Dismissed

Rasool Khan v. State and Ors.

Rajasthan HC17 May 2023CW/2511/2005

Case brief

AI extract

What is this about?

The Court dismissed a writ petition challenging the State's decision to re-auction a demolition contract. It held that the petitioner's father was the highest bidder but never received a formal work order, making the contract non-existent vis-a-vis the current petitioners. After a twenty-year lapse and significant material cost increases, the State was not bound to proceed with the contract.

What did the court decide?

The writ petition and stay application were dismissed as devoid of merit; pending applications were disposed of accordingly.

Rasool Khan Vs State and Ors. — Contract and Commercial Disputes | Rajasthan HC (2023)

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[2023/RJJD/014892]

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HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR

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S.B. Civil Writ Petition No. 2511/2005

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Rasool Khan S/o Shri Jeetu Khan since deceased through his LRs:-

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Smt. Haseena Bano widow of late Rasool Khan, aged 68 years.

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Ayub Khan s/o late Rasool Khan, aged 55 years,

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Usman Khan S/o late Rasool Khan, aged 48 years,

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Idrish Khan S/o late Rasool Khan, aged 25 years, All above 1 to 4, by caste Kayamkhani, residents of Holidhora, Ward No.40, Sujangarh, District Churu (Raj.).

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Smt. Meraj daughter of late Rasool Khan, wife of Riaz Khan, aged 30 years.

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Smt. Raju daughter of late Rasool Khan, wife of Riaz Khan, aged 30 years.

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Both above 5 and 6, by caste Muslim, residents of Village Dausar, Tehsil Deedwana, District Nagaur (Raj.).

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----Petitioners

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Versus

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The State of Rajasthan through the Secretary to the Government, General Administration (Estate) Department, Secretariat, Rajasthan, Jaipur.

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District Collector, Churu.

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Sub Divisional Officer, Sujangarh, District Churu.

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Tehsildar, Sujangarh, District Churu.

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----Respondent

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For Petitioner(s)	: Mr.	A.K.	Khatri
For Respondent(s)	: Mr.	R.D.	Bhadu,GC

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HON'BLE DR. JUSTICE NUPUR BHATI

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Order

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Reserved on : 09/05/2023 Pronounced on : 17/05/2023

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(1) The present writ petition has been filed under Article 226 of the Constitution of India with the following prayers:-

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“(i) by an appropriate writ, order or direction the respondents may be restrained from conducting the proceedings for re-auctioning the demolition of Rajaji Ki Kothi situated in Sujangarh, District Churu and

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(ii) by an appropriate writ, order or direction the petitioner be allowed to start work of demolishing Rajaji Ki Kothi and collecting ruins thereof in continuation of auction proceedings dated 11.05.2023 and approval of bid dated 19.05.2023.

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(iii) In the alternative, without prejudice to the above, the respondents be directed to re-pay Rs.56500/- with Rs.35000/- incurred by the petitioner in engaging labourers etc. along with interest @ 24% per annum to the petitioner. He may also be awarded compensation to the tune of Rs.100000/-.

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(iv) Costs be awarded to the petitioner.”

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(2) The facts in brief are that in Sujangarh, there was an old building, namely, Rajaji Ki Kothi in a very bad condition, therefore, the Stae Government, vide its letter dated 16.12.2002, accorded sanction to demolish the same by putting it in open auction. Pursuant to the sanction aforesaid, an auction committee was constituted and the date for auction for demolition of old building and collecting ruins thereof was fixed as 11.05.2003. Shri Rsool Khan (original petitioner), being aspirant, participated in the open auction and deposited Rs.25,000/- as earnest money with the respondent No.4. The father of the petitioners tendered the highest bid in the said auction amounting to Rs.1,26,000/- and deposited 25% of the bid amount, i.e. Rs.31,500/- with the respondent No.4. Thereafter, the bid of the father of the

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petitioners was approved by the respondent No.2 vide letter dated 19.05.2003 (Annex.3).

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(3) Shri Rasool Khan, father of the petitioners, thereafter started demolishing the old building by engaging labourers but, however, he had to stop the work as there was a stay granted by the Additional Civil Judge (JD), Sujangarh (Churu) on 13.05.2003 in Civil Suit No.16/2003 on an application for temporary injunction filed along with civil suit filed by one Shri Ram Singh for permanent injunction against the State for restraining the respondent State for demolishing old historical building situated in Sujangarh. However, the said suit was dismissed vide order dated 29.05.2004 (Annex.4) as not pressed. The respondent No.3 informed about the dismissal of the said suit to the respondent No.2 and stated that since the matter of demolishing the said building remained postponed due to the stay order granted by the civil court and since now the suit has been dismissed, therefore, requested the respondent No.2 to issue appropriate orders in this regard.

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(4) Shri Rasool Khan also made a representation dated 14.06.2004 (Annex.6) before the respondent No.2 to issue appropriate order for demolishing the building in continuation of auction proceedings taken up on 11.05.2003. Vide another representation dated 18.06.2004 (Annex.7), Shri Rasool Khan further sought appropriate order in the matter and also sought permission to deposit remaining amount. Since nothing was done by the respondent No.2, Shri Rasool Khan moved a representation

(4 of 11)

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before the respondent No.1 on 14.03.2005 (Annex.8). The Deputy Secretary to the Government, General Administration (Estate) Department, Jaipur, vide its letter dated 20.12.2004 (Annex.9) sought information that as to whether Rs.56,000/-, deposited by the final bidder has been repaid or lying with the State Government and further sought information that is there any possibility of getting increased estimated amount by putting the building on re-auction. Thereafter, the petitioner again made a representation to the respondent No.1 on 30.03.2005, requesting it to issue sanction again for demolition of building.

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(5) Pursuant to the letter dated 20.12.2004 (Annex.9), a committee was constituted to consider the matter regarding demolition of Rajaji Ki Kothi, Sujangarh under the Chairmanship of the Additional District Collector (Admn.), Churu and the committee took a decision that since the bid of Rs.1,26,000/- was finalized on 11.05.2003 and a period of two years has already elapsed due to stay order granted by the Civil court and since there is a huge rise in the rate of building material, iron and ruins of the building, therefore, there is full possibility of getting an increase in the estimated amount upon re-auction. The respondent No.2 thereafter wrote a DO letter dated 08.04.2005 to the respondent No.1 (Annex.11) seeking sanction to re-auction the builiding for demolition and collecting ruins of Rajaji Ki Kothi.

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(6) As and when Shri Rasool Khan came to know about the fact aforesaid, he submitted a notice dated 12.04.2005 (Annex.12) to the respondent No.1 that in case demolition of building is re-

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auctioned, the same will cause injustice to him and since he has already incurred Rs.35,000/- besides Rs.56,000/- deposited with the State Government, any decision in regard to re-auction be taken keeping in account his interest.

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(7) Thereafter, since nothing happened in the matter, Shri Rasool Khan, preferred the present writ petition under the apprehension of issuance of sanction for re-auction.

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(8) During the pendency of the writ petition, Shri Rasool Khan expired on 16.01.2021, therefore, his legal representatives were brought on record vide order dated 27.04.2022.

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(9) Learned counsel for the petitioners submitted that after getting the bid, the father of the petitioners started the work, engaged the labourers and incurred expenditure of about Rs.35,000/- but due to stay order granted by the Civil court, the work was stopped for two years. Thereafter, the father of the petitioners moved several representations before the respondent No.1 and 2. However, the Committee constituted in this regard, has taken a decision of re-auction. He submitted that once the bid amount is finalized and approved by the cmopetent authority, the respondent State cannot accord sanction for re-auction on the ground that there is possibility to get increased estimated amount. (10) Learned counsel for the petitioners submitted that the work was stopped for no fault of the father of the petitioners which is crystal clear and also not disputed by the respondents. It is also submitted by him that the father of the petitioners was ready and

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willing to complete the work and he also sought permission to deposit the remaining amount of Rs.69,500/-.

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(11) Learned counsel for the petitioners submitted that the approval of the bid dated 19.05.2003 was never cancelled by the concerned authority and till date the bid dated 19.05.2003 is not cancelled and the proceedings for re-auction has been started without giving any opportunity of hearing to the petitioner in an arbitrary manner.

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(12) Learned counsel for the petitioner placed reliance upon the judgment dated 16.05.2019 of this Court in the case of Pushkar Lal Jain & Ors. Vs. UIT & Ors. (S.B. Civil Writ Petition No.12976/2015) wherein this Court observed that any bid in auction can be cancelled, if it is not approved by the competent authority without assigning any reason by the Government.

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In the present case, the bid was finalized in favour of the father of the petitioners and the same was approved by the Collector. Therefore, neither it was cancelled nor can it be cancelled now after 20 years since the petitioners have been trying for 18 years to get the contract implemented.

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It is also submitted that on account of death of father of the petitioners, the petitioners have stepped into his shoes and in the I.A. No.1/2021 for bringing on record the legal representatives of Shri Rasool Khan, it was specifically mentioned that the applicant No.3, namely, Shri Usman Khan was a Contractor and engaged in such activities, thus, he was a necessary party along with other

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(7 of 11) [CW-2511/2005]

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legal representatives required to be taken on record and the Hon’ble Court had allowed the application.

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The judgment upon which the petitioner’s counsel has placed reliance upon, is not applicable in the instant case, as a Coordinate Bench of this Court in its judgment dated 16.05.2019 ( Pushkarlal Jain & Ors. Vs. Urban Improvement Trust, Udaipur , with other connected matters ), held that:-

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“37. As regards the submission made regarding reason not being assigned by the competent authority while taking the decision impugned, in the considered view of this Court also, there was no requirement under the law to indicate reasons by the competent authority for acceptance or rejection of the bid offered by the highest bidder and this being the executive function of the competent authority, no reason is supposed to be assigned while taking impugned decision and the correctness of its conclusion is ordinarily not open to judicial review, unless the right conferred being infringed by action of the authority, which is not the case of the petitioners herein.

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38. Thus, this Court finds that the authority was not bound to accept the highest tender/offer or bid and could validly retain its power to accept or reject the highest bid obviously in the interest of public revenue, and the order-sheet furnished records. the reason that better revenue could have been derived out of the auction in question.

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39. Thus, this Court concludes that the judgments cited by learned counsel for the petitioners are not applicable in the present case, whereas the judgments cited by learned counsel for the respondents hold the field.

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39. In light of the aforesaid observations and the aforequoted precedent laws laid down by the Hon'ble Supreme Court as well as Division Bench of this Hon'ble Court, no interference is called for in these writ petitions.

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40. Consequently, the present writ petitions are dismissed. The stay applications also stand dismissed accordingly.”

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(13) Per contra, learned Government counsel appearing for the respondents submitted that though the petitioners’ father was awarded the contract for demolition for building but no work order was issued and since long time has elapsed, the State Government has sought to issue fresh tender and under the said apprehension, the petitioners’ father had filed the present writ petition.

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(14) Learned Government counsel for the respondents further submitted that in contractual matters, this Court should not grant indulgence and interfere when writ jurisdiction under Article 226 of the Constitution of India is invoked. It is also submitted that the petitioner never applied for refund of earnest money and the money deposited pursuant to grant of tender. It is submitted that as of today, there is a huge increase in the price of building material, iron rods etc. than the price at the time when the tender was given to the petitioner and, therefore, fresh tender is required to be issued.

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(15) Heard learned counsel for the parties and perused the material available on record.

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(16) This is an admitted position that the petitioner was the highest bidder in the auction proceedings conducted by the respondents for demolition of old building and collecting debris thereof for which, the respondents made communication dated 19.05.2003 while mentioning in it that the committee constituted

(9 of 11)

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had sanctioned the name of the petitioner being the highest bidder for the purpose of demolition of “Rajaji Ki Kothi, Sujangarh, District Churu” and for collection of debris.

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(17) That on account of the interim order granted by the learned court below dated 13.05.2003 on an application for temporary injunction filed by one Shri Ram Singh along with the Civil Suit No.16/2003 for restraining the respondent State for demolition of the said building, the work was stopped. However, the application for temporary injunction and the Civil Suit No.16/2003 were dismissed as not pressed vide order dated 29.05.2004. After the name of petitioners’ father was sanctioned in the communication dated 19.05.2003 respondents did not issue the work order in favour of the father of the petitioners as no document whatsoever has been placed by the petitioner on record in order to show that the work order had been issued in his favour and he in pursuance of the same, had started the work accordingly.

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(18) This is also an admitted position that during such long period, the petitioners have never applied for refund of the earnest money as well as the money deposited for grant of tender in favour of the respondents in pursuance of the sanction order dated 19.05.2003.

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(19) That on account of elapse of about twenty years, the market value of the building material, iron rods etc. had increased drastically and when the building would be demolished, the rates would be exponentially higher than the rate on which, the

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petitioners’ father was issued the contract in the year 2003 and thus, the State would suffer huge revenue loss.

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(20) That had the petitioner been allotted the work order and the period of twenty years would not have elapsed, then, certainly, the petitioner had a right to continue with the contract entered into between the parties but however, in absence of any work order in his favour and particularly when a period of twenty years has elapsed, the respondents cannot be compelled to permit the petitioners to start the demolition of the building and collection of debris.

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(21) It is also important to note that the petitioner namely Rasool Khan (since deceased), in whose favour the sanction order had been given, had expired on 16.01.2021 and thus, in the given circumstances, the legal representatives of the petitioner cannot step into the shoes of their father because the sanction order dated 19.05.2003 had not been issued in favour of the legal representatives of Shri Rasool Khan, i.e. the current petitioners.

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(22) The law of contracts does not provide for any kind of succession rights for the purpose of performance of contract unless there is some specific stipulation regarding the same. Admittedly, in this case, there is no such stipulation and the performance of contract does not have any privity between the petitioner and the respondents.

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(22) In view of the discussion made hereinabove, the instant writ petition as well as the stay application, is dismissed as being devoid of merit.

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(23) All pending applications, if any, also stand disposed of

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accordingly.

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(DR. NUPUR BHATI),J

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/skm/-

Rasool Khan v. State and Ors.

Case brief

What is this about?

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Rasool Khan v. State and Ors.

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