Karnataka HC Quashes Hospital’s All-Items Re-Tender, Allows Fresh Bids Only For Dustbin Bags After Tender’s Unit-Rate Error

In brief

The question

Whether the petitioner, as the claimed L-1 bidder for Item No. 18, had a right to compel the authority to award that item under the original tender despite the stated error in the unit of measurement

The court held

The petition was allowed in part.

It also directed

The Court quashed the fresh tender notification dated 22 April 2026 because it covered all items, and permitted respondent No. 2 to invite a fresh tender only for Item No. 18. The petitioner and other bidders were permitted to participate in that fresh tender

01Facts

Respondent No. 2 invited tenders on 21 November 2025 for 35 items. The petitioner received work orders for 16 items; other successful L-1 bidders received orders for the remaining items, except Item No. 18, for which no work order was issued

pp. 5–6

Respondent No. 2 stated that the e-portal incorrectly specified the unit for Item No. 18 as “each” instead of per kilogram, making the quoted rates liable to cause substantial loss if accepted. It therefore decided to retender that item, but issued a fresh notification on 22 April 2026 covering all items

pp. 5–7

The petitioner sought, among other reliefs, an award of Item No. 18 at its claimed L-1 rate and challenged the fresh notification

pp. 2–4

02Issues

i.Whether the petitioner, as the claimed L-1 bidder for Item No. 18, had a right to compel the authority to award that item under the original tender despite the stated error in the unit of measurement

pp. 5–7

ii.Whether the authority could retender all items when work orders had already been issued for the other items, or whether the retender should be confined to Item No. 18

pp. 6–7

03Law Applied

Article 226 was invoked to seek judicial review of the tender decisions; Article 14 was pleaded in the challenge to the terms of the fresh tender

pp. 2–4

It applied the principle that a bidder has no vested right to receive a contract merely by participating in a tender or being L-1

p. 6

It also held, on the circumstances before it, that the authority’s decision to retender because of an error affecting Item No. 18 did not justify retendering items for which work orders had already been issued

pp. 6–7

04Reasoning

The Court accepted the authority’s explanation that the portal’s incorrect unit for Item No. 18 could make an award on the submitted rates financially disadvantageous, and concluded that bidders could not insist on receiving that contract

pp. 5–6

However, since work orders had been issued for the other items, the Court found the all-item retender impermissible. The appropriate course was to invite fresh bids only for Item No. 18, the item affected by the error

pp. 6–7

The Court did not direct an award to the petitioner at its claimed L-1 rate