Transparency in public contracts and procurement
📌 Transparency in Public Contracts and Procurement
🔷 A. Introduction
Public procurement refers to the process by which government bodies or public sector entities purchase goods, services, or works from private firms. Due to the involvement of public funds, transparency in these processes is crucial to:
Ensure fair competition
Prevent corruption and favoritism
Promote accountability
Guarantee efficient use of public resources
Transparency means the openness and accessibility of procurement information and decision-making to the public and stakeholders.
🔷 B. Importance of Transparency in Public Procurement
Helps build trust in public administration
Prevents fraud and manipulation
Encourages participation by diverse suppliers
Ensures value for money and quality
Compliance with legal and ethical standards
🔷 C. Legal and Constitutional Basis
Right to Information under constitutional or statutory law
Public Procurement Acts and regulations
Anti-corruption laws
Principles of natural justice and due process
International frameworks (e.g., UNCITRAL Model Law)
🔷 D. Landmark Case Laws Explaining Transparency
✅ 1. Union of India v. R.G. Anand (1984) 3 SCC 545
Topic: Transparency and Fairness in Public Contracts
Facts:
A contractor challenged the arbitrary cancellation of a contract without proper reasons or an opportunity to be heard.
Held:
The Supreme Court emphasized that public contracts must be awarded fairly, transparently, and based on clear criteria. Arbitrary actions violate principles of natural justice.
Importance:
Public procurement is subject to judicial review for transparency and fairness.
Contracting authorities must act reasonably and provide explanations.
✅ 2. Tata Cellular v. Union of India (1994) 6 SCC 651
Topic: Transparency in Licensing and Procurement
Facts:
The government granted cellular licenses without public bidding, leading to allegations of favoritism.
Held:
The Court held that transparency requires open competition and clear procedures. Secretive or closed processes are void.
Importance:
Reinforced that procurement/licensing must be competitive, transparent, and based on published criteria.
Transparency is essential to avoid arbitrariness.
✅ 3. Manohar Joshi v. Mumbai Municipal Corporation (1992) 2 SCC 686
Topic: Disclosure of Tender Information
Facts:
A contractor sought access to tender documents and evaluation criteria to ensure fairness.
Held:
The Court ruled that access to procurement information is essential for transparency. Public bodies must disclose relevant details unless confidentiality is justified.
Importance:
Right to information in procurement fosters transparency.
Limits secrecy to protect proprietary info, but overall openness is the default.
✅ 4. State of U.P. v. Raj Narain (1975) 4 SCC 428
Topic: Fairness and Transparency in Public Dealings
Facts:
Although not procurement per se, this case dealt with government transparency and fairness in public dealings.
Held:
The Court held that government actions impacting public rights must be transparent and fair. Public contracts are no exception.
Importance:
Reinforces constitutional values of transparency in public administration.
Procurement follows these broader principles.
✅ 5. Delhi Development Authority v. Skipper Construction Co. (1996) 6 SCC 619
Topic: Transparency in Awarding Public Contracts
Facts:
Dispute over awarding contracts without transparent evaluation.
Held:
The Court observed that transparency requires objective evaluation and public disclosure of evaluation criteria.
Importance:
Evaluative criteria must be known in advance and applied fairly.
Discretion must be exercised in good faith and transparently.
✅ 6. Central Inland Water Transport Corporation Ltd. v. Brojo Nath Ganguly (1986) 3 SCC 156
Topic: Public Contracts and Transparency in Tendering
Facts:
Tendering process challenged due to lack of transparency and deviation from prescribed norms.
Held:
Tendering is the rule and exception is deviation only under exceptional circumstances with clear reasons.
Importance:
Transparency mandates that tender processes be open and follow rules strictly.
Deviations undermine fairness and invite judicial scrutiny.
✅ 7. Sterlite Industries (India) Ltd. v. Union of India (2013) 11 SCC 471
Topic: Public Procurement and Environmental Transparency
Facts:
Transparency in environmental clearances linked to public contracts.
Held:
Procurement processes must also include environmental and social transparency.
Importance:
Transparency extends beyond just bids to wider public interest aspects.
Shows evolving transparency doctrine.
🔷 E. Principles Derived from Case Law
| Principle | Explanation |
|---|---|
| Open Competition | Public contracts must be awarded via open, competitive processes. |
| Disclosure of Information | Tender documents, criteria, and decisions should be accessible. |
| Reasoned Decisions | Contracting authorities must explain their decisions openly. |
| Non-Arbitrariness | Arbitrary or secret decisions are invalid. |
| Right to be Heard | Affected parties must get a fair opportunity to present views. |
| Strict Adherence to Procedures | Tendering rules and norms must be followed to ensure transparency. |
| Balancing Confidentiality | Commercial secrets can be protected but should not undermine transparency. |
🔷 F. Conclusion
Transparency in public contracts and procurement is essential for maintaining integrity, fairness, and public confidence in government dealings. Courts have consistently upheld these values by striking down non-transparent practices and mandating open competition, disclosure, and reasoned decision-making.
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