High Court held that judicial restraint is necessary in disputes pertaining to public tenders and quashed the trial court order refraining the Airport Authority of India (AAI) to debar a company M/S Saptagiri Restaurant Pvt Ltd. from participating in tenders for future three years.
Justice V C Koul has set aside the order of court below whe
n AAI was restrained from debarring the restaurant-bidder in participating in future tenders for three years.
The dispute arose between the restaurant bidder and AAI when AAI issued a debarment order barring SRPL from participating in future tenders for three years due to its alleged involvement in collusive bidding and bid-rigging.
The bidder-company challenged the order before the Additional District Judge (Fast Track), Budgam, securing an interim injunction that stalled AAI’s action, prompting AAI to challange the trial court order in an appeal before the High Court.
Justice Koul ruled that courts must refrain from interfering with statutory bodies’ regulatory decisions unless clear illegality or mala fide intent is established, warning that such interference risks undermining public contracts and policy enforcement.
“…before entertaining a petition and passing any interim orders in such petitions, the court must carefully weigh conflicting public interests. Only when it comes to a conclusion that there is an overwhelming public interest in entertaining the petition, the court should intervene. The same considerations must weigh with the court when interim orders are passed in such petitions,” HC said.
The Court rapped the bidder-SRPL for pursuing multiple remedies simultaneously. SRPL had filed writ petitions in the Madras High Court and the Punjab & Haryana High Court, challenging similar debarment orders.
The Court held that once SRPL chose to approach the Dispute Resolution Committee (DRC) in Amritsar, it could not simultaneously pursue a civil suit in Srinagar.
Senior Advocate Rajiv Shakdher, representing AAI, argued that the debarment was a statutory action undertaken within the framework of AAI’s contractual and regulatory authority and the courts must respect the autonomy of public bodies in managing tenders and contractual compliance.
Justice Koul said the AAI is a statutory body and is entrusted with maintaining the integrity of the tender process and held that any interference with AAI’s decisions should be minimal, especially when public interest is involved and cautioned against granting interim orders that could delay public projects and escalate costs.
With these findings and facts, the Court quashed the injunction granted by the Trial Court and upheld AAI’s debarment order, maintaining that SRPL remains barred from participating in tenders for the stipulated three-year period.
