Court dismisses PIL challenging Tamil Nadu Medical Service Corporation's procurement process, stating no arbitrariness or mala fides found in tender award to Joyalukkas India Limited
In a significant judgment delivered on September 10, 2026, the Madras High Court (Division Bench) dismissed a public interest litigation (PIL) petition filed by Raj G, a goldsmith, challenging the award of a government contract for supplying over four lakh gold rings under the Tamil Nadu government's welfare scheme "Thaimaman Thanga Mothiram Thittam." The contract was awarded to Joyalukkas India Limited by the Tamil Nadu Medical Services Corporation Limited (TNMSC).
The petitioner questioned the validity of the contract award dated August 21, 2026, contending that the bid quoted by the winning bidder-Rs.0.01 per ring exclusive of gold price-was abnormally low and non-responsive under Clause 5.8(vi) of the tender document. He also argued that TNMSC lacked the vires under its Memorandum of Association to procure bullion or jewelry. However, the petitioner did not challenge the welfare scheme itself, the tender conditions, or the revised price schedule and qualification criteria issued via corrigenda.
The court, comprising Chief Justice Sushrut Arvind Dharmadhikari and Justice G. Arul Murugan, reiterated the well-established principle that judicial review in tender and contractual matters is narrowly confined. It is limited to examining whether the decision-making process is tainted by arbitrariness, mala fides, or irrationality. The court emphasized that it is not a forum to act as an appellate authority replacing administrative expertise in commercial decisions.
Relying on Supreme Court precedents such as Tata Cellular v. Union of India (1994) and Michigan Rubber (India) Ltd. v. State of Karnataka (2012), the court underscored that fairness and non-arbitrariness are essential but courts should avoid interfering unless the tender process was malicious or unreasonable. The court found no evidence of mala fide intention or arbitrariness in accepting the lowest bid, which was openly tested against other qualified bidders. The clause allowing empanelment of multiple bidders at the L1 rate was validly exercised when the third respondent matched the lowest bid but was not awarded the contract.
The court also noted the petitioner's contradictory stance-while challenging TNMSC's authority to procure gold articles, he simultaneously sought directions for TNMSC to conduct a fresh procurement. Furthermore, since the petitioner was not a participant in the tender and had no personal stake, and none of the losing bidders had challenged the award, the court was reluctant to interfere in the commercial tender outcome.
In conclusion, the Madras High Court held that the impugned contract award was neither arbitrary nor irrational and dismissed the writ petition, allowing the welfare scheme procurement to proceed uninterrupted.
Bottom Line:
Judicial review in tender matters is limited to examining arbitrariness, mala fides, or irrationality in the decision-making process. Public interest litigation challenging a tender award, without questioning the scheme or tender conditions, is unsustainable.
Statutory provision(s):
Article 14 of the Constitution of India, Article 226 of the Constitution of India, Tamil Nadu Transparency in Tenders Rules, 2000 (Rule 29-A)
Raj.G v. Tamil Nadu Medical Service Corporation Limited, (Madras)(DB) : Law Finder Doc Id # 2976750
