2000 (12) TMI 928

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..... hall by registered letter request the Executive Engineer concerned for such extension and provided that payment upto the date of such application have been received by the Executive Engineer regularly and there have been no default of any of the terms and conditions herein contained. The decision as to whether there has been any default or not on the part of the agency shall rest with the Executive Engineer, and shall be binding on the agent. 3. The respondent requested the Executive Engineer concerned for extension of the agency for a period of another one year in terms of Clause 5 of the agreement having complied with the conditions stated therein. The appellant having invited fresh bids for appointment of the agent to collect toll or .....

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..... , involved an element of legitimate exception and non-consideration of the same would amount to arbitrary exercise of the power and, therefore, the learned single Judge was justified in issuing the writ. The Division Bench took the view that Clause 5 of the agreement provided for extension of the period of agency though not renewal, and inasmuch as the conditions imposed in respect of such extension had been fulfilled, it was not a case involving grant of a fresh agency but extension of the existing one and relied upon a decision of this Court in Food Corporation of India v. Kamdhenu Cattle Feed Industries AIR1993SC1601 , and upheld the order made by the learned Single Judge. Hence this appeal. 4. We may notice that the distinction so .....

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..... n any principle which detracts from what we have stated now. In a case where the agency is granted for collection of toll or taxes, as in the present case, it can be easily discerned that the claim of the respondent for extension of the period of the agency would not come in the way of the Government if it is economically more beneficial to have a fresh agreement by enhancing the consideration payable to the Government. In such an event, it cannot be said that the action of the Government inviting fresh bids is arbitrary. Moreover, the respondent can also participate in the tender process and get his bid considered. Hence, we do not think that the view taken by the High Court can be justified. 5. We set aside the order made by the Divisi .....

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