'Antithetical To Public Interest': J&K High Court Modifies Interim Order Which Halted Construction Projects Having Implications On National Security
Vacating an interim order that had stalled key construction projects, the Jammu and Kashmir and Ladakh High Court has reiterated that judicial intervention in government contracts should be limited, prioritizing public interest.The projects, including the construction of the IRP Battalion Headquarters in Kishtwar and the Anti-Corruption Bureau Office in Doda, were held up due to a dispute...
Vacating an interim order that had stalled key construction projects, the Jammu and Kashmir and Ladakh High Court has reiterated that judicial intervention in government contracts should be limited, prioritizing public interest.
The projects, including the construction of the IRP Battalion Headquarters in Kishtwar and the Anti-Corruption Bureau Office in Doda, were held up due to a dispute over the petitioner M/s A L Construction's work completion certificates.
In a judgment passed by Justice Wasim Sadiq Nargal, the court emphasized that courts intervene only when absolutely necessary to prevent overwhelming harm to the public good.
Vacating the interim directions Justice Nargal recorded,
“Although, the role of the court is minimal in contractual matters, unless there is a strong foundation of arbitrariness, mala fides or bias or irrationality…In absence of any such foundation, the court cannot perpetuate further damage in the instant petition by extending the interim direction, which is against the public interest”.
Background of the Case:
M/s A L Construction, represented by Advocate Mr. Manik Dutt, filed the petition after their work completion certificates for a previous project were declared null and void by the respondents, leading to delays in payment and hindrances in new contractual opportunities. The interim order dated March 1, 2023, which stayed this nullification, became the focal point of contention.
Mrs. Monika Kohli, Senior Additional Advocate General (AAG) representing respondent No. 4, argued that the interim order severely hampered the progress of crucial infrastructure projects, jeopardizing national security and public interest. She emphasized that the projects, funded by the Ministry of Home Affairs, are essential for state security and public welfare. Citing Supreme Court judgments, Kohli stressed the necessity of minimal judicial intervention in tender processes.
Mr. Manik Dutt, representing the petitioner, contended that the interim order was justified to prevent undue harm to the petitioner's reputation and business opportunities. He argued that the nullification of completion certificates was a tactic to delay the petitioner's due payments.
Observations of the Court:
After meticulously examining the arguments presented by both parties Justice Nargal cited Tata Cellular Vs. Union of India (1994) and Air India Limited vs. Cochin International Airport Ltd. (2000) to establish the principle of judicial restraint. These judgments stressed that courts should not substitute their judgment for the expertise of the government bodies awarding contracts.
Additionally, the court drew upon B.S.N. Joshi & Sons Ltd. vs. Nair Coal Services Ltd. (2006) to highlight that selecting the most economical tender isn't always the sole criterion, and the government has the right to choose based on various factors.
“Thus, the conspectus of the aforesaid pronouncements would show that the Hon'ble Supreme Court has consistently opined that judicial intervention in the decisions of the public authorities relating to the award of contracts ought to be limited”, the bench remarked.
Commenting on the argument of the petitioner that in spite of the fact that he was declared L1, the respondent No.2, by virtue of the impugned communication had declared the work completion certificates issued to the petitioner as null and void the court said,
“I have perused the record minutely and I do not find any allegation of malafide in both the petitions against the respondents and thus, I do not find any reason, at this stage, being a constitutional court, to extend the interim order, which has caused grave prejudice to the respondents in completing the said projects, which are in public interest and are of national importance”.
Emphasising the concept of "overwhelming public interest" as a threshold for judicial intervention Justice Nargal pointed out that the public's safety and security, in this case, far outweighed the concerns raised by the petitioner regarding the certificates.
“..This court is of the opinion that to buttonhole the project is in nobody's interest but is only antithetical to public interest. The passing of interim direction, in favour of the petitioner, has helped no-one, rather has only caused loss to the parties with no corresponding gain to anyone. The interim direction is visiting very harshly to the respondents. The project, in question, relates to larger public interest, more so, when the question of national security is involved”, Justice Nargal said.
In alignment with these observations, the interim order was modified, allowing the government to proceed with the tender process. However, the court clarified that the final decision regarding the contract would be subject to the outcome of the ongoing writ petition.
Case Title: M/s A L Construction Vs UT of J&K
Citation: 2024 LiveLaw (JKL) 116