Amar Prem And Sons Private Limited vs Rajasthan State Mines And Minerals ...
2025 Latest Caselaw 14665 Raj

Rajasthan High Court - Jodhpur

Amar Prem And Sons Private Limited vs Rajasthan State Mines And Minerals ... on 30 October, 2025

Author: Nupur Bhati

Bench: Nupur Bhati

[2025:RJ-JD:46873]



      HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
                       JODHPUR
                S.B. Civil Writ Petition No. 21206/2025

Amar Prem And Sons Private Limited, Having Its Registered
Address At Shop No. 334, Govindam Commercial Hub, Old Rto
Road Bhilwara, Rajasthan - 311001, Through Its Authorized
Representative Devendra Singh S/o Amar Singh, Aged About 30
Years, Resident Of Tehsil Asind, Ganglas Po Ganglas, Bhilwara,
Rajasthan - 311026
                                                                    ----Petitioner
                                     Versus
1.       Rajasthan    State       Mines       And       Minerals     Limited,    A
         Government      Of    Rajasthan          Enterprises,     Through      Its
         Managing Director, Having Office At Khanij Bhawan, Tilak
         Marg, Jaipur, Rajasthan - 302005.
2.       Manager (Marketing), Rajasthan State Mines And Minerals
         Limited, Sbu And Pc - Lignite, Khanij Bhawan, Tilak Marg,
         Jaipur, Rajasthan - 302005.
                                                                 ----Respondents


For Petitioner(s)         :     Mr. Karmendra Singh
For Respondent(s)         :     Mr. Suniel Purohit


                HON'BLE DR. JUSTICE NUPUR BHATI
                                  ORDER

30/10/2025

1. Learned counsel for the petitioner, at the outset, requested

the Court to hear the matter at this stage itself despite the fact

that no reply has been filed by the respondents' counsel, however,

the respondents' counsel agreed to the said request of the

petitioner and therefore, the instant matter is heard and decided

today itself.

2. The instant writ petition has been filed under article 226 of

the constitution praying following reliefs :-

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"xxxxxxx A. That Impugned Office Order dated 17.10.2025 (Annex.26) issued and passed by Respondent No. 2 on behalf of Respondent no. 1 may kindly be quashed and set aside and it be declared as violative of Article 14 and 19 (1)

(g) of the Constitution of India;

B. That Respondents may kindly be directed to continue the dispatch of Lignite at Kasnau mines on the earlier sale consideration i.e. earlier basic selling price at Rs. 2100 PMT as agreed between the parties immediately.

C. That Respondents may be directed to not to forfeit the Earnest Money Deposit (EMD)/Security Deposit, as available with them, deposited by Petitioner with the respondents, after the expiry of validity of extension period i.e. 30.10.2025.

xxxxxxxx"

3. Brief facts of the case are that the petitioner is a company

incorporated under the provisions of the Companies Act and is

engaged in the business of mining and trading of lignite.

Respondent No. 1 - Rajasthan State Mines & Minerals Limited

(RSMML) - is a Government of Rajasthan enterprise engaged in

mining and marketing of industrial minerals in the State.

Respondent No. 1 invited bids through an e-auction dated

24.10.2024 (Annnex.2) for the sale of Run-of-Mine (ROM) Lignite

from Kasnau Mines, Nagaur, under specified terms and conditions.

The petitioner participated in the said e-auction, was declared a

successful bidder, and was allotted 16,600 metric tonne (MT) of

lignite at a basic price of ₹2,100 per metric tonne, the contract

was valid upto 31st March 2025. A sale intimation letter and

purchase order were thereafter issued by the respondents

confirming the allotment. It is the case of the petitioner that

subsequent to the allotment, the respondents failed to commence

timely production of lignite from the said mines, resulting in

delays, irregular dispatches, inadequate stock availability, and

supply of lignite of inferior quality having excessive moisture

content. The petitioner made several representations and sent

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multiple emails seeking redressal of these issues; however, no

effective action was taken by the respondents. Owing to these

operational difficulties, the respondents themselves extended the

validity period of the e-auction contract on several occasions, and

the validity was ultimately extended up to 30.10.2025(Annex.22).

During this extended period, the petitioner continued to lift lignite

as per the availability at the mines and deposited the requisite

instalments from time to time. Out of the total allotted quantity of

16,600 MT, the petitioner could lift only 9,906.37 MT, leaving a

balance of 6,639.63 MT un-lifted on account of the respondents'

failure to ensure regular and adequate supply. On 17.10.2025

(Annex.26), the respondents issued an Office Order revising the

basic sale price of lignite from ₹2,100 per metric tonne to ₹3,030

per metric tonne with immediate effect, in purported exercise of

powers under Clause 13.5 of the e-auction terms, and called upon

the petitioner to convey its consent to the revised price within

three days in order to continue further dispatches. The petitioner

objected to the said revision, contending that the unilateral

enhancement of the price during the subsistence of the contract

was arbitrary and without justification, particularly when it had

already entered into commitments with its customers at the

earlier rate. The petitioner submitted that such a sudden and

unilateral increase in price would cause severe financial hardship

and disrupt its ongoing contractual obligations. It is the grievance

of the petitioner that despite several representations, the

respondents did not reconsider or withdraw the impugned order

dated 17.10.2025 (Annex.26), thereby halting dispatches of

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lignite and acting in breach of the agreed contractual terms. This

wit petition has been preferred.

4. Learned counsel for the petitioner submits that the impugned

Office Order dated 17.10.2025 (Annex.26), whereby the

respondents have revised the basic sale price before 12 days of

expiration of contract dated 30.10.2025(Annex.22), of lignite from

₹2,100 per MT to ₹3,030 per MT, is arbitrary, unreasonable, and

violative of Articles 14 and 19(1)(g) of the Constitution of India. It

is contended that such unilateral enhancement of price at the fag

end of the contract period, without notice or justification, is dehors

the terms of the e-auction and contrary to settled principles of

fairness.

4.1 He further submits that Clause 13.5 of the Special terms

and Conditions does not confer absolute power on the respondents

to revise prices at will, and any discretion under the said clause

must be exercised reasonably and not in a manner that defeats

the legitimate expectation of the contracting party. He submits

that the abrupt increase of nearly 50% in the basic sale price,

issued just before the Diwali Vacation, demonstrates lack of bona

fides and procedural fairness.

4.2 It is further submitted that the impugned order violates the

doctrines of promissory estoppel and legitimate expectation, as

the respondents had earlier provided that supply of lignite would

continue at the existing price during the extended validity period

up to 30.10.2025 on the basis of which the petitioner entered into

onward supply contracts.

4.3 Learned counsel argues that even in contractual matters,

actions of the State and its instrumentalities must conform to

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constitutional standards of fairness and non-arbitrariness. Reliance

is placed upon Judgment dated 24.07.2023 S.B. Civil Writ

Petition No. 10996/2022 M/S Agrawal Distributors vs.

Rajasthan State Mines and Minerals Ltd. passed by Coordinate

Bench and also relied upon judgment of apex court in the case of

Reliance Energy Limited and Ors. Vs. Respondent:

Maharashtra State Road Development Corporation Ltd. and

Ors. : (2007) 8 SCC 1.

5. Per contra, learned counsel for the respondents submits that

the present writ petition is not maintainable under Article 226 of

the Constitution, as the dispute arises purely out of contractual

obligations governed by the terms of the e-auction agreement

voluntarily executed between the parties. It is contended that the

petitioner, having participated in the bid with full knowledge of all

clauses, including Clause 13.5 of the Special Terms and

Conditions, cannot now challenge its operation after having

derived benefit under the contract.

6. Counsel for the respondents further submits that Clause 13.5

specifically empowers the respondent RSMML to review and

change the basic sale price of lignite at any time during the

currency of the contract, and such power was exercised strictly in

accordance with the said clause. He submits that the impugned

Office Order dated 17.10.2025 revising the price from ₹2,100 to

₹3,030 per MT was issued after due consideration of increased

costs, royalty, levies, and other commercial factors and the

decision applies uniformly to all purchasers and not selectively to

the petitioner.

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7. Counsel for the respondents further submits that the

petitioner voluntarily accepted the tender conditions and

continued lifting lignite thereafter, and hence is estopped by

conduct from challenging the same. He submits that the doctrine

of legitimate expectation has no application as the contract

expressly reserved the right of price revision, and no assurance

was ever given regarding stability of rates. He further submits that

the petitioner did not start lifting the material in first 8 months of

the contract for which, communication via email was also made

with the petitioner and thereafter, which the respondent has

extended the validity till 30.10.2025 (annex.22), without imposing

any penalty. Though, the validity of the contract was for a period

of five months only i.e. from 24.10.2024 upto 31.03.2025

(Annex.2).

8. Counsel for the respondents further submits that the

respondent corporation, being a commercial entity, took the

decision in exercise of its business discretion, and judicial

interference in such price escalation related matters is

unwarranted, prayed that the writ petition be dismissed as not

maintainable and devoid of merit.

9. Counsel for the respondents also draws the Court's attention

to the Bid Sheet dated 16.09.2025. It is submitted that, on one

hand, the petitioner has challenged the revised price on the

ground that it is excessively high--approximately 50% higher--

while, on the other hand, he himself has accepted the price of Rs.

3,020 per MT as reflected in the Bid Sheet at Sr.No.5, for the

same mineral situated in the adjoining mines, therefore, the

petitioner was fully aware of the prevailing price and the

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escalation in costs. He also submits that having voluntarily quoted

and accepted the said price, the petitioner cannot now contend

that the respondents' action in reviewing or revising the price was

arbitrary. Counsel further contends that the case of Agarwal

Distributors (supra) is not applicable to the present matter

because in the case in hand, the relevant clause in the contract

permits RSMML to review the price at any time, consequently, the

petitioner's argument that the respondents were not entitled to

review the price toward the completion of the contract stands

untenable. The Bid Sheet dated 16.09.2025, is taken on record.

10. I have heard and considered the arguments advanced at Bar

by counsel for the parties and perused the material available on

record.

11. The question which come up before this Court in order to

decide the controversy of the present writ petition is as follows:-

(i) Whether the impugned Office Order dated 17.10.2025

(Annex.26) revising the basic sale price of lignite suffers from

arbitrariness, unreasonableness, or violation of Articles 14 and

19(1)(g) of the Constitution.

12. The present case involves a controversy of revision of sale

price under an e-auction contract governed by mutually accepted

terms. The action of respondent RSMML stems from Clause 13.5,

which expressly empowers it to revise the basic sale price. Clause

13.5 is reproduced hereunder:-

"13.5 The management reserves the right to review and change the basic selling price of the successful bidders during validity period of e-auction. In such case, the consent of the successful bidder shall be sought for the changed price. However, there shall not be any forfeiture of Security Deposit on the balance

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un-lifted quantity if the changed price is not accepted by the successful bidder and the lifted quantity completed prior to changed price shall be treated as final."

13. The aforesaid clause of the Special Terms and Conditions

gives respondent RSMML liberty to review and change the basic

selling price of the successful bidder during the validity of the

period of auction. This is an admitted fact that here, in the present

case, the respondents have reviewed and changed the basic

selling price during the validity period of e-auction as the validity

period is coming to an end on 30.10.2025 (Annex.22). Further,

the respondents had sought the consent of the petitioner for the

revised price; however, the petitioner did not accept the reviewed

price. The relevant clause also provides that, in the event the

petitioner does not accept to the change in price, there shall be no

forfeiture of the security deposit for the balance of the un-lifted

quantity, and the quantity lifted prior to such change shall be

treated as final. It is also important to note that the petitioner will

not incur any financial loss if it chooses not to accept the revised

price, as the clause expressly stipulates that there shall not be any

forfeiture of Security Deposit on the balance un-lifted quantity if

the changed price is not accepted by the successful bidder and the

lifted quantity completed prior to changed price shall be treated as

final. Therefore, this is not a situation where the petitioner would

suffer financial detriment or face any penalty upon refusal. The

petitioner's contention that the respondents could not have

reviewed or revised the basic selling price at the verge of

completion of the contract is untenable. The language of the

clause does not prohibit the respondents from reviewing or

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altering the price near the conclusion of the contract. Moreover,

the clause cannot be considered unilateral since the respondents

were obligated under it to seek the petitioner's consent, which

they duly sought. The petitioner, thus, remained at liberty to

either accept or reject the revised terms. In the present case, the

petitioner has refused to accept the revised price, thereby bringing

the contractual obligations to an end with respect to the un-lifted

quantity. The petitioner took part in the auction and signed the

contract knowing well about the Clause 13.5 and did not raise any

objection during the bidding or signing process. After accepting

this term, the petitioner now cannot call the company's action

arbitrary just because the price increase results in financial

implication. Although every decision must be fair and reasonable,

there is nothing to show that the price revision was done with ill-

intention or discrimination. The price increase applies equally to all

buyers and is based on valid business reasons, such as higher

production costs and government levies.

14. Counsel for the petitioner relied on a previous judgment of

this Court in M/s Agrawal Distributors (supra), but the facts of that

case are completely different. In case of M/s Agrawal Distributors

(supra), there was no clause in the contract allowing a price

change, yet the buyers were told to accept new terms. The Court

in that case found the action to be unfair and beyond the contract.

However, in the present case, Clause 13.5 clearly allows RSMML to

revise the sale price anytime during the contract. The petitioner

was fully aware of this and voluntarily agreed to it during the e-

auction. Moreover, the Office Order dated 17.10.2025 does not

force the petitioner to continue; it gives a choice -- either to buy

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lignite at the new price or to stop lifting it. Therefore, the ruling in

Agrawal Distributors (supra) does not have application here, since

the revision of price in this case is based on a clause that both

parties had agreed to.

15. The Hon'ble Apex Court in the case of Har Shankar & Ors.

v. The Dy. Excise and Taxation Commissioner & Ors.

reported in 1975 1 SCC 737; has held that those who offer their

bids in the auction with full knowledge of the terms and

conditions, cannot be allowed to wriggle out their contractual

obligations arising out of the existence of their bids. Further, in

para 17 of the said decision, the Hon'ble Apex Court has also held

that: "Those, who contract with open eyes must accept the

burdens of the contracts along with its benefits.". In the case in

hand, the petitioner has accepted the terms and conditions of the

contract with full knowledge and open eyes including Clause 13.5

of the Contract which gave the respondents an unbridled

authority/power to review the selling price at any point of time

and to any extent. The petitioner, till the date the price was not

reviewed, was satisfied with all the conditions/clauses mentioned

in the contract and only after when the respondents reviewed the

basic selling price, the petitioner was aggrieved. Thus, the

petitioner can not take benefit of some part of the contract & feel

aggrieved of the other part. When the petitioner has accepted the

conditions of the contract with full knowledge, it has to accept the

burden of the contract along with its benefits.

16. The Hon'ble Apex Court in the case of New Bihar Biri

Leaves Co. & Ors. vs. State of Bihar, reported in 1981 1 SCC

537, has applied the maxim "qui approbrat non-reprobat" (one

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who approbates cannot reprobate) and held that if a person of his

own accord, accepts a contract on certain terms and works out the

contract, he cannot be allowed to adhere to and abide by some of

the terms of the contract which proved advantageous to him and

repudiate the other terms of the contract which might be

disadvantageous to him.

17. In Tata Cellular v. Union of India & Ors. reported in

1994 6 SCC 651, the Hon'ble Apex Court held that: "The terms

of the invitation to tender cannot be open to judicial scrutiny

because the invitation to tender is in the realm of contract.". The

petitioner while laying challenge to the Office Order dated

17.10.2025 (Annex.26) is unable to demonstrate that the order is

in contravention to the condition/clause 13.5 of the contract or is

in violation of Article 14 of the Constitution of India, as the

respondents while issuing the Office Order dated 17.10.2025

(Annex.26), have not flouted or gone beyond the condition of the

contract particularly clause 13.5 and further, there is no violation

of Article 14 and 19(1)(g) of the Constitution of India as the

subsequent buyers would also be bound by the reviewed selling

price and thus, when the respondents have not flouted/gone

beyond the condition/clause No.13.5 of the contract, the

petitioner's prayer that: the respondents may be directed to

continue/dispatch of lignite on the earlier basis selling price at

Rs.2,100/- per MT, cannot be granted. The Hon'ble Apex Court in

the case of Tata Cellular (supra) has further held that the duty of

the court is to confine itself to the question of legality and its

concern should be: (i) Whether a decision-making authority

exceeded its powers?, (ii) committed an error of law, (iii)

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committed a breach of the rules of natural justice, (iv) reached a

decision which no reasonable tribunal would have reached, or (v)

abused its powers. Regarding the scope of judicial review, the

Hon'ble Apex Court has observed that:

"xxxxxxx

85. It cannot be denied that the principles of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favouritism. However, it must be clearly stated that there are inherent limitations in exercise of that power of judicial review. Government is the guardian of the finances of the State. It is expected to protect the financial interest of the State. The right to refuse the lowest or any other tender is always available to the government. But, the principles laid down in Article 14 of the Constitution have to be kept in view while accepting or refusing a tender. There can be no question of infringement of Article 14 if the Government tries to get the best person or the best quotation. The right to choose cannot be considered to be an arbitrary power. Of course, if the said power is exercised for any collateral purpose the exercise of that power will be struck down. xxxxxx"

18. This is an admitted position that the contract has come to an

end/coming to an end on 30.10.2025 and in such circumstance,

given the fact that the petitioner vide email dated 23.10.2025

(Annex.27), has refused to accept the revised selling price, the

respondents cannot be directed to continue the dispatch of lignite

at the earlier basic selling price, inasmuch as under clause 13.5 of

the auction notice, the respondent also reserve the right to not

only refuse further extension but also cancel the contract.

19. This Court is also of the view that the occurrence of financial

difficulty, inconvenience, or hardship in performing the conditions

agreed to in the contract cannot justify non-compliance with its

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terms, which the petitioner had accepted with full awareness.

When the petitioner signed the contract, everything was made

transparent to the petitioner and thus, there is no element of

prejudice that can be attributed to the petitioner.

20. As an upshot of the above discussion, the petitioner is not

found to be entitled to the relief as prayed, inasmuch as the

impugned order dated 17.10.2025 (Annex.26) has been passed by

the respondent No.2-Manager (Marketing), Rajasthan State Mines

And Minerals Limited, strictly in consonance with Clause 13.5 of

the Contract; and the petitioner could not be directed to continue

the dispatch of lignite at the mines in question on the earlier basic

selling price @ Rs.2,100/- per MT. The petitioner is further

estopped from challenging the respondents' action in issuing the

Office Order dated 17.10.2025 (Annex. 26), as the said order was

made pursuant to Clause 13.5 of the Contract, under which the

petitioner has been a beneficiary and has enjoyed all the fruits and

benefits of the contract since its inception.

21. The writ petition fails and is hereby dismissed. Stay

application as well as all other pending application(s), if any, also

stand dismissed.

(DR. NUPUR BHATI),J

198-/Devesh/-

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