Courts Must Be Slow To Grant Interim Relief In Tender Matters: Supreme Court
The Supreme Court recently set aside an interim order passed by the Karnataka High Court directing revision of ethanol allocation in favour of VINP Distilleries and Sugars Pvt. Ltd. under a government tender for the Ethanol Supply Year (ESY) 2025–26, observing that courts should exercise caution while granting interim relief in contractual and tender matters.
“In matters relating to contracts/tenders writ courts should remain circumspect and slow in passing interim orders which may have the effect of seriously impeding the execution of the tender etc. In other words, the High Court should be extremely careful in exercise of its discretion while granting interim relief in the matters of the present nature,” the court observed.
A bench of Justices J.B. Pardiwala and K.V. Viswanathan said, “In such circumstances referred to above, we have reached the conclusion that we should set aside the impugned order and request the High Court to expeditiously take up Writ Petition No. 109133/2025 preferred by the respondent no. 2 for hearing.”
The dispute arose from an expression of Interest issued by oil marketing companies inviting bids for setting up dedicated ethanol plants for supply of ethanol. VINP Distilleries applied pursuant to the EOI on September 17, 2021 and later entered into a Long-Term Offtake Agreement (LTOA) on January 13, 2022 for annual offtake of 1.44 crore litres of ethanol, with a provision for additional preferential allocation up to the plant's designed capacity.
On September 23, 2025, oil marketing companies issued a tender inviting bids for supply of approximately 1,050 crore litres of denatured anhydrous ethanol for ESY 2025–26.
VINP Distilleries approached the Karnataka High Court contending that although it had bid for 9.26 crore litres, it was allotted only 39,269 KL (3.92 crore litres), allegedly in violation of the preferential allocation clause in the LTOA.
A single judge of the High Court on December 15, 2025 granted interim relief directing revision of the allocation in line with the LTOA. The order was subsequently affirmed by a division bench on January 29, 2026.
Allowing the appeals, the Supreme Court noted that the tender allocations had already been completed on October 17, 2025 and definitive supply agreements had been executed on October 27, 2025. Interference at that stage, the bench observed, could disrupt the ongoing ethanol procurement process.
The court accordingly set aside the High Court's interim order and requested the High Court to decide the pending writ petition expeditiously on its merits.
For Petitioners: Dua Associates, AOR; Attorney General for India R. Venkataramani; Advocate Amit Dhingra; Advocate Rohit Mahajan; Advocate Siddharth Agrawal; Advocate Kartikey Aggarwal; Senior Advocate Sajan Poovayya; Advocate Debmalya Banerjee; Advocate Arjun Sharma; Advocate Pranav Garg; Advocate Simran Kaur; Advocate Raksha Aggarwal; Advocate Harshvardhan; DSK Legal, AOR; Senior Advocate Balbir Singh; Advocate Dinesh Pardasani; Advocate Siddharth Chechani; Advocate Parth Tiwari; Advocate Naman Tandan; Advocate Chandra Prakash.
For Respondents: Senior Advocate Abhishek Manu Singhvi; Senior Advocate Gopal Subramanium; Advocate Ajay Kadkol; Advocate Prarit Sharma; Advocate L. Nidhiram Sharma; Advocate Anubhav Kumar; Advocate Jayavardhan Singh; Advocate Ankit Malhotra; Advocate Archi Aggarwal; Advocate Anirudh Alex Victor; Advocate Gauri Subramanium; Agam Sharma, AOR; Advocate Ajay Kadkol; Agam Sharma, AOR; Advocate Shashankk Padiyar; Advocate Sharan K.