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1993 DIGILAW 373 (PAT)

Shobhi Narayan Singh v. Bihar State Agriculture Marketing Board

1993-08-27

R.N.PRASAD, S.B.SINHA

body1993
JUDGMENT : S. B. Sinha, J. - .The petitioner in this application has questioned the order dated 16.6.1993 passed by the Managing Director of the Bihar State Agriculture Marketing Board in Misc. Case no. 9 of 1993. 2. The fact of the matter lies in a very narrow compass. 3. An advertisement was issued on 16th March, 1993 by the Secretary of Agricultural Produce Market Committee, Dhanbad (Respondent no.4) inviting tenders for settlement of Raj Ground Bakri Hat. The minimum guarantee amount of the said Hat was Rs. 3.59 lacs and one of the condition embodied thereunder was that the participant of the bid must produce a• character certificate. Allegedly respondent no.5 could not produce character certificate and a bid was held on 16.3.1993 in which the petitioner became the highest bidder having offered a sum of Rs. 3,70,100/-. The petitioner deposited 50% of the bid amount and Parwana dated 27th March, 1993 was issued. According to the petitioner, thereafter he is collecting toll in terms of the said Parwana. Admittedly, respondent no. 5 made a complaint before the Deputy Commissioner, Dhanbad to the effect that the character certificate was not issued to him by the Sub-divisional Officer who was ex-officio Chairman of the Market Committee. However, the Deputy Commissioner did not interfere in the said matter and. respondent no. 5 filed a writ petition in the Ranchi Bench of this High Court being CWJC No: 1248 of 1993(R) and by an order dated 13.5.1993 the said application was permitted to be withdrawn in order to enable the respondent no.5 to file representation before the Managing Director of the Bihar Agriculture Marketing Board. Both the petitioner and respondent no. 5 were directed to appear before the Managing Director of the Board on 3rd June, 1993. By reason of the impugned order dated 16.6.1993 the Managing Director directed the Market Committee to re-open the bid and also directed respondent no. 5 to deposit through bank draft a sum of Rs. 4,50,000/- by 25th June, 1993. 4. Show cause has been filed on behalf of respondent no. 5 and counter affidavit has been filed on behalf of respondent nos. 1, 2 and 4, respondent no.5 in his show cause, inter alia, stated that he has been taking settlement of the said Hat and in previous years the said Hat was settled for a sum of Rs. 4,81,000/-. According to respondent no. 5 and counter affidavit has been filed on behalf of respondent nos. 1, 2 and 4, respondent no.5 in his show cause, inter alia, stated that he has been taking settlement of the said Hat and in previous years the said Hat was settled for a sum of Rs. 4,81,000/-. According to respondent no. 5 his application for grant of character certificate had been sent by the Sub-divisional Officer, Jharia to the Officer Incharge of Jharia Police Station on 12.3.1993 and on 15.3.1993 a report was sent to the office of the Sub-divisional Officer by the Officer Incharge that there is no complaint against the respondent no. 5. According to the respondent no. 5 Sub-divisional Officer did not issue character certificate to him. On 16.3.1993 the respondent no. 5 went to the office of the Sub-divisional Officer and he was told that the character certificate was with the Sub-divisional Officer, but at about 10.45 A.M. on that day when the respondent no.5 reached the premises of the Market Committee, for participating in the auction and requested the Sub-divisional Officer to give the character certificate, he was told that the character certificate is in the office. Allegedly, the respondent no.5 showed the photostat copy of the recommendation of Jharia Police but the Sub-divisional Officer insisted that respondent no.5 should go to his office and collect the character certificate. Respondent no. 5 prayed for 45 minutes time so that he may go to the S.D.Os office and collect the character certificate. But again the character certificate was not given to him by the office of the Sub-divisional Officer. When he came to the Market yard after half an hour, he found that bid has already been taken place and the highest bid was Rs. 3,70,000/-. 5. In their counter affidavit, respondent nos. 1, 2, & 4, inter alia, contended that Annexure-4 is provisional parwana, which has been issued in favour of the petitioner in anticipation of approval and thus, the same is not agreement which binds both the parties thereto. It has been contended that a guideline has been issued on 27.12.1985 wherein it has been stated that approval of the Marketing Board is required to be taken in case of settlement of Hat and Bazar and Cattle fair when the bid amount is more than Rs. 50,000/-. It has been contended that a guideline has been issued on 27.12.1985 wherein it has been stated that approval of the Marketing Board is required to be taken in case of settlement of Hat and Bazar and Cattle fair when the bid amount is more than Rs. 50,000/-. According to the respondents, the said office order dated 27.12.1985 as contained in Annexure-A to the counter affidavit was issued in terms of Section 31(ii) of the Bihar Agriculture Produce Market Act (hereinafter to be referred as 'the said Act'). It has further been submitted that the Managing Director has power of superintendence and control over the working of the Market Committee. It has further been stated that in this case the Managing Director acted under the Directions of the Hon'ble High Court in C.W.J.C. No. 1248 of 1993 (R) apart from his power under Section 38 of the Act. It has been stated that respondent no. 5 in his application contended as follows: "(i) the petitioner has been taking auction for the last several years and there was no allegation against his character. (ii) the petitioner seeing the notice of auction in the news-paper had applied for a character certificate. The character report was duly sent to the S.D.M. by the Officer-in-charge of the Police Station. The petitioner could not get the character certificate in spite of his best efforts before the final date of auction that was on 16.3.93. (iii) The petitioner has alleged malafide intention on the part of the SDM who is the Chairman of the Market Committee for not issuing the character certificate deliberately. (iv) The petitioner pointed out that the auction of 1993-94 is a collusive bid which is apparent from the fact that in the auction for the year 1990- 91, the bid amount went up to 4 lacs 81 thousand whereas after the gap of two years bid amount has been reduced to 3 lacs 70 thousand and , 1 hundred rupees. (v) The petitioner has offered that he is ready to deposit 6.lacs rupees for one financial years." It has further been submitted that the impugned order has been passed bonafidely and in the interest of the Market' Committee. 6. Mr. (v) The petitioner has offered that he is ready to deposit 6.lacs rupees for one financial years." It has further been submitted that the impugned order has been passed bonafidely and in the interest of the Market' Committee. 6. Mr. Umesh Prasad Singh, learned counsel appearing on behalf of petitioner, inter alia, submitted that although 11 A.M; was the time fixed for holding the bid on 16.3.1993, only at 12 noon a• request was made by respondent no. 5 to postpone the same and as even after the expiry of 45 minutes he did not participate and the bid in question was held. Learned counsel submitted that in the facts and circumstances of his case Section 38 of the said Act cannot be said to have any application. He further submitted that in terms of Section 31 of the Act only the persons mentioned therein could enter into an agreement and in that view of the matter the purported direction as contained in Annexure-A to the counter affidavit cannot be said to have any force of law. It has further been submitted that in any event before exercising his jurisdiction under Section 38 of the Act, it was obligatory on the part of the Managing Director of the Board to arrive at a finding that illegality has been committed in the matter of holding the auction. Learned counsel in support of his contention has relied upon V. T. Khanzode & others vrs. Reserve Rank of India and another, reported in A.I.R. 19R2 S.C. 917, Sayed Ajaj Ahmad vrs. State of Bihar & others reported in 1992(2) P.L.J.R. 369 . 7. Mr. N. K. Agrawal and Mr. Rajeshwar Prasad appearing on behalf of Respondents, on the other hand, submitted that the facts of this case clearly shows that respondent no. 5 was prevented from participating in the bid. According to the learned counsel from a perusal of his representation to the Deputy Commissioner, which is contained in Ani1exure-A to the show cause, it would be evident that all the facts stated in the show cause were stated before the Deputy Commissioner on 16.3.1993 itself and thus, it cannot be said that the plea taken by respondent no. 5 in the earlier writ petition or before the Managing Director of the Board was by way of an afterthought. 5 in the earlier writ petition or before the Managing Director of the Board was by way of an afterthought. It was further submitted that the Managing Director had the requisite jurisdiction not only under Section 38 of the said Act but also in view of the fact that the Board has the power of superintendence in terms of Section 33 J of the said Act. 8. It is not necessary to consider the questions with regard to the interpretation of Section 38 of the said Act in the present case. In terms of clause 4 of the advertisement as contained in Annexure- 1 to the writ application authority to realise market fee could be issued to the petitioner not only upon deposit of the amount in the manner as stated in the clause preceding• thereto but upon entering into an agreement. The petitioner was, therefore, not entitled to grant of a Parwana unless an agreement had been entered• into. 9. Further the petitioner himself has annexed a copy of the letter dated 26.2.1991 issued by the Managing Director of the Board, whereby and whereunder participants have been directed to produce character certificate from the concerned authorities before he took part in auction. Even in the Parwana dated 30th March, 1993 as contained in Annexure-4 to the writ application, it will appear that a provisional Parwana has been issued, in anticipation of the approval thereof presumably by the Board in terms of Annexure-A to the counter affidavit. Further from a perusal of the order dated 13.5.1993 as contained in Anncxlire-5 to the writ application, it is evident that this Court accepted the contention of the learned counsel appearing on behalf of respondent Market Committee that the matter relating to finalisation of the bid is still pending before the Managing Director of the Committee. 10. A decision of this Court in Sayed Ajaj Ahmad vs. The State of Bihar & Ors., 1992 (2) P. L. J. R. 369 was referred to before it and in that situation this Court passed the following order: "From the decision in the aforesaid case, it is clear that the. petitioner can raise all objections sought to be raised before us, , before the Managing Director and he would consider them before, according or withholding his approval in respect of the settlement of the Hat on the basis of the impugned auction. petitioner can raise all objections sought to be raised before us, , before the Managing Director and he would consider them before, according or withholding his approval in respect of the settlement of the Hat on the basis of the impugned auction. In this view, we are not inclined to entertain this application at this stage. We directed that the petitioner, if so advised, may file a representation before the Managing Director raising all his objections. We make it clear that we have not applied our mind to the merits of this case and any observation made in this order will not be construed as a remark or opinion either for or against the petitioner or the private respondent. The petitioner, if he so intends, must file his representation on or before 27.5.1993 after serving a copy of the same on respondent no.5 Both the petitioner and respondent no.5 shall then appear before the Managing Director on 3rd June, 1993. The Managing Director will hear the parties either on the same day or will fix a suitably short date for the hearing of the parties after which the representation of the petitioner will be finally disposed of on or before 21st June, 1993. We are passing this order in the presence of the counsel for respondent no. 5 and the Market Committee. Learned Counsel appearing on behalf of respondent no. 5 assure that his client would accept the copy of the representation proposed to be served upon him by the petitioner.” 11. From the aforementioned order dated 13.5.1993 it is evident that although the said order was passed in his presence, Respondent no. 5 did not raise contention that Section 38 of the Act will have no application whatsoever nor he raised the contention that the Managing Director of the Board had no jurisdiction to give his approval with regard to acceptance of bid in view of the provisions contained in Section 31 (i) of the said Act. It is also clear that petitioner and respondent no. 5 both appeared before the Managing Director of the Board and submitted themselves to his jurisdiction. 12. It, therefore, in my opinion, would not be proper to allow the petitioner to raise the question of jurisdiction in this case. It is also clear that petitioner and respondent no. 5 both appeared before the Managing Director of the Board and submitted themselves to his jurisdiction. 12. It, therefore, in my opinion, would not be proper to allow the petitioner to raise the question of jurisdiction in this case. The petitioner has, therefore, abandoned the issue with regard to the jurisdictim1 of the Managing Director of the Board in the earlier application as also by reason of his appearance before the Managing Director of the. Board without any demur whatsoever. It is now well settled that the High Court while exercising jurisdiction under Articles 226 & 227 of the Constitution of India may not allow any party to raise the issue which has also been abandoned in the earlier writ petition. Reference in this connection may be made to Smt. Shashi Bala Verma versus The State of Bihar & others reported in 1993(1) P.L. J. R. 454. 13. Further it is well known that a party having not raised the question of jurisdiction at the first instance may not be permitted to do so for the first time in the writ jurisdiction. Reference in this connection may be made to Sohan Singh and others versus General Manager, Ordnance Factory, Khaneria, Jabalpur and others, reported in A.I.R. 1981 S. C. 1862, wherein it has been held as follows : "The High Court seems to have taken the view that the trial of such an issue was beyond the competence of the Labour Court; but it has rightly been pointed out on behalf of the appellants that instead of challenging the competence of the jurisdiction of the Labour Court to try issue no. 4, the respondent went to trial, submitted to its jurisdiction and when a decision was given against them by the Labour Court, they for the first time, challenged its jurisdiction to try that issue in the High Court. On the facts of this case, therefore, we are satisfied that the High Court ought not to have entertained the point of jurisdiction urged on behalf of the respondents and set aside the order of the Labour Court on that 14. On the facts of this case, therefore, we are satisfied that the High Court ought not to have entertained the point of jurisdiction urged on behalf of the respondents and set aside the order of the Labour Court on that 14. In V. T. Khanzode and others vs. Reserve Bank of India and another, reported in A.I.R. 1982 Supreme Court 917, it was held that a statutory Corporation can do only such acts as are authorised by the statute creating it and that the powers of the Corporation cannot extend beyond what the statute provides expressly or by necessary implications. In that case, the Supreme Court itself, however, has observed that this docs not, however, mean that the Central Board of Directors of the Reserve Bank is not competent to issue the circular regulating the conditions of service of the Bank staff and the Central Board must frame regulation under Section 58 (1) only. It is now well known that the Board which has supervisory jurisdiction can issue circulars from time to time to the inferior authorities, over whom it exercises its supervisory jurisdiction. Such administrative instructions arc issued for smooth functioning of the Market Committee and in public interest. 15. In Sterling Computers Ltd. V. M & N Publication Ltd., reported in 1993(2) P. L. J. R. 12 (SC) the Supreme Court upon taking into consideration its various earlier decisions held: "If the contract has been entered into without ignoring the procedure which can be said to be basic in nature and after an objective: consideration of different options available taking into account the interest of the State and the public, then Court cannot act as an appellate authority by substituting its opinion in respect of selection made for entering into such contract. But, once the procedure adopted by an authority for purpose of entering into a contract is held to be against the mandate of Article 14 of the Constitution the Courts cannot ignore such .action saying that the authorities concerned must have some latitude or liberty in contractual matters and any interference by Court amounts to encroachment on the exclusive right of the executive to take such decisions." 16. In this connection, it is relevant to note that respondent no. 5 has alleged malafide against the Sub-divisional Officer. In this connection, it is relevant to note that respondent no. 5 has alleged malafide against the Sub-divisional Officer. The Sub-divisional Officer was not only required to grant character certificate in favour of respondent no.5 but he was also the ex-of-ficio Chairman of the Bihar Agriculture Produce Market Committee. It has not been denied and disputed that respondent no.5 has been taking part in the auction in the earlier years and the bid amount of settlement of the hat in question was much higher the bid amount offered by the petitioner. It is also evident that only three persons participated in the bid including the writ petitioner. 17. In this situation, it cannot be said that the Managing Director committed an error in setting aside the settlement. In view of the fact that the petitioner was granted Parwana subject to the approval of the Board in terms of Annexure-A to the counter affidavit, the agreement should have been entered into by and between the petitioner and the Agriculture Produce Market Committee in terms of Section 31 (1) of the Act only upon approval thereof by the Board. In this case, the petitioner's bid cannot be said to have attained the finality as the same was not approved by the Board. 18. The Managing Director held: "From the argument I come to the conclusion that whereas the petitioner should have taken due precaution in obtaining the character certificate well before the due date of auction, S. D. M., Dhanbad should also have ensured his decision about the charactcr certificate before the auction started. As pa general principle bid is reopened if any other party is ready to offer at least 1 ½ times of the bid amount. The petitioner is ready to take the bid on Rs. 6 lacs for one year and has given an undertaking duly signed by his learned lawyer Shri N. K. Agrawal and petitioner himself". 19. It is, therefore, clear that the impugned order has been passed keeping in view the fact that higher amount can be obtained by reason of settlement of Hat in question .by holding re-auction. However, the Managing Director was not correct in directing• the respondent no. 5 to deposit a sum of Rs. 4,50,000/- by 25th of June, 1993. If re-auction was to be. However, the Managing Director was not correct in directing• the respondent no. 5 to deposit a sum of Rs. 4,50,000/- by 25th of June, 1993. If re-auction was to be. held all the participants should be allowed to take part therein without any predetermined motion and the offer made by all the parties should be considered afresh. However, respondent no. 5 in his show cause has stated that he has already deposited the said amount within the time granted by the Managing Director. 20. In this situation, this writ application is disposed of with an observation that the auction may now be held as early as possible after giving due publicity in the news-papers to enable all the intending bidders to take part in the auction. In the event respondent no. 5 becomes the highest bidder, the amount deposited by him should be adjusted. However, in the event the bid offered by some other person is accepted the amount deposited by him should be refunded to him. In the event the petitioner becomes the highest bidder he shall be allowed to continue to realise the market fee as if the agreement has been entered into in his favour with effect from 1.4.1993 subject to the deposit of balance amount, if any. However, if the bid of the petitioner is not accepted he would be entitled to refund of proportionate amount upon taking into consider-at ion the period during which he has already realised market fee. 21. The Managing Director of the Respondent-Board shall, upon conclusion of the auction, dispose of the matter relating to grant of approval at an early date "and preferably with one week from the date of receipt of the recommendations of the Agricultural Produce Market Committee. R. N. Prasad, J. - I agree.