Orissa High Court
WP(C)/15538/2020 on 18 January, 2021
W.P.(C) No.15538 of 2020
06. 18.01.2021 1. Heard learned counsel for the parties by video conferencing
mode.
2. This writ petition has been filed challenging the auction
Notice dated 26th May, 2020 under Annexure-2 issued by the
Opposite Party No.3 fixing the criteria for the bidders to submit
the Bank Guarantee only and not the solvency certificate in
violation of Rule 27(4) of the Odisha Minor Mineral
Concession Rules, 2016. Petitioner has also challenged Clause-
6 of the Order No.465 dated 2nd January, 2020 under Annexure-
4 issued by the Government of Odisha in Revenue and Disaster
Management Department whereby it has been directed that
none of the Departments shall ask for solvency certificate for
grant of licence for issuing license to storage agents, grant of
renewal of excise licence, quarry lease, etc. Instead, they will
file IT returns, Bank Guarantee etc. for issuing such licences.
3. Mr. K.A. Guru, learned counsel for the Petitioner submits
that the Opposite Party No.3 has issued the auction notice
dated 26th May, 2020 under Annexure-2 for grant of lease of
Sand Sairat (minor minerals) in respect of Batasing,
Panigengutia, Jatia and Kulei Sand Quarries wherein it has been
specifically mentioned that the interested bidders can apply in
Form-'M' of the Odisha Minor Mineral Concession Rules,
2016. However, the authority has directed the intending bidders
for submission of Bank Guarantee and not the solvency
certificate, as per the order under Annexure-4 of the
Government of Odisha, Revenue and Disaster Management
Department, which is in gross violation of the Rule 27 of the
Odisha Minor Mineral Concession Rules, 2016. It is further
submitted by the learned counsel for the Petitioner that the issue
of insisting for solvency certificate, as involved in this writ
petition, is no longer res-integra. This Court in Narayan
Chandra Udgata v. State of Orissa (W.P.(C) No.17069 of
2020, disposed of on 6th October, 2020), has already quashed
Clause-6 of the Order dated 2nd January, 2020 (supra) under
Annexure-4, holding that the authority cannot phase out
solvency certificate by way of a mere executive instruction
superseding the statutory provisions under the Rules. Therefore,
it is prayed that giving the benefit of the said judgment, the
Opposite Party No. 3 may be directed to allow the Petitioner to
participate in the auction by submitting the solvency certificate
without insisting on a Bank Guarantee.
4. Mr. S. Palit, learned Additional Government Advocate
appearing for the State- Opposite Parties contends that if Rules
prescribed for submission of either solvency certificate or Bank
Guarantee, then in that case, if the participant submitted
solvency certificate, he should not be compelled to produce
Bank Guarantee, in view of the clarification issued by the
Government with regard to the same pending finalization of
amendment of Odisha Minor Mineral Concession Rules, 2016.
5. In the matter of the Excise Department, a similar question
had come up for consideration before this Court in Gopinath
Sahu v. State of Orissa & Ors, (W.P.(C) No. 12518 of 2020
and batch of writ petitions disposed of on 3rd August, 2020),
reported in 2020(II) OLR 559, wherein this Court has already
held that the Opposite Party can act upon the solvency
certificate without insisting upon the production of a bank
guarantee.
6. This Court has already considered the question of validity of
Clause-6 of the order dated 2nd January, 2020 under Annexure-
4, issued by the Government of Odisha in Revenue and Disaster
Management, in Narayan Chandra Udgata v. State of Orissa
(W.P.(C) No. 17069 of 2020 disposed of on 6th October, 2020).
Referring to the judgment passed in Gopinath Sahu (supra),
and various other decisions of the Supreme Court, this Court in
Narayan Chandra Udgata (supra) has already quashed the said
Clause-6 of the order under Annexure-4 holding that the
statutory prescription enumerated in the statutory Rules namely;
Rule 27(4) of the Odisha Minor Mineral Concession Rules,
2016 read with Clause-3 of FORM-M and Rule 3 and Rule 4 of
the Odisha Miscellaneous Certificate Rules, 2017 cannot be
overridden by mere executive order issued by the Revenue and
Disaster Management Department dated 2nd January, 2020. In
the said case it was directed that even if the parties do not
submit any Bank Guarantee but submit a solvency certificate,
the assessment can be made on the basis of said document.
7. Since the issue involved in this writ petition is squarely
covered by the aforesaid judgment of this Court in the case of
Narayan Chandra Udgata (supra), this writ petition is also
allowed in terms of the said common judgment. Applying the
same to the present context, the Opposite Parties-authorities are
directed to allow the Petitioner to participate in the auction
process in question on production of the solvency certificate,
subject to fulfillment of other conditions.
8. With the aforesaid observations and direction, the writ
petition stands disposed of.
9. As the restrictions due to the pandemic COVID-19 situation
are continuing, learned counsel for the parties may utilize soft
copy of this order available in the High Court's website or print
out thereof at par with certified copy in the manner prescribed,
vide Court's Notice No.4587, dated 25th March, 2020.
(Dr. S. Muralidhar)
Chief Justice
(S. K. Mishra)
Judge
B. Jhankar
