 2011 -:2:- “2. The fact that a tender has been invited does not in any manner oblige the tender inviting authority to accept the tenders even if the rates quoted by a person is the lowest. A person who has made such an offer also has no right to insist that his tender should be accepted. However, the decision to cancel the tender or not to accept the lowest tender can be interfered with by a court of law exercising powers under Article 226 of the Constitution of India if i is demonstrated that the said decision is vitiated by malafides or extraneous considerations or arbitrariness. In this case, no pleadings, muchless any satisfactory plea has been raised by the petitioner to justify interference with the impugned decision of the respondents.” 3. The learned counsel for the appellant, however, argued that in view of the statutory rule, i.e. Rule 10(12) of the Kerala Panchayat Raj (Execution of Public Works) Rules, 1997, the respondents have no authority in law to reject the lowest tender and therefore the learned Judge erred in dismissing the writ petition. The relevant rule reads as follows: “10.Acceptance of tenders.-(12) Subject to sub-rule (14) the lowest tender shall be accepted for every public work: Provided that where the competent authority, on a report to that effect by the Secretary endorsed by the Panchayat Engineer, is satisfied that it will not be desirable to accept the W.A. No. 1128 of 2011 -:3:- lowest tender, the next higher tender may be accepted by rejecting the lowest tender after recording the genuine reasons.” 4. It may be noticed from the above extracted rule that the prescription of the rule is not absolute. The proviso indicates that in certain circumstances even the lowest tender can be rejected and the next higher tender may be accepted. The instant case is not even a case where the next higher tender is accepted, but the respondent chose to invite fresh tenders for the supply of materials. 5. The learned Judge, in our opinion, rightly came to the conclusion that the respondents have the discretion either to accept the lowest tender or to reject it in the absence of any specific plea either of malafides or extraneous considerations. It is well settled that in the matter of award of contracts by public bodies, a great deal of freedom is recognised in favour of the public authorities subject, of course, to the paramount consideration that such a freedom is not arbitrarily exercised. The ultimate purpose of all power vested in a public authority is the larger public interest. The stipulation such as the one W.A. No. 1128 of 2011 -:4:- insisting that normally the lowest tender should be accepted is a stipulation conceived in larger public interest. But such a stipulation cannot be an absolute stipulation by the very nature of the power. 6. We may also notice that the ground which is argued before us based on Rule 10(12) referred to above obviously is neither pleaded nor argued before the learned Judge though we hasten to add that it is a question of law which can be raised at any time. In the totality of the circumstances we do not see any reason to interfere with the judgment under appeal. The Writ Appeal is dismissed at the admission stage. J.Chelameswar, Chief Justice. P.R.Ramachandra Menon, Judge. ttb