Vineet Saran, J. - (1.) -The moot question in this writ petition is whether it is the sanctity of the auction proceeding which is to be preserved or the Revenue of the State which is to be of prime consideration.
(2.) IN an auction held on 19.2.2003 for the grant of mining rights of minor minerals of Tehsil Sarila, district Hamirpur, the respondent No. 4, M/s. Chaudhary Associates Co. was the highest bidder. Their bid of Rs. 1.51 crores was forwarded by the District Magistrate to the State Government for its approval. After the State Government accorded its approval, the lease deed for the said area was executed in their favour on 15.3.2003. By means of this writ petition the petitioner M/s. Harihar Contractors have challenged the grant of the lease in favour of respondent No. 4 and have also prayed that the offer of the petitioner of 2% above the reserved price (fixed by the State at Rs. 2,21,19,485) be accepted, and the lease for a period of three years for excavation of minerals from the area in question be executed in their favour. The facts, in brief relevant for the adjudication of this petition are that on 7.2.2003 a notice was issued by the respondent No. 2, District Magistrate, Hamirpur fixing 19.2.2003 as the date for auction for grant of mining rights for 3 years of certain areas, including the area in question, i.e., Tehsil Sarila, district Hamirpur. The auction was to be conducted and lease granted in accordance with Rule 27 of the U. P. Minor Mineral (Concession) Rules, 1963 (hereinafter referred to as the Rules). It was also specified in the notice that in case if the auction for the entire area was not completed on the said date, then the remaining areas would be auctioned on 27.2.2003. The reserve price for the area in question was fixed at Rs. 2.21 crores and odd. At the auction held on 19.2.2003, the respondent No. 4 was the highest bidder. Their bid of Rs. 1.51 crores, though about Rs. 70 lacs below the reserve price, was provisionally accepted by the respondent No. 2. As per Rule 27 of the Rules read with the Government Order dated 2.11.2002, the papers were sent to the State Government for its approval/acceptance. The State Government accepted the said bid on 7.3.2003 and thereafter the lease deed for a period of three years was executed in favour of respondent No. 4 on 15.3.2003. The main grounds of challenge of the said auction are that the bid of respondent No. 4 could not have been accepted as it was much below the reserve price ; that the auction was not conducted in a free and fair manner ; and that the offer of the petitioner of 2% above the reserve price ought to have been accepted which would be in the interest of the State Revenue as well. Mala fides on the part of the respondents were also alleged by the petitioner.
(3.) AT the time of filing of the writ petition, the petitioner had made an offer of 2% above the reserve price. which comes to about Rs. 2.25 crores. In order to prove their bona fide, this Court vide order dated 27.3.2003 directed the petitioner to deposit a sum of Rs. 1.12 crores with the District Magistrate, Hamirpur. The said amount has admittedly been deposited on 31.3.2003 and an affidavit to this effect has also been filed by the petitioner. We have heard Sri Yogeshwar Prasad, learned senior counsel assisted by Sri Madhur Prasad on behalf of the petitioner ; as well as Sri C. S. Singh, learned Standing Counsel for respondent Nos. 1, 2 and 3 and Sri Rajiv Dhawan learned senior counsel assisted by Sri Prashant Kumar and Akhilesh Kalra for respondent No. 4.;