Srinagar- Observing that judicial review in tender or auction process was “extremely limited” in view of the exclusive privilege of the Government in sale and manufacture of liquor, the High Court of J&K and Ladakh on Wednesday dismissed a bunch of petitions by H-1 Bidders, challenging cancellation of auction in February this year regarding liquor vends in various parts of Jammu division for 2024-25.
“…it is clear that the scope of judicial review in the tender/auction process is extremely limited. Admittedly, the Court cannot adjudge the soundness of a decision and it must concern itself only with the manner in which the decision was made,” a bench of Justice Wasim Sadiq Nargal said, underling that the government and other public authorities have the freedom of contract.
“In the absence of manifest unreasonableness, patent arbitrariness or clear mala fides, the Court should show due deference to the decision of the public authority,” the court said, adding, “Consequently, the scope of interference by the Court in matters like these is exceptionally minimal.”
The court said it finds force in the argument made by the Advocate General that the special character of the liquor trade vests the UT Administration with the power to grant the exclusive privilege to carry on trade in the manufacture and sale of liquor.
“In view of the exclusive privilege of the Government in sale/manufacture of liquor, the scope of judicial review in administrative decisions concerning the same is extremely limited,” the court said while summarizing its conclusions and findings.
“No vested right is accrued to a bidder simply by virtue of the fact that he/she has been declared as the highest bidder provisionally and subject to fulfillment of certain conditions in a given auction.”
Bearing in mind the nature of the liquor trade, the Court said that it being a constitutional court, should be slow in interfering with the executive decisions taken by the State as they are essentially a matter of economic policy in which the “Government must be afforded a greater latitude and fair play in the joints.”
“The mere existence of a provision for Minimum Guaranteed Revenue or Minimum Reserve Bid Price in the Excise policy 2024- 25, vide SO 85, does not disentitle the Government from cancelling the auction/re-auctioning on germane considerations having a logical nexus with the policy objectives,” the court further said, adding, “The decision to cancel the auction and the subsequent order for reauctioning cannot be termed as arbitrary, discriminatory, or mala fide so as to warrant judicial interference.”
In any event, the Bench said that the Court cannot interfere with an administrative decision, merely on the premise that any other decision would have been fairer, wiser, or more logical especially, when it relates to the Excise policy.
“The cause projected by the petitioners does not subserve an overwhelming public interest, which must be borne in mind to decide whether judicial intervention is called for or not,” the court adding, “The petitioners, being fully aware of the said auction conditions participated in the same without any demur and after having participated in the auction, cannot turn around and challenge or impugn an auction condition unless there is a foundation of manifest arbitrariness or mala fide, which is conspicuously absent in the instant case.”
After examining the original record, the court said the reasoning provided by the Government for cancelling the auction cannot be termed as unreasonable or arbitrary.
“…in so far as the reasoning behind cancellation of the auction based on poor response and less competition of the auction, the same does not seem implausible or mala fide, as suggested by the counsels for the petitioners, more so, when it is a fact on record that the some of the vends under auction did in fact receive a single bid, the court said, adding, “In these circumstances, this Court discerns no arbitrariness or irrationality in the decision of the Government. Therefore, this Court holds that the decision of the respondent Government cannot be faulted with.”
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