PRADEEP TIMBER CO Vs. H P STATE FOREST CORPN LTD

JUDGEMENT

(1.) This case illustrates how public authorities entrusted with discretion in wide terms sometimes act in the exercise of their powers and how such actions give rise to avoidable litigation.

(2.) On Jan. 19, 1984, an auction notice, Annexure PA, was issued by and on behalf of the respondent-Corporation for an open auction of the specified quantity of fire wood, pulp-wood and charcoal in eight different lots and it was notified that the auction will be held on Feb. 19, 1984. By a subsequent notice issued on March 3, 1984, Annexure-PB, it was notified that the said auction would be held on March 19, 1984 instead of Feb. 19, 1984.

(3.) The conditions of the auction-sale (Annexure-PC), were duly notified. Amongst the conditions so notified four are material for the present purposes and they might be adverted to. First, the highest bid was liable to be rejected without assigning any reason by the auctioning/sanctioning authority; secondly, the highest bidder(s) would be required to execute an agreement within a period of 7 days from the date of sanction; thirdly, on communication of the acceptance of the bid, the successful bidder(s) would be liable to pay the price of the auctioned quantity of the material in two equal instalments; and fourthly, the bid shall remain open for a period of 20 days to enable the competent authority to accord sanction. All these conditions read together would indicate that : (1) the contract for sale was not to be taken to have concluded at the fall of the hammer; (2) the bid would remain open for a specified period to enable the competent authority to accord sanction; (3) even the highest bid could be rejected without assigning any reason, and (4) the highest bidder(s) would be required to execute an agreement and pay the price in instalments within the specified period from the date of sanction.