In Ramana Dayaram Shetty v. iaa (1979), the Supreme Court held that the State in awarding contracts:
- A
Has absolute discretion to award contracts to whoever it chooses
- B
Cannot act arbitrarily - must follow a procedure ensuring equal opportunity and selection based on relevant criteria applied transparently
- C
Must always accept the lowest bid
- D
Must obtain Parliamentary approval for all contracts
View answer and explanation
Correct answer: B. Cannot act arbitrarily - must follow a procedure ensuring equal opportunity and selection based on relevant criteria applied transparently
The passage states: 'the State and its instrumentalities cannot act arbitrarily in awarding contracts - they must follow a procedure that ensures equal opportunity to all eligible candidates, and the selection must be based on relevant criteria applied in a transparent manner.'
Source note: Ashok K. Jain Admin Law / Ramana Dayaram Shetty v. IAA / Article 14