Research › Search › Judgment

Karnataka High Court · body

2009 DIGILAW 651 (KAR)

Mineral Miners and Traders, Rep. by its Proprietor K. Ramappa v. Director Department of Mines & Geology

2009-08-19

P.D.DINAKARAN, V.G.SABHAHIT

body2009
Judgment :- This Writ Petition is filed under Articles 226 and 227 of the Constitution of India seeking for quashing of the order passed by the second respondent – Deputy Director, Department of Mines and Geology, Chitradurga, dated 17.10.2008 (Annexure ‘F’ to the writ petition) and to direct the second respondent to refund the Earned Money Deposit and for quashing of the notification published in the news paper dated 05.08.2009 only in so far as it pertains to auction of 2000 Metric Tonnes of Iron Ore lying in Sy. No.9 of Ianahalli village, Hosadurga Taluk and Sy. No.131 of Seeranakatte, Hosadurga Taluk, Chitradurga District. 2. It is averred in the writ petition that the petitioner is having its head office at Bellary and it undertakes mining leases and also purchases mines and minerals from the open market. The office of the respondents conduct regular survey of licences issued for quarrying of mines and minerals in Bellary District as well as in Chitradurga District. While conducting such inspection, the respondent authorities found that several persons had extracted iron ore from different mines without licence and the said illegally extracted iron ore was seized by the authorities. The second respondent published notification on 25.04.2008 inviting tenders for auction of the said illegally extracted iron ore stocked at various Government lands. The petitioner participated in the auction and was the highest bidder in respect of 4800 Metric Tonnes of Iron ore stored in Ianahalli village. The highest bid of Rs.91,00,000/-offered by the petitioner was accepted. The petitioner deposited Rs.22,75,000/-being 25% of the bid amount and the second respondent by letter dated 16.07.2008, directed the petitioner to remove the Iron ore after remitting balance 75% of the bid amount i.e., Rs.68,25,000/-along with royalty, VAT and Tax within 7 days from the date of the receipt of the letter. However, due to incessant rains, it was difficult to approach the site area and the petitioner was unable to transport the iron ore and was unable to remit the balance bid amount. 2.1 It is further averred that the Petitioner made a representation to the second respondent to give it three months’ time to lift the iron ore as well as to deposit the balance bid amount. 2.1 It is further averred that the Petitioner made a representation to the second respondent to give it three months’ time to lift the iron ore as well as to deposit the balance bid amount. The said representation was given to the second respondent within seven days from the date of receipt of the confirmation letter issued by the second respondent (Annexure ‘B’ to the writ petition). The second respondent did not reply to the said representation. However, the second respondent issued one more notice calling upon the petitioner to deposit the balance bid amount, failing which, it was informed that the bid offered by the petitioner would stand cancelled and 25% of the bid amount deposited by it would be forfeited and iron ore would be re-tendered. Petitioner made another representation to the second respondent stating that it had deposited Rs.22,75,000/-and that the value of the said Iron ore had come down drastically in the open market and it would be difficult for it to lift the said iron ore at the rate bidded for. However, by the impugned order dated 17.10.2008, the second respondent has cancelled acceptance of the bid made by the petitioner in the auction held on 06.06.2008 and forfeited 25% of the bid amount deposited by the petitioner. Thereafter, notification has been issued for re-auctioning of the iron ore by publication in the news paper ‘Vijaya Karnataka’ dated 05.05.2009. Being aggrieved by the same, the writ petition is filed contending that forfeiture of the amount deposited by the petitioner by cancelling the bid is unsustainable and the same is liable to be set aside and that no fresh notification could be published and seeking for the above said reliefs. 3. I have heard the learned counsel appearing for the petitioner and the learned Government Advocate appearing for the respondents. 4. Learned counsel appearing for the petitioner submitted that the petitioner had sufficient cause for not depositing balance 75% of the bid amount within time as per the terms of the auction and request for extension of time has been unilaterally rejected by the second respondent. In any view of the matter, the order passed by the second respondent forfeiting 25% of the bid amount deposited by the petitioner, is wholly without jurisdiction and wherefore, the writ petition may be allowed by granting the prayers sought for in the writ petition. 5. In any view of the matter, the order passed by the second respondent forfeiting 25% of the bid amount deposited by the petitioner, is wholly without jurisdiction and wherefore, the writ petition may be allowed by granting the prayers sought for in the writ petition. 5. Learned Government Advocate submitted that since the petitioner did not comply with the terms and conditions of the auction as it has failed to deposit 75% of the bid amount within time granted, the respondents were constrained to cancel acceptance of the bid made by the petitioner and consequently, notification with regard to re-auction of the iron ore is published and the petitioner is not entitled to any relief in this writ petition. 6. We have given careful consideration to the contentions of the learned counsel appearing for the parties and scrutinized the material on record. 7. The material on record would clearly show that the petitioner was successful bidder in the auction conducted on 06.06.2008. Petitioner deposited 25% of the bid amount i.e., Rs.22,75,000/-. The second respondent by his letter dated 16.07.2008, confirmed acceptance of bid made by the petitioner and called upon the petitioner to deposit balance 75% of the bid amount within 7 days from the date of receipt of the letter. Petitioner did not deposit the same and sought for grant of three months’ time to life the iron ore. Thereafter, the second respondent issued notices on 24.07.2008, 19.09.2008 and 25.09.2008 calling upon the petitioner to deposit the balance 75% of the bid amount and to lift the iron ore. Despite the same, the petitioner failed to deposit the balance amount. It is clear from the terms and conditions of the auction that in the event of failure on the part of the successful bidder to deposit balance 75% of the bid amount within time granted, the amount deposited by him/her towards 25% of the bid amount is liable to be forfeited. Therefore, as per the terms and conditions of the auction, in view of the failure on the part of the petitioner to deposit the balance 75% of the bid amount in spite of grant of sufficient time, the amount deposited by the petitioner towards 25% of the bid amount has been forfeited. Therefore, as per the terms and conditions of the auction, in view of the failure on the part of the petitioner to deposit the balance 75% of the bid amount in spite of grant of sufficient time, the amount deposited by the petitioner towards 25% of the bid amount has been forfeited. If the petitioner has suffered any damage or loss owing to breach of contract and wants to claim damages for breach of conditions of the contract, he has to approach competent Civil Court and work out its remedy in accordance with law. In any view of the matter, since the amount deposited by the petitioner towards 25% of the bid amount has been forfeited as per the terms of the auction, we do not find any ground to interfere with the order passed by the second respondent dated 17.10.2008 and the notification issued by the second respondent dated 05.08.2009 impugned the writ petition. In view of the above said facts, it is clear that the decision relied upon by the learned counsel appearing for the petitioner in State of Karnataka Vs. Shri Rameshwara Rice Mills, Thirthahalli, (1987(2) SUPREME COURT Reports 398) is not helpful to the petitioner in the present case. Accordingly, we hold that the Writ Petition is devoid of merit and pass the following Order:- The Writ Petition is dismissed.