FARAD CONTINUATION SHEET NO. IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD WRIT PETITION NO.3744 OF 2011 "M/s. Shivshambho Sugar & Agro Industries Ltd., Nanded through Chairman Vs. The State of Maharashtra and others." Office Notes, Office Memoranda of Coram appearances, Court's Orders Court's or Judge's orders or directions and Registrar's orders. 1 Mr. R.B. Raghuwanshi, Advocate holding for Mr. A.B. Girase, Advocate for petitioner. Mrs. A.V. Gondhalekar, AGP for respondent Nos. 1 and 2. Mr. S.S. Choudhari, Advocate for respondent No.6. Mr. R.N. Dhorde, Advocate for respondent Nos. 3 and 4. CORAM :- B.R. GAVAI & M.T. JOSHI, JJ. DATE :- 10TH OCTOBER, 2011. PER COURT :- 1] The petitioner challenges the decision of the respondent nos. 3 and 4, in issuing fresh tender notices for auctioning the respondent No.6 - Karkhana. The respondent No.6 is mortgaged with the respondent No.3. Since the dues of respondent No.3 were not paid by the respondent No.6, it was decided to auction the property of the respondent No.6. Accordingly, bids were invited. Initially 4 bids were invited, out of which one bidder withdrew his bid, as such, only 3 remained in the fray. Out of the remaining 3, the petitioner was the highest bidder. Subsequently, respondent No.3 decided not to accept the highest bid of the petitioner and took a decision to invite fresh tender. Being aggrieved by the said decision of the respondent FARAD CONTINUATION SHEET NO. IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD WRIT PETITION NO.3744 OF 2011 "M/s. Shivshambho Sugar & Agro Industries Ltd., Nanded through Chairman Vs. The State of Maharashtra and others." Office Notes, Office Memoranda of Coram appearances, Court's Orders Court's or Judge's orders or directions and Registrar's orders. 2 No.3, the petitioner is before this court. 2] Shri Raghuwanshi, learned counsel appearing on behalf of the petitioners, relying on Rule 2(a) of The Security Interest (Enforcement) Rules,2002, submits that the power to accept or reject a bid vests only with the Authorized Officer and not with the respondent No.3 bank. He, therefore, submits that the respondent No.3 bank had no jurisdiction to reject the highest bid of the present petitioner. 3] Shri Raghuwanshi, relying on two Division Bench judgments of this court, i.e. in the matter of “Konark Infrastructure Pvt. Ltd. UNR etc. Vs. Commissioner, Ulhasnagar Municipal Corporation and others” reported in 2003(2) Bom.C.R. 838, and, in the matter of “Ashwin S. Shah and others Vs. Municipal Corporation of Greater Bombay and others” reported in 2009 B.C.I.106, further submits that once the game was opened by the respondents, it was not permissible for them to change the terms and conditions. 4] By now it is a settled principle of law that while distributing public largesses the authorities should always adhere to the principles of fairness, equity, reasonableness and FARAD CONTINUATION SHEET NO. IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD WRIT PETITION NO.3744 OF 2011 "M/s. Shivshambho Sugar & Agro Industries Ltd., Nanded through Chairman Vs. The State of Maharashtra and others." Office Notes, Office Memoranda of Coram appearances, Court's Orders Court's or Judge's orders or directions and Registrar's orders. 3 rationality. While exercising jurisdiction under Article 226 of the Constitution of India, this court would only examine, as to whether the exercise of powers by the authorities is within the parameters as laid down aforesaid. Reference in this respect could also be made to the judgment in the case of “Tata Cellular Vs. Union of India” reported in 1996(6) SCC 651. Equally, this court would only be concerned with the decision making process and not the ultimate decision. 5] No doubt, at the first blush, though the arguments of learned counsel Mr. Raghuwanshi, that the power to reject the bid is only with the Authorized Officer, may sound attractive in view of the definition of the term “Authorized Officer” as defined under clause (a) or Rule 2 of the said Rules. However, it is to be noted that it is for recovery of dues of the respondent No.3 for which the auction was being held. It is also not in dispute that the Board of Directors of the respondent No.3 is the body in which the ultimate control of the affairs of the respondent No.3 vests. It will be difficult to digest the proposition that powers which are vested in an inferior authority, cannot be exercised by a superior authority. In any case, we have perused the resolution and the affidavit in reply. Sound and cogent reasons have been given in the affidavit in reply as to why the highest bid of the petitioner is not being FARAD CONTINUATION SHEET NO. IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD WRIT PETITION NO.3744 OF 2011 "M/s. Shivshambho Sugar & Agro Industries Ltd., Nanded through Chairman Vs. The State of Maharashtra and others." Office Notes, Office Memoranda of Coram appearances, Court's Orders Court's or Judge's orders or directions and Registrar's orders. 4 accepted and as to why it is found necessary that fresh bids are to be invited. It is a settled principle of law that it is not permissible for us to examine the sufficiency of the reasons, the only enquiry that is permissible is, whether reasons given for the decision are reasonable or rational. Undoubtedly, the reasoning given in the affidavit in reply cannot be said to be either irrational or unreasonable. It is also not the case of the petitioners that this has been done to suit some one. No allegations of malafides are either found in the petitioner nor such party, against whom malafides could be attributed, is joined as a party respondent to the petition. We, therefore, find that the decision taken by the respondent No.3 has been taken, taking into consideration, the interest of the bank i.e. getting a better price. 6] In so far as reliance on the judgment in the matter of “Konark Infrastructure” (supra) is concerned, we find that the said judgment would not be applicable to the facts of the present case, inasmuch as, in the said case, what has been held by the Division Bench of this Court is that if a particular condition is stipulated in the tender notice is to be relaxed , it has to be relaxed in case of all the tenderers and not in respect of a chosen few. Such is not the case here. FARAD CONTINUATION SHEET NO. IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD WRIT PETITION NO.3744 OF 2011 "M/s. Shivshambho Sugar & Agro Industries Ltd., Nanded through Chairman Vs. The State of Maharashtra and others." Office Notes, Office Memoranda of Coram appearances, Court's Orders Court's or Judge's orders or directions and Registrar's orders. 5 7] In so far as the judgment in the matter of “Ashwin S. Shah” (supra) is concerned, in the said case as well, the terms and conditions which were mentioned in the tender notice were changed mid way, that too, without informing all the tenders. Such is not the case here. Therefore, the said judgment would also not be applicable to the present petition. 8] In that view of the matter, we find that there is no substance in the petition. The same is summarily dismissed. [M.T. JOSHI,J.] [B.R. GAVAI, J.] grt/-