Point of Law: Clause 11.8 mandates that upon being offered said coal, bidder cannot refuse on ground of non-suitability and/or sub-standard quality.

JUDGMENT :

1. The Petitioner in the instant writ petition is registered for participation in the auction for sale of coal by the North Eastern Coalfields Ltd. At this stage, it is relevant to take note of that the North Eastern Coalfields Ltd. has a Scheme for coal distribution through e-Auction. The said scheme is known as the e-Auction Scheme, 2007.

2. In the backdrop of the above, let this Court therefore take note of the facts involved in the instant writ petition. The Petitioner had in pursuance to a notified auction sale of coal vide the notice dated 16.01.2014 participated in the said e-Auction. It is the case of the Petitioner that the Petitioner deposited EMD of Rs.13,75,000/-for one rake of coal of the grade G1 ROM, exceeding 7500 K.Cal/Kg and not exceeding 7600 K.Cal/Kg. In the said e-Auction, the Petitioner was placed at Serial No.11 out of 12 successful bidders.

3. This Court at this stage finds it relevant to take note of Annexure-III which is the bid sheet issued on 16.01.2014. In the said bid sheet, the Petitioner’s name appeared at Serial No.11 and the Petitioner was allotted a quantity of 2750 MT at the price of Rs.6550/-per metric tonne and the total value of the allotment made in favour of the Petitioner was Rs.2,36,33,582.66p.

4. It further appears that in respect to another e-Auction, the Petitioner was also informed by a sale intimation letter that the Petitioner has been allotted 730 MT @ Rs.6100/- per MT and 770 MT @ Rs.6130/- per MT.

5. On the ground that the quality of the coal which was allotted to the Petitioner on the basis of the two e-Auctions were not of the requisite quality and marketable, the Petitioner refused to left the coal and consequently, the Respondent Company forfeited the EMD so submitted by the Petitioner. Being aggrieved, the Petitioner has approached this Court challenging the terms of the e-Auction Scheme, 2007 and more particularly to Clause 11.8.

6. Ms. B. Goyal, the learned counsel appearing on behalf of the Petitioner has submitted that Clause 11.8 of the terms and conditions of the spot e-Auction Scheme, 2007 is arbitrary and unreasonable inasmuch as the bidder on account of non-suitability and/or sub-standard quality for allotted quantity of coal cannot refuse to lift. The learned counsel for the Petitioner submitted that although Clause 4.2 of the Scheme of 2007 gives an option to the bidders to satisfy themselves with the quality of coal being offered from a source before participating in e-Auction but in effect no opportunities are given to the bidders after issuance of notice of e-Auction. The learned counsel submitted that as that opportunity was not granted in the regular course, the bidders like the Petitioner in view of the monopoly of the Respondent Company is compelled to participate without having the opportunity to satisfy the quality of coal being offered from a source. It is therefore the submission of Ms. B. Goyal, the learned counsel appearing on behalf of the Petitioner that when no opportunity is being granted to inspect the coal prior to participation in the e-Auction, Clause 11.8 of the Scheme of 2007 holding that the bidder cannot refuse on account of non-suitability and/or sub-standard quality for allotted quantity and if refused, the consequences of forfeiture of EMD on the basis of Clause 9 of the Scheme of 2007 is absolutely arbitrary, unreasonable and as well as irrational. The learned counsel therefore submitted that the Scheme of 2007 infringes the provisions of Article 14 of the Constitution.

7. On the other hand, Mr. M. Z. Ahmed, the learned Senior counsel appearing on behalf of the Respondents submitted that the Petitioner regularly participates in the auction process. The Petitioner knows very well about Clause 4.2 of the Scheme of 2007 and did not complain or ask the Respondent Authorities that the Petitioner wanted to inspect the coal prior to participating in the coal auction. The learned Senior counsel further submits that the Petitioner knowi