The High Court
Case Details
Signature Not Verified Digitally Signed Signed by: ROJALIN NAYAK Designation: JUNIOR STENOGRAPHER Reason: Authentication Location: HIGH COURT OF ORISSA, CUTTACK Date: 16-May-2025 17:27:16 IN THE HIGH COURT OF ORISSA AT CUTTACK W.P.(C). NO.24938 OF 2024 Ram Kumar Sahu …. Petitioner Mr. Prabodha Chandra Nayak, Advocate -versus- State of Odisha and others …. Opp. Parties
Legal Reasoning
Mr. Debashis Tripathy, Additional Government Advocate CORAM: JUSTICE K.R. MOHAPATRA JUSTICE DIXIT KRISHNA SHRIPAD
Decision
ORDER 15.05.2025 Order No. 01. 1. This matter is taken up through hybrid mode. 2. Petitioner, a successful bidder, who having passed the technical bid level entered the fray of contract, is grieving before the Writ Court against the termination of technical bid and rescinding of the contract, as a consequence thereof. 3. Mr. Nayak, learned counsel appearing for the petitioner vehemently argues the following points for the invalidation of impugned order; (i) Rescinding of technical bid with retrospective effect is impermissible, once matter has proceeded further in the tender process. (ii) Even otherwise, the rescinding ought to have been proceeded by a show-cause notice and that having not happened, there is violation of principles of natural justice. (iii) The employer under Clause-28 of the tender document has discretion to retain the contract even when there is violation of Page 1 of 4 Signature Not Verified Digitally Signed Signed by: ROJALIN NAYAK Designation: JUNIOR STENOGRAPHER Reason: Authentication Location: HIGH COURT OF ORISSA, CUTTACK Date: 16-May-2025 17:27:16 terms of tender, and that has not been adverted to in the impugned order. 4. Having heard the learned counsel for the Petitioner and having perused the petition papers, we decline indulgence in the matter for the following reasons: (a) The first contention that the petitioner ought to have been given an opportunity of hearing before terminating the contract and that having not been done, there is violation of principles of natural justice, does not merit acceptance for two reasons: (i) No foundational pleadings have been taken up by the petitioner to the effect that the ground on which the technical bid is cancelled, is non-existent or untruthful; (ii) Secondly, even before us it is not disputed that the petitioner had not disclosed in his tender application the “existing commitments”. Further, learned counsel for the petitioner tells us that his client had undertaken to discharge the existing commitments, if any. This cannot be construed as amounting to compliance of the condition in question. (b) There is another aspect to the invocation of principles of natural justice: ordinarily the principles of natural justice are treated as being part of Article 14 of the Constitution of India, is true. The conventional approach of the Courts earlier was that the violation of the principles of natural justice was actionable sans proof of prejudice vide S.L. Kapoor v. Jagmohan, AIR 1981 SC 136. However, law in this regard has marched from April to May and then to June of life. The principles of natural justice cannot be invoked ritualistically as Vedic Mantra. The invoker has to prima facie demonstrate that, had he been given an opportunity of hearing, he would have shown the premise on which the impugned action is structured, is wrong or non- Page 2 of 4 Signature Not Verified Digitally Signed Signed by: ROJALIN NAYAK Designation: JUNIOR STENOGRAPHER Reason: Authentication Location: HIGH COURT OF ORISSA, CUTTACK Date: 16-May-2025 17:27:16 existent. In other words, demonstrability some prejudice which the law can take cognizance of is a sine qua non for complaining the violation of natural justice principles. If hearing of the petitioner could not have altered the end result which the impugned order has brought about, then the complaint of non- hearing is not maintainable vide S.L. Kapoor (supra). (c) The next contention of the Petitioner that once the contract is at the conclusion stage, the preceding step, namely, clearance of technical bid cannot be reopened with retrospective effect, appears attractive at the first blush. However a deeper examination shows its hollowness: It is an admitted position that tender clause required disclosure of existing commitments and such a disclosure was not made, as already discussed above. Non-disclosure of such an important fact virtually amounts to suppressio very, which borders fraud. KERR ON FRAUD AND MISTAKE, 5th Edn. Pg-1, says as under:- “…It is not easy to give a definition of what constitutes fraud in the extensive significance in which that term is understood… Courts have always avoided hampering themselves by defining or laying down as a general proposition what shall be held to constritute fraud. Fraud is infinite in variety….” “Fraud vitiates everything”, said LORD EDWARD COKE centuries ago in Rex v. Duchess of Kingston, 20 How. St. Tr.544. Our Apex Court adopted this as a native norm as reiterated in S.P. Chengalvaraya Naidu v. Jagannath, AIR 1994 SC 853. To a great extent, all this applies to the suppression which the petitioner has committed, as discussed above. 5. Lastly, petitioner heavily relied upon Clause-28 of the tender document, which reads as under: “28. Employer’s Right to Accept any Bid and to Reject any or all Bids Page 3 of 4 Signature Not Verified Digitally Signed Signed by: ROJALIN NAYAK Designation: JUNIOR STENOGRAPHER Reason: Authentication Location: HIGH COURT OF ORISSA, CUTTACK Date: 16-May-2025 17:27:16 28.1 Notwithstanding Clause 27 above, the Employer reserves the right to accept or reject any Bid, and to cancel the bidding process and reject all bids, at any time prior the award of Contract, without thereby incurring any liability to the affected bidder or bidders or any obligation to inform the affected Bidder or bidders of the grounds for the Employer's action.” It is a settled position of law that COFUM, i.e., coercion, fraud, undue influence and mistake are the grounds on which the person may avoid a contract, which otherwise binds him. However, it is open to such a person to retain the contract in his discretion and wisdom. That has been engrafted in the above clause. That does not give any justiciable right in favour of the guilty party. He cannot he heard to say that the defrauded party should be compelled to maintain the contract. An argument to the contrary amounts to placing premium on illegality. No person can be permitted to take the advantage of his own wrong, be in the adage as old as mountains. In the above circumstances, no other ground having been urged, petition is liable to be and accordingly rejected in limine. (K.R. Mohapatra) Judge Rojalin (Dixit Krishna Shripad) Judge Page 4 of 4