M/S. Karnataka State Forest ... vs M/S. Indian Rocks

3. Appellant is a Government of Karnataka Undertaking engaged in sale of granite of seized and confiscated granite blocks to persons who intend to purchase in the Tender-cum-Allotment sale on "as is where is basis". The relevant terms of the said tender were:

18. The successful Tenderer/Bidder shall make their own arrangements for inspection of seized and confiscated Granite blocks at their own cost located at different places in the Ranges as the offer for sale is on. AS IS WHERE IS BASIS.

5. The total sale value of the granite sold to the respondent herein was Rs. 21,24,574.85. Out of the aforementioned sum, admittedly, the respondent on or about 11.07.1995 had deposited a sum of Rs. 11,84,447.90. The balance amount due to the appellant from the respondent was Rs. 9,40,126.55. In terms of the said tender, the respondent was required to pay not only 10% of the value of the goods but also taxes and 4 5 other statutory dues paid by the appellant herein. Appellant has paid an amount of Rs.6,85,642/- being the royalty amount, Forest Development Tax, Karnataka Sales Tax and Surcharge on Karnataka Sales Tax etc.

10. It is, however, stated that the appellant did not agree to the aforementioned suggestions/direction of the State and responded thereto stating that it was not feasible to refund the sale price. It had been stated that necessary permit should be directed to be issued in this behalf. By its letter dated 2.12.1996, appellant requested the respondent to remit the balance amount, stating:

11. However, the said request was not acceded to. Appellant allegedly issued various other letters to the same effect on 29.01.1997, 25.04.1997 and 30.06.1997. Ultimately by its letter dated 5.06.1999, the appellant informed the respondent to immediately remit the amount and lift the granite blocks by 30.06.1999 failing which, it was threatened, the amount deposited shall be forfeited, stating:

24. Pursuant to or in furtherance thereof a representation for refund of Rs.1,51,594.05 ps. was made. However, the appellant by its letter dated 15th November, 1999 rejected the said request. Aggrieved, the third respondent filed a writ petition before the High Court which was numbered as W.P. 45825 of 1999 praying inter alia for the following reliefs :-

22. Another writ petition being W.P. (C) No. 7611 of 1997 was filed by respondent No.3 to refund the payment made by it amounting to Rs.5,54,593/- with interest and further not to insist for making payment of balance bid amount.

ii) issue a writ of mandamus or any other writ order or direction directing the 3rd Respondent to refund a sum of Rs.1,51,594.05 with interest @ 18% per annum from the date of deposit till the date of refund.

iii) issue a writ of mandamus or any other writ order of direction directing the respondents 1 and 2 to refund a sum of Rs.95,088.60 deposited by the 3rd Respondent on account of Forest Development Taxes on the unreleased granite blocks.

v) issue a writ of mandamus or any other writ order or direction directing the Respondent No. 6 to refund the sum of Rs.1,78,290.60 deposited by the 3rd Respondent on account of Income Tax on the unreleased granite blocks.

26. A learned Single Judge of the High Court by his order dated 26th September, 2002 allowed the writ petition. While quashing the letter dated 15th November, 1999 directed to refund the moneys stated at Prayer Nos. 2, 3,4 and 5 of the petition.

Aggrieved, the appellant filed a writ appeal which was dismissed by the impugned order.

31. We agree with the contention of Mr. Divan that such a direction which does not have any statutory force is not binding upon the appellant but herein strictly we are not concerned with such an issue. 22 23

45. Keeping in view the facts and circumstances of the case in its entirety and having regard to the legal propositions as noticed hereinbefore, we are of the opinion that these are not the cases in which this Court should exercise its discretionary jurisdiction under Article 136 of the Constitution of India. The appeals are dismissed with costs. Counsel's fee assessed at Rs.50,000/- in each case.

......J. 30 31 ( S.B. SINHA ) ....................................J. ( CYRIAC JOSEPH ) New Delhi October 24, 2008 31 32 IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. OF 2008 [Arising out of SLP (Civil) No. 24242 of 2005] M/s. Karnataka State Forest Industries Corporation ...Appellant Versus M/s. Indian Rocks ...Respondent WITH CIVIL APPEAL NO. OF 2008 [Arising out of SLP (Civil) No. 23148 of 2005] Dear Brother Cyriac Joseph, Draft Judgment in the aforementioned matter is being sent herewith for your perusal and kind consideration.

With kind regards, [S.B. Sinha] J.

New Delhi;

September 15, 2008 32 33 Hon'ble Mr. Justice Cyriac Joseph 33