Delhi High Court
Aman Hospitality Pvt. Ltd. vs The Delhi Development Authority on 24 November, 2006
Equivalent citations: I(2007)BC154
Author: Kailash Gambhir
Bench: Kailash Gambhir
JUDGMENT
Kailash Gambhir, Acting C.J.
1. The petitioner being aggrieved with the rejection of its bid in respect of Hotel plot No. 01, Central Business District (East), Shahdara, Delhi, has filed the present writ petition seeking mandamus or any other direction for quashing the order of the respondent with further direction for the approval of the bid of the petitioner in respect of the said plot being the highest bidder. The brief facts which are not in dispute, inter alia, are that pursuant to the advertisement by the Delhi Development Authority (hereinafter referred as "DDA") for holding a public auction for the sale of nine Hotel plots, the petitioner had participated in the auction held on 03.03.2006 in respect of the said plot at Central Business District (East), Shahdara, Delhi measuring 20,000 sq. mtrs. Reserve price of this plot was fixed at Rs. 167.40 crores @ Rs. 83,700/- per sq. mtrs. of the plot area and Rs. 37,200/- for the built-up area. The petitioner gave bid at Rs. 170.001 crores which was admittedly the highest bid in respect of the said plot in question, and as per the terms of the auction the petitioner had deposited an amount of about Rs. 42.5 crores being 25% of the bid amount. After expiry of more than one month from the date of auction, the petitioner was informed by the DDA through their letter dated 04.04.2006 stating that the bid offered by the petitioner was not approved by the competent authority, i.e., Vice-Chairman, Delhi Development Authority/respodnent. Since there was no reason or ground contained in the said letter rejecting the bid of the petitioner, therefore, the petitioner sought to know the reasons by taking recourse under the provision of Right to Information Act and through this process, the petitioner came to know the detailed history of various bids as invited by the DDA in respect of the same plot prior to the aforesaid bid in question. The petitioner has given details of all these bids and the same are reproduced as under:
Date of tender/open auction Reserve Price Bid received
---------------------------------------------------------------------
28.06.1996 (through tender) 64.66 crore No bid 16.04.1998 (through tender) 82.05 core No bid 23.10.2002 (though tender) 72.45 crore No bid 19.11.2003 (open public auction) 90.00 core No bid 22.03.2004 (open public auction) 90.00 crore No bid 03.03.2006 (open public auction) 167.40 crore 170.001 crore
2. The petitioner further states that the reserve price of Rs. 167.40 crores of the bid in question was fixed by the DDA after wide consultations and with due diligence and after taking into account various factors including current market price of the land in the area, size and usage of the plot and the said reserve price was almost double to the reserve price which was fixed for the open public auction dated 22.03.2004, in response to which no bid was received by the respondent. The contention of the counsel for the petitioner is that in all the five previous auctions when tenders/bids were invited, no response was received by the DDA and when the petitioner had given the bid for a price more than the reserve price, its bid has been arbitrary rejected without any ground or reason. The counsel for the petitioner has also taken us through the relevant proceedings of the DDA concerning the auction of this plot which clearly shows that at every step approval to the said bid of the petitioner was accorded except when it reached to the Member (Finance) who vide his note dated 23.03.2006 opined that the bid price of Rs. 37,778/- per sq. meter in respect of the said plot in question, appeared to be on the lower side. The Member (Finance) took into consideration the price range of Rs. 75,960/- per sq. meter to Rs. 1,26,068/- per sq. meter fetched by the DDA for some Shopping/Office plot in Kondli Gharoli (East Delhi) in the commercial auction held on 23.03.2006 and based on this opinion the DDA was advised to re-auction the plot in question for realizing the alleged real value of the said plot.
3. To properly appreciate the stand of the DDA, it would be relevant to reproduce the following paragraph from the proceeding-sheet of the DDA which has been taken out from page 78-A of the paper book:
In this regard, it is informed that Plot No. 1 was put for auction on 19.11.2003 and 22.03.2004, but no bid was received. In March, 2004, the Reserve Price was Rs. 90 Crores. In the present auction, the Reserve Price was increased from Rs. 90.00 Crores to 167.40 Crores. Despite raising almost double the Reserve Price, the multiple bidding has taken place and the bid has been received, which is quite satisfactory, considering the fact that CBD Shahdara is not a very good location for Hotel plots considering its distance from the Airport and other major destination of Delhi. Hence the bid is recommended for acceptance.
4. Equally important would be to reproduce the observations of the Member (Finance) when he had recommended re-auction of the said plot:
In Plot No. 1, the bid price is Rs. 37,778/- per sq.m. In the recent commercial auction on 23.3.06, in Kondli Gharoli, East Delhi, the auction price range is between Rs. 75,960 psq.m. To Rs. 126,068 psq.m. Rs. 37,778 psq.m. seems on the lower side. We may go for re-auction to realize the real value.
5. Needless to state that the competent authority, i.e., the Vice-Chairman had put a seal on the said advise of the Member (Finance) and thereafter the said rejection of the bid was communicated to the petitioner which action of the respondent is assailed in the present writ petition being termed as illegal, arbitrary, wrongful, whimsical and clear case of non-application of mind.
6. In the interregnum, vide our order dated 18.09.2006 we had permitted the DDA to go ahead with the re-auction of the said plot which was scheduled for 25.09.2006 and the petitioner was given the liberty and right to participate in the said re-auction. However, the respondent was directed not to declare the successful bidder. We have now been informed that auction of ten prime plots on freehold basis for construction of hotels in Delhi including the plot in question, took place on the said scheduled date, i.e., 25.09.2006 and except one bid for plot at Manglam Place Rohini, no party came forward to participate in any of the bids for rest of the plots at various places. This time, the respondent had kept the reserve price for the plot in question at Rs. 244.30 cores as against the reserve price of Rs. 167.40 crores for the auction in question, which took place on 03.03.2006. There is, thus, phenomenal increase in the reserve price within a gap of six months but without response from any bidder. Earlier in the said auction of 03.03.2006 as many as 51 bidders had participated and amongst those 51 bidders, the petitioner's bid was the highest. The chart giving details of auction dated 25.09.2006 of these ten plots, which has been filed today, is taken on record. Mr. Ajay Verma, Learned Counsel appearing for the respondent made a vain attempt to justify non-participation of the bidders in the auction of 25.09.2006 by contending that there was a deterrent effect due to pendency of the present writ petition concerning plot No. 1 which fact was duly notified in the advertisement and, therefore, there was no response from the interested parties. However, Mr. Ajay Verma failed to explain as to why there was no response as against the auction of other eight plots against which also no bidder come forward to participate. Mr. Ajay Verma also contended that as per Clause 3.3 of the terms and conditions of the auction the competent authority, i.e., respodnent is fully competent to reject the bid without assigning any reason. He further submits that the bid in the present case was rejected on rational grounds after taking into account, the rates of the shop/office at Kondli, Gharoli (East Delhi) which were in the range of Rs. 75,960/- per sq. meter to Rs. 1,26,068/- per sq. meter. Mr. Ajay Verma further submits that the power to accept the bid ultimately lies with the competent authority and it is not necessary that if the bid is above the reserve price, then under all circumstances such a bid is to be accepted. The evaluation of the bid as to whether the same is competitive enough to reflect the market value of the plot, is done subsequently by the competent authority as per Clause 3.2(v) of the terms and conditions of the auction which reads as under:
The Officer conducting the auction shall normally accept the highest bid subject to confirmation by the competent authority provided that the highest bid amount is above the reserve price mentioned in the Press advertisement document/ announced in the auction and is found to be competitive enough to reflect the market value of the plot.
7. Based on the above Clause the counsel for the DDA says that action of the respondent is neither illegal nor arbitrary and the same cannot be interfered with.
8. Delhi Development Authority which was constituted under the provision of Section 3 of the Delhi Development Act is the nodal agency for urban planning and its implementation in Delhi. Under the master plan of Delhi the DDA is not only the primary organization but has the monopoly to undertake urban planning and facilitate the development and growth of the city. It is the DDA who has to develop premium destinations for commerce and industry as well as to ensure construction of shopping complexes, hotels, hospitals, school, sport complexes and to take all other measures, so that the image of the city is enhanced and adequate facilities are provided to the residents of the National Capital Territory of Delhi and the people visiting here. The recent auction of various hotel plots at prime locations appears to be primarily keeping in view the forthcoming Common Wealth Games of 2010 when the Capital of the country is expecting large number of tourists and the participants. The various corporate sectors including the hoteliers might be evincing interest to buy such plots, so that they can raise the necessary infrastructure and construct hotels well prior to the commencement of the Common Wealth Games of 2010. This probably appears to be the reason of such large participation of 51 bidders in the auction of the said plot as was held on 03.03.2006. The DDA in its brochure has highlighted its proposal to construct indoor and outdoor stadiums in Yamuna Sports Complex and a village with 8500 flats in front of Akshardham Temple in East Delhi for the said Common Wealth Games of 2010. Relevant Clause (1) relating to the location of the said plot in question and the proposed developments to be undertaken by the DDA for Common Wealth Games, 2010 is reproduced as follows:
(1) CBD SHAHADRA The new Sub-Central Business District, Shahadra (East) is spread over 46 hectares of land is located in the heart of Trans Yamuna Area. The Metro Rail line is passing along with the Vikas Marg in Phase.
The CBD Shahadra (East) is flanked by low rise residentials developments of Rishab Vihar, Arihant Vihar, Surajmal Vihar, Patparganj, Yamuna Sports Complex, Information Technology Campus, IP University, District Court and other Institutional Complexes.
For Common Wealth Games 2010, DDA is proposing to construct and indoor stadium and an outdoor stadium in Yamuna Sports Complex and a village with 8500 flats in front of Akshardham Temple in East Zone.
Total number of plots proposed are about 60 in number with 460.000 sq. mtrs. built up area. The proposed activities at CBD Shahdara include shopping/office complex, wholesale, Service Centre facilities, cultural, hotel and housing functions.
On Commercial Plot No. 9 B & 9 C a Commercial-cum-Multiplex is already coming up. Plot No. 9 D has also been disposed of as commercial plot.
9. It is, thus, evident that large number of bidders turned out to participate in the said auction of Hotel plot No. 01, Central Business District (East), Shahdara, Delhi, taking into consideration, the potentiality of opening a hotel at the said site on account of the Common Wealth Games of 2010.
10. There can be no denial of the fact that there is a wide discretion conferred on the respondent to accept or not to accept a bid in spite of the same being a highest bid and such decision of the DDA may not be open to question unless there is a clear cut case of arbitrariness, mala fide, procedural irregularity or there is a total non-application of mind in rejecting the bid of the highest bidder. In the present facts of the case, there are no allegations of mala fides against the respondent and, therefore, we will be testing the decision of the respondent, on the touchstone of arbitrariness, non-application of mind and perversity in the decision making process. It is not in dispute that prior to auction on 03.03.2006, the same plot was put to auction for five times, i.e., on 28.06.1996 (through tender) with reserve price of 64.66 crores but without any response; 16.04.1998 (through tender) with reserve price of 82.05 without any response; 23.10.2002 (though tender) with reserve price of 72.45 crore without any response; 19.11.2003 (open public auction) with reserve price of 90.00 crore without any response; 22.03.2004 (open public auction) with reserve price of 90 crore again without any response. Ultimately, on 03.03.2006 the same plot was put to auction with reserve price of 167.40 crores when 51 bidders participated and the petitioner gave its bid more than the reserve price at Rs. 170.001 cores. During the pendency of the present matter, the respondent/DDA had advertised in the daily newspapers of 12.08.2006 thereby holding a fresh auction in respect of plot in question and some other plots on 25.09.2006, due to which the petitioner had moved CM No. 10193/2006 for seeking stay of holding of the said auction. On hearing the said application vide order dated 18.09.2006, we had permitted the DDA to go ahead with the auction and the petitioner was also given the liberty to participate in the same and the direction was given to the DDA not to declare the successful bidder. The said permission to re-auction the same very plot was given by us, so as to test whether the respondent gets the highest price of the said plot, then, the one in the last bid. Through this re-auction, the decision taken by the Member (Finance) which was approved by the respondent of taking into account the price of two plots sold in auction as held on 23.03.2006 which fetched more price then the price in respect of the plot in question, could also be tested. Surprisingly in the auction held on 25.09.2006, no participant came forward to give any bid in respect of the plot in question, not only against the plot in controversy but even in respect of eight other plots, out of total nine plots. The non-response from the Hotel Industry/corporate world completely exposes the DDA to its illogical and irrational decision. The people have either not responded on account of the fact that the DDA has kept the reserve price of all these plots at highly exorbitant rates or may be people might have got discouraged to participate not knowing as to what would be the fate of even a highest bidder.
11. Normally, this Court would have been reluctant to interfere with the decision of the respondent as it is respondent who is the final authority as far as the approval of bid is concerned in terms and conditions of the said auction, but in the present case the decision arrived at by the respondent for re-auction on the basis of a plot of 66 sq. meters to 121.50 sq.mtrs. that too in a shopping/office complex, clearly shows a complete non-application of mind on the part of the approving authority.
12. It is true that the law of judicial review in relation to actions of a statutory authority and in relation to discretionary exercise of power by the statutory authority is limited, in that, save and except determining the legality of a statutory action within the parameters of reasonableness as understood in Wednesbury's case, judicial interference has to be avoided. In the decision in Tata Cellular's case reported as AIR 1996 SC 11, principles as under noted were laid down by the Hon'ble Supreme Court:
1. The modern trend points to judicial restraint in administrative action;
2. The Court does not sit as a Court of Appeal over administrative decisions, but merely reviews the matter in which the decisions were made;
3. The Court does not have the expertise to correct administrative decisions. If a review of the administrative decisions is permitted it will be substituting its own decision without the necessary expertise, which itself may be fallible;
4. A fairplay in the joints is a necessary concomitant for the administrative functioning;
5. The administrative decision can be tested by application of Wednesbury principles of reasonableness, and must be free of arbitrariness, bias or mala fides.
13. Prima facie, as the law stands today, limited challenge would be entertained by the Court, being whether the decision in the instant case of the respondent is fair and reasonable within the parameters of reasonableness as understood in Wednesbury's case.
14. Considering the doctrine of reasonableness as propounded in Wednesbury's case, we feel that the competent authority, i.e., respondent had taken a decision in such a casual and opaque manner and, therefore, in the facts of the present case, the decision of the respondent under no circumstances can be considered to be fair and reasonable. We once again make it clear that the right to reject the bid even of the highest tenderer certainly lies within the domain of the competent authority who has to take decision after weighing various factors commercial as well as others, but the decision of the competent authority must be a reasoned and well informed decision. It would, therefore, depend on the facts of each and every case and in the given circumstances, the decision of the competent authority can be justified even when rejecting the bid of the highest bidder or directing re-auction till suitable price of the plot/sites could be fetched. Every case, thus, will depend in its own facts and circumstances, but every action of the State or instrumentality of the State has to be decided on the touchstone of Article 14 of the Constitution of India. At any stage during the decision making process if any arbitrariness, unfairness, mala fides or unreasonablenesses are traced then such an action of the Government has to be set aside being violative of Article 14 of the Constitution of India. It would be worthwhile to reproduce the following paragraph from the judgment of Kumari Shrilekha Vidyarthi etc. etc. v. State of U.P. and Ors. .
35. It is now too well settled that every State action, in order to survive, must not be susceptible to the vice of arbitrariness which is the crux of Article 14 of the Constitution and basic to the rule of law, the system which governs us. Arbitrariness is the very negation of the rule of law. Satisfaction of this basic test in every State action is sine qua non to its validity and in this respect, the State cannot claim comparison with a private individual even in the field of contract. This distinction between the State and a private individual in the field of contract has to be borne in the mind.
36. The meaning and true import of arbitrariness is more easily visualized than precisely stated or defined. The question, whether an impugned act is arbitrary or not, is ultimately to be answered on the facts and in the circumstances of a given case. An obvious test to apply is to see whether there is any discernible principle emerging from the impugned act and if so, does it satisfy the test of reasonableness. Where a mode is prescribed for doing an act and there is no impediment in following that procedure, performance of the act otherwise and in a manner which does not disclose any discernible principle which is reasonable, may itself attract the vice of arbitrariness. Every State action must be informed by reason and it follows that an act uninformed by reason, is arbitrary. Rule of law contemplates governance by laws and not by humour, whims or caprices of the men to whom the governance is entrusted for the time being. It is trite that 'be you ever so high, the laws are above you'. This is what men in power must remember, always.
15. Let us now examine whether the action of respondent in the present case is reasonable or fair or does not suffer from the vice of non-application of mind or is free from arbitrariness.
16. The contention of the petitioner is that after holding of the said auction on 03.03.2006 an exhaustive note was put up by the concerned Assistant in respect of the said auction. In the said note the Programme Assistant (CL) of DDA has stated that despite raising almost double the reserve price, the multiple biding has taken place and the bid which was received is quite satisfactory, considering the fact that the location of the plot in question is not a very good location for hotel plots considering its distance from the Airport and other major destination of Delhi. On the said basis, the Programme Assistant (CL) of DDA has recommended the said bid of the petitioner for acceptance. Thereafter, the file was put up to the Assistant Director (CL), Deputy Director (CL), Commissioner (CL) and the Principal Commissioner. All these officers have accepted the recommendations of bid of the petitioner and dissent to the same came when the file was placed before the Finance (Member) DDA. The Finance (Member) DDA recommended for re-auction of the said plot in question, so as to realise the real value on the analogy that in the recent commercial auction on 23.03.2006 in Kondli Gharoli, East Delhi the auction price as submitted by the highest bidder was between Rs. 75,960/- per sq. mtr. to Rs. 1,26,667/- sq.mtr and considering the auction price of these commercial plots the Finance (Member) felt that the auction bid at Rs. 37,778 per sq. mtr. as submitted by the petitioner in the auction of 03.03.2006 was quite on the lower side. The dissent note of the Finance (Member) is at page 83 of the paper book and the recommendations of other officers from Programme Assistant (CL) to Principal Commissioner are placed at pages 78 and 79 of the paper book. It would be interesting to note that when the DDA had fixed the reserve price of the plot in question, the prices of the two plots which were sold in East Delhi at Karkardooma were not taken into consideration by holding that the rates of these plots being single storied and of different sizes cannot be taken into consideration for fixing the reserve price for the hotel plot. Relevant portions from the notes and proceedings-sheet of the DDA as placed at page 98,100-101 are reproduced as under:
1.CBD Shahdara: The price fixed by the Price Fixation Committee and approved by the VC was Rs. 17,800/-. Now the price has been fixed as Rs. 49,000/-. Finance has taken the current auction zonal rates of 2005-2006 as Rs. 82,729/- per sq.m. This plot was earlier put in the auction in March, 2004 and prior to that also, this plot did not get any bid. In March, 2004, the rate was Rs. 20,000/- per sqm. And no bid was received. It is further mentioned that very few plots have been auctioned in the east zone this year, and this can not become basis for fixing the reserve price. Two plots have been sold at Karkardooma. Both these plots were single storey plot of 240 sqm. And 112 sqm. Single Storey plot always gets more rate because there is always change of adding more floor. Similarly, 2 storey plots of Surajmal Park was sold with an area of 131 sqm. and one plot of 198 sqm. with 4 storey was also sold in Gazipur. So the rates of these plots can not become the basis for fixing the auction rate for hotel plot. Plot for Mayur Vihar did not get any bid in Oct., 2005. Finance has not taken this aspect into account when the reserve price fixed. No bid was received when the price was basically revised in the auction of Oct., 2005.
(1) CBD Shadara: As already stated, the fate of the earlier auction fetching no bid was not brought to the knowledge of the Finance earlier by the Management Wing. In this case, the current zonal average auction rate was reduced by 25% to assess the R.P. for general commercial plots, which were further reduced by 20% for hotel sites. The current average auction rate varies from Rs. 48,032 to Rs. 2,00,568 per sq.m in East zone. The location of CBD Shahdara seems generally ideal for commercial purposes. PFC in the year 2001, had compared the CBD Shahdara with Karkardoma as may be seen from the minutes of the meeting dated 01.06.01 (copy placed opposite). If that is considered, the general commercial rate of CBD Shahdara should be at par with the rates of Karkardooma of Rs. 2.00 lacs per sq.m which happens to be highest rate of the East Zone. But the Finance has considered the zonal average auction rate of Rs. 82,729/- per sq.m. However, considering the facts now brought in the note that the plot were earlier put to auction in March, 2004 but could not fetch any bid, the reserve price proposed may be reduced further by 10%, which may come to Rs. 44,640/- per sq.m. against Rs. 49,600/- already proposed. Likewise reserve price of Rs. 59,600/- proposed earlier for D.C. Mayur Vihar may also be brought down by 10% i.e. to Rs. 53,640/- per sq.m.
17. It is, thus, apparent that the Finance (Member) and even the approving authority of respondent/DDA have not taken into consideration all these aforesaid vital circumstances before arriving at the decision of recommending re-auction of the plot in question. The counsel for the petitioner has also submitted that the plots at Kondli, Gharoli which were sold in auction held on 23.03.2006 are of very small size measuring from 66 sq mtrs. to 121.50 sq.mtrs. and the size of the hotel plot in question is about 20,000 sq.mtrs. and, therefore, there cannot be any comparison of the two sites after taking into consideration the wide disparity in the size of the plot. It is also submitted that the plots at Kondli, Gharoli were meant for shopping/office whereas the plot in question of Central Business District (East), Shahdara, Delhi is primarily for hotel use. When the reserve price for a hotel plot measuring 20,000 sq. mtrs. in East Delhi could not have been fixed after comparing the same with the auction price of the single storied shopping/commercial plots ad measuring 240 sq. meters and 112 sq. meters situated in East Delhi then the DDA fell in grave error by fixing the same criteria at the time of recommending re-auction of the plot after simply taking into consideration the auction bid of 23.03.2006 of two plots of smaller size at Kondli, Gharoli. Taking into consideration the prices of plots, which were for the shopping/office complex, that too of a smaller sizes comparing it with a hotel plot of 20,000 sq.mtr. and not realizing that the plot has been put five times into auction and further not taking into consideration that at the last auction, 51 bidders had submitted their bid in which the petitioner's bid was found to be highest. In the sixth bid the reserve price was almost double to the reserve price of the fifth bid and the petitioner's offer was higher to the reserve price, i.e., at Rs. 170.001 crores. The DDA has a right to fetch more price but at the same time DDA should also give due sanctity to such public auctions more particularly where there is a good response from the participants with competitive biding. When the counsel appearing for the DDA had asked us that they can fetch more price in the auction already scheduled for 25.09.2006 that is during the pendency of the case, we had permitted the said bid to take place, so as to see the response of the participants. In the said auction of 25.09.2006 no bidder came forward, not only in respect of the plot in question but in respect of other eight plots as well. This non response of the participants in the bid of 25.09.2006 certainly reflects that there is something drastically wrong at the end of the DDA and if the DDA continue in such fashion then, certainly, it will lose its credibility. The DDA should have adopted more realistic approach keeping in view the enthusiasm of the hotel industry to set up hotels at the auction sites well before the Common Wealth Games and any delay in the process bound to have proved fatal and which fact stands proved after no response was received by the DDA in the said public auction of 25.09.2006. Merely, rejecting bid on the basis of the recommendation of the Finance (Member) without taking into consideration wide disparities and dissimilarities concerning the site, size and location of the hotel plot with that of site of shopping/office complex at Kondli, Gharoli, was a case of irrationality and, therefore, evidently the decision making process suffered from patent arbitrariness. These kind of actions on the part of authorities take away the public confidence in the open bid system as well as results in avoidable delay in completing the projects thereby ultimately affecting the development, planning and growth of the city. It is a case of complete non-application of mind on the part of the respondent. Who will share the blame and who will be held responsible if the DDA does not even get the price which has been offered by the petitioner and what would happen if there is adverse trend in the market or the market people feels that they may not be able to complete their projects of setting up hotels in a short duration. The DDA must take decisions which can inspire the trust and confidence of the people keeping in view the larger public and national interest utmost while fulfillling its obligation to accomplish its laid down objectives. The bidding process cannot be an unending process. In the present case itself the petitioner had deposited 42.5 crores being the 25% of the bid amount and was the highest bidder amongst 51 participants.
18. We, therefore, hold that non-acceptance of the bid of the petitioner and the decision taken by the respondent suffers from the vice of irrationality, arbitrariness and lack of credibility. The parameters adopted by the DDA in comparing the prices for the hotel plot of 20,000 viz.-a-viz. the price of a commercial shop/office of 66 sq. meters and 121.50 sq. mtrs. has vitiated the decision of the respondent. For the foregoing, we quash the decision of the respondent in rejecting the bid of the petitioner.
19. As we have quashed the decision of the respondent in rejecting the bid of the petitioner, the petitioner is entitled to the consequential relief and we issue a direction to the respondent to accept the bid of the petitioner, accordingly.
20. The writ petition is allowed. Rule is made absolute.