Case analysis of Kanhaiya Lal Aggarwal v. Union of India (AIR 2002 SC 2766)

Kanhaiya Lal Aggarwal v. Union of India, AIR 2002 SC 2766

                              

INTRODUCTION

Kanhaiya Lal Aggarwal v. Union of India highlights the scope of judicial review of administrative acts and the liberty of States to act on civil contracts and also explains the concept of liability arising therefrom.

 Honourable Justice S. Rajendra Babu and Honourable Justice P. Venkatarama Reddi.

1. ARTICLES 12,14, 32, 226, AND 298 OF THE INDIAN CONSTITUTION PROVISION APPLIED IN THIS CASE

The main concepts involved in Kanhaiya Lal Agrawal v. UOI

1. The liability of the state arising out of contracts.
2. Freedom of government in exercising its administrative functions relating to tenders and commercial contracts.
3. The scope of judicial review of administrative action in tenders and commercial contracts.

FACTS OF  THE CASE

 

Respondent 1 submitted a proposal to procure, deliver and stack 3 meters of machine-milled truck ballast (75,000) at the Nowruzabad warehouse and load them on freight trains within 24 months. The following conditions are mentioned in the contract:

Both numbers and words should describe the speed at which the task is performed.

In case of violation of the provisions of the contract, it will be canceled at that stage.

Proposals must be open for 90 days from the date of publication of the proposal.

Kanhaiya Lal, a petitioner, received five offers and offered discounts of 5%, 3%, and 2% for periods of 45, 60, and 75 days respectively if the offers were accepted. However, the extended rate is 1.25% and 1% if the offer is accepted within 30 days and 45 days.

The appellant's offer was accepted and the defendant argued that No. 5 had offered the Madhya Pradesh High Court a lower rate than the appellant and therefore his offer should have been accepted.

JUDGEMENT

The court held that if the government entered into a contract, the court would not be willing to enforce it unless the contract was found to be unreasonable, arbitrary, or malicious. SC has given the case of GJ Fernandez v. Karnataka and if the conditions are not met and the person who invited the offer reserves the full right to terminate it only then.

The appellant made an offer with respondent No. 5 who is a reputable trader but was not aware of the business practice of giving discounts as the discount offered by the appellant was part of the offer. Consequently, the Railway Authority held that: SC dismissed the writ petition as there was no objection to accepting the appeal.

 

CONCLUSION

It has been concluded that the government is free to enter into contracts with any person, whether individuals or organizations, but when contracts are entered into with illegal intent, the court intervenes and examines them judicially, and has the authority to Use your powers. Therefore, states cannot act arbitrarily to exclude another person.