Withdrawal of bid within the validity period attracts stipulated forfeiture of earnest money as per tender conditions.

The Petitioner, a horticulture contractor, submitted bids for four tenders floated by Respondent No. 2 (PWD) on 27.08.2024 for maintenance and development work in the East Horticulture Division

The technical bids were opened the same day, i.e., 27.08.2024

On 30.08.2024, three days after the bids were opened, the Petitioner withdrew his bids on the ground that incorrect rates had been quoted

Consequently, the Respondents forfeited 50% of the Earnest Money Deposited (EMD) as per the tender conditions

The Petitioner challenged this forfeiture through the present writ petition

1. Whether the Petitioner’s withdrawal of bids within three days of opening, on the ground of quoting incorrect rates, attracts the consequence of forfeiture of 50% of the earnest money under the tender conditions

The Court applied the principles of judicial review in contractual matters involving government bodies, emphasizing limited intervention unless there is evidence of arbitrariness, mala fides, or irrationality, as established in Tata Cellular v. Union of India (1994) 4 SCC 651

It also relied on Jagdish Mandal v. State of Orissa (2007) 14 SCC 517, which clarifies that in commercial white-collar matters like tenders, principles of equity and natural justice may "stay at a distance" compared to the strict terms of the contract

The specific contractual rules applied were Clauses 21 and 32 of the Tender Document, which stipulate that withdrawal within seven days of opening the technical bid results in 50% EMD forfeiture

The Court observed that the Petitioner participated in the tender process with full knowledge of the terms and conditions

Under Clauses 21 and 32, the bids were required to remain valid for 75 days; however, any withdrawal within the first 7 days explicitly triggered a 50% forfeiture of EMD

Since the Petitioner admittedly withdrew the bids on 30.08.2024 (strictly 3 days post-opening), the Court found that the withdrawal "squarely attracted" the penal consequences predefined in the Notice Inviting Tender (NIT)

The Court rejected the Petitioner's reliance on subsequent communications (dated 06.09.2024), noting that contractual terms in commercial bids must be strictly followed and judicial review is restricted to the decision-making process rather than the merits of the commercial decision itself

The Court found no arbitrariness or violation of fundamental rights in the Respondents' action; Consequently, the petition was dismissed, upholding the forfeiture