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Raj Kumar Karanwal v. Commr., Moradabad Division

Supreme Court of India · 4 November 1996

Court
Supreme Court of India
Decided
4 November 1996
Case no.
SLP(C) No. 21020 of 1996
Bench
K. Ramaswamy, G.B. Pattanaik
Length
4 pages
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PETITIONER:
RAJ KUMAR KARANWAL
Vs.
RESPONDENT:
THE COMMISSIONER & ANR.
DATE OF JUDGMENT: 04/11/1996
BENCH:
K. RAMASWAMY, G.B. PATTANAIK

ACT

HEADNOTE

JUDGMENT

THE 4TH DAY OF NOVEMBER, 1996 Present :

Hon’ble Mr. Justice K.Ramaswamy

Hon’ble Mr. Justice G.B. Pattanaik

K.S. Chauhan and Anil Karnwal, Advs. for the Petitioner

ORDER

The following Order of the Court was delivered:

ORDER

The petitioner, admittedly, had made a bid in the auction for the year 1993-94, conducted on February 25, 1993 for a sum of Rs. 1,20,000/- per annum. The said bid could not be worked out for the reason that the previous contractor had approached the High Court and had the operation of the contract stayed which period expired by efflux of time. Consequently, for the years 1995-97, instead of conducting fresh auction, on an application made by the petitioner, the Executive Engineer had recommended to grant lease to the petitioner for the same amount of Rs. 1,20,000/- for two years as was done in the previous order which was accepted by the first respondent on September 2, 1995. On subsequent instructions, the first respondent had cancelled the grant of the lease to the petitioner by his proceedings dated October 28, 1995. When the petitioner had challenged the legality thereof, the High Court in W.P.No. 31606 of 1995 by order dated August 27, 1996 treating the grant of contract to the petitioner as an extension of the previous grant, held that the first respondent was devoid of power to extend the lease without obtaining prior permission of the State Government. Thus, this special leave petition.

It is contended by Mr. K.S. Chauhan, learned counsel for the petitioner, that the first respondent having granted the lease for the years 1995-97, had no power to cancel the same under Rule 7 of the U.P. Toll Tax Regulations Levy & Collection Rules, 1980 (for short, "the Rules") which gives absolute power to the Commissioner under Rule 7 thereof. Therefore, without any power to review his own order, the Commissioner is devoid of power to cancel the same. We find no force in the contention.

Even assuming that the view taken by the High Court is not sound in law, since it is a fresh grant, the ultimate decision can be rested on the following circumstances. Rules 4,7,8 and 9 of the Rules reads as under :

"4. Procedure for grant of lease.-

In accordance with the provision of

Section 2-C of the Act.

(i) The Governor or his nominee may

invite auction bids from the

persons desirous of taking lease

for the collection of the tools

levied on the bridge specified in

the notification issued by the

Government.

(ii) The Governor or his nominee

shall scrutinize the auction bids

and verify the status any other

particulars submitted by the

applicants and after examining the

documents or papers submitted by

the applicants shall prepare a list

of the suitable candidate to whom

the lease contract may be granted.

(iii) If it is considered

necessary the Governor or his

nominee may call any bidders for

negotiations.

(iv) The Governor or his nominee

presently the Divisional

Commissioner, will select any

person out of the list of the

bidders and may order that the

said person contractor shall be

granted lease on respect of the

right to collect tolls on the

specified road bridge.

(v) The Governor, if it considers

necessary, in public interest may

put to public auction the lease of

the right to collect tolls on any

specified road bridge. Such public

auction shall be held after giving

prior notice in important

newspapers by the authorised

officer by giving a minimum notice

of one month in the first instance.

If such occasion arises which makes

the tenders/auction to be re-

invited redone. a similar notice of

one month for the public auction

may be issued.

(vi) The Governor or his nominee

presently the Division Commissioner

shall have the power to accept or

reject any bid/tender and his

decision in that respect shall be

final.

(vii) No lease/contract of the

right to collect the tolls under

the Act on any road bridge shall be

made for a period exceeding 5(five)

years at a time.

(viii) The Governor or his nominee

shall require the lessee to furnish

security equal to three months

installment of auction money (

including earnest money).

(ix) The lease/contract shall be

executed on the standard form.

(x) The cost of execution and

registration of the lease be borne

by the lessee.

7. Vesting to powers accepting

auction bids- The powers accepting

auctions and entering into

agreement on behalf of the Governor

of Uttar Pradesh shall be vested in

the Commissioner of the Division

concerned or any officer as may be

authorised by the Governor to do so

in this behalf.

8. Accepting of highest auction bid

if an auction bid/negotiated offer

is not the highest one, the lower

auction bid/negotiated offer can

only be accepted after getting the

proper approval of the State

Government.

9. Extension of the lease - No

Extension of lease may be granted

without the prior sanction of the

State Government".

Rule 4(i) give power to the Governor or his nominee to invite auction bids from the persons desirous of taking lease for the collection of the tolls levied on the bridge specified in the notification issued by the Government. Rule 4(ii) envisages that the Governor or his nominee shall scrutinize the auction bids and verify the status and other particulars submitted by the applicants and after examining the documents or papers submitted by the applicants, shall prepare a list of the suitable candidate to whom the lease contact may be granted. If it is considered necessary the Governor or his nominee may call any bidder for negotiations under sub-rule (iii). Under sub-rule (iv) power has been given to select nay bidder and thereafter the person nominated has power to grant contract of lease in respect of the right to collect tolls on the specified road bridge. Sub-rule (v) gives alternative mode of grant of lease by public action with which we are not concerned in this case. After the grant of the lease, not exceeding five years as envisaged under sub-rule (vii), the lessee shall furnish security equal to three months instalment of auction money. He shall execute the contract in the standard from under sub-rule (ix). After execution thereof, the power of acceptance has been given to the Commissioner-Ist respondent under Rule 7 of the Rules. If the auction bid after negotiation is not the highest one, the lower auction bid can only be accepted after getting the approval of the State Government under Rule 8; extension of the lease is regulated under Rule 9.

Thus the mode conducting auction is a complete code by itself regulating the right to collect the tolls on the specified road bridges by public notification. It is seen that the first respondent was devoid of any power to accept any bid for the previous years which expired by efflux of time except in the manner prescribed under Rule 4 and the following rules thereafter. The action of the first respondent, therefore, is one without jurisdiction and thereby it is a nullity. The Government, therefore, was right in directing the first respondent to have the order granting lease by him to the petitioner, cancelled. We do not find any illegality in the action taken by the respondent warranting interference.

The special Leave Petition is accordingly dismissed.

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