Mere Familial Relationship Between Bidders Does Not Amount To Cartelisation In Tender Process: Bombay High Court

The Bombay High Court has held that a mere familial relationship between bidders does not, by itself, establish cartelisation or collusion in a tender process. The Court observed that allegations of cartelisation must be supported by cogent material showing bid manipulation or lack of independent decision-making.

A division bench of Justices Urmila Joshi-Phalke and Nivedita P. Mehta were hearing a writ petition filed challenging the rejection of its technical bid in an e-tender floated by the Amravati Municipal Corporation for road maintenance works and the acceptance of the bid of respondent No.4. The petitioner, a registered contractor, contended that its bid was wrongly rejected despite fulfilling eligibility conditions and further alleged that respondent Nos.4 and 5, being son and father, had participated as separate bidders using common resources, thereby engaging in cartelisation.

The Court examined the scope of judicial review in tender matters and reiterated that the authority issuing the tender is the best judge of its requirements and interpretation of its conditions. It held that even if multiple interpretations are possible, the interpretation adopted by the tendering authority ought not to be interfered with unless shown to be arbitrary.

“The scope of interference is confined to examining the decision-making process and not the merits of the decision itself. Unless the action of the authority is shown to be arbitrary, mala fide, irrational or in violation of the tender conditions, the Court would ordinarily refrain from interfering. The Court must be conscious not to substitute its own view for that of the expert body and entrusted with evaluation,” the Court observed.

The Court found that the petitioner had been given an opportunity to cure deficiencies and submit requisite documents, but the material placed on record did not establish compliance with the eligibility condition as interpreted by the authority. It held that the evaluation of such documents falls within the domain of the expert committee and no perversity or arbitrariness was demonstrated in its assessment.

With respect to the allegation of cartelisation, the Court held that a mere relationship between bidders is insufficient to infer collusion. It noted that both respondents were independent registered contractors and that there was no material to show bid-rigging, price manipulation, or absence of independent decision-making. It observed:

“Mere relationship between bidders cannot be an inference of collusion. What is required to establish in such a case is that the tendering authority has abused its dominance or that the competent bidder is ousted as a result of anti-competitive practices.”

The Court further held that no violation of principles of natural justice was made out, as the petitioner had been afforded an opportunity to rectify deficiencies.

Accordingly, the High Court dismissed the writ petition and refused to interfere with the tender process.

Case Title: M/s G.H. Khandelwal vs. Amravati Municipal Corporation & Ors. [Writ Petition No. 293 of 2026]

Case Title: 2026 LiveLaw (Bom) 218

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