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Judgment
N.K. Parekh, J.—The facts that give rise to this petition are that the Director of Health Services issued a notice dated 21st July, 1983 inviting tenders in respect of used X-ray plates and "wasteful hypo solution" to be sold to Small Scale Units (these being items from which silver is extracted). Six parties submitted tenders in respect thereof. However, the Government thereafter passed a Resolution dated 3rd August, 1984 purporting to distribute these two items amongst three parties, namely, the petitioners (herein) and respondents Nos. 3 and 4 and also indicating the areas in which each of these parties would operate. The said resolution also stipulated that the used X-ray films would be sold at Rs. 40.50 per kilogram whilst "wasteful hypo solution" would be sold at Rs. 11.00 per liter. Being aggrieved by the said Resolution, the petitioners have filed this petition for quashing the said resolution and consequential relief''s. The petitioners have contended : (a) that the tenders have not been rejected and/or have otherwise not been dealt with and the Government could not purport to pass the resolution (now impugned) distributing the items in the manner they have done, (b) that looking to the tenders filed by the petitioners and respondents Nos. 3 and 4, the rates quoted by the petitioners in respect of both the items were the highest, and the petitioners'' tender ought to have been accepted and the items ought to have been given to the petitioners exclusively, and (c) that there was no methodology by which the Government allotted these items in the proportions specified in the said resolution, or allocated the areas specified in the said resolution, or as to how the respondents No. 3 and 4 who had quoted a lesser price, were allotted a part of the said items, and as to how they were called upon to pay the price at which the petitioners had offered to buy the items.
The petition is of course resisted by respondents Nos. 1 and 2 who have contended that these items were to be sold to small-scale industries with a view to help such industries. That it is in the light of this policy that the items were allotted amongst the petitioners and respondents Nos. 3 and 4. That although the price quoted by respondents Nos. 3 and 4 in their tenders were lower than the price quoted by the petitioners, nonetheless respondents Nos. 1 and 2 had demanded the same price from respondents Nos. 3 and 4 as quoted by the petitioners and hence there was no loss to the Government. That in the circumstances the question of quashing the said resolution did not arise. Respondent No. 3 has contended that although under the impugned Government resolution respondent No. 3 was allotted a quota less than what they would be entitled to, the question of quashing the said resolution did not arise. Respondent No. 4 has contended that the High Court Bench sitting at Nagpur has no jurisdiction to receive, try and hear this petition. On merits, respondent No. 4 has contended that since the intention of the Government in selling these items was to assist small-scale industries, the Government resolution (now impugned) fulfils the very purpose, and the petitioners would be entitled to no relief.
Now as regards the question whether this Court has jurisdiction to receive, try and hear this petition is concerned, it has been submitted by counsel for respondent No. 4 that admittedly the tender notice was issued in Bombay and the resolution (now impugned) was also passed at Bombay. That the whole cause of action had arisen in Bombay. That it was the cause of action that attracted jurisdiction, and this being so, the High Court Bench at Nagpur had no jurisdiction to receive, try and hear this petition. In support of this contention, counsel for respondent No. 4 placed reliance on the decision in the case of M/s. Siku Industries & Others v. Smt. CD. Souza, Inspector, Office of the Regional Provident Fund Commissioner, State of Maharashtra, Bombay and another (1971 MhLJ 172). Counsel for respondent No. 4 further contended that section 41 of the Bombay Reorganisation Act, 1960 (Act No. 11 of 1960) reads as follows :
Without prejudice to the provisions of section 51 of the States Reorganisation Act, 1956, such Judges of the High Court at Bombay, being not less than three in number as the Chief Justice may, from time to time nominate, shall sit at Nagpur in order to exercise the jurisdiction and power for the time being vested in that High Court in respect of cases arising in the districts of Buldana, Akola, Amravati, Yeotmal, Wardha. Nagpur, Bhandara, Chanda and Rajura :
Provided that the Chief Justice may, in his discretion, order that any case arising in any such district shall be heard at Bombay.
That Chapter XXXI of the Bombay High Court Appellate Side Rules. 1960, inter alia. reads as follows :
All appeals, applications, references and petitions including petitions for exercise of powers under Articles 226 and 227 of the Constitution arising in the Judicial Districts of Akola. Amaravati, Bhandara,'' Buldana. Chandrapur. Nagpur, Wardha. Yavatmal and Gadchiroli which lie to the High Court of Bombay shall be presented to the Additional Registrar of that High Court at Nagpur and shall be disposed of by the Judges sitting at Nagpur :
Provided that the Chief Justice may, in his discretion, order that any case arising in any such district shall be heard at Bombay.
That the reading of these two provisions must further demonstrate that it is the place where the cause of action arose that will attract jurisdiction and in the present case the cause of action having arisen in Bombay, the petition if at all ought to be presented before the High Court Bench in Bombay but the High Court Bench at Nagpur would be precluded from entertaining the writ petition. In other words, this "Court" has no jurisdiction to receive, try and hear this petition.
We are unable to accept these contentions. Turning to the first limb of the argument. Article 226. clauses (1) and (2) of the Constitution read as follows :
(1) Notwithstanding anything in Article 32, every High Court shall have power, throughout the territories in relation to which it exercises jurisdiction, to issue to any person or authority, including in appropriate cases, any Government, within those territories directions, orders or writs, including (writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari, or any of them, for the enforcement of any of the rights conferred by Part III and for any other purpose.)
(2) The power conferred by clause (1) to issue directions, orders or writs to any Government, authority or person may also be exercised by any High Court exercising jurisdiction in relation to the territories within which the cause of action, wholly or in part, arises for the exercise of such power, notwithstanding that the seat of such Government or authority or the residence of such person is not within those territories.
(emphasis supplied)
Hence clause (1) provides that within the State, the Court''s jurisdiction is co-terminus with the territories of the State, whilst clause (2) envisages the issue of writs beyond the Court''s territorial jurisdiction provided that the cause of action has arisen within the territorial jurisdiction of the Court concerned. In the present case, the tender notice and the impugned resolution were both issued within the territorial jurisdiction of this Court and by reason of Article 226 clause (1) the Bench at Nagpur would clearly have jurisdiction. The provisions of Section 41 of the Bombay Reorganisation Act, 1960 (Act No. 11 of 1960) read with Rule 127 of the Bombay High Court Appellate Side Rules cannot abridge the writ jurisdiction. We are fortified in this view by the observations in the case of Election Commission, India v. Saka Venkata Rao (AIR 1953 SC 210) wherein the Court was pleased to observe as follows :
The rule that cause of action attracts jurisdiction in suits is based on statutory enactment and cannot apply to writs issuable under Art. 226 which makes no reference to any cause of action or where it arises but insists on the presence of the person or authority "within the territories" in relation to which the High Court exercises jurisdiction.
Then again in dealing with the writ jurisdiction In Re: The Kerala Education Bill, 1957. Reference Under Article 143(1) of The Constitution of India, the Court was pleased to observe as follows :
Article 226 of the Constitution confers extensive jurisdiction and power on the High courts in the States. This jurisdiction and power extend throughout the territories in relation to which the High Court exercises jurisdiction. It can issue to any person or authority, including in appropriate cases any Government, within those territories, directions, orders or writs of the nature mentioned therein for the enforcement of the fundamental rights or for any other purpose.
(emphasis supplied)
The contention therefore that it is the cause of action that attracts jurisdiction must hence be negatived.
As regards the citation namely M/s Siku Industries and others v. Smt. C. D''Sonza (cited supra) is concerned, the facts in that case were that the petitioners therein were carrying on business at Nagpur and they failed to pay certain amounts under the Provident Fund. That a prosecution in respect thereof was launched at Bombay. The petitioners therein hence filed a petition for quashing the said proceedings on the basis that the Presidency Magistrate''s Court at Bombay had no jurisdiction to entertain the complaint. The contention canvassed on behalf of the respondents was that since the complaint was filed at Bombay, the writ challenging the complaint ought to have been filed in Bombay. Dealing with the subject matter of the said petition, the Court went on to hold that a material part of the cause of action had arisen at Nagpur and in the circumstances the Bench at Nagpur had jurisdiction to receive, try and hear the petition. Whilst the citation has been pressed into service for the purposes of reinforcing the argument that it is the place where the cause of action arises that must determine jurisdiction, it may be stated that in the said matter what was being considered were the provisions of Article 227 and not the provisions of Article 226. On the other hand, in the very judgment, there is a clear observation which reads as follows :
So far as the exercise of the powers under Article 226 of the Constitution is concerned, the mailer stands on a different looting. It empowers the High Court to issue to any person or authority, including in appropriate cases any Government directions, orders or writs for the enforcement of any of the behalf of the 1st and the 4th respondents that there was nothing wrong in the 1st respondent giving the contract to the 4th respondent since it was competent to the 1st respondent to reject all the tenders received by it and to negotiate directly with the 4th respondent for giving them the contract and it made no difference that instead of following this procedure, which perhaps might have resulted in the 4th respondent offering a smaller licence fee and the 1st respondent suffering a loss in the process, the 1st respondent accepted the tender of the 4th respondent. In dealing with this argument, the Court held that there was no force in this argument and further observed as follows:
But here the 1st respondent did not reject the tenders out-right and enter into direct negotiations with the 4th respondents for awarding the contract. The process of awarding a contract by inviting tenders was not terminated or abandoned by the 1st respondent by rejecting all the tenders but in furtherance of the process, the tender of the 4th respondent was accepted by the 1st respondent. The contract was not given to the 4th respondent as a result of direct negotiations. Tenders were invited and out of the tenders received, the one submitted by the 4th respondent was accepted and the contract was given to them. It is, therefore, not possible to justify the action of the 1st respondent on the ground that the 1st respondent could have achieved the same result by rejecting all the tenders and entering into direct negotiations with the 4th respondent.
Mr. Garud, the learned Assistant Government Pleader on behalf of the respondents Nos. 1 and 2, contended that the whole object of selling these items to small-scale industries was to assist small-scale industries in one manner or the other. That in distributing these two items amongst the three parties namely the petitioners and respondents Nos. 3 and 4, respondents Nos. 1 and 2 had acted fairly as the rates claimed from each of them were the same and there was no loss to the Government. That there was hence no question of quashing the said resolution. The learned counsel on behalf of respondent No. 3 contended that ordinarily respondent No, 3 ought to have got a lion''s share of the items but since respondents Nos. 1 and 2 had by their resolution distributed the items amongst the petitioners and respondents Nos. 3 and 4, the question of quashing the resolution did not arise. Counsel for respondent No. 4 also adopted the same line of argument as that of counsel for respondent No. 3 namely that since the two items were distributed amongst the three parties, there was no cause for quashing the resolution.
The arguments of counsel for respondents Nos. 1 and 2 and counsel for respondents Nos. 3 and 4 do not answer the crucial question, namely, whether it was proper on the part of respondents Nos. 1 and 2 having invited tenders to ignore the tenders and pass the resolution (now impugned). The act of respondents Nos. 1 and 2 in ignoring the tenders and then again without rejecting or terminating the same, proceeding to allocate the two items amongst the three parties by the said resolution dated 3rd August, 1984 must clearly be held to be bad in law. In view of this, the petitioners would be entitled to the relief prayed, namely, that the resolution dated 3-8-1984 be quashed.
The rule is, therefore, made absolute in terms of prayers (i) and (ii). There will however be no order as to costs.