Failure to fulfill mandatory performance security conditions precludes judicial interference in subsequent fresh tender processes.

The Petitioner, a Class A contractor, participated in tender processes initiated by the Public Works Department (PWD) under NITs dated 07.11.2025.

Following the issuance of a Letter of Intent (LOI) on 17.02.2026, the Petitioner was required to furnish additional performance security.

The Petitioner alleged that before the expiry of the 15-day compliance period, the Respondent authorities cancelled the award and issued fresh NITs on 09.03.2026.

The Petitioner approached the High Court seeking to set aside the fresh NITs, to be permitted to comply with the original LOI, and to prevent the forfeiture of security deposits or the suspension of their registration under Clause 4.7.1 of the tender conditions.

1. Whether the Respondent's issuance of a fresh NIT and the potential imposition of penalties under Clause 4.7.1 were premature or legally unsustainable.

2. Whether the Court should exercise its writ jurisdiction to interfere with the tender process and direct the award of the contract to the Petitioner.

The Court considered the administrative provisions of the Notice Inviting Tender (NIT), specifically Clause 4.7.1, which mandates a temporary suspension of registration for two years as a consequence of failing to comply with NIT provisions.

It adhered to the principle of judicial restraint in contractual matters, particularly where the administrative authority has not yet taken a final adverse decision against the party.

The Petitioner contended that the cancellation of the tender was arbitrary as it occurred before the expiry of the mandatory 15-day period for furnishing performance security.

The Respondents argued that the Petitioner failed to fulfill a fundamental condition of the NIT regarding performance security and asserted that while Clause 4.7.1 consequences might follow, no formal decision regarding suspension or forfeiture had been finalized.

The Court observed that since no final adverse action had been taken against the Petitioner’s registration or security deposit, and the State had already initiated a fresh tender process, there was no immediate ground for judicial intervention.

The Court determined that the matter was not ripe for interference at the current stage.

The Court held that the Petitioner is at liberty to seek legal recourse in the future should a fresh cause of action arise, such as the formal passing of a suspension or forfeiture order.

No order as to costs was made.