Courts must exercise restraint and not quash tender awards over minuscule score differences absent manifest arbitrariness.

The first respondent, GPPC, a gas-based power company, floated a public tender in January 2025 for the operation and maintenance (O&M) of its plant using a Quality and Cost Based System (QCBS) with a weightage of 70% for technical evaluation and 30% for financial evaluation

Following evaluation, the Appellant (Steag) scored 95/100 technically, while the Writ Petitioner (OMS) scored 93/100

Steag was declared the successful bidder, and a Letter of Award (LOA) was issued on 09.06.2025

OMS challenged the process in the Gujarat High Court, which directed a re-evaluation of technical bids by a consultant

The re-evaluation reduced Steag’s technical score by two marks due to a timing discrepancy in experience documents, resulting in a tie where both bidders scored 93

Due to this tie, the High Court compared the financial bids and found OMS’s quote marginally lower than Steag’s (a difference of 0.00205301 in the final score)

Consequently, the High Court quashed Steag's LOA and directed GPPC to award the contract to OMS

Steag appealed this decision to the Supreme Court.

The Court applied the settled principles of judicial review in contractual matters, primarily relying on Afcons Infrastructure Ltd. v. Nagpur Metro Rail Corpn. Ltd., which holds that interference is permissible only if the decision-making process is mala fide, intended to favour someone, or so arbitrary that no responsible authority could have reached it

It further invoked the "principle of restraint" and "free play in the joints" established in Montecarlo Ltd. v. NTPC Ltd., emphasizing that technical evaluations by experts should not be lightly substituted by the Court

Additionally, the Court applied the caution from Tata Motors Ltd. v. BEST, stating that courts should not use a "magnifying glass" to find small mistakes in tenders to set aside contracts already underway

The Supreme Court observed that the High Court found no inherent arbitrariness or illegality in GPPC’s original decision but intervened solely because a re-evaluation created a technical tie

The Court reasoned that judicial review must balance "certainty in the market with fair play in action" and should not be reduced to mathematical precision or rigid formulae in highly competitive bidding

It noted that the difference in scores (0.00205301) was "miniscule" and did not warrant quashing a contract that had already seen mobilization of manpower and machinery

The Court criticized the "intense inquiry" into contested facts, noting that constitutional courts should not exercise ex-ante jurisdiction to pre-empt executive actions or ignore the Owner’s right to accept or reject bids as per Clause 23.1

The Court concluded that the High Court ignored the "Owner's" need for pragmatism and speed in project execution, especially since over a year had passed since the LOA

It held that there was no justification to interfere with the LOA dated 09.06.2025 and the subsequent contract dated 01.07.2025, upholding Steag’s appointment

However, the Court dismissed the appeal regarding the claim for additional marks under Clause 4 of 20.02(B), affirming the High Court’s factual findings on that specific technical parameter

GPPC was directed to proceed with the contract performance without hindrance