Executive discretion in structuring and clubbing public tender packages is not subject to judicial interference.

The Petitioner, an unemployed engineer and Class-III contractor registered with the Rural Works Department, Bihar, challenged the Notice Inviting Tenders (NIT) Nos. RRSMP-03/2024-25, RRSMP-07/2024-25, and RRSMP-08/2024-25

The Petitioner alleged that the State’s decision to club multiple roads into large packages under the Rural Road Strengthening and Management Program (MMGSUY) increased the tender values beyond the permissible limit for Class-III contractors, effectively excluding them from participation

The Petitioner contended this violated existing government policies (Memo No. 1399/2008 and Letter No. 2390/2015) which intended to reserve 15% of work for unemployed engineers

The State defended the packaging as a policy decision necessitated by the magnitude of the seven-year maintenance scheme

1. Whether the High Court, under Article 226, can direct the State to provide a specific 15% reservation for unemployed engineers or interfere with the packaging of works in a public tender

fixation of tender conditions and procurement methodology falls within the exclusive domain of the executive

Tata Cellular v. Union of India, establishing that judicial review is limited to the legality of the decision-making process rather than the merits of the decision

Jagdish Mandal v. State of Orissa, which mandate that courts should not interfere in commercial transactions of the State unless the process is mala fide, arbitrary, or irrational

Michigan Rubber (India) Ltd. v. State of Karnataka and Silppi Constructions Contractors v. Union of India, emphasizing that greater latitude must be conceded to State authorities in formulating tender qualifications to ensure public interest and project capacity

The Court reasoned that the restructuring of tenders into block-wise or sub-division-wise packages was a deliberate administrative policy aimed at the efficient long-term maintenance (seven years) of rural roads

The Court found that simply because the scale of the packages made the Petitioner ineligible, it did not render the tender conditions arbitrary or unconstitutional

The Court noted that the State had broadened participation by allowing Joint Ventures (JV) and relaxing eligibility

Regarding the 2008 and 2015 government memos, the Court held that while they reflect policy intent, they do not create an enforceable legal right to compel the State to structure large-scale infrastructure projects in a manner that mandates reservation for a specific class of contractors

The Court determined that interfering with the packaging of works would amount to encroaching upon the executive's policy domain

The Court concluded that the tender conditions were not shown to be arbitrary or mala fide. Consequently, the writ application was dismissed