Judgment 1. These two writ applications have been heard together as they relate to the same matter. In the first writ application, the petitioner had challenged Annexure- 14, the communication dated 14.2.2007 of the Electrical Superintending Engineer, Darbhanga whereby pursuant to orders of the Bihar State Electricity Board, the two letter of intents issued in his favour were cancelled. The order of the Board is Annexure-D to the counter affidavit which gives the reason for cancellation and the reasons are communicated to the petitioner by Annexure-19 dated 2.3.2007. In the second writ petition, the petitioner therein challenges the issuance of letter of intent to the writ petitioner of the first writ application on the ground that he being the lowest tenderer and he having offered the lowest price, he ought to have been awarded the tender instead of the petitioner. A comprehensive counter affidavit has been filed by the respondent-Board in the first writ application which covers the dispute. With consent of parties, this writ application is being disposed of at the stage of admission itself. 2. It would be convenient to deal with the second writ petition first. The plea of the petitioner therein is that being the lowest tenderer, he ought to have been selected. In my view, that is not the law. Even though a person may be the lowest tenderer, the authorities could call parties to negotiate. Once parties are called for negotiation then the rates tendered by them looses its significance because then the tender has to be decided on the rates quoted in course of negotiation. I should not be misunderstood as saying that if no negotiations are called for, the authorities are bound to accept the lowest tender. Even where such a situation arises, the authorities could well be justified in not accepting the lowest tender for grounds which may be otherwise valid. In that view of the matter, there being no dispute that the parties were called for negotiation, the writ petitioner of the second writ application cannot succeed and the said writ application is to be dismissed as such. 3. Now there is a common challenge by both the writ petitioners to the action of the respondent-Board in cancelling all the three letter of intents. Two were issued in favour of the petitioner of the first writ petition and one in favour of the writ petitioner of the second writ petition. 3. Now there is a common challenge by both the writ petitioners to the action of the respondent-Board in cancelling all the three letter of intents. Two were issued in favour of the petitioner of the first writ petition and one in favour of the writ petitioner of the second writ petition. 4. The controversy appears as to the legality and propriety of the order of cancellation. The orders of cancellation are in fact contained in letter No. 157 dated 8.2.2007 (Annexure-D) of the Chief Engineer (RE) of the Board in relation to the writ petitioner. 5. It appears that a notice inviting tender was issued for what is now understood as for Franchise Scheme (Rural) for 11 KVA feeder. It appears that once the supply voltage is reduced to 11 kilo volts, the same is then further reduced in feeders to usable voltage and supplied to consumers. It appears that the Board, in order to make its working more efficient, franchised the right to maintain such feeder and collect electricity dues appertaining to those feeders through private organizations. Pursuant thereto a notice inviting tender was issued. This notice was in respect of three 11 KVA feeders of Rajnagar substation being Rajnagar, Pariharpur and Shyam Sidap falling under Madhubani Sub-Division of the Electric Supply Area, Darbhanga, The petitioners of both the writ applications purchased the tender documents and filed their tenders. The purchased documents would clearly show that the documents though gave place for various feeders to be filled in one single document, it only provided for payment of earnest money of Rs. 1,000/-. The tender documents also did not specify that for each feeder separately, applications must be filed. Petitioners having filed their tender, undisputedly petitioner of the second writ application was the lowest tenderer but pursuant to negotiations both agreed to negotiate rates. Petitioner of the first writ application was given the franchise in respect of Rajnagar and Shyam Sidap whereas petitioner of the second writ petition was given Pariharpur at the same rates. Accordingly, two letter of intents were issued. The first in favour of the petitioner of the first writ application in respect of two feeders and another in respect of the petitioner of the second writ petition in respect of one feeder. Accordingly, two letter of intents were issued. The first in favour of the petitioner of the first writ application in respect of two feeders and another in respect of the petitioner of the second writ petition in respect of one feeder. It seems thereafter the matter was referred to the Board and the Board after scrutinizing the matter decided to cancel the two letter of intents as per Annexure-D of the Boards counter affidavit which was ultimately communicated to the two petitioners. Shri Binay Kirti Singh appearing for the Board submitted that the Board had unrestricted right to cancei the letter of intent. It found some discrepancy and cancelled the same. In my view, such an argument cannot be accepted for the simple reason that had the Board not given any reason whatsoever but had merely stated that Board was not satisfied with the offers as made and, as such, wanted to readvertise the matter, the action could have been valid. Regrettably or fortunately in the present case, Board has ascribed reasons for its action. The only reason apparent from Annexure-D to the counter affidavit is that the petitioners ought to have submitted their tender alongwith three sets of earnest money being Rs. 1,000/- each for the feeders in question. In my view, such a ground is not tenable and is mere pretence of an excuse to set aside the letter of intent. Once the rates were negotiated and settled and letter of intent issued then what had to be paid as earnest money for filing the tender looses all its relevance. Once letter of intent is issued then a person is required to furnish security. Earnest money is a deposit made alongwith application to show earnest in pursuing the application. The moment the application is entertained and final orders passed, the earnest ends and it becomes a security. Therefore, going back to deposit of earnest money after letter of intent had been issued and no fault having been found in the letter of intent itself, the action of terminating the letter of intent cannot be sustained. 6. The moment the application is entertained and final orders passed, the earnest ends and it becomes a security. Therefore, going back to deposit of earnest money after letter of intent had been issued and no fault having been found in the letter of intent itself, the action of terminating the letter of intent cannot be sustained. 6. In that view of the matter, Annexure-D to the counter affidavit being Memo No. 157 dated 8.2.2007 of the Chief Engineer (RE) of the Board to the Electrical Superintending Engineer directing it to cancel the letter of intents issued in favour of the writ petitioners of the two writ applications cannot be sustained. Consequentially, the orders issued to the petitioners of the two writ petititons cancelling/withdrawing the letter of intent cannot be sustained and is quashed. The consequences would be that Annexure-12 which is a fresh notice inviting tender would also fall. The writ application is allowed in so far as it concerns to the three feeders discussed above.