Orissa High Court
Unknown vs Hon'Ble The Chief Justice Mr. Mohammad ... on 8 October, 2020
Bench: Mohammad Rafiq, B.R. Sarangi
W.P.(C) No.16954 of 2020
HON'BLE THE CHIEF JUSTICE MR. MOHAMMAD RAFIQ
HON'BLE DR. JUSTICE B.R. SARANGI
02. 08.10.2020 Mr. K. A. Guru, : For the Petitioner
Advocate
Mr. P. P. Mohanty, : For Opposite Parties
Addl. Govt. Advocate (State of Orissa)
ORDER
Heard learned counsel for the parties by Video Conferencing mode.
2. The petitioner, who is engaged in mining business, has filed this writ petition seeking to quash the order dated 02.01.2020 under Annexure-3 issued by the Principal Secretary to the Government of Odisha in Revenue and Disaster Management Department, and issue direction to the opposite parties to accept the solvency certificate in respect of the tender call notice dated 01.06.2020 under Annexure-2.
3. The factual matrix of the case, as is borne out from the record, is that the petitioner, for last several years, is engaged in mining business. As per Odisha Minor Minerals Concession Rules, 2016, the intending bidders are to submit either solvency certificate or bank guarantee valid for a period of 18 months for an amount not less than the amount of additional charge offered and the royalty payable for minimum guaranteed quantity for one whole year. The aforesaid condition, which is in consonance with Rule 27(4)(iv) of the OMMC Rules, 2016, being a pre-condition for a bidder to take part in the auction of the minor minerals, the petitioner obtained solvency certificate -2- to take part in the auction of sand quarry. But the Tahasildar, Basta-opposite party no.3 on 01.06.2020 floated a tender call notice for auction of different sairats vide Annexure-2 requiring the bidders under clause-4 thereof to furnish bank guarantee in place of solvency certificate, which is in violation of Rule- 27(4)(iv) of the OMMC Rules, 2016.
4. Mr. K.A. Guru, learned counsel for the petitioner contended that as per Rule-27(4)(iv) of the OMMC Rules, 2016, a tenderer can submit a solvency certificate or bank guarantee valid for a period of eighteen months for an amount not less than the amount of additional charge offered and the royalty payable for the minimum guaranteed quantity for one whole year. It is contended that in view such provisions, two types of documents can be submitted in prescribed form, namely, solvency certificate or bank guarantee. If a bidder is willing to submit solvency certificate, in that case, there should not be any insistence to submit bank guarantee.
5. Mr. P.P. Mohanty, learned Addl. Government Advocate appearing for the State opposite parties contended that if rules prescribed for submission of either solvency certificate or bank guarantee, then in that case, if the participant submitted solvency certificate, he should not be insisted upon to produce bank guarantee, in view of the clarification issued by the Government with regard to the same pending finalization of amendment of OMMC Rules, 2016.
6. Having heard Mr. K.A. Guru, learned counsel for the petitioner and Mr. P.P. Mohanty, learned Addl. Government Advocate appearing for the State and after going through the -3- record, in order to appreciate the case, Rule-27(4)(iv) of OMMC Rules, 2016 is extracted hereunder:-
"(iv) a solvency certificate or bank guarantee valid for a period of eighteen months for an amount not less than the amount of additional charge offered and the royalty payable for the minimum guaranteed quantity for one whole year and a list of immovable properties from the Revenue authority."
7. On perusal of the aforementioned provision, it appears that the participant must submit a solvency certificate or bank guarantee valid for a period of eighteen months for an amount not less than the amount of additional charge offered and the royalty payable for the minimum guaranteed quantity for one whole year. Thereby, option has been left to the applicant to submit the solvency certificate or bank guarantee and, as such, the authority cannot insist upon the applicant to submit bank guarantee when another option lies to submit solvency certificate.
8. Government of Odisha in Revenue and Disaster Management Department vide letter dated 30.07.2020, referring to the order dated 19.03.2020 passed by this Court in W.P.(C) No.9726 of 2020 (Sarat Pradhan v. State of Odisha), has clarified that the bid of the highest bidder supported by solvency certificate cannot be invalidated merely on the ground of non-submission of bank guarantee since OMMC Rules, 2016 provides for submission of solvency certificate or bank guarantee. Solvency certificate may be accepted as alternative to bank guarantee in finalization of bids for lease of minor mineral sources till OMMC Rules, 2016 is amended.
-4-9. In the matter of Excise Department, similar question had come up for consideration in Gopinath Sahu v. State of Orissa, (W.P.(C) No. 12518 of 2020 disposed of on 03.08.2020) wherein this Court has already held that the opposite party can act upon the solvency certificate without insisting upon production of bank guarantee.
10. Referring to the judgment passed in Gopinath Sahu mentioned supra, in Narayan Chandra Udgata v. State of Orissa (W.P.(C) No. 17069 of 2020 disposed of on 06.10.2020), this Court also taken a similar view holding that even if the parties do not submit any bank guarantee but submit a solvency certificate, the assessment can be made on the basis of said document. Applying the same to the present context, the Tahasildar, Basta instead of insisting upon the petitioner to produce bank guarantee, shall act upon the solvency certificate submitted by him and proceed with the process of tender in pursuance of the tender call notice under Annexure-2.
With the aforesaid observations and directions, the writ petition stands disposed of.
As Lock-down period is continuing for COVID-19, learned counsel may utilize the soft copy of this order available in the High Court's website or print out thereof at par with certified copies in the manner prescribed, vide Court's Notice No.4587, dated 25.03.2020.
(Dr. B.R. Sarangi) (Mohammad Rafiq)
MP
Judge Chief Justice