Unsuccessful Bidders Barred from Challenging Tender Process Absent Illegality or Mala Fides

The High Court of Allahabad, in the case of Avani Paridhi Energy and Communications Pvt. Ltd. v. State of Uttar Pradesh & Others (2025 SCC OnLine All 6518), dated October 6, 2025, held that a bidder who participates in a tender process cannot later challenge the same process after being declared unsuccessful, unless there is clear evidence of gross illegality, arbitrariness, or mala fides.

In this case, the petitioner, Avani Paridhi Energy and Communications Pvt. Ltd., challenged the technical evaluation dated September 15, 2025, and the entire tender process on the ground that it violated the mandate of a Government Order dated May 19, 2023. The petitioner contended that it had submitted its bid under protest through a letter dated August 25, 2025, and was therefore not barred from questioning the process. However, the respondents denied receipt of such a protest letter, and the petitioner failed to produce any proof of its delivery. Consequently, the Court found that the claim of participation under protest was unsubstantiated.

The Court held that the writ jurisdiction under Article 226 of the Constitution of India, 1950, must be exercised with restraint in matters concerning government tenders, which are essentially commercial transactions. The Court stated that judicial interference is warranted only in cases involving arbitrariness, unreasonableness, mala fides, or actions contrary to public interest. It emphasized that a tender participant who willingly accepts the tender conditions cannot later challenge them upon losing, as such conduct would be contrary to established principles of fairness and finality in commercial bidding. The Court also referred to its earlier ruling in Moksh Innovations Inc. v. State of Uttar Pradesh, (2021 SCC OnLine All 206), dated September 25, 2024, affirming that challenges to tender conditions must be made before submission of bids, not after the outcome is known.

This judgment reaffirms that participants in a government tender process, having accepted its terms, are estopped from challenging the same post evaluation, thereby reinforcing the principle of judicial restraint in contractual and commercial matters.