CWP-3545 IN THE HIGH COURT OF PUNJAB AND HARYANA AT 113+245 M/S SHREE BALAJI FUELS AND OTHERS STATE OF PUNJAB AND ANOTHER CORAM: HON'BLE MR. JUSTICE Present: SUVIR SEHGAL 1. this Court orders dated 26.12. contract award dated 15.03. of Automated Punjab, were directing respondents to sign contract contract award 2. 3545-2026 (O & M) IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH M/S SHREE BALAJI FUELS AND OTHERS VERSUS STATE OF PUNJAB AND ANOTHER CORAM: HON'BLE MR. JUSTICE SUVIR SEHGAL HON'BLE MR. JUSTICE DEEPINDER SINGH NALWA Ms. G.K. Mann, Senior Advocate with Mr. Shiv Kumar, Advocate for the petitioners. Mr. Amit Kumar Goyal, Addl. A.G., Punjab. *** SUVIR SEHGAL, J. Petitioners have invoked the extraordinary ourt, inter alia, for issuance a writ of certiorari for orders dated 26.12.2025, Annexures P- contract award dated 15.03.2024, Annexure utomated Testing Stations (ATS), in various clusters in the were cancelled. Petitioners have further sought a writ of directing respondents to sign contract agreement contract award, Annexures P-9 to P-12. Brief facts may be noticed. -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CWP-3545-2026 (O & M) Date of decision:16.07.2026 M/S SHREE BALAJI FUELS AND OTHERS ...PETITIONERS VERSUS STATE OF PUNJAB AND ANOTHER ...RESPONDENTS SUVIR SEHGAL DEEPINDER SINGH NALWA Ms. G.K. Mann, Senior Advocate with Goyal, Addl. A.G., Punjab. Petitioners have invoked the extraordinary writ jurisdiction of a writ of certiorari for quashing impugned -23 to P-26, by which, letters of nnexures P-9 to P12, for establishment , in various clusters in the State of Petitioners have further sought a writ of mandamus agreements in pursuance to letters of 26 jurisdiction of impugned rs of to P12, for establishment tate of mandamus in pursuance to letters of SHEETAL 2026.07.28 09:31 I attest to the accuracy and authenticity of this order/judgment High Court, Chandigarh CWP-3545 3. (DNIT) on Private P model. Petitioners submitted their qualified. They were declared as the lowest letters of contract award, A subject to deposit of Petitioners deposited the requisite bank guarantees within stipulated time frame. 4. argued that performance securities, respondents could not refuse to execute the contract agreements. She has referred to contend that contract became legally binding deposit and satisfaction of other conditions required by the transport department. summarily cancelled flimsy ground 5. argued that the cancellation arose because of the legislative shift in the policy initiated as a result of amendment to Vehicle R assessment of parameters indicate State. He submits that government decided to District-cum 3545-2026 (O & M) Respondent No.2 floated a D on 02.11.2023, Annexure P-1, Partnership (PPP) basis under the Petitioners submitted their bids qualified. They were declared as the lowest of contract award, Annexures P-9 to P subject to deposit of performance guarantee of Petitioners deposited the requisite bank guarantees within stipulated time Ms. G. K. Mann, learned senior counsel for the petitioners argued that once petitioners fulfilled performance securities, respondents could not refuse to execute the contract agreements. She has referred to Clause 1.8 of contend that contract became legally binding deposit and satisfaction of other conditions required by the transport department. It is her contention that a binding contract summarily cancelled vide impugned orders flimsy grounds. Per contra, State counsel has opposed the argued that the cancellation arose because of the legislative shift in the policy initiated as a result of amendment to Rules. By referring to written statement, he urges that assessment of vehicle population, fitness parameters indicated that cluster-based model is no longer suitable for the tate. He submits that government decided to cum-Municipal Corporation wise -2- floated a Detailed Notice Inviting Tender for setting up six ATS on Public basis under the Build, Own, Operate (BOO and were found to be technically qualified. They were declared as the lowest (L-1) financial bidders and 9 to P-12, were issued in their favour, performance guarantee of Rs.25 lakhs per location Petitioners deposited the requisite bank guarantees within stipulated time senior counsel for the petitioners, all prerequisites and deposit performance securities, respondents could not refuse to execute the contract lause 1.8 of Annexure VII to DNIT to contend that contract became legally binding upon submission of security deposit and satisfaction of other conditions required by the transport binding contract could not have been orders, Annexures P-23 to P-26, has opposed the writ petition and argued that the cancellation arose because of the legislative changes and a shift in the policy initiated as a result of amendment to the Central Motor By referring to written statement, he urges that an updated vehicle population, fitness testing demand and accessibility model is no longer suitable for the tate. He submits that government decided to undergo transition to a wise ATS model, under which each ender ublic BOO) and were found to be technically financial bidders and were issued in their favour, location. Petitioners deposited the requisite bank guarantees within stipulated time has prerequisites and deposited performance securities, respondents could not refuse to execute the contract DNIT to upon submission of security deposit and satisfaction of other conditions required by the transport ould not have been on petition and changes and a otor updated testing demand and accessibility model is no longer suitable for the undergo transition to a which each SHEETAL 2026.07.28 09:31 I attest to the accuracy and authenticity of this order/judgment High Court, Chandigarh CWP-3545 District/M also been made by him to a communication from the Ministry of Road Transport been notified on 14 recognition reference to commencement date has been defined to be date of execution of contract between the parties, wherefrom, operation period shall be treated to have commenced. executed between the parties. 6. the documents referred to by them during 7. Clause 1.8 procedural clearly reflects that no formal parties. R the basis of selected for the award of contract between the parties. 8. any bid or cancel/ cancellation, only restriction is that it should be A perusal of that decision to P-12, has been taken on account of change in 3545-2026 (O & M) Municipal Corporation shall have at least one ATS. also been made by him to a communication from the Ministry of Road Transport and Highways, Government of India, whereby amendments have been notified on 14.03.2024, Annexure P tion, regulation and control of ATS. In particular, he has made a reference to Clause 1.1.1(9) of Annexure VII to DNIT to commencement date has been defined to be date of execution of contract the parties, wherefrom, operation period shall be treated to have commenced. It is a specific case that executed between the parties. We have heard counsel for the parties at length and examined the documents referred to by them during Although, it has been strenuously lause 1.8, ibid, made the contract legally binding upon completion of the procedural requirements and submission of the bank guarantees, but record clearly reflects that no formal execution of a contract took place between the Respondents did not issue any work order to petitioners. At best, on the basis of Annexures P-9 to P-12, petitioner selected for the award of contract, without any formal contract agreement between the parties. The settled legal position is that a tenderer can acc any bid or cancel/postpone the tender or withdraw cancellation, only restriction is that it should be perusal of impugned communications that decision to annul the tender and cancel the letters has been taken on account of change in -3- orporation shall have at least one ATS. Reference has also been made by him to a communication from the Ministry of Road and Highways, Government of India, whereby amendments have nnexure P-27, bringing about changes in the control of ATS. In particular, he has made a of Annexure VII to DNIT to submit that commencement date has been defined to be date of execution of contract the parties, wherefrom, operation period shall be treated to have It is a specific case that a contract agreement was never for the parties at length and examined the course of arguments. strenuously argued by petitioners that legally binding upon completion of the and submission of the bank guarantees, but record execution of a contract took place between the espondents did not issue any work order to petitioners. At best, on petitioners can claim to have been without any formal contract agreement legal position is that a tenderer can accept or reject e tender or withdraw from it. In case of a cancellation, only restriction is that it should be done for justifiable reasons. communications, Annexures P-23 to P-26, shows tender and cancel the letters, Annexures P-9 to has been taken on account of change in the policy and reassessment of Reference has also been made by him to a communication from the Ministry of Road and Highways, Government of India, whereby amendments have 27, bringing about changes in the control of ATS. In particular, he has made a submit that commencement date has been defined to be date of execution of contract the parties, wherefrom, operation period shall be treated to have ever for the parties at length and examined that legally binding upon completion of the and submission of the bank guarantees, but record execution of a contract took place between the espondents did not issue any work order to petitioners. At best, on to have been without any formal contract agreement ept or reject n case of a done for justifiable reasons. shows 9 to the policy and reassessment of SHEETAL 2026.07.28 09:31 I attest to the accuracy and authenticity of this order/judgment High Court, Chandigarh CWP-3545 high-priority and operation of ATS requirements in the changed situation and ATS all districts o respondents revised guidelines falls This decision arbitrary. merely on the basis of being declared as L furnished performance security fault of petitioners, equity demands that respondents immediately release and return perf petitioner 9. merit in the costs. 10. and deposits, if any, made 11. disposed of. 16.07.2026 sheetal 3545-2026 (O & M) priority districts. Respondents have taken a decision that distribution and operation of ATS across Punjab clusters would not meet the requirements in the changed situation and ATS all districts or municipal corporations. In view of this change, decision of respondents to cancel the tender process and invite fresh bids in view of the revised guidelines falls squarely within administrative domain of the This decision cannot be actuated by mala Petitioners cannot compel the merely on the basis of being declared as L nished performance security. As tender process has fault of petitioners, equity demands that respondents immediately release and return performance bank guarantees s, without making any deduction. For the reasons recorded above, this merit in the writ petition, which is dismissed It is expected that respondents shall return the bank guarantees and deposits, if any, made by petitioners as expeditiously as possible. Pending miscellaneous application(s), if any, shall stand disposed of. .2026 (DEEPINDER SINGH NALWA Whether Speaking/reasoned Yes/No Whether Reportable Yes/No -4- Respondents have taken a decision that distribution across Punjab clusters would not meet the requirements in the changed situation and ATS stations should be set up municipal corporations. In view of this change, decision of process and invite fresh bids in view of the within administrative domain of the State. mala fides nor can it be termed as Petitioners cannot compel the State to execute a formal contract merely on the basis of being declared as L-1 bidders or upon having tender process has been scrapped for no fault of petitioners, equity demands that respondents immediately release s and amount, if any, deposited by without making any deduction. For the reasons recorded above, this Court does not find any which is dismissed, though with no order as to It is expected that respondents shall return the bank guarantees as expeditiously as possible. Pending miscellaneous application(s), if any, shall stand (SUVIR SEHGAL) JUDGE DEEPINDER SINGH NALWA) JUDGE Yes/No Yes/No Respondents have taken a decision that distribution across Punjab clusters would not meet the uld be set up in municipal corporations. In view of this change, decision of process and invite fresh bids in view of the tate. termed as execute a formal contract 1 bidders or upon having for no fault of petitioners, equity demands that respondents immediately release amount, if any, deposited by ourt does not find any though with no order as to It is expected that respondents shall return the bank guarantees Pending miscellaneous application(s), if any, shall stand ) SHEETAL 2026.07.28 09:31 I attest to the accuracy and authenticity of this order/judgment High Court, Chandigarh