UFLEX LIMITED Vs. STATE OF ORISSA

JUDGEMENT

(1.) BY this Writ Petition, the Petitioner challenges the decision of the Govt. of Orissa in Excise Department rejecting its tender submitted for 'Printing of Excise Adhesive Labels (EALs) and Supply of the same to Govt. of Orissa for affixing on the caps of IMFL and Beer bottles etc. as per specifications and terms and conditions mentioned in the Tender Document'.

(2.) THE Petitioner is a company incorporated under the Companies Act, 1956 and is engaged in manufacturing and supply of Security Holograms (Excise Adhesive Labels - 'EALs' in short) of various specifications with several security features and has a comprehensive in -house manufacturing facility to manufacture holograms with state -of -art technology. According to the Petitioner, it has the necessary infrastructure with requisite machineries and equipments to manufacture such security holograms and has the capability to supply Polyester Based Security Holograms (EALs) as per the specification and requirement of different Government authorities.

(3.) WITH regard to point No. (i), we may refer to the Judgment rendered by the Apex Court in Mahabir Auto Stores v. Indian Oil Corporation AIR 1990 SC 1032, wherein it was held thus:.Every action of the State executive authority must be subject to rule of law and must be informed by reason. So, whatever be the activity of the public authority, in such monopoly or semi -monopoly dealings, it should meet the test of Article 14 of the Constitution. If a Governmental action even in the matters of entering or not entering into contracts, fails to satisfy the test of reasonableness, the same would be unreasonable.. It appears to us that rule of reason and rule against arbitrariness and discrimination, rules of fair play and natural justice are part of the rule of law applicable in situation or action by State instrumentality in dealing with citizens in a situation like the present one. Even though the rights of the citizens are in the nature of contractual rights, the manner, the method and motive of a decision of entering or not entering into a contract, are subject to judicial review on the touchstone of relevance and reasonableness, fair play, natural justice, equality and non -discrimination in the type of the transactions and nature of the dealing as in the present case.