( 1 ) 1. The petitioner approached this Court through this writ petition seeking to declare the action of the respondent in confirming the tender No. M and S-39/vgg-SB/04 through the proceedings dated 6-5-2004 as arbitrary and illegal and to further declare that the contract is frustrated and to refund rs. 47,82,575/- with interest.

( 2 ) THE petitioner is a company carrying on business of quarrying and marketing granite in domestic and international market. The respondent is the A. P. Mineral development Corporation Limited, an instrumentality of the State. The averments made in the affidavit filed in support of the petition are briefly as follows:

( 3 ) THE respondent issued a tender notification on 15-4-2004 for sale of 147-675 cbm. of galaxy granite rocks from the quarry situated at R. L Puram Village, Chimakurthy mandal, Prakasam District. In pursuance of the tender notification the petitioner submitted its tender on 24-4-2004 by quoting the bid amount at Rs. 47,82,575/- @ $ Rs. 29,000/- per cubic metre. Along with the tender documents the petitioner deposited Rs. 7,00,000/- towards Earnest money Deposit (HMD ). The tenders were opened on 2/-4-2004 and the petitioner became the successful bidder. The respondent through the proceedings dated 6-5-2004 confirmed the bid and directed the petitioner to pay the bid amount. When the petitioner sought for extension of time for payment of the balance bid amount through the letters dated 19-5-2004 and 26-5-2004, the respondent granted extension of time for payment of the bid amount. Subsequently the petitioner came to know that a writ appeal covered by W. A. No. 621 of 2004 is pending in this High Court in respect of the quarry from which the granite blocks were agreed to be sold and a "status quo" order was passed by the Court on 23-4-2004. The petitioner therefore addressed a letter to the respondent on 19-6-2004 seeking clarification whether the respondent can accept the bid amount from the petitioner in view of the interim order of the High Court dated 23-4-2004. The respondent addressed a letter to the petitioner on 21-6-2004 informing that in the light of the information given by the Advocate General, the interim order of the High Court will not come in the way of dealing with the granite blocks and the petitioner can pay the bid amount and lift the blocks. Pursuant to the letter of the respondent the petitioner deposited the entire bid amount on 14-9-2004 and requested the respondent for transport permits to transport the granite blocks by informing that the sale agreement with the buyers of the petitioner is a time- bound supply agreement and the space in the ship was also kept ready to transport those blocks. Despite payment of the entire bid amount the respondent did not issue transport permits, therefore, the buyer of the petitioner cancelled the purchase order on 9-10-2004. Due to the inaction and failure of the respondent in issuing transport permits, the petitioner could not deal with the granite blocks and the tender became frustrated. The petitioner therefore addressed a letter to the respondent on 22-10-2004 and requested the respondent to refund the bid amount. No reply was sent by the respondent despite reminders. Ultimately, on 1-12-2004 the respondent informed the petitioner that they moved the High Court for modification of interim order of status quo dated 23-4-2004, that the matter was listed on 2-12-2004, therefore, they requested the petitioner to wait for some more time. The petitioner got issued a legal notice on 13-12-2004 seeking refund of the deposited bid amount as the entire process of opening the bid confirming the bid and receiving the balance amount itself is illegal and contrary to court orders. The respondent without informing the petitioner about the status quo order dated 23-4-2004 and without getting necessary clarification or modification of the interim order of the Court has confirmed the bid on 6-5-2004 and consequently t