When highest bidder did not come forward, second action held without considering other bidders.

S. Palanivelu, J.

These appeals are filed against the common order, dated 30.08.2007, made in W.P.(MD) Nos.6736 and 3562 of 2007, whereby the contract of lease of fishery rights awarded to the appellant by the second respondent was set aside by a learned single Judge.

2. In Bodi-Ammapatti Village of Bodinayakkanur Taluk of Theni District, a tank, known as Meenakshi Amman Periyakanmoi is situated, sprawling to an extent of 86.12 Hectares in Survey No.220. It is learnt, that throughout the year, water would be available in the said tank. It comes under the direct control of the Assistant Director of Inland Fisheries, Vaigai Dam, in Theni District, the superior authority being the Director of Fisheries in Chennai. Fishery rights were used to be leased out periodically as per G.O.Ms.No.33, Animal Husbandry and Fisheries, dated 27.02.1995.

3. By virtue of the powers conferred, the Assistant Director of Fisheries, in short, the Assistant Director, invited sealed tenders through a notification, dated 14.03.2007, fixing the upset price at Rs.2,34,000/-. As per the said notification, it was proposed to lease out the right to catch fishes in the tank for the period from April,2007 to June,2010.

4. In order to unearth the truth, this Court directed the learned Special Government Pleader to produce the relevant files before this Court and, accordingly, they are produced. A perusal of the said files reveals some important points to be considered in these appeals.

5. It is significant to note the viability and capacity of the tank. It is necessary to bear those particulars in mind, to reach an appropriate conclusion. The particulars for fixing the upset price at Rs.2,34,000/- are available in a note prepared by the Assistant Director, in which it is mentioned that considering 40 percentage of the surviving fishes after culture and fixing the average weight of a fish at 900 grams and also calculating the value of fish at Rs.30/-per k.g., the proposed total income on sale of fishes would be Rs.11,70,450/-, if 39,015 kgs. of fishes were developed. The upset price for auction was 20% of the gross value of the fishes, which would come to Rs.2,34,000/-. On 08.02.2007, the Assistant Director ascertained the said value. Sealed tenders were called for, which were to be opened on 30.03.2007 and, accordingly, on 30.03.2007, in the meeting hall of the Collectors Office at Theni, the auction was held at 03.30.p.m.

6. It was the version of the Assistant Director in his counter affidavit, that out of 41 tenderers, the highest bidder Tamilarasan offered Rs.19,02,518/-and the second highest bidder Sekar quoted Rs.15,06,700/-. Since both of them expressed their inability to pay the quoted bid amount, their Earnest Money Deposit of Rs.5,000/- each was confiscated to the State and nobody else among the remaining 39 tenderers came forward to bid the auction and, hence, the auction was cancelled on that date.

7. But, the writ petitioners would contend that though other participants came forward to bid the auction, the Assistant Director closed the auction and cancelled it arbitrarily.

8. In this connection, it is to be noted that the Assistant Director is competent to cancel the auction, however, the discretion must be exercised judiciously.

9. A careful scrutiny of the relevant register, captioned as "Tender Opening Register", would show that there were as many as 41 persons, who submitted their tenders and the tender amounts were ranging from Rs.2,34,050/- to Rs.19,02,518/-. It is seen that most of the tenderers had offered attractive amounts. At the end of the list, the Assistant Director has written that the auction was knocked down in favour of Tamilarasan, who offered highest bid of Rs.19,02,518/- and, afterwards, he has also written that the auction was cancelled on the same day, i.e., 30.03.2007.

10. Also, the file submitted by the learned Special Government Pleader contains two letters written by the Assistant Director, one addressed to