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2005 DIGILAW 939 (PAT)

Sikshit Berojgar Motor Parivahan Swawalambi Sahkari Samittee Ltd. v. State Of Bihar

2005-10-18

S.K.KATRIAR

body2005
Judgment 1. Heard learned counsel for the parties. 2. The authorities prescribed in rule-191 of the Bihar Motor Vehicles Rules, 1992 (hereinafter referred to as the Rules) selected the spot in question as Stand and Halting Station in the township of Hajipur. The applications of the petitioner and respondent no. 5 were considered by the authorities and ultimately the latter was selected to man the Stand in question, vide order dated 7.1.2002 (Annexure 6) and consequential orders dated 1.9.2005 (Annexure 8) and 2.9.2005 (Annexure 9). The matter can be disposed of on a short ground and, therefore, I do not feel the need to discuss the remaining issues canvassed at the Bar. 3. The undisputed position is that there was no advertisement and wide publicity of the intention of the respondent authorities to award the contract in question. The further admitted position is that the petitioner and respondent no. 5 were the only two persons considered by the authorities and respondent no. 5 has been selected by the impugned orders. This Court is in no doubt that the impugned action is arbitrary and violative of Article 19(1)(g) of the Constitution of India. it is settled law by long line of decisions of high authority that public employment and distribution of largess by public bodies in this country is a national wealth, and every citizen should have unrestricted access to the same which can be ensured only by a genuine advertisement giving it wide publicity. There is no material at all on record showing that any advertisement was made about the intended contract in question. The respondents have also not been able to explain as to on what basis the two contencers, namely, the petitioner and respondent no. 5 were chosen for considered. The impugned action is undoubtedly arbitrary, smacks of gross favouritism, and in the teeth of the provisions of Article 19(1 )(g) of the Constitution of India, and falls foul of the authoritative pronouncement of the Supreme Court. The Supreme Court has observed as follows in paragraph 12 in its judgment in the well known case of Ramana Dayaram Shetty vs. The International Airport Authority of India ( AIR 1979 SC 1628 ): "12. We agree with the observations ot Mathew, J., in V. Punnan Thomas vs. State of Kerala AIR 1969 Ker. The Supreme Court has observed as follows in paragraph 12 in its judgment in the well known case of Ramana Dayaram Shetty vs. The International Airport Authority of India ( AIR 1979 SC 1628 ): "12. We agree with the observations ot Mathew, J., in V. Punnan Thomas vs. State of Kerala AIR 1969 Ker. 81 (FB) that: "The Government is not and should not be as free as an individual in selecting the recipients for its largess. Whatever its activity, the Government is still the Government and will be subject to restraints, inherent in its position in a democratic society. A democratic Government cannot lay down arbitrary and capricious standards for the choice of persons with whom alone it will deal." The same point was made by this court in Erusian Equipment and Chemicals Ltd. vs. State of West Bengal (1975)2 SCR 674 : ( AIR 1975 SC 266 ) where the question was whether black-listing of a person without giving him an opportunity to be heard was bad? Ray, C.J. speaking on behalf of himself and his colleagues on the Bench pointed out that black-listing of a person not only affects his reputation which is in Poundian terms an interest both of personality and substance, but also denies him equality in the matter of entering into contract with the Government and It cannot, therefore, be supported without fair hearing. It was argued for the Government that no person has a right to enter into contractual relation-ship with the Government and the Government like any other private individual, has the absolute right to enter into contract with any one it pleases. But the Court, speaking through the learned Chief Justice, responded that the Government is not like a private individual who can pick and choose the person with whom it will deal, but the Government is still a Government when it enters into contract or when it is administering largess and it cannot, without adequate reason, exclude any person from dealing with it or take away largess arbitrarily. The learned Chief Justice said that "when the Government is trading with the public "the democratic form of Government demands equality and absence of arbitrariness and discrimination in such transactions ...The activities of the Government have a public element and, therefore, there should be fairness and equality. The learned Chief Justice said that "when the Government is trading with the public "the democratic form of Government demands equality and absence of arbitrariness and discrimination in such transactions ...The activities of the Government have a public element and, therefore, there should be fairness and equality. The State need not enter into any contract with anyone, but if it does so, it must do so fairly without discrimination and without unfair procedure." This proposition would hold good in all cases of dealing by the Government with the public, where the interest sought to be protected is a privilege. It must, therefore, be taken to be the law that where the Government is dealing with the public, whether by way of giving jobs or entering into contracts or issuing quotas or licences or granting other forms of largess, the Government cannot act arbitrarily at its sweet will and, like a private individual, deal with any person it pleases, but its action must be in conformity with standard or norm which is not arbitrary, irrational or irrelevant. The power or discretion of the Government in the matter of grant of largess including award of jobs, contracts quotas, licences etc., must be confined and structured by rational, relevant and nondiscriminatory standard or norm and if the Government departs from such standard or norm in any particular case or cases, the action of the Government would be liable to be struck down, unless it can be shown by the Government that the departure was not arbitrary, but was based on some valid principle which in itself was not irrational, unreasonable or discriminatory." 4. The observations of the Supreme Court in paragraph 81 in its judgment in the case of M.I. Builders Pvt. Ltd. vs. Radhey Shyam Sahu ( AIR 1999 SC 2468 ) is apposite and is reproduced hereinbelow for the facility of quick reference: "81. High Court in its impugned judgment has not doubted the capacity of M.I. Builders to undertake the project but then that is not the issue. The question is why it was not necessary to invite tenders for the project of such a high cost. Why it was thought that it was only the M.l. Builders in the country who could undertake the job? Why project report was not obtained to know the cost of the project? The question is why it was not necessary to invite tenders for the project of such a high cost. Why it was thought that it was only the M.l. Builders in the country who could undertake the job? Why project report was not obtained to know the cost of the project? Why could it not be thought that there could be any other . person who could undertake the job at a lesser cost and in equally competent manner? Public interest has certainly been given a go-by. There was some undercurrent flowing to award the contract to M.l. Builders. High Court said "lest we are taken amiss we wish to make it clear that we do not doubt either the bona fides or the authorities or the competence of the respondents M/s M.l. Builders to enter into the impugned agreement but we are of the view... "The competence of M/s M.l. Builders to undertake the project is not doubted when now it is seen that proper construction has been made but before taking decision to award the contract to it nobody knew its credentials. No attempt made whatsoever to consider if there was any other person more competent for the job or if of equal competence could offer better terms. In these circumstances, dictum contained in the case of Kasturi Lal Lakshmi Reddy vs. State of J. & K. (1980)4 SCC 1 : ( AIR 1980 SC 1992 ) becomes inapplicable. No advantage can be drawn by the builder from the decision of this Court in G.B. Mahajans case (1991)3 SCC 91 : ( AIR 1991 SC 1153 ) as here the whole process of awarding contract to M.l. Builders has been gone through in an unabashed manner and in flagrant violation of law with the sole purpose of conferring benefit on it. All said and done we fail to understand the certificate given by the High Court about the bona fide of the authorities in awarding the contract to M/s M.l. Builders. The officers of the Mahapalike who were impleaded as respondent by name, did not file any reply to contradict the allegation made against them. Rather it appears that it was fit case where High Court should have directed an enquiry to be made as to how the project came to be awarded to M.l. Builders including the conduct of the lawyers." 5. Rather it appears that it was fit case where High Court should have directed an enquiry to be made as to how the project came to be awarded to M.l. Builders including the conduct of the lawyers." 5. In that view of the matter, the impugned orders dated 7.1.2002 (Annexure 6) 1.9.2005 (Annexure 8) and 2.9.2005 (Annexure 9) are hereby set aside, it will be open to the respondent authorities to make a fresh selection in accordance with law after giving it genuine and wide publicity. The writ petition is accordingly allowed.