Facts of the Case

This is a government-tender eligibility dispute, not a GST case — the petitioner's GST registration in Bihar was cited only as evidence of a genuine, long-standing branch office. Anil Mihir and Associates, a chartered accountancy firm, challenged the eligibility criteria and selection process for empanelment of CA firms for statutory audit of Rural Development Department schemes in Bihar. The firm alleged that a notified condition requiring a mandatory Bihar bank account (with 12 months' bank statements) was 'tailored' to disqualify otherwise eligible firms, including itself, despite having a Bihar branch office functioning for over five years and registered under GST laws in Bihar for more than three years.

Issues Involved

  1. Whether the mandatory requirement of a Bihar bank account (as opposed to a Bihar branch office) was a rational eligibility condition for empanelment of CA firms.
  2. Whether the petitioner's disqualification on that ground was legally sustainable.

Petitioner's Arguments

  • The selection process was biased, discriminatory, and 'tailored' to favour certain firms with official or political support.
  • The petitioner's Bihar branch office had functioned continuously for over five years as per ICAI records and was registered under GST laws in Bihar for more than three years, satisfying the substantive eligibility criteria even though its bank account was maintained in Odisha with confirmation that it also operated from Bihar.

Respondent's Arguments

  • No detailed counter-arguments on the rationality of the bank-account condition are recorded before the interim order; subsequently, the department filed a supplementary counter affidavit indicating the petitioner's grievance had been addressed.

Court Order / Findings

  • In an interim order dated 13.10.2023, the Court found no logical rationale for requiring a mandatory Bihar bank account (with 12 months' statements and GST returns) as a condition for empanelment spanning three years, and directed the Secretary, Rural Development Department, to examine whether the petitioner could be accommodated despite this disqualification.
  • The Court observed that a competent CA firm could not be disabled merely for lacking a Bihar bank account, and that if the department still insisted the condition was mandatory, the matter would proceed to a merits hearing.
  • On the next date, the department filed a supplementary counter affidavit; on perusal, the Court found the petitioner's grievance had been redressed.
  • The petition was accordingly disposed of as having become infructuous, without a final ruling on the legality of the impugned eligibility clause.

Important Clarification

The petitioner's GST registration was used only as one credential to demonstrate its Bihar branch's genuineness — the Court never examined any GST compliance question. Because the case ended as infructuous once the department accommodated the firm, the Court's interim observations on the bank-account condition (favourable to the petitioner) were never converted into a final, binding ruling.

Sections Involved

  • Constitution of India — Article 226 (writ jurisdiction over tender/empanelment decisions)

Decision – In Favour of

Disposed of as infructuous after the petitioner's grievance was administratively redressed; no final ruling was made on the validity of the challenged tender condition.

Case Details

Court: High Court of Judicature at Patna  |  Case No.: Civil Writ Jurisdiction Case No. 12655 of 2023  |  Coram: Hon'ble Mr. Justice P.B. Bajanthri and Hon'ble Mr. Justice Ramesh Chand Malviya  |  Date: 8 November 2023

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