Read Time: 06 minutes

Synopsis

The Delhi High Court has observed that engaging in “opportunistic litigation” undermines the fairness and credibility of the tendering process, creating an environment of unpredictability.

The bench comprising of Chief Justice Satish Chandra Sharma and Justice Sanjeev Narula said that such practices must be “strongly discouraged” to ensure integrity of the tendering system of procurement.

“Engaging in opportunistic litigation undermines the fairness and credibility of the tendering process, creating an environment of unpredictability. Such practices must be strongly discouraged to ensure the integrity of the tendering system of procurement”, the division bench said in its order dated August 1, 2023.

The court was dealing with a plea filed by a company challenging a tender issued by the Northern Railways to operate additional trains on a certain route.  

The petitioner company had an agreement with the railways to lease a parcel cargo express train on the Alwar-New Guwahati route. The petitioner argued that the tender notice proposed leasing of similar parcel cargo express trains on a "nearly identical" route, which would have a potential adverse impact on its business.

While dismissing the petition with costs of Rs. 50,000, the court said, "the costs will be deposited towards the Delhi Police Welfare Fund", adding that improvisation of railway operations should not be hindered by apprehensions of adverse impacts on the petitioner company’s business.

"The petition is dismissed with costs of Rs. 50,000/-, which the petitioner shall deposit with the Delhi Police Welfare Fund within three weeks from today," the court ordered. 

The bench opined that the petition did “not reveal any legal or constitutional grounds” and the petitioner company’s active engagement in the process and the subsequent success in securing the bid prevents them from now seeking quashing of the very same tender after failing to complete the necessary formalities.

The court also rejected the petitioner’s contention that the tender was in violation of their right to do business under Article 19(1)(g) of the Constitution and said that the right was subject to reasonable restrictions in the interest of public welfare and economic balance.

The court stated, "The Northern Railways decision to introduce new trains is a legitimate and essential step, aimed at enhancing railway services and meeting the evolving needs of the public. Such measures are essential for efficient functioning of the railway system and cannot be considered as arbitrary or unconstitutional restrictions on petitioner's right to conduct business of their choice”.

"Improvisation of railway operations should not be hindered by speculative apprehensions of adverse impacts on petitioner's business. Public interest considerations are crucial in such matters, and support the dismissal of the petition," observed the bench.

Case Title: M/S D.G. Raj Commercial Pvt. Ltd. And Anr. v. The General Manager, Northern Railways and Ors.