ALAULI ANCHAL BOAT TRAFFIC COOPERATIVE SOCIETY LTD., PHULTORA AND ANR. versus STATE OF BIHAR AND ORS.

Citation: [2016] 2 S.C.R. 83 · Decided: 26-02-2016 · Supreme Court of India · Bench: T.S. THAKUR

Judgment (excerpt)

(2016] 2 S.C.R. 83 
ALAULI ANCHAL BOAT TRAFFIC COOPERATIVE SOCIETY 
A 
LTD., PHULTORA AND ANR. 
v. 
STATE OF BIHAR AND ORS. 
(Civil Appeal No.1853 of2016) 
FEBRUARY 26, 2016 
[T. S. THAKUR, CJI, A. K. SIKRI AND R. BANUMATHI; 
JJ.] 
B 
Auction - Auction-purchase - Challenge to - Propriety of -
C 
Auction· of a Ghat - Highest bid amount was Rs.16, 00, 0001- -
Though the appellant-society did not participate in the auction -
Its opinion was sought on the highest bid - The Society accepted 
the bid for Rs. 16, 00, 0001- under protest - Contract of the Ghat 
granted to the society - The society challenged the order inviting 
the open bid by public auction for settlement of the Ghat and also 
D 
bid amount by filing writ petition - Single Judge of High Court 
remitted the matter to the authorities cuncemed to reconsider the 
matter - LPA of the State was allowed by the Division Bench of 
High Court - On appeal, held: In the facts of the case, auction 
process inviting bids in settlement of ghats cannot be said to be 
E 
arbitraq or in violtition ·of Government Circulars - Bid of 
Rs:16,00,000!- had a rationale behind it being the highest bid -
The ghat in question was not the only ghat for which auction was 
held - The Society had offered even higher bid amount in respect 
of other ghats and was declared successfiil bidder - Thus, there· is 
not justifiable reason to challenge either the auction or the bid 
F 
amount. 
Dismissing the appeal, the Court 
HELD: It emerges from the record that the reason for 
auctioning the ghat in q-uestion was that the Circle Officer had 
accepted the recommendation of the District Level Committee G 
and acted as per the Government instruction vide letter No.2526 
dated 12.09.1978 to go through open auction process which is 
mandatory for the settlement of the ghats for every third year. As 
per the recommendation of the District Level Committee, in order 
to augment the State revenue, the authorities are expected to 
H 
83 
84 
A 
B 
c 
D 
E 
F 
G 
H 
SUPREME COURT REPORTS 
[2016] 2 S.C.R. 
invite bids through auction process and ensure transparency in 
acceptance of the bids. The auction process inviting the bids in 
the settlement of ghat cannot be said to be arbitrary or in violation 
of Government circulars. (Para 9) (88-B-C] 
2. In auction, the highest bid received was of Rs.16,00,000/ 
-. Further, the appellant-society was not a bidder and did not 
participate in the auction. However, still it was offered to have 
the ghat settled in its favour on payment of Rs.16,00,000/- which 
was the highest bid received. It agreed to do so but accepted 
the bid under protest. There is no justifiable reason to ch,allenge 
either the auction or the aforesaid bid amount. The amount of 
Rs.16,00,000/- had a rationale behind it as it was the highest bid 
and, therefore, having agreed to take the settlement of ghat for 
Rs.16,00,000/- the appellant-society was not justified in 
challenging the auction of ghat by inviting bids. More so, Ghat in 
question was not the solitary ghat in which the auction has been 
held but other ghats were also auctioned and settled at much 
higher amounts. In fact, the appellant-society was successful in 
offering the highest bid amount for other ghats at Rs.20,00,000/ 
-. Having participated and having emerged as the successful 
bidder for other ghats, the appellant-society is not justified iu 
challenging the auction iuvitiug open bids for the Ghat in question. 
The Division Bench rightly observed that every year the amount 
of bid has gone up and therefore, the Court has no jurisdiction to 
go into such disputed questions of fact with regard to bid amouut. 
(Paras 9 and 151 188-D-F; 90-E) 
3. Contention of the appellant society is that in view of 
various circulars of the Government, the upward revision of 
reserve Jama could only be fifteen percent of the reserve Jama/ 
settlement amount for the previous years and the bid amount of 
Rs.16,00,000/- for the ghat in question is arbitrary and un-
reasonable. When the decision was taken to go through the open 
auction process which was even otherwise justifiable in order to 
augment the State revenue, the appellant-society cannot object 
to the same and claim the settlement of ghat in its favour on 
payment of 15% of the reserved Jama/settlement amount for the 
previous years. In fact, such a contention is not even available 
to the appellant-society inasmuch as the decision of the 
respondents to go through th.e auction pr

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