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1995 DIGILAW 260 (GAU)

K. L. Trading Company Pvt. Ltd v. State of Meghalaya

1995-11-30

A.K.PATNAIK, V.K.KHANNA

body1995
A.K.Patnaik, J.- In this writ appeal, the appellant has challenged the judgment and order dated 2.5.95 of the learned Single Judge of this Court dismissing the Civil Rule No.329 of 1995 (1995 (1) GLJ 530) filed by the appellant. 2. The facts very briefly are that in November, 1994, a Notice Inviting Tender (for short 'NIT') was issued by the Principal Secretary to the Govt. of Meghalaya, Taxation, Finance etc (for short the Principal Secretary) inviting tenders from die registered firms/companies of repute having sufficient experience in lottery business for appointment as distributing agent for the Meghalaya State Lotteries. Pursuant to the NIT, the appellant submitted a tender dated 4.1.95 quoting profits of Rs. 12,000/- per draw and a guaranteed minimum annual profit of Rs.3.00 crore to the Government and enclosed along with his tender various documents including a prize scheme. The respondent No.3 also submitted a tender dated 4.1.95 guaranting a minimum profit of Rs.4.38 crores per year to the Government a minimum of 30 lotteries per day at the rate of Rs.4,000/- per lottery. In the said tender, however, it was stated by the respondent No.3 that the profits may go upto a maximum of Rs. 18.25 crores if 125 draws per day was held in one year. Along with the said tender, the respondent No.3 enclosed various documents including a sample scheme in details. A comparative statement of tenders received from 12 firms/companies was prepared by the Director of State Lotteries, Meghalaya (for short the Director) and sent to the Principal Secretary. In the said comparative statement, against the appellant, it was stated in the remark column that except experience certificate, all general conditions of NIT were fulfilled and it was stated against the respondent No.3 in the remark column that except Income Tax clearance certificate, all the general conditions as per NIT were fulfilled. Thereafter a note was put up on 6.1.95 before the Principal Secretary that the offer of the respondent No.3 provided for the highest amount of guaranteed profit to the Government to the tune of Rs.4.38 crores with the minimum of only 30 lotteries per day which may go upto Rs. 18.25 crores per year if 125 draws per day in one year was allowed and that the respondent No.3 had experience and was currently running Nagaland State Lotteries. 18.25 crores per year if 125 draws per day in one year was allowed and that the respondent No.3 had experience and was currently running Nagaland State Lotteries. It was further stated in the said note that the prize structure in the scheme of the respondent No.3 worked out to Rs.91.07 percent of the gross value of tickets printed for sale which meant that the interest of the public purchasing tickets is sufficiently taken care of. It was further indicated in the said note that the respondent No.3 did not produce Income Tax clearance certificate but the assessment order passed by the Income Tax Authority for the assessment year 1993-94 may be taken as evidence that the firm was well within the income tax net and was being assessed regularly. Regarding the tender of the appellant, it was stated in the note that the scheme in details was not furnished and that the appellant lacked experience in running State Lotteries in other States. The aforesaid note dated 6.1.95 made various comments on the offers of other tenderers and finally suggested that the offer of respondent No.3 may be accepted subject to the execution of an agreement on such terms and conditions as may be mutually agreed upon and the period of agreement may be for 3 years initially which could be extended thereafter. At the end of the note, it was stated that the papers were received after the office hours and all the officers of the Taxation Department had left but in the interest of the Government revenue, the matter is put up directly to the Principal Secretary for approval of the Minister. On the very same day, ie on 6.1.95, the Minister, Taxation approved the proposal for accepting the offer of the respondent No.3. Aggrieved by the said acceptance of the offer of the respondent No.3 by the State Government, the appellant filed Civil Rule No.329 of 1995 under Article 226 of the Constitution which was dismissed by the learned Single Judge by the judgment and order dated 2.5.95 impugned in this appeal. 3. At the hearing of this appeal, Mr. PK Goswami, learned counsel for the appellant, submitted that while the offer of the appellant was Rs. 3. At the hearing of this appeal, Mr. PK Goswami, learned counsel for the appellant, submitted that while the offer of the appellant was Rs. 12,000/- per draw, the offer of the respondent No.3 was Rs.4,000/- per draw and hence" the revenue that the Government would have received by accepting the offer of the appellant would have been three times more than the revenue it would get by j£ accepting the offer of respondent No.3. But the Government, instead of proceeding on the basis of the revenue yield per draw, took into consideration the total profit of Rs.4.38 crores per year to the Government on the basis of 30 draws per day and a total profit of Rs. 18.25 crores per day on the basis of 125 draws per day offered by the respondent No.3. Accordingly to Mr. Goswami, if 30 draws per day and 125 draws per day were allowed also to the appellant during a year, then the total revenue that the Government could have received from the appellant at the rate of Rs. 12,000/- per draw would have been three times more than the amount of Rs.4.38 crores per year and Rs. 18.25 crores per year respectively offered by the respondent No.3. Mr. Goswami vehemently submitted that this being a State lottery of the Government of Meghalaya, the decision regarding the number of draws to be permitted during a year has to be taken by the State Government. Mr. Goswami further submitted that even if the offer of the appellant vis-a-vis the offer of the respondent No.3 is judged from the point of view of the benefit to the public purchasing the tickets, as per the comparative statement of the tenders prepared by the Director, the percentage of prize on the value of the tickets printed for sale was 91.08% as per the scheme of the appellant, whereas that of the respondent No.3 was 91.07. Hence, both in the interest of Government revenue and in the interest of public, the offer of the c appellant was better than that of respondent No.3 and yet the offer of the respondent No.3 was accepted by the State Government. 4. Mr. Goswami pointed out that the grounds for rejecting the offer of the appellant namely, lack of experience of the appellant in conducting lotteries in other State and non-submission of the details of the scheme are arbitrary. 4. Mr. Goswami pointed out that the grounds for rejecting the offer of the appellant namely, lack of experience of the appellant in conducting lotteries in other State and non-submission of the details of the scheme are arbitrary. He argued that the NIT did not require the tenderers to furnish any experience certificate although it indicated that registered firms/companies having sufficient experience would be appointed as Distributing Agent for the Meghalaya State Lottery and if the Government of Meghalaya required the tenderers to furnish experience certificates it should have mentioned the same in the NIT. Mr. Goswami referred to statements in paragraph 2.2 of the memorandum of appeal that the Managing Director of the appellant company, Shri Lakshman Kumar, had been associated with the respondent No.3 and in fact signed agreements on behalf of the respondent No.3 with different State Governments for organising State Lotteries. Regarding the other ground for rejection of the tender of the appellant namely non-submission of details of the scheme by the appellant, Mr. Goswami contended that in the prize scheme submitted along with the tender of the appellant all details were given except the number of draws which was for the Government to decide. He also contended that the note dated 6.1.95 to the Principal Secretary would show that the respondent No.3 had not submitted the Income Tax Clearance Certificate although the NIT expressly required that the tenders were to be accompanied by Tax Clearance Certificate and yet the respondent No.3 was favoured with the contract, Mr. Goswami submitted that the fact that the tenders were processed and finalised in one day and rushed through even after office hours oh 6.1.95 is sufficient to show that the decision to accept the offer of the respondent No.3 was predetermined and arbitrary and violative of Article 14 of the Constitution. 5. Mr. Goswami relied on the judgment of the Supreme Court in the case Ram and Shyam Co. vs. State of Haryana, AIR 1985 SC 1152 for the proposition that where the object of the Government is augmentation of revenue, the State is under an obligation to secure the best price available in the market. 5. Mr. Goswami relied on the judgment of the Supreme Court in the case Ram and Shyam Co. vs. State of Haryana, AIR 1985 SC 1152 for the proposition that where the object of the Government is augmentation of revenue, the State is under an obligation to secure the best price available in the market. He also relied on the judgment of the Apex Court in Tata Cellular vs. Union of India, (1994) 6 SCC 651 on the scope of judicial review to convince us that this was a fit case for interference with the arbitrary decision of the State Government to accept the offer of the respondent No.3. He also cited the case of Food Corporation of India vs. Kamdhenu Cattle Feed Industries, AIR 1993 SC 1601 in support his submission that cogent reasons must be given before the tender of the highest bidder is rejected. 6. In reply, Mr. Lahiri, learned Advocate General, State of Meghalaya submitted that evaluation of tenderers submitted by the appellant, the respondent No.3 and the other tenderers cannot be a subject matter of judicial review. He argued that in para 15 of the impugned judgment, the learned Single Judge has rightly held that to attract judicial review, the party approaching the Court must show that the administrative action suffers from arbitrariness, unreasonableness and unfairness and that the Court will not interfere with administrative action merely because it is not justified on merit. On facts, Mr. Lahiri submitted that the appellant did not indicate anything with regard to the number of draws in the prize scheme submitted by him along with the tender and this has been taken into consideration by the learned Single Judge in para 16 of the impugned judgment. He further submitted that clauses 1 and 3 of the NIT clearly indicated that only a registered firm/company having sufficient experience in lottery business could be appointed as distributing agent for the Meghalaya State Lottery and that prospective tenderers already running the lotteries in other States and Union Territories should submit along with their tenders, copies of agreement entered into by them with the respective State Government and Union Territory administration. He clarified that these conditions were stipulated in the NIT with a view to ensure that the State Government does not suffer loss as it had suffered in the past by appointing distributing agents who had no previous ex-perience in running State lotteries. Mr. Lahiri urged that all aspects of the mat-ter were considered by the highest authority of the State Government and a decision to accept the offer of the respondent No.3 and reject all other offers including that of the appellant was taken. This was therefore not a fit case where the Court should exercise its discretion under Article 226 and interfere with an administrative decision which is presently yielding a lot of revenue to the State of Meghalaya. 7. Mr. PG Baruah, learned counsel for the respondent No.3, in his reply, submitted that it has been laid down in the case of M/s GJ Fernandez vs. State of Karnataka & others, AIR 1990 SC 958 and the case of M/s Poddar Steel Corporation vs. M/s Ganesh Engineering Works & others that the terms of a tender notice may comprise of essential conditions of eligibility and ancillary or subsidiary conditions and while the essential conditions of eligibility cannot be dispensed with the authorities, the ancilliary or the subsidiary conditions could be relaxed by the authorities. According to him, the condition in the NIT requiring the tenderer to furnish the Income Tax Certificate was not an essential condition, but the condition in the NIT requiring that only registered firms/companies with experience could be appointed as distributing agent for the State lottery of Meghalaya was an essential condition and could not be relaxed by the authorities. Thus, the State Government was right in not insisting on Income Tax Certificate being furnished by the respondent No.3 but it had no discretion to relax the requirement of experience and hence had to reject the offer of the appellant as he did not have the experience of organising lotteries in the other States. Mr. Baruah further pointed that the judgment of the Apex Court in the case of Tata Cellular vs. Union of India (supra) cited by Mr. Goswami supported the case of the respondents that this was not a fit case for judicial review. 8. We have carefully applied our mind to the decisions cited by the learned counsel for the parties. In Ram and Shyam Co. Goswami supported the case of the respondents that this was not a fit case for judicial review. 8. We have carefully applied our mind to the decisions cited by the learned counsel for the parties. In Ram and Shyam Co. vs. State of Haryana (supra), the Supreme Court held that disposal of public property partakes the character of a trust and hence it must be done at the best price so that larger revenue coming into the coffers of the State serves public purpose. In the case of FCI vs. Kamdhenu Cattle Feeds Industries Ltd (supra), the Supreme Court held that a public authority possesses powers only to use them for public good and this imposes a duty on him to act fairly. He further held that though the highest tenderer can have no claim as of right to have his tender accepted, yet the power to reject his tender cannot be exercised arbitrarily and must depend for its validity on the existence of cogent reasons. In the recent case of Tata Cellular vs. Union of India (supra), the Supreme Court while laying down principles with regard to judicial review held that the Govt. must have the freedom of contract and allowed fairplay in the joints, but the decision of the Govt. must not only be tasted by the application of Wednesbury principle of reasonableness but must be free from arbitrariness not affected by bias or actuated by malafide. It has been further explained in the said decision that quashing of decision may impose heavy burden on the administration and lead to increased unbudgeted expenditure. Regarding the terms and conditions of NIT, the Apex Court held in the case of M/s GJ Fernandes vs. State of Karnataka (supra) that the party issuing tender has a right to punctiliously and rigidly enforce conditions and stipulations in the tender notice but if it chooses to deviate from any condition or stipulation of the tender notice, it should not do so in a manner which result in some substantial prejudice or injustice to any of the parties or to public interest in general. It was further clarified in the said decision that where a person complains before the Court that a departure from the qualification has kept him out of the race, injustice is less apparent where the attempt before the Court is only to gain immunity from competition. It was further clarified in the said decision that where a person complains before the Court that a departure from the qualification has kept him out of the race, injustice is less apparent where the attempt before the Court is only to gain immunity from competition. It was further held in the said decision that once a tender of a party has received due and full consideration, no injustice could be said to have been caused to that party by consideration of its tender side by side with mat of another and by the authorities choosing the better of the two parties on their comparative merit such as experience in the line of work, better qualification for the contract etc. Relying on the said decision in the case of M/s G J Fernandes vs. State of Karnataka (supra) the Supreme Court held in Poddar Steel Corporation vs. Ganesh Engineering Works (supra) that as a matter of general proposition it cannot be held that an authority inviting tender is bound to give effect to every term mentioned in the notice meticulously and cannot waive even a technical irregularity of little or no significance. In the said case, the Supreme Court made a distinction between the essential conditions of eligibility and ancilliary or subsidiary conditions stipulated in a tender notice and held that while the" authority issuing tenders may be required to enforce the essential conditions rigidly, it was open for it to deviate from the strict literal compliance of the subsidiary or ancilliary conditions in appropriate cases. 9. Coming now to the facts of the present case, the NIT which was issued by the Principal Secretary is extracted herein below : 1. Sealed tender affixing Court fee stamp of Rs.25/- and accompanied with upto date Tax Clearance Certificate, Earnest Money of Rs.2 lakhs in the shape of a demand draft drawn on any Nationalised Bank in favour of the Director, Meghalaya State Lottery, Shillong and a scheme in details are hereby invited from registered firms/companies of repute having sufficient experience in the lottery business for appointing as Distributing Agent for the Meghalaya State Lottery for a period of 3 years more or less as mutually agreed upon. 2. Minimum annual guaranteed profit expected is Rs.3 crores which is 2% of the turnover of Rs. 150 crores of the gross total of tickets which may be printed for sale. 3. 2. Minimum annual guaranteed profit expected is Rs.3 crores which is 2% of the turnover of Rs. 150 crores of the gross total of tickets which may be printed for sale. 3. The prospective tenderers already running the lotteries in other States and Union Territories need submit authenticated copies of agreements entered into by them with the respective State Govts and Union Territory Administrations. 4. Terms and conditions and other details are obtainable personally or on request by post from the office of the Director, Meghalaya State Lottery, 30-Lachumiere Hills, Shillong - 793 001, on payment of Rs.200/- only either in cash or in the shape of demand draft. 5. Last date of receipt of tender papers in the office of the Director, Meghalaya State Lottery, Shillong is 15 days from the date of publication of the Notice Inviting Tenders in the newspapers. The tenders received will be opened on the last date at 4 PM in presence of the tenderers or their authorised agents/representative at the office of the Director, Meghalaya State Lottery, Shillong. 6. The undersigned reserves the right to accept or reject any tender without assigning any reason thereof. Sd/- (Rangan Dutta) Principal Secretary to the Govt. of Meghalaya, Excise Registration, Taxation & Stam Deptt. By the aforesaid NIT, sealed tenders, were invited for appointment of distributing agent for Meghalaya State Lottery. Since the lottery is a State lottery of Meghalaya it must have certain essential characteristics of a State, lottery. We find from the records produced before us by the State Govt that in a batch of cases which came before the Apex Court in Civil Appeal Nos.2349-51 of 1994 (State of Haryana vs. M/s Simian Enterprises & others) [ (1994) 4 SCC 217 ], a Bench comprising of 5 Judges of the Apex Court passed interim orders dated 21.4.94 wherein the characteristics of a lottery organised by the State were de-scribed in the following words : "Prima-facie, it appears to us that the concept of a lottery 'organised' by a State would requires certain basic and essential concomitants to be satisfied as, indeed, members of the public when investing their money in such a lottery proceed on a trust and on certain assumptions as to the genuineness, bonafides, safety, security, the rectitude of administration etc associated with Governmental functioning. If some of the basic functions characterising a State-organised lottery are delegated or abdicated by the State this public trust is impaired. The first of those requirements is that the tickets which bear the print and logo of the State must be printed by or directly at the instance of the State Government so as to ensure its authenticity and genuineness and further to ensure that any possibility of duplication of the tickets and sale of fake tickets is provided against and rendered impossible. Secondly, the State itself must sell the tickets though, if it thinks necessary or proper so to do, through a sole distributor or selling agent or several agents or distributors under terms and conditions regulated by the agreement reached between the parties/The proceeds of the tickets either sold in retail or wholesale shall be credited to the funds of the Government. Thirdly, the draws for selecting the prize-winning tickets must be conducted by the State itself, irrespective of the size of the prize-money. Forthly, if any prize money is unclaimed or is otherwise not distributed by way of prize, it must revert to and become the property of the State Government, these, prima facie, appear to us to be the minimal characteristics of a lottery which can claim to be 'organised' by the State." (emphasis supplied) As has been held by the Apex Court in the aforesaid order, in case of a State lottery some of the basic functions of the State cannot be delegated in favour of its distributing agent because any such delegation would erode the public trust in the State and one such basic function which cannot be delegated by the State in favour of its distributing agent is the function of conducting the draws for selecting prize money tickets. In fact, we also find on a reading of Rule 6 of the Meghalaya State Lottery Rules, 1982 as notified by the notification dated 6th August, 1990, a copy of which is kept in the records produced by the State Government, that the draws of the Meghalaya State Lottery are to be conducted by the officers of the State Government. In fact, we also find on a reading of Rule 6 of the Meghalaya State Lottery Rules, 1982 as notified by the notification dated 6th August, 1990, a copy of which is kept in the records produced by the State Government, that the draws of the Meghalaya State Lottery are to be conducted by the officers of the State Government. This being the position of law, it was reasonable for the tenderers submitting tenders pursuant to the NIT to presume that it was for the State Government to take the decision as to the number of draws that it would like to conduct in a year in the Meghalaya State Lottery for the purpose of earning adequate revenue for the State keeping in mind also the interest of the general public purchasing the lottery tickets and that of the society at large and it was not for diem to indicate in their tender or the prize scheme the number of draws to be conducted during the years. Hence the reason given by the authoritites that in the absence of any indication of the number of draws by the appellant in his tender or in the prize scheme submitted by him along with the tender it was not possible for the authorities to consider the tender of the appellant was one which no authority properly directing itself on the relevant law and acting reasonably could have given for rejecting the tender of the appellant. 10. Further, since the decision with regard to the number of draws in a year to be taken by the State Government, the consideration for selecting the distributing agent would be the profit per draw that a distributing agent will earn for the State Government, raising revenue being admittedly the main object of the Meghalaya State Lottery. The appellant offered a profit of fys.12,000/- per draw, whereas the respondent No.3 offered a profit, of only Rs.4,000/- per draw. Hence in every draw that the Government decide to make in respect of the lottery, the Government would have earned a revenue of Rs. 12,000/- from the appellant and a revenue of only Rs.4,000/- from the respondent No.3. The appellant offered a profit of fys.12,000/- per draw, whereas the respondent No.3 offered a profit, of only Rs.4,000/- per draw. Hence in every draw that the Government decide to make in respect of the lottery, the Government would have earned a revenue of Rs. 12,000/- from the appellant and a revenue of only Rs.4,000/- from the respondent No.3. We have, therefore, not doubt in our mind that between the offer of the appellant and that of the respondent No.3 the revenue yield of the offer of the appellant was three times the revenue yield from the offer of the respondent No.3. From the note dated 6.1.95 put up before the Principal Secretary, it is evident that besides the reason that the appellant and not furnished the details of the scheme, the only other reason given for rejecting the tender of the appellant was that the appellant lacked experience in running State lotteries in other States. The appellant, however, has stated in the Memorandum of Appeal that the Managing Director of the appellant company namely Lakshman Kumar was associated with the-respondent No.3 and entered into different agreements with the State Governments on behalf of the said respondent No.3 for organising different State lotteries. Hence if an opportunity had been given to the appellant to show that the appellant company was managed by persons who had experience of running lotteries in other States, the appellant may have produced documents before the authorities in proof of such experience and it was thereafter for the authorities to come to their own conclusion as to whether the appellant really had the requisite experience for being appointed as distributing agent of the State Government for the Meghalaya State Lottery'. Considering the fact that the Government would have earned from the offer of the appellant three times the profits it would earn from the offer of the respondent No.3, the State Government should not have rushed through and finalised the tender in one day on 6.1.95 even after office hours without giving opportunity to the appellant to furnish proof of its experience in running State lotteries in other States or the Union Territories as indicated in the NIT. 11. 11. It is true that it was stipulated in clause 3 of the NIT mat prospective tenderers already running the lotteries in other States and Union Territories should submit authenticated copies of agreement entered to by them with respective State Government and administrations of Union Territories and as per the decision of the Supreme Court in the case of M/sGJ. Fernandas vs. State of Karnataka (supra), the State Government could punctiliously and rigidly enforce the said condition in clause 3 of the NIT and take a view that the tender of the appellant should be rejected as it had not submitted documents in proof of its experience in running State lotteries in other States or Union Territories. But clause 1 of the NIT also stipulated that the tenders must be accompanied by Tax Clearance Certificate and although the tender of the respondent No.3 was not accompanied by a Tax Clearance Certificate as indicated in the note dated 6.1.95 submitted to the Principal Secretary, the said condition in clause 1 of the NIT was relaxed in favour of the respondent No.3 and the offer of the respondent No.3 was accepted by the State Government consistent with the ruling of the Apex Court in the case of M/s G.J. Fernandes vs. State of Karnataka (supra) we .are of the view mat such a relaxation of the condition in the NIT in favour of the respondent No.3 and rejection of the lender of the appellant at the same time on the ground that it did not furnish proof of its experience in running State lotteries in other States or Union Territories caused substantial injustice to the appellant and was arbitrary, discriminatory and violative of Article 14 of the Constitution. It would have been however entirely a different matter if the authorities had given an opportunity to the appellant to produce proof of its experience in running State lotteries in other States or Union Territories and thereafter rejected the tender of the appellant on a comparative merit of the bids of the appellant and the respondent No.3 and other tenders or after taking into account their relative experience in running State lotteries in other States or Union Territories in which case mere would have been hardly any scope for judicial review of the decision of the authorities. 12. 12. Having held that the impugned decision of the State Government to accept the offer of the respondent No.3 and to reject the offer of the appellant was unreasonable, arbitrary, discriminatory and violative of Article 14 of the Constitution we would have normally directed the State Government to reconsider the tenders submitted by the different tenderers pursuant to the NIT. But we find that in the NIT issued by the Principal Secretary a free hand has been allowed to the tenderers to formulate their own. prize schemes in details. In our opinion, it was the duty of the State Government to prevent malapractices which are resorted to by different persons for the purpose of cheating the public on a large scale, and before issuing the NIT the State Government should have first framed a detailed scheme keeping in mind the interest of Government revenue and the public and the distributing agent could only be appointed to operate within such a scheme. In the absence of any such scheme framed by the State Government, the tenderers have submitted prize schemes which prima facie appear to us as not in the interest of the public. In circular dated 26.6.84 of the Ministry of Home Affairs, Government of India, copy of which is in the records produced by the State Government, we find that pursuant to complaints of large scale malpractice in the lottery trade, the Central Government has examined the matter and formulated some broad guidelines to prevent such malpractices. In the said guidelines, only weekly lotteries and bumper have suggested and it has been cautioned that there may be no lotteries with draws at intervals of less than a week. Contrary to these 'guidelines, the offer of the respondent No.3 is that it should be allowed a minimum of 30 draws per day for earning the minimum guaranteed profit of Rs.4,3 8,00,000/- per year and a maximum of 125 draws per day for higher amount of Government revenue and this offer has been accepted and incorporated in clause 4 of the agreement dated 6.1.95 between the State Government and the respondent No.3 .Similarly, we find from the comparative statement prepared by the Director that other tenderers have in their schemes provided for daily draws instead of weekly draws contrary to the said guidelines. 13. In a recent circular dated 30.6.94, the Ministry of Home Affairs, Govt. 13. In a recent circular dated 30.6.94, the Ministry of Home Affairs, Govt. of India has circulated copies of the interim order dated 21.4.94 passed by the Supreme Court of India in Civil Appeal Nos.2349-51 of 1994 quoted above of and has invited the attention of the State Government to the earlier guidelines issued by the Central Government in 1984 and has requested that the conduct of lotteries should be reviewed from time to time at the level of the Chief Secretary, Secretary Finance of the State Govt. as malpractices in the lottery trade continue to be raised in different form in the country. In the larger interest by the general public, we direct that a committee comprising of the Chief Secretary, Secretary, Finance and the Director of Lotteries, Government of Maghalaya State review the conduct of lotteries by the State Government of Meghalaya keeping in mind the guidelines contained in the aforesaid letter dated 26.6.84 of the Govt. of India, Ministry of Home Affairs as well as the principles laid down by the Apex Court in the aforesaid Civil Appeal Nos.2349-51 of 1994 with regard to the limited role of a distributing agent of the State in the case of State lottery, and frame a scheme for running the Meghalaya State Lottery by the end of March, 1996. To ensure that the State Government does not lose any revenue in the meanwhile, we are of the view that till such a scheme is framed by the end of March, 1996 the State Government may allow the respondent No.3 to continue as its distributing agent but in no case will the respondent No.3 be allowed to act as the distributing agent for the Meghalaya State Lottery beyond 31st March, d 19%. In case, however, the State Government decides to appoint a distributing agent for the Meghalaya State Lottery under the scheme as recommended by the aforesaid Committee, a fresh NIT would be issued inviting tenders for appointment of a fresh distributing agent who will operate strictly within the said scheme. In the result, the impugned judgment of the learned Single Judge dated 2.5.95 dismissing Civil Rule No.329 of 1992 is set aside and the writ appeal is disposed of with the aforesaid observations and directions.