Andhra Pradesh High Court - Amravati
Integral Trading And Logistics vs North-East Frontier Railway And ... on 8 May, 2026
Reserved on : 30.04.2026
Pronounced on : 08.05.2026
Uploaded on : 11.05.2026
APHC010103742026
IN THE HIGH COURT OF ANDHRA PRADESH
AT AMARAVATI [3330]
(Special Original Jurisdiction)
FRIDAY, THE EIGHTH DAY OF MAY
TWO THOUSAND AND TWENTY SIX
PRESENT
THE HONOURABLE SRI JUSTICE TARLADA RAJASEKHAR RAO
WRIT PETITION Nos. 5630, 5639 and 5646 of 2026
20
W.P. No.5630 of 2026
BETWEEN:
1. INTEGRAL TRADING AND LOGISTICS, VISAKHAPATNAM, A
REREGISTERED PARTNERSHIP FIRM, REP. BY ITS
MANAGING PARTNER, GRANDHI RAJESH, S/O. LATE
G.S.P.RANGA AGED ABOUT 49 YEARS. REGISTERED
ADDRESS AT FLAT NO.303, 3RD FLOOR, TIRUMALA PLAZA,
DHABA GARDENS, VISAKHAPATNAM. ....PETITIONER
AND
1. THE BOARD OF TRUSTEES OF VISAKHAPATNAM PORT
AUTHORITY VPA, (VPA) THROUGH ITS SECRETARY, PORT
AREA, VISAKHAPATNAM, ANDHRA PRADESH
PRADESH-530035
530035
2. THE VISAKHAPATNAM PORT AUTHORITY, REP. BY ITS
CHAIRMAN,PORT AREA, VISAKHAPATNAM, ANDHRA
PRADESH-530035
530035
3. SENIOR TENDER COMMITTEE, REP. BY ITS CHAIRMAN, THE
CHIEF MECHANICAL MANAGER, MECHANICAL AND
ELECTRICAL ENGEERING DEPARTMENT, 2ND FLOOR,
ADMINISTRATIVE OFFICE BUILDING,
VISAKHAPATNAMPORT
AUTHORITY,VISAKHAPATNAM,ANDHRA PRADESH
PRADESH-530035
4. THE CHIEF MECHANICAL ENGINEER, MECHANICAL AND
ELECTRICAL ENGINEERING DEPARTMENT, 2ND FLOOR,
ADMINISTRATIVE OFFICE BUILDING, VISAKHAPATNAM
PORT AUTHORITY, VISAKHAPATNAM, ANDHRA PRADESH
PRADESH-
530035 ...RESPONDENT(S):
2
Petition under Article 226 of the Constitution of India praying that
in the circumstances stated in the affidavit filed therewith, the High
Court may be pleased to issue any writ, order or direction more
particularly one in the nature of Writ of Mandamus declaring the action
of the Respondents in annulling vide the Order No. IM and EE/EQ-3 O
and M/2025- 26-1081 dated 19.02.2026 and the consequential action
of the respondents in issuing a fresh tender notification issued in
Tender NO.60/2025-26/IM and EE/MOF/EQ-3 O and M dated
20.02.2026 including receipt of bids or award of contract as illegal,
arbitrary and violative of Article 14 and 19(1)(g) of the Constitution of
India and consequently direct the respondents to award the contract
bearing tender No.54/2025- 26/IMEE/MOF/EQ-30 and M Dated
22.12.2025 in favour of the petitioner and pass such other order or
orders.
Counsel for the Petitioner:
1. VEMA RAMANJANEYULU
Counsel for the Respondent(S):
1. RAVITEJA PADIRI
The Court made the following:
3
COMMON ORDER:
The respondents issued notification inviting tenders for three procurements. The petitioner has participated in all the three tenders and his tenders were rejected. Challenging the same, these Writ Petitions are filed. As the issue is common in all three Writ Petitions, hence, they are disposed of by this common order.
2. The Writ Petition No.5630 of 2026 is filed under Article 226 of the Constitution of India for the following relief:
"to issue any writ, order or direction more particularly one in the nature of Writ of Mandamus declaring the action of the Respondents in annulling vide the Order No.IM&EE/EQ-3 O&M/2025-26-1081 dated 19.02.2026 and the consequential action of the respondents in issuing a fresh tender notification issued in Tender No.60/2025-26/IM & EE/MOF/EQ-3 O&M dated 20.02.2026 including receipt of bids or award of contract as illegal, arbitrary and violative of Article 14 and 19(i)(g) of the Constitution of India and consequently direct the respondents to award the contract bearing tender No.54/2025-26/IMEE/MOF/ EQ-3O&M Dated 22.12.2025 in favour of the petitioner and pass such other or further orders.....
3. The Writ Petition No.5639 of 2026 is filed under Article 226 of the Constitution of India for the following relief:
"to issue any writ, order or direction more particularly one in the nature of Writ of Mandamus declaring the action of the 4 Respondents in annulling vide the Order No.IM&EE/WQ-1 & WQ-1RE O&M/2025-26-1080 dated 19.02.2026 and the consequential action of the respondents in issuing a fresh tender notification issued in Tender No.58/2025-26/IM & EE/MOF/WQ-1 & WQ-1RE O&M dated 20.02.2026 including receipt of bids or award of contract as illegal, arbitrary and violative of Article 14 and 19(i)(g) of the Constitution of India and consequently direct the respondents to award the contract bearing tender No.55/2025-26/IMEE/MOF/ WQ-1 & WQ-1RE O&M Dated 22.12.2025 in favour of the petitioner and pass such other or further orders.....
4. The Writ Petition No.5646 of 2026 is filed under Article 226 of the Constitution of India for the following relief:
"to issue any writ, order or direction more particularly one in the nature of Writ of Mandamus declaring the action of the Respondents in annulling vide the Order No.IM&EE/EQ-4 O&M /2025-26-1082 dated 19.02.2026 and the consequential action of the respondents in issuing a fresh tender notification issued in Tender No.59/2025-26/IM & EE/MOF/EQ-4 O&M dated 20.02.2026 including receipt of bids or award of contract as illegal, arbitrary and violative of Article 14 and 19(i)(g) of the Constitution of India and consequently direct the respondents to award the contract bearing tender No.52/2025-26/IMEE/MOF/ EQ-4 O&M Dated 22.12.2025 in favour of the petitioner and pass such other or further orders.....
5. The facts of the case in a nutshell for disposal of the Writ Petition are that the 4th respondent issued notification inviting tender vide tender 5 No.54/25-26/IME/MOF/EQ-3O&M dated 22.12.2025, for operation and maintenance of existing EQ-3 terminal for carrying out Clean Cargo handling operation with Harbour Mobile Crane (HMC) and other associated equipment including administration and marketing. The petitioner herein who is a firm represented by the Managing Partner, has participated in the tender and the petitioner stood as lowest (L1) bidder in both technical and financial bid on 16.02.2026.
6. The 4th respondent vide impugned proceedings dated 19.02.2026 informed the petitioner that the competent authority has accorded approval to annul the bidding process as per available provisions of the Notice Inviting Tenders (for short hereinafter called NIT). The tender was cancelled by the Visakhapatnam Port Authority (for short hereinafter called as VPA), outlining that the tender quoted is low or unrealistic invoking clause 44 of the NIT. "As per the clause 44 of the NIT, the VPA reserves right to accept or reject any bid to annul the bid process at any time prior to award the bid without thereby incurring any liability effected bidder or bidders." The annulling bid proceeds through impugned proceedings were challenged in the present Writ Petition on the grounds that the respondents have acted arbitrarily and legitimate expectation cannot be denied without a fair hearing and the impugned notice does not contained any reasons for annulling the tender, once the tender is opened and accepted, once the 6 process of bid declared as lowest bidder, the respondents cannot unilaterally annul the tender notification and cannot issue fresh tender notification, is not legal and the public undertakings are bound by the CVC guidelines issued by the Government of India, Ministry of Finance, Department of Expenditure i.e. Manual for procurement of works and subsequent to the cancellation of tender, the respondents cannot incorporate new rules.
7. Hence, prayed to set aside the impugned notice issued annulling the bid process dated 19.02.2026 and consequently prayed to set aside the fresh notification issued on 20.02.2026 and further prayed to direct the respondents to award the contract bearing tender No.54/25- 26/IMF/MOF/EQ-3 O&M dated 22.02.2026 and in favour of the petitioner.
8. And also relied on the judgment of the Hon'ble Apex Court in Subodh Kumar Singh Rathour v. Chief Executive Officer and others1 for the proposition that:
"the writ petition is maintainable against the State or its instrumentalities in matters arising out of contractual obligation is now held maintainable under Article 226 of the Constitution of India, wherever "public law" element is involved."1
2024 (15) SCC 461 7
9. Heard learned senior counsel Sri O. Manoher Reddy, assisted by learned counsel for the petitioner, and learned designated Senior Counsel Sri P. Raghu Ram assisted by Sri Raviteja Padiri, for the respondents (VPA)
10. Learned senior counsel would submit that under clause 44 of the NIT, the VPA is having the authority to cancel /annul the tender and the petitioner quoted a tender which is unrealistic and also further stated the no malafides are attributed against the respondents in the absence petitioner cannot maintain writ petition under Article 226 of the Constitution of the India and also further stated that the Writ Petition is not maintainable against an administrative order in a contractual matter and there is no concluded contract in between the petitioner and the VPA and the petitioner cannot raise a ground that there is violation of principles of natural justice and the rate quoted by the petitioner is not commercially viable and the price offered by the petitioner i.e. 0.01% of estimate and price is abnormally low. Therefore, when the variation is abnormal, the petitioner has to avail any alternative remedy for damages and the petitioner has not executing the work in charity and the CVC guidelines are applicable when there is ambiguity in NIT Tender conditions and CVC rules does not override any conditions and the VPA has cancelled all the tender uniformly for quoting low prices. The Writ Petition is maintainable only when there is a concluded 8 contract in between the petitioner and the respondents and the Writ Court cannot sit as an appellate authority over the decision of the administrative authority.
11. The learned senior counsel relies on the judgments of the Hon'ble Apex Court: In the case of Principal Chief Conservator of Forest and others v. Suresh Mathew and others2, in the said judgment, the Hon'ble Supreme Court held that the State is protector of financial resources of the State, thus it has every right to cancel and call for fresh tender for protecting financial interests of the State and the petitioner herein has quoted unrealistic tender and also relied on the Judgment in Maa Binda Express Carrier and another vs. North-East Frontier Railway and others3, wherein, the Hon'ble Supreme Court held that submission of a bid/tender in response to a notice inviting tenders is only an offer which State or its agencies are under no obligation to accept bidders participating in the tender process cannot insist that their bids/tenders should be accepted simply because a bid is the highest or lowest. Hence, prayed to dismiss the Writ Petition.
2 2025 SCC OnLine SC 933 3 2014(3) SCC 760 9
12. And also referred on the condition 5.6.4 of the procedure for procurement manual and the same is extracted for the effective disposal of the Writ Petition.
5.6.4 - Consideration of abnormally low bids.
An abnormally low bid is one in which the bid price, in combination with other elements of the bid, appears so low that it is raises material concerns as to the capability of the bidder to perform the contract at the offered price. Procuring entity may in such cases seek written clarification from the bidder including a detail price analysis of his bid price in relation to scope, schedule, resource mobilization, allocation of risk and responsibilities and any other requirements of the bid documents. If after evaluating the price analysis, procuring entity determines that the bidder has substantially failed to demonstrate his capability to deliver the contract at the offered price, the procuring may reject the bid/proposal. However, it would not be advisable to fix the normative percentage below the estimated cost, which would automatically be considered as an abnormally low bid.
13. And in the present case, the Writ Petitioner has quoted a royalty rate of 0.01% which amounts to approximately Rs.0.006 per MT (at Rs.65.05 per MT). The operational maintenance contract is for a period of 15 years. Such a negligible rate raises serious concerns regarding revenue, financial sustainability, operational efficiency, and risk allocation and the VPA being a public authority and custodian of public assets cannot place its assets at such commercial and operational risk 10 merely on the basis of the Petitioner's claim that it has "taken into consideration various factors" while quoting the rate. And the VPA is having power under clause 41 of the NIT document deals with the Evaluation and Comparison of bids. Several factors has to be taken into consideration while awarding the bid, validity to meet the operational who administrative and financial obligations under the tender and the petitioner has not pleaded any malafides against VPA in the absence of the same the petitioner cannot maintain writ petition.
14. The learned designated senior counsel Sri O. Manoher Reddy in repelling the argument, counsel for the respondents would submit that comparing this tender with other tenders is inappropriate and there can be no comparison as the works are fundamentally different with others and does not match. It is further stated the petitioner has quoted tender with all factors taking into account therefore it is not a low and unrealistic bid.
15. Sri O. Manoher Reddy, learned senior counsel appearing for the petitioner would submit that the document does not define the meaning of an "abnormally low bid. In the absence of the same, the respondents invariably has to rely upon the CVC guidelines, and also contended that even according to the Procurement Procedure Manual, the respondents have to seek written clarification from the bidder, including a detailed price analysis with respect to resource mobilization, allocation of risks 11 and responsibilities, and only if the bidder substantially fails to demonstrate its capability to deliver the contract at the offered price, then may reject that the proposal. In the present case, the respondents have not issued any notice seeking written clarification from the bidder. On this ground alone, the impugned order is liable to be set aside. It is further argued that such action of the respondent 'not calling for clarification' challenge on the ground of arbitrary action on the part of the respondents, and not on the ground of malafide.
16. Sri P. Raghu Ram, learned senior counsel, further contended no prejudice whatsoever caused between the petitioner and the respondents, on this account and the tender was cancelled due to the abnormal rate quoted by the petitioner which would not commercial valuable operation and maintenance requirements of the terminal. When the respondents issued a fresh tender for the maintenance of the said work, incorporated certain modifications in the tender conditions, in the fresh notice new clauses have been interdicted, inter alia to reject the multiple awards in the events bidder emerges more than one tender to price situation to fix reserve price, procurement, guaranteed for procurement of abnormality and requirement of additional performance security whatever quoted rejected falls below the reserved price.
17. Having analyzing the arguments made by both the learned counsel for the petitioner and the respondents, this Court cannot go into 12 factual matters, indeed all the averments and arguments addressed by the counsel, are based on the factual contentions.
18. In the judgment relied by Sri O. Manoher Reddy, learned senior counsel in the case of Subodh Kumar Singh Rathour v. Chief Executive Officer and others4, there is a concluded contract in between the appellant therein and the respondents. Therefore, the Hon'ble Apex Court, outlined that the appellant therein has invested significant amount during subsisting of the contract. Therefore, the Hon'ble Supreme Court held that failure on the part of the Courts zealously protect the binding nature of a lawful and valid tender, would erode public faith in contracts and tenders and the involvement of the Ministry in charge concerned and thereby tendering the notice cancellation as illegal, the facts therein the said judgment are not applicable to the present facts of the case as the facts are dissimilar in the case on hand.
19. In the present case, there is no concluded contract in between the petitioner and the respondents. As held by the Hon'ble Apex Court in Maa Binda Express Carrier and another v. North-East Frontier Railway and others5 "inviting tenders is not or its sustenance under no obligation to accept and tenderers cannot insist that 4 2024 (15) SCC 461 5 2014(3) SCC 760 13 their bids/tenders should be accepted simple because the bid is highest or lowest." The Hon'ble Apex Court in Air India Limited v. Cochin International Airport Ltd6 held in para 7 that "even when some defect is found in the decision making process, the Court must exercise its discretionary power under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The Court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the court should intervene."
20. In the case of B.S.N. Joshi & Sons Limited v. Nair Coal Services Ltd and others7 the Hon'ble Apex Court held that "it may be true that a contract need not be given to the lowest tenderer but is equally true that the employer is the best judge therefor; the same ordinarily being within its domain, court's interference in such matter should be minimal. The High Court's jurisdiction in such matters being limited in a case of this nature, the Court should normally exercise judicial restraint unless illegality or 6 2000 (2) SCC 617 7 (2006) 11 SCC 548 14 arbitrariness on the part of the employer is apparent on the face of the record."
21. In the case of Jagdish Mandal v. State of Orissa and others8, the Hon'ble Supreme Court held that interference of the High Court in tender or contractual matters in exercise of power of judicial review, should pose to itself the following questions: (i) whether the process adopted or decision made by the authority is mala fide or intended to favour someone. In the present case, there is no such pleading that the respondents are intended to favour someone.
22. In the case of Rajasthan Housing Board and another v. G.S. Investments and another9, the observation of the Hon'ble Supreme Court in paragraph 9 which reads as follows: "This being the settled legal position, the respondent acquired no right to claim that the auction be concluded in its favour and the High Court clearly erred in entertaining the writ petition and in not only issuing a direction for consideration of the representation but also issuing a further direction to the appellant to issue a demand note of the balance amount.
8 (2007) 14 SCC 517 9 (2007) 1 SCC 477 15
23. As held by the Apex Court, the petitioner has not acquired a right to claim that the auction be concluded in its favour as there is no concluded contract in between the petitioner and the respondent-VPA.
24. In the case of State of Jharkhand & others v. M/s. CWE-SOMA Consortium10 after noticing the decisions of the Hon'ble Apex Court it is stated that it is well settled that so long as the bid has not been accepted, the highest bidder acquired no vested right to have the auction confirmed in his favour.
25. In the case of State of Uttar Pradesh and another v. Al Faheem Meetex Private Limited and another, the Hon'ble Supreme Court held that since, the bid has not been accepted by the competent authority, no right (much less enforceable right) accrued. In such a situation, there was no question of giving any prior notice or opportunity to be given to the said bidder.
26. In the case of Tata Cellular v. Union of India (supra 2), the Hon'ble Supreme Court had launched, scope of judicial review in permitted matters assailing that "It cannot be denied that the principles of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favoritism. However, it must be clearly stated 10 (2016) 14 SCC 172 16 that there are inherent limitations in exercise of that power of judicial review. Government is the guardian of the finances of the State."
27. The respondents herein have rejected the application invoking clause 44 of the NIT document, which reads as follows:
44) VPA's Right to Accept or Reject any or all the Bids:
Visakhapatnam Port Authority reserves the right to accept or reject any bid and to annul the bidding process at any time prior to award of Bidder without thereby incurring any liability to the affected Bidder or Bidders on the grounds of Visakhapatnam Port Authority's action.
28. As seen from the clause 44, the respondents have right to accept or reject any bid and to annul the bidding process at any time prior to award of Bidder without thereby incurring any liability to the affected Bidder or Bidders.
29. On comprehensive reading of all the judgments referred supra, it establishes that a tendering authority as a trustee of public funds is duty bound to ensure transparency, competency and value for making the award of public contracts. Even participation in the tender, declaring lowest bidder does not confer the vested right upon the bidder until formal acceptance / award is made.
17
30. In view of the said judgments of the Hon'ble Supreme Court, as there is no conclude contract in favour of the petitioner herein, mere declaring lowest bidder does not confer vested right upon the bidder, until formal acceptance is made, hence the petitioner cannot maintain the present writ petition. As argued by the respondents, the respondent is the right person to say whether the quotation is low or unrealistic. This Court does not see any merit in the writ petition.
31. Clause 44 entitles respondents for having any right to question on whatever grounds. On the face of the document, the petitioner herein has quoted abnormally low price. Even assuming that a notice calling for explanation is directed, the petitioner cannot make out his case, as the petitioner has quoted a very low bid, which is unrealistic.
32. Hence, in view of the above said discussion, the writ petitions are dismissed. However, no order as to costs.
As a sequel, interlocutory applications, if any, pending in these writ petitions shall stand closed.
__________________________________ JUSTICE TARLADA RAJASEKHAR RAO Date: 08.05.2026 Note: Issue copy by 12.05.2026 b/o Harin 18 25 THE HON'BLE SRI JUSTICE TARLADA RAJASEKHAR RAO W.P.Nos. 5630, 5639 and 5646 of 2026 Date: 08-05-2026 Harin