Orissa High Court Strikes Down OMC's Mining Tender Cancellation
The Orissa High Court has delivered a significant ruling, setting aside the decision of the Odisha Mining Corporation (OMC) to cancel a mining tender for the Kodingamali bauxite mine. The court declared the move arbitrary and legally unsustainable, directing the state public sector undertaking to complete the tender process as originally initiated.
Background of the Legal Challenge
The high court's ruling came in response to a writ petition filed by a private bidder who had emerged as the successful candidate in the auction. The case centers on a tender floated by OMC on November 3, 2025, for selecting a mine operator for the Kodingamali bauxite mine, which spans the Koraput and Rayagada districts.
The mining project targets an annual production of 35 lakh metric tonnes over a five-year period, with an option to extend for an additional three years. The petitioner company argued that the bidding process had been fully completed, encompassing technical evaluation, financial bid opening, and final auction procedures.
Completion of Tender Process and Sudden Cancellation
According to the petitioner, the process culminated with the identification of the lowest bidder from among nine bidders who met both technical and financial criteria. However, before a work order could be formally issued, the company discovered that OMC had uploaded a tender cancellation notice dated January 5, 2026, on its official portal.
The petitioner challenged this action, alleging that the decision lacked transparency and was arbitrary in nature. The company maintained that having successfully navigated the entire tender process, it was entitled to receive the work order from OMC.
Judicial Observations and Criticism
In a judgment delivered on March 31, a division bench comprising Chief Justice Harish Tandon and Justice M.S. Raman made several critical observations. The bench noted that "the entire tender process got concluded after the exploration and finalization of the lowest bidding price among the techno commercially qualified bidders."
The judges further stated, "Therefore, after having completed the entire tender process, the petitioner company was entitled to be issued with a work order by the OMC." The bench came down heavily on the corporation, describing the tender cancellation notice as "bald, cryptic and bereft of reason."
The court pointed out that it was "demonstrably manifest that the chairman, OMC has disbelieved the noting of his own officials justifying the eligibility criteria." This highlighted a significant internal contradiction within the corporation's decision-making process.
Rejection of OMC's Justifications
The bench also rejected OMC's argument that re-tendering with removed restrictions on sub-contracting could attract wider participation. The court characterized this reasoning as "unfounded" and noted that any restrictive conditions in the Request for Proposal (RfP) had already been addressed through a corrigendum issued during the pre-bid stage after expert consideration.
In its comprehensive assessment, the bench ruled that "from whatever angle the matter is looked at, this court does not find any legality in the order and justification of the chairman, OMC to override the views/opinions of the technical experts."
Court's Final Ruling and Directions
The judgment concluded that "the decision-making process leading the chairman to cancel the tender in entirety is flawed." Consequently, the court declared that "the tender cancellation notice dated 05.01.2026 cannot be countenanced and hence, the same is quashed and set aside."
The judges issued specific directions to OMC's managing director and chief general manager (mining) to proceed with completing all formalities related to the original Request for Proposal dated November 3, 2025. This judicial intervention ensures that the tender process will now move forward to its logical conclusion, respecting the integrity of the original bidding procedure.
