Dismissed

M/S K.B. Arts and Crafts v. the Rajasthan Industrial Development and Investment Corporation Ltd. (Riico)

Rajasthan HC27 Oct 2021SAW/598/2021

Case brief

AI extract

What is this about?

The High Court dismissed appeals against the rejection of industrial plots in an e-auction. The court held that the authority's right to accept or reject bids, even the highest, was validly exercised as the single bids were non-competitive compared to multiple higher bids for other plots.

What did the court decide?

All writ appeals were dismissed; the impugned orders were upheld.

M/S K.B. Arts and Crafts Vs the Rajasthan… — Contract and Commercial Disputes | Rajasthan HC (2021)

¶1

HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR

¶2

D.B. Spl. Appl. Writ No. 599/2021

¶3

Rohit Burad S/o Shri Praveen Burad, Aged About 36 Years, By Caste Jain, R/o 22, Nehru Park, Jodhpur.

¶4

----Appellant

¶5

Versus

¶6

The Rajasthan Industrial Development And Investment Coropration Ltd. (Riico), Through Managing Director, Riico Ltd, Udhyog Bhawan, Tilak Marg, Jaipur.

¶7

The Regional Manager, Rajasthan State Industrial Development And Investment Corporation Ltd., Pali, District Pali (Raj.)

¶8

----Respondents

¶9

D.B. Spl. Appl. Writ No. 600/2021

¶10

Naman Bhansali S/o Shri Ravindra Bhansali, Aged About 20 Years, By Caste Jain, Resident Of 3, Bhagat Ki Kothi Extension, Jodhpur.

¶11

----Appellant

¶12

Versus

¶13

The Rajasthan Industrial Development And Investment Corporation Ltd., (Riico), Through Managing Director, Riico Ltd, Udhyog Bhawan, Tilak Marg, Jaipur.

¶14

The Regional Manager, Rajasthan State Industrial Development And Investment Corporation Ltd., Pali, District Pali (Raj.)

¶15

----Respondents

¶16

D.B. Spl. Appl. Writ No. 601/2021

¶17

Rohit Jindal, By Caste Agarwal, Resident Of 85, Roop Rajat Township Phase Ii, Pal Road, Jodhpur.

¶18

----Appellant

¶19

Versus

¶20

The Rajasthan Industrial Development And Investment Corporation Ltd., (Riico), Through Managing Director, Riico Ltd, Udhyog Bhawan, Tilak Marg, Jaipur.

¶21

(2 of 8)

¶22

[SAW-599/2021]

¶23

The Regional Manager, Rajasthan State Industrial Development And Investment Corporation Ltd., Pali, District Pali (Raj.)

¶24

----Respondents

¶25

D.B. Spl. Appl. Writ No. 602/2021

¶26

Prakash Pemaram Choudhary S/o Pema Ram, Aged About 33 Years, By Caste Choudhary, Resident Of Room No. C-2, 2Nd Floor, Pushpanjali Residency, Near Aashirwaad Hospital, Bhayandar East, Thane (Maharastra)

¶27

----Appellant Versus

¶28

The Rajasthan Industrial Development And Investment Corporation Ltd. (Riico), Through Managing Director, Riico Ltd, Udhyog Bhawan, Tilak Marg, Jaipur.

¶29

The Regional Manager, Rajasthan Industrial Development And Investment Corporation Ltd., Pali, District Pali (Raj.)

¶30

----Respondents

¶31

D.B. Spl. Appl. Writ No. 596/2021

¶32

Dinesh Baheti S/o Shri Sunder Lal Baheti, Aged About 41 Years, By Caste Maheshwari, Resident Of 80, Narpat Nagar, Pal Road, Jodhpur.

¶33

----Appellant

¶34

Versus

¶35

1. The Rajasthan Industrial Development And Investment Corporation Ltd. (Riico), Through Managing Director, Riico Ltd, Udhyog Bhawan, Tilak Marg, Jaipur.

¶36

The Regional Manager, Rajasthan State Industrial Development And Investment Corporation Ltd., Pali, District Pali (Raj.).

----Respondents

(3 of 8)

[SAW-599/2021]

D.B. Spl. Appl. Writ No. 597/2021

¶41

Rohit Burad S/o Praveen Burad, Aged About 36 Years, By Caste Jain, Resident Of 22, Nehru Park, Jodhpur.

¶42

----Appellant

¶43

Versus

¶44

The Rajasthan Industrial Development And Investment Corporation Ltd. (Riico), Through Managing Director, Riico Ltd, Udhyog Bhawan, Tilak Marg, Jaipur.

¶45

The Regional Manager, Rajasthan State Industrial Development And Investment Corporation Ltd., Pali, District Pali (Raj.)

¶46

----Respondents

¶47

Connected With

¶48

D.B. Spl. Appl. Writ No. 598/2021

¶49

M/s K.b. Arts And Crafts, A Proprietorship Concern Through Its Proprietor Kunj Bihari Son Of Shri Ramavatar Agarwal, Aged About 40 Years, F 311-312 Iind Phase, Basni, Jodhpur.

¶50

----Appellant

¶51

Versus

¶52

The Rajasthan Industrial Development And Investment Corporation Ltd. (Riico), Through Managing Director, Riico Ltd, Udhyog Bhawan, Tilak Marg, Jaipur.

¶53

The Regional Manager, Rajasthan State Industrial Development And Investment Corporation Ltd., Pali, District Pali (Raj.)

¶54

----Respondents

¶55

D.B. Spl. Appl. Writ No. 603/2021

¶56

Dheeraj Gandhi S/o Shri Roop Kishore Gandhi, Aged About 50 Years, By Caste Maheshwari, R/o 180, Dhoot Bhawan, Ist C Road, Sardarpura, Jodhpur.

----Appellant

Versus

(4 of 8)

[SAW-599/2021]

The Rajasthan Industrial Development And Investment Corporation Ltd. (Riico), Through Managing Director, Riico Ltd, Udhyog Bhawan, Tilak Marg, Jaipur.

¶62

The Regional Manager, Rajasthan State Industrial Development And Investment Corporation Ltd., Pali, District Pali (Raj.)

¶63

----Respondents

¶64

D.B. Spl. Appl. Writ No. 604/2021

¶65

Rishi Jain S/o Shri Narendra Mal Jain, Aged About 22 Years, By Caste Jain, Resident Of 19, Mahaveer Nagar, Near Govt. Polytechnic College, Jodhpur.

¶66

----Appellant

¶67

Versus

¶68

The Rajasthan Industrial Development And Investment Corporation Ltd. (Riico), Through Managing Director, Riico Ltd, Udhyog Bhawn, Tilak Marg, Jaipur.

¶69

The Regional Manager, Rajasthan State Industrial Development And Investment Corporation Ltd., Pali, District Pali (Raj.)

¶70

----Respondents

¶71

For Appellant(s) : Mr. Himanshu Maheshwari. Mr. Dinesh Kumar Sharma. For Respondent(s) : Mr. Sanjeet Purohit.

¶72

HON'BLE THE CHIEF JUSTICE MR. AKIL KURESHI HON'BLE MR. JUSTICE SANDEEP MEHTA

¶73

Judgment

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27/10/2021

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These appeals arise out of a common background and are directed against the common judgment passed by the learned Single Judge dated 13.09.2021 involving similar issues of facts

¶76

(5 of 8)

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[SAW-599/2021]

¶78

and law. For convenience, we may refer to the facts arising in Spl. Appl. Writ No. 599/2021.

¶79

The appellant-original petitioner had applied for e-auction in response to the notice issued by the RIICO on 04.09.2020 for allotting industrial plots in Naya Goan, Pali area. The reserved price for the plots in question was fixed at Rs. 1200 per sq. mtrs. There were several bids for individual plots, however, for the plot which the petitioner had made his offer, he was the sole bidder. He had offered rate of Rs. 1210 per sq.-mtrs. Several similar instances of single bid making offer for the individual plots also came to the notice of RIICO authorities. The RIICO decided to reject all these offers and returned the earnest money deposited. Thereupon, the petitioner approached this Court by filing Civil Writ Petition No. 249/2021 and challenged the decision of the authorities.

¶80

In brief, the case of the petitioner was that the petitioner’s bid was higher than the offset price fixed by the RIICO and was wrongly rejected on the ground that the petitioner was the sole bidder. The petitioner relied on the case of one Ankit Burad, in whose case, the bid offer dated 24.07.2020 through e-auction process was accepted by RIICO by order dated 10/11^th September, 2020, though he was also the sole bidder and had offered the rate of Rs. 1210 per sq. mtrs.

¶81

Before the learned Single Judge, the respondents authorities appeared and filed a detailed reply inter-alia pointing out that the auction notice itself specified that it was not compulsory for RIICO to accept the bid simply because it is the highest bid. The case of the petitioner and other similarly situated bidders was placed before a Committee. The Committee noted that higher multiple

¶82

(6 of 8)

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[SAW-599/2021]

¶84

bids were received during the same auction and therefore single bids received from the petitioner and other similarly situated bidders were not competitive. It was on these grounds, that the bid of the petitioner and other single bidders were rejected.

¶85

The learned Single Judge relied on the judgment of the Supreme Court in case of Haryana Urban Development Authority and Others Vs. Orchid Infrastructure Developers Private Limited ((2017) 4 SCC 243) and a decision of the Division Bench of this Court in the case of Komal Aggrawal Vs. State of Rajasthan in D.B. Spl. Appl. Writ No. 274/2012 and dismissed the petition by making following observations:-

¶86

“Heard learned counsel for the parties and perused the record.

¶87

These writ petitions have been filed by the petitioners deserves to be dismissed for the reasons firstly the petitioners have participated in the e-auction proceeding after reading the terms and condition of the auction and as per the terms and condition of the auction, the RIICO reserves right to cancel the highest bid offered by the petitioners. Secondly, the Auction Committee considered the fact that the higher multiple bids have been received in the same auction for another plots, therefore, the single bid offered by the petitioners does not seems to be competitive. Thirdly, in view of the judgment passed by the Hon’ble Supreme Court in the matter of Haryana Urban Development Authority (supra) as well as Division Bench of this Court in the matter of Komal Aggarwal (supra), I am not inclined to exercise the jurisdiction of this Court under Article 226 and 227 of the Constitution of India in these matters.

¶88

Hence, these writ petitioners are dismissed.”

¶89

Having heard learned counsel for the parties and having perused the documents on record, we do not find that the appellant has made out any case for interference. It is undisputed position that the auction notice itself specified that the RIICO reserves the right to accept the bid. The circular issued by the Rajasthan State Industrial Development and Investment

¶90

(7 of 8)

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[SAW-599/2021]

¶92

Corporation Ltd. also specifies that reserved rate should not be the only criteria while finalizing the highest bid. Even otherwise, it is well settled principle by the judgments of the Supreme Court that a person participating in the auction does not have a vested right for the offer to be accepted, simply because it happens to be the highest bid. The authority inviting offers reserves the right to accept or not to accept the bid even if the same happens to be the highest offer. Such right, of course, has to be exercised reasonably and cannot be a matter of arbitrary exercise of pick and choose.

¶93

In the present case, the RIICO authorities have placed full material on record justifying its action of canceling the bids. It is pointed out that in large number of cases, multiple bids of much higher value were offered for adjacent plots. Whereas in some of the cases, there were single bids and the price offered was marginally over the offset price. The analysis placed before the Court along with the affidavit filed, would show that other plots were auctioned at the rate of Rs. 1330 per sq. mtrs. to Rs. 1790 per sq. mtrs. which was substantially higher than the bid offered by the petitioner at Rs. 1210 per sq. mtrs.

¶94

The acceptance of the offer of Sh. Ankit Burad was explained by the learned counsel for the respondent-RIICO by pointing out that it was the first instance of inviting bids from the members of the public in the industrial area in question. The petitioner had participated in the subsequent bids by which time there were much greater public awareness, participation and realization of potential of the industrial area. The isolated case of acceptance of one bid which happened to be first time in the auctioning of the industrial plots, therefore, cannot be compared to the case of the petitioner.

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(8 of 8)

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[SAW-599/2021]

¶97

In the result, all these appeals are dismissed.

¶98

(SANDEEP MEHTA),J

¶99

(AKIL KURESHI),CJ

¶100

10to13,28to31,67S-jayesh/-

M/S K.B. Arts and Crafts v. the Rajasthan Industrial Development and Investment Corporation Ltd. (Riico)

Case brief

What is this about?

What did the court decide?

M/S K.B. Arts and Crafts v. the Rajasthan Industrial Development and Investment Corporation Ltd. (Riico)

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

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