PAWAN KUMAR  versus UNION OF INDIA & ORS.
[2024] 12 S.C.R. 1253, Supreme Court of India, 2024
Outcome: Appeal(s) allowed (Granted)
Segment: Issues
[2024] 12 S.C.R. 1253 : 2024 INSC 1041
Pawan Kumar 
v.
Union of India & Ors.
(Civil Appeal No. 14689 of 2024)
18 December 2024
[J.B. Pardiwala and R. Mahadevan, JJ.]
Issue for Consideration
Pursuant to an advertisement published by the Bharat Petroleum 
Corporation Limited (“BPCL”), the appellant made an online 
application for being appointed/ allotted a regular and rural retail 
outlet. The appellant was selected on draw on lots and he offered 
a suitable piece of land for purchase/lease belonging to third 
parties - Shri Lila Dhar and Shri Dinesh Kumar, whose consent 
letters were made available along with the application. At the time 
of application, there was some dispute between Mr. Lila Dhar 
and Mr. Dinesh Kumar as regards the land which was offered 
by the appellant. But the same ultimately came to be settled to 
the satisfaction of the Corporation before they issued the Letter 
of Intent. An unsuccessful contender in the application process 
filed a writ petition challenging the allotment to the appellant on 
ground of ‘False information’. The High Court allowed the writ 
petition. The appellant is before the Hon’ble Supreme Court 
against that order. 
The issue before the Hon’ble Supreme Court was as to when a 
Constitutional Court can interfere with the decision of the Public 
Sector Undertaking (PSU) allotting retail outlets.
Headnotes†
Judicial review – When can a Constitutional Court interfere 
with the decision of the allotment of retail outlets made by
Public Sector Undertaking:
Held: The Court shall interfere with the decision of allotment of 
dealership when the Corporation (PSU) shows outright favor to 
the appellant – Once the PSU was convinced with the entire 
procedure undertaken by the appellant, the Constitutional Courts 
have no business interfering with the allotment – Power of judicial
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review would be called for if the approach of the PSU is arbitrary 
or mala fide or procedure adopted is meant to favor one of the 
applicants – The decision-making process should clearly show that 
the said maladies are kept at bay. [Paras 22-23, 25]
Tenders – When should a Constitutional Court exercise Judicial 
Restraint with regard to the decision of PSU Corporations 
granting it:
Held: The PSU that authors the tender documents is the best 
person to understand and appreciate its requirements and interpret 
its documents and therefore, the constitutional courts must defer to 
this understanding and appreciation of the tender documents, unless 
there is mala fide or perversity in the understanding or appreciation 
or in the application of the terms of the tender conditions – For the 
mere reason that the PSU has given an interpretation to the tender 
documents that is not acceptable to the constitutional courts it cannot 
be a reason to interfere with the interpretation – Where a decision 
is taken that is manifestly in consonance with the language of the 
tender document or subserves the purpose for which the tender is 
floated, the court should follow the principle of restraint and technical 
evaluation or comparison by the court would be impermissible – 
The principle that is applied to scan and understand an ordinary 
instrument relatable to contract in other spheres has to be treated 
differently than interpreting and
appreciating tender documents 
relating to technical works and projects requiring special skills – The 
owner should be allowed to carry out the purpose and there has 
to be allowance of free play in the joints. [Para 25]
List of Acts
Constitution of India.
List of Keywords
Retail outlet dealership; Allotment of dealership; False information; 
Judicial review; Judicial restraint
Case Arising From
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 14689 of 2024
From the Judgment and Order dated 06.07.2023 of the High Court 
of Himachal Pradesh at Shimla in CWP No. 835 of 2020
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Pawan Kumar v. Union of India & Ors.
Appearances for Parties
Jayant Bhushan, Sr. Adv., Shyam S Sharma, Sanjeev Kumar 
Baliyan, Rishabh Singhle, Amartya Bhushan, Yojit Mehra, Tushar 
Bhushan, Yash Yadav, Ms. Jyoti Garg, Sujoy Chatterjee, Advs. 
for the Appellant.
S.D. Sanjay, A.S.G., V. Giri, Sr. Adv., Vikrant Narayan Vasudeva, 
Rohit Lochav, Shlok Chandra, Suyash Pandey, Shaurya Rai, Sunita 
Gautam, Madhav Sinhal, Dr. N. Visakamurthy, Parijat Sinha, Divyam 
Dhyani, Ms. Reshmi Rea Sinha, Rahul Narang, Shyamal Kumar, 
Advs. for the Respondents.
Judgment/Order of the Supreme Court
Order
1.	
Application seeking deletion of proforma Respondent No.1 from the 
array of parties is allowed at the risk of the appellant.
2.	
Cause title be amended accordingly.
3.	
Leave granted.
4.	
This appeal arises from the judgment and order passed by the 
High Court of Himachal Pradesh at Shimla dated 6-7-2023 in CWP 
No.835/2020, by which the Writ Petition filed by the Respondent 
No.5 - herein (original petitioner before the High Court) came to be 
allowed and thereby the allotment of dealership by Bharat Petroleum 
Corporation Limited to run a petrol pump in favour of the appellant - 
herein came to be cancelled.
5.	
The facts in brief necessary for the disposal of this appeal may be 
set out thus:-
6.	
The Bharat Petroleum Corporation Limited (for short, the “BPCL”) 
issued an advertisement dated 25-11-2018 for appointment/allotment 
of retail outlet dealerships for
petrol pumps in the State of Maharashtra.
7.	
It is not in dispute that the appellant - herein made an online 
application showing his willingness for being appointed/ allotted 
retail outlet dealership.
8.	
The appellant - herein claims to be falling within the OBC category 
and accordingly he applied against the OBC category on 24-12-2018.
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9.	
The appellant was included in Group II as mentioned in clause 4(v) 
of the brochure for selection of dealers for regular and rural retail 
outlet, i.e., the appellant had affirmed offer for suitable piece of land 
for purchase/lease belonging to a third party.
10.	 It appears from the materials on record that the appellant offered a 
piece of land owned by Shri Lila Dhar and Shri Dinesh Kumar bearing 
KK No. 4/5, Khasra No. 167/70 measuring 7-6 Bighas situated at 
Mauza Patta.
11.	 It also appears that there was some dispute between Mr. Lila Dhar 
and Mr. Dinesh Kumar as regards the land which was offered by the 
appellant herein. However, the same ultimately came to be settled 
to the satisfaction of the Corporation.
12.	 The Respondent No.5 - herein preferred a Civil Writ Petition 
No.835/2020 in the High Court and prayed for the following reliefs:-
"i)	
Issue a writ of certiorari to quash the letter of intent 
issued to the respondent No. 5 on the basis of draw 
lots held on 17.06.2019 for running of RO Dealership 
at village Patta, Tehsil Arki, District Solan, H.P.
ii)	
Issue a writ of mandamus directing the Respondent 
Nos. 1 to 4 to process the case of the petitioner 
for allotment of RO Dealership being most eligible 
applicant forthwith.
iii)	
Issue writ of mandamus directing the Respondent 
Nos. 1 to 4 to action who initiate appropriate has 
connived with respondent No. 5 in violating of RO 
Dealership Guidelines.
iv)	
Call for the records pertaining to the case at hand.
v)	
Direct the Respondent authorities to pay the cost of 
the petitions.”
13.	 The Writ Petition came to be allowed vide the impugned order passed 
by the High Court.
14.	 The High Court while allowing the Writ Petition filed by the Respondent 
No.5 observed in paras 32 to 44 as under:-
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Pawan Kumar v. Union of India & Ors.
“32) None of these facts had been disclosed by respondent 
no.5 in his application.
33) Admittedly, Annexure P-3 Brochure issued by the 
Corporation for selection of dealer for retail outlets, contains 
Clause 22 which states as under:-
“22 FALSE INFORMATION
If any statement made in the application or in the 
documents enclosed therewith or subsequently 
submitted in pursuance of the application by 
the candidate at any stage is found to have 
been suppressed/misrepresented/incorrect 
or false, then the application is liable to be 
rejected without assigning any reason and in 
case the applicant has been appointed as a 
dealer, the dealership is liable to be terminated. 
In such cases the candidate/dealer shall have 
no claim whatsoever against the respective 
Company.”
34) Thus, if any statement made in the application 
submitted by an applicant like respondent no.5 was at any 
stage found to have been false, incorrect or certain facts 
are found to have been suppressed or misrepresented, 
then the application was liable to be rejected by the 
Corporation without assigning any reason and in case, an 
applicant had been appointed as a dealer, the dealership 
was liable to be terminated.
35) Strangely, notwithstanding such a Clause having been 
incorporated in the Brochure issued by the Corporation, and 
notwithstanding the fact that the petitioner had informed 
about the false information furnished by respondent
no.5 
to respondents no.2 to 4 on 25.06.2019 (including the 
factum of pendency of a Civil Suit between Leeladhar and 
his brother Dinesh Kumar), respondents no.2 to 4 went 
ahead and issued the Letter of Intent on 21.09.2019 to 
respondent No.5 in gross violation of Clause-22, referred 
to above.
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36) In our considered opinion, it was not open to 
respondents no.2 to 4/Corporation to grant the retail outlet 
dealership to respondent no.5 in the face of Clause-22 
of the Brochure, merely on the ground that there was a 
subsequent Out of Court Settlement between Leeladhar 
and his brother Dinesh Kumar and Dinesh Kumar later 
gave an affidavit stating that he has no objection for grant 
of retail outlet dealership to respondent no.5.
37) This is because in the application filed by respondent 
no.5 at Sr. no.13 where land details are to be furnished, 
respondent no.5 could have mentioned that Leeladhar 
and others were co-owners of the land, but instead, he 
mentioned only Leeladhar and did not mention either about 
the other co-owners or about the pendency of the civil suit 
between Leeladhar and his brother Dinesh Kumar.
38) In view of the undertaking given in the said application 
as well as declaration signed by respondent no.5 that wrong 
information/misrepresentation/ suppression of facts would 
make him ineligible the retail outlet dealership, which would 
bind the 5th respondent, not only respondents no.2 to 4 
cannot grant him the retail outlet dealership but cannot 
also they cannot defending their action in giving him the 
Letter of Intent by calling the petitioner as a medlesome 
interloper.
39) We fail to see how the petitioner can be considered as 
a medlesome interloper in the facts and circumstances of 
the
case, when he was also a contender for the allotment 
of the retail outlet alongwith the respondent no.5.
40) As held in the decision of Ramana Dayaram Shetty 
versus The International Airport Authority of India & 
Others, (1979) 3 SCC 489 if an executive agency lays 
down certain standards which it professes its actions to 
be judged, it must scrupulously observe those standards. 
In the said case, the Supreme Court held that today 
the Government in a welfare State is the regulator and 
dispenser of special services and provider of a large
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Pawan Kumar v. Union of India & Ors.
number of benefits, including jobs, contracts, licenses, 
quotas etc.; the valuables dispensed by Government take 
many forms; many individuals and many more businesses 
enjoy largess in the form of Government contract, and the 
discretion of the Government or its agency is not unlimited, 
in that, it cannot give or withhold largess in its arbitrary 
discretion or its sweet will.
41) This was reiterated in B.S. Minhas versus Indian 
Statistical Institute & Others (1983) 4 SCC 582, where the 
Supreme Court held that it is obligatory on the part of the 
respondent to follow its bye-laws since they have been 
framed for the conduct of its affairs to avoid arbitrariness 
and the respondent cannot escape liability for not following 
the procedure prescribed in the bye-laws.
42) Recently, this was reiterated in M.P. Power Management 
Company Limited versus Sky Power Southeast Solar India 
Private Limited & Others (2023) 2 SCC 703 and it was held 
that if an agency of the State had laid down astandard or 
a norm of eligibility and if a person submitting a tender 
did not satisfy this condition of eligibility, his tender would 
not be eligible for consideration. It held that this Principle 
had an independent existence apart from Article 14 of the 
Constitution of India.
43) Having regard to the settled legal position, we are of 
the opinion that the award of the retail outlet dealership by 
respondents No.2 to 4-BPCL to
respondent no.5, cannot 
be sustained since respondent no.5 had misrepresented 
in his application that Leeladhar was the sole owner 
of the land offered for setting up the said outlet, but 
the truth was otherwise, and the land was co-owned 
by Dinesh Kumar and there was also a civil litigation 
pending before the Civil Court, which was not disclosed 
by respondent no.5.
44) Accordingly, the Writ petition is allowed; the letter of 
intent issued on 21.09.2019 by respondent nos.2 to 4 to 
respondent no.5 is set aside; and the respondents are
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directed to consider the case of the petitioner for grant 
of the retail outlet dealership in the said village within six 
weeks. The respondent no. 2-4 together and the respondent 
no.5 shall pay costs of Rs.10,000/- each to the petitioner.”
15.	 It appears from the line of reasoning assigned by the High Court that 
the appellant – herein was found to be guilty of not disclosing few 
relevant facts before the Corporation for the purpose of allotment 
of the dealership.
16.	 Since the allotment in favour of the appellant – herein came to be 
cancelled by the impugned judgment of the High Court, the appellant 
is here before this Court with the present appeal.
17.	 We have heard Mr. Jayant Bhushan, the learned Senior counsel 
appearing for the appellant, Mr. V. Giri, the learned Senior counsel 
appearing for the BHPL and Mr. Vikrant Narayan Vasudeva, the 
learned counsel appearing for the Respondent No.5 – herein who 
was the original petitioner before the High Court.
18.	 We take notice of the stance of the Corporation before the High 
Court as reflected from the reply.
19.	 The Corporation made itself abundantly clear that it had received 
all the relevant documents with necessary information from the 
appellant  – herein for the purpose of processing the online application 
for allotment of dealership. 
20.	 We quote Paras 17 and 18 respectively of the affidavit in reply filed 
by the Corporation before the High Court.
“17. That
the contents of this para are factually in correct, 
hence denied. The petitioner has deliberately indulged in 
mis-statement of facts regarding the out of court amicable 
settlement between the co owners of the land leading upto 
issuance of LOI in favor of respondent no.5. As mentioned 
earlier the selected candidate provided the replying 
respondents all the relevant land documents including 
consent from co-owners which were checked and verified 
by the concerned application scrutiny committee and after 
having found them to be in order his case was processed 
further. Only after following all the guidelines and policies
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Pawan Kumar v. Union of India & Ors.
for allotment of retail outlet a Letter of Intent was finally 
issued in favor of respondent no.5.
18. Contents of this para are factually incorrect, hence 
denied. It is not understood as to on what basis the 
petitioner has come up with the claim as the selection 
process was to be completed within 41 days. It is submitted 
that the selected candidate Sh. Pawan Kumar had applied 
online under Group 2 for the retail outlet dealership. The 
intimation of selection post draw of lots and the list of 
documents to be submitted by the selected candidates 
was sent to Respondent no.5 over e-mail on 21.06.2019. 
He submitted all the relevant documents as required by 
the replying respondent including consent from the co-
owners. The application and documents submitted by 
selected candidate were scrutinized by the application 
scrutiny committee strictly in line with Selection Brochure 
2018. After following all the laid down norms mentioned in 
Selection Brochure 2018, Letter of Intent was finally issued 
in favor of respondent no.5. Besides, in consonance with 
the conditions of letter of Intent, respondent no 5 entered 
into a lease agreement with the other co-owners on 
20.12.2019. Finally the replying respondent received NOC 
from DC Solan for the subject location dated 1.02.2020. It 
is further pertinent to mention that the petitioner was never 
selected for the subject location and therefore there is 
absolutely
no occasion for him to submit any documents to 
the replying respondent. It is further reiterated that as the 
petitioner was never selected, the answering respondent 
could not comment upon his eligibility.”
21.	 Before this Court also, the Corporation has filed its reply stating as 
under :-
“XII. The said Special Leave Petition deserves to be allowed 
also because the respondent No. 5 has unnecessarily and 
wrongly impleaded respondent No. 1 - Union of India as 
a party respondent in the present proceedings as it is not 
in any manner whatsoever connected with the issue in 
question. As such, the Hon’ble High Court ought to have
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dismissed the writ-petition itself for misjoinder of parties 
and in the alternative, the respondent No. 1 ought to have 
been deleted from the parties.
XIII. The said Special Leave Petition deserves to be 
allowed also because as per the Policy Guidelines, 
online applications were invited from amongst the eligible 
candidates and the categories of their applications were 
segregated according to the guidelines. The answering 
respondent/BPCL did not receive any application under 
Group 1 category. Hence, the answering respondent/BPCL 
proceeded with the draw of Lots for candidates under 
Group 2 category on 17.06.2019, in which the petitioner was 
selected. Accordingly, he was sent intimation of selection 
and was also asked to submit all the necessary documents 
for further verification. Only after meticulously going through 
all the documents including land papers provided by the 
petitioner, his case was processed and he was issued the 
Letter of Intent (LOT) by the answering respondent/BPCL 
strictly in conformity with the said Brochure of 2018.
XIV. The said Special Leave Petition deserves to be allowed 
also because all the relevant documents received from the 
petitioner/ selected candidate were thoroughly scrutinized 
and only after that the Letter of Intent (LOI) was issued 
in his favour. It is also pertinent to mention that before 
issuance of the LOI, a compromise had been reached 
between Sh. Leela Dharand Sh.
Dinesh Kumar and the 
other co-owners of the offered land. Accordingly, Sh. Dinesh 
Kumar, prepared and submitted an affidavit mentioning the 
amicable out of court settlement of the dispute between 
the co-owners of the land offered for establishment of 
Retail Outlet/Petrol Pump by the petitioner. He also filed 
an application on 08.08.2019 before the Ld. Civil Judge 
Arki, District Solan, Himachal Pradesh, for withdrawal of 
the pending Civil Suit. Subsequently, vide registered lease 
deed dated 20.12.2019, the subject land has been taken 
on lease by the petitioner from the co-owners, including 
Sh. Dinesh Kumar and Sh. Leela Dhar.
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XV. The said Special Leave Petition deserves to be allowed 
also because the Court case on the subject land has 
been amicably resolved between the co-owners by way 
of amicable out of court settlement and only after that the 
LOI has been issued in favour of the petitioner. As a matter 
of fact, pendency of civil dispute in respect of offered land 
does not ipso facto debar the candidate from applying for 
retail outlet dealership. The affidavits from all the co-owners 
were obtained as per Appendix III A of the said Brochure 
of 2018. Since the dispute was resolved and the court 
case was withdrawn, the land in question became free 
from any encumbrance and only after meticulous scrutiny 
of all the documents provided by the petitioner / selected 
candidate, his case was processed and has been issued 
the LOI by the answering respondent/BPCL absolutely in 
consonance with the said Brochure of 2018.
XVI. The said Special Leave Petition deserves to be allowed 
also because immediately on the receipt of the complaint 
from the respondent No. 5, the selection process of the 
petitioner was stopped and explanation and supporting 
documents, were sought for from the petitioner. Only 
after being satisfied that the offered land was suitable 
for establishment of a retail outlet and the court case 
had been resolved amicably, the answering respondent/
BPCL proceeded to issue the LOI to the petitioner on 
21.09.2019. In
fact the petitioner /selected candidate 
provided to the answering respondent/BPCL all the relevant 
land documents, including consent from the co-owners 
which were checked by the concerned application scrutiny 
committee even prior to the complaint of the respondent 
No. 5. Moreover, any complaint against a candidate can be 
entertained only if it is made as per procedure prescribed 
under Clause 18 - Grievance Redressal System provided 
in the said Brochure of 2018.
XVII. The said Special Leave Petition deserves to be 
allowed also because the respondent No. 5 subsequently 
made a representation through the PG Portal, which
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was duly replied vide the answering respondent/BPCL’s 
letter dated 10.08.2019. It is respectfully submitted that 
from the averments made in para 14 of his writ petition, 
it appears that the respondent No. 5 has misconceived 
and misunderstood the selection process described in 
the said Brochure of 2018. It is pertinent to mention that 
the Field Verification of Credentials (FVC) is to be carried 
out for the selected with respect to the details provided 
by him in the application form. The FVC was duly carried 
out by the FVC with the guidelines laid down in the said 
Brochure of 2018 and only thereafter the petitioner was 
recommended for issuance of the LOI.
XVIII. The said Special Leave Petition deserves to be 
allowed also because before establishment of the retail 
outlet, it is required of the co-owners of the offered 
land to give their consent letter for establishment of the 
retail outlet prior to issuance of the LOI. The petitioner 
/selected candidate was called upon to provide all the 
relevant land documents, including consent affidavits 
from the co-owners of the land which were duly submitted 
by him before the Application Scrutiny Committee and 
only after the thorough verification of their authenticity, 
approval was sanctioned for issuance of the LOI in favor 
of the petitioner.
XIX. The said Special Leave Petition deserves to be allowed 
also because the averment of respondent No. 5 in para 
18 of his writ
petition that the whole process was to be 
completed within a period of 41 days from the date of draw 
of lots and that respondent No. 5 was very much eligible 
and has given all the requisite documents as required by 
the answering respondent /BPCL at the time of making 
application, was clarified by the answering respondent/
BPCL in its reply dated 03.11.2020. It is submitted that 
the averment of the respondent No. 5 to the effect that the 
selection process was to be completed within 41 days is 
without any basis and is misconceived. It is further stated 
that the respondent No. 5 was not selected in the draw
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Pawan Kumar v. Union of India & Ors.
of lots for the subject location and therefore there was 
absolutely no occasion for him to submit any documents 
to the answering respondent/BPCL.”
22.	 It would have been altogether a different situation had the Corporation 
shown outright favour to the appellant in the allotment of dealership. 
That does not seem to be in the present litigation.
23.	 What weighed with the High Court was some non-disclosure of 
information relevant for the purpose of allotment of dealership. Once 
the Corporation, a Public Sector Undertaking was convinced with the 
entire procedure undertaken by the appellant – herein, then there 
was no good reason for the High Court to disturb the allotment of 
dealership which was granted way back in the year 2020 at the 
instance of the respondent no. 5.
24.	 The BPCL having authored the tender documents, is the best 
person to understand and appreciate its requirements and 
interpret its documents. The constitutional courts must defer to this 
understanding and appreciation of the tender documents, unless 
there is mala fide or perversity in the understanding or appreciation 
or in the application of the terms of the tender conditions. It is 
possible that the owner or employer of a project may give an 
interpretation to the tender documents that is not acceptable to the 
constitutional courts but that by itself is not a reason for interfering 
with the interpretation given.
25.	 Exercise of
power of judicial review would be called for if the approach 
is arbitrary or mala fide or procedure adopted is meant to favour 
one. The decision-making process should clearly show that the 
said maladies are kept at bay. But where a decision is taken that is 
manifestly in consonance with the language of the tender document or 
subserves the purpose for which the tender is floated, the court should 
follow the principle of restraint. Technical evaluation or comparison 
by the court would be impermissible. The principle that is applied 
to scan and understand an ordinary instrument relatable to contract 
in other spheres has to be treated differently than interpreting and 
appreciating tender documents relating to technical works and projects 
requiring special skills. The owner should be allowed to carry out 
the purpose and there has to be allowance of free play in the joints.

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26.	 In such circumstances, referred to above, we have reached the 
conclusion that the impugned judgment is not sustainable in law and 
deserves to be set aside and is, accordingly, set aside.
27.	 The appeal is allowed in the aforesaid terms.
28.	 Pending applications, if any, also stand disposed of.
Result of the case: Appeal allowed.
†Headnotes prepared by: Swathi H. Prasad, Hony. Associate Editor
(Verified by: Kanu Agrawal, Adv.)