An Interim Order Halted A Coal Tender. The Power Plants Were Waiting.
A single interim order restrained a coal company from finalising its tender. A Division Bench has set it aside, and pointed out that the order gave no reasons.
The Court held there is no justification in stalling the tender, since the industries in the power sector to be supplied would suffer, and that loading of coal for supply to the power sector has been stalled. The company, being ‘State’ under Article 12, had the mandate to process the tender through the GeM Portal, a fact made known by a specific covenant in the tender notice itself. The interim order was set aside.
- Lack of reasons indicates non-application of mind, following Rajeev Singh v. State of Uttar Pradesh.
- The tender notice itself disclosed the GeM route, so bidders knew what they were bidding into.
- Contract interpretation is not for the interim stage — the writ petition will need it, and that is where it belongs.
- The work order may issue, but every step abides the result of the writ petition.
- Court
- High Court at Calcutta
- Bench
- Justice HON'BLE JUSTICE SHAMPA SARKAR, Justice HON'BLE JUSTICE ARJUN RAY MUKHERJEE
- Citation
- MAT No. 1424 of 2026 and connected appeals
- Case
- MAT No. 1424 of 2026 and connected appeals
- Decided
- 7 September 2026
- Outcome
- Appeals allowed; interim order restraining the tender set aside
What the interim order had stopped
The order under appeal restrained the coal company from finalising its tender process.
The effect was that loading of coal for supply to the power sector was stalled, and the industries to whom the coal was to be supplied would suffer.
Why it could not stand
The company, being ‘State’ within Article 12 of the Constitution, had the mandate to process the tender through the GeM Portal, and that fact was made known to the bidders by a specific covenant in the notice inviting tender itself.
The ultimate decision in the writ petition would require interpretation of the contractual terms — an exercise that could not be embarked upon at the interim stage.
In Rajeev Singh v. State of Uttar Pradesh the Supreme Court held that a lack of reasons is indicative of non-application of mind by the court, and that such orders would not meet the standard of a proper judgment or order.
There could be no justification in stalling the tender. Damages, if any, could be pursued in a civil court; what had been stopped here was coal reaching the power sector.
What follows
The interim order restraining the company from finalising the tender process was set aside.
The appellants are at liberty to issue a work order in favour of the eligible bidder in accordance with the tender terms and conditions. It was made clear that all steps taken by them shall abide by the result of the writ petition.
Who argued it
Appearances as recorded in the judgment of the Court.
Frequently asked
Will a court stop a tender at the interim stage?
Rarely. Here the interim order was set aside because contract interpretation belongs to the final hearing and the public supply was being stalled.
Does the bidder lose its case?
No. The writ petition continues, and every step taken abides its result.
Resisting an interim stay of a tender
- Quantify the public consequence of delay; the supply chain, not the bidder's loss, is what moved the Court.
- Point to the covenant in the tender notice that disclosed the process complained of.
- Argue that contractual interpretation belongs to the final hearing, not the interim stage.
- Attack an unreasoned order as such — lack of reasons is an independent ground.
Source. High Court at Calcutta, MAT No. 1424 of 2026 and connected appeals, decided 7 September 2026 by Justice HON'BLE JUSTICE SHAMPA SARKAR, Justice HON'BLE JUSTICE ARJUN RAY MUKHERJEE. This explainer is written from the judgment text as reported.
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