ORDER: Aggrieved by the Order of injunction granted in I.A.No.351 of 1997 on the file of District Munsif, Ponneri confirmed in C.M.A.No.20 of 1998 on the file of Subordinate Judge, Ponneri, the Deputy Salt Commissioner, Madras-6 has filed the above revision before this Court. 2. The case of the petitioner is briefly stated hereunder: The respondent herein has filed O.S.No.67 of 1997 before the District Munsif Court, Ponneri for the relief of declaration that the petitioner’s action in demanding Rs.126.00 per M.T. is void and for direction to revise the rates at Rs.7.07 and for grant of injunction not to cancel the lease order on the ground of non-payment of security deposit. The petitioner herein has invited tenders for salt manufacture for the lease of 395.96 acres. In response to the said auction, the respondent has given highest offer, hence the lease order was issued in her favour. She was given sufficient opportunity to make security deposit and even the time was extended number of times, but, according to the petitioner the respondent did not choose to fulfil her obligation as per the lease order, hence the same was cancelled. The respondent herein filed the said suit for the relief above mentioned on the ground that the lease amount was exorbitant. It is further stated that in spite of action taken by the Department for surveying the area, fixing the boundary lines and eviction of encroachments, the respondent never tried to enter into the leased area to start the salt manufacture for which it was assigned. Further, the petitioner as requested by the respondent visited the property leased on 5.4.1997 along with the representatives of the respondent, Superintendent of Salt, Chennai Circle and the Factory Officer and shown the area to the representatives of the respondent which is free from encroachments. Even then the respondent has not paid the security deposit and executed the lease agreement, hence several reminders were sent to her to perform her obligations, but the respondent failed to do so. The respondent is not at all interested in manufacturing salt and unnecessarily dragged the issue to delay the payment of Government dues. She also filed the suit only on the ground that different rates were offered to other assignees. Hence the lease of the respondent and the leases of the other assignees have got no comparison at all. The respondent is not at all interested in manufacturing salt and unnecessarily dragged the issue to delay the payment of Government dues. She also filed the suit only on the ground that different rates were offered to other assignees. Hence the lease of the respondent and the leases of the other assignees have got no comparison at all. Though she accepted the rate of payments, the respondent did not choose to fulfill the condition as per the lease order. Since the respondent has got an injunction order in her favour, the petitioner is put to great loss and therefore the lease was not executed and payment had not made by her as per the agreement. 3. The case of the respondent is briefly stated hereunder: The respondent who had made an application for lease of lands to an extent of 395.96 acres for manufacture of salt was furnished with lease orders on 17.1.1994, which requires her to pay security deposit of Rs.7,40,000.00. However the respondent failed to remove the encroachments and other persons doing agricultural operations in the lands in question. She made various representation to the petitioner and other authorities. In spite the obstacles she deposited one lakh rupees towards security deposit and in all paid Rs.3.75 lakhs. It is further stated that she had come to know that in the very vicinity two other companies viz., M/s. SPIC and M/s Priyadarshini Salt Works were granted lease for a period of 20 years. M/s. SPIC was granted lease which was made by transfer of leasehold rights from the erstwhile lessees in favour of M/s. SPIC for 20 years. The lands which were leased out to them admeasures over 702 acres of land and the rate at which the lands was granted was at Rs.7.07 paise per M.T which is abnormally low inasmuch as the rate at which she was granted the lease was Rs.126.00 per M.T. Similarly, lease of 630 acres of land was renewed in favour of M/s Priyadarshini Salt Works at a further low rate of Rs.4.50 per M.T. Both the lands which are in the occupation of M/s. SPIC and Priyadarshini Salt Works are very adjacent to the lands which are to be leased out to her. In view of the high rates as well as existence of encroachments it was impossible for her to carry out and start the business or take the lands for the purposes on conditions as envisaged in the lease. With these objections she filed the said suit before the trial Court and also prayed for injunction in I.A.No.351 of 1997. Taking note of the grievance expressed and in view of existence of encroachment as well as allotment of nearby lands to other companies at the very low rates, the trial Court granted injunction and the same was confirmed by the lower appellate Court. It is further stated that in view of the above factual position and in the absence of any remedial measure by the petitioner, there is no merit in the revision, accordingly she prayed for dismissal of the same. 4. In the light of the above pleadings, I have heard Mr.V.T. Gopalan, learned Additional Solicitor General for the petitioner and Mr.Mohan Parasaran, learned counsel appearing for the respondent. 5. The only point for consideration is, whether the Courts below are right in granting injunction in favour of the respondent herein? 6. There is no dispute that the petitioner - Deputy Salt Commissioner invited tenders for salt manufacture for the lease of 395.96 acres in Survey Nos.172, 178, 466, 346/1 and 348 in Siru Pazhaverkadu and Kadappakkam Villages under the control of Voyalur Salt Factory. The last date of receipt of tenders was 3.1.1994. In response to the Notice of Inviting Tenders (N.I.T.), seven persons submitted their tenders offering various rates. Among the seven persons, the rate quoted by the respondent herein was the highest viz., Rs.126.00 per M.T., of salt produced / issued. It is the definite case of the petitioner that the tenderers were to satisfy themselves about the suitability of the land and the infrastructure facilities available for manufacture of salt. It is further stated that the tenderers have also mentioned specifically about these points, and on satisfaction of these points in the tender forms their offer were considered. It is also stated that the Department has no roll in offering the rates by the tenderers concerned. It is further stated that the tenderers have also mentioned specifically about these points, and on satisfaction of these points in the tender forms their offer were considered. It is also stated that the Department has no roll in offering the rates by the tenderers concerned. It is also not disputed that the respondent herein was the highest tenderer, on that auction being offered Rs.126.00 per M.T., of salt produced/ issued per annum per acre at her own accord and after satisfying the suitability of the land. After accepting her offer, lease order was issued by letter dated 17.1.1994 with a direction to the respondent to pay the security deposit of Rs.7,48,400.00 equal to one year assignment fee as per condition No.6(a) of N.I.T. and payment of ground rent Rs.791.92 at the rate of Rs.2.00 per acre per annum for one year within eight days from the date of receipt of the said letter. In this regard, Mr.V.T. Gopalan, learned Additional Solicitor General has brought to my notice, after verifying the tender conditions and after inspecting the areas in question regarding the suitability or otherwise of manufacture of salt, the respondent herein in her letter dated 3.1.1994 informed the Deputy Salt Commissioner - petitioner herein, about her willingness to comply with all the conditions. In the said letter she had expressed. "With reference to your tender notice, I, Smt, C.R. Jamuna Rani (respondent herein) after inspecting the areas given in the schedule about the suitability of manufacture of salt and availability of other facilities, hereby offer a tender rate of Rs.126.00 as lease money per MT/annum. .................. ..................... I confirm that I have read the notice inviting tender and am fully aware of the various terms and conditions..". (Italics supplied) It is clear that before making an offer in respect of their lands for salt manufacture, respondent herein after inspecting the site accepted the lands in question regarding availability of other facilities etc. It is also relevant to note that the tender notice contains various clauses. The relevant clauses are as follows: "5. (a) The tenderer should quote the rate of Assignment fee that he is willing to pay per Metric Tonne of Salt produced and issued in the proposed area. This rate shall not however be less than One Rupee per tonne. 6. The relevant clauses are as follows: "5. (a) The tenderer should quote the rate of Assignment fee that he is willing to pay per Metric Tonne of Salt produced and issued in the proposed area. This rate shall not however be less than One Rupee per tonne. 6. (a) The successful tenderer shall be required to deposit an amount equal to one year’s assignment fee based on the minimum as per condition No.5(b) above as security deposit to be rounded off to nearest ten rupees. This will be refunded only after the expiry of the term of the lease or its sooner determination as provided for in the lease agreement. 11. (a) In the event of the successful tenderer failing to remit or deposit the amount as stipulated in the above condition or fails to execute and register the required lease deed within the stipulated time, his tender deposit amount of assignment fee, if any , the ground rent and the security deposit equivalent to one year’s assignment fee paid by him shall be forfeited to the Government and steps shall be taken to resettle the land by calling for fresh tenders subject to the conditions as herein after provided. 15. The terms and conditions of lease shall be binding on the successful tenderer and the land in question will be handed over only after the execution of the lease deed by him. 18. The tenderer may inspect the lands in advance and satisfy himself about their suitability for manufacture of salt. Details of S.Nos. etc. of the land can be had from the Factory Officer, Krishnapatnam Salt Factory, Muthukur Mandal, Nellore District, Andhra Pradesh." Though other conditions are there, we are not concerned with all the conditions, hence I am not referring the same. However the above mentioned conditions show that it is incumbent on the tenderer to inspect the lands in advance and satisfy himself/herself about their suitability for manufacture of salt. The other details regarding survey No., boundaries etc., can be verified from the Factory Officer. After knowing all the above conditions and after informing the deputy Salt Commissioner that she was aware of various terms and conditions and provisions from the N.I.T., offered her tender by quoting Rs.126.00 per M.T. of salt produced and issued. 7. The other details regarding survey No., boundaries etc., can be verified from the Factory Officer. After knowing all the above conditions and after informing the deputy Salt Commissioner that she was aware of various terms and conditions and provisions from the N.I.T., offered her tender by quoting Rs.126.00 per M.T. of salt produced and issued. 7. No doubt, Mr.Mohan Parasan, learned counsel appearing for the respondent would state that, in spite of the assurance given by the petitioner, encroachments were not removed by the concerned authorities. Though certain encroachments were there, it is explanied even in the counter filed before the trial Court that by spending Rs.40,000.00 those encroachments were removed with the assistance of the Revenue Authorities. 8. The other objection raised by the respondent for her non-performance in terms of her earlier offer is that, in the very same vicinity two other companies viz., M/s. SPIC and Priyadarshini Salt Works were granted lease for a period of 20 years and in so far as M/s. SPIC is concerned the lease was granted at Rs.7.07 per M.T. and in respect of M/s. Priyadarshini Salt Works the rate was fixed at Rs.4.50 per M.T. It is stated that both the lands allotted to them are very adjacent to the lands of the respondent. It is also stated that they were granted lease for a period of 20 years and over 702 acres of lands were leased out in favour of M/s.SPIC and 630 acres of lands was renewed in favour of M/s. Priyadarshini Salt Works. By pointing out that the action of the petitioner in granting lease of similar lands to the above said companies at a very low rate and asking the respondent herein to pay at the rate of Rs.126.00 per M.T. is unfair and she prayed for reduction of lease amount at the rate of Rs. 7.07 per M.T. per annum. 9. Insofar as grant of lease in favour of the above said Companies viz., M/s.SPIC and Priyadarshini Salt Works, it is explained by the Deputy Salt Commissioner that, M/s. SPIC and M/s. Priyadarshini Salt Works Limited are the existing salt licencees of Voyalor Salt Factory. It is further explained that, in 1987 re-settlement of a land of 702.57 acres was taken up and N.I.T. was issued on 01.12.1987 in which Mr.Vendharatnam and his son Mr.V.Manikandan were highest tenderers and had quoted Rs. It is further explained that, in 1987 re-settlement of a land of 702.57 acres was taken up and N.I.T. was issued on 01.12.1987 in which Mr.Vendharatnam and his son Mr.V.Manikandan were highest tenderers and had quoted Rs. 3.30 per tonne of salt produced and issued per annum and the same was accepted by the Department. They executed a registered lease deed on 15.12.1988. The said lease was valid for a period of 20 years from 9.6.1988. They worked in the area upto 1995. In the year 1996 they requested the Department in their letter dated 10.2.1996 to transfer the area to M/s. SPIC Ltd., as per the Departmental procedure in vogue. Accordingly, the said land was transferred to M/s. SPIC at the rate of Rs.7.07 per M.T. of the salt produced/issued, the highest rate prevailing at the relevant time. As far as M/s. Priyadarshini Salt Works is concerned, it is stated that an extent of 638.69 acres of Central Government lands at Voyalor Salt Factory at Chennai Circle was leased out to them for a period of 20 years from 18.8.1975 to 17.8.1995 at the rate of 4.50 per M.T. for salt produced / issued per annum. Subsequently, the same was renewed for a further period of 20 years with effect from 18.8.1995 by the Salt Commissioner, Jaipur in his proceedings dated 1.3.1996. It is explained that the Departmental procedure for considering the lease hold rights in favour of third party and also renewal of leases are entirely different. In such circumstance, the learned Additional Solicitor General is right in saying that the respondent cannot compare the above said cases with that of her tender case which has a separate set of procedure to be followed and she cannot claim reduction at the rate of Rs.7.07 per M.T. from the rate of Rs.126.00, which has been quoted by herself. As rightly stated that the Department has not fixed the rate of Rs.126.00 per M.T., arbitrarily as alleged by the respondent. I have already extracted the various tender conditions and it is a open tender. It is also clear that after inspection and after satisfying herself she quoted the rate, hence I am of the view that she cannot ask for direction for reduction of the rate based on the rates prevailing on other salt lessees. 10. I have already extracted the various tender conditions and it is a open tender. It is also clear that after inspection and after satisfying herself she quoted the rate, hence I am of the view that she cannot ask for direction for reduction of the rate based on the rates prevailing on other salt lessees. 10. Mr.V.T.Gopalan, learned Additional Solicitor General in the light of the above factual position has very much relied on the following decisions of the Supreme Court reported in. (1) Har Sankar v. Deputy Excise & Taxation Commissioner, A.I.R. 1975 S.C. 1121; (2) Raunaq International Ltd., v. I.V.R. Construction Ltd., (1999)1 S.C.C. 492 ; and (3) Assistant Excise Commissioner v. Isaac Peter, (1994)4 S.C.C. 104 . 11. In the first decision, viz., in Har Sankar’s case, A.I.R. 1975 S.C. 1121 in respect of claim made by liquor contractors and hoteliers challenging the demands made upon them by the department of Excise and Revenue, Government of Punjab. Their Lordships have held; 16. Those interested in running the country liquor vends offered their bids voluntarily in the auctions held for granting licences for the sale of country liquor. The terms and conditions of auctions were announced before the auctions were held and the bidders participated in the auctions without a demur and with full knowledge of the commitments which the bids involved. The announcement of conditions governing the auctions were in the nature of an invitation to an offer to those who were interested in the sale of country liquor. The bids given in the auctions were offers made by prospective vendors to the Government. The Government’s acceptance of those bids was the acceptance of willing offers made to it. On such acceptance, the contract between the bidders and the Government became concluded and a binding agreement came into existence between them. The successful bidders were then granted licences evidencing the terms of contract between them and the Government, under which they became entitled to sell liquor. The licensees exploited the respective licences for a portion of the period of their currency, presumably in expectation of a profit. Commercial considerations may have revealed an error of judgment in the initial assessment of profitability of the adventure but that is a normal incident of all trading transactions. Those who contract with open eyes must accept the burdens of the contract along with its benefits....." 12. Commercial considerations may have revealed an error of judgment in the initial assessment of profitability of the adventure but that is a normal incident of all trading transactions. Those who contract with open eyes must accept the burdens of the contract along with its benefits....." 12. By pointing out the second decision, viz., Raunaq International Ltd., v. I.V.R. Construction Ltd., (1999)1 S.C.C. 492 learned Additional Solicitor General would contend that the Court below committed an error in granting injunction without considering the loss to be suffered by the Department. In this regard, the following observation made by their Lordships are relevant: ”18. The same considerations must weigh with the Court when interim orders are passed in such petitions. The party at whose instance interim orders are obtained has to be made accountable for the consequences of the interim order. The interim order could delay the project, jettison finely worked financial arrangements and escalate costs, hence the petitioner asking for interim orders in appropriate cases should be asked to provide security for any increase in cost as a result of such delay or any damages suffered by the opposite party in consequence of an interim order. Otherwise public detriment may outweigh public benefit in granting such interim orders. Stay order or injunction order, if issued, must be moulded to provide for restitution." It is clear that even though the Courts below have granted injunction as claimed by the respondent herein, admittedly they failed to take note of the injury or loss to be suffered by the Department. Without considering the case of the Department and providing necessary safeguards in the event of the dismissal of the suit, the orders passed by the Courts below cannot be sustained. 13. In the third case viz., Assistant Excise Commissioner v. Isaac Peter, (1994)4 S.C.C. 104 , in a matter like this viz., after knowing the tender conditions and after quoting the rate, the offerer cannot be allowed to wriggle out of the contractual obligations. In that decision the following observation of their Lordships is relevant. "23. Maybe these are cases where the licensees took a calculated risk. Maybe they were not wise in offering their bids. But in law there is no basis upon which they can be relieved of the obligations undertaken by them under the contract. In that decision the following observation of their Lordships is relevant. "23. Maybe these are cases where the licensees took a calculated risk. Maybe they were not wise in offering their bids. But in law there is no basis upon which they can be relieved of the obligations undertaken by them under the contract. It is well known that in such contracts - which may be called executory contracts - there is always an element of risk. Many an unexpected development may occur which may either cause loss to the contractor or result in large profit. Take the very case of arrack contractors. In one year, there may be abundance of supplies accompanied by good crops induced by favourable weather conditions; the contractor will make substantial profits during the year. In another year, the conditions may be unfavourable and supplies scarce. He may incur loss. Such contracts do not imply a warranty or a guarantee of profit to the contractor. It is a business for him profit and loss being normal incidents of a business. There is no room for invoking the doctrine of unjust enrichment in such a situation. The said doctrine has never been invoked in such business transactions. The remedy provided by Article 226, or for that matter, suits , cannot be resorted to wriggle out of the contractual obligations entered into by the licensees." 14. Mr. Mohan Parasaran, learned counsel appearing for the respondent by relying upon the following decisions viz., (1) Tata Cellular v. Union of India, (1994)6 S.C.C. 651 ; (2) Ramana v. I.A. Authority of India, A.I.R. 1979 S.C. 1628; (3) Shrilekha Vidyarthi v. State of U.P., A.I.R. 1991 S.C. 537 and (4) The Division Bench decision of this Court reported in M/s. Chokhani International Ltd. v. Board of Trustees of the Port of Madras, 1987 W.L.R. 529, would contend that, in the light of the fact that at the time of making offer there were encroachments in the lands in question and similar lands were offered to other persons at a low rate, the impugned contract is in violation of Art.14, hence the Courts below are justified in granting injunction. It is clear from the above decisions that the principle of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favoritism. It is clear from the above decisions that the principle of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favoritism. However there are inherent limitations in exercise of such power by 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 Government. But the principles laid down in Art.14 of the Constitution have to kept in view while accepting or refusing a tender. There can be no question of infringement of Art.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. However if the said power is exercised for any collateral purpose the exercise of that power will be struck down. 15. I have already mentioned that the petitioner after taking the representatives of the respondent herein and after spending Rs.40,000.00 removed the encroachments with the assistance of the Revenue Authorities. Regarding the grant of lease at a low rate in favour of M/s.SPIC and Priyadarshini Salt Works, the Deputy Salt Commissioner has explained the reasons for the same. All those things have to be considered on the full fledged trial. If ultimately the respondent / plaintiff is able to succeed in the suit, it will not be any difficult for her to get back her amount. 16. In the light of the factual position viz., specific tender conditions, letter of the respondent herein agreeing to abide by the terms and conditions, acceptance of her offer, no reference in the impugned orders with regard to delay and the ultimate loss if any to the Department etc., I am satisfied that the orders of both the Courts below are vitiated and liable to be set aside. I am also satisfied that while passing the injunction order in favour of the respondent herein, the Courts below failed to protect the interest of the Government. 17. In the light of what is stated above, I am of the view that the trial Court has committed an error in granting injunction in favour of the respondent herein and equally the lower appellate Court erred in dismissing the appeal filed by the petitioner. 17. In the light of what is stated above, I am of the view that the trial Court has committed an error in granting injunction in favour of the respondent herein and equally the lower appellate Court erred in dismissing the appeal filed by the petitioner. I am also satisfied that both the Courts below failed to consider the point that the respondent has violated the terms and conditions of the lease order and notice of inviting tender. Accordingly the order of the District Munsif, Ponneri dated 30.4.1997 passed in I.A.No.351 of 1997 in O.S.No.87 of 1997 as well as the confirmation order passed by the learned Subordinate Judge in C.M.A.No.20 of 1998 dated 30.4.1999 are set aside and civil revision petition is allowed. No costs. It is made clear that the observation and ultimate conclusion made are only for the disposal of the injunction application. 18. In view of the disposal of the main revision connected C.M.Ps., are closed.