Patna High Court
Uma Shankar Singh vs Excise Commissioner, Bihar, Patna And ... on 6 July, 1988
Equivalent citations: AIR1989PAT159, AIR 1989 PATNA 159, (1988) BLJ 979, 1988 BBCJ 657, (1988) PAT LJR 942, 1988 BLT (REP) 507
Author: N.P. Singh
Bench: N.P. Singh
ORDER
1. The case of the writ petitioner in the writ application before us is, inter alia, that a notification was published in the daily newspaper 'Aaj' of Patna on the 14th Mar., 1988, on behalf of the Excise Department of the Government of Bihar. It was notified that the shops for both foreign and country liquor for different districts of the State of Bihar would be settled on open bid on the dates specified for specific districts. The date for settlement of the shops in the district of Vaishali was notified to be the 21st March, 1988.
2. Uma Shankar Singh, the writ petitioner, was interested in bidding for the liquor shops to be settled in the Vaishali District and on the 16th Mar., 1988, he made enquiries at the Office of the Superintendent of Excise, Vaishali (Hazipur) (respondent No. 3) with the intention of filing the necessary application. The petitioner was informed at the Office of the respondent 3 on that date that the last date for submitting applications with requisite papers was the 15th Mar., 1988, and, therefore, the petitioner was out of time and could not file any appplication.
3. Earlier on the 15th Mar., 1988, on. enquiry from the Office of the Collector of Vaishali (Hazipur) the petitioner was also informed that the said date, namely, the 15th Mar., 1988, was the last date for submission of relevant papers and for making necessary deposit of money.
4. The petitioner aggrieved by the aforesaid filed this writ application on the 30th Mar., 1988, contending, inter alia, that it was not possible for any genuine bidder to submit a lawful bid in compliance with the notification as the Excise authorities, namely, the Excise Commissioner, Bihar, Patna, the Collector, Vaishali. (Hazipur), and the Superintendent of Excise, Vaishali (Hazipur), the respondents, did not afford any reasonable opportunity to the public to put in their bids. It was contended further that the Excise authorities acted mala fide so that the shops in question could be settled to persons in favour and not to outsiders. It was contended further that the settlements, which were going to be made on the basis of the said notification in favour of successful bidders on and from the 1st April, 1988, would be illegal and liable to be set aside.
5. The petitioner prayed for appropriate writs or orders restraining the Excise authorities from settling the liquor shops in dispute and further from taking any steps for settling the said shops in favour of any other bidder.
6. This application was opposed on behalf of the respondents at the stage of admission and a counter affidavit by one Ramchandra Prasad Sinha, Inspector of Excise, Hazipur, affirmed on the 14th April, 1988, was filed in opposition to the writ petition on behalf of the respondents 2 and 3.
7. It is stated in this affidavit, inter alia, that by instructions issued by the Board of Revenue under the Bihar and Orissa Excise Act II of 1915 the procedure fpr settlement of liquor shops by auction and the conduct of auction sales have been laid down. The relevant clauses of the procedure being Clauses 87 and 88 read as follows :--
Clause 87.
"Dates how fixed -- The dates of the annual settlements or auction sales will be fixed by the Commissioner of Excise and communicated to the Collectors who will publish themin such manner as they consider necessary."
Clause 88.
"Sale notice -- A sale notification in Form 127 will be published in the vernacular of the district fifteen days before the date fixed for the commencement of the settlements. A copy will be posted and kept for inspection at the Collectorate, and at any other place, when auction is held. The date of settlement should also be publicly notified in the vicinity of each shop."
8. It is alleged that for the district of Vaishali the Excise Commissioner fixed the 21st Mar., 1988, as the date of auction for settlement in terms of the aforesaid procedure which was communicated to the Collector of Excise. Vaishali, by a letter of the Excise Commissioner da ted the 1st Mar., 1988.
9. A sale notification in the prescribed Form No. 5 27 was published by the Collector, Vaishali, on the 6th Mar., 1988, which was circulated by a memo No. 194 of the same date, namely, the 6th Mar., 1988, for information to the general public.
10. It is alleged further that the copy of the said sale notification was posted on the notice board of the Collectorate as well as the Sadar Excise Office and further copies of the same were circulated to different officials and agencies. Accordingly, the procedures as laid down in Clause 88 of the Instructions of the Board of Revenue were complied with,
11. It is alleged further that by the said advertisement in the newspaper the Commissioner of Excise only published the dates of auction to be held for the different districts. It is contended that it was not the duty of the Collector, Vaishali, to publish any advertisement in any newspaper and he was not required in law to do so. In any event, the Notice, which was published in the newspaper did not contain the names of the shops to be settled. The proper and correct notification had already been published and circualted earlier on the 6th March, 1988.
12. This writ petition, in our view, could be disposed of at the admission stage and, therefore, ye heard the learned Advocates for the writ petitioner as also for the respondents. Further relevant clauses in the said instructions laying down the procedure for settlement by auction and conduct of auction sales were brought to our notice.
One of the relevant clauses is Clause 95, which reads as follows : --
Clause 95.
"Combination to be guarded against --The presiding officer must be on his guard against a combination of bidders at a sale, and should take steps beforehand to ensure healthy competition and to prevent prices being forced down by a few wealthy monopolists. All legitimate steps must be taken to ensure the attendance at these sales of bidders from outside who may be willing to take and hold excise shops. This duty especially devolves on the Superintendent of Excise."
13. On a reading of the entire procedure laid down by the Board of Revenue for settlement by auction and conduct of auction sales it appears to us that it was the intention of the authorities that the dates for annual settlements and auction sales were required to be fixed by the Commissioner of Excise and communicated to the Collector of Excise who is required to publish them. Further under Clause 88 of the Instructions a sale notification in Form No. 127 is required to be published in vernacular of the District fifteen days prior to the date of commencement of the settlement. Apart from this publication, a copy of sale notification is required to be posted and kept for inspection at the Collectorate and at other places. The same should be publicly notified also in the vicinity of each shop.
14. Clause 95 of the Instructions envisages that the bidders from outside should be encouraged to attend and bid at such auctions and the officers concerned have been particularly directed to ensure that there is no combination of bidders resulting in a lower bid. It is laid down that all legitimate steps should abe taken to ensure the attendance of bidders from outside at the auction sales.
15. In the instant case we have seen the sale notification which was alleged to have been published by the Collector of Vaishali on the 6th Mar., 1988, and circulated by his Memo No. 194 of the same date. All that the memo records is that the copies of the said notification were directed to be sent to different offices for publicity. No material has been brought before us to show in what manner such publicity had been given. In any event, assuming that the officers concerned gave publicity to the said sale notification, such publicity must have been confined to particular localities and the bidders from outside could not be expected to be aware of such publicity.
16. No doubt the statutory procedure does not provide for publication of the notification in the newspapers but such procedure also does not bar or prohibit such publication. The Excise authorities were obviously aware that general publicity should be given of the proposed auction for settlement of shops and in fact there was a publication in the daily newspaper by the excise Department only one day before the last date of submission of applications.
17. Where the object of the statute is to throw open a particular benefit from the State to the members of the public at large and particularly when the statutory procedure provides for wide publicity, in our view, the spirit of the statute will not be upheld if publicity is made only by posting the notification on the notice boards of the Departmental Offices or in selected spots in any particular locality. In our view, this will not result in proper publicity and the outside bidders will be deprived of participating in the settlement by auction. Keeping the relevant information confined within a small area available only to a limited number of people, in our view, is likely to result in malpractice, not to speak of loss of Government revenue.
18. In this connection we may note the following decisions :
(a) Ramana Dayaram Shetty v. International Airport Authority of India, AIR 1979 SC 1628. In this well-known case it was, inter alia, observed by the Supreme Court as follows : --
"It must, therefore, be taken to be the law that where the Government is dealing with the public, whether by way of giving jobs or entering into contracts or issuing quotas or licences or granting other forms of largesse, the Government cannot act arbitrarily at its sweet will and like a private individual, deal with any person it pleases, but its action must be in conformity with standard or norms, which is not arbitrary, irrational of irrelevant. The power or discretion of the Government in the matter of grant of largesse including award of jobs, contracts, quotas, licences etc. must be confined and structured by rational, relevant and non-discriminatory standard or norm and if the Government departs from such standard or norm in any particular case or cases, the, action of the Government would be liable to be struck down unless it can be shown by the Government that the departure was not arbitrary, but was based on some valid principle which in itself was not irrational, unreasonable or discriminatory."
(b) Kasturi Lal Lakshmi Reddy v. State of Jammu and Kashmir, AIR 1980 SC 1992. In this case it was further observed by the Supreme Court as follows : --
".....The Government cannot act in a manner which would benefit a private party at the cost of the State, such an action would be both unreasonable and contrary to public interest. The Government, therefore, cannot for example give a contract or sell or lease out its property for a consideration less than the highest that can be obtained for it, unless of course there are other considerations which render it reasonable in public interest to do so.
(c) Ram and Shyam Co. v. State of Haryana, AIR 1985 SC 1147. In this case the Supreme Court held that any arbitrary action in the matter of distribution of the State largesse by way of easy acceptance of bids from the public must be held by the Courts to be impermissible.
(d) Girija Nandan Singh v. State of Bihar, 1987 Pat LJR 95. In this case the facts found by a Division Bench of this Court were, inter alia, that copies of a notice inviting tenders were only sent by the officer concerned to the Chief Engineer, Minor Irrigation, Director of Industries, Bihar, and to persons described as "main suppliers". The said notice was published in a Patna daily newspaper on the 5th Mar, 1982, and in "a Calcutta daily newspaper on the 9th March, 1982, though the date fixed for opening of the tender was the 5th Mar, 1982. In spite of the late publication of the said notice in the newspapers, the date fixed for receiving tenders and for opening the same were not extended. It was observed on these facts that the conduct of the person publishing the said notice was not bona fide and that he should have extended the date for submission and acceptance of tenders and should have given opportunity to all suppliers intending to submit their tenders so that supply could be made at a more competitive rate.
19. For the reasons as aforesaid, we would have allowed this writ petition and granted the reliefs prayed for by the writ petitioner, but we note that following the auctions one or more bidders must have been given settlements of the shops in Vaishali. They are vitally interested in such settlement at present and it would not be fair if we set aside the settlement in their favour in their absence. Over three months have elapsed since the said shops had been settled and if the successful bidders are now brought on record and allowed to contest the hearing of this petition, there will be further delay and even if the petitioner ultimately succeeds, neither he nor any other successful bidder will get the benefit of the full period of settlement of the shops at Vaishali. Only on this limited ground we refrain from setting aside the settlements which have been impugned in the present proceedings.
20. However, we would like to ensure that similar situations do not arise in future. We direct the respondents to comply with Clauses 87, 88 and 95 of the procedure for settlement by auction and conduct of auction sales effectively in future by publishing in future notice of annual settlements with dates of auctions and also the gist of the sale notification to be published in vernacular in one of the daily newspapers in the State as also in one English newspaper in advance and giving at least two weeks time to the prospective bidders to comply with all formalities and file their applications for settlement or attending auction sales. We further direct that on the expiry of the licence or licences, which might have been issued pursuant to the settlement impugned in these proceedings in respect of the liquor shops in the District of Vaishali, the same must be put up again for settlement and/or auction and the current licences should not be extended by the respondents.
21. The writ petition is disposed of accordingly.