The Orissa High Court held that the 2018 Guidelines governing the selection and renewal of contracts for Women Self Help Groups (WSHGs) supplying Take Home Ration (THR) are binding in the absence of statute, and that authorities cannot bypass these by issuing open advertisements for selection. The judgment upholds longstanding legal principles on the enforceability of non-statutory guidelines and limits administrative discretion, offering binding authority for future disputes over governmental contracts in the social welfare sector.
Summary
| Category | Data |
|---|---|
| Case Name | WP(C)/18134/2025 of M/S.NITAI GAURA WOMENS S.H.G, BHADRAK Vs STATE OF ODISHA |
| CNR | ODHC010459072025 |
| Date of Registration | 02-07-2025 |
| Decision Date | 24-10-2025 |
| Disposal Nature | Disposed Off |
| Judgment Author | MR. JUSTICE SASHIKANTA MISHRA |
| Court | Orissa High Court |
| Bench | Single Bench |
| Precedent Value | Binding within jurisdiction of Orissa High Court |
| Overrules / Affirms |
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| Type of Law | Administrative/Constitutional/Contract law in social welfare schemes |
| Questions of Law |
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| Ratio Decidendi | The Court reaffirmed that in the absence of a statutory enactment, administrative guidelines (here, the 2018 Guidelines for THR/Chhatua distribution) constitute a binding, self-contained code for selection and renewal of WSHG contracts. The Collector’s issuance of open advertisement without first reviewing the incumbent’s performance, as mandated by the guidelines, constitutes a clear violation. The doctrine of a “level playing field” or administrative discretion cannot override express guidelines. The Court further clarified the limits of judicial review in contractual matters, holding that the writ jurisdiction is available for violation of such guidelines, even in the context of contracts. |
| Judgments Relied Upon |
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| Logic / Jurisprudence / Authorities Relied Upon by the Court | The Court reasoned that when administrative instructions/guidelines fill a statutory vacuum, they become enforceable if deviation directly affects vested rights or undermines the public purpose of the scheme. The principles of statutory interpretation apply equally to such guidelines, as per Supreme Court precedents. Bypassing specific procedures in favour of general principles (e.g., open advertisement) is impermissible where the guidelines contemplate a specific sequence of renewal/review. |
| Facts as Summarised by the Court | Biswonath WSHG had long supplied THR/Chhatua under an annually renewable contract governed by 2018 Guidelines, which require performance review before renewal or rescission. Without reviewing Biswonath WSHG’s performance, the Collector issued an open advertisement to select SHGs. Test reports and beneficiary feedback for incumbent SHGs were positive. Incumbents challenged the legality of the advertisement; new applicants sought finalisation of the selection process. |
Practical Impact
| Category | Impact |
|---|---|
| Binding On | All subordinate courts and authorities within the jurisdiction of Orissa High Court |
| Persuasive For | Other High Courts; Supreme Court (on enforceability of administrative guidelines) |
| Follows | Tata Motors Ltd. v. BEST (2023) 19 SCC 1; Supreme Court precedents on guidelines’ enforceability |
| Distinguishes | Reliance Energy Ltd. v. MSRDC (2007) 8 SCC 1 – level playing field doctrine does not override explicit guidelines |
What’s New / What Lawyers Should Note
- Affirms that in the absence of a statute, explicit government guidelines for contract renewal or selection are legally binding; authorities cannot circumvent them by invoking general discretion or fairness principles.
- Clarifies that renewal of contracts under government guidelines is not an automatic right, but the process must adhere strictly to the guidelines (e.g., mandatory performance review).
- Level playing field doctrine or administrative discretion cannot override specific procedures laid down in guidelines.
- Lawyers can cite this case as binding authority within Orissa to challenge administrative actions that bypass scheme guidelines in welfare contract matters.
Summary of Legal Reasoning
- The Court addressed whether writ petitions are maintainable in contract-based government schemes, relying on Supreme Court cases (Joshi Technologies, Radha Krishan Industries) but recognizing exceptions for violations of guidelines affecting public schemes.
- Detailed analysis of the 2018 Guidelines revealed a self-contained, binding code for THR contracts: explicit performance review before contract renewal or rescission, and an absence of any provision for open advertisement.
- The Collector’s issuance of an advertisement for open selection, without conducting performance review, directly violated Clauses 7 and 12(ii) of the guidelines.
- Supreme Court authorities (Narendra Kumar Maheshwari, E.S. Patangwala, Nazir Ahmad) confirm that administrative instructions are enforceable where no statute covers the field, and must be followed as written.
- The “level playing field” and transparency principles (Reliance Energy) cannot trump explicit processes mandated by binding guidelines.
- The Court refused relief to applicants dependent on the illegal advertisement and confirmed that contract renewal is not a vested right but must follow the guidelines’ procedure.
Arguments by the Parties
Petitioners (WSHGs challenging the advertisement):
- The 2018 Guidelines lay down explicit procedures for SHG selection and contract renewal; there is no provision for open advertisement.
- Performance review prior to renewal/rescission is mandatory, and positive reports were received for incumbent SHGs.
- Other districts have renewed contracts without open advertisement; the Collector exceeded his jurisdiction.
- Automatic renewal is not claimed, but adherence to guidelines is mandatory.
Petitioners (Applicants seeking finalisation of new selection):
- Participated in the open selection process upon Collector’s advertisement, fulfilling all eligibility criteria.
- The selection process was blocked due to a judicial order; sought court direction to finalise selection.
State / Respondent:
- Renewal of contract is not a matter of right; contracts must be reviewed on performance.
- Several complaints and adverse reports justified decision to seek open competition.
- Although guidelines do not expressly provide for advertisement, ensuring fairness and transparency justified the Collector’s action.
- Open advertisement does not prohibit incumbent SHGs from participating.
Biswonath WSHG (Intervener):
- No legal authority for issuing advertisement; performance certified as satisfactory.
- Other districts renewed contracts without advertisement; no adverse findings against them.
Factual Background
The dispute arose from the government’s engagement of Self Help Groups (SHGs) for the annual supply and distribution of Take Home Ration (THR/Chhatua) in Bhadrak, Odisha under the 2018 Guidelines. Biswonath WSHG held such a contract since 2011, renewed annually. Without conducting the prescribed performance review, the Collector instructed fresh selection through open advertisement, leading to legal challenges from incumbent SHGs and applications by new aspirants under the advertisement. Test reports and beneficiary evidence supported incumbent performance.
Statutory Analysis
- 2018 Guidelines (Government of Odisha, W & C.D. Department):
- Clause 7: Specifies selection criteria — no mention of open advertisement; prioritises graded SHGs with infrastructure.
- Clause 12(ii): Mandates annual performance review prior to renewal or rescission of contract.
- Legal Principle: Where guidelines provide explicit procedures, authorities are bound to follow them exclusively; administrative discretion cannot override.
- Case Law: Cited Supreme Court precedents establish that administrative guidelines are enforceable and deviations are subject to judicial scrutiny when affecting rights or public scheme objectives.
Alert Indicators
- ✔ Precedent Followed – The judgment affirms and applies longstanding Supreme Court principles regarding enforceability of administrative guidelines where no statute governs the field.