Judgment Ravi S.Dhavan, J. 1. Delay condoned. 2. This letters patent appeal has been filed ostensibly on behalf of the State of Bihar. The court mentions ostensibly because this aspect may ultimately have a bearing on some other circumstances which ought not to have been raised by the appellants. The issues are to be seen as arising out of the judgment which is challenged in this letters patent appeal. The judgment is dated 14 January 2004. It was rendered on a writ petition being CWJC No. 13914 of 2003: P.E.C. Limited vs. State of Bihar & Ors. 3. Another circumstance emerged subsequently in the appeal. It is contended in this appeal that the State of Bihar was not aware as to the identity of the highest bidder, the petitioner, which filed the writ petition. This party is known as P.E.C. Ltd., (Project and Equipments Corporation Limited); a Government of India undertaking. The issues, then, are with a public sector undertaking, a state in its own right. Its shares are held by the President of India. This was not an issue in the writ petition. 4. Issues prior to the filing of the writ petition, which led to the filing of it are about the assignment of a contract to a highest bidder in a public auction. A contract was to be awarded by the State of Bihar by a public auction. An advertisement was caused to be made by the State of Bihar as a public notice. The advertisement was published on 16 September 2003 bearing no. YA-2-PRA-17/2002. It was published by the Chief Engineer, Mechanical, Water Resources Department, Bihar, Patna. It was announcing an auction (Neelam Soochna) and the conditions were given in it. Fourteen conditions were provided. 5. The date of auction set was for 23 September 2003. The subject of the contract related to four (4) lots; A, B, C & D. The goods were iron and steel scrap. It was a sale of goods by description, not by sample. The goods were to be sold by tonnage, that is, weight. 6. The issue which concerns the matter before the court in the letters patent appeal as also in the writ petition related to the four (4) lots, that is, A, B, C & D. 7. First, the parameters of a public, auction are to be understood. Then the law which governs a public auction. 8. 6. The issue which concerns the matter before the court in the letters patent appeal as also in the writ petition related to the four (4) lots, that is, A, B, C & D. 7. First, the parameters of a public, auction are to be understood. Then the law which governs a public auction. 8. The first aspect is about the modality of a public auction. An advertisement was not an offer. It was an invitation to make an offer. This 1s the law. An advertisement was an invitation to make an offer; to enter an arena of public auction. One needed a passport in the nature of a deposit as earnest money. This was condition no. 1. The earnest money was to represent 5% of the reserved price. Any one who did not deposit the earnest money could not enter the arena where the auction was to be held. P.E.C. Ltd., a party which filed the writ petition, had deposited the earnest money, it crossed the barrier to enter the arena of auction. The place of auction was at Bhimnagar, district Birpur (Supaul). The second condition of the auction was that the bids were to be offered per ton of the goods, that is, metal scrap. By the third condition inspection of the goods was permitted. By the fourth condition 10% of the highest accepted bid amount, in addition to the earnest money, would be deposited within 7 days and this was to be as National Saving Certificates or Bank Drafts. The additional condition was that if, upon acceptance of the auction bid, a National Saving Certificate or a Bank Draft amounting to 10% of the accepted bid amount was not deposited within the period stipulated then the earnest money could be encashed, in effect, forfeited. The fifth condition was that unsuccessful bidders would be refunded their 5% earnest money within one week from the date of the auction. The sixth condition was that if for any reason the auction bid is not accepted within the period indicated then both the earnest money and the 10% security so deposited by the highest bidder would be returned within one week of the date of rejection of the contract. The sixth condition was that if for any reason the auction bid is not accepted within the period indicated then both the earnest money and the 10% security so deposited by the highest bidder would be returned within one week of the date of rejection of the contract. The seventh condition was that the highest bidder upon accepting the bid was to deposit the 90% of the total accepted bid amount through treasury challan, otherwise 5% earnest money and 10% deposited amount was liable to be forfeited. The eighth condition was a post contract condition on the responsibility of the safe conditions of the goods and the removal of the goods within 45 days and the earnest money of 5% would be returned only, thereafter, and if the goods are not removed then the highest auction bidder will pay rent @ Rs.100/-per lot per day. The rest conditions between 9 and 14 are consequential to the contract having been accepted, for instance the payment of sales tax and incidental matters. 9. The facts as are noticed and on the basis of which the writ petition was allowed should be best reiterated as they lie on record. These are: "In short, the relevant facts are that pursuant to the auction notice, contained in Annexure-2, three persons including the petitioner participated in the auction for the purchase of scraps and undisputedly his bid was highest. After completion of the bid, bid was accepted and the bid-sheet was signed by the Sub-division Officer, Birpur Sub-division, Chief Engineer, Superintending Engineer and the Executive Engineer of Water Resources Department. The acceptance of the bid was communicated to the petitioner vide Executive Engineer (Mechanicals letter, contained in Annexure 5 series. However, later bid itself was cancelled by the impugned orders, contained in Annexures 18 and 19 without assigning any reason and directing for holding fresh auction. In the counter affidavit filed on behalf of the Respondents it is admitted that the petitioner was highest bidder in all the four lots and Sikkim Ispat Udyog was the 2nd lowest in both lots A and D. It has been accepted that the petitioner was asked to deposit 10% security deposit of total auction amount in the shape of Bank Draft as fixed for each lot, which they deposited on 30.9.2003. It is further stated that lotwise proposal was sent to the Chief Engineer (Mechanical), Patna along with photocopies of bid register for approval of bids in favour of highest bidder. Thereafter, some complaints were received in the Department that some antisocial elements threatened some bidders before auction and free and fair auction was affected and the complainants are ready to receive the bid on 20% higher rate." 10. There are no issues between the parties thus far. The party which was the highest bidder had deposited the earnest money to enter the scene of the auction. The petitioner, P.E.C. Ltd., was the highest bidder. It had made due deposit after it had been indicated in writing that the contract had been accepted. There were four lots on which the highest bid of the petitioner had been accepted. Four letters of acceptance of the contracts were issued to them. These are letters dated 23 September 2003. These are appended as annexures 5A, 5B, 5C & 5D of the writ petition. One such similar letter in acknowledgement of acceptance of the highest bid and award of the contract is reproduced: Local Langunge (An extract from annexure-5A of the writ petition, as an example). 11 In pursuance of the acceptance of the highest bid the petitioner was required to deposit Bank Drafts against the amounts mentioned as the acceptance of the contract, in writing. The amounts represented 10% of the value of the goods for sale representing the four respective lots. After the auction bid had been accepted, the highest bidder was required to deposit bank drafts amounting to Rs. 16,55,100.00. This represented the 10% of the value of the goods. 12. Not to be ignored is a very relevant aspect that after the deposit representing 10% of the accepted auction bid had been made within one week, the petitioner also received a receipt as acknowledgement of the monies on 30 September 2003, dated the same day, and this is appended as annexure-6. This is receipt No. 148281. This aspect is very important as it will go to the root of the matter. The rejection of the contract could be intimated but within one week. Instead, the State accepted the highest bid and indicated in writing that the amount be deposited, which was done. This amount representing 10% of security was liable to be forfeited. This aspect is very important as it will go to the root of the matter. The rejection of the contract could be intimated but within one week. Instead, the State accepted the highest bid and indicated in writing that the amount be deposited, which was done. This amount representing 10% of security was liable to be forfeited. Far from rejecting the contract which could only be done within 7 days of the date of the auction, even a receipt was issued against the acceptance of the amount representing 10% of the value of the contract. Part consideration representing the contract as indicated and stipulated by the seller (vendor) of goods had been demanded, paid and accepted. Thus, the contract was complete. 13. These aspects are borne out from the record. Contracts are spelled out from the record. In case one condition is missing then it is attributed as a default of the purchasers, the vendee. In a contract which has to be awarded by a public auction and has modalities of deposit of earnest money, security and conversion of it as a part consideration, the conditions as are given out for conducting the auction become very important. The rules of the game are to be followed strictly. The only condition which has to be taken into account is that the State or the Union of India or any other agency which awards a public contract must not suffer a loss. The reserved price should be met. The endeavour should be that the reserved price should be crossed. Once that is done, the highest bidder should be acknowledged. In the present case, he was also required to do and take further steps in furtherance of maturing the contract which he did. 14. Not only that the other significant aspect, though not relevant, is that in an attempt to disturb a settled contract for whatever reasons, the government department even tested itself by announcing another auction sale on 24 November 2003 in a futile attempt to cancel the earlier auction which was held in pursuance of the advertisement dated 16 September, 2003. What was the result? No one came to participate in the auction. In fact, the circumstances were even worse. What was the result? No one came to participate in the auction. In fact, the circumstances were even worse. No one even came forward to pick up the tender so as to deposit the earnest money as a prelude to an auction which was attempted to be held on 10 January 2004. This shows that the government even made an attempt to secure further and more money beyond the contract which was accepted and settled in favour of P.E.C. Limited, otherwise a Government of India public sector undertaking. 15. The modalities of a public auction for selling goods is a contract all right. But the mechanics of an award of such contract are not to be found in the Indian Contract Act, 1872 (Act 9 of 1872). It appears that the age old law which provides for the sale of goods is being forgotten. In the transition after independence a mercantile economy structured by the British was being phased out with a mixed economy. The public sector moving in within a controlled economy where the means of production, sale and distribution of controlled goods were the subject matter of state controlled auctions. Issues on a breach of a contract by the State or a public sector undertaking which partook the nature of State, became issues more in the High Courts writ jurisdiction than before the civil courts. One rarely finds matters of contract arising out of civil courts which need the fineness of interpretation under the law of contracts or the law which governs the sale of goods. These are Law of Contract Act, 1972, and the Sale of Goods Act, 1930. These statutes govern commercial transactions. But the approach in recent times to open the economy and interface it with a free market economy, the rules of an award of contract or consequential matters or their breach, will have to be reexamined within the fineness of the prescription of the statutes; the two mentioned above. 16. Matters of public auctions have been prescribed specifically by the Sale of Goods Act, 1930. In recent times the resort to referring to the Sale of Goods Act, 1930 or the provisions which govern an auction sale have not been resorted to particularly by the State or State agencies involved in conducting a contract by auction. 16. Matters of public auctions have been prescribed specifically by the Sale of Goods Act, 1930. In recent times the resort to referring to the Sale of Goods Act, 1930 or the provisions which govern an auction sale have not been resorted to particularly by the State or State agencies involved in conducting a contract by auction. In the award of public contracts, so much is asserted on the power of the State that those who are to conduct public auctions consider the grant of contracts arising out of auctions as misplaced modalities evolved beyond the published conditions. Departmental power or government power is so easily resorted to rather than observing the nicities of the rules which have been given under the law. 17. Auction sale is a subject matter under the Sale of Goods Act, 1930. "Auction Sale" has been referred in Section 64. This is relevant for the purpose of the present case. Departmental power or government power is so easily resorted to rather than observing the nicities of the rules which have been given under the law. 17. Auction sale is a subject matter under the Sale of Goods Act, 1930. "Auction Sale" has been referred in Section 64. This is relevant for the purpose of the present case. Section 64 is reproduced: "Auction Sale.In the case of sale by auction (1) where goods are put up for sale in lots, each lot is prima facie deemed to be the subject of a separate contract of sale; (2) the sale is complete when the auctioneer announces its completion by the fall of the hammer or in other customary manner; and, until such announcement is made, any bidder may retract his bid; (3) a right to bid may be reserved expressly by or on behalf of the seller and, where such right is expressly so reserved, but not otherwise, the seller or any one person on his behalf may, subject to the provisions hereinafter contained, bid at the auction; (4) where the sale is not notified to be subject to a right to bid on behalf of the seller, it shall not be lawful for the seller to bid himself or to employ any person to bid at such sale, or for the auctioneer knowingly to take any bid from the seller or any such person; and any sale contravening this rule may be treated as fraudulent by the buyer; (5) the sale may be notified to be subject to a reserved or upset price; (6) if the seller makes use of pretended bidding to raise the price, the sale is voidable at the option of the buyer." Now what has been prescribed under the law in Section 64 in the context of the present case maybe seen. 18 In the present case there was a public advertisement which announced that certain goods will be put for sale. The goods were ascertainable and described. It was a sale by description and not by sample. The goods were auctioned in lots and each lot was a separate contract of sale. All this is provided in sub-clause (1) of Section 64. 19. What Section 64 has provided is a step by step modality which governs a sale by auction. These steps govern those who will participate in the auction. The goods were auctioned in lots and each lot was a separate contract of sale. All this is provided in sub-clause (1) of Section 64. 19. What Section 64 has provided is a step by step modality which governs a sale by auction. These steps govern those who will participate in the auction. After all, what is the position of an advertisement which invites purchasers to a public auction. The advertisement partakes the nature of an invitation to make an offer. As long as the hammer does not fall down at the highest bid, the bidder may retract his offer. The law permits him to do so, this is mentioned in sub-clause (2) of Section 64. Then, the right to bid if it is secured and reserved expressly on behalf of the seller, the seller or may any one person on his behalf subject to the provisions of the section bid at the auction himself if he has reserved this right. This is given in subclause (3) of Section 64. This aspect is not a condition of the contract in the present case. If the seller has not notified his right to bid or have a bidding made on his behalf, it shall not be lawful for the seller to bid himself or to permit it on his behalf or for the auctioneer knowingly to take any bid from the seller or any such person and any sale contravening this rule may be treated as fraudulent by the buyer. This is prescribed in sub-clause (4). No bid was reserved in such a manner to the seller in the conditions of auction so that the seller or any person on his behalf may out bid the bidder. 20. A sale by auction must be notified as subject to a reserved or an upset price. In the present case sub clause (5) of Section 64 comes into play. It says, "the sale may be notified to be subject to a reserved or upset price". In the case before the Court a reserved price had been indicated. An upset price was not the condition of the contract. 21. A pretended bidding at the time of sale to raise the price is not permitted. If it happens the sale is voidable at the option of the buyer. This is given in subclause (6). This is not relevant for this case. 22. An upset price was not the condition of the contract. 21. A pretended bidding at the time of sale to raise the price is not permitted. If it happens the sale is voidable at the option of the buyer. This is given in subclause (6). This is not relevant for this case. 22. In the present case, the bid price had been accepted on the date when bidding was made and the acceptance was in writing on 23 September. 2003, the date of auction itself. The acceptance was furthered by the delivery of the receipt of the bank draft and the amount under the bank draft on 30 September. 2003. Seven days time was permitted under the conditions of the contract to the State of Bihar to reject the contract. It never did so. Instead it took steps (a) accepted the bid and (b) gave formal receipt of acceptance of the amount against the bid. 23. Not to be forgotten is the aspect that the consideration of the acceptance of the highest bid, after it crossed the reserved price was the subject matter of Committee of five persons already constituted. This Committee of five persons were: (1) Executive Engineer, Irrigation Sub-division no. 2, Birpur, (2) Superintending Engineer (Tech.), Circle, Birpur, (3), (4) Executive Engineer (Tech.), Purnea, Sub-divisional Officer, Birpur Sub-division, Birpur and (5) Chief Engineer (Tech.), Water Resources Department, Patna. The proceedings of the auction record the bid given in four lots by the respondent petitioner P.E.C. Limited and its acceptance and signed by five officials. The record stands thus: Local Langunge 24. It was in pursuance of this acknowledgement of the highest bid received, which crossed the reserve price, that the petitioner respondent was informed of the acceptance of the contract on 23 September, 2003. In pursuance of the part consideration which was deposited and the receipt issued within seven days that is 30 September, 2003, the contract was formalised and complete. Looked at another way instead of rejecting the offer which could be done within seven days, instead, a part consideration was accepted and a receipt issued against it. In so far as the law is concerned, there is nothing more the purchaser had to do and, he did all that was possible under the law. Looked at another way instead of rejecting the offer which could be done within seven days, instead, a part consideration was accepted and a receipt issued against it. In so far as the law is concerned, there is nothing more the purchaser had to do and, he did all that was possible under the law. In so far as the seller is concerned, he acted strictly in accordance with the terms of the auction, and part consideration was received. The acceptance was communicated. Time was the essence of the Contract to reject it. It was not rejected within the time allotted. At the expense of repetition the contract was complete when it was accepted. The record is so certified on the certiorari which was sought. The cancellation was rightly quashed by the learned Judge. 25. This should have been the end of the issues. 26. The second aspect is not relevant to the legalities by which the contract stands granted. Non-performance by the State of Bihar would be a breach. 27. But as this aspect is a subject matter of record and was pleaded as a defence in the writ petition it is being noticed. At the out set, it maybe placed on record that the attempt to dislodge the contract was the result of misplaced politics. First the facts. On 7 October, 2003 a Member of the Legislative Assembly, Mr. Sarfaraz Ahmad, wrote to the Cabinet Minister Mr. Jagdanand Singh-holding the portfolio of Water Resources Department. The Letter of the Member of the Legislative Assembly reads: Local Langunge On this the Hon ble Minister made a hand written endorsement. It records: Local Langunge 28. The member of the Legislative Assembly who wrote the letter was himself an Ex-Member of the Cabinet at one stage. His father is a sitting member of the Cabinet Mr. Taslimuddin. He holds the portfolio of Public Works Department, Buildings. In the circumstances two sitting Ministers and one Ex-Minister and a member of the Legislative Assembly attempted to dislodge the contract. The foundation which was laid was that twenty lacs more could be received. But, out bidding was not a condition of the contract. In the circumstances, the exercise which was attempted to dislodge the contract was patently irregular, if not illegal. The State has not suffered a loss. The foundation which was laid was that twenty lacs more could be received. But, out bidding was not a condition of the contract. In the circumstances, the exercise which was attempted to dislodge the contract was patently irregular, if not illegal. The State has not suffered a loss. May be between two sitting Ministers and a member of the Legislative Assembly they were under the impression that this contract should be frustrated. The Court would not know whether this is the contract Mafia which operates or if there was a genuine concern that the State should get more money. But. this sort of exercise brings a bad name to Bihar. No businessmen or industrialist will set foot in Bihar if a message goes to the outside world that in the award of a state contract, notwithstanding the rules of the game and conditions indicated in a public advertisement, there may yet be another game and interference at the political level. Trade and industry function where there is stability and confidence, where the State like a prudent business man keeps its commitment and word of honour to abide by all the conditions already given for a contract. 29. The noting of the Minister may be taken to be as normal. It may be assumed in the functioning of politics that if a sitting member of the Legislative Assembly will write to a Minister, the Minister cannot ignore the complaint of a member of the Legislative Assembly and that he will in acknowledgement of the complaint, require the Secretary to put up a note, There is nothing wrong in this. But, here lies a more heavy burden on the Secretary to the Government. If a note has to be put up then it must be a note which takes into consideration the facts as have taken place so that the Minister, as public accountability and collective answerability of the Cabinet to the Legislature, can makeup his mind so that his decision stands up to public scrutiny under the law. The facts and the law which governs public auctions are not referred to in the Secretarys note. 30. The third aspect: These were aspects which were neither facts nor circumstances nor on record of the writ petition. The facts and the law which governs public auctions are not referred to in the Secretarys note. 30. The third aspect: These were aspects which were neither facts nor circumstances nor on record of the writ petition. These circumstances were attempted to be made an issue in the letters patent appeal and much vehemence was placed on behalf of the appellants that the court should notice the circumstances. This gave rise to a doubt in the mind of the court as to why these circumstances, not on record and not existing when the writ petition was decided, are being submitted before the court in this appeal. The State Counsel who was designated to handle the case, that is, the designated gazetted scheduled counsel was dumped out of the case. A special engagement was made by the State of Bihar to present the letters patent appeal (L.P.A. No. 368/2004). Like any citizen even the State is at liberty to keep its style in administration but dumping a State Counsel unless he has done some wrong does give rise to the presumption that the State Counsel may have declined to plead something which was being suggested to him. Casting out a State Counsel who is designated to do a case is an abnormal situation. However, what were the circumstances on which it was being pressed heaviiy that the court should notice it and pass such an order that it affects the result of the public auction? 31. A doubt was being created that the identity of the person who made the bid was suspect. Was it so? The person who made the bid was acting as an agent of the P.E.C. Limited, a public sector undertaking. This is provided in Chapter X of the Indian Contract Act, 1872. The entire auction rested on the highest bid on behalf of the P.E.C. Limited. The bids were made by the agent of the P.E.C. Limited. The agent was under a duty to conduct the principals business (Section 211). At no stage on record or otherwise was the agents authority terminated. An attempt was made to create circumstances in the letters patent appeal that the person who calls himself Naushad was, perhaps, a Maushad. A case was being made out during the pendency of the appeal that the agent was a fraud. The best answer could be given by the principal. An attempt was made to create circumstances in the letters patent appeal that the person who calls himself Naushad was, perhaps, a Maushad. A case was being made out during the pendency of the appeal that the agent was a fraud. The best answer could be given by the principal. The State of Bihar accepted the earnest money of the agent. It was deposted on behalf of the P.E.C. Limited, the principal. The State of Bihar permitted the bids to be made by the agent. They were made on behalf of the principal P.E.C. Limited. The State of Bihar required the agent to be obliged to, in further of the award of the contract, deposit 10% security as consideration. This the agent did on behalf of the P.E.C. Limited. There was no doubt on the functioning of the agent when all this was being done. 32. Because there was political interference, the court is being required to go into it by insistence of the Special Counsel. The State Counsel took a ring side seat. The Court indicated that these circumstances being presented by insistence were not relevant as these were not facts in the petition, nor issues when the cause of action was filed as a writ petition. Special Counsel engaged insisted that the Court is obliged to notice his submissions. So be it. Counsel for the respondent-petitioner objected to the introduction of alien facts to prejudice his case and the court. However, it is best to notice with one word of guidance to the Court itself. It is settled law that the cause has to be seen and decided as it was brought unless there is change in the law itself ( AIR 1976 SC 49 ). The Supreme Court said that the court should be cautious not to permit a fresh fact on a routine. It should refuse where a party is doing so to delay the proceedings, harass the other party or doing so for any other ulterior motive [ (2001)2 SCC 762 ]. Clearly the facts are to be seen in the present case as it was filed as a writ petition. 33. A correspondence was being entered by the Secretary of the State government to write to the principal, P.E.C, Ltd. (respondent-petitioner) whether the agent Naushad or Maushad was authorized to participate in the auction. Clearly the facts are to be seen in the present case as it was filed as a writ petition. 33. A correspondence was being entered by the Secretary of the State government to write to the principal, P.E.C, Ltd. (respondent-petitioner) whether the agent Naushad or Maushad was authorized to participate in the auction. Not only this, a First Information Report was lodged that the person who had made the bid at the auction, Naushad or Maushad was an imposter. The court required the Law Secretary to enquire into this matter and submit a report. The court also desired that P.E.C. Limited (the respondent-petitioner), the principal, to submit the original record. Fortunately, the P.E.C. Limited made a appearance in the case through Mr. Sidheshwar Pd. Singh, Sr. Advocate, assisted by Mr. Ashok Kumar, Advocate. 34. The Law Secretary, Government of Bihar, filed a report. First, what did the principal (P.E.C. Limited), a party in this case, say on the issue which was attempted to be raised that the identity of his agent was in doubt. P.E.C. Limited filed its record before the court. Further, it caused a statement to be made through its counsel that there is no doubt at all that in the participation of the contract, it (P.E.C. Limited) had authorised Naushad to make a bid at the auction. Maushsd may have been a typographical error somewhere on the record, it was submitted, but Maushad and Naushad are one and the same person and the bids as were made were correct and authorised by the principal (P.E.C. Limited), with instructions given to the agent to make the bids, deposit the earnest money and the security which were authorised and done. This, then, ended the issue which was attempted to be made on behalf of the State of Bihar. This is very unfortunate. 35. Then, the Law Secretary filed a report that there is no issue on the name Naushad or Maushad. The reference to Maushad is a typing error. For the State of Bihar Naushad and Maushad are one and the same person and it was Naushad who as an agent of the P.E.C. Limited was permitted by the State of Bihar and did participate in the auction. The reference to Maushad is a typing error. For the State of Bihar Naushad and Maushad are one and the same person and it was Naushad who as an agent of the P.E.C. Limited was permitted by the State of Bihar and did participate in the auction. The report of the Law Secretary is reproduced: "After perusal of the official records concerning the above mentioned L.P.A. and the C.W.J.C. 13914 of 2003 produced before me by the Secretary, Water Resource Department, Government of Bihar, Patna, on 24.4.04, I beg to submit a report as follows: (1) That the Principal (bidder) P.E.C. a Government of India undertaking seeking the contracts in Water Resources Department, Government of Bihar acted through the agent throughout to the extent of transfer of the property to the third party. The Principal did not revoke the authority which it gave to the agent and acts through the said agent even today. 2. That the agent is he who applied to participate in the bid, deposited the earnest money, participated in the bid and deposited security money in the form of Kisan Vikas Patra. The controversy over Nausad and Mausad appear to be a pure typographical error and as such the plea and controversy created over the name Nausad and Mausad appear fishy and flimsy and so also the plea of his character has nothing to do with the contract in question. It may be a matter between the principal and the agent with which the department or the Government has nothing to do. 3. That it appears that the principal was dealing with the same agent throughout and even the State of Bihar interacted with the same agent. Now in the appeal no controversy regarding the name of Nausad or Mausad cannot (siccan?) be raised legally. I may mention that there appear no fraud and a fresh plea of fraud cannot legally be raised in or during the appeal. 4. That it is relevant to mention here that no document in its support can legally be created by any party during the pendency of an appeal and as such lodging FIR or creating any other document during the pendency of the appeal may amount to interference with the administrative of justice. 4. That it is relevant to mention here that no document in its support can legally be created by any party during the pendency of an appeal and as such lodging FIR or creating any other document during the pendency of the appeal may amount to interference with the administrative of justice. The side issues of no consequences raised or presented during the argument in appeal is of no relevance and that may simply make the simple issue clumsy. The argument in the appeal should have been confined only to the point as to whether the order as passed in the C.W.J.C. is fit to be upheld or not. 5. That the Law Secretary-cum-Legal Remembrancer was not consulted in this case by the Government before filing L.P.A. or in making appointment of a private lawyer in the appeal when the panel of able State counsel is available. I may mention that according to the letter bearing No. 3897 dated the 16th August, 1994 issued from the Cabinet Secretariat the lawyers from the panel only be appointed in cases relating to the Government and its officers. 6. That the contract to the principal was under the sovereign authority of the State of Bihar and the Principal is a body of Government of India undertaking. Any obstructions towards the working in implementation of the contract will send a bad message on the reputation of the State of Bihar as the message would be that the rights under the contract is being infringed at the Ministerial level which in all circumstances has to be prevented." 36. After the statement of the counsel for P.E.C. Limited on instructions and the report of the Law Secretary, the filing of the First Information Report was not only misplaced, but a misuse of State power to deprive the liberty of a citizen. An ordinary person will not take such steps when issues are subjudice. Further, inviting persons to participate in a bidding of a State contract and then harassing them by filing an incorrect first information report with intent to cause the police or a police official as a public servant to use his lawful power to the favour of any person is a false First Information Report. Further, inviting persons to participate in a bidding of a State contract and then harassing them by filing an incorrect first information report with intent to cause the police or a police official as a public servant to use his lawful power to the favour of any person is a false First Information Report. It is unfortunate that a First Information Report has been filed on the basis of a correspondence which was entered by a Secretary to the State government with the P.E.C. Limited. The P.E.C. Limited, the principal, placed its record before the High Court to show that a letter was being solicited on behalf of the Secretary to the State government, on which its officer wrote on the file "not to be issued". Subsequently, the P.E.C. Limited made a statement that there is no impersonation; that Naushad is its agent and the M instead of N was a typing error. The Law Secretary certified that this matter of a typing error to describe Naushad as (M) aushad was a game which was played too far. 37. What steps the party who has been harmed in facing the First Information Report may take, he is free to take as advised. The party will be entitled to complain to the Magistrate that an allegation was made fortified by a First Information Report and it partakes the nature of an offence under section 182 of the Indian Penal Code. 38. In so far as the classification of offence is concerned, the Imprisonment is for six months or fine or both. The offence is non-cognizable though bailable. It is triable by a Magistrate. The offence is non-compoundable. In addition, the agent or the principal will be entitled to a civil action to claim such damages as they may be advised at a place of their choosing. All these aspects are matters which were generated for the record to manufacture a plea to prejudice the court. An attempt was made to dislodge the contract. In so far as the contract is concerned, it is certified that it holds. Both the principal and the agent will be entitled to the remedy of specific performance of the contract, a remedy it has under the law. 39. All these circumstances created in the appeal are extraneous and nothing to do with the merit of the case. In so far as the contract is concerned, it is certified that it holds. Both the principal and the agent will be entitled to the remedy of specific performance of the contract, a remedy it has under the law. 39. All these circumstances created in the appeal are extraneous and nothing to do with the merit of the case. Clearly, the cause of action has to be seen as on the date when the case was brought to the High Court, that is, the date of filing of the petition dated 12.12.2003. The fact that the cause of action will be judged as on the day when the cause was brought to the court is the law and it has been settled by the Supreme Court in several cases. This is not a matter of any subsequent event where the law may have changed to affect parties which the court has to take notice of. An overt act whether a complaint by a sitting Member of the Legislative Assembly, otherwise the son of a Cabinet Minister, to a Minister of the Government and the further steps taken by the Secretary to the State government, was not correct for good governance. Interference with matured contracts, clearly bringing profit to the State over the reserve price, is an incorrect and illegal exercise. Besides, even beyond this the purchaser and the bidder is a Government of India, public sector undertaking. 40. The court does not find any error in the order of the learned Judge allowing the writ petition and holding that the contract was complete in the hands of the highest bidder with the requisite earnest money and security in deposit with the State of Bihar. 41. The amounts as security in part consideration received by the State of Bihar subsequently deposited with the Registrar General, Patna High Court (reference orders of the Court dated 12 April 2004) will be returned to the State of Bihar by transfer to the same account at Saharsa from where it came. 42. This appeal is dismissed with costs throughout. Shashank Kr.Singh, J. 43 I agree.