JUDGMENT I.A. Ansari, J. 1. By this common judgment and order, I propose to dispose of WP(C) Nos. 2639/04 and 8283/04, for, both these writ petitions have been heard together on the ground that these two writ petitions are wholly inter-linked and the decision in any of these two writ petitions would have a serious bearing on the outcome of the other one. 2. Can settlement of a fishery be refused to be made in favour of a cooperative society, comprising of 100 per cent fishermen communities, which is, otherwise, eligible to participate in a tender process and entitled to preferential treatment under Rule 12 of the Assam Fishery Rules, 1953, (in short, 'the Rules') by relying upon materials, which were received by the authorities concerned, after the tenders were opened, wherein allegations against the functioning of the society had been made, without, however, having given any opportunity of showing cause by the authorities concerned to the cooperative society to have their say in respect of the allegations levelled against them is the moot question, which the present writ petitions have raised. 3. Let me set out, in brief, the material facts, which are not seriously in dispute. 4. During the pendency of the two writ petitions aforementioned, the Court passed an order, on 3.12.2004, in WP(C) No. 8283/2004, allowing the respondent-Corporation to manage the said fishery. This direction was impugned by this petitioner, namely, Sri Jitendra Das in WA No. 445/04. The appeal was disposed of at the motion stage itself, on 8.12.2004, with observation that the appellant may move the Court for expeditious disposal of the writ petition. WP(C) No. 2639/2004 5. Let me first deal with the material facts of WP(C) No. 2639/2004. 6. By a Notice Inviting Tender (in short, "NIT), published, on 27.1.2004, by the Assam Fishery Development Corporation (in short, "the respondent-Corporation"), sealed tenders were invited from individuals. Self-help Corporations, fishermen societies, registered under the Cooperative Societies Act and comprised of actual fishermen having fishing experience, for leasing out, amongst others. Sonbeel Group Fisheries, district Karimganj, (hereinafter referred to as "the said fishery"), for a period of 7 years commencing from the financial year 2004-05 to 2010-11. Self-help Corporations, fishermen societies, registered under the Cooperative Societies Act and comprised of actual fishermen having fishing experience, for leasing out, amongst others. Sonbeel Group Fisheries, district Karimganj, (hereinafter referred to as "the said fishery"), for a period of 7 years commencing from the financial year 2004-05 to 2010-11. The NIT stipulated, inter alia, that preference for settlement would be given if the rate offered by a society, as described hereinbefore, is found to be lower but within 7½ per cent of the offer given by the highest bidder provided that the society offers its willingness to accept the fishery at the highest bid. The petitioner, in WP(C) No. 2639/2004, namely, Sonbeel Fishermen Co-operative Society Ltd., which is a society registered under the Co-operative Societies Act with all its shareholders being actual fishermen belonging to Scheduled Caste fishermen community and located adjacent to the bank of Sonbeel Fishery (in short, 'the petitioner-Society'), submitted its tender in respect of the said fishery. When the tenders were opened on 16.2.2004, the respondent No. 3, namely, Sri Jitendra Das, was found to be the highest bidder. As the offer of the petitioner-Society was lower by less than 7½ per cent of the bid value offered by the respondent No. 3, the petitioner society expected that an invitation would be issued to them by the respondent-Corporation to offer their willingness to accept the said fishery at the highest bid. On 19.2.2004, the petitioner-Society, however, submitted a written representation seeking settlement of the said fishery, in their favour, on the ground that they were entitled to be given preferential treatment in terms of the NIT. Before the representation, dated 19.2.2004, addressed to the respondent-Corporation was received by the respondent-Corporation, the Corporation settled the said fishery in favour of the respondent No. 3 for 7 years by order, dated 18.3.2004. 7. Aggrieved by the settlement made in favour of the respondent No. 3 in WP(C) No. 2639/2004 aforementioned, namely, Sri Jitendra Das, the petitioner-Society impugned the same, in the said writ petition, seeking, inter alia, issuance of appropriate writ(s) setting aside and quashing the impugned settlement order, dated 18.3.2004, aforementioned and commanding the respondent Nos. 7. Aggrieved by the settlement made in favour of the respondent No. 3 in WP(C) No. 2639/2004 aforementioned, namely, Sri Jitendra Das, the petitioner-Society impugned the same, in the said writ petition, seeking, inter alia, issuance of appropriate writ(s) setting aside and quashing the impugned settlement order, dated 18.3.2004, aforementioned and commanding the respondent Nos. 1 and 2, namely, Secretary to the Government of Assam, Fishery Department and the Managing Director, Assam Fisheries Development Corporation, respectively, to settle the said fishery in favour of the petitioner-Society at the highest rate, that is, the rate offered by the respondent No. 3 in WP(C) No. 2639/2004. 8. The respondent-Corporation has appeared in WP(C) No. 2639/04 and has defended the impugned order of settlement on three grounds, namely, (i) that at the time, when the order of settlement was made, on 18.2.2004, the petitioner-Society's representation, dated 19.2.2004, offering to accept the settlement of the said fishery at the highest bid value offered by the respondent No. 3 had not been received, that is to say, there was no offer from the end of the petitioner-Society to accept the settlement at the highest bid value offered by the respondent No. 3; (ii) there was report of gross irregularities in the functioning of the petitioner-Society and the petitioner-Society was functioning under a one-man committee appointed by the Registrar of the Co-operative Societies, Assam; and (iii) A representation had been received, on 16.2.2004, by the respondent-Corporation from the people living in the neighbourhood of the said fishery alleging that the petitioner-Society had, as a lessee, in the previous years, sold their fishing rights to third persons, which was violative of the terms and conditions of the settlement granted in favour of the petitioner-Society, for, the terms of the previous settlement had clearly stipulated that the income of the local fishermen cannot be hampered by bringing fishermen from outside. 9. As far as the private respondent, namely, the respondent No. 3 is concerned, his case, in brief, in WP(C) No. 2639/2004 is that the settlement of the said fishery had been made in his favour as he was the highest bidder and the petitioner-Society, for the reasons brought on record by the respondent-Corporation, was not found suitable for settlement. WP(C) No. 8283/2004 10. Let me, now, deal with the material facts of the WP(C) No. 8283/2004. 11. WP(C) No. 8283/2004 10. Let me, now, deal with the material facts of the WP(C) No. 8283/2004. 11. What needs to be noted, at the very outset, while considering WP(C) No. 8283/2004, is that the petitioner in WP(C) No. 8283/2004 is the respondent No. 3, in WP(C) No. 2639/2004, namely, Sri Jitendra Das aforementioned. His grievances in his writ petition are as, thus : Being the highest bidder, this petitioner (i.e., the respondent No. 3 in WP(C) No. 2639/2004 aforementioned) was settled, on 18.3.2004, with the said fishery for a period of 7 years from 2004-05 to 2010-2011. Upon deposit of Kist money and after entering into an agreement with the respondent-Corporation, this petitioner, (i.e., the respondent No. 3 in WP(C) No. 2639/2004) was handed over the said fishery on 31.5.2004. As the Settlement given to him was challenged in WP(C) No. 2639/2004 aforementioned, but no interim order was passed therein, this petitioner continued to operate the said fishery. On 1.7.2004, the respondent No. 4 in WP(C) No. 8283/2004, Sri Ratish Das, submitted a forged deed of lease before the respondent No. 2, namely, Managing Director of the respondent-Corporation, alleging therein, inter alia, that this writ petitioner has sub-leased a part of the said fishery in favour of the respondent No. 4. This petitioner submitted his representation against the said allegation made by the respondent No. 4, the matter was enquired into by the respondent No. 2 and, after hearing the petitioner and also the respondent No. 4, the respondent No. 2 cancelled the settlement made in favour of this petitioner on 19.10.2004 and settled the said fishery, on 26.10.2004 in favour of the respondent No. 5. Terming this cancellation of the settlement as arbitrary and illegal, this petitioner has approached this Court in WP(C) No. 8283/2004 aforementioned to get, inter alia, the said order of cancellation set aside and quashed. 12. Since the two writ petitions aforementioned, namely, WP(C) Nos. 2639/04 and 8283/04, are closely interlinked, as can be noticed from the facts narrated hereinabove, both these writ petitions, as has already been mentioned hereinabove, have been heard together. 13. I have heard Mr. A.K. Goswami, learned senior Counsel, assisted by Mr. A Biswas, learned Counsel, for the petitioner in WP(C) No. 2639/2004, and Mr. G. Uzir, learned standing Counsel for the respondent-Corporation. I have also heard Mr. A.M. Mazumdar, learned senior counsel, assisted by Mr. 13. I have heard Mr. A.K. Goswami, learned senior Counsel, assisted by Mr. A Biswas, learned Counsel, for the petitioner in WP(C) No. 2639/2004, and Mr. G. Uzir, learned standing Counsel for the respondent-Corporation. I have also heard Mr. A.M. Mazumdar, learned senior counsel, assisted by Mr. N Saikia, for the respondent No. 3 in WP(C) No. 2639/2004. I have further heard Mr. A.M. Mazumdar, learned senior counsel, assisted by Mrs. N. Saikia, for the petitioner in WP(C) No. 8283/2004, and Mr. G. Uzir, learned standing counsel for the respondent-Corporation. 14. In view of the fact that the respondent-Corporation was required to settle the fishery, in question, by resorting to tender system, the essential terms and conditions, contained in the notice issued by the respondent-Corporation inviting tenders are sacrosanct and must be scrupulously followed as in any other tender process. For settlement of the registered fisheries by the respondent-Corporation, guidelines have been issued by the respondent-Corporation. Clause 6 of these guidelines reads thus, "preference will be given to the Societies comprised of 100 per cent actual Scheduled Caste fisherman (Maimal community wherever applicable) provided the tender value of the Society is within 7.5 per cent of the highest bid and if the Society is selected, the settlement is to be taken on the highest bid value." 15. Since the NIT, in question, was issued by the respondent-Corporation, the NIT incorporated, in clear terms, that preference would be given to cooperative societies if the bid value of the society is below but within 7½ per cent of the highest bidder's value and if the society offers willingness to accept the fishery at the highest bid. 16. From a careful reading of the contents of the NIT in question, it is more than abundantly clear that if a cooperative society of the description as given hereinabove is a tenderer and even if its bid value is lower than the bid value of the highest individual tenderer, yet if the bid value offered by such a society is lower than the highest bidder's value but within 7½ per cent of the highest bid value, the society would be granted settlement if it is willing to accept settlement at the bid value offered by the highest bidder and if it is, otherwise, not disqualified. 17. 17. In the case at hand, there is no dispute that the petitioner-Society is a society, which comprises of 100 per cent actual Scheduled Caste fishermen, and since the bid value offered by this Society was within the range of 7½ per cent of the bid value of the highest bidder, (i.e., the respondent No. 3 in WP(C) Nos. 2639/2004 and petitioner in 8283/2004), the society was entitled to be given preferential treatment, while making order of settlement. In such circumstances, it was the bounden duty of the respondent-Corporation to enquire from the petitioner-Society if the petitioner-Society was willing to receive the settlement at the highest bid offered by the respondent No. 3, in WP(C) No. 2639/2004, namely, Sri Jitendra Das aforementioned. Since every act of the State and its instrumentalities have to be reasonable and in consonance with the directive principles of the State policy, it can be no defence for a Corporation, such as, the respondent-Corporation, to say that before the Corporation decided to settle the fishery in favour of the individual bidder, the cooperative society, whose bid value was lower, but within 7½ per cent of the highest bidder's value, had not offered its willingness to accept the settlement at the value offered by the highest bidder. In all fairness, the initiative in a situation, such as the present one, must be taken by the respondent-Corporation; but the respondent-Corporation, what emerges from the materials on record, completely failed to act reasonably and find out from the petitioner-Society, who were, otherwise, entitled to preferential treatment, if the petitioner-Society was willing to accept the settlement of the said fishery at the highest bid value received by the respondent-Corporation. Having not done so, the respondent-Corporation must be held to have acted unreasonably, irrationally and arbitrarily, particularly, when it had not fixed any date for counter-offer to be made or willingness to be expressed by a tender, who, in terms of the NIT, was entitled to preferential treatment. 18. Having not done so, the respondent-Corporation must be held to have acted unreasonably, irrationally and arbitrarily, particularly, when it had not fixed any date for counter-offer to be made or willingness to be expressed by a tender, who, in terms of the NIT, was entitled to preferential treatment. 18. As regards the defence of the respondent-Corporation that on account of bickering and irregularities of the society, a society was being run by a one-man committee appointed by the Registrar of the Co-operative Societies, and was, therefore, not considered fit for receiving the settlement, suffice it to mention here that there is no thing on the record to show that there is any law and/or standing policy of the respondent-Corporation and/or of the Government not to extend preferential treatment, which the guidelines of the respondent-Corporation and the NIT aforementioned incorporated, if at the time, when the tender process is initiated for settlement of a registered fishery, a society, which comprises of 100 per cent actual Scheduled Caste fishermen, will be ineligible to receive settlement if it is being run by a non-elected committee or a committee formed and constituted by the Registrar of the Co-operative Societies under the Co-operative Societies Act. 19. Since the philosophy behind ensuring preferential treatment to a cooperative society if it is being run by a non-elected committee or a committee formed and constituted by the Registrar of the Co-operative Societies under the Co-operative Societies Act is to ensure upliftment of the actual fishermen by augmenting their income, it is not really material if the society, which participates in such a tender process, is being managed and run by an ad hoc committee constituted by the Government or Registrar of the Cooperative Societies or whether the society is run by an elected managing body. For the failure of the managing body of a cooperative society to properly manage its affairs, its shareholders cannot be made to suffer. For the failure of the managing body of a cooperative society to properly manage its affairs, its shareholders cannot be made to suffer. Had there been more than one co-operative societies comprising of 100 per cent actual Scheduled Caste fishermen and had more than one such societies been tenderers in the tender process, a society, which is better managed may, perhaps, be given preference over the society, which is not being properly managed; but when a society is being run and managed by a committee appointed by the Registrar of the Co-operative Societies under the Cooperative Societies Act, such a society is not disqualified from participating in a tender process initiated for settlement of fishery and since the fact that the society is being managed by an ad hoc committee appointed by the Registrar is not a disqualification and does not make the society ineligible to participate in the tender process, it could not have been denied the benefit of preferential treatment, which the NIT, in question, promised. 20. Turning to the third ground on which the respondent-Corporation has relied upon to sustain denial of settlement in favour of the petitioner-Society, what is pertinent to note is that the representation from the people living in the neighbourhood of the said fishery alleging that the petitioner-Society had violated the terms and conditions of the lease during the previous years by allowing fishermen from outside the neighbourhood to fish in the said fishery was received by the respondent-Corporation as late as on 26.2.2005, whereas the tenders had been opened on 16.2.2004. At no stage from the time, when the tender papers were opened and the time, when the decision not to settle the fishery in favour of the petitioner-Society was taken on 18.3.2004, the petitioner-Society was given any opportunity of showing cause and/or hearing with regard to the allegations levelled against them in the representation, dated 26.2.2004 aforementioned. The act of the considering the allegations contained in the said representation by the respondent-Corporation and reliance placed thereon behind the back of the tenderer (that is, the petitioner-Society), and denial of preferential treatment to the tenderer (i.e., the petitioner-Society) without granting them any opportunity of having their say in respect of the accusations made against them by persons, who were stranger to the tender process, is a gross violation of the principle of natural justice and cannot, therefore, be sustained. If a tenderer, who is, otherwise, eligible for settlement has to be denied settlement on some allegations received against him, the authority inviting tender has a duty cast upon it to verify such allegations and if it finds that there is substance, it must give an opportunity to the tenderer, in question, to have his say with' regard to the accusations made against him unless the material on which the authority relies can be claimed to be a privileged information or document. 21. In the case at hand, the respondent-Corporation has clearly revealed that it had relied, amongst others, as indicated hereinabove, on the representation, dated 26.2.2004, aforementioned. It is also not in dispute that the petitioner-Society was given no opportunity of having their say on the accusations made in the said representation. In a situation, such as, the present one, imperative it was, on the part of the respondent-Corporation, to give an opportunity of showing cause to the petitioner-Society before the settlement was made in favour of the private respondent No. 3, namely, Sri Jitendra Das. Having not been so, the respondent-Corporation acted grossly in violation of the principle of natural justice and such an act of a Corporation, which is an instrumentality of the State, must be held to be arbitrary and not sustainable under Article 14 of the Constitution of India. Principles of natural justice are all pervasive and even in a tender system, the golden principles of natural justice, whenever and wherever required, must be followed. If not followed, the High Court has a duty cast upon it under Article 226 of the Constitution of India to interfere with such a tender system, particularly, when it causes prejudice to the tenderer, who is, otherwise, not ineligible to be considered for award of settlement or lease. 22. In the case at hand, the petitioner-Society was seriously prejudiced by the act of the respondent-Corporation, when the latter relied on the representation, dated 26.2.2004, aforementioned behind the back of the petitioner-Society and declined to give the preferential treatment to the petitioner-Society, which the society was, otherwise, entitled to receive. Situated, thus, there can be no escape from the conclusion, if I may reiterate, that the petitioner-Society was seriously prejudiced by the arbitrary, irrational and unreasonable acts of the respondent-Corporation. 23. Situated, thus, there can be no escape from the conclusion, if I may reiterate, that the petitioner-Society was seriously prejudiced by the arbitrary, irrational and unreasonable acts of the respondent-Corporation. 23. What emerges from the above discussion is that the settlement made in favour of the private respondent No. 3, who is the petitioner in WP(C) No. 8283/04, was arbitrary and illegal and cannot be sustained. 24. What is, now, of paramount importance to note is that the settlement, which had been given in favour of the respondent No. 3 aforementioned, has already been cancelled. Since the settlement given to the respondent No. 3 was illegal, it is not really material as to whether the cancellation was justified or not, for, even if the cancellation was illegal, the respondent No. 3 is not entitled to restoration of his settlement. 25. Considering, therefore, the matter in its entirety and in the interest of justice, the impugned order, dated 19.10.2004, whereby the settlement made in favour of Sri Jitendra Das was cancelled is not interfered with, but the settlement made in favour of the respondent No. 5, in WP(C) No. 8283/2004, is set aside and quashed. The respondent-Corporation is hereby directed to give an opportunity to the petitioner-Society to have their say against the allegations contained in the representation, dated 19.2.2004, aforementioned and upon considering, thereafter, the matter in its entirety, in the light of what have been observed in the preceding paragraphs of this judgment, the respondent-Corporation shall decide, in terms of the contents of the NIT, in question, the relevant guidelines and also the provisions of law contained in that behalf, whether or not to make settlement of the said fishery in favour of the petitioner-Society. Whatever decision is reached by the respondent-Corporation shall be communicated, in writing, to the petitioner-Society. If the petitioner-Society feels aggrieved by the decision, which may be taken by the respondent-Corporation, the petitioner-Society shall remain at liberty to approach this Court for such reliefs) as they may be entitled to. 26. With the above observations and directions, this writ petition shall stand disposed of. 27. No order as to costs.