New Delhi: The Supreme Court has upheld a Punjab and Haryana High Court order disqualifying the highest bidder in a Mandi user-charges tender, holding that its experience of running cattle fairs as a lessee did not satisfy the tender's requirement of two years' experience collecting user charges on behalf of a government body.
A Bench of Justices Alok Aradhe and K.V. Viswanathan was hearing two connected civil appeals, filed by Micky Traders (the H1 Bidder, arising out of SLP(C) No. 22161 of 2026) and by the Punjab State Agricultural Marketing Board and Market Committee, Ludhiana (arising out of SLP(C) No. 23127 of 2026), against a common order dated 27.05.2026 of the Punjab and Haryana High Court in CWP No. 8671 of 2026.
The Market Committee, Ludhiana, invited bids for collecting user charges at Mandi premises for one year. Micky Traders quoted the highest amount and was declared H1, while L.R.Y. Labour Contractor, the second-highest bidder, objected that Micky Traders lacked the requisite two years' experience of user-charge collection under Clause 9(c)(a) of the Board's enlistment instructions, its certificates instead showing participation in cattle fairs. Despite the objection, a Letter of Acceptance was issued to Micky Traders, prompting L.R.Y. to file a writ petition. The High Court held that the cattle-fair experience did not satisfy Clause 9(c)(a), quashed the acceptance of Micky Traders' bid, and directed issuance of a fresh Letter of Acceptance to the eligible bidder, leading to the present appeals by Micky Traders and by the Board.
Counsel for Micky Traders argued that the High Court exceeded the limited scope of judicial review in tender matters by substituting its own interpretation for that of the tendering authority, absent any finding of mala fide or perversity, and that Clause 9(c)(a) required only two years' experience at some point before 31.12.2025, not a continuous contract ending in that month. It was submitted that experience of firms in which Micky Traders' proprietor was a partner could be attributed to him, and that rejecting the higher bid would cause public revenue loss.
Counsel for the Board supported this position, submitting that the enlistment instructions were merely directory and that the tendering authority's commercial wisdom should not be disturbed absent illegality or bias.
Senior Counsel for L.R.Y. Labour Contractor submitted that none of Micky Traders' certificates were in its own name, related to unrelated third-party firms, and that a cattle-fair lessee merely pays rent and does not "collect" a statutory user charge on a government body's behalf. It was also pointed out that Micky Traders' bids had been rejected on an identical clause by two other Market Committees, which it never challenged.
Reiterating the settled, narrow scope of judicial review in tender matters from Tata Cellular, Jagdish Mandal, Silppi Constructions and Agmatel India, the Court held that a tendering authority's reading of its own document is ordinarily final unless that reading is dehors the terms of the tender or patently arbitrary, as recognised in Kimberley Club (P) Ltd.
On facts, the Court held that collecting user charges under a twelve-month, Rs. 16-crore Mandi contract is a specialised, accountable, revenue-facing role, fundamentally different from organising a cattle fair as a lessee who pays rent for the privilege, and that treating the two as equivalent disclosed no genuine application of mind to Clause 9(c)(a). It further held that the certificates relied upon were not in Micky Traders' own name and that no partnership deed or other proof was produced to establish the claimed nexus with the firms named in them.
The Court also held that Micky Traders could not approbate and reprobate, having earlier accepted, by not challenging, the same disqualifying interpretation of an identical clause when applied against it by two other Market Committees. It rejected the argument that the higher bid amount should override eligibility, holding that revenue considerations cannot cure ineligibility, and found the enlistment instructions were mandatory in substance, since the Committee itself had rejected bidders who furnished no certificate at all.
Finding no infirmity in the High Court's order, the Court dismissed both appeals with no order as to costs, and disposed of pending interlocutory applications.
Appearances:
For Micky Traders (H1 Bidder): Mr. Siddhartha Iyer, Advocate.
For the Board and Committee: Mr. Jagjit Singh Chhabra, Advocate.
For L.R.Y. Labour Contractor (H2 Bidder): Mr. Amit Rawal, Senior Advocate.
Case Title: Micky Traders vs. L.R.Y. Labour Contractor & Ors., Civil Appeal arising out of SLP(C) No. 22161 of 2026, with Civil Appeal arising out of SLP(C) No. 23127 of 2026
