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2004 DIGILAW 760 (PAT)

Shankar Prasad v. State Of Bihar

2004-07-29

CHANDRAMAULI KR.PRASAD

body2004
Judgment Chandramauli Kr.Prasad, J. 1. This application has been filed for quashing the order dated 27.10.1999 (Annexure-3) passed by the Mines Commissioner, Department of Mines and Geology, Govt. of Bihar, Patna affirming the order dated 30.4.1999 (Annexure-2) passed by the Collector, Gaya whereby the settlement of Bhusunda Sand Ghat in favour of the petitioner, has been cancelled and the amount deposited by him forfeited. 2. Short facts giving rise to the present application are that a public notice was issued intimating that various Sand Ghats including Bhusunda Ghat shall be settled by public auction. The auction was to be held between 22.12.1998 and 25.12.1998. The notice inviting the persons to participate in the auction for settlement of Sand Ghat laid various terms and conditions. One of the terms and conditions of the settlement was that in case of bid amount exceeding Rs. 50,000/-, 50% of the said amount shall be deposited on the following working day and for the balance amount, a bank guarantee is to be furnished. The notice inviting persons to participate in the auction further provided that in case the lease deed is not executed after complying the terms and conditions, same shall be cancelled. 3. For settlement of Bhusunda Sand Ghat, auction was held on 22.12.1998 and the petitioner offered to take settlement for a sum of Rs. 7,20,000/-. Petitioner deposited the security money as also the half of the bid amount. However, the petitioner did not furnish the bank-guarantee for balance of the bid amount and by registered letter dated 18.10.1999, he was directed to furnish the bank guarantee but the same was not done. Thereafter, a show cause notice was issued to him but the petitioner did not submit any reply and hence, the Collector, by order dated 30.4.1999, cancelled the settlement made in favour of the petitioner and directed for forfeiture of the amount deposited by him. Petitioner aggrieved by the same, preferred revision and by the impugned order, same has been dismissed. 4. Mr. Nand Kishore Prasad Sinha appearing on behalf of the petitioner submits that the petitioner had deposited 10% of the amount as securing money and 50% of the bid amount but the respondents having not given to the petitioner the work order, he did not operate the mines and hence, the action of the respondents in cancelling the settlement and forfeiting the amount deposited by the petitioner, is illegal. He submits that in case, in which the work order is not given for operating the mines, the respondents shall have no authority to forfeit the. amount deposited for settlement. In support of his submission, he has placed reliance on a judgment of the Supreme Court in the case of M/s Jai Durga Finvest Pvt. Ltd. vs. State of Haryana and Ors., AIR 2004 SC 1484 and my attention has been drawn to the following passage from paragraph-11 of the judgment: "11.xxx As the High Court, as noticed hereinbefore, has merely proceeded on the basis that the appellant had entered into the contract with his eyes wide open, but, the same would not, in our opinion, mean that they were bound to pay the contract amount, get its security amount forfeited, as also pay interest at the rate of 24 per cent, although it could not, by reason of acts of omission and commission on the part of the respondents, carry out the mining operation as per the terms of the agreement." 5. I do not have the slightest hesitation in rejecting this submission of Mr. Sinha and the authority relied on, in no way, supports his case. Here in the present case, according to the terms and conditions of settlement, the petitioner was to furnish the bank guarantee for the balance amount after paying 50% of the bid amount on the following day of the auction in case, the bid amount exceeds Rs. 50,000/-. Undisputedly, in the present case, the offer of the petitioner was more than Rs. 50,000/- and to be precise, he offered to take the settlement for a sum of Rs. 7,20,000/-, hence, in terms of the notice, the petitioner was to furnish the bank guarantee for the balance amount which undisputedly, he did not furnish. Further, according to the terms and conditions of settlement, after complying the other terms and conditions, the lease deed was to be executed within sixty days failing which the terms and conditions indicated, that the entire amount deposited shall be forfeited. As the petitioner did not fulfill that conditions, there was no occasion for executing an agreement and consequently, the respondents were not under any obligation to give work-order to the petitioner. 6. As the petitioner did not fulfill that conditions, there was no occasion for executing an agreement and consequently, the respondents were not under any obligation to give work-order to the petitioner. 6. In my opinion, the petitioner did not operate the mines for no fault on part of the respondents but on account of his own omission to furnish the bank guarantee. In a case in which the work order is not given for no fault on part of the petitioner, the order cancelling the settlement or for that matter, forfeiture of the amount deposited, may be illegal in the eye of law but in a case, in which the work order is not given on account of failure on part of the petitioner to fulfil the terms and conditions of settlement, no fault lies with the respondents in not giving the work order and in that case, according to the terms and conditions, the settlement can be cancelled and the amount forfeited. In the present case, this has precisely been done. 7. Now, reverting to the authority of the Supreme Court in the case of M/s Jai Durga Finvest Pvt. Ltd. (supra), the same is clearly distinguishable. In that case, on fact, it was found that the settlee did not operate the mines on account of the others fault and inaction and in that circumstance, the Supreme Court, found the action of forfeiture of the amount to be bad in law. Even at the cost of the repetition, I may say that the petitioner could not operate the mines for non-deposit of the bank guarantee and for which he alone has to be blamed. 8. Mr. Sinha then contends that the condition requiring to furnish the bank guarantee is illegal as no such provision is made under Rule 11 of the Bihar Minor Minerals Concession Rule, 1972 which, inter alia, provides for settlement of the Sand-Ghat by auction. He emphasizes that an executive decision cannot override the provision of the ru!e. There is no difficulty in accepting the broad submission of Mr. Sinha that an executive decision cannot override the provision of the Act or the Rules, but here, in the present case, no such decision has been taken. Rule 11 of the Rules provided for settlement of the Ghat by public auction. It has not provided for the terms and conditions thereof. Sinha that an executive decision cannot override the provision of the Act or the Rules, but here, in the present case, no such decision has been taken. Rule 11 of the Rules provided for settlement of the Ghat by public auction. It has not provided for the terms and conditions thereof. The terms and condition, therefore, was decided by the State Government in exercise of its executive power which is not unreasonable and does not override the provision of the Rule. It is well settled that an executive decision can be taken to supplement the rule. 9. I do not find any merit in this application and it is dismissed accordingly. However, in the facts and circumstances of the case, there will be no order as to cost.