Kamdhenn Cattle Feed Industries vs Food Corporation of India (Punjab Zone) and Others

M.R. Agnihotri and Amarjeet Chaudhary, JJ.—After hearing the learned counsel for the parties, we find that the procedure adopted by the respondent-Corporation m dealing with the tender submitted by the petitioner was wholly arbitrary

Admittedly, the petitioner was the highest bidder for the stocks of damaged rice to be allotted by the Corporation and on that basis was entitled to the allotment of the stocks The subsequent action of starting negotiations with the various parties and asking the petitioners to participate in the negotiations is not warranted by law and rather smacks of violation of Article 14 of the Constitution. For that matter, G. C. Dhuriwala, learned counsel for the petitioner, has rightly placed reliance on the judgment of Hon''ble Supreme Court reported as ( Harminder Singh Arora Vs. Union of India (UOI) and Others, .)

Mr. Hemant Kumar, learned counsel for the Food Corporation of India, respondent, has tried to justify the action of the respondent Corporation in starting negotiations by invoking to his aid the judgments reported as ( State of Orissa and Others Vs. Harinarayan Jaiswal and Others, , ( State of Uttar Pradesh and Others Vs. Vijay Bahadur Singh and Others, , ( Ram and Shyam Company Vs. State of Haryana and Others, , ( Food Labour Contract Co-operative Society Ltd. Vs. Food Corporation of India and Others, From the perusal of these authorities, it is clear that it is always open to the State to either adopt the procedure of inviting tenders or to settle the matter by negotiations But decision has to be taken in the very first instance, meaning thereby that once tenders have been invited and higher bidder has come forward to comply with the conditions stipulated by the State, then to switch over to negotiations with other parties is only a camoflage, the real intention being to ignore the highest bidder. Such a procedure cannot be countenanced in the rule of law.

Accordingly, we allow this petition and by issuing a writ of mandamus, direct the respondent Food Corporation of India to allot to the petitioner, who is the highest bidder, to the necessary stock of damaged rice for which the tenders had been invited. This shall be done within a period of two months.