Madras High Court Rejects PIL Against Tamil Nadu Gold Ring Tender

The Madras High Court on Thursday dismissed a public interest litigation petition that had challenged the Tamil Nadu government's decision to award a contract for supplying one-gram gold rings to Joyalukkas and Kalyan Jewellers.

The rings, numbering 4,41,667, are meant for babies born in government hospitals under the 'Thaimaman Thanga Mothiram Thittam' (Maternal Uncle Gold Ring Scheme).

A Bench of Chief Justice Sushrut Arvind Dharmadhikari and Justice G. Arul Murugan declined to entertain the petition, filed by Chennai-based goldsmith G. Raj, and said a detailed order setting out the reasons for the dismissal would be passed during the course of the day.

During the hearing, the judges observed that the State would only stand to gain if the two jewellers had agreed to supply the rings at a low cost. They said the pricing was purely a business decision taken by the individual firms, depending on the gold stocks they held and their willingness to trim profit margins.

The Chief Justice also questioned how the petitioner, a goldsmith who had not taken part in the tender process, had chosen to file a PIL against the award, and asked how public interest would be affected if the contract went to jewellers who had quoted the lowest cost among all bidders.

The petitioner had argued that the rate accepted from the two firms was abnormally low and commercially unviable. In his affidavit, he said that while the government had agreed to pay the market price for the gold, other costs — making charges, tamper-proof packing, printing of serialised blister cards, transportation and insurance during transit — also had to be borne. Joyalukkas, he said, had quoted a negligible 0.01 paisa for all these charges put together, while the other ten bidders had quoted between ₹410.97 and ₹15,356.27.

After bids were submitted, Kalyan Jewellers, which had originally quoted ₹978.50, agreed to match the 0.01 paisa price, and the contract was awarded to both firms in a 70:30 ratio, the petitioner stated. He claimed the two bidders would earn only about ₹4,416.67 each, an amount he said would not even cover the mandatory hallmarking of the rings, which costs roughly ₹45 per ring and would work out to nearly ₹2 crore for 4,41,667 rings.

Advocate General Vijay Narayan countered that the petitioner's argument on the expertise of the Tamil Nadu Medical Services Corporation Limited, which had called for the tender, conflicted with his own prayer. The petitioner had questioned the corporation's competence to assess gold quality while also seeking a direction to the same body to issue a fresh tender, the A-G pointed out. The petition had sought both the quashing of the contract awarded to the two jewellers and a consequential direction to the corporation to float a new tender.