Rajasthan High Court - Jodhpur

Raj. Housing Board Jaipur And Ors vs Yudhister Gupta (2024:Rj-Jd:8078-Db) on 15 February, 2024

Author: Manindra Mohan Shrivastava

Bench: Manindra Mohan Shrivastava

[2024:RJ-JD:8078-DB]

      HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
                       JODHPUR


                   D.B. Spl. Appl. Writ No. 1322/2013

1. Deputy Commissioner, Circle-II, Rajasthan Housing Board,
Sector-11, Chopasni Housing Board, Jodhpur.
2. Resident Engineer, Circle-I, Rajasthan Housing Board, Sector-
11, Chopasani Housing Board, Jodhpur.
                                                                       ----Appellants
                                       Versus
1. Smt. Santosh Joshi wife of Shri Kailash Joshi, aged about 44
years, resident of 23-C/41, Chopasni Housing Board, Jodhpur
(Writ Petitioner)
2. State of Rajasthan through Secretary Urban Development and
Housing Department, Govt. of Rajasthan, Jaipur.
                                                                    ----Respondents
                                 Connected With
                   D.B. Spl. Appl. Writ No. 1223/2013
1. Rajasthan Housing Board through its Chairman, Jawahar Lal
Nehru Marg, Jaipur (Rajasthan)
2. Deputy Resident Commissioner, Rajasthan Housing Board,
Circle-I, Jodhpur (Rajasthan)
3. Resident Engineer, Rajasthan Housing Board, Division-II,
Sector-4, Kudi Bhagtasni Scheme, Jodhpur (Rajasthan)
                                                                       ----Appellants
                                       Versus
Mahesh Chander Mittal of Shri Budh Ramji Mittal, R/o Housing
No.41,     Third       Block,     Purani       Abadi,        Tehsil    and   District
Sriganganagar.
                                                                      ----Respondent




                   D.B. Spl. Appl. Writ No. 1224/2013
1. Chairman Raj. Housing Board, Janpath Road, Jyoti Nagar,
Jaipur.
2. The Chief Estate manager, Rajasthan Housing Board, Jaipur.
3. Deputy Commissioner, Rajasthan Housing Board, Bikaner
Division, Bikaner.
4. Housing Engineer (sic Resident Engineer), Rajasthan Housing


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Board, Hanumangarh Division, Hanumangar Junction.
                                                                     ----Appellants
                                      Versus
1. Smt. Kamaljeet Kaur W/o Shri Satbir Singh, R/o 4/206, STPS
Colony, Prabhat Nagar, Suratgarh, District Sriganganagar.
2. State of Rajasthan through the Principal Secretary to the
Government Department of UGD, Rajasthan-Jaipur.
                                                                   ----Respondents


                  D.B. Spl. Appl. Writ No. 1228/2013
1. Rajasthan Housing Board, through its Chairman, Jaipur.
2. Financial Advisor Rajasthan Housing Board, Jaipur.
3. Deputy Housing Commissioner, Rajasthan Housing Board,
Udaipur.
4. Resident Engineer, Rajasthan Housing Board, Shivaji Nagar,
Division Dungarpur, Dungarpur.
5. Project Engineer (Senior), Rajasthan Housing Board, House
No. 1-G-14, Shastri Nagar, Banswara.
                                                                     ----Appellants
                                      Versus
Smt. Preeti Gupta of Shri Harish Gupta, R/o Matra Pitra Chhayat,
C-A/5, Mahi Sarovar Nagar, Housing Board, Banswara, District
Banswara.
                                                                   ----Respondent


                  D.B. Spl. Appl. Writ No. 1229/2013
1. Rajasthan Housing Board through its Chairmna, Jaipur.
2. Financial Advisor Rajasthan Housing Board, Jaipur.
3. Deputy Housing Commissioner, Rajasthan Housing Board,
Udaipur.
4. Resident Engineer, Rajasthan Housing Board, Shivaji Nagar,
Division Dungarpur, Dungarpur.
5. Project Engineer (Senior),             Rajasthan Housing Board, House
No. 1-G-14, Shastri Nagar, Banswara.
                                                                     ----Appellants
                                      Versus
Raj Kumar Gupta S/o Shri Nirmal Kumar Gupta R/o 519, Vidyut
Nagar, Banswara, District Banswara.

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                                                                   ----Respondent


                  D.B. Spl. Appl. Writ No. 1296/2013
1. Raj. Housing Board Jaipur through its Chairman, Jaipur.
2. Financial Advisor, Rajasthan Housing Board, Jaipur.
3. Deputy Housing Commissioner,                     Rajasthan Housing Board,
Circle-II, Jodhpur.
4. Residential Engineer,           Rajasthan Housing Board, Section-I,
Jodhpur.
                                                                    ----Appellants
                                      Versus
Babu Singh Tanwar S/o Shri Kan Singh ji, bR/o 21/749,
Chopasani Housing Board, Jodhpur.
                                                                   ----Respondent


                  D.B. Spl. Appl. Writ No. 1297/2013
1. Raj. Housing Board through its Chairman, Jaipur.
2. Financial Advisor, Rajasthan Housing Board, Jaipur.
3. Deputy Housing Commissioner,                     Rajasthan Housing Board,
Circle-II, Jodhpur
4. Residential Engineer,           Rajasthan Housing Board, Section-I,
Jodhpur.
                                                                    ----Appellants
                                      Versus
Sobhagh Singh Chouhan S/o Shri Suraj Singh Chouhan, R/o B-
10, Second Extension, Kamla Nehru Nagar, Jodhpur.
                                                                   ----Respondent


                  D.B. Spl. Appl. Writ No. 1298/2013
1. Raj. Housing Board through its Chairman, Jaipur.
2. Financial Advisor, Rajasthan Housing Board, Jaipur.
3. Deputy Housing Commissioner,                     Rajasthan Housing Board,
Circle-II, Jodhpur
4. Residential Engineer,           Rajasthan Housing Board, Section-I,
Jodhpur.
                                                                    ----Appellants
                                      Versus


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Yudhister Gupta S/o Shri Bajrang Lal, R/o 23/123, Chopasni
Housing Board, Jodhpur.
                                                                   ----Respondent


                  D.B. Spl. Appl. Writ No. 1302/2013
1. Raj. Housing Board through its Chairman, Jaipur.
2. Financial Advisor, Rajasthan Housing Board, Jaipur.
3. Deputy Housing Commissioner,                     Rajasthan Housing Board,
Circle-II, Jodhpur
4. Residential Engineer,           Rajasthan Housing Board, Section-I,
Jodhpur.
                                                                    ----Appellants
                                      Versus
Vijay Kumar S?o Shri Ranu Ramji, R/o 1013-Nehru Park, Railway
Colony, Jodhpur.
                                                                   ----Respondent


                  D.B. Spl. Appl. Writ No. 1303/2013
1. Raj. Housing Board through its Chairman, Jaipur.
2. Financial Advisor, Rajasthan Housing Board, Jaipur.
3. Deputy Housing Commissioner,                     Rajasthan Housing Board,
Circle-II, Jodhpur
4. Residential Engineer,           Rajasthan Housing Board, Section-I,
Jodhpur.
                                                                    ----Appellants
                                      Versus
Kisore Ramchandani S/o late Shri Tek Chandji, R/o 23/29,
Chopasni Housing Board, Jodhpur.
                                                                   ----Respondent


                  D.B. Spl. Appl. Writ No. 1333/2013
1. Raj. Housing Board through its Chairman, Jaipur.
2. Financial Advisor, Rajasthan Housing Board, Jaipur.
3. Deputy Housing Commissioner,                     Rajasthan Housing Board,
Circle-II, Jodhpur
4. Residential Engineer,           Rajasthan Housing Board, Section-I,
Jodhpur.
                                                                     ----Appellant

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                                      Versus
Narendra Kumar S/o Late Shri Chetan Das, R/o 4-SA-5,
Chopasni Housing Board, Jodhpur.
                                                                   ----Respondent


                  D.B. Spl. Appl. Writ No. 1340/2013
1. Raj. Housing Board through its Chairman, Jaipur.
2. Financial Advisor, Rajasthan Housing Board, Jaipur.
3. Deputy Housing Commissioner,                     Rajasthan Housing Board,
Circle-II, Jodhpur
4. Residential Engineer,           Rajasthan Housing Board, Section-I,
Jodhpur.
                                                                     ----Appellant
                                      Versus
Bajrang Lal S/o Shri Fakir Chand, R/o 23/123, Chopasni Housing
Board, Jodhpur.
                                                                   ----Respondent


                  D.B. Spl. Appl. Writ No. 1341/2013
1. Raj. Housing Board through its Chairman, Jaipur.
2. Financial Advisor, Rajasthan Housing Board, Jaipur.
3. Deputy Housing Commissioner,                     Rajasthan Housing Board,
Circle-II, Jodhpur
4. Residential Engineer,           Rajasthan Housing Board, Section-I,
Jodhpur.
                                                                     ----Appellant
                                      Versus
Hari Om Purohit S/o Poonam Chand Purohit, R/o 5-A-43,
Chopasni Housing Board, Jodhpur.
                                                                   ----Respondent


                  D.B. Spl. Appl. Writ No. 1342/2013
1. Raj. Housing Board through its Chairman, Jaipur.
2. Financial Advisor, Rajasthan Housing Board, Jaipur.
3. Deputy Housing Commissioner,                     Rajasthan Housing Board,
Circle-II, Jodhpur
4. Residential Engineer,           Rajasthan Housing Board, Section-I,
Jodhpur.

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                                                                      ----Appellant
                                      Versus
Kapil Jain S/o Sohan Lal Jain, R/o Nayapura, Nahaton Ka bas,
Dhani Bazar, Barmer Presently residing at 893, First Floor,
Khanjanchi Niwas, 2nd D Road Sardarpura, Jodhpur.
                                                                   ----Respondent


                   D.B. Spl. Appl. Writ No. 328/2014
1. The Deputy Housing Commissioner, Rajasthan Housing Board,
Sector 5, Bypass Kuri Bhagtasni Scheme, Jodhpur Circle- First,
Jodhpur.
2. The Resident Engineer, Rajasthan Housing Board, Sub-Division
III, 1-B-119, Kuri Bhagtasni Housing Board, Jodhpur.
                                                                     ----Appellants
                                      Versus
1. Smt. Lalita Agarwal W/o Shri Ram Chandra Agarwal, R/o
Phophalio Ki Pole, Nimbia Kuwa, Jodhpur.
2. State of Rajasthan through Secretary Rajasthan Housing
Board, Jaipur, Government of Rajasthan, Jaipur.
                                                                   ----Respondents


                   D.B. Spl. Appl. Writ No. 703/2015
1. Raj. Housing Board through its Chairman, Jaipur.
2. Financial Advisor, Rajasthan Housing Board, Jaipur.
3. Deputy Housing Commissioner,                     Rajasthan Housing Board,
Circle-II, Jodhpur
4. Residential (sic Resident) Engineer, Rajasthan Housing Board,
Divisio-I, 1-B-119, Kuri Bhagtasni Housing Board, Jodhpur.
                                                                     ----Appellants
                                      Versus
Deepak Jangid S/o Shri Lala Ram Suthar, R/o Plot No.28,
Amardeep, Shivaji Marg, Pal Road, Jodhpur Presently C/o
Mahalaxmi Udyog, S-5 III Phase, Chetan Baba ki Jhonpadi, Kher
Road, Balotra.
                                                                   ----Respondent




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For Appellant(s)              :     Mr. Amit Tatia
For Respondent(s)             :     Mr. D.D. Chitlangi
                                    Mr. O.P. Mehta
                                    Mr. P.R. Mehta
                                    Dr. Harish Purohit
                                    Mr. V.D. Gaur
                                    Mr. Shashank Sharma
                                    Mr. Yogendra Singh Arnay
                                    Mr. Anil Kumar Birda
                                    Mr. Sandeep Bishnoi
                                    Mr. Rahul Balana for Mr. Himmat
                                    Jagga
                                    Mr. Bhushan Singh



 HON'BLE THE CHIEF JUSTICE MR. MANINDRA MOHAN SHRIVASTAVA

                 HON'BLE MR. JUSTICE MUNNURI LAXMAN

Reportable                          Judgment

15/02/2024

1.    Heard.

2. These appeals arise from common order dated 24.09.2013

passed by the learned Single Judge in the matter of challenge to

the action of the appellant in cancellation of the auction

proceedings towards allotment of plots to intending allottees

under a scheme of the Housing Board.

3. Appellant had floated an advertisement dated 26.03.2012

initiating process of auction of the plots developed by the

appellant-Housing Board for public benefits. The respondents-writ

petitioners participated in the auction proceedings and offered bid

prices for respective plots of their choices. The auction was

concluded and as per the terms and conditions of the auction

notice, the successful bidders/respondents-writ petitioners

deposited 15% of the bid amount offered by them. While the

successful bidders were expecting confirmation letters and

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allotment of respective plots upon deposit of the balance amount,

they came to know that the entire auction proceedings, for all the

plots which were auctioned under auction notice dated

26.03.2012, have been cancelled.

4. Aggrieved of the said decision taken by the appellant-

Housing Board whereby, the entire auction proceedings were

cancelled, petitions were filed. Challenge to the decision of the

Housing Board to cancel the auction proceedings was assailed

mainly on the ground that the petitioners had submitted their

offers, which were treated as highest auction in respect of the

respective plots for which their offer was submitted and all those

offers were invariably higher than the Minimum Sale Price ('MSP'

for short) fixed by the Housing Board itself and in absence of there

being any concrete reason, cancellation of the auction proceedings

was arbitrary and irrational.

5. The action of the cancellation was sought to be defended by

the appellants, by filing a common reply in two writ petitions,

stating that even though auctions were held after determining the

MSP in the year 2012 but the Chairman of the Board found that

the bids received and tentatively accepted by the Board on the

spot were marginally above the MSP fixed and, therefore, a

decision was taken on records and files to drop the auction

proceedings determining new MSP and then to go for a fresh

auction.

6. The stand taken by the appellants before the learned Single

Judge was rejected. The learned Single Judge held that once the

intending purchasers/writ petitioners had emerged as successful

bidders in respect of their respective plots and the bid price

[2024:RJ-JD:8078-DB] (9 of 19) [SAW-1322/2013]

offered by them was invariably higher than the MSP, there was no

reason why the auction proceedings should be cancelled. It was

also found on facts that 15% of the bid amount offered by

respondents-writ petitioners was also accepted upon completion of

the auction proceedings and thus, there was no violation of any of

the terms and conditions of auction. Learned Single Judge was

also of the view that once the auction proceedings are concluded

and 15% advance is deposited, it amounts to acceptance of offer,

giving rise to a concluded contract.

7. The writ petition was accordingly allowed by the impugned

order and the appellant was directed to finalize the allotment of

plots in question in favour of the writ petitioners, subject to writ

petitioners depositing the balance amount.

8. Assailing the correctness and validity of the order passed by

the learned Single Judge, learned counsel appearing for the

appellant-Housing Board would vehemently contend before us that

the directions of the learned Single Judge to accept the bid

amount of the respondents-writ petitioners, despite cancellation of

bid, is grossly illegal and unsustainable in law. He would submit

that it is not a case where the allotment of plots had taken place

after accepting the full amount. He would submit that before the

bid amount offered by the writ petitioners could be accepted by

the competent authority, it came up for consideration that present

are the cases where the minimum sale price would require

revision and, therefore, on that basis, a decision was taken to

cancel the entire auction proceedings. He would submit that it is

not a case where any pick and choose was adopted by the

appellant-Housing Board. Irrespective of any plot, all the plots

[2024:RJ-JD:8078-DB] (10 of 19) [SAW-1322/2013]

were closed and auction was cancelled. He would submit that the

writ petitioners had only submitted their offer and merely because

they emerged as the highest bidders and deposited 15% of the bid

amount as per the auction notice, it cannot be said that any

indefeasible right accrue in their favour to get the allotment. The

proceedings, before it could be finalized, were cancelled for valid

reasons. He would next submit that the writ petitioners have no

right to get allotment, in fact they had no locus standi to file writ

petitions and, therefore, the writ petitions were required to be

dismissed only on this ground. He would next submit that insofar

as the finding of a concluded contract is concerned, the learned

Single Judge has relied upon the Division Bench judgment of this

Court in which, on different set of facts and circumstances,

conclusion of fact has been drawn regarding that being a

concluded contract case, whereas, in the present case, neither in

the auction notice nor in the rule relating to auction it has been

notified that deposit of 15% of the bid amount by the successful

bidders would be treated as acceptance of the offer so as to give

rise to a concluded contract. Lastly, he would submit that present

is a case of revision of MSP. That being a subjective decision taken

on administrative side, in the absence of any allegation of

malafide, the same could not be subjected to scrutiny under

limited scope of judicial review under Article 226 of the

Constitution of India. In support of his submission, he would place

reliance upon the decision of Hon'ble Supreme Court in the case of

Rajasthan Housing Board and Ors. Vs. G.S. Investments

and Ors. [Civil Appeal No. 4608/2006].

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9. Per contra, learned counsel for the respondents would

submit that the action of the appellant-Housing Board in cancelling

the auction proceedings has no rhyme or reason and it has rightly

been held to be unjust, arbitrary and irrational by the learned

Single Judge. Their submission is that the Housing Board, in its

reply before the learned Single Judge and even before this Court,

has not come out with any material, much less relevant material,

to support their decision to cancel the auction proceedings. It is

submitted that the petitioners and many other persons had

participated in the process of auction and the auction was under a

public notice. MSP was fixed by the appellants themselves and all

the writ petitioners were those who had submitted their offer more

than the MSP and in many cases the bid amount offered was much

higher than the MSP. In the absence of there being any reason

assigned, the action is patently arbitrary, irrational and, therefore,

violative of Article 14 of the Constitution of India. It is also

submitted that the conclusion of it being a case of concluded

contract, has been drawn by the learned Single Judge relying upon

a Division Bench judgment of this Court in identical fact situation

where deposit of 15% of the money soon after a bidder being

declared highest bidder, has been held to be a case of concluded

contract. Learned counsel for respondents-writ petitioners have

also relied upon decision of the Hon'ble Supreme Court in the case

of The Vice Chairman & Managing Director, City And

Industrial Development Corporation of Maharashtra Ltd. &

Anr. Vs. Shishir Realty Private Limited & Ors. Etc. [Civil

Appeal Nos. 3956/3957 OF 2017].

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10. We have heard learned counsel for the parties and perused

the record, as also the order impugned passed by the learned

Single Judge.

11. At first place, we find that the auction proceedings were

initiated under a public advertisement dated 26.03.2012. Under

this advertisement, the appellant-Housing Board proceeded to

initiate auction proceedings for allotment of plots developed by the

Housing Board. It is beyond any pale of doubt that the Housing

Board is an instrumentality of the State and is enjoined with the

function of developing plots and allotting the same through

auction or tender proceedings, which is an action in public

interest. The object is to provide plots by way of a transparent

process to those who are in need of house and to provide housing

facility to the public at large.

12. The transparency of the process is not in question. The

auction proceedings were held after inviting all the persons who

are desirous of taking plots. It is also not in dispute that the Board

had fixed minimum sale price in respect of offering plots/set of

plots. The minimum sale price was not challenged by any of the

intending bidders, either by filing any representation before the

Board or challenging the same in any Court of law.

13. The case of the writ petitioners that they emerged as

successful bidders in respect of their respective plots, for which

they had submitted their offer, is also not substantially under

challenge. It is an admitted position that, in all the cases, the bids

which were offered, were invariably more than the MSP. The

records also show that in many cases the offers made by the

successful bidders-writ petitioners were far higher as compared to

[2024:RJ-JD:8078-DB] (13 of 19) [SAW-1322/2013]

the MSP. It would thus be seen that the entire process of auction

was not shown to be suffering from any procedural defect of

violation of any provision of law or suffering from any procedural

defect of such nature which would render the auction proceedings

illegal or otherwise arbitrary. In fact, there is nothing on record to

show that anyone challenged the auction proceedings.

14. The records, which were considered by the learned Single

Judge, reveal that the decision to cancel auction proceedings was

taken by the Chairman of Rajasthan Housing Board. Para 6 of the

impugned order, which extracts the relevant contents of the note-

sheets, clearly records that the bids received and tentatively

accepted by the Rajasthan Housing Board on the spot were only

marginally above the MSP fixed and, therefore, in the office note-

sheet, produced before the Court by the parties, quoted

handwritten of the Chairman, was highlighted. The only operative

reason recorded in the note-sheet was as below:

"u;h MSP fu/kkZj.k ds ckn iqu% fuykeh dh tk;A Sd/- Paras

Ram Mordia."

15. The learned Single Judge also noted that the aforesaid note

of the Chairman of Housing Board was despite the report of the

Deputy Housing Commissioner that the proposal for allotment can

be agreed. The complete details of the note-sheets are contained

in para 7 of the order passed by learned Single Judge.

16. It is found that the Chairman and the officers had found that

in some cases, bid amount received was much more than the MSP

and in some cases it was marginally above the MSP. However, one

[2024:RJ-JD:8078-DB] (14 of 19) [SAW-1322/2013]

thing is concluded from the record of the appellants themselves

that in all the cases bid amount was higher than the MSP.

17. Taking into consideration the aforesaid aspect of the matter,

learned Single Judge arrived at a conclusion that in the absence of

there being any other material to support the decision, the action

of the appellant-Housing Board could not be termed as just and

proper.

18. Having extensively heard learned counsel for the parties and

perused the record, we also do not find any material on record to

justify the action of cancellation of entire bid proceedings. The

note of the Chairman only shows regarding fixation of new MSP.

However, why that decision was taken is completely absent from

the records and files as also the reply which has been filed by the

Housing Board in the writ proceedings. Present is not a case

where before conclusion of the auction proceedings and

acceptance of the highest bid amount and issuance of

confirmation letter, some material inputs were received by the

Housing Board that the MSP was wrongly fixed. It is not a case

where any material has been placed before this Court that while

MSP was fixed for allotment of plots, in respect of which auctions

were held, in the auction proceedings of nearby plots much higher

price was fetched. Therefore, there is no material on record to

show that revision of MSP had become necessary.

19. Present is also not a case where any material has been

placed before us that there was any serious irregularity or

illegality committed in the auction proceedings which necessitated

cancellation of the entire auction proceedings. As we have already

noted hereinabove, it is neither the case of the Housing Board nor

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any other material has been placed on record to show that any

challenge was made to the auction proceedings by any other

person.

20. Present is also not a case where a decision was taken to

cancel the auction proceedings on the allegations of any

corruption or nepotism. The auction proceedings were held in a

transparent manner adopting the procedure which is not violative

of Article 14 of the Constitution of India.

21. If none of the aforesaid material was available, we are at

complete loss as to on what basis the Chairman of the Board

decided to revise MSP. In our opinion, such a decision can be only

said to be completely arbitrary, irrational and based on no

material.

22. While it is settled legal position that the decision itself may

not be challenged on the ground of sufficiency of reasons in

proceedings under Article 226 of the Constitution of India and the

Court's consideration would be confined to illegality or procedural

impropriety in decision making process, in the present case, as

from the facts revealed from the records, there is absolutely no

basis why a decision was taken to revise MSP when the auctions

were completed and part of bid amount by the successful bidders

was also deposited. The auction proceedings were held as a

serious exercise by the Housing Board with the object of providing

developed plots to persons, who are in need for construction of

their houses. Much of the energy and money is spent in the

exercise of finalizing terms and conditions of the auction, issuing

advertisement, inviting bids and conducting auction proceedings.

As far as the applicants are concerned, they all are the persons

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who were serious and participated in the auction proceedings so

that they could get plots at the earliest, subject to they being

highest bidders and fulfilling all other terms and conditions of

auction and allotment of plots. Therefore, auction proceedings

once held should not have been cancelled without any strong

basis. In the present case, there is absolutely no basis. Present

is not a case where the Housing Board has come out with certain

reasons which are relevant to decision making process. Had that

be so, this Court would not have interfered with the decision

making process by entering into the aspects which the

administration of the Housing Board alone could examine to take

the decision. Present is a case where there is absolutely no

material to take the decision to cancel the auction proceedings.

Therefore, the action does not satisfy the test of wednesbury

principle.

23. At this stage, we consider it appropriate to usefully refer to

various decisions cited at the Bar in the matter of scope of judicial

review against the action taken by the State in the contractual

matters.

In Kumari Shri Lekha Vidyarthi and Ors. Vs. State of

U.P. and Ors. [AIR 1991 SC 537], Hon'ble Supreme Court

observed as below:

"xxx

21. The Preamble of the Constitution of India resolves to secure to all its citizens Justice, social, economic and political; and Equality of status and opportunity. Every State action must be aimed at achieving this goal. Part IV of the Constitution contains "Directives Principles of State Policy" which are fundamental in the governance of the country and are aimed at securing social and economic freedoms by appropriate State action which is

[2024:RJ-JD:8078-DB] (17 of 19) [SAW-1322/2013]

complementary to individual fundamental rights guaranteed in Part III for protection against excesses of State action, to realise the vision in the Preamble. This being the philosophy of the Constitution, can it be said that it contemplates exclusion of Article 14-non- arbitrariness which is basic to rule of law-from State actions in contractual field when all actions of the State are meant for public good and expected to be fair and just? We have no doubt that the Constitution does not envisage or permit unfairness or unreasonableness in State actions in any sphere of its activity contrary to the professed ideals in the Preamble. In our opinion, it would be alien to the Constitutional Scheme to accept the argument of exclusion of Article 14 in contractual matters. The scope and permissible grounds of judicial review in such matters and the relief which may be available are different matters but that does not justify the view of its total exclusion. This is more so when the modern trend is also to examine the unreasonableness of a term in such contracts where the bargaining power is unequal so that these are not negotiated contracts but standard form contracts between unequals.

In The Vice Chairman & Managing Director, City and

Industrial Development Corporation of Maharashtra Ltd. &

Anr. Vs. Shishir Realty Private Limited & Ors. Etc. [Civil

Appeal Nos. 3956-3957 OF 2017], Hon'ble Supreme Court has

held as below:

"xxx

28. This Court in the case of M/s Star Enterprises v. City and Industrial Development Corporation of Maharashtra Ltd., (1990) 3 SCC 280 reiterated the aforesaid concerns and stated the necessity of judicial review even with respect to the commercial transactions undertaken by the State. This Court held as follows:

"10. In recent times, judicial review of administrative action has become expansive and is becoming wider day by day. The traditional limitations have been vanishing and the sphere of judicial scrutiny is being expanded. State activity too is becoming fast pervasive. As the State has descended into the commercial field and giant public sector undertakings have grown up, the stake of the public exchequer is also large justifying larger social audit, judicial control and review by

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opening of the public graze; these necessitate recording of reasons for executive actions including cases of rejection of highest offers. That very often involves large stakes and availability of reasons for actions on the record assures credibility to the action; disciplines public conduct and improves the culture of accountability. Looking for reasons in support of such action provides an opportunity for an objective review in appropriate cases both by the administrative superior and by the judicial process." (emphasis supplied)

24. The decision which has been relied upon by the appellant

Board is rightly held distinguishable, on facts, by the learned

Single Judge. G.S. Investments (supra) was a case where the

Court, on facts, found that the bids which were offered were for

the amount which were far less than the bid price, which were

offered in the earlier process. Having noted that, a decision was

taken to cancel the bid and in that conspectus of facts and

circumstances, the Court refused to interfere with the decision to

cancel the bids. The said situation is not applicable in the present

case. Present is not a case where the MSP fixed has been found

to be lesser than the MSP in any previous auction proceedings of

the contiguous plots. On the contrary, we find that even the