M/S Konkan Railway Corporation Ltd. Thru. Authorised Representative Mr. Om Prakash Verma vs Union Of India, Thru. General Manager, North Eastern Railway U.P. And 5 Others

A.F.R.
HIGH COURT OF JUDICATURE AT ALLAHABAD
LUCKNOW
WRIT - C No. - 7099 of 2026
M/S Konkan Railway
Corporation Ltd. Thru.
Authorised Representative Mr.
Om Prakash Verma
.....Petitioner(s)
Versus
Union of India, Thru. General
Manager, North Eastern Railway
U.P. And 5 other.
…..Respondents(s)
Counsel for Petitioner(s) : Alok Kumar Singh
Counsel for Respondent(s) : A.S. G. I.
Court No. - 3
HON'BLE SHEKHAR B. SARAF, J.
HON'BLE ABDHESH KUMAR CHAUDHARY, J.

1. Heard Sri Sudeep Seth, learned Senior Advocate assisted by Sri Alok
Kumar Singh and Sri Kazim Ibrahim, learned counsel for the petitioner
and learned counsel appearing on behalf of the Respondent No.1 to3
(North Eastern Railways, Gorakhpur) and Ms. Aishwarya Shukla,
learned counsel for the respondent no. 5 (M/s. Rail Vikas NigamLtd.).
2. This is a writ petition under Article 226 of the Constitution of India,
wherein the writ petitioner has sought for the following substantial
reliefs:-

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"i. Issue a writ, order or direction in the nature of Certiorari
quashing the impugned letter dated 08.06.2026, styled as
"Rejection and non-opening of financial bid due to
technical/legal consideration"(see Annexure No. 1-as
communicated to the Petitioner via WhatsApp on 08/06/2026);
ii. Issue a writ, order or direction in the nature of mandamus
directing the Respondent No. 2 to evaluate the Financial Bid of
the Petitioner (Annexure No. 18; Page 211), in compliance of
the order dated 29.05.2026 of this Hon'ble Court, passed in
Writ C No. 5810 of 2026;
iii. Issue, in view of the law as clarified by order dated
29.05.2026 of this Hon'ble Court, passed in Writ CNo. 5810 of
2026, a writ, order or direction in the nature of mandamus
directing the Respondent No. 2 to accept the amended Bank
Guarantee, dated 18.06.2026, submitted by the Petitioner after
removal of the curable defect as pointed out in impugned letter
dated 08.06.2026;
iv. Issue a writ, order or direction in the nature of mandamus
directing the Respondent No. 2 to proceed further tender
process including declaration, execution and issuance of work
order, or taking of any other consequential action in the tender
process."
3. Learned Senior counsel for the petitioner has submitted that in spite of
orders of this Court, which were passed on various occasions and finally
on May 29, 2026 in the earlier round of litigation relating to the present
tender in question, the authorities have acted malafidely and has now
sought to reject the bid of the petitioner on a rather uncanny manner and
on an absolutely new ground that the name of the beneficiary in the bank
guarantee is incorrect.
4. It is to be noted that the petitioner, which is a Government enterprise,
had been off and on being forced to knock the doors of this court
complaining procedural unfairness against the respondent railway
authorities in the tendering process of providing “Design, Supply,
Erection, Testing & Commissioning of Traction Sub Stations with
associated Switching Posts for 2x25 KV AT traction feeding system in
Gorakhpur Cant.-Chapra Gramin section of Varanasi Division of North
Eastern Railway for capacity upgradation work of electric traction power

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WRIC No. 7099 of 2026
supply installations”, on EPC Mode at an estimated cost of INR 262.12
Crores.
5. Apparently, the petitioner filed a writ petition on earlier occasion
challenging that their bid had been rejected without any reason.
However, subsequently, when this Court intervened, the contesting
Respondents No.1 to3, sprung with a reason for rejection of the bid of
the petitioner on the ground that the bank guarantee provided by the
petitioner did not have appropriate amount of stamp duty. The said
matter was argued at length and it is surprising at that point, learned
counsel for the contesting respondents did not point out that the name of
the beneficiary in the said bank guarantee was incorrect. If the same had
been pointed out at that relevant time, similar directions would have
been given to the petitioner to issue the bank guarantee in the name of a
correct beneficiary.
6. Albeit, since there was not even a whisper or an iota of mention
relating to the name of the beneficiary as mentioned in the bank
guarantee to be incorrect, this Court finding that the ground of non-
payment of adequate stamp duty on the said Bank Guarantee, as being
agitated by the Respondent railways authorities to be a curable defect,
permitted the petitioner to make good the said deficiency within a
stipulated time vide an order dated 29.05.2026 passed in WRIT - C No. -
5810 of 2026 (M/S Konkan Railway Corporation Ltd. Thru. Auth. Mr.
Om Prakash Verma Vs.Union Of India Thru. General Manager
(N.E.R.) Gorakhpur U.P. And 5 Others); which also held as follows:
“10 . In any case, the above reason, namely that adequate
stamp duty had not been paid in accordance with the U.P.
Stamp Act, in our view, is at the most a lacuna and a curable
defect which could have been sought to be cured by the
authority concerned. It is further to be noted, as pointed out
by Sri Sudeep Seth, learned Senior Advocate appearing on
behalf of the petitioner, that in the past, for another tender, a
similar bank guarantee of Rs.500/- had been accepted and
the financial bid of the petitioner had been opened, wherein
the petitioner had been declared L-3. These documents are

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annexed at Page Nos.159 and 163 of the supplementary
affidavit.
11 . In light of the above, it appears that the action of the
authorities is mala fide and is merely an attempt to eliminate
the petitioner, who has submitted the lowest financial bid.
12 . As regards the contention of the learned counsel for the
respondents that financial bid had been opened, it has to be
understood that it is well settled that a bidder, even if
declared the highest bidder, does not for that reason alone
obtain an indefeasible right to insist upon award of the
contract. Until the process matures into a concluded
contractual relationship in accordance with the governing
tender conditions, the bidder's position remains provisional.
The Supreme Court in Meerut Development Authority v.
Assn. of Management Studies reported in (2009) 6 SCC 171
has held that State or authority under Article 12 of the
Constitution of India is not bound to accept bid of L1 bidder,
but is only bound to act without arbitrariness and
favouristism. The relevant paragraphs of the aforesaid
judgment are delineated below:-
"27. The bidders participating in the tender process
have no other right except the right to equality and fair
treatment in the matter of evaluation of competitive
bids offered by interested persons in response to notice
inviting tenders in a transparent manner and free from
hidden agenda. One cannot challenge the terms and
conditions of the tender except on the abovestated
ground, the reason being the terms of the invitation to
tender are in the realm of the contract. No bidder is
entitled as a matter of right to insist the authority
inviting tenders to enter into further negotiations
unless the terms and conditions of notice so provided
for such negotiations.
*
29 . The Authority has the right not to accept the
highest bid and even to prefer a tender other than the
highest bidder, if there exist good and sufficient
reasons, such as, the highest bid not representing the
market price but there cannot be any doubt that the
Authority's action in accepting or refusing the bid must
be free from arbitrariness or favouritism." ”
7. Upon perusal of the record, it appears that the adequately stamped
bank guarantee was duly provided by the petitioner as directed by this
Court vide its order dated 29.05.2026 passed in M/S Konkan Railway
Corporation Ltd. (Supra). However, surprisingly, the said bank
guarantee came to be returned to the petitioner on 08.06.2026 stating that

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it was in the name of incorrect beneficiary. Admittedly, the petitioner
once again submitted the bank guarantee in the name of correct
beneficiary on 19.06.2026 but again the same was returned to the
petitioner on the ground that the bank guarantee had been submitted
belatedly.
8. From the scrutiny of the documents and the manners in which the
respondent- authorities are approaching this particular tender, it appears
to this Court that they are fixated to not allow the petitioner to participate
in the tender on one ground or the other. All the defects, which had been
pointed out by the authorities are curable defects and such defects could
have been pointed out at much earlier stage. In our view, the
ground/certain defects for rejecting the tender of the petitioner are
curable and thus, the rejection is clearly in gross violation of principles
of natural justice and against the established principles of law.
9. We have already dealt the same issue in our judgment dated May 29,
2026 relying on several judgments of the Hon'ble Supreme Court. On the
earlier occasion, we have also observed that the discriminatory acts of
the respondent-authorities were malafide and was merely an attempt to
eliminate the petitioner, who had submitted a lowest financial bid. The
said reasoning of this Court applies with equal force to the issue being
raised in the present writ petition. Further, the findings stand vindicated
from the fact that own showing of the respondent-authorities, the
issuance of a Bank Guarantee in an incorrect name has been found to be
a curable defect, which can be remedied even during the currency of the
contract, not to talk during the bidding period. We find that the
“Southern Railway, Chennai” an arm of the present contesting
respondents (North Eastern Railways, Gorakhpur), when faced with an
identical situation for a work of similar nature awarded, permitted the
present petitioner to carry the necessary correction in the name of the
beneficiary in a Bank Guarantee. The said letter dated 09.03.2026 issued

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by the Southern Railways to the petitioner would show that after the
issuance of LOA dated 29.01.2026 i.e after the bidding culminated and
the Bank Guarantee was provided by the petitioner on 07.02.2026, the
southern railways returned the said Bank guarantee by the said letter
requiring the petitioner to carry necessary correction relating to the name
of the beneficiary in that Tender. The said letter has been filed by the
petitioner and the same is being referred in the present order for the
simple reason to show the admitted position that the railways have
themselves acknowledged that said corrections in the name of the
beneficiary of Bank Guarantee to be a curable defect. The scanned copy
of the said letter is as follows:-

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WRIC No. 7099 of 2026
10. Having considered the facts and circumstances, we are rather amused
as to how there can be a two different yard-stick for two arms of the
same organization. We need not burden this judgment with the law on
the subject that the railways being a ‘state instrumentality’ needs to
function uniformly and fairly. The acts of the respondent North Eastern
Railways Authorities besides being arbitrary smacks of malafide and are
whimsical. They ought to have spelt the inaccuracy in the name of the
beneficiary of the Bank guarantee in the very first instance. As a model
employer they cannot chose to play hide and seek. Apparently, the acts
are nothing short of harassment, which is not permissible under any law.
It seems the respondent authorities are hell-bent to oust the
legitimate  participation of the petitioner in the tendering process for
obvious reasons, which cannot be permitted in any circumstances.
11. In light of the same, we are once again constrained to hold that the
acts and omissions of the Respondent railway authorities in not
permitting the petitioner to participate in the financial bid to be illegal
and without any force of law. Consequently, the impugned letter dated
08.06.2026 is hereby quashed and set-aside and the Respondent No.2 is
directed to evaluate the Financial bid of the petitioner in compliance of
our order dated 29.05.2026 in M/S Konkan Railway Corporation Ltd.
Thru. Auth. Mr. Om Prakash Verma (Supra), after accepting the
corrected beneficiary’s name in the Bank guarantee within a period of
three working days from today and accordingly thereafter proceed
further in the tender process.
12. With the above direction, the writ petition is disposed of .
(Abdhesh Kumar Chaudhary, J.) (Shekhar B. Saraf, J.)
July 08, 2026
Anuj Singh
Digitally signed by :-
ANUJ PRATAP SINGH
High Court of Judicature at Allahabad,
Lucknow Bench