Manorath Singh vs Ziladhikari and Another

Om Prakash, J.—The short question for consideration in this writ petition is whether lease deed dated 8th March, 1994, (Annexure ''8'' to the writ Petitioner for carrying on mining operation was legally executed upto 30th September, 1994.

The facts as briefly stated, are that an advertisement dated 7-8-1993, for holding auction notifying 10-9-1993 as date of auction for basing out several areas in district Bands for excavation of sand for the period, commencing from 1-10-1993 to 30-9-1994, was made in Nav Karam Yug a daily Hindi newspaper.

For some reasons, the auction could not be held on 10-9-1993 and the same was held on 18-9-1993. In the said auction, the Petitioner turned out to be the highest bidder in respect of Khand-7, His highest bid was provisionally accepted on 18-9-1993 itself and he made the requisite deposits on that day. Prior to 18-9-1993, a writ petition No. 30005 of 1993 was filed by one Subhash Chandra Dwivedi challenging validity of the auction notice dated 7-8-1993 and in the said petition, an interim order dated 17-9-1993 was granted mutating that the auction overeating may go on hut the bids would not be finalized till further orders The said writ petition be distressed on 14-2-1994 and then the interim order stood vacated. In view of the itching order dated 17-9-1993, auction dated 18-9-1993 was held subject to the condition that the bids would be finalized only after the said interim order wan modified or vacated by the this Court. The auction was made under Chapter IV of the U.P. Minor Minerals (Concession) Rules, 1963 of the Rules'' for short). All the tenderes/bidders participated in the auction dated 18-9-1993 subject to that condition immediately after the interim order stood vacated, the bids were finalized and the highest bid of the Petitioner wan accepted on 18-2-1994. The Petitioner was also asked in the letter of acceptance by the Collector Banda to take necessary step for getting the lease deed registered. The Petitioner purchased the requisite stamp papers and submitted the same to the Collector Banda seeking registration of the ease. The lease deed was then gestured clearly stipulating that the lease would expire on 30th September, 1994.

Having received a letter of acceptance dated 18-2-1994, the Petitioner filed a writ petition No. Nil of 1994, which was finally disposed of by the Court on the same day saying that the Petitioner may make a representation to the District Magistrate, Banda, and the same shall be decided within one month from the date of receipt of such representation by ''he said authority. After judgment dated 25-2-1994 (Annexure "7" to the writ petition), the Petitioner got the lease deed registered on 3-3-1994 and thereafter filed objections on 26-4-1994 annexing a body of the High Court judgment dated 25-2-94 before the District Magistrate, Bandi, which were rejected on 3-8-1994.

On these facts, the Petitioner seeks quashing of impugned order dated 3-8-1994 (Annexure "10" to tae writ petition) passed by he District Magistrate, Banda and of the condition made in the lease deed dated 8-3-94 (Annexure "8" to the writ petition) that the leas would be operative only upto 30-9-1994. Also the Petitioner seeks a writ of mandamus directing Respondent No. 1 to c impute one year period of lease from 18-2-1994, that is the date of acceptance and thereby modifying the lease deed that the same would be operative upto 17-2-1995 and directing Respondent No. 1 further act to interfere with the mining operation by the Petitioner upto 17-2-1995.

In the counter affidavit filed on behalf of the Respondents, it is averred though auction notice specified one year period of lease from 1-10-1993 to 30-9-1994, the auction was held on 18-9-1993 with a clear stipulation that the bids would be finalized only after interim order dated 17-9-1993 stood vacated and, therefore, tenderers/bidders knew vary well that mining operation would terminate on 30-9-1994 and the date of its commencement" was dependent upon the interim order dated 57-9-1993 being vacated, ft is. further, averred in the counter affidavit that the Petitioner participated in the auction with full knowledge that the tease might nor commence from the date, which was notified ii the auction notice and that the lease would commence only after the interim order dated 17-9-1993 was vacated by the Court, In short, the plea of the Respondents is that the Petitioner having participated In the auction on 18-9-1993 with full knowledge of the interim order and the letter of acceptance having been seat in conformity with the auction notice, which clearly stated that the lease would terminate on 30-9-1994, the contract as concluded between the parties, was upto 30-9-1994 and that the Petitioner having made no protest about the date of termination of lease before the letter of acceptance was received by him he cannot be permitted to raise an issue as to the period of lease.

Sri S.P. Gupta, learned Counsel for the Petitioner, relying on the proviso to Sub-rule (2) of Rule 13 falling in Chapter IV eatitled "Auction Lease" of the Rules, submits that the period of eases hi respect of river mineral deposit shall be one year and that being the statutory period cannot be curtailed by the Respondents. His submission is chat in auction notice, the Respondents already notified the period of one year from 1-10-1993 to 30-9-1994 and that the Petitioner participated in the auction on the understanding that the period of lease would be one year, though the dates as notified in the auction notice any vary. It is, further, urged by him that if on account of interim order, the impoundments were not able to adhere to the dates of the lease as notified in the auction notice, they were free to substitute the date of commencement and termination of lease, but they could not interfere with the lease period of one year, which was clearly stipulated in the auction notice. What he submits is if the date of commencement of the lease cannot be adhered to and if it becomes accessory to shift the same, then the date of termination of lease would correspondingly extend without affecting the lease period of one year. Sri Gupta further submits that Rule 29(2) mandates that the period of lease shall be calculated with effect from the date of receipt of the letter of acceptance of if bid or the tender by the bidder/tenderer. It is, therefore, urged by him that one year period of lease, which is a basic condition of the lease, should be calculated by the Respondents from 18-2-1994, that is, the date of acceptance in this case and to it is so done, then the date of termination would be 17-2-1995 and not 30-9-1994. The quintessence of the submission of Sri Gupta is that lease period of one year (sic) specified by the proviso to Sub-rule (2) of Rule 23 being statutory mandate cannot be curtailed by the Respondents in any case and what is open to the Respondents is only to vary the date of commencement and termination of lease.

The question for consideration is whether period of one year as specified in the proviso to Sub-rule (2) of Rule 23 is inflexible or invariable and whether that can be varied by agreement of the parties. This question is not res integral, in so far as this Court is concerned. It came up bafore this Court for consideration in Ram Naresh Pandey v. State of U.P. (1994) 1 UP CRCR 19, and then a Division Bench of this Court held that the proviso to Sub-rule (2) of Rule 23 only put an outer limit of five years and one year, as the case may be, but that "cannot be read as restricting the State Government in granting the permission for a period of less than as provided therein. Reading in this context the proviso, the period of.... for river bed mineral deposit cannot be more than one year at a time". The Court farther held:

The use of word "shall" in this proviso, in this context could not be lead as mandatory but is only directory. What is mandatory is to grant of lease bar to be not more than one year at a time.

We are in complete agreement with the view taken by this Court in Ram Naresb Facdey supra One year limit in respect of river bed mineral deposit as specified in the proviso to Sub-rule (1) of Rule 23 being the outer limit only, we art afraid that the contention of Sri Gupta that one year period is the basic feature of this type of lease and, therefore, cannot be cut short cannot be accepted.

Admittedly rights of the Petitioner arising flora lease are governed by law of contract. The question is what is the contract which has been concluded be which parties. Though it is pleaded in paragraph 10 of the writ petition (hut at the time of (sic) has not known no the Petitioner that the High Court passed any inferring order directing the Respondents not to finalize the bids until further orders and that none of the authorities conducting the auction informed the Petitioner of any such stay order, Sri Gupta proceeded before us on the fooling that the Petitioner was well aware of the interim order dated 17-9.1993 preventing the Respondents from finalizing the bids un*ii further orders of this Court. If the Petitioner was well aware of the interim order., then the question is what time limit was agreed Upon between the parties, In it not the case of the Petitioner that the Respondents agreed to extend the period of lease beyond 30th September, 1994 at the time of auction. In the auction notice, period of lease was declared from 1-101993 to 30-9-1994. There was no agreement between the parties that in the date of commencement was shifted, then the date of termination would also correspondingly shift to keep one year period of lease intact. The Petitioner accepted the counter offer of the Respondents that the bids would be finessed only after internal order dated 17-9-1993 was vacated or modified by the Court, The Petitioner, therefore, entered into contrast with open eyes that the date of commencement of the lease as notified in the auction notice, could not be adhered to as that was subject lo the caudation imposed by interim order by tie Court. The Petitioner is bound by the contract, concluded between him and the Respondents. It is note (SIC) that (SIC) protest was made by the Petitioner at the time of the auction with regret the date of trepanation of lease as notified in the auction notice. Tae auction was concluded subject to the condition that finalization of bids vas subject to the interim order. The auction having been concluded on 18-9-1993, the Petitioner filed writ petition on 25-2-1994 stating that the (SIC) should be for one year from the date of execution of the lease. The same was finally decided by the Court on 25-2-1994 with the observation that the Petitioner may make a representation before the District Magistrate, Baud. The Petitioner filed objection pursuant to the judgment dated 25-2-1994 only on 26-4-1994 and he let the lease deed registered on 8-3-1994. It realist that neither the Petitioner protested at the time of auction against curtailment of lease period, nor at the time of registration of lease dead On these facts, the Petitioner cannot be permitted to rake up the issue of the period of lease deed, as contract between the parties was concluded with a clear stipulation that the lease was to expire on 30-9-1994 and that the finalization of bids made at the time of auction was subject to the Court''s order. In the absence of any promise on the part of the Respondents, either at the time of auction or before the date of registration of the leave died that period of lane would be extended beyond 30th September, 1994, the Petitioner cannot successfully argue that the Respondents committed illegality in adhering to the date of termination of lease,

Sri Gupta relied on:

(1) Gandhi Grah Nirman Sahkari Samiti Ltd. ect. etc. Vs. State of Rajasthan and others, .

(2) Raj Kumar Dey and Others Vs. Tarapada Dey and Others, .

(3) Radhakrishna Agarwal and Others Vs. State of Bihar and Others, .

(4) Vinod Kumar Anand v. Dr. A.D. Sharma (1989) l. I U.P. LB EC 238;

(5) Mohammad Shamim Ansari v. State of U.P. (1989) l. I U.P. LB EC 269;

(6) Ram Pyare Chaudhary and Another Vs. State of Uttar Pradesh and Others, .

None of these authorities relate to contractual matters but they relate to the law relating to limitation laid down by various statutes or to the question as to when the term of an elected person will commence. For the reasons, there is no need for us to dilate upon these authorities. The case of the Petitioner will be governed only by law of contract and as already pointed out, a contract was concluded between the parties that the lease would come to an end on 30th September, 1994.

Such dispute is not uncommon so far as the mining leases are concerned. Endless litigation is going on particularly as to the period of lease. To obviate such litigations, the Respondents should act more carefully leaving no room for controversy and arguments, in so far as period of lease as concerned. If it is not possible for Respondents for unavoidable reasons to adhere to the time limit of one year, then the period of lease should be notified as precisely as possible so that prospecting tenderers/bidden may not have any confusion and nay not make any guess work M to the period of lease.

In paragraph 33 of the writ petition, it is pleaded that no liberty was given to the Petitioner to withdraw the tender before acceptance in view of unavoidable situation arising from interim order dated 17-9-1993. Law of contract is very clear that one can withdraw the tender before that was accepted, Nothing is pointed out to us as to what prevented the Petitioner from withdrawing his tender, if he thought that the finalization of bid being subject to Court''s order was detrimental to him. Rule 27-B Sub-rule (5) states that a tender once submitted shall not be withdrawn before expiration of 60 days or until any bid or tender in respect of the area or areas is accepted by the Officer authorised. It is implied in Sub-rule (5) that a tender may be withdrawn but not before the expiry of 60 days and that the tender may alio be withdrawn before it is accepted by the Officer authorised. This provision is consistent to the law of contract and, therefore, the Petitioner was free to withdraw his tender after the expiry of 60 days or before the same was accepted by the Officer authorised. The Petitioner having not withdrawn the tender and he having nude no protest against the date of termination of lease either before the auction or before the date of acceptance, it must be held that (he Petitioner is bound by the contract, concluded between the parties that the lease was only upto 30th September, 1994.

Lastly Sri Gupta argued that Sub-rule (2) of Rule 29 only gives the starting point of calculating the period of lease and does not specify the terminal point. He submits that under Sub-rule (2) of Rule 29 the period of lease shall be calculated with effect of from the date of receipt of the letter of acceptance of the bid or the tender. He reiterates that the time limit of lease being one year has to be calculated from the date of receipt of the letter of acceptance and if the is so done, the date of termination of the lease would be much beyond 30th September 1994 Such submission of Sri Gupta is based on the assumption that the period of lease is one year and that cannot be cut short in any circumstance. As we have already held that one year is only outer limit, this argument does not commend acceptance.

For the reasons, we do not see any illegality in the specification of period of lease.

The petition, therefore, fails and is dismissed.