Summarize the following court judgment. ON: Civil Appeal Nos. 2076 2078 of 1990. From the Judgment and Orders dated 25.8. 1989	 10.11.1989 & 5.9. 1989 of the Bombay High Court in W.A. Nos. 2198	 3377 and 2197 of 1989. D.N. Dwivedi and Sarva Mitter for the Appellants. Arun Jetley	 Additional Solicitor General	 Raian Karan jawala	 H.S. Anand	 Nandini Gore	 Ravi Kumar	 M. Karanjawa la	 V	N. Patil and A.S. Bhasme for the Respondents. The Judgment of the Court was delivered by 828 RANGANATH MISRA	 J. Special leave granted. Three applications were filed under Article 226 of the Constitution before the High Court of Bombay by the respec tive appellants before us challenging the rejection of their highest offers in response to invitation by public tender without assigning any reason for the same as arbitrary	 unconstitutional and contrary to rule of law. The respondent a Government company within the meaning of section 617 of the Companies Act has been constituted as the New Town Development Authority under sub section (3A) of section 113 of the Maharashtra Regional Town Planning Act	 1966. The respondent is empowered to dispose of land vested in it and the respondent has formulated with the approval of the State Government under section 159 of the said Act a code for regulat ing	 inter alia disposal of land. Regulation 4 provides: "The Corporation may dispose of plots of lands by putting to auction or considering the individual applications as the Corporation determines from time to time." According to the appellants the normal practice adopted by the Corporation is to invite tenders for the disposal of specified plots which the Corporation chooses to assign according to the terms and conditions for lease of plots for mercantile use. The appellants maintained that they had given the highest offers by way of tender for certain speci fied plots by complying with the requirements of deposit and claim that though the offers were the highest	 yet the same have not been accepted. Each of the appellants was before the High Court challenging the action of respondent No. 1 but the writ petitions were dismissed in limine by saying that there was no arbitrariness in the respondent No. 1 trying to get proper price for its plots. It is not disputed that the scheme which is operating provides that "respondent No. 1 reserves the fight to amend	 revoke or modify the scheme at its discretion as well as to reject any or all offers for allotment without assigning any reason. " Obviously it is in exercise of this power that the highest tenders have not been accepted. It is the contention of Mr. Dwivedi appearing in support of these appeals that the respondent is 'State ' under Arti cle 12 of the Constitution and conferment of naked and unguided power as referred to above is arbitrary and con trary to the provisions of Article 14 of the Constitution; and since there is no prescribed norm or guideline and he power is unregulated and unfettered and the highest offer after complying with the prescribed requirements is avail able to be rejected 829 without assigning any reasons	 citizens are likely to be affected by exercise of such uncanalised power. Shortly put	 Mr. Dwivedi submits that the procedure is contrary to the requirement of rule of law and therefore	 cannot be sus tained. An affidavit in opposition has been filed on behalf of respondent No. 1 wherein the circumstances under which the highest offers have not been accepted has been indicated and the position has been explained. We do not find it difficult to agree with Mr. Dwivedi 's submissions that respondent No. 1 is 'State ' within the meaning of article 12 and in its dealings with the citizens of India it would be required to act within the ambit of rule of law and would not be permitted to conduct its activities arbitrarily. It is too late in the day for an institution like respondent No. 1 to adopt the posture that the activity in question is commercial and as respondent No. 1 is engaged in trading activity it would be open to it to act as it considers appropriate for the purpose of protecting its business interest. An instrumentality of the State as has been laid down by this Court in a series of authoritative decisions beginning with R.D. Shetty vs International Air port Authority of India & Ors.	 and in Ajay Hasia vs Khalid Mujib Sehravardi	 ; and a number of decisions thereafter has to act within the ambit of rule of law and would not be allowed to conduct itself arbitrarily and in its dealings with the public would be liable to judicial review. The State is certainly entitled to look for the best deal in regard to its properties. This has been accepted by several decisions of this Court with reference to State action under the Excise Laws. There is no allegation of mala fides in the conduct of respondent No. 1 in refusing to accept the highest offer. We must	 therefore	 proceed on the footing that respondent No. 1 acted bona fide and in refus ing to accept the highest offers of the appellants in regard to specific plots has been actuated by the consideration of looking for better offers for the specific plots in the economic interest of respondent No. 1. The question which still remains to be answered is as to whether when the highest offer in response to an invitation is rejected would not the public authority be required to provide reasons for such action? Mr. Dwivedi has not asked us to look for a reasoned decision but has submitted that it is in the interest of the public authority itself	 the State and every one in the society at large that reasons for State action are placed on record and are even communicated to the persons from whom the offers came so that the dealings remain above board; the interest of the public authority is adequately protected and a citizen knows where he stands with reference to his offer. What this Court 830 said in State of U.P.v. Raj Narain & Ors.	 ; may be usefully recalled here: "In a government of responsibility like ours	 where all the agents of the public must be responsible for their conduct	 there can be but few secrets. The people of this country have a right to know every public act	 everything that is done in a public way	 by their public functionaries. They are entitled to know the particulars of every public trans action in all its bearing. The right to know	 which is derived from the concept of freedom of speech	 though not absolute	 is a factor which should make one wary	 when secrecy is claimed for transactions which can	 at any rate	 have no repercussion on public security. To cover with veil of secrecy	 the common routine business	 is not in the interest of the public. " In recent times	 judicial review of administrative action has become expansive and is becoming wider day by day. The traditional limitations have been vanishing and the sphere of judicial scrutiny is being expanded. State activi ty too is becoming fast pervasive. As the State has descend ed into the commercial field and giant public sector under takings have grown up	 the stake of the public exchequer is also large justifying larger social audit	 judicial control and review by opening of the public gaze; these necessitate recording of reasons for executive actions including cases of rejection of highest offers. That very often involves long stakes and availability of reasons for action on the record assures credibility to the action; disciplines public conduct and improves the culture of accountability. Looking for reasons in support of such action provides an opportuni ty for an objective review in appropriate cases both by the administrative superior and by the judicial process. The submission of Mr. Dwivedi	 therefore	 commends itself to our acceptance	 namely	 that when highest offers of the type in question are rejected reasons sufficient to indicate the stand of the appropriate authority should be made available and ordinarily the same should be communicated to the con cerned parties unless there be any specific justification not to do so. We do not intend. to go into matters any further in as much as we do not propose to apply this test to the present appeals. These appeals fail but we make no order as to costs. P.S.S. Appeals dismissed.

The appellants had given the highest offers for certain specified plots for lease in response to invitation by public tender by the respondent Corporation a Government Company	 and complied with the requirements of deposit. The respondent	 however	 rejected the said offers without as signing any reason. The appellants challenged the action of the respondent before the High Court as arbitrary	 unconstitutional and contrary to rule of law. The High Court	 dismissed the writ petitions in limine. In these appeals by special leave	 it was contended for the appellants that the respondent Corporation was a 'State ' under Article 12 of the Constitution	 that the power of rejection of offers without assigning any reason was unregu lated and unfettered	 contrary to the requirement of rule of law	 and that it was in the interest of the public authority itself	 the State and everyone in the society at large that reasons for State action are placed on record and or even communicated to the persons from whom the offers came. 827 Dismissing the appeals	 the Court	 HELD: 1. The respondent No. 1 was 'State ' within the meaning of Article 12 of the Constitution and in its deal ings with the citizens of India	 it would be required to act within the ambit of rule of law and would not be permitted to conduct its activities arbitrarily. [829B C] R.D. Shetty vs International Airport Authority of India Sehravardi; 	 	 referred to. 2. The State is certainly entitled to look for the best deal in regard to its properties. In the instant case	 there was no allegation of mala fides in the conduct of respondent No. 1 in refusing to accept the highest offers. It could	 therefore	 be presumed that in so doing the respondent had been actuated by the consideration of looking for better offers for the specific plots in its economic interest. There was thus no arbitrariness in respondent trying to get proper price for its plots. [829E F	 828E F] 3. When highest offers of commercial nature are rejected reasons sufficient to indicate the stand of the public authority should be made available and the same should be communicated to the concerned parties unless there be any specific justification not to do so. That would assure credibility to the action	 discipline public conduct and improve the culture of accountability and provide an oppor tunity for an objective review in appropriate cases both by the administrative superior and by the judicial process. [830F G	 E F] State of U.P. vs Raj Narain & Ors.	 ; 	 re ferred to.