In Brief
The Supreme Court upheld the High Court's decision quashing CIDCO's cancellation of a tender allotment to Metropolis Hotels for a hotel plot near Navi Mumbai Airport. Although the partnership firm had applied for but not yet received registration when bidding, it had disclosed this to CIDCO, whose legal team approved the bid. After allotment, CIDCO itself permitted change of land use and plot subdivision. When a new CIDCO administration sought to cancel over a decade later, citing breach of tender conditions, the Court found this violated natural justice (no pre-decisional hearing), contradicted CIDCO's own prior permissions, and was unsupported by evidence of actual loss. The Court held that Government authorities cannot arbitrarily rescind contracts after the successful bidder has invested substantial sums in reliance on their permissions.
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