Bikramananda Mohanty v. State of Odisha & Ors.

What happened

The petitioner challenged a communication of 5 August 2026 from the Financial Adviser-cum-Special Secretary, Works Department to the Engineer-in-Chief (Civil-cum-Roads), and a follow-up letter of 19 August 2026 from the Engineer-in-Chief's office to the Chief Construction Engineers. The first letter, noting that many grievance petitions on cartelisation and bid-rigging were being received, asked tender-inviting authorities to ensure fair, transparent and impartial participation in open tenders and, where there is evidence of a cartel, to carry out a data-led cost analysis and to take suitable administrative action such as rejecting the bids or reporting the matter to the Competition Commission of India. The second letter set out instructions on genuine competition, detailed analysis of tenders, avoiding mechanical acceptance, reporting serious cases, fixing responsibility, keeping records, reviewing ongoing tenders and sensitising officers. The petitioner, whose name does not appear in either letter, argued with reference to sections 2(c), 19, 26 and 27 of the Competition Act, 2002 that only the Commission can inquire into a cartel on a reference or suo motu, that the letters usurp its powers, and that their effect on all ongoing tenders was shown by a later letter cancelling his tender.

Questions before the court

• Do internal instructions to tender authorities on preventing cartelisation and reporting it to the Competition Commission usurp the Commission's powers under the Competition Act?

Why the court ruled this way

The Court said that the letters were internal executive instructions between departments and officials, which create no legally enforceable right in a third party, and that the Court should be slow and circumspect in interfering (paragraphs 14–15). They did not override the Competition Act or the Commission's powers: they remind the authorities to guard against cartelisation and, on evidence of a cartel, to analyse costs and reject bids or report to the Commission, which is in conformity with section 26, under which a reference is made to the Commission and, if it forms a prima facie opinion, it directs an investigation by the Director General (paragraphs 16–19). The Act is a self-contained enactment, and once convincing material of cartelisation is found, its procedure will be followed; the challenge rested on the untenable premise that its provisions apply only on a reference or suo motu initiation by the Commission (paragraphs 13 and 20). A challenge by a third party to a letter meant to activate the Act would hinder recourse to it (paragraph 21). The rejection of a bid is an independent exercise within the competence of the tender-inviting authority, subject to settled limits, and a separate cause of action which the Court did not consider (paragraph 23). The Court also said that the petitioner's conduct gave the impression of an effort to get away from the letters with a latent intent to promote cartelisation (paragraph 24).

Controlling point

Internal instructions to tender authorities that promote competition and contemplate reference of evidence of a cartel to the Competition Commission neither usurp its powers under the Competition Act nor affect a bidder who is not named in them.

Order and next steps

The writ petition was dismissed with costs of ₹50,000, to be deposited with the State Legal Services Authority within two weeks, to be kept in an account earmarked for juveniles and used for their betterment.

Practical implications

A bidder cannot ordinarily challenge an internal departmental instruction on tender integrity; a decision to reject or cancel its own bid is a separate cause of action to be challenged on its own grounds. Procurement departments that issue such instructions should make clear that evidence is to be referred to the Competition Commission under section 26.

Limits of this ruling

• The Court did not decide the validity of the rejection or cancellation of the petitioner's tender, which it described as an independent cause of action, nor did it decide whether any cartel existed.