JUDGMENT Singh, J. -- 1. This L.P.A. is directed by the petitioner against the order dated 20.4.2000 passed by writ Court in W.P. No. 789/2000 filed under Article 226/227 of the Constitution of India whereby the petition was dismissed. 2. The facts of the case, in brief, are that on 23.3.2000. Malipura Group of Liquor shops. Ujjain was auctioned for one year for a period from 1.4.2000 to 31.3.2001 by the Collector Ujjain in which the petitioner made bid of Rs. 9.90.00.101/-. This hid was accepted by the Collector and the hid amount being more than 4 crores. therefore, in view of clause 6 of the Tender Notice (Annexure R-1). the matter was sent to the Commissioner Excise. M.P. Gwalior. for his approval and finalisation. On 30.4.2000 the respondent No.4 M/s Shambhu Marketing Ltd. made an application to the Commissioner and offered that if re-auction was held. he was willing to make hid of Rs.10,89,11.000=00 which was more than 10%, of the previous hid amount of Rs. 9,90,00,101/- and enclosed a Banker's cheque of Rs. two crores as earnest money. The Commissioner taking into consideration the offer made by respondent No.4 passed order Annex. P-4 under Clause 17 read with clause 6 of the Tender Notice and cancelled the auction held on 23.3.2000 which was knocked down in favour of the petitioner and ordered for re-auction. The petitioner filed petition under Article 226/227 for quashing the order Annexure P-4 passed by respondent No.2. Commissioner. During the pendency of this petition. fresh auction took place in which respondent No.4 made the highest hid of Rs. 12.82,05.101/- which was 33% more of first auction price (9.90,00.101/-). The State opposed the petition and filed its return. The learned Single Judge of this Court after hearing both parties passed the impugned order and dismissed the writ petition. Hence, this appeal. 3. Shri P.K. Saxena. learned Sr. Counsel for the appellant, submitted that respondent No. 2 Commissioner acted malafidy in cancelling the previous auction without hearing him and ordering re-auction. His contention is that the Commissioner acted mala fide in ordering re-auction on the application of respondent No. 4 as he had not participated in the previous auction and the application was not made within 3 days from the date of auction as provided under clause 12. He submitted that even under clause 17 of the Tender Notice.
His contention is that the Commissioner acted mala fide in ordering re-auction on the application of respondent No. 4 as he had not participated in the previous auction and the application was not made within 3 days from the date of auction as provided under clause 12. He submitted that even under clause 17 of the Tender Notice. order for re-auction cannot be passed unless the conditions enumerated in clause 12 are complied with. On the other hand, Shri D.D. Vyas. learned A.A.G. for the State and Shri S.C. Bagadiya. learned Sr. Counsel for respondent No.4. submitted that the application was made under clause 17 and not under clause 12. Clause 12 and clause 17 are independent and Commissioner has got absolute power under clause 17 not to accept the auction and order for re-auction provided he was satisfied that the bid was inadequate. 4. Clauses 12 and 17 of Excise Auction are reproduced below : "12. Re-auction -- (a) The application for re-auction may he submitted by anyone or more of only those persons who were present at the original auction and was/were not ineligible for or debarred from bidding. Any such person can apply for re-auction of any shop or group of shops, if the shops have been auctioned in a group, in respect of which the final hid was taken by the Collector and the applicant had taken part in the auction/tenders. (b) The application for re-auction shall be submitted to Collector within three days from the date of auction. The General Holidays are to be excluded while counting this period or three days. the applicant has to deposit 1/3rd amount of the highest hid received at the original auction. The amount of earnest money, if any, already deposited by the applicant shall he adjustable towards the 1/3rd amount-aforesaid and the balance shall either he deposited in Government Treasury by Challan or in the form of Bank Draft or Bankers Cheque or Cash-order of a Nationalised Bank of the same amount and such challan, Bank Draft. Bankers Cheque, or Cash-order shall he submitted with the application. (c) Any application for re-auction may he considered only if the applicant is willing to offer a hid which is 10% higher than the highest hid received at the original auction. The date of re-auction shall he notified by the Collector.
Bankers Cheque, or Cash-order shall he submitted with the application. (c) Any application for re-auction may he considered only if the applicant is willing to offer a hid which is 10% higher than the highest hid received at the original auction. The date of re-auction shall he notified by the Collector. If the date of re-auction announced in the auction hall/Pandal by Collector, there will he a gap of 5 days between the Auction and Re-auction. (d) If the applicant does not hid at the Re-auction, the 1/3rd amount deposited by him as aforesaid shall he forfeited. He shall have to clearly state in his application that he undertakes to observe the condition that in case re-auction is held he shall not offer a bid which is less than the proposed amount of hid and if he fails to do so the amount deposited by him shall be forfeited. (e) On receipt of an application for the re-auction of any shop/group of shops, the auction of which was held subject to the sanction of the Excise Commissioner, the Collector shall inform the Excise Commissioner by telegram that the first auction of such shop/group of shops should not he sanctioned and the Collector shall proceed for the re-auction of such shop/group of shops. (f) The application for re-auction of any shop/group of shops shall he entertained only once. (g) Every bidder who had offered the highest hid in the first original auction shall remain bound by his bid for fifteen days even though the shop/shops have been re-auctioned for any reason in this period." Clause-17 of the Auction conditions reads as under: "The Excise Commissioner can order re-auction of any shop or group of Shops in the interest of government revenue even though the bid was finally sanctioned by the Collector or by the Excise Commissioner under Condition No.6". 5. From the perusal of these clauses, it is clear that these clauses are not interdependent, they are independent of each other and cover different situations and different fields. Application for re-auction under clause 12 can be made to Collector only by a bidder who had participated in previous auction and is willing to offer a bid which is 10% higher than the highest bid received at the auction and that too within 3 days from the auction date on depositing 1/3rd of the bid amount.
Application for re-auction under clause 12 can be made to Collector only by a bidder who had participated in previous auction and is willing to offer a bid which is 10% higher than the highest bid received at the auction and that too within 3 days from the auction date on depositing 1/3rd of the bid amount. This clause clothes the Collector with the jurisdiction to order re-auction. The Excise Commissioner in such a case has no role to play. Under clause 17, if the Excise Commissioner is satisfied that the order for re-auction of the shop would be in the interest of Govt. Revenue. he can exercise his powers under this clause and order for re-auction. Under clause 17 Collector has no role to play. The powers of the Excise Commissioner under Clause 17 are un-fettered, if he is satisfied that the bid amount is inadequate he can order re-auction. In our opinion, for exercise of powers under clause 17. compliance of mandatory requirements of clause 12 is not necessary. What is required for exercise of powers under clause 17 is the satisfaction of the Commissioner that re-auction would be in the interest of public Exchequer. 6. In the instant case, the respondent No.4 did not take part in the auction held on 23.3.2000, therefore, he could not make application for re-auction under clause 12, thus the argument that the application was not made within 3 days from the auction date i.e. 23.3.2000 and 1/3rd of the bid amount was not deposited goes away. It is true as stated in the return filed by respondent NO.2 and 3. that respondent No. 4 had deposited entrance fee of Rs. 500/- for participating in the auction and he was issued a gate pass and had deposited earnest money for the auction. But he did not make any bid in the auction therefore. he cannot be held to be a bidder on the basis of his presence at the time of auction without making bid, it cannot he held that he took part in the auction. therefore, the contention put forth by Shri Saxena that respondent No, 4 could make application under clause 12 and he did not comply with the mandatory conditions enumerated in this clause. therefore, no order for re-auction could be given, goes away. 7.
therefore, the contention put forth by Shri Saxena that respondent No, 4 could make application under clause 12 and he did not comply with the mandatory conditions enumerated in this clause. therefore, no order for re-auction could be given, goes away. 7. The argument of Shri Saxena that the Excise Commissioner acted mala fide in directing re-auction, is baseless. There is nothing on record to imagine that the Excise Commissioner acted mala fide. The respondent No.4 had deposited draft of Rs. two crores and had undertaken to offer bid of Rs.10,89,11,000=00. In case he failed to give bid, the earnest money was to be forfeited and State was going to be benefited by two crores of Rs. In our opinion, even a person who had taken part in previous auction can also approach the Commissioner for ordering re-auction under clause 17 by offering more amount than the bid amount and if the Commissioner is satisfied that re-auction will fetch more revenue, he can order for re-auction. The Apex Court in case of Ramana Dayaram Shetty v. The International Airport Authority of India and others. AIR 1979 S.C. 1628 . observed that the object of holding auctions is to raise the highest revenue, the Govt. is entitled to reject the highest bid if it thought that it was inadequate. This Court in M.P.No. 377/97. Nirmal Shivhare v. State of M.P. and others decided on 30.4.97 held: "Powers conferred on the Excise Commissioner under Condition No. 17, should have been exercised by him, in the said case. This condition does not put any reservation or restriction, or mode under which, the same should be exercised. The aforesaid condition cover all types of contingency that may arise in auction. It is not dependant on fulfillment of any condition by the eligible bidders." The jurisdiction of Commissioner can be invoked suo motu or on application of intending bidder or on the report of his department or any material brought before him. Therefore, the exercise of jurisdiction by the Commissioner under clause 17 on the basis of the application of the respondent No.4, cannot be said to be mala fide on any stretch of imagination. Even otherwise, High Court is not a Court of appeal and cannot be called upon to correct a mere technical errors. Their Lordships of the Supreme Court in case of Air India Ltd. v. Cochin International Airport Ltd. and others.
Even otherwise, High Court is not a Court of appeal and cannot be called upon to correct a mere technical errors. Their Lordships of the Supreme Court in case of Air India Ltd. v. Cochin International Airport Ltd. and others. (2000)2 SCC 617 , observed : "Even when some defect is found in the decision making process the Court must exercise its discretionary power under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The Court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the Court should intervene." In the instant case, as stated earlier, the Excise Commissioner on receiving application of respondent No.4 offering bid to the tune of Rs.10,89,11,000/alongwith a draft of Rs. two crores, was satisfied that the bid amount of auction held on 23.3.2000 was inadequate and by re-auction, the bid amount was going to be raised by more than 99 lacs, ordered for re-auction in which respondent No.4 made highest bid of Rs. 12,82.05.101/- which is 33% higher than the first auction amount (9,90,00,101/-). We find no malafide in the order passed by the Commissioner for re-auction. On account of this order public Exchequer was benefitted. The State Govt. received about Rs. 3 crores more. His action deserves to be commended and not criticized. 8. Shri Saxena, learned Sr. Counsel further contended that the Excise Commissioner before ordering re-auction did not give opportunity of hearing to the appellant in whose favour the auction had been knocked down and thereby he violated principles of natural justice. We are not-impressed by this argument. The highest bidder does not obtain any right to the licence by the mere fact that the auction has been knocked, down in his favour as the acceptance is subject to the approval of the Excise Commissioner. The Commissioner has got discretion to accept or not to accept the highest bid. There is also no provision under clause 17 to give notice to the highest bidder before cancelling auction and giving order for re-auction. The Excise Commissioner did not accept the offer of the respondent No.4, he ordered for re-auction which was conducted after due public notice and advertisement.
There is also no provision under clause 17 to give notice to the highest bidder before cancelling auction and giving order for re-auction. The Excise Commissioner did not accept the offer of the respondent No.4, he ordered for re-auction which was conducted after due public notice and advertisement. Therefore, there was no violation of principles of natural justice. It is not the case of the appellant that he did not know that re-auction was ordered. It is true that he did not participate in the re-auction but for this, how the Commissioner can be blamed. The argument of Shri Saxena, learned Sr. counsel that if the appellant would have taken part in the re-auction. this petition would have become infructuous is not acceptable. The writ Court vide order dated 8.4.2000 permitted the appellant to participate in the re-auction. Therefore, no prejudice could be caused to his petition. 9. When this matter was being argued, the learned counsel Shri Saxena stated that the learned single Judge should have asked the appellant whether he was willing and ready to pay the amount offered by respondent No. 4 as the previous auction was knocked down in his favour. The appellant was prepared to pay Rs. 12 crores and 90 lacs and thereby there will be rise of 8 lacs in the State Revenue. He, therefore, prays that this offer be accepted and the auction held in favour of respondent No. 4 be cancelled. This suggestion is not acceptable. The appellant was not prevented from participating in the re-auction. The writ Court had allowed him to take part in re-auction. He could make this bid in the auction. Auction was knocked down in favour of Rep No. 4 it has been accepted and approved by the Excise Commissioner. therefore, right to licence has accrued to him, he has started his business and began to sell liquor. Under such circumstances, the offer of Rs. 12 crores and 90 lacs cannot be accepted. The suggestion that both parties should be asked to offer their bids in the Court and highest bid should be accepted, does not appear to be acceptable. This Court cannot be allowed to become auction-Pandal and what about the rights of the unsuccessful bidder in re-auction. If it is done, there will be no end. The unsuccessful party may go to the Supreme Court and pray for the same. Even the Govt.
This Court cannot be allowed to become auction-Pandal and what about the rights of the unsuccessful bidder in re-auction. If it is done, there will be no end. The unsuccessful party may go to the Supreme Court and pray for the same. Even the Govt. is not bound to accept the highest bid. It is true that the effort of the State is always to procure more revenue while less to the exchequer is a factor which may be taken. into account, in genuine cases the finality of auction must also be recognized to be in the interest of exchequer Even otherwise, State has to function like State. It cannot become trader. (See (1996) 6 SCC. 173 , State of Punjab v. Yoginder Sharma Onkar Rai & Co. and others). It is also pertinent to note that none else participated in the previous auction. The appellant was only in the field, infact it was on horse race. The respondent No. 4 was also present at the time of auction but he did not make any bid. The same thing happened in re-auction, inspite of the fact that the appellant was permitted by the writ Court to lake pan in the re-auction, he decided not to participate in the auction. It shows that the things are not as they appear. 10. in our opinion, the order of re-auction Annex. P-4 does not suffer from perversity unfairness, arbitrariness or mala fide. It is legal. valid and reasonable. In our opinion the learned Single Judge rightly dismissed the petition of the appellant. We find no illegality in the impugned order passed by the writ Court. 11. In the result, the appeal is dismissed. No order as to costs.