Revision of contract price by a governmental entity under mutual terms is permissible and does not violate constitutional rights if conducted fairly and within the agreed terms.

ORDER :

1. Learned counsel for the petitioner, at the outset, requested the Court to hear the matter at this stage itself despite the fact that no reply has been filed by the respondents’ counsel, however, the respondents’ counsel agreed to the said request of the petitioner and therefore, the instant matter is heard and decided today itself.

2. The instant writ petition has been filed under article 226 of the constitution praying following reliefs :-

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A. That Impugned Office Order dated 17.10.2025 (Annex.26) issued and passed by Respondent No. 2 on behalf of Respondent no. 1 may kindly be quashed and set aside and it be declared as violative of Article 14 and 19 (1) (g) of the Constitution of India;

B. That Respondents may kindly be directed to continue the dispatch of Lignite at Kasnau mines on the earlier sale consideration i.e. earlier basic selling price at Rs. 2100 PMT as agreed between the parties immediately.

C. That Respondents may be directed to not to forfeit the Earnest Money Deposit (EMD)/Security Deposit, as available with them, deposited by Petitioner with the respondents, after the expiry of validity of extension period i.e. 30.10.2025.

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3. Brief facts of the case are that the petitioner is a company incorporated under the provisions of the Companies Act and is engaged in the business of mining and trading of lignite. Respondent No. 1 – Rajasthan State Mines & Minerals Limited (RSMML) – is a Government of Rajasthan enterprise engaged in mining and marketing of industrial minerals in the State. Respondent No. 1 invited bids through an e-auction dated 24.10.2024 (Annnex.2) for the sale of Run-of-Mine (ROM) Lignite from Kasnau Mines, Nagaur, under specified terms and conditions. The petitioner participated in the said e-auction, was declared a successful bidder, and was allotted 16,600 metric tonne (MT) of lignite at a basic price of ₹2,100 per metric tonne, the contract was valid upto 31^st March 2025. A sale intimation letter and purchase order were thereafter issued by the respondents confirming the allotment. It is the case of the petitioner that subsequent to the allotment, the respondents failed to commence timely production of lignite from the said mines, resulting in delays, irregular dispatches, inadequate stock availability, and supply of lignite of inferior quality having excessive moisture content. The petitioner made several representations and sent multiple emails seeking redressal of these issues; however, no effective action was taken by the respondents. Owing to these operational difficulties, the respondents themselves extended the validity period of the e-auction contract on several occasions, and the validity was ultimately extended up to 30.10.2025(Annex.22). During this extended period, the petitioner continued to lift lignite as per the availability at the mines and deposited the requisite instalments from time to time. Out of the total allotted quantity of 16,600 MT, the petitioner could lift only 9,906.37 MT, leaving a balance of 6,639.63 MT un-lifted on account of the respondents’ failure to ensure regular and adequate supply. On 17.10.2025 (Annex.26), the respondents issued an Office Order revising the basic sale price of lignite from Rs. 2,100 per metric tonne to ₹3,030 per metric tonne with immediate effect, in purported exercise of powers under Clause 13.5 of the e-auction terms, and called upon the petitioner to convey its consent to the revised price within three days in order to continue further dispatches. The petitioner objected to the said revision, contending that the unilateral enhancement of the price during the subsistence of the contract was arbitrary and without justification, particularly when it had already entered into commitments with its customers at the earlier rate. The petitioner submitted that such a sudden and unilateral increase in price would cause severe financial hardship and disrupt its ongoing contractual obligations. It is the grievance of the peti