State cannot arbitrarily withdraw a concluded EPC contract after inducing performance without establishing contractor default.

The Petitioner was awarded an Engineering, Procurement, and Construction (EPC) contract on 14.12.2022 for the "Traffic improvement and beautification work at OTS Crossing, Jaipur" for Rs. 184.30 Crores.

Although the Petitioner mobilized resources and submitted designs, the Respondent (JDA) failed to provide site approvals and land due to institutional objections from MNIT and OTS.

JDA granted a time extension until 30.04.2024 without penalty but subsequently issued a letter on 24.04.2024 withdrawing the entire work under Clause 32 of the Contract (RPWR-100).

Following this, JDA returned the Petitioner’s bank guarantees unconditionally.

While the first writ petition challenging the withdrawal was pending, JDA issued a fresh Notice Inviting Bid (NIB) on 03.04.2025 for a new Detailed Project Report (DPR) covering the same site.

Article 14 of the Constitution, which mandates that all State actions, including contractual ones, must be fair and non-arbitrary.

Writ jurisdiction is available for contractual obligations involving a "public law element" or State arbitrariness as held in ABL International Ltd. v. Export Credit Guarantee Corp.

The "Doctrine of Promissory Estoppel" binds the State when a party alters its position based on a promise per IFGL Refractories Ltd. v. Orissa State Financial Corp.

A statutory order must be judged solely by the reasons mentioned within it and cannot be supplemented by affidavits as per the Mohinder Singh Gill principle.

A change in Government does not justify rescinding a contract unless the original act was unlawful or against public interest as per State of Tamil Nadu v. K. Shyam Sunder.

The court found the maintainability objection failed because the Petitioner's Managing Director was duly authorized, and the case involved a "public law element"—the arbitrary exercise of power by a State instrumentality.

The Court noted that JDA's own internal note-sheets admitted the delay was due to site constraints (MNIT/OTS objections and tree felling) rather than Petitioner default.

Invoking Clause 32 (a penal provision for contractor default) was illegal because JDA had paradoxically granted extensions without penalty and returned bank guarantees, essentially waiving any claim of breach.

The Court observed that the fresh NIB for a new DPR was an attempt to bypass the subsisting contract due to a "change in policy" following a change in Government, which is prohibited under the rule of law.

The Court criticized JDA for not using the contract's "variation clause" to modify the scope instead of total withdrawal.

The Court allowed the writ petitions and quashed the withdrawal order dated 24.04.2024 and the fresh NIB dated 03.04.2025.

The Respondents were directed to proceed with the original project, consider price variations, and ensure implementation according to the original policy vision.

The Chief Secretary of Rajasthan was directed to conduct an inquiry into the "prima facie misrepresentation" by the Officers-in-Charge whose court submissions contradicted their internal records.