Facts
The Petitioner participated in an e-auction conducted by Respondent No. 2 (DSIIDC) on 06.09.2024 for Industrial Plot No. 5/1/11-81 in the Bawana Industrial Area
Source reference: p. 2A Letter of Intent (LoI) was issued in favour of the Petitioner on 16.12.2024
Source reference: p. 2Subsequently, DSIIDC issued an impugned communication dated 26.06.2025 withdrawing/cancelling the LoI, stating it was issued under a misconception because the Petitioner’s bid of Rs. 1,91,30,000/- was lower than the required threshold value
Source reference: p. 2The Petitioner approached the Court seeking to quash the withdrawal letter and a mandamus for allotment ten months after the cancellation
Source reference: p. 2, 3Issues
1. Whether the issuance of a Letter of Intent (LoI) creates an indefeasible or vested right in favour of the bidder to claim allotment of property
Source reference: p. 22. Whether the Petitioner is entitled to discretionary relief under Article 226 despite a ten-month delay in approaching the Court
Source reference: p. 3Law Applied
The Court applied the principle that a Letter of Intent is merely a precursor to a contract and does not constitute a binding legal relationship
Source reference: p. 2It relied on State of H.P. v. OASYS Cybernatics (P) Ltd. (2026) 3 SCC 348, which synthesized precedents such as Rajasthan Coop. Dairy Federation Ltd. v. Maha Laxmi Mingrate Mktg. Service (P) Ltd. and Dresser Rand S.A. v. Bindal Agro Chem Ltd. to establish that an LoI is a "promise in embryo" and creates no juridical entitlement until final and unconditional acceptance
Source reference: p. 3The Court applied principles of equity regarding laches/delay in writ jurisdiction
Source reference: p. 3-4Reasoning
The Court reasoned that since the Petitioner only held an LoI, no vested rights had accrued that would prevent the Respondent from correcting a mistake
Source reference: p. 2By applying the OASYS Cybernatics doctrine, the Court noted that an LoI does not bind the State to a contract before it has consciously chosen to be bound, particularly when the bid did not meet the threshold value
Source reference: p. 3Regarding the procedural history, the Court rejected the Petitioner’s justification for a ten-month delay—claimed to be due to "informal communications"—finding the explanation unsatisfactory and the petition belated
Source reference: p. 3-4Holding
The Court dismissed the writ petition, holding that the Petitioner had no indefeasible right to the property based on the LoI and that the challenge was barred by laches
The Court clarified that any future re-allotment must follow applicable policy. However, liberty was reserved for the Petitioner to seek damages through appropriate legal proceedings if any loss was suffered
Source reference: p. 3, 4Original Court PDF
Sumit KumarvsGovt. Of Nct Of Delhi & Anr.
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