Judgement

RAGHUBAR DAYAL, J.: This appeal on certificate granted by the Rajasthan High Court is against the dismissal of the appellant s writ petition under Art. 226 of the Constitution praying for the issue e of a writ of certiorari to the State of Rajasthan, respondent No. 1, for the cancelling and setting aside of its order dated April 1, 1964 granting the contract for collecting royalty on building stones excavated from certain area to respondent. No. 2, Dharti Dan Shramik Theka Sahkari Samiti Ltd., a co-operative society. The appeal arises in these circumstances.

2. The appellant offered the highest bid at the auction for the grant of royalty collection contract on 21-1-1964. Respondent No. 2 was also one of the bidders, but stopped after offering abid of Rs. 33,000. The final bid of the appellant was for Rs. 42,200. The State Government made the order in favour of respondent No. 2 on an application made by it on March 5, 1964, stating therein that the appellant had not deposited 25 per cent. of the bid amount as security immediately after the completion of the auction in accordance with R. 36 (7) of the Rajasthan Minor Mineral Concession Rules, 1959, hereinafter called the rules, and as per the terms and conditions of the Auction Notification and that it was prepared to take the royalty collection contract on the highest bid of Rs. 42,200. It was further stated in the application that respondent No. 2 was a co-operative society of the labourers who themselves worked on the mines of the area and therefore in view of Government s policy it should receive preference to an individual bidder. It was further stated that the benefit accruing out of the contract of royalty collection would be shared by the labourers and workers themselves which would go a long way to improve their socioeconomic conditions and thus ultimately would ameliorate the conditions of the workers who were working hard in quarries since long.

3. The contention for the appellant is that the Government had merely to confirm the highest bid at the auction by way of formality and was not competent to sanction the contract in favour of someone who had not offered the highest bid at the auction.

4. Rule 34 of the rules provides that royalty collection contracts may be granted by the Government by auction or tender for a maximum period of two years after which no extension was to be granted. The procedure for auction is provided by R. 36. Sub-rule 5. there of provides that no bids shall be regarded as accepted unless confirmed by Government or the competent authority and sub-rule (7) provides that on completion of the auction the result will be announced and the provisionally selected bidder shall immediately deposit 25 per cent. of the amount of bid for one year and another 25 per cent. as security for due observance of the terms and conditions of the lease or contract. It is admitted for the appellant that on completion of the auction he did not deposit 25 per cent. of the bid as security in compliance with the provisions of sub-rule (7). He therefore lost whatever claim he could have had for the final acceptance of his bid by Government and therefore cannot question the grant of the contract to any other person by the Government.

5. The appellant urges that he held such royalty collection contract for the year 1963-64 and had deposited Rs. 9,250 as security for the due performance of that contract. On February 12, 1964, over three weeks after the auction, he submitted an application to the Mining Engineer, Jaipur, stating that he had been continuously taking contract for the last three years and that he was depositing Rs. 1,300 and that the balance of the security amount required, i.e., Rs. 9,250 be adjusted against Rs. 9,250 with the Government in connection with the earlier contract. This letter was not replied to. The request made in this letter could not possibly be accepted. The earlier contract was to continue up to March 31, and the security money had to r