M/S Hariway Lines Pvt. Ltd. vs The State Of Madhya Pradesh

NEUTRAL CITATION NO. 2026:MPHC-JBP:82701
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IN THE HIGH COURT OF MADHYA PRADESH
AT JABALPUR

BEFORE
HON'BLE SHRI JUSTICE ALPESH Y. KOGJE,
CHIEF JUSTICE
&
HON'BLE SHRI JUSTICE VIVEK JAIN
th
ON THE 12 OF OCTOBER, 2026
WRIT PETITION No. 41832 of 2026
CNR No.: MPHC010741672026
M/S HARIWAY LINES PVT. LTD.
Versus
THE STATE OF MADHYA PRADESH AND OTHERS
Appearance:
Shri Prakash Upadhyay - Senior Advocate with Shri Ravindranath
Chaturvedi and Shri B. Raja - Advocates for petitioner.
Shri Vivek Sharma - Deputy Advocate General for respondents-State.
Shri Anvesh Shrivastava - Advocate for respondents No.2 and 3.
ORDER
Per: Hon'ble Shri Justice Alpesh Y. Kogje, Chief Justice
The present petition is filed under Article 226 of the Constitution of India
for quashing of a communication dated 28.09.2026 whereby the petitioner was
declared ineligible to participate in the tender process pursuant to NIT dated
17.04.2026 and also seeking direction to include the petitioner in the tender
process.
2. The tender was issued for providing and erection of single roller crash barrier
and road safety, which according to learned counsel for the petitioner, the
petitioner is the only Indian manufacturer whereas the others are manufacturers
abroad. Learned counsel has submitted that the only reason why the petitioner is
Signature Not Verified
Signed by: SACHIN
CHAUDHARY
Signing time: 16-10-2026
12:39:02

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held to be disqualified and that too at the stage of technical bidding, is the

requirement of a valid registration with the Government of Madhya Pradesh. He
has argued that acting on a complaint the respondent-authority has travelled
beyond the scope of NIT to enquire about the details of the registration of the
petitioner with the M.P. State authority and unilaterally treated him to be
disqualified. According to him, the eligibility for a bidder was not specifically
having a valid registration with the Government of Madhya Pradesh but those
bidders who are not registered with the Government of Madhya Pradesh and are
eligible for registration could also submit their bids after having applied for
registration with the appropriate authority. The petitioner was fulfilling this
requirement. Despite this, on the basis of a complaint apparently by an interested
person made enquiry with the registering authority and based on what is reflected
on the website of such authority of State of Madhya Pradesh, unilaterally decided
the petitioner to be ineligible. Based on such decision, though there is no stage as
per the NIT, the amount of EMD has also been refunded. This shows a mala fide
intention in excluding the petitioner from the race of bidding.
3. On the other hand, learned counsel for the respondents submitted that the
authority was justified in treating the bid of the petitioner as ineligible as the
eligibility for the bidders specified in NIT specifically required the registration
with the Government of Madhya Pradesh or the application for registration being
made with the Government of Madhya Pradesh. In the case of the petitioner, such
an application though made, was reflected on the website of the concerned
authority that such a registration application of the petitioner is non-active.
4. In rejoinder, learned counsel for the petitioner has drawn our attention to the
documents to indicate that the authority with which the petitioner is required to
register, has not communicated to the petitioner and had the authority informed the
Signature Not Verified
Signed by: SACHIN
CHAUDHARY
Signing time: 16-10-2026
12:39:02

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petitioner about his application for registration to be non-active then the petitioner

would have taken corrective steps as securing the registration with the State of
Madhya Pradesh is only a procedural aspect as the petitioner was otherwise
eligible in all respects.
5. Having considered the rival submissions of the parties and having perused the
documents on record, it is to be noted that the petitioner has participated in
the tender process pursuant to NIT dated 17.04.2026 issued by the Madhya
Pradesh Road Development Corporation for providing and erection of single roller
crash barrier and road safety on Matkuli-Pachmarhi Road between Km. 10 to
24(SH-41A) (2nd Call). It is the case of the petitioner that despite the bid was
submitted on 13.05.2026 after applying for fresh registration on 08.03.2026, and
its registration proposal was forwarded to Level-3 for processing on 14.03.2026,
after opening of the technical bids on 10.07.2026, the petitioner was called upon
to furnish justification regarding its registration status and subsequently vide
communication dated 28.09.2026 was declared ineligible to participate in the
tender in terms of Clause 4(a) of the NIT.
6. A perusal of Clause 4 of the said NIT shows that it specifically permits an
unregistered bidder, otherwise eligible for registration, to submit its bid after
applying for registration with the Government of Madhya Pradesh, while making
valid registration mandatory only at the stage of signing of the contract. Said
clause 4 reads as under:-
"4. ELIGIBILITY FOR BIDDERS:
(a) At the time of submission of the Bid the bidder should have valid
registration with the Government of Madhya Pradesh. However, such
bidders who are not registered with the Government of Madhya
Pradesh and are eligible for registration can also submit their bids after
having applied for registration with appropriate authority.

Signature Not Verified
Signed by: SACHIN
CHAUDHARY
Signing time: 16-10-2026
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(b) The bidder would be required to have valid registration at the time
of signing of the Contract.

(c) Failure to sign the contract by the selected bidder, for whatsoever
reason, shall result in forfeiture of the earnest money deposit.

(d) Subcontractors experience and resources shall not be taken into
account in determining the applicants compliance with the qualifying
criteria's."

7. According to the Court, the requirement, therefore, for the eligibility of the
petitioner was an application for registration with the appropriate authority, which
the petitioner was having. Thereafter, the requirement under Clause 4(b) was a
requirement of valid registration at the time of signing of contract. The issue of
signing of the contract would obviously be at the time when the bids are finally
decided after passing the technical bid, the financial bid and award of the contract
as per Clause 21 of the NIT. Clause 21 whereof provides for the employer to
notify the successful bidder by issuing a Letter of Acceptance (LoA) that his bid
has been accepted and under Clause 23, the signing of the contract agreement after
the successful bidder has furnished performance security and additional
performance security, if any and signed the contract within 15 days of issue of
LoA. Therefore, in the opinion of the Court the requirement of a valid registration
with the appropriate authority of the M.P. Government would arise as specified in
Clause 4(b) of the NIT. However, by the impugned communication at Annexure
P-7 wherein a reference is given to a letter dated 13.08.2026 by one Mr. Rohit
Patil, Dhar, on the basis of which the respondents embarked upon an enquiry with
the appropriate authority for registration and after taking cognizance of what is
reflected on the website of the appropriate authority, called for the information
from the appropriate authority, which communicated that the application for
Signature Not Verified
Signed by: SACHIN
CHAUDHARY
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registration by the petitioner having not been attended for 90 days is treated to be

de-active.
8. In the opinion of the Court, under the NIT there was no stage with the
respondents to embark upon such an enquiry and that too at the behest of an
unknown entity who made such a mischievous complaint. Though there is a
reasonable justification offered by the petitioner with regard to the "de-active"
status of application for registration, however, the same is not relevant for the
purpose of the present case as the relationship between the petitioner and the
respondent was on the basis of the NIT and the clauses applicable. As is held in
the preceding paras, the requirement of the registration would arise only at the
stage of signing of contract. There was no stage available for disqualifying the
petitioner on the basis of status of his application for registration with the
appropriate authority of the State of Madhya Pradesh. The only stage that is
provided under the NIT is clearly prescribed under Clause 19 of the NIT and
which does not specify any stage of enquiry for the purpose of ascertaining the
"active" or "de-active" status of the registration application.
9. Another aspect that catches attention is a hot haste in which the respondents
have repatriated the earnest money deposit which is evident from the account
statement of the State Bank of India A/c of the petitioner at Annexure P-12
wherein on 13.09.2026, the earnest money has been refunded. Whereas, according
to clauses of the NIT, particularly Clause 17.4 thereof, release of EMD would be
only after opening of the financial bid. For a ready reference, Clause 17.4 of the
NIT is reproduced as under:-

"17.4 EMD of all other bidders except L-1 bidder shall be released
immediately after opening of financial bid."
Signature Not Verified
Signed by: SACHIN
CHAUDHARY
Signing time: 16-10-2026
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9.1 Thus, this act of refund of earnest money deposit on the part of the

respondents appears to be an act in haste to drive the petitioner out of the race of
bidding.
10. The Supreme Court in the case of New Horizons Ltd. vs. Union of India
(1994 SCC OnLine SC 29) has observed as under:-

"At the outset, we may indicate that in the matter of entering into a
contract, the State does not stand on the same footing as a private
person who is free to enter into a contract with any person he likes. The
State, in exercise of its various functions, is governed by the mandate
of article 14 of the Constitution which excludes arbitrariness in State
action and requires the State to act fairly and reasonably. The action of
the State in the matter of award of a contract has to satisfy this
criterion. Moreover, a contract would either involve expenditure from
the State exchequer or augmentation of public revenue and
consequently the discretion in the matter of selection of the person for
award of the contract has to be exercised keeping in view the public
interest involved in such selection. The decisions of this court,
therefore, insist that while dealing with the public, whether by way of
giving jobs or entering into contracts or issuing quotas or licences or
granting other forms of largesse, the Government cannot act arbitrarily
at its sweet will and like a private individual, deal with any person it
pleases, but its action must be in conformity with the standards or
norms which are not arbitrary, irrational or irrelevant. It is, however,
recognised that a certain measure of “free play in the joints” is
necessary for an administrative body functioning in an administrative
sphere: See Ramana Dayaram Shetty v. International Airport Authority
of India, AIR 1979 SC 1628; (1979) 3 SCC 489, 505; (1979) 3 SCR
1014, 1034; Kasturi Lal Lakshmi Reddy v. State of Jammu and
Kashmir, AIR 1980 SC 1992; (1980) 4 SCC 1, 11; (1980) 3 SCR
1338, 1355; Fasih Chaudhary v. DirectorGeneral, Doordarshan(1989)
1 SCC 89, 92; 1988 Supp (3) SCR 282, 286; Sterling Computers Ltd.
v. M and N Publications Ltd.(1993) 1 SCC 445; Union of India v.
Hindustan Development Corporation(1993) 3 SCC 499, 513."

11. In Tata Cellular vs. Union of India , (1994) 6 SCC 651, the Supreme Court
while discussing the exercise of powers of judicial review by writ courts in
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CHAUDHARY
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contractual matters held in para-77 as under:-


"77. The duty of the court is to confine itself to the question of legality.
Its concern should be:

1. Whether a decision-making authority exceeded its
powers?
2. Committed an error of law,
3. committed a breach of the rules of natural justice,
4. reached a decision which no reasonable tribunal would
have reached or,
5. abused its powers.

Therefore, it is not for the court to determine whether a particular
policy or particular decision taken in the fulfilment of that policy is fair.
It is only concerned with the manner in which those decisions have
been taken. The extent of the duty to act fairly will vary from case to
case. Shortly put, the grounds upon which an administrative action is
subject to control by judicial review can be classified as under:

(i) Illegality : This means the decision-maker must
understand correctly the law that regulates his decision-
making power and must give effect to it.
(ii) Irrationality, namely, Wednesbury unreasonableness.
(iii) Procedural impropriety.

The above are only the broad grounds but it does not rule out addition
of further grounds in course of time. As a matter of fact, in R. v.
Secretary of State for the Home Department, ex Brind [(1991) 1 AC
696] , Lord Diplock refers specifically to one development, namely, the
possible recognition of the principle of proportionality. In all these
cases the test to be adopted is that the court should, “consider whether
something has gone wrong of a nature and degree which requires its
intervention”."
12. Considering the aforesaid, the Court is of the view that the impugned
communication holding the petitioner to be disqualified at the stage of technical
bid is an arbitrary decision and is, therefore, required to be interfered with.
Accordingly, the impugned communication dated 28.09.2026 (Annexure P-9) is
Signature Not Verified
Signed by: SACHIN
CHAUDHARY
Signing time: 16-10-2026
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set aside. The petitioner's bid is hereby declared to be eligible for being

considered at the stage of opening of technical bid. The petitioner is hereby
directed to pay the earnest money deposit which has been refunded and the
respondents are directed to accept such EMD amount as if there is no refund and
treat the bid of the petitioner in its due process.
13. Resultantly, the writ petition stands allowed.
(ALPESH Y. KOGJE)
(VIVEK JAIN)
CHIEF JUSTICE
JUDGE
S/

Signature Not Verified
Signed by: SACHIN
CHAUDHARY
Signing time: 16-10-2026
12:39:02