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High Court Of Calcutta
M. G. MUKHERJI, BASUDEVA PANIGRAHI
KALYANI SPINNING MILLS LTD. - Appellant
Versus
SUDHA SASHIKANT - Respondent
Appeal From Order 691 Of 1993
Decided On : 08/08/1994
Writ petitioner was declared the highest bidder in a tender issued by the appellant company for sale of obsolete textile machinery on "as is where is" basis. The appellant company invited fresh tenders in respect of some of the machinery for which the writ petitioner was the highest bidder. The writ petitioner filed a writ petition challenging the fresh tender notice and seeking a direction to the appellant company to deliver the machinery to her. The learned single Judge allowed the writ petition and directed the appellant company to deliver the goods or machinery in favour of the writ petitioner in terms of prayer (b) of the petition. The appellant company preferred an appeal against the said order. The issue before the Court was whether the learned single Judge was justified in directing the appellant company to deliver the goods to the writ petitioner.
Fact of the Case:
The writ petitioner was declared the highest bidder in a tender issued by the appellant company for sale of obsolete textile machinery on "as is where is" basis. The appellant company invited fresh tenders in respect of some of the machinery for which the writ petitioner was the highest bidder. The writ petitioner filed a writ petition challenging the fresh tender notice and seeking a direction to the appellant company to deliver the machinery to her. The learned single Judge allowed the writ petition and directed the appellant company to deliver the goods or machinery in favour of the writ petitioner in terms of prayer (b) of the petition. The appellant company preferred an appeal against the said order.
Finding of the Court:
The Court held that the learned single Judge was justified in directing the appellant company to deliver the goods to the writ petitioner. The Court found that there was a concluded contract between the parties for the sale of the machinery and that the appellant company had breached the contract by inviting fresh tenders. The Court also found that the writ petitioner was entitled to specific performance of the contract.
Issues: Whether the learned single Judge was justified in directing the appellant company to deliver the goods to the writ petitioner.
Ratio Decidendi: The Court held that the learned single Judge was justified in directing the appellant company to deliver the goods to the writ petitioner. The Court found that there was a concluded contract between the parties for the sale of the machinery and that the appellant company had breached the contract by inviting fresh tenders. The Court also found that the writ petitioner was entitled to specific performance of the contract.
Final Decision: The Court dismissed the appeal and upheld the order of the learned single Judge.
( 1 ) THIS appeal filed by Kalyani Spinning Mills Ltd. , is Managing Director and its Sales Officer impugns a judgment and order dated 6/08/1993 passed by P. K. Majumdar, J. in Matter No. 2922 of 1992.
( 2 ) THE learned single Judge by virtue of the said order directed Kalyani Spinning Mills Ltd. to rescind and not to give any effect to advertisements published in "the Statesman" dated 4th Sept. , 1992 in terms of prayer (a) of the petition and gave a further direction upon the said respondent, Kalyani Spinning Mills Ltd. forthwith to deliver the goods or machinery in favour of the writ petitioner (Respondent No. 1 in the present appeals ). Smt. Sudha Sashikant Shroff carrying on business under the name and style of Sudha Textile Traders in terms of prayer (b) of the writ application in respect of 64 items which were the subject matter of a contract in between the writ petitioner on the one hand and Kalyani Spinning Mills Ltd. on the other on payment of the entire balance price of the said machines, subject to adjustment of the deposit which was lying with Kalyani Spinning Mills Ltd. in the form of an earnest money advanced by the writ petitioner.
( 3 ) IT would be necessary for us to trace out the background of the entire case. On 22/05/1989 an advertisement was published in the Indian Express at the behest of Kalyani Spinning Mills Ltd. for sale of obsolete textile machineries on "as is where is basis" inviting tenders for the sixtyfour items of machinery. It was given out that machineries could be inspected at units at Kalyani Spinning Mills Ltd. at Kalyani and Ashoknagar during any working day. Earnest money at the rate of 5% of the quoted tender value must accompany the tender form by Account Payee / Demand Draft / Pay Order adjustable, refundable drawn in favour of the Kalyani Spinning Mills Ltd. payable at Calcutta. The last date of submission of tender was within one month of the publication of tender notice. The authority reserved the right to reject any or all tenders in part or full without assigning any reason thereof. About the terms and conditions for sale of obsolete textile machineries, it was given out that earnest money at the rate of 5% of quoted value will be accepted only in the form of Account Payee / Demand Draft or Pay Order on any Bank in Calcutta and drawn in favour of the Kalyani Spinning Mills Ltd. Payment of earnest money in cash will not be accepted. Tender papers without requisite earnest money will not be accepted. For the successful tenderers, the earnest money so deposited will be treated as security deposit bearing no interest and amount will be refunded or adjusted after the transaction has been completed successfully and satisfactorily. For unsuccessful tenderers, the earnest money will be refunded within a month after opening of the tender and will not bear any interest. Successful tenderers will be required to make full payments by Account Payee / Demand Draft or Bany Pay Order in favour of the company payable at Calcutta within 15 days from the date of acceptance of tender as per the proforma invoice issued by the company. If full payment along with taxes if any, applicable, is not received within the aforesaid 15 days, the earnest money will be forfeited.
( 4 ) BY way of general instructions it was given out in the terms and conditions of the tender that price should be quoted per machine/per site basis. Any complaint or dispute regarding quality and / or condition of the materials will not be entertained afterwards. The company reserved the right to cancel the tender partially or fully without assigning any reason whatsoever. It was the case of the petitioner that her tender on per machine per site basis was for a total sum of Rs. 36,97,960. 00 and she deposited Rupees 23,000/- towards earnest money. She was found to be the highest bidder but even the highest bid was found to be below the reserved price. Hence all the tenders were asked to participate in a
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