Madhya Pradesh High Court
Aditya Jain vs Indore Development Authority on 28 October, 2021
Author: Sujoy Paul
1 WP No.18012/2021 & WP No.18476/2021
HIGH COURT OF MADHYA PRADESH, BENCH AT INDORE
Case No. WP No.18012/2021
Parties Name Vatash Sharma
Vs.
Indore Development Authority &
another
Case No. WP No.18476/2021
Parties Name Aditya Jain
Vs.
Indore Development Authority &
another
Date of Order 28/10/2021
Bench Constituted Division Bench:
Justice Sujoy Paul
Justice Pranay Verma
Order passed by Justice Sujoy Paul
Whether approved for Yes
reporting
Name of counsels for Shri A.K.Sethi, learned Sr.counsel
parties with Shri Rahul Sethi, counsel for the
petitioner in WP No.18012/2021.
Shri R.S.Chhabra, learned counsel for
petitioner in WP No.18476/2021.
Shri Pushyamitra Bhargav, learned
counsel and Shri Shrey Raj Saxena,
learned counsel for Indore
Development Authority.
Law laid down 1. Nagar Tatha Gram Nivesh
Adhiniyam, 1973 - Madhya Pradesh
Vikas Pradhikarano Ki Sampatiyon
Ka Prabandhan Tatha Vyayan
Niyam, 2018 - Vyayan Niyam
prescribes the method for disposal of
the property of Development
Authority. The IDA issued NIT for
third and fourth time respectively.
After cancelling the bid of petitioners,
the new NIT was issued based on the
fact that after end of Corona curfew,
the market value of shops is
enormously enhanced. This is not the
2 WP No.18012/2021 & WP No.18476/2021
factor on which a new NIT can be
issued or previous NIT can be annulled
as per the Vyayan Niyam.
2. Interpretation of statutes - If
statute prescribes a thing to be done in
a particular manner, it has to be done
in the same manner and other methods
are forbidden. It is equally settled that
if language of statute is plain and
unambiguous, it should be given effect
to irrespective of its consequences.
3. The judicial review in
contractual/tender matter - The
judicial review is limited to examine
the illegality, irrationality and
procedural impropriety i.e. the
decision making process. On the touch
stone of Wednesbury Principles also
the impugned decision can be tested.
4. The rejection of bid of H-1 -
Rejection is solely based on the
assumption that value of properties
enhanced post Covid period which will
fetch more revenue, which will be in
the interest of IDA. When authorities
are not governed by any statutory
provision like Vyayan Niyam, they
may have a greater discretion to take a
decision in this regard in a judicious
manner but when statutory provision
regulates decision making process, the
authorities have to act strictly in
consonance with the statutory
provisions.
5. The highest bidder - A letter dated
15/3/2021 informing him that he is the
highest bidder and website remark that
bid is "accepted" does not mean that
petitioner's bid was 'approved' by the
competent authority. The Vyayan
Niyam makes it clear that only after
satisfaction of competent authority
3 WP No.18012/2021 & WP No.18476/2021
(Board in this case) the bid can be
treated to be "approved". In absence
there of the aforesaid communications
will not result into "approval" of the
bid.
6. The right of the highest bidder -
Merely because a party is the highest
bidder, no enforceable right is created
in his favour. It is open to the
competent authority to decline said bid
based on justifiable reasons. However,
such bid cannot be rejected arbitrarily
and in a capricious manner.
7. Practice and procedure - The
petitioner filed a writ petition which
was permitted to be withdrawn with
the liberty to file a properly constituted
petition. The averment of previous
petition which was not properly
constituted and permitted to be
withdrawn, have lost significance
when new petition is filed. Apart from
the above, any averment of previous
petition which runs contrary to the
statute (Vyayan Niyam) will not
operate as Estoppel against the
petitioner.
8. Irrelevant consideration/
discrimination - The Vyayan Niyam do
not permit IDA to fix a rate 30% over
and above the reserve price while
issuing third or second NITs. Indeed
Rule 6(vi) permits the IDA to reduce
the reserve price. The respondents
accepted five bids mentioned in the
Chart wherein the bid price was
admittedly below the 30% ceiling
mentioned in the Resolution dated
27/7/2021. Merely because NITs for
those shops were issued prior in time,
those shops cannot be treated to be
belonging to a different class
altogether. There is no reasonable
classification and, therefore,
4 WP No.18012/2021 & WP No.18476/2021
petitioners were subjected to
discrimination in the matter of fixing a
price over and above the reserve price.
Significant paragraph 35-48
numbers
ORDER
(Passed on this 28th day of October, 2021)
Sujoy Paul, J. :
These petitions filed under Article 226 of the Constitution take
exception to the Resolution No.69 dated 27/7/2021 whereby the
petitioner's bid were rejected. The consequential Notice Inviting
Tender (NIT) No.160 dated 10/8/2021 is also called in question
whereby fresh bids for the same shops were invited by respondent
Indore Development Authority (IDA). On the joint request of the
parties the matters were analogously heard and decided by this
common order.
2. Facts are taken from WP No.18012/2021.
3. By issuing NIT No.226 dated 26/9/2019, NIT No.274 dated
14/11/2019 and NIT No.97 dated 27/6/2020 the bids were invited for
the shops situated at RCM 13 which includes shops No.1 and 2 which
are subject matter of present lis and RCM No.14 situated at Scheme
No.140, Anandvan, Phase II, Indore. Since no bids were received by
IDA, a fresh NIT No.220 dated 18/12/2020 (Annexure P/2) was
issued. The petitioner participated in the aforesaid NIT through e-
tendering and submitted his bid for shops No.1 and 2 jointly ad-
measuring 415.92 sq.mtr. The base price fixed by the IDA for the
said shops was Rs.145260 per sq.mtr. The petitioner's bid stood at
Rs.6,28,52,582.64 (six crore twenty eight lakh fifty two thousand five
hundred eighty two and paisa sixty four) which comes to Rs.1,51,117
rupees per sq.mtr which was Rs.5,857 per sq.mtr. higher than the
reserve/base price fixed by the respondents.
4. The respondents opened the bids for the shops in question on
15/2/2021 and petitioner was found to be the highest bidder (H-1).
5. The IDA issued letter dated 15/3/2021 and declared the
petitioner as the highest bidder and it was further informed that
remaining formalities will be communicated to the petitioner. In turn,
the tender status report was uploaded on the official website of the
tenders of Madhya Pradesh showing the name of petitioner in the
awarded bid's list. The technical and financial bids of petitioner were
approved/accepted by the respondents. Heavy reliance is placed on
the document dated 15/3/2021 (Annexure P/7).
6. Shri A.K.Sethi, learned Sr.Counsel by placing reliance on
Clause 6 of NIT submits that entire tender process was required to be
completed within 90 days from the date of opening of the bid. The
acceptance of petitioner's bid is well within the aforesaid time limit.
The petitioner deposited an amount of about Rupees 67 lacs as E.M.D
in furtherance of above NIT dated 18.12.2020
7. The contention of learned Sr.Counsel is that the petitioners
were shocked and surprised to see the fresh NIT dated 10/8/2021
(Annexure P/9) whereby fresh bids were invited for the shops in
question. Upon noticing this NIT, the petitioner enquired about the
reason and came to know about the impugned resolution dated
27/7/2021 (Annexure P/11). By assigning four reasons, the
petitioner's bid was rejected.
8. Criticising the impugned decision dated 27/7/2021, it is
submitted that the petitioner was the highest bidder and his bid was
duly accepted by the respondents which is clear by communication
dated 15/3/2021 (Annexure P/7) and 28/9/2021 (Annexure P/16) filed
with the second rejoinder. This shows that it is a case of concluded
contract and, therefore, the respondents could not have passed the
impugned Resolution rejecting the bids.
9. The Earnest Money Deposit (EMD) of petitioner was not
refunded by the IDA whereas EMD of other bidders was immediately
refunded. In both the replies filed in this case on 17/9/2021 and
24/9/2021 it is averred that amount of EMD of petitioner will be
refunded within 2-3 days but till date said amount has not been
refunded. The said huge amount is still unauthorisedly kept by the
IDA. Since said amount of Rupees about 67 lakhs is not refunded, it
deprived the petitioner to submit his bid as per fresh NIT dated
10/8/2021 (Annexure P/9). This action of respondents is arbitrary,
unreasonable and capricious in nature.
10. The Madhya Pradesh Vikas Pradhikarano Ki Sampatiyon
Ka Prabandhan Tatha Vyayan Niyam, 2018 (hereinafter called as
"Vyayan Niyam") is referred to contend that these statutory rules
govern the aspect of disposal of properties by the IDA. Shri Sethi has
taken pains to contend that Rule 6(v) and (vi) makes it clear that the
bid of applicant stood 'approved' in view of acceptance of the bid.
Apart from this, as per Clause (vi), the new NIT could have been
issued provided the bids so received are less than the reserve price or
(ii) no bid was received at all. Since Vyayan Niyam do not permit the
IDA to issue NIT in the manner it is issued in the instant case, NIT
dated 10/8/2021 is liable to be interfered with.
11. The minutes dated 1/7/2021 are referred to contend that in this
meeting, the properties situated in RCM 13 and 14 (Anandvan Phase
II) were considered. For the reasons best known to the respondents,
no decision was taken about the petitioner's shops in question. For
similarly situated shops/residential accommodations the decision was
taken to accept the bids and issue allotment orders.
12. The petitioner filed a Chart showing the allotment done by the
IDA to the bids slightly higher than the base/reserve price. By
placing reliance on this Chart (Page 91), it is contended that the last
column shows the difference of percentage from base price for said
allotments which was not above 30% of reserve price. Yet the bids
were accepted. The petitioner's bid was declined on the ground that it
is not 30% above the base/reserve price.
13. The criteria of above 30% of base price is a magic percentage
decided by the respondents which is not based on any real or logical
formula. It runs contrary to the statutory rules and could not have
been introduced in the mid of the game. It is argued that neither in
the Vyayan Niyam nor in the NIT it was mentioned that respondents
after inviting the bids can fix a different formula or percentage which
is higher than the base price. This exercise of fixing percentage of
30% above the base price is arbitrary.
14. It is common ground that all the four reasons mentioned in the
impugned Resolution dated 27/7/2021 are bad in law because after
the end of Corona curfew, the market value of all the properties were
enhanced which includes the properties for which decision was taken
on 1/7/2021 and whose description is given in the aforesaid chart.
15. The completion certificate of the shops in question was issued
on 4/3/2021 (Annexure R/1) whereas occupancy certificate was
issued on 18/6/2021 which is reflected in the communication dated
18/6/2021.
16. The second reason assigned in the impugned resolution is
attacked by contending that aforesaid certificates were received much
before taking of impugned decision on 27/7/2021. These certificates
were very much available when decision was taken on 1/7/2021 in
relation to other bids. Nothing prevented the respondents to take
similar decision in relation to shops in question on the said date. The
petitioner's bids were bifurcated in order to deprive them from the
benefit of parity and they were subjected to a calculated
discrimination.
17. The third reason assigned in the impugned resolution is assailed
by contending that this Court by order dated 23/9/2020 in WP
No.21131/2019 (PIL) Santosh Vs. State of MP directed the Municipal
Corporation to construct the road from its own funds in respect of RE
2 road. The compliance report was directed to be submitted before
20/10/2020. Thus, it is clear that the said fact of construction of road
in RE2 is not a subsequent event. Indeed, it was very much known to
the respondents when NIT pursuant to which petitioner's submitted
his bid was issued on 18/12/2020.
18. The fourth reasons mentioned in the impugned resolution is
also assailed by stating that the respondent IDA does not have any
unfettered right to cancel a valid and accepted bid in anticipation of
getting more revenue pursuant to a new NIT. In the impugned
Resolution, the respondents have repeatedly mentioned the NIT dated
30/3/2021 which has no relation with petitioner's bid because
petitioner never submitted their bid pursuant to NIT dated 30/3/2021.
Albeit, they submitted their bid pursuant to NIT dated 18/12/2020.
Thus, on irrelevant considerations and reasons, the bid of petitioner is
rejected.
19. By placing reliance on the second reply dated 24/9/2021 filed
by IDA it is submitted that index contains the date of filing as
24/9/2021 whereas affidavit shows that it was filed on 25/9/2021.
The petitioner repeatedly pleaded in the writ petition and rejoinder
that so called rejection order dated 16/8/2021 was never supplied to
him. It was filed for the first time along with second reply whereas
rejection order is dated 17/8/2021. The learned Sr.Counsel submits
that this rejection order of petitioner's as well as similarly situated
bidders contains same number i.e. 5405 which is not possible. This
rejection order appears to have been prepared lateron and is a forged
document. It is not clear as to by which mode the said document
was sent to the petitioner.
20. The petitioner also raised eye brows on the fresh NIT dated
10/8/2021 by contending that if petitioner's bid was rejected only on
16/8/2021, where was the occasion to issue a fresh NIT prior to it on
10/8/2021.
21. Shri R.S.Chhabra, learned counsel borrowed the argument of
Shri Sethi, learned counsel while arguing WP No.18476/2021. In
addition, he urged that the singular question needs consideration by
this Court is whether impugned resolution dated 27/7/2021 and
consequential NIT dated 10/8/2021 are arbitrary, unreasonable,
irrational and runs contrary to the Vyayan Niyam and public interest.
22. To buttress the aforesaid submission, it is submitted that the
back ground of Covid crisis was equally applicable to all sets of
properties/bids which became subject matter of consideration before
IDA on 1/7/2021 and 27/7/2021. The legal maxim "Nullus
commodum capere potest de injuria sua propria" is referred to
contend that IDA cannot take benefit of its own wrong. He placed
reliance on the following judgments:-
(i) Ram and Shyam Company Vs. State of Haryana & Ors.
(1985) 3 SCC 267.
(ii) Tata Cellular Vs. Union of India (1994) 6 SCC 651.
(iii) Afcons Infrastructure Ltd. Vs. Nagpur Metro Rail
Corporation Ltd. and another (2016) 16 SCC 818.
(iv) Deepak Sharma Vs. Jabalpur Development Authority &
another ILR(2020) MP 377.
(v) G.D. Anklesaria & Co. Vs. M.P. State Industrial
Development Corporation Ltd. passed in WP No.9165/2020.
(vi) Mohammed Sultan Khan Vs. Union of India & Ors.
passed in WP No.17290/2020.
23. Furthermore, the documents Annexure P/16 (cumulatively)
show that shop number 6 & 16 in RCM-13 were allotted on
17/8/2021 and 29/7/2021 respectively. The petitioner's bid was
cancelled thereafter on 17/8/2021. There is no iota of difference
between the cases of petitioner and the persons whose bids were
accepted despite the fact that it was below 30% over and above the
reserved price. The respondents are trying to make an artificial
distinction which is impermissible.
24. Shri Pushyamitra Bhargava, learned counsel assisted by Shri
Shrey Raj Saxena opposed the contentions and by taking this Court
to Rule 6(v) of Vyayan Niyam contended that the relevant bids were
opened as per these rules and statutory format prescribed in the said
rules. The intimation given on the website regarding 'acceptance'
does not mean 'approval' by the competent authority. The bid can be
finalised and contract can be treated to be completed only when
competent authority after his satisfaction approves the highest bid
which situation eventually did not arise because the bids were
cancelled by the impugned Resolution dated 27/7/2021.
25. The respondents contended that the case of petitioners are
different than the cases which were dealt with by Resolution dated
1/7/2021. The NITs (Annexure P/1) were read in juxtaposition to
Resolution dated 1/7/2021 to bolster the submission that the shops
which were considered on 1/7/2021 are relating to NIT (Annexure
P/1) which shows that it relates to 'under construction (fuekZ.kk/khu)
shops' whereas shops related to petitioner of WP No.18476/2021 is
related with NIT dated 30/3/2021 which is related with a 'constructed'
(fufeZr) shop. The 'under construction shops' and 'constructed shops'
are to be dealt with by applying different parameters. No 'under
construction shop' is allotted whose bid was less than 30% formula
as mentioned in Resolution dated 27/7/2021.
26. The issuance of NIT, calling bids and taking decision
thereupon is a commercial and managerial function. The whole
purpose behind cancelling the petitioner's bid was to fetch more
money and revenue and strengthen the public interest. In a matter of
this nature, the IDA is best suited to take a decision. The decision is
neither tainted with mala-fide nor there exists any scope of
arbitrariness or discrimination. The shops of petitioners are
uncomparable with those which became subject matter of
consideration in the Resolution dated 1/7/2021.
27. The petitioner Vatash Sharma earlier filed WP No.15584/2021
which was dismissed as withdrawn with the liberty to file a properly
constituted petition. In the said petition, the petitioner himself prayed
that 30% rate over and above the reserve price may be fixed. Thus,
no fault can be found in the said price fixed by the impugned
Resolution.
28. The Vyayan Niyam are relied upon to contend that the third and
fourth NITs were rightly issued in the light of these rules.
29. To support aforesaid contentions, Shri Bhargava placed reliance
on following judgments:-
(i) U.P. Avas Evam Vikas Parishad & Ors. Vs. Om Prakash
Sharma 2013 AIR SCW 2484.
(ii) Siemens Public Communication Pvt. Ltd. & another Vs.
Union of India & Ors. AIR 2009 SC 1204(1).
(iii) Maa Binda Express Carrier AIR 2014 SC 390.
(iv) Pathan Mohammed Suleman Rehmatkhan Vs. State of
Gujarat & Ors (2014) 4 SCC 156.
(v) Division Bench of this Court in M/s. Narang Cold
Storage Vs. State of MP & two others WP No.7608/2020 dated
10.6.2020.
30. To elaborate, it is urged that technical defects in the process
without any bad intention cannot be a ground for interference. The
division bench judgment in M/s. Narang Cold Storage (supra) was
pressed into service by contending that in view of judgment of
Supreme Court reported in (2019) 10 SCC 738 Municipal Council,
Neemuch Vs. Mahadev Real Estate, the scope of judicial review by
this Court in the decision making process is very limited.
31. In order to meet the argument of Shri Sethi that EMD amount
was never returned, Shri Bhargava placed reliance on para 4 of
additional reply and contended that the said EMD was returned by
speed post on 27/9/2021. The original speed post envelope was
produced before us to show that the petitioner Vatash left the address
given and, therefore, it could not be served. Shri Bhargava fairly
submits that admittedly the EMD was returned after issuance of NIT
dated 10/8/2021. However, IDA has no objection if petitioner after
obtaining the said EMD amount is permitted to participate in the NIT
which is kept in abeyance because of this court's order.
32. In rejoinder submissions, Shri Sethi, learned counsel
emphasised on the pleadings of various returns and urged that there is
no iota of pleadings about sending of EMD amount to the petitioner
on 27/9/2021. In absence of pleadings, the document is of no
assistance. Shri Sethi submits that the NIT dated 18/12/2020 was the
fourth NIT, whereas Shri Chhabra submits that NIT dated 30/3/2021
was the third NIT. It is common ground that the four reasons on
which Resolution dated 27/7/2021 is founded upon are equally
applicable to the properties considered in Resolution dated 1/7/2021.
33. Parties confined their arguments to the extent indicated
above.
34. We have heard the parties at length and perused the record.
35. Before dealing with the rival contedtions, it is apposite to
remind ourself the scope of judicial review in the matters of this
nature. In (1985) 1 AC 374, at 415 (Council for Civil Services
Union v/s Minister of Civil Services), Lord Diplock opined as
under:-
".....one can conveniently classify under three heads
the grounds on which administrative action is subject to
control by judicial review. The first ground I would call
'illegality', the second 'irrationality' and the third
'procedural impropriety'."
36. This opinion of Lord Diplock contains a three-fold
classification on which an administrative decision can be reviewed
by a Court. These are as under:-
(i) 'Illegality' which means that the "decisionmaker
must understand correctly the law that regulates his decision-
making power and must give effect to it". It means that the
decision-maker must keep within the scope of his legal
power. Illegality means that the decision-maker has made an
error of law; it represents infidelity of an official action to a
statutory purpose. Such grounds as excess of jurisdiction,
patent error of law, etc. fall under the head of "illegality".
(ii) 'Irrationality' denotes unreasonableness in the sense
of Wednesbury unreasonableness.
(iii) Procedural Impropriety - The expression includes
failure to observe procedural rules including the rules of
natural justice or fairness wherever these are applicable."
(emphasis supplied)
37. The test laid down by Lord Diplock was quoted with profit
by Supreme Court in Tata Cellular v/s Union of India reported in
(1994) 6 SCC 651.
38. The aforesaid acid test was further considered by the
Supreme Court in catena of judgments. In Tata Cellular (supra)
and in (2015) 15 SCC 137 (Electron Lighting Systems (P) Limited
v/s Shah Investments Financial Developments & Consultants (P)
Ltd.), it was held that in contractual matters, interference is
possible if action impugned is shown to be arbitrary. Similarly, in
Ramana Dayaram Shetty v/s International Airport Authority of
India, (1979) 1 SCC 489, Dutta Associates (P) Ltd. v/s Indo
Merchantiles (P) Ltd., (1997) 1 SCC 53, Heinz India (P) Ltd. v/s
State of U.P., (2012) 5 SCC 443 and Kalinga Mining Corpn. v/s
Union of India, (2013) 5 SCC 252, it was held that if decision
making process is capricious, unreasonable or discriminatory,
interference can be made in contractual matters. In Sterling
Computers Ltd. v/s M & N Publications Ltd., (1993) 1 SCC 44,
Master Marine Services (P) Ltd. v/s Metcalfe & Hodgkinson (P)
Ltd., (2005) 6 SCC 138, Michigan Rubber (India) Ltd. v/s State of
Karnataka, (2012) 8 SCC 216 and State of Jharkhand v/s CWE-
SOMA Consortium, (2016) 14 SCC 172, the Wednesbury Principle is
also applied. The said principles were followed in Caretel Infotech
Ltd. v/s Hindustan Petroleum Corpn. Ltd., (2019) 14 SCC 81 and
Silppi Constructions Contracrtors v/s Union of India & Another,
2019 SCC OnLine SC 1133.
39. In Meerut Development Authority v/s Assn. Of Management
Studies (2009) 6 SCC 171, the question for consideration was
regarding nature of rights of a bidder participating in the tender
process. In no uncertain terms, it was held that disposal of public
property by State or its instrumentality partakes the character of a
Trust. The methods to be adopted for disposal of public property must
be fair and transparent. It was further held that authority has a right
not to accept the highest bid and even to prefer a tender other than the
highest bidder, if there exists good and sufficient reasons. However,
the authority's action in not accepting or refusing the bid must be free
from arbitrariness and favouritism.
40. In view of said parameters laid down for judicial review, the
present matters need to be tested.
41. The stand of Shri A,K. Sethi, learned Senior Counsel for the
petitioner was that the NIT in question dated 18.12.2020 was fourth
NIT whereas Shri Chhabra submits that NIT dated 30.03.2021 was the
third NIT. Shri Pushyamitra Bhargav, learned counsel for IDA did not
dispute the aforesaid contention.
42. Vyayan Niyam deals with the disposal of proper by inviting
bid. The relevant portion reads as under:-
6. Disposal of properties by inviting bid.
The following procedure shall be adopted where the
property has to be disposed through the process of inviting
bids in sealed cover/online-
.....
(v) The offers received through the bids shall be opened in
the manner prescribed in the relevant bid document and the
rates received shall be presented to the Competent Authority
described in rule 28 for decision. The Competent Authority, if
it is satisfied that there was sufficient competition or
sufficient efforts were made to obtain the best bid, may
approve the highest bid if it exceeds the reserve price; even
if single bid is received.
(vi) In case the bids so reserved are less than the reserved
price or in case no bid is received, fresh bids maybe invited
for the second and if necessary for the third time;
(vii) If after the third time the bid continues to be less than
the reserve price or no bid is received, the CEO shall prepare
a report in Form-D and submit it to the Board of the
Authority. The Board of the Authority may reduce the
reserve price upto seventy five percent of the reserve price
fixed in the first three rounds and invite fresh bids. The CEO
shall ensure that a period of at least three months has elapsed
between the first invitation of bids and the invitation at
reduced reserve price;
If the price of the bids received is found to be less than
the revised price or in case no bid is received, then in such
condition new bids can be called for the second and if require
for the third time as well. If the bids called for the third time
are also found to be less than the revised price or no bid is
received then the CEO will upload the information of all such
properties on the website of the related Authority and the
disposal of all such properties shall be done as per the revised
price during the same financial year, on the basis of the offers
received till first Monday of every month of that financial
year. (emphasis supplied)
43. Shri Sethi, learned Senior Counsel for the petitioner contended
that that communication dated 15.03.2021 (Annexure-P/7) and status
of bid shown on the website on 28.09.2021 (Annexure-P/16) as
'accepted' shows that contract was complete, therefore, it could not
have been cancelled and new NIT could not have been issued. We do
not see much merit in this contention. Rule 6(v) of Vyayan Niyam
makes it clear that bids were required to be opened in the prescribed
manner and then required to be placed for consideration before the
competent authority under Rule 28 of the said Rules. Rule 28 shows
that as per amount involved in the present tender, the competent
authority in the instant case was admittedly the 'Board' of IDA. A
conjoint reading of Rule 6 (v) with prescribed form 'C' shows that the
bid is always subject to acceptance by the competent authority. There
is no material to show that there exist any 'acceptance' of bids by the
competent authority/Board. Thus communication dated 15.03.2021
and website remark 'accepted' cannot be equated with 'approval' by
the competent authority. If rule prescribed a thing to be done in a
particular manner, it has to be done in the same manner and other
methods cannot be accepted. [See AIR 1959 SC 93 (Baru Ram vs.
Prasanni), 2001 (4) SCC 9 (Dhananjaya Reddy vs. State of
Karnataka), 2002 (1) SCC 633 (Commissioner of Income Tax,
Mumbai vs. Anjum M.H. Ghaswala) and judgment of this Court in
2011 (2) MPLJ 690 (Satyanjay Tripathi & Anr. vs. Banarsi Devi).
Thus, this contention is devoid of substance.
44. The ancillary question is whether the decision of rejecting the
petitioners' bid is arbitrary, capricious and violates Vyayan Niyam. In
the impugned resolution dated 27.07.2021 following reasons are
assigned for rejecting the bid of the petitioners:-
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¼v½ dksjksuk d¶;Zw dh lekfIr ds i'pkr laifr;ksa dh cktkj njksa esa o`f)
gqbZ gS ,oa i'pkr~okfrZ fufonkvksa esa vf/kd njsa izkIr gqbZ gSA
¼c½ vkuanou Qsl&2 cgqeaftyk Hkou dk dk;Ziw.kZrk ,oa vkD;wisalh izek.k
i= izkIr gks pqdk gS ftlls laifRr ds ewY;ksa esa rsth ls c<+ksrjh gqbZ gSA
¼l½ vkuanou Qsl&2 dh fopkj/khu laifRr;ksa ihiY;kgkuk pkSjkgs ls
ck;ikl dks tksM+us okys eq[; ekxZ ,oa vkj-bZ-&2 ds tD'ku ij fLFkr gSA
pwafd vkj-bZ-&2 ekxZ ds fuekZ.k dh izfØ;k izkjaHk gks jgh gS bl dkj.k ls
vkuanou Qsl&2 laifRr ds ewY;ksa esa rhoz o`f) gqbZ gS
¼n½ mijksDr dkj.kksa ls fopkjk/khu laifRr;ksa esa Hkfo"; esa izkf/kdkjh dks
vf/kd jktLo izkIr gksus dh laHkkouk gSA
izkf/kdkjh ds le{k ;g vfHkys[k Hkh izLrqr fd;s x;s fd izkf/kdkjh }
kjk iwoZ esa Hkh ladYi Øaekd 252 fnukad 29-10-2006 ,oa ladYi Øekad 147
fnukad 22-08-2014 esa U;wure nj ls vf/kd izkIr nj dks fujLr fd;k x;k
FkkA blh izdkj ladYi Øekad 138 fnukad 04-10-2018 esa Hkh U;wure nj ls
vf/kd izkIr nj dks fujLr fd;k tkdj vf/kd nj r; dh xbZ Fkh ftlesa
vf/kd nj ij fufonk izkIr gqbZ Fkh ftlls izkf/kdkjh dks vf/kd jktLo izkIr
gqvk FkkA
vr% mijkDr dkj.kksa ls e.My }kjk ;g fu.kZ; fy;k x;k fd
fufonk foKkiu esa fu/kkZfjr U;wure nj ls 30 izfr'kr vf/kd ls Åij
dh izkIr mPpre fufonk njksa dks Lohd`r fd;k tkrk gS rFkk 'kss"k
vFkkZr~ fu/kkZfjr U;wure nj ls 30 izfr'kr vf/kd ls de izkIr
fufonkvksa dks vLohd`r fd;k tkrk gSA
(emphasis supplied)
45. A bare perusal of the reasons mentioned hereinabove shows that
fundamental reason behind rejecting the bids of petitioners was to
fetch more revenue for the IDA. The said idea of IDA on the first
blush appears to be attractive and permissible in law. However, such
decision needs to be tested on the anvil of Vyayan Niyam and
principles laid down by Apex Court in catena of judgments. On
deeper scrutiny, the said idea lost much of its shine.
46. In cases where there exists no statutory provision for disposal
of properties, the authorities have a great amount of discretion which
can be exercised in a judicious manner. However, when the method of
disposal of property by inviting tender is prescribed by statutory rules
such as Vyayan Niyam, the IDA is bound to invite bids and take
decision thereupon strictly in consonance with those rules. 'Law has
reached its finest moments', stated Douglas, J. in United States v.
Wunderlich [96 L Ed 113: 342 US 98 (1951)] 'when it has freed
man from the unlimited discretion of some ruler.... where
discretion is absolute, man has always suffered.' (quoted with
profit in Natural Resource Allocation, In Re.Special Reference
No.1/2012 (2012) 10 SCC 1). At the cost of repetition, we again
reiterate the legal position that if a statute requires a thing to be done
in a particular manner, it has to be done in the same manner [See para
43]. Similarly it is trite that if language of statute is plain and
unambiguous, it should be given effect to irrespective of its
consequences. [See (1992) 4 SCC 711 Nelson Motis Vs. Union of
India & another & (2020) 9 SCC 161 P. Gopalkrishnan @ Dileep
Vs. State of Kerala & another].
47. Rule 6(vi) and (vii) of Vyayan Niyam leaves no room for any
doubt that impugned NIT dated 10.08.2021 could have been issued
provided the second/third NIT could not fetch a price equal to or
above the 'reserve price' or no bids were received at all. Pertinently,
Clasue (vii) of Rule 6 aforesaid makes it clear that if after third time,
the bid received is less than the reserve price or no bid is received, the
CEO shall prepare a report in a prescribed format and submit it before
the Board for its consideration to reduce the reserve price up to 75%
of the reserve price fixed in the first three rounds and invite fresh bids.
The statutory provision aforesaid permits for going for third or fourth
bid provided conditions mentioned therein are satisfied. The condition
is that either bid submitted is pregnant with value which is less than
the 'reserved price' or no bid is received. This is not the case of IDA
while justifying issuance of fresh NIT dated 10.08.2021. The idea
ingrained in clause (vii) of said Niyam is to 'reduce' the reserve price
while issuing NIT on the fourth occasion.
48. The judgment of Suprme Court in Municipal Council
Neemuch (supra), which was followed by Division Bench in M/s.
Narang Cold Storage (supra) was heavily relied upon by IDA. A
careful reading of this judgment shows that it was poignantly held that
the judicial review of administrative action is permissible where
decision-maker acts contrary to the regulatory decision making power
and where its decision is irrational and suffers from procedural
impropriety. The relevant portion reads as under:-
"11. In the case of Municipal Council, Neemuch v.
Mahadeo Real Estate, (2019) 10 SCC 738, the Apex
Court has examined the scope of power of the High Court
for judicial review of administrative action and
summarized the ground upon which the administrative
action is subject to control by judicial review i.e. (i)
illegality- means the decision-maker must understand
correctly the law that regulates his decision-making
power (ii) irrationality & (iii) procedural impropriety."
(emphasis supplied)
In the other judgments cited by Shri Bhargava, the disposal of
property was not governed by any statutory provision and hence it
was held a simple technical flaw cannot be a ground for interference
wherein in the instant case statutory rules namely Vyayan Niyam
prepared under the M.P. Nagar Tatha Gram Nivesh Adhiniyam, 1973
admittedly govern the field. Thus, the said judgments are
distinguishable. This is trite that a single different fact or a different
governing statutory provision may make a world of difference on the
precedential value of a judgment. [See Haryana Financial
Corporation & another Vs. Jagdamba Oil Mills & another (2002) 3
SCC 496]. Apart from this, we are unable to hold that illegality,
irrationality and procedural impropriety in the impugned action is
only technical in nature.
49. In our view, the impugned Resolution and issuance of NIT falls
within the ambit of "illegality" as defined by Lord Diplock and
followed by Supreme Court in the case of Tata Cellular. We say so
because the impugned Resolution and NIT were issued in utter
disregard to regulatory decision making power mentioned in Rule 6 of
Vyayan Niyam. For the same reason, issuance of impugned
Resolution and NIT amounts to procedural impropriety. It was not
open to the IDA to act in a different manner than the statutory method
prescribed in the Vyayan Niyam. The impugned decision is also
"irrational" and hits Wednesbury Principles. As per Vyayan Niyam,
the third or subsequent NITs can be issued in two eventualities
mentioned in Rule 6(5) and 6 (6) of Vyayan Niyam. The price hike
of properties post Corona period cannot be a relevant consideration
for taking a decision to reject the bid. Had it been a relevant
consideration, the same should have been applied to all the properties
including the properties which became subject matter of consideration
in the Resolution dated 1/7/2021. Since Vyayan Niyam contains the
parameters on which subsequent NITs can be issued, no other factor
can become reason for inviting new NIT. Thus, impugned Resolution
and fresh NIT dated 10/8/2021 are based on irrelevant factors which
cannot be permitted to stand.
50. The Vyayan Niyam do not permit IDA to fix a rate 30% over
and above the reserved price. The respondents by resolution dated
01.07.2021 have admittedly accepted the bids which did not have
value more than 30% than the reserved price. The chart prepared by
the petitioners in this regard is reproduced hereinbelow:-
S.N. Shop No Base Price Super Bid price Date of 25% %
(as per Built Up received E.M.D amount differen
NIT dated Area as (excluding received till ce from
26.09.201 per NIT GST) date base
9 for per price
sq.mtr.)
1. 06/RCM13 1,34,500/- 116.84 1,34,600/- 16.04.21 41,28,250/- 1.007%
sq.mtr
2. 16/RCM13 1,29,120/- 118.62 1,33,800/- 07.04.21 41,67,417/- 1.03%
sq.mtr
3. 17/RCM13 1,29,120/- 148.73 1,33,833/- 07.04.21 52,25,063/- 1.03%
sq.mtr
4. 15/RCM14 1,07,600/- 143.27 1,07,786/- 06.06.20 40,53,657/- 0.93%
sq.mtr
5. 25/RCM14 1,07,600/- 18.20 1,07,750/- 19.06.20 5,14,780/- 1.001%
sq.mtr
51. The contents of chart were not disputed by the IDA. We are not
satisfied with the artificial distinction shown by Shri Bhargav
between the shops for which petitioners submitted their bid and those
mentioned in the aforesaid chart. Thus, we are constrained to hold
that the petitioners were given a discriminatory treatment based on
irrelevant reasons which cannot sustain judicial scrutiny.
52. So far argument relating to pleadings in the previous petition is
concerned, wherein 30% price over and above the reserve price was
pleaded, suffice it to say that previous petition was not treated to be
properly constituted by the petitioner and, therefore, the same was
permitted to be withdrawn with the liberty to file afresh. Thus, said
pleadings which were part of an improperly constituted petition
which was permitted to be withdrawn, pale into insignificance. Even
otherwise, any such pleading which runs contrary to the statutory
provision ingrained in Rule 6 of Vyayan Niyam cannot bind the
petitioner. Putting it differently, none can claim 'estoppel' against a
statutory provision. Thus, this argument of Shri Bhargava cannot cut
any ice.
53. In view of foregoing analysis, in our considered opinion, the
respondents have arbitrarily and contrary to Vyayan Niyam passed
the Resolution dated 27.07.2021 cancelling petitioners' bids and
committed further error in issuing the NIT no.160 dated 10.08.2021.
54. Resultantly, Resolution no.69 dated 27.07.2021 and NIT
No.160 dated 10.08.2021 are set aside. The respondents are directed
to consider the bids of the petitioner and take a decision on the bids
in accordance with law expeditiously preferably within three weeks
from the date of communication of this order.
55. The petitions are allowed to the extent indicated above.
(SUJOY PAUL) (PRANAY VERMA)
JUDGE JUDGE
vm
Digitally signed by
VARGHESE MATHEW
Date: 2021.10.28
13:42:19 -07'00'
