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TMI Blog2009 (4) TMI 833X X X X Extracts X X X X X X X X Extracts X X X X ..... 17-4-2009 - PANTA, LOKESHWAR SINGH AND REDDY,B.SUDERSHAN, JJ. JUDGEMENT B.SUDERSHAN REDDY, J. Leave granted. 2. Both these appeals can be dealt with under a common judgment since one and the same issue requires to be decided. The brief facts relevant for the purposes of disposing of these appeals may be stated. 3. Association of Management Studies (for short `AMS') is a Society registered under the provisions of the Societies Registration Act, 1860. It is stated to be managing various educational institutions imparting education such as MBA, MCA, Engineering etc., the details of which are not required to be noted. 4. Meerut Development Authority (for short `MDA') has been constituted as an Authority called as the Development Authority by the U.P. State Government under Section 3 of the Uttar Pardesh Urban Planning and Development Act, 1973. The said Act, has been enacted to provide for development of certain areas of Uttar Pardesh according to plan and for matters ancillary thereto. The main object and reasons for the enactment was to tackle resolutely the problems of town planning and urban development in the State of Uttar Pardesh. FACTUAL MATTERS : 5. O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respect of 20,000 sq.m. of land. AMS in response to the said letter requested the Authority to allot 37,000 sq.m. of land @ Rs.500/- per sq.m. offered by them in their tender. It is noteworthy that AMS in clear and categorical terms stated that the other land of 20,000 sq.m; `may be deleted from ---- offer as the cost of that land is not viable for -. However, we are ready to purchase the same @ Rs.560/- per sq.m. as quoted by us which is the same rate as we have already purchased the part of that land.' 7. MDA having considered the response of AMS vide its letter dated 27.11.2001 informed AMS that only 37,000 sq.m. of land has been allotted for the establishment of engineering college with the condition that the construction of the engineering college is made in accordance with the norms of the A.I.C.T.I.; and deposit of required amounts within the stipulated time. This was accepted by AMS and they took the allotment of only 37,000 sq.mts. of land. In all fairness the matter should have ended there. But it did not. 8. AMS having accepted the offer of 37,000 sq.mts. of land, raised an objection stating injustice has been done by the Authority in fixing the reserved price @ Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Amar Ujala of the said date. (ii) To issue a Writ, Order or direction in the nature of mandamus restraining the respondent from changing the use of the plot of land in question from being used for Engineering college to residential purpose. (iii) To issue a Writ, Order or direction in the nature of mandamus directing the respondent to allot the said plot of land to the petitioner society at the reserved price fixed by it i.e. Rs.690/- per sq.metre and the interest till the payment of the amount by the petitioner or in the alternative direct the respondent to consolidate the two plots of land already demised in favour of the petitioner society into one. (iv) To issue any other suitable writ, order or direction which the Hon'ble Court may deem fit and proper in the circumstances of the case. (v) To award cost of this petition to the petitioner. 11. The High Court vide its interim order dated 07.05.2002, permitted MDA to allot the land in pursuance of the advertisement dated 15.04.2002 but the allotment shall be subject to the decision of this Writ Petition. It shall also be mentioned in the allotment order, if issued by MDA to the allottee. 12. In the auction Pawan Kum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned senior counsel for the respondent - AMS submitted that the decision of MDA in not allotting the land was unreasonable, whimsical, capricious and violative of Article 14 of the Constitution. The decision is not in public interest. MDA committed mistakes in the matter of depiction of rates in the notice inviting tenders as is evident from their supplementary counter affidavit filed in the High Court. There was some confusion as regards reserved price in respect of disputed plot of land which led AMS to offer bid at a lesser rate than the reserved price. It was further submitted that MDA's decision to put the disputed plot of land to reauction in spite of willingness on the part of AMS to pay the reserved price is unsustainable in law. The decision to reauction the land by changing the land use from that of `educational' to `residential' is motivated and inspired by extraneous considerations. Public interest requires allotment of the said land in favour of AMS which is catering the needs of public at large in imparting education in engineering courses. These contentions are culled out from the storms of submissions made during the course of hearing of these appeals. ISSUES RE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e State or its instrumentalities partakes the character of a trust. The methods to be adopted for disposal of public property must be fair and transparent providing an opportunity to all the interested persons to participate in the process. The Authority has the right not to accept the highest bid and even to prefer a tender other than the highest bidder, if there exist good and sufficient reasons, such as, the highest bid not representing the market price but there cannot be any doubt that the Authority's action in accepting or refusing the bid must be free from arbitrariness or favoritism. WHETHER ANY RIGHT OF AMS HAS BEEN INFRINGED ? 19. A mere look at the tender notice in the present case makes it abundantly clear that the two plots of land admeasuring 37,000 and 20,000 sq.mts. meant for establishing engineering colleges were advertised as a single item, though the specified reserved price was different. The reserved price of 20,000 sq. mts. was expressly and clearly mentioned at Rs.690/- per sq.m. There is no ambiguity nor any confusion in this regard. AMS itself mentioned different and separate bids in their tender and made a bid at Rs.560/- per sq.m. for 20,000 sq.mts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sq.m. was under its consideration. Many a letters including the letter dated 03.01.2002 of the Society makes it clear that there was no confusion whatsoever with regard to reserved price fixed at Rs.690/- per sq.m. Once it is clear that there was no vagueness, uncertainty or any confusion with regard to the reserved price there is no scope for any interference in the matter by this court. The terms and conditions of tender were expressly clear by which the authority as well as the bidders were bound and such conditions are not open to judicial scrutiny unless the action of the tendering authority is found to be malicious and misuse of its statutory powers. [See: Tata Cellular vs. UOI [1994 (6) SCC 651], Air India Ltd. vs. Cochin International Airport Ltd. [2000 (2) SCC 617], Directorate of Education vs. Educomp Datamatic Ltd. [ 2004 (4) SCC 19], Association of Registration Plates vs. UOI [2005 (1) SCC 676], Global Energy Ltd. vs. Adani Exports [2005(4) SCC 435] and Purvanchal Projects Ltd. vs. Hotel Venues [2007(10) SCC 33]. 22. The bids offered by AMS received their due attention in a fair and transparent manner free from any bias at the hands of MDA. No rights of AMS have bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of Haryana [1985 (3) SCC 267], Mahabir Auto Stores vs. Indian Oil Corporation [1990 (3) SCC 752], Sterling Computers Ltd. vs. M amp; N Publications [1993(1) SCC 445] and A.B. International Exports vs. State Corporation of India. [2000(3) SCC 553] Executive does not have an absolute discretion, certain principles have to be followed, the public interest being the paramount consideration. It has been stated by this Court in Kasturi Lal's case (supra): It must follow as a necessary corollary from this proposition that 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 sale or lease out its property for a consideration less than the highest that can be obtained from it, unless of course, there are other considerations which render it reasonable and in public interest to do so. The law has been succinctly stated by Wade in his treatise, Administrative Law: The powers of public authorities are therefore essentially different from those of private persons. A man making hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sonable, rational, not arbitrary and violative of Article 14. [See: Sterling Computers Ltd. (supra)]. It may be worthwhile to notice the leading judicial review case in relation to grant of licences, by competitive tender reported in R. vs. Independent Television Commission, ex p. TSW Broadcasting Limited.15 The leading speeches in the House of Lords were delivered by Lord Templeman and Lord Goff. Lord Templeman stated: Where Parliament has not provided for an appeal from a decision maker the courts must not invent an appeal machinery. In the present case Parliament has conferred powers and discretions and imposed duties on the ITC. Parliament has not provided any appeal machinery. Even if the ITC make mistakes of fact or mistakes of law, there is no appeal from their decision. The courts have invented the remedies of judicial review not to provide the appeal machinery but to ensure that the decision maker does not exceed or abuse his powers... But the rules of natural justice do not render a decision invalid because the decision maker or his advisers make a mistake of fact or a mistake of law. Only if the reasons given by the ITC for the decision to reject the applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the general propositions that the authority's action must be free from arbitrariness. It always depends upon the contextual facts. In law, context is everything. We shall bear these parameters in mind and proceed to determine the question whether the decision of the Authority is vitiated by any abuse of power. WHETHER THE DECISION OF THE AUTHORITY IS VITIATED BY ANY ARBITRARINESS AND THEREFORE HIT BY ARTICLE 14 OF THE CONSTITUTION OF INDIA : 27. It was submitted on behalf of AMS that the decision of MDA dated 15.3.2002 undoing its earlier decision dated 7.7.2002 and changing land use of the disputed plot from `educational' to `housing' is unreasonable, unprincipled and capricious and violative of Article 14 of the Constitution. This was done for making higher financial gain and profit and that too, at the instance of an alleged unverified extraneous person overlooking the demands of public interest as well as law and order problems that may arise on account of peculiar location of the plot in the midst of existing higher education campuses belonging to AMS. We find no merit in this submission. The claim of AMS, in our considered opinion came to an end on 17.9.2001 when ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the cost of public welfare has never been considered as legitimate purpose even if the objective is laudable. Sadly the law was thrown to winds for a private purpose. The observations were made in the context where this Court found the entire proceedings before the State Government suffered from absence of jurisdiction. Even the exercise of powers was vitiated and ultra vires. The orders of the Government to convert the site reserved for public park to civic amenity and to allot it for private nursing home was null, void and without jurisdiction and when the same was sought to be justified on the ground of financial gain; the court made the observations in that context. The impugned action of the authority in the present case did not suffer from absence of jurisdiction nor was vitiated and ultra vires. Financial gain was not at the cost of any social welfare. 29. In Padma Vs. Hiralal Motilal Desarda amp; Ors., [(2002) 7 SCC 564] this Court found that CIDCO's decision to part with the chunk of developable land was obviously in departure from the policy of serving on no-profit-no-loss basis to such people as were craving for a roof over their heads. It is in that context the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el for the AMS to characterise the decision of the MDA does not carry any special significance. The real question is whether the decision measures up to the legal standard of reasonableness? The meaning of all such expressions as arbitrary and capricious, frivolous or vexatious is necessarily the same, since the true question must always be whether the statutory powers have been abused? In refusing to accept the tender of the AMS on the ground that the offer made by it was lower than that of the reserved price is legal, valid and by no stretch of imagination can be characterised as an illegal one. In fact, there was no option available to the MDA but to reject the tender of the AMS as the offer made was much below than the reserved price. In fairness, the matter should have rested at that but for the unwarranted repeated representations by the AMS without any lawful claim; the MDA if at all committed an error it was by entertaining such representations and entering into avoidable correspondence with the AMS. CHANGE OF LAND USE : 31. Now, we proceed to deal with the question whether the decision to change the land use is unreasonable? It was submitted that the decision of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on in engineering courses; but it cannot insist the MDA to provide land at the rate chosen by it for itself. The object of the Act under which MDA is constituted was to provide for development of certain areas according to plan and for matters ancillary thereto. It is mainly concerned with an orderly development of the areas and balanced use of the available land within the development area. The Authority in law is not entitled to gift or freely make available any land or at a rate lesser than that of reserved price. The MDA in terms of the directions of the Government vide G.O. dated 19.04.1996 has already decided to make the lands available to the institutions imparting education in engineering at a concessional rate i.e. to say 50% of the sector rate and accordingly fixed reserve price @ Rs. 690/- per sq. meter. The public interest parameters have been duly taken into consideration by the Government itself in directing MDA to make the lands available to educational institutions at a concessional rate. It is difficult to appreciate as to what more the AMS expects from the Authority. The Society in fact availed that assistance from MDA on an earlier occasion but failed to avail ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. The expression `public interest' if it is employed in a given statute is to be understood and interpreted in the light of the entire scheme, purpose and object of the enactment but in the absence of the same it cannot be pressed into service to confer any right upon a person who otherwise does not possess any such right in law. In what manner this Court has to arrive at any conclusion that MDA's decision in calling for fresh tender from the interested persons for making the land available for residential use is not in public interest? Repeated attempts were made before us to say that providing the land in question for educational use will be more appropriate and sub-serve public interest than making it available for residential use. Public interest floats in a vast, deep-ocean of ideas, and imagined experiences . It would seem to us wise for the courts not to venture into this unchartered minefield. We are not exercising our will. We cannot impose our own values on society. Any such effort would mean to make value judgments. The impugned judgment illustrates the danger of judges wrongly though unconsciously substituting their own views for the views of the decision maker who ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he auction would be subject to further orders to be passed in the writ petition. The fact remains there was no demand from MDA requiring the appellant to pay any amount nor did the appellant on his own deposited any amount towards installments except requesting the MDA to initiate proceedings for transferring the land. The MDA informed the appellant that it was making efforts to get the writ petition decided and the letter of allotment would be issued only after the disposal of the writ petition. 37. AMS challenged the fresh advertisement in which the appellant was the highest bidder but without impleading the appellant. Number of affidavits and supplementary affidavits were exchanged between the parties in the High Court. On 2.4.2007, the High Court allowed impleadment application of the appellant-Pawan Kumar Agarwal. During the course of hearing, the High Court on 8.5.2007 directed the Vice- Chairman, MDA to file additional affidavit inter alia explaining as to why allotment in favour of appellant-Pawan Kumar Agarwal was not cancelled when it has deposited only earnest money and not the balance of total consideration and whether the earnest money could be forfeited by MDA? MDA, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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