Facts of the Case

This dispute concerns a government tender, not any GST question. M/s INATSG (International Advance Technology and Service Group), a Patna-based proprietorship, participated in a Notice Inviting Tender (NIT) dated 06.03.2023 floated by the State Child Protection Society, Social Welfare Department, Government of Bihar, for an Annual Maintenance Contract for CCTV cameras across Bihar. The petitioner was declared the L-1 (lowest) bidder, quoting Rs. 2,34,01,917/- as its total bid price and Rs. 2,51,41,915/- component-wise (both figures excluding GST). The Department cancelled the tender on 25.04.2023 without initially assigning reasons, and thereafter floated a fresh tender on 22.05.2023, in which the petitioner did not participate; this fresh tender was also cancelled for want of competitive bidding. The petitioner challenged the cancellation of the original tender before the Patna High Court.

Issues Involved

  1. Whether the cancellation of the NIT dated 06.03.2023, in which the petitioner was declared L-1 bidder, was arbitrary for want of assigned reasons.
  2. Whether the petitioner's price quote, compared to a 2019 tender for similar work, justified the Tender Committee's decision to cancel.

Petitioner's Arguments

  • The cancellation dated 25.04.2023 was made without assigning any reason, and this could not be cured by later improved reasons, relying on Supreme Court rulings in Commissioner of Police, Bombay v. Gordhandas Bhanji and Mohinder Singh Gill v. Chief Election Commissioner.

Respondent's Arguments

  • Reasons for cancellation had, in fact, already been recorded by the Tender Committee on 14.04.2023 — before the impugned memo of 25.04.2023 and well before the writ petition — so there was no post-hoc improvement of reasons.
  • The petitioner's price quote of Rs. 2,51,41,915/- (excluding GST) was an astronomical increase compared to the roughly Rs. 2,49,99,999/- quoted by the same petitioner for similar, more extensive work (including supply and installation) in 2019.

Court Order / Findings

  • On examining the records summoned from the Department, the Court found that the Tender Committee had, in fact, assigned reasons for cancellation on 14.04.2023, prior to the impugned memo of 25.04.2023.
  • The price comparison with the 2019 tender supported the Department's reasoning that the 2023 bid was disproportionately high, and the cited Supreme Court decisions on improved reasons therefore did not assist the petitioner.
  • The writ petition was dismissed, with the Court clarifying that this would not bar the petitioner from participating in future NITs.

Important Clarification

GST appears in this order only because bid prices are conventionally quoted exclusive of GST, and the price comparison used by the Department and the Court factored in that exclusion. There is no ruling here on any GST rate, classification, or compliance issue — the case turns entirely on administrative law principles governing cancellation of government tenders.

Sections Involved

  • Article 226, Constitution of India — writ jurisdiction.
  • No GST statute was interpreted; the matter is governed by general principles of contract and administrative law applicable to public tenders.

Decision – In Favour of

Decided in favour of the Respondent — State of Bihar / State Child Protection Society; the writ petition was dismissed.

Case Details

Court: High Court of Judicature at Patna
Case No.: Civil Writ Jurisdiction Case No. 9448 of 2023
Coram: Justice P.B. Bajanthri and Justice Arun Kumar Jha
Date of Judgment: 13.09.2023

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