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Judgment
In all these writ petitions the petitioners are challenging the order of 1the District Collector, Pudukottai, rejecting their tenders. Since the issue
involved is common and an identical order has been passed by the respondent, the same may be disposed of by the following common order.
A Notification was published in Pudukottai District Gazette (Gazette No.4) on 1.3.95 calling for tender applications for the lease of stone quarry
measuring 2.2.95. Hectares in S.No.65 of Kalkudi Village, 1.74.09 hectares in S.No.18 of Vittamapatti Village, 0.68.5. Hectares in S.No.74 of
Boothakudi Village, 1.35.0. Hectares in S.No.149/2 of Veerapatti Village, 0.31.5 hectares in S.No.2/11 of Panangudi Village and 0.50.0.
Hectares in S.No.251 of Kunnanthur Village Pudukottai District for a period of 5 years from 1995-96 to 1999-2000 in respect of stone quarries
and for 3 years from 1995-96 to 1997-98 in respect of gravel and pebble quarries. The last date for receipt of tender applications was fixed on
22.3.95 and the opening of tender was fixed on 23.3.95. In pursuance of the above notification all the petitioners submitted their tenders.
According to them, their offer in the tender was the highest and above the upset price fixed by the respondent. When such is the position, the
respondent after long delay without assigning any reason, by order dated 31.7.95 rejected their tenders and ordered re-auction. Aggrieved against
the said order of rejection, all the petitioners have approached this Court to quash the said order of rejection and also direct the respondent to
confirm the petitioners'' offers made in their tender applications in respect of the quarry mentioned therein.
The respondent has filed a common counter affidavit disputing all the averments made by the petitioners. It is contended that even though the
offer made by the petitioners are above the upset price, since the amount quoted by them are not reasonable, in the circumstances of the case and
in the interest of mineral development, the respondent rejected all the tender applications. Since the respondent has to consider as many as 80
applications, there is some delay in considering the petitioners'' tenders. It is also contended that if the amount offered is not reasonable, the mineral
has to be preserved in order to get more amount next time. Therefore, the reasons stated for the rejection of the petitioner''s applications are not
against law and the orders were passed under the powers vested with the respondent under Rule 8(6)(a) and 8(6)(b) of the Tamil Nadu Minor
Mineral Concession Rules, 1959.
In the light of the above pleadings, I have heard Mr. V. Sanjeevi, learned counsel for the petitioner in all the writ petitions arid Mr. K.
Balasubramaniam, learned Additional Government Pleader for respondent in all the cases.
Mr. V. Sanjeevi, learned counsel for the petitioners raised the following submissions:-
(i) The order of rejection is not in accordance with law, it amounts to arbitrary, exercise of power.
(ii) The respondent has not assigned any reason.
(iii) The order has been passed without application of mind.
(iv) There is unreasonable delay in passing the order.
(v) Inasmuch as the respondent has used cyclostyled stereotype order, that itself shows that he has not considered the claim of the petitioners in
accordance with the Rules.
On the other hand, learned Additional Government Pleader after taking me through the rule 8(6)(a) and (b) of the said Rules, submitted that
after considering the offer made by the petitioners and in the light of the upset price, since the amount offered is low, the respondent has rightly
rejected all their applications. He also submitted that the respondent has given sufficient reason for rejection. He further submitted that in view of
the fact that the respondent has to consider nearly 80 applications, due to administrative reasons, there is a delay of nearly 3 months for
considering the applications of the petitioners. Finally he submitted that merely because the order is in the cyclostyled form, that does not mean that
the respondent has not applied his mind, nor considered the case of the petitioners.
I have carefully considered the rival submissions.
In order to appreciate the contentions of the learned counsel for the petitioner, since the respondent has passed identical impugned orders in all
the writ petitions, I am herewith extracting the impugned order in W.P.No.13130 of 1995. There is no dispute that the offer of the petitioners are
above the upset price fixed by the respondent. I am herewith furnishing the details regarding number of writ petitions, name of the petitioner,
number of applications received, upset price fixed by the respondent and the price offered in the tender by the petitioners:-
SI. W.P. No. Name of the No. of applications Upset price fixed by the Price offered in the lender by
No. Petitioner received Collector thepetitioner
12311/95 S.Palanisamy One 60,000 61,500
12212/95 A. Sianislans One 48,000 50,000
John
12213/95 K. Vetrivel Three 12,000 12,800
I313095 N.Samikannu Two 7,500 10,000
13379/95 C Chellaiah 10,000 10,600
13380/95 K. Subbiah 30,000 33,000
The last referred above shows that the petitioners have quoted their offers just in excess of the upset price fixed by the Collector. It is the vehement
contention of the learned counsel for the petitioner that since the offers of the petitioners are above that upset price, the respondent necessarily has
to accept the tenders. I have already mentioned that all the petitioners have merely quoted Rs.600 to Rs.2800 over and above the upset price
fixed by the Collector. It is settled law that upset price is only a minimum price and it cannot be termed as maximum price. As per rule 8(6)(a) and
8(6)(b) of the Tamil Nadu Minor Mineral concession Rules, 1959 (hereinafter referred to as ""the Rules"") the respondent has to take all endeavours
to get higher revenue and at the same time the acceptance of the tender must be in the interests of mineral development, Rule 8(6) and (b) reads as
follows:-
Rule 8(6)(a). Where only one tender application is received for an area, the District Collector may grant the lease in favour of the single applicant
if in his opinion the annual tender amount offered by the applicant is reasonable in the circumstances of the case and the grant of the lease to the
applicant will be in the interests of mineral development. If the District Collector is not satisfied in the above aspects, he may reject the application
communicating the reasons therefore in writing to the applicant and issue fresh notification in the District Gazette calling for tender application for
the area concerned.
(b) Where two or more tender applications are received for an area, the District Collector shall, ordinarily, grant the lease in favour of the highest
tenderer or the highest bidder, as the case may be:
Provided that where the collector is satisfied - (i) that the highest tender amount or bid amount fetched for an area is not reasonable in the
circumstances of the case; or
(ii) that it will not be in the interests of mineral development to grant the lease to the highest tenderer or highest bidder, shall pass orders refusing to
grant the lease in favour of such applicant communicating to him the reasons thereof in writing.
As per Rule 8(6)(a), if there is one tender application, the District Collector may grant the lease in favour of the single applicant if in his opinion the
annual tender amount offered by the applicant is reasonable in the circumstances of the case and the grant of the lease to the applicant will be in the
interests of mineral development. Hence, if the District Collector is not satisfied in the above two aspects, he is entitled to reject the application and
communicate the reasons therefore in writing to the applicant Thereafter, it is always open to him to issue fresh notification in the District Gazette
calling for fresh tender applications for the area concerned. Likewise, if two or more tender applications are received for an area, the District
Collector as per Rule 8(6)(b) of the Rules shall, ordinarily, grant the lease in favour of the highest tenderer or the highest bidder. Here also, as per
proviso to sub- rule 6(b) the District Collector has to satisfy with the highest tender amount or bid amount fetched for an area is reasonable.
Likewise, he must also satisfy that the same is in the interests of mineral development. If he is satisfied with both the conditions, it is open to him to
grant lease in favour of the highest tenderer or the highest bidder as the case may be. Here, in our cases, it is true that for some survey numbers,
only one application has been received and in other survey numbers two or three applications have been received. I have already extracted the
amount quoted by the petitioners. Since the amounts offered by the petitioners are just above the upset price, as stated in Rule 8(6)(a) and (b) of
the Rules, the District Collector has come to the conclusion that the offers of the petitioners are not reasonable. He has also mentioned that
considering the interests of the mineral development, the amounts offered by the petitioners are low and accordingly rejected their application. In
such circumstance, I am unable to accept the argument of the learned counsel for the petitioners that rejection of the tender applications amounts to
arbitrary exercise of power. I also reject the contention that the respondent has not assigned any reason. At mis stage the learned counsel for the
petitioners has cited a decision of the Supreme Court in Tata Iron and Steel Co. Ltd. etc. Vs. Union of India and others and Industrial
Development Corporation of Orissa Ltd., to show that the quasi judicial authority while rejecting the applications has to assign reasons for his
conclusion. Absolutely there is no dispute with regard to the above proposition. Inasmuch as the respondent in our case has assigned sufficient
reasons as stated above, the contra argument of the learned counsel for the petitioners in this score cannot be accepted.
Relying on a decision reported in Indian Nut Products and Others Vs. Union of India (UOI) and Others, the teamed counsel for the petitioners
submitted that the impugned order cannot be sustained. He very much relied on the following passage in the said decision which is extracted
hereunder-
It is well-settled that if a statute requires an authority to exercise power, when such authority is satisfied that conditions exist for exercise of that
power, the satisfaction has to be based on the existence of grounds mentioned in the statute. The grounds must be made out on the basis of the
relevant material. If the existence of the conditions required for the exercise of the power is challenged, the courts are entitled to examine whether
those conditions existed when the order was made. A person aggrieved by such action can question the satisfaction by showing that it was wholly
based on irrelevant grounds and hence amounted to no satisfaction at all. In other words, the existence of the circumstances in question is open to
judicial review.
Here also, I am of the view that the principles enunciated by their Lordships in the said judgment have been fully followed by the respondent A
reading of the impugned order coupled with the entire factual position clearly shows that the respondent has passed reasonable and convincing
order.
Relying on the other decision, namely, Choknant International Ltd. v. Board of Trustees of the Port of Madras 1987 W.L.R. 529 D.B the
learned counsel for the petitioner submitted that the rejection of the tender of the petitioner cannot be sustained. He relied on the following passage
in the said judgment.
It is therefore, too late in the day to entertain a proposition that where the Government or a public Authority lakes a decision in the matter of a
grant of contract, which decision may also include a decision not to grant the contract, it can do so arbitrarily.
Even a decision not to give a contract or to reject all tenders must be a fair and just decision informed by reason. Judicial scrutiny of such a
decision in the exercise of writ jurisdiction cannot be shut out merely on the ground that there was power in Government or the Public Authority to
reject all tenders and that in exercise of this power all tenders have been rejected. In our view, the petitioner was entitled to invoke the writ
jurisdiction of this Court to contend that the rejection of his tender is arbitrary. It is another matter whether he succeeds in proving that it is
arbitrary. But it is not open to the Government or the Public Authority, to foreclose an enquiry as to the alleged arbitrariness of the decision.
It is true that in the said decision, the Division Bench has concluded that even a decision not to give a contract or to reject all tenders must be a fair
and just decision informed by reason. I have already mentioned the District Collector has rejected the petitioner''s tender applications. Since the
same has been rejected considering the conditions prescribed in rule 8(6)(a) and (b) of the Rules, I am of the view that the respondent has acted in
accordance with law, particularly rule 8(6)(a) and 8(6)(b) of the Rules and he has also adduced acceptable reasons. Hence, the impugned order
satisfies the dictum laid down in the above decision.
Finally the learned counsel for the petitioner relied on a decision of this Court in Srinivasa Thevar v. Thirugnanasambandhar 1982 TLNJ 168
and submitted that inasmuch as the impugned order is in cyclostyted and stereo type one, it clearly shows that the respondent has not applied his
mind before rejecting their applications. It is true that Sathiadev, J. in the said decision has condemned the quasi judicial authorities using cyclostyle
orders in filling up the particulars. In our case I have already held that the impugned order of the respondent is in accordance with the rules as
mentioned above. I have also demonstrated that the offers made by the petitioners are just above the upset price fixed by the respondent and the
District Collector has the petitioners, then it will not be in the interests of mineral development.
In such circumstance, I do not find any error in using the cyclostyled order. More so here about 80 persons have applied for and the respondent
has to dispose of some of the applications. Hence merely because the respondent has used Cyclostyled order that does not show that he has not
applied his mind. It is relevant to note the decision of Apex Court reported in Shivaji Atmaji Sawant Vs. State of Maharashtra and Others, in this
regard. Here also, their Lordships of the Supreme Court had an occasion to consider identical orders passed against 43 persons and those orders
were in the cyclostyled form. Considering similar objections their Lordships have negatived their contentions. The observation of their Lordships is
in the following manner:-
The second contention"" was that identical orders were passed against forty-three other members of the constabulary and that all these orders,
including the one served upon Sawani, were cyclostyled. Where several cylostyled orders are passed, it would prima facie show non-application
of mind but his is not a universal rule and would depend upon the facts and circumstances of each case. In Union of India and Another Vs.
Tulsiram Patel and Others, cyclostyled orders were served upon several members of the Unit of the Central Industrial Security Force posted at
Bokaro with the names of the individual members filed in. Rejecting a similar contention raised in that case, the Court observed (at page 521)of
SCC (at p.1490 of AIR):
''It was said that the impugned orders did not set out the particular acts done by each of the members of the CIS Force in respect of whom
dismissal order was made, and these were merely cyclostyled orders with the names of individual members of the CIS force filled in. Here was a
case very much like a case u/s 149 of the Indian Penal Code. The acts alleged were not of any particular individual acting by himself. These were
acts of a large group, acting collectively with the common object of coercing those in charge of the administration of the CIS Force and the
Government in order to obtain recognition of their association and to concede their demands. It is not possible in a situation such as this to
particularize the acts of each individual member who participated in the commission of these acts. The participation of each individual may be of
greater or lesser-degree but the acts of each individual contributed to the creation of a situation in which a security force itself became a security
risk.''
As observed by the Apex Court, there in no bar that cyclostyled order should not be passed at any point of time. It is not a universal rule and it
would depend upon the facts and circumstances of each case. In the counter affidavit the respondent explained that they have received 80
applications and to save time and also to minimise the work-load of the clerical staff the orders were communicated using the cyclostyled forms,
which does not mean that the respondent has not applied his mind before passing such order. Hence, I reject the last contention of the learned
counsel for the petitioners.
Apart from the above contentions, the learned counsel for the petitioners submitted that Ali Mohamed, J., in a similar circumstance quashed the
order passed by the District Collector, Kanyakumari in W.P.No.11327 of 1995 and the same has been confirmed by a Bench of this Court in
W.A.No.501 of 96. Citing the above two orders, the learned counsel insisted that the present orders of the respondent have to be set aside. No
doubt, the learned Judge in W.P.No.11327 of 1995 dated 29.1.1996 has quashed the order of the District Collector, Kanyakumari at Nagercoil
dated 8.8.1995. In order to appreciate the contention of the learned counsel for the petitioner, it is useful to refer the impugned order in the said
case. A perusal of the said order shows that the Collector after holding that the amount quoted by the highest tenderer is not reasonable rejected
the same. No further counsel for the petitioner with regard to the upset price fixed in that case. On the other hand, in our case it is clear that the
offers made by the petitioners are just above the upset price. For example, in one case for the upset price of Rs.12,000 the offer in the tender by
the petitioner in W.P.No.12213 of 1995 was Rs.12,800
Likewise, the petitioner in W.P.No.13379 of 1995 has offered tender of Rs.10,600 as against the upset price of Rs.10,000. In another case
namely W.P.No.13380 of 1995 for the upset price of Rs.33,00. In such circumstance, considering the mineral wealth and in order to preserve the
same for the best price, the Collector has come to the conclusion that the amount mentioned in the tender is not reasonable. In our case, the
respondent has also taken into consideration the other factor, namely, the interests of the mineral development. After going through the impugned
order in the case before Ali Mohamed, J., I am of the view that the conclusion of the learned Judge is applicable only to the facts of the said case
and the same cannot be made applicable to the cases before me.
In the light of the above factual position, the conditions in Rule 8(6) and (b) of the Rules have been fully complied with by the respondent
before passing the impugned order. Preservation and better utilisation of existing minerals are also some of the activities of the mineral
development. Minerals are the wealth of the nation. Such wealth cannot be taken away by offering unproportionate price. As per the rules, it is the
responsibility of the respondent to ensure that the mineral is sole for a reasonable amount. If the amount offered is not reasonable, the said mineral
has to be preserved in order to get more amount. Hence offering a lesser price for the large quantity of mineral is construed as an act against the
mineral development. If strict procedures adumbrated in the said Rules are not followed, the Government will suffer heavy revenue loss.
Under these circumstances, I am unable to accept any one of the arguments advanced by the learned counsel for the petitioners and I do not
find any infirmity in the order of the second respondent. Consequently, all the writ petitions fail and are accordingly dismissed. No costs.