Smt. Mamta Mehta v. State of Chhattisgarh & Ors.

Judgment

1. The State of Chhattisgarh, Through Deparfanent of Agriculture, DKS Bhawan, Mantralaya, Police Station- City Kotwali, Raipur (C.G.) Prindpal Secretary,

4. Krishi Upaj Mandi Samiti, Durg District, Through the Secretary Dhamdha Road, Durg (C.G.), Police Station- Mohan Nagar, Durg (C.G.) The Managing Director, Chhattisgarh Rajya Krishi Vipnan Board Raipur (C.G.), Police Station- City Kotwali, Raipur The CoUector, Durg district, Collectorate Parisar Durg (C.G.), Police Station- City Kotwali, Durg. ,^*''" WRIT APPEAL UNDER SECTION 2(1) OF THE CHHATTISGARH HIGH COURT ^APPEAL TO DIVISION BENCH) ACT, 2006 READ WITH RULE a57(10)(E) OF THE HIGH COURT OF CHHATTISGARH RULES 2005 O^- n ^f^ HIGH COURT OF CHHATTISGARH AT BILASPUR DIVISION BENCH AFR CORAM: HON'BLE SHRI YATINDRA SINGH, C.J. HON'BLE SHRI PRITINKER DIWAKER, J Appellant Writ Appeal No.55 of 2013 Ashutosh Vyas VERSUS Resoondents State of Chhattisgarh and others ^ Writ Appeal No. 114 of 2013 Appellant

Smt. Mamta Mehta VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 115 of 2013 Appellant Dipesh Taunk VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 86 of 2013 Appellant Sapanjain VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 94 of 2013 Appellant PrashantAgrawal VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No.85 of 2013 Appellant Uttamchand Jain VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 82 of 2013 Appellant Subhash Sethi Respondents VERSUS State of Chhattisgarh & Others. Writ Appeal No. 89 of 2013 Appellant Kailash Rungta VERSUS Resoondents State of Chhattisgarh & Others. Writ Appeal No. 95 of 2013 Appellant Awesh Duggad VERSUS Respondents State of Chhattisgarh & Others. ^ Writ Appeal No. 97 of 2013 Appellant Manoj Goel VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 98 of 2013 Appellant Vasudev Sachdev VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 93 of 2013 Appellant Krishna Kumar Agrawal Respondents Appellant VERSUS State of Chhattisgarh 61 Others. Writ Appeal No. 88 of 2013 Kamlesh Rungta VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 99 of 2013 Appellant Kantilal Bothra VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 116 of 2013 Appellant Nitin Khatri VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 112 of 2013 Appellant Vipin Khatri VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 108 of 2013 Appellant Manish Kumar Parmar VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 65 of 2013 Appellant Shree Sita Refiners Pvt. Ltd. VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 66 of 2013 Appellant Shree Sita Agrotech Pvt. Ltd. VERSUS Respondents State of Chhattisgarh & Others. ^s 3 Writ Appeal No. 80 of 2013 Appellant Gajanand Sahu VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 111 of 2013 Appellant Rakesh Sahu VERSUS Respondent5 State of Chhattisgarh& Others. Writ Appeal No. 117 of 2013 Appellant Bastimal Surana Respondents VERSUS State of Chhattisgarh & Others. Appellant Writ Appeal No. 102 of 2013 M/s Balaji Enterprises VERSUS Respondents State of Chhattisgarh & Others. Writ Aooeal No. 110 of 2013 Appellant Satyawan Abhishek Kukreja VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 101 of 2013 Appellant Vijay Agrawal VERSUS . Respondents State of Chhattisgarh & Others. Writ Appeal No. 109 of 2013 Appellant Shailendra Verma VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 113of 2013 Appellant Vinitjain VERSUS Respondents State of Chhattisgarh & Others. Wril Appeal No. 107 of 2013 Appellant PrashantTaunk VERSUS Respondents State of Chhattisgarh & Others. Appellant Writ Appeal No. 100 of 2013 Manoj Kumar Agrawal VERSUS Respondents State of Chhattisgarh & Others. Appellant Writ Aooeal No. 96 of 2013 Vishal Bakhtiyar VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 127 of 2013 Appellant Rajeshjain VERSUS Respondents State of Chhattisgarh & Others. Apoellant Writ Appeal No. 128 of 2013 Rajendra Kumar Kothari VERSUS Respondents State of Chhattisgarh & Others. Appellant Writ Appeal No. 129 of 2013 Ramkishan Singh VERSUS Resoondents State of Chhattisgarh & Others. Appellant Writ Appeal No. 130 of 2013 Mukesh Jain VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 131 of 2013 Appellant Sunil Goel VERSUS Respondents State of Chhatfisgarh & Others. Writ Appeal No. 132 of 2013 Appellant Subhash Chand Bakliwal VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 133 of 2013 Appellant Pradeep Agrawal VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 134 of 2013 Appellant Akil Gori VERSUS Respondents State of Chhattisgarh & Others. Appellant Writ Appeal No. 135 of 2013 Ghanshyam Agrawal VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 87 of 2013 Appellant Manojjain VERSUS Respondents State of Chhattisgarh & Others. Appellant Writ Appeal No. 148 of 2013 Devendra Kumarjain VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 149 of 2013 Appellant Pradeep Agrawal VERSUS Respondents State of Chhattisgarh & Others. Writ Appeal No. 145 of 2013 Appellant Sunil Agrawal VERSUS Respondents State of Chhattisgarh & Others. Appellant Writ Appeal No. 146 of 2013 Ankur Pincha VERSUS Respondents State of Chhattisgarh & Others. Writ Petition (C) No. 273 of 2013 Petitioner : M/sTarachand Rameshkumar Respondents : VERSUS State of Chhattisgarh & Others. Writ Appeals under Section 2 of the Chhattisaarh Hiah Court (Appeal to Division Benchl Act. 2006 Writ Petition under Article 226 of the Constitution of India Appearance: Jayaswal, Senior Advocate with Shri Shri Prashant Sourabh Jain, Shri Satyawan Agrawal, Shri PS Koshy, Shri for the respective Ashish Surana and Shri TK Tiwari Appellants and Shri Kishore Bhaduri, Additional Advocate General for the State/ respondents. Petitioner. JUDGEMENT (7th March, 2013)

1. In these cases, the basic challenge is to the order of the Chhattisgarh Rajya Krishi Vipnan Board (the Board) dated ^

30.08.2012 cancelling the auction of 56 sundry shops held by the Krishi Upaz Mandi, Durg (the Committee); and the main point involved is, 'Whether prior approval of before executing the lease deeds of the shops approval already granted for the auction was sufficient.' the Board was necessary pr the •^p.. THE FACTS

2. The Committee advertised for an auction of 56 sundry shops at the mandi campus on 10th and 11th of January, 2011. The basic price for each shop was fixed at ^17,00,OOO/-.

3. The Appellants and the Petitioner (the successful-Bidders) deposited the security amount and submitted their bids. The bids were opened on 21.02.2011. They were successful.

4. The successful-Bidders further deposited a sum of ^3,00,000/- on 07.03.2011. They were to deposit the remaining amount after the completion of certain developments. However, no agreement was entered into between the parties.

5. It appears that there were certain newspaper reports in which it was reported that there was mishandling, under bidding in the auction. The Managing Director (the MD) of the Board wrote a letter to the Deputy Director on 11.05.2011 requiring him to submit a report

6. The Joint Director of the Board also wrote a letter on

23.07.2011 to the Raipur Office to submit report in respect of the same in compliance ofthe letter dated 11.05.2011. The Committee submitted its report on 11.08.2011. 7. Thereafter, the Joint Director of the Board submitted a report to the MD ofthe Board on 17.08.2011.

8. Subsequently, the MD cangelled the auction on 30.08.2012 -%> ,t». y a 'A i^ 'l'i B ^*"- ''•as.'^.^"p ''iS-f-s-rS'y ,«y' -"\ and ordered for re-auction. In compliance of the order, Committee also cancelled the same by its order dated

01.09.2012.

9. The successful-Bidders filed writ petitions challenging the aforesaid orders cancelling the auction in their favour. .^-' '^'

10. The writ petitions in the first 44 cases as well as some other writ petitions were consolidated and were dismissed by the single judge on 07.01.2013. Hence, the writ appeals.

11. The 45th case, namely the writ .petition, was filed subsequently challenging the same orders. As the facts and points involved were the same, it was tagged with the appeals. With the consent of the parties, it is being decided along with the appeals. SUCCESSFUL-BIDDERS' SUBMISSIONS 12. We have heard counsel for the parties. The counsel for the successful-Bidders submit that; (i) No approval of the Board was necessary and the bids became final, as soon as they were accepted by the Committee; (ii)There is no basis in the order dated 30.08.2012; (iii)The reserve price was fixed was ^17,00,OOO/-. The bids a price higher than ^17,00,000/- and they could were for not be cancelled; (iv)The contract was already accepted. The bids can not be cancelled. 1st SUBMISSION: APPROVAL NECESSARY

13. The counsel for the successful-Bidders brought to our notice the letters dated 06.01.2011 and 02.11.2011 and submitthat: (1)The auction was already approved by the Board; (2)There was no necessity for taking separate permission before granting lease to the successful-Bidders. Lv-V 8

14. It is correct that there was prior approval for the auction of the shops, but the questibn here is, whether the approval of the Board was necessary before executing the individual lease deeds or not, or was approval for the auction enough?

15. The Committee as well as the Board have been established under the Chhattisgarh Krishi Upaj Mandi Adhiniyam, 1972 (the Act). Section 7 of- the Act is titled 'Establishment of Market Committee and its Incorporation'. indicates that no transferred by way of sale, Its proviso (see below)1 immovable property shall be acquired, lease or otherwise without the prior permission ofthe Managing Director in writing.

16. The fact that prior approval was necessary was also clarified the Board dated 23.11.2010 (the by the earlier circular of Circular). It was issued much before the auction was held. 1 terms and conditions of the

17. The Circular is the general Its paragraph 5 (see auction for the godown and sundry shops. below)2 clarifies that the prior approval had to be taken after the '7.Establishment of Market Committee and its incorporation-(l) For there shall be a Market Committee having every market area, jurisdiction over the entire market area. (2) Every market Committee shall be a body corporate by the name specified in the notification under section 4, It shall have perpetual succession and a common seal and may sue and be sued in its to such restrictions as are corporate name and shall subject imposed by or under this Act, be competent to contract and to lease, sell or otherwise transfer any property and to acquire, hold, do all other things necessary for the purposes of this Act: Provided that no immovable property shall be acquired, transferred by way of sale, lease or otherwise without the prior permission of the Managing Director in writing. (3) Notwithstanding anything contained in any enactment for the time being in force, every Market Committee shall, for all purposes, be deemed to be a local authority.' 2 Paragra 5 of the circular dated 23.11.2010 is as'follows: *<l-1ch gFR'ET c^ 3nE[R IR 3RiJET/?ftuT ljiri*1-e fen Pi^il ^ WIET if <i4'(ltWi^'yi'< uRa'iii ^ ?i^ 'OT'I, ^ ^ 'CTiar ^nsr ^a ig ^ '?Ti •?r tll'lcb 3iys W OT%q «l-1|t)l ^IT ^ST t, uft ^aRF l 3g_CT3_2t_^ yfssv if ^jtcwS 1^ ^ll^ ^_g7!D3. gw •i4iiid4» ^t wrer 3fiii<;i foraT d^tlttni-'j^IN fS|)W ^n^in (OT ^r ig U|J*'<, P?E ^ '?lftl& 'TO? IR T^S iNt 'WnRcT 1^T ulll'll, ?[Tfe I? W^ ^t fe 1^ ^ ^ 7fr5m/7TTlT-^iT 'T^FI/W^t mq f^T 1^T !pt. f^I fStiT wif 'R SII'ifSd t (CT fli^\ •Trf^T ?ftuf ^e ^ W 4/f^SI!t ^ ^iiT tr/1'c^l"M 'ED^ <^ Wf 4, f^CT 'Tuft Tf g.^tgFT f?rfST (TffSti VR 5t '•frf^r W vf^f ?>ITT f^ PlqfRn 'cft ^iFft t I wrq wra Tf ^r? ?;ra?r wNr cR wfe cRi OT?T ^ t 1?cT q"! ^5<1 +i'(iplcl 1^!IT ull'tl'll '^\ i 'SPV ^ 'sfef <t>i4cii^l 'sn^ ?tTir •dPiR'cid ?t i' -\ auction but before executing the lease deed. Admittedly, in the present case, no such approval was taken afterthe auction.

18. The counsel for the successful-Bidder brought to our notice the conditions 13 and 32 of the approved terms and conditions of the auction dated 07.01.2011 (see below)3 and submit that these conditions indicate that approval was to be granted by the Committee and not by the Board.

19. Paragraph 13 and 32 of the approved terms and conditions of the auction indicate that the Committee could refuse to accept any offer without assigning any reason., This gives right Committee to reject the offer. This does not mean that approval ofthe Board was not necessary before leasing the shops.

20. The conditions mentioned in paragraph 13 and 32 of the terms and conditions are normally given to the person holdjng This does not mean that statutory provision the auction. requiring prior approval conditions cannot over-ride the statutory.provision. is to be ignored. In any case,

21. It is relevant to point out that there is no condition stating required before that prior approval of executing the lease deeds. Had this been mentioned, then there the Board was not could be some substance in the submissions. However, in such an event, the conditions would have been liable to be struck down as contrary to statutory provisions. In our opinion, approval of the Board was required before

22. •executing the lease deed. The first submission has no merit. 3 Paragraph 13 and 32 of terms and conditions for holding the auction are as follows: t|? f^Rft ^TRft ^5t •wlqilf tR^r '2IT ^ ^^rr ^T '13—f^IT^tf ^RIW ildrt ^teTPft srfSrw; '4^t 'tiPlRl wl stTT i 32-'HqIif ^ftaTft 'E& 3RT Wt f^TT f^ft ^TVT •IdTEt '^ft^cT ^i^r '2IT '•T ^i^'f !|5T STtoR 'q^t TiftRr ^ ?pn l / 10 2nd SUBMISSION: THERE WAS BASIS 23. The Respondents had filed the details of the persons, who had tendered in the bid and the entire records were produced. Eighty shops. five tenders were submitted for fifty six There were, • • three tenders in respect of four shops; two tenderers in respect of eighteen shops; • one tender for thirty-four shops.

24. The aforesaid figures show that there was no sufficient competition in the auction. In view of this, it cannot be said the orderdated 30.08.2012 has no basis.

25. In our opinion, there was basis for the order dated

30.08.2012. 3rd SUBMISSION: NOT NECESSARYTO ACCEPT 26. The shops are similarly situate. The reserve price for them the shops were sold at was ^17,00,000/-. In many cases, ^17,01.000/-. In one case the price fetched was^22,50,000/-. The price of one shop is ^22,50,0007- itself shows that 27. perhaps there was no proper competition for the shops. And it is for this reason, that only ^17,01,000/- was received.

28. Merely fixing of reserved price does not mean that it was mandatory to accept the price higher than this. In case the approving authority thinks that— • Sufficient numbers of offers were not received due to non- competitiveness; and • More revenue can be earned than the offers received — Then it can always disapprove the auction. In our opinion,

29. higherthan the reserve price. it was not mandatory to accept the price ^^^aL.^^^ f' /f&s^ y,ii^ ^ 8 te-;?' ^ t; ur? 11 4th SUBMISSION: CONTRACTWAS NOT ACCEPTED 30. The counsel for the successful-Bidders have placed reliance on Bharat Petroleum Corporation Limited Vs Great Eastern Shipping Company Limited, reported in (2008) 1 SCC 503 (the shipping-Company case) and submit that; • There was a contract between the parties; and • The contract can be inferred from the conduct of parties.

31. In the shipping-Company case, is mentioned that acceptance for a contract can be inferred from the conduct ofthe parties. In this case the prior approval of the Board was necessary. 32. In case, there was no prior approval then, no contract can be inferred. This shipping-Company case is not applicable here. In our opinion, no contract can be inferred unless there was

33. prior approval by the Board.

34. Our conclusions are as follows: CONCLUSION (a)Prior approval ofthe Board is necessary before leasing out the shops; (b)There was the cancellation order dated

30.08.2012 by the Board; (c)A contract can not be inferred between the parties, unless there was priorapproval ofthe Board ; (d)The order of the Single Judge dated 07.01.2013 or of the Board dated 30.08.2012 or of the Committee

01.09.2012 cannot be faulted. The writ appeals as well as the writ petition have no merit and they are dismissed. — Sd/- Chief Justice Sd/- Pritinker Diwakar Judge ^s^ 1 A^ 12 HEADLINES Approval of Board is necessary before executing lease under Chhattisgarh Krishi Upaj Mandi Adhiniyam. Sd/- ". . ;