SBCWP NO.3992/2000. { 1 } IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JAIPUR BENCH, JAIPUR. O R D E R 1) S.B. CIVIL WRIT PETITION NO.3992/2000. M/s.R.S. Trading Co. Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. 2) S.B. CIVIL WRIT PETITION NO.4146/2000. M/s.Phool Chandra Ram Chandra Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. 3) S.B. CIVIL WRIT PETITION NO.4638/2000. M/s.Ram Kishore Jugal Kishore Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. 4) S.B. CIVIL WRIT PETITION NO.4602/2000. M/s.Naresh Kumar Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. 5) S.B. CIVIL WRIT PETITION NO.4600/2000. M/s.Siya Raj Trading Company Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. 6) S.B. CIVIL WRIT PETITION NO.4262/2000. M/s.Shri Nath Trading Co. Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. 7) S.B. CIVIL WRIT PETITION NO.4188/2000. M/s.Mahesh Trading Co. Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. 8) S.B. CIVIL WRIT PETITION NO.4148/2000. M/s.Om Prakash Tambi & Sons Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. 9) S.B. CIVIL WRIT PETITION NO.4147/2000. SBCWP NO.3992/2000. { 2 } M/s.Ramjilal Satyaprakash Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. 10) S.B. CIVIL WRIT PETITION NO.4119/2000. M/s.Jaipur Roller Flour Mills. Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. 11) S.B. CIVIL WRIT PETITION NO.4002/2000. M/s.Shankar Products Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. 12) S.B. CIVIL WRIT PETITION NO.4001/2000. M/s.Jain Bura Udyog Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. 13) S.B. CIVIL WRIT PETITION NO.4000/2000. M/s.Gayatri Trading Co. Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. 14) S.B. CIVIL WRIT PETITION NO.3993/2000. M/s.Ajay Associates Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. 15) S.B. CIVIL WRIT PETITION NO.3995/2000. M/s.Ganesh Udyog Vs. Krishi Upaj Mandi Samiti (Grain) & Ors. Date of Order : 25 January 2008. PRESENT HON'BLE MR.JUSTICE M.N. BHANDARI Shri Vigyan Shah and Shri H.S. Khandelwal for the petitioners. Shri D.P. Pujari for the respondents. **** BY THE COURT:- SBCWP NO.3992/2000. { 3 } Since bunch of writ petitions involved one and the same question and are based on identical facts thus, were heard together and are decided by this common judgment. 2) By this writ petition the petitioners have challenged the re-auction of the shops in dispute with the prayer that re-auction notice issued by the respondents be declared as illegal. Further prayer made by the petitioners is to direct the resondents to allot the shops to the petitioners pursuant to the first auction. 3) The learned counsel for the petitioners has contended that the respondents had issued an advertisement on 5/5/2000 in regard to the allotment of 32 vacant shops in Surajpole Mandi by auction. Pursuant to the auction notice, petitioners being license holders participated therein and being highest bidders, petitioners deposited requisite three months advance rent through cheques. However, possession of the shops was not delivered to them by the respondents for one or the other reasons. Subsequently, the respondents issued advertisement for re-auction SBCWP NO.3992/2000. { 4 } of those shops which were already auctioned earlier. Therefore, the petitioners have questioned the action of the respondents in regard to issuance of advertisement for re- auction. The main contention taken in the writ petition is that the respondents have failed to perform their duties as provided under Section 9 of the Agriculture Market Produce Act, 1961. The other plea taken by the petitioners is in regard to violation of principle of estoppel and of Article 14 of the Constitution of India inasmuch as, the respondents alleged to have acted like a private party and issued advertisement for re- auction of the shops, only to earn profit. 4) In the argument as well as written submission given by the petitioners, it has been urged that in view of the judgments of the Hon'ble Apex Court as well as of this High Court, action of the respondents becomes totally illegal in putting the shops for re-auction moreso when in the first auction the petitioners' bid was higher than the reserve price thus, not only the very basis for re-auction was not existing but SBCWP NO.3992/2000. { 5 } even otherwise re-auction cannot be allowed to get higher bid inasmuch as, mandi samities are not meant to earn profit. Elaborating the argument, counsel for the petitioners submitted that perusal of the document whereby a decision was taken to re-auction of the shops shows that same was precisely for the reason that the bid amount of the first auction was less than the reserve price whereas, it is a fact that the bid given by the petitioners was higher than the reserve price. Hence, for these reasons, counsel for the petitioners prayed for quashing of the notice for re-auction and all subsequent proceedings. The additional ground taken by the learned counsel for the petitioners is that even perusal of re-auction notice shows that those who were not having license were also allowed to participate whereas as per the provisions of the Act of 1961, a trader who is not possesing the license cannot be allowed to work in the mandi yard thus, permitting participation of non- licencees is again illegal moreso when petitioners are license holders and doing their SBCWP NO.3992/2000. { 6 } business for last so many years. 5) Learned counsel for the respondents on the other hand, supported the action. It is contended by the learned counsel for the respondents that the shops in question were put for re-auction mainly for the reason that it could not fetch the fair price as would be clear from bare perusal of order at Annexure.R.7 dated 21/6/2000. It was urged that re-auction was not ordered for the reason that in the first auction, the bid given by the parties were less than the reserve price. In fact, re-auction was ordered considering the reserve price and the bid given as bid were not found to have earned proper revenue. So far as the notice for re-auction permitting even those who are not holding license is concerned, it was contended that in the order dated 21/6/2000 itself, it was made clear that if other than license holders participate in the auction, they would require to obtain license before taking possession of the shops. Thus, according to the respondents, the shops which were to be allotted only to those who ultimately SBCWP NO.3992/2000. { 7 } holds license. 6) Further contention of the learned counsel for the respondents is that it is not a case where principle of estoppel applies because auction of the shops always remain subject to condition of acceptance hence, without acceptance of the bids and consequential order of allotment, question of principle of estoppel does not arise and so as violation of Article 14 of the Constitution of India is concern, the action of the respondents is not discriminatory in nature rather even in the re-auction, the petitioners are also permitted to participate. It is further argued that petitioners cannot question re- auction on the ground that auction of such properties was not even permissible in view of the judgments of Supreme Court and this court wherein it was held that mandi committees are not there to earn profits thus, allotment of shops should not be made by auction however, when petitioners themselves are claiming their rights pursuant to auction therefore, beneficiary of the auction cannot challenge re-auction on the SBCWP NO.3992/2000. { 8 } aforesaid ground. Thus, it was prayed that writ petitions preferred by the petitioners may kindly be dismissed. 7) I have considered the rival submissions of the parties and gone through the record as well as the judgments cited by the petitioners. 8) The first contentention of the petitioners is that in the light of the judgments of the Hon'ble Apex Court reported in (1997)1 SCC 227 : Bhagwan Das Sood Vs. State of H.P. and others, the respondents cannot auction the shops thus, action of the respondents to put the shops for auction to earn profit is against the very object of the Act of 1961 and in view of the judgment supra, the action of the respondents becomes illegal. 9) Learned counsel for the petitioners drawn my attention to paras 32, 33, 35 and 36 of the aforesaid judgment to show that in view of the decision of the Hon'ble Apex Court, the respondents are under an obligation not only to provide necessary infrastructure to all concern who are doing their business and while doing so, SBCWP NO.3992/2000. { 9 } necessary benefit can be given only to those who are having license. Perusal of the judgment shows that it was a case where the Hon'ble Apex Court was concern with the issue as to whether one is required to possess the license for doing the work in the mandi yard. The Hon'ble Apex Court came to the conclusion that merely for the rason that somebody is paying market fee, does not mean that he is absolved from the duty of obtaining license and even if somebody is exempted from payment of fee then also, he is under an obligation to obtain the license. The Hon'ble Apex Court further held that if market fee is charged by the samiti then, they are under an obligation to provide service because fee is necessarily related with the services rendered. Thus, the issue in the aforesaid case was pertaining to payment of market fee and consequential rights as to whether one is required to obtain the license or not. The other judgment cited by the learned counsel for the petitioners is reported in 1998(5) SCC 207 : Labha Ram and Sons Vs. State of Punjab wherein, SBCWP NO.3992/2000. { 10 } the Hon'ble Supreme Court held that creation of new mandi complex and allotment of plots/shops in the new complex, the government has inherent obligation to provide sufficient accommodation to all the existing licensed dealers and such obligation will not stand discharged merely by allowing them to compete with the outsider in open auction. In the aforesaid judgment, the Hon'ble Apex Court came to the conclusion that earning of revenue is not an objective for the government while acquiring land for establishing a new mandi. Considering aforesaid judgment, Division Bench of this court in M/s.Ved Prakash Ramesh Chand and Company and others Vs. State and others : 2002(3) WLC 207 held that mandies are not established to generate revenue thus, action of the State Government for putting the shops for auction was held to be unjustified. In this regard, reference of paras 25 and 26 is material. 10) Taking note of the judgment referred above, it comes out that mandi samiti cannot auction the shops for earning profits rather in view of the judgment of the Division Bench SBCWP NO.3992/2000. { 11 } referred to above, the shops cannot be put for auction for the reason that the State Government is under an obligation to take into account the handicaps of the exceeding dealers who are subjected on account of creation of new mandis as there is bar of doing business outside the mandi yard and the only avenue provided to the traders is to get the shops through allotment. 11) The fact now remain that if the auction of the shops are not permissible as canvassed by the petitioners then they being the claimants of shops pursuant to the auction cannot claim such benefits and if petitioners sustain their claim pursuant to the first auction then re-auction cannot be challenged by the petitioners. On querry raised from the counsel for respondents, it was given out that looking to the fact that number of the shops are less than required hence if shops are allotted by the authorities at their own, a voice of arbitrariness along with the allegations may be raised. Hence, to have transparency in the action, the auction is found to be the best mode which otherwise is not for SBCWP NO.3992/2000. { 12 } the purpose of earning profit because even if higher price is quoted by some one, money received by mandi samiti is utilised for the benefits of agriculturists and mandi itself therefore, through out Rajasthan, shops are genrally allotted through auction. 12) Looking to the facts of this case, it becomes clear that auction and re-auction is an event of year 2000 and pursuant to the interim- order the shops could not be utilised and precisely for that reason the matter was taken up for hearing on priority basis. Now, since more than a period of seven years has passed by now and the things have changed a lot during the intervening period. 13) In view of above, the respondents authorities are given direction not to act upon either auction or re-auction but to take a decision in regard to the allotment of shops in the light of the judgment supra. However, while making allotment of the shops by proper and legal method pursuant to this judgment, respondents should not permit participation of those who are SBCWP NO.3992/2000. { 13 } not license holders inasmuch as, respondents have committed an illegality by permitting even those who are not having license. 14) The view taken above will otherwise take care of the grievance of the petitioners that non-licensee have also been permitted to participate in the re-auction and at the same time since petitioners have pressed the issue that shops cannot be put for auction by the mandi samiti then they themselves cannot claim their rights arising out of the auctions because they cannot blow hot and cold simaltaneously. 15) All the writ petitions are accordingly disposed of with the following directions:- (i) The respondents are directed to re-consider the issue of allotment of all the shops involved in the present matter by framing a policy in regard to allotment of shops which must have transparency and keeping in mind the object of the Act of 1961. After framing SBCWP NO.3992/2000. { 14 } of such scheme, the allotment of shops involved in the present matter may be made. (ii) Looking to the fact that for last seven years shops are lying vacant thus, efforts should be made to make allotment of those shops at the earliest and for that purposes if need be respondents would be at liberty to constitute a committee so that a policy framed as per the direction above. Then, same may be implemented properly without a voice of arbitrariness. (iii) The respondents are directed not to give effect to the auction and re- auction of year 2000 of the shops involved in the present matter and while making allotment based on some policy decision, only those who are having licences are alone be considered and non- licensee should not be considered for SBCWP NO.3992/2000. { 15 } making allotment of shops. (iv) If it is found that even as per policy, number of persons seeking allotment are greater than the number of shops existing then, if any policy is taken to fetch more price then the revenue earned in that regard should not be treated as profit but be utilised for the welfare and interests of the agricultarists and mandi yard samiti thereby, if respondents adopt the method to allot the shops by fetching more price, the direction aforesaid should taken note of. With the aforesaid directions, all these writ petitions are disposed of. (M.N. BHANDARI), J. anil