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TMI Blog2008 (10) TMI 719X X X X Extracts X X X X X X X X Extracts X X X X ..... vant terms of the said tender were: 6. The tender/bidder should make arrangements to obtain transit permit at his own cost from Forest Department/KSFIC. 9. The successful Tenderer/Bidder should pay 1/10th amount of the sale value plus taxes as follows: (a) Un-polished Granite Blocks 10% S.T. (b) Sur-charge on S.T. 15% (c) Forest Development Tax 5% (d) Income Tax 15% (e) Surcharge on I. Tax 5% On the same day, the balance amount will be payable as follows: (a) 50% within 15 days of the intimation of confirmation of tender. (b) the remaining amount shall be paid by the end of the June, 1995 or before the stones are lifted whichever is earlier. The period of the contract shall be upto April, 30th 1995. 11. In case of breach of any of the conditions mentioned above, the Managing Director, KSFIC Ltd., is at liberty to cancel the Tender/Bid amount and make materials at the risk and cost of the original Tenderer/Bidder and the EMD/Security Deposit furnished by the Tenderer/Bidder be forfeited. If the K.S.F.I.C. incurs any extra expenditure in this regard the same will be recoverable from the original Tenderer/Bidder. 18. The successful Tenderer/Bidder s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to pay the amount to which it was said to be otherwise liable in terms of Clause 8 of the terms and conditions of the tender. 7. There appears to be a dispute as regards the amount payable by the respondent on the aforementioned account insofar as whereas according to the appellant the amount of granite including tax and other statutory liabilities in respect of 10 blocks of granite which had been received by the respondent and transported by it is ₹ 3,25,193.90; according to the respondent, the total amount of goods received was ₹ 2,39,969.35. Appellant contended that the contract was not concluded within the stipulated period of time as the entire payment was not made by June, 1995 or before lifting of the stones whichever is earlier, as envisaged under Clause 9(b) of the terms and conditions of the tender. 8. Concededly the Government of Karnataka was approached. A question was also raised in the Legislative Assembly. The Principal Secretary, Forest, Ecology and Environment Department, Government of Karnataka issued a letter on or about 16.01.1996, which reads as under: Sub: Permission to Karnataka State Forest Industries Corporation Ltd., for the sale of Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd also to return the amount (liable to be refunded) to the concerned bidders, which is already collected from them. But, it has further directed to preserve the granite stones safely till the decision of the Joint House Committee. 10. It is, however, stated that the appellant did not agree to the aforementioned suggestions/direction of the State and responded thereto stating that it was not feasible to refund the sale price. It had been stated that necessary permit should be directed to be issued in this behalf. By its letter dated 2.12.1996, appellant requested the respondent to remit the balance amount, stating: You are requested to remit the balance amount of the total purchase value of the Granite Blocks purchased by you in the auction sale conducted by the KSFIC Ltd. during the Month of March - 1995. 11. However, the said request was not acceded to. Appellant allegedly issued various other letters to the same effect on 29.01.1997, 25.04.1997 and 30.06.1997. Ultimately by its letter dated 5.06.1999, the appellant informed the respondent to immediately remit the amount and lift the granite blocks by 30.06.1999 failing which, it was threatened, the amount deposited shal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e entrustment of selling of the seized and confiscated granite blocks in favour of the Respondent Corporation should be dispensed forthwith thereby terminating the agency given to the Respondent. The Government on the instructions of the Legislators Committee cancelled the agency that was given to the Respondent and instructed the forest corporation to return the granite blocks to the department of Mines and Geology (sic) is the owner of those Granite blocks. Only for the purpose of selling those granite blocks it was entrusted to the Respondent Corporation. The Corporation ceased to have its power or jurisdiction to continue to sell the granite blocks with effect from 16.01.1996. The true copy of the Government Notification dated 16.01.1996 is produced herewith as ANNEXURE-C. In the aforementioned premise, it was inter alia prayed : b) ISSUE an order, direction or writ in the nature of Mandamus, directing the Respondents to implement the Government Order Annexure-C dated 16.01.1996. c) ISSUE an order, direction or in the nature of mandamus, directing the Respondents to refund sum of ₹ 9,44,478.55 together with interest calculated at 18% in terms of the Government o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods sold, called upon the agent to refund the excess amount. The agent has to abide by the instructions of the Principal. He has to deal with the estate of his principal as he commands. 9. A perusal of Annexure H shows that the Respondent has collected whatever tax is due under the sale and prima facie there is no scope for fresh demand. Besides, the petitioner cannot also dispute its liability to pay the stipulated tax, it being a condition of sale. In these circumstances, there is a no justification in the demand made by the Respondent in Annexure H. In such circumstances, Annexure H is quashed. There will be direction to the Respondent to refund the amount, a sum of ₹ 3,75,905.35 with the interest from the date of Annexure C. The right of the Respondent to claim any damage sustained from its principal is left open. W.P. is disposed of. 16. A writ appeal preferred there against by the appellant has been dismissed by reason of the impugned judgment. Civil Appeal arising out of SLP (C) No. 23148 of 2005 17. Respondent No. 3, on 6th March, 1995, participated in the tender-cum- auction sale and was a successful bidder in respect of 3 lots of granite containing 75 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respondent Corporation to consider the request that may be made by the petitioner - Company for refund of a sum of ₹ 1,51,594.06 ps., if terms and conditions of tender-cum-auction sale notification permits for such refund within two months from the date of request that may be made by the petitioner company and secondly, if the petitioner company deposits the balance of sale consideration for purchase of granite blocks, the respondent-corporation is directed to lift the balance or rough granite blocks which it had purchased in the auction sale without insisting on the payment of interest on the balance of amounts or for production of proof of payment of royalty under KMMC Rules, 1994. The High Court also opined : Pursuant to such confirmation of sale, Petitioner- Company has already lifted granite blocks worth ₹ 4,40,562.50 ps. and the taxes paid in full on the entire sale value has already been deposited with the State and Central Government. Therefore submits, the only amount that is remaining with the third respondent- Corporation is a sum of ₹ 1,51,554.05 ps. The learned counsel further submits that the third Respondent-Corporation is prepared to refund ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing of the earlier Writ Petition, the Petitioner had lifted 29 granite blocks. It is submitted that the application produced at Annexure-G is not brought to the notice of this respondent. It appears to have been rejected as the Petitioner did not pay the balance consideration towards 85 granite blocks and consequently as this respondent also could not pay the same to the fourth respondent. 11. IN REPLY TO PARA-8: Out of ₹ 11,47,149.32 paid by the petitioner a sum of ₹ 5,62,063.25 is towards the applicable taxes. What remains is ₹ 5,85,086.07 which is to be adjusted towards the value of the granite blocks. Out of this the Petitioner has already lifted 176.225 Cmt. of granite blocks in Yadamarahalli- III worth ₹ 4,40,562.50 ps. The remaining amount is ₹ 1,51,594.05. In the absence of any indication by the petitioner, this amount cannot be adjusted to any of the remaining lots. As the petitioner has not indicated to which lot this amount has to be adjusted, the question of releasing the granite blocks corresponding to the payment does not arise at all. It is incorrect to say that the petitioner has deposited the necessary amount without any lapses. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould exercise its discretionary jurisdiction even in a matter governed by contract qua contract. (ii) The action of the State in all situations including contractual matters must be fair and keeping in view the fact that the appellant had taken a wholly unfair stand, this Court should not interfere with the impugned judgment. (iii) In any event, as in the appeal arising out of SLP (C) No. 23148 of 2005 the appellant itself agreed to refund a sum of ₹ 1,51,554.05 it cannot be permitted to go back on its promise and refuse to enforce the same particularly when the other respondents against whom directions had been issued, including the State of Karnataka and income tax authorities have accepted the judgment. 29. Indisputably the confiscated granite blocks belonged to the State of Karnataka. They did not belong to the appellant-Corporation. Appellant was merely appointed as an agent of the State. It is only in that capacity the tender was issued by it. We may notice that although in terms of the said tender, the concerned respondents and Ors. were bound to deposit the price of the granite blocks as also the amount of tax payable thereunder ; one of the essential conditi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respondents herein, even assuming that they were so, they would not prevail over the public documents which are the brochures, commercial information and the tariffs. 33. To the same effect are the observations made by this Court in New Bihar Biri Leaves Co. and Ors. v. State of Bihar and Ors. [1981]2SCR417 , stating: 46. At the time of inviting Tenders in the prescribed Form or inviting purchasers to bid at the publication, all tenderers or bidders are treated equally in the sense that they can offer their rates or bids subject to the statutory conditions including the impugned provisions. While accepting the highest Tender of rates per standard bag or the highest bid, it is not possible to classify the purchasers whose offers/bids have been accepted into 'honest' purchasers and 'dishonest' purchasers. Everybody whose offer or bid is accepted, is assumed to be honest. 34. We are, however, concerned herein with a different situation. Transport of granite blocks was subject to issuance of transit permits. Such transit permits are granted in terms of the provisions of Rule 42 of the Karnataka Minor Mineral Concession Rules, 1994. 35. The question that aris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts for the remaining Blocks to KSFIC Ltd. as per the rules in force. There is no alternative left for the KSFIC Ltd. to make arrangement for issue of transit permits through Mines and Geology Department to the purchasers for lifting the remaining blocks purchased by them in Tender cum auction sale as the KSFIC Ltd. Is totally unable to refund the deposit amount to the purchasers in the circumstances explained above. But there is nothing to show that the Government of Karnataka acted thereupon or withdrawn its direction contained in its letter dated 16th January, 1996. 37. The plea which was raised, therefore, was not a legal plea but a plea for show of compassion expressing its inability to refund the amount because of financial constraints. Its response to the State was not based on legal premise but it was based on its own difficulty. If the agency had been terminated and had not been restored, we would not know under what authority the appellant had been asking respondents to perform their part of contract. 38. In any view of the matter there is nothing on the records to show that the State of Karnataka and particularly the Joint Committee of the Karnataka Legislative A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion made by the counsel for appellants in the earlier round of litigation also cannot be lost sight of. A specific concession was made. It may be that no specific direction was issued by the High Court therein, but the stand taken by it was clear and unequivocal. 43. Mr. Shyam Divan, when questioned, had very fairly submitted that the conduct of the counsel who had appeared on behalf of the appellant in the earlier round of litigation is not in question and it cannot be said that he acted beyond his authority. 44. If such a stand had taken in the earlier round of litigation we fail to see any reason as to why the concession made by it should not be given effect to. If a right has accrued to the respondents for maintaining a writ so as to compel the State to give effect to an earlier order passed by the Court as has been held by this Court in the case of Commissioner, Karnataka Housing Board v. C. Muddaiah AIR2007SC3100 , the same should not be denied to respondent herein. 45. Keeping in view the facts and circumstances of the case in its entirety and having regard to the legal propositions as noticed hereinbefore, we are of the opinion that these are not the cases in whic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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