NAND KISHORE SARAF versus STATE OF RAJASTHAN AND ANOTHER

Citation: [1965] 3 S.C.R. 173 · Decided: 24-02-1965 · Supreme Court of India · Bench: P.B. GAJENDRAGADKAR · Disposal: Dismissed

Cited by 1 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

A 
B 
c 
D 
E 
F 
G 
NAND KISHORE SARAF 
v. 
STATE OF RAJASTHAN AND ANOTHER 
February 24, 1965 
(P. B. GAJENDRAGADKAR, C.J., RAGHUBAR DAYAL AND 
V. RAMASWAMI, JI.) 
173 
Rajasthan Minor Mineral Concessio~ Rules, 1959, Rules 36(7), ~9-
Auction for the grant of royalty collection cantract-Whether obltaa.-
tor11 on Government to accept highest bid-Whether prefere~e ca" 
be shown t.o workers' coope~ative societies against highest bidder. 
The appellant offered the highest bid at the auction for the grant 
of royalty collection contract on January 21, 1964. Re~pondent No. a 
a cooperative society of workers was also one of the bidders. Respon-
dent No. 2 made an application on March 5, 1964 to the Government 
stating therein that the appellant had not deposited 25 per cent of 
the bid amount as security within the time prescribed by Rule 36(~) 
of the Rajasthan Minor Mineral Concession Rules, 1959, and that it 
was prepared to toke the royalty collection contract on the highest 
bid as made by appellant. On the above application the State Govern-
ment made an order in favour of Respondent No. 2. The appellant 
thereupon filed a writ petition. in the High Court which was dismiss-
ed. He was however granted a certificate of fitness. 
In appeal it was contended that the Government had merely tB 
confirm the highest bid at the auction by way of formality and was 
not competent to sanction the contract in favour of someone who ilad 
not offered the highest bid at the auction. 
HELD : (i) The appellant had admittedly failed to deposit ~ per 
cent of the bid as security in compliance with the provisions of Rule 
36(7). The rules did not contemplate adjustment of security deposited 
for an earlier period as the appellant claimed. He therefore lost what.-
ever claim he could have had for the final acceptance of his bid by 
Government and therefore could not question the grant of the con-
tract to any other person by th" Government. [175 B-C] 
(ii) Nothing in Rule 36 requires the Government to accept 
the highest bid by formally confirming it. The Government has dis-
cretion to confirm the bid or not to confirm it. Further Rule 59 pro-
vides for the relaxation of any provision of the rules in the interest 
of mineral development or better working of the mines. [176 A-BJ 
(iii) The view taken by the Government in preferring Respon-
dent No. 2 to the appellant cannot be said to be arbitrary or without 
any justification. The cooperative society is of the labourers who 
work in the mines and the benefit of the contract would go to the 
labourers. In view of the spirit underlying Rule 59, Government 
could therefore relax any such rule which could in any way come 
in the way or i:ts granting the contract to Respondent No. 2. 
[176 D-Fl 
(iv) The time for .which the contract was granted was shortly to 
R 
come to an end, and •t would not be desirable even if the appellant 
was right to interfere with the contract. fl'76 Gl 
K. N. Guruswamy v. State of Mysore, [19551 1 S.C.R. 305, relied 
on. 
C1VIL APPELLATE JuRISDICTJON: Civil Appeal No. 79 of 1965. 
Appe~I from t!ie judgment and order dated August 5, 1964, 
of the Ra1asthan High Court, Jodhpur, in D.B. Civil Writ Petition 
No. 636 of 1964. 
J,/B(D)BCI-13 
IH 
8UPREMll 
COURT 
MPORTI! 
[1965] 3 s.o.e.. 
Sarjoo Prasad, /. B. Dadachanjl, 0. C. Mathur and Ravinder A 
· Narain, for the appellant. 
M. M. Tewari, K. K. Jain and R. N. Sachthey, for respondent 
No. I. 
B. B. Tawak/ey and K. P. Gupta, for respondent No. 2. 
The Judgment of the Court was delivered by 
B 
Raghubar Dayal, J. This appeal, on certificate granted by the 
Rajasthan High Court, is against the dismissal of the appellant's 
writ petition under Art. 226 of the Constitution praying for the 
issue of a writ of certiorari to the State of Rajasthan, respondent 
no. I, for the cancelling and setting aside of its order dated April I, c 
1964 granting the contract for collecting royalty on building stones 
excavated from certain area to respondent no. 2, Dharti Dan 
Shramik Theka Sahkari Samiti Ltd., a cooperative society. The 
appeal arises in these circumstances. 
The appellant offered the highest bid at the auction for the D 
grant .of royalty collection contract on January 21, 1964. Respon-
dent no. 2 was also one of the bidders, but stopped after offering 
a bid of Rs. 33,000. The final bid of the appellant was for 
Rs. 42,200. The State Government made the order in favour of 
respondent no. 2 on an application made by it o

Excerpt shown. Read the full judgment & AI analysis in Lexace.