JUDGMENT
G.S. Singhvi, J.
1. In this petition, the petitioner has prayed for quashing communications dated 21.4.2004 and 22.4.2004 (Annexures P-7 and P-8) issued by Senior Regional Manager and the Manager (Sales) of Food Corporation of India, Haryana Region (for short, ‘the Corporation’), respectively in the matter of disposal of free stock of Bajra at the rates offered by the tenderers. It has further prayed for issuance of a writ in the nature of mandamus directing the respondents to allow it to lift the said stock at the cut-off rate i.e. Rs. 330/- per quintal specified in letter dated 24.3.2004 (Annexure P3).
2. The facts:- In response to the Notice Inviting Tenders (Annexure P1) for short, ‘the NIT’) issued by the Corporation for disposal of 198669 Mt. Tonnes of Bajra of Kharif 2003-2004 lying in various depots of the Government of Haryana and its agencies, the petitioner and 51 others submitted their tenders. The petitioner offered to purchase Bajra lying at various centers/depots/godowns in District Gurgaon (F.C.I. District) by quoting rates ranging from Rs. 345.55 to Rs. 401.55 per quintal. Similar offers were made by other tenderers. The competent authority of the Corporation approved the cutoff rate of Bajra for State of Haryana @ Rs. 330/- per quintal. This was conveyed by the Manager (Sales) (Headquarters) to the Zonal Manager of the Corporation vide letter dated 24.3.2004 (Annexure P3/ Annexure R1). The tenders submitted by the petitioner and others were opened in the first week of April, 2004. Vide letter dated 13.4.2004 (Annexure P5), District Manager, Haryana Agro Industries Corporation Ltd., informed the petitioner that its tender had been accepted for 15259 Mt. Tonnes of Bajra at a total cost of Rs. 5,42,47,473/-. Similar communications were sent to the other tenderers. Accordingly, they lifted Bajra after paying price at the cut-off rate. After some-time, Senior Regional Manager of the Corporation sent letter Annexure P7 dated 21.4.2004 to the petitioner and 51 other tenderers and offered free-stock of Bajra (26623 Mt. Tonnes) at the rates already offered/accepted by them. On the next day i.e. 22.4.2004, Manager (Sales) of the Corporation (Headquarters) sent letter Annexure P8 to the Senior Regional Manager and conveyed that unlifted/unallotted stock be offered to the tenderers at the cut-off price on pro rata basis, who had quoted price less than the cut-off price. In response to letter Annexure P7, thirty three of the tenderers offered to purchase the free stock at the rates originally quoted by them. The petitioner was not one of them. Rather, vide letters dated 27.4.2004 and 30.4.2004 (Annexures P9 and P10) (addressed to the Managing Director and Senior Regional Manager of the Corporation), the Chairman of the petitioner claimed that in terms of the approval granted by the competent authority which was conveyed vide letter dated 24.3.2004 (Annexure P3), it should be allowed to lift the free stock at the cut-off rate of Rs. 330/- per quintal.
3. The petitioner has averred that in view of the unequivocal promise made by the Corporation vide letter dated 24.3.2004 that free stocks will be offered to the tenderers at the cut-off rate, the respondents are bound to offer the free stock at the said rate and cannot ask for fresh offers or purchase at the originally quoted price. It has invoked the doctrine of equality enshrined in Article 14 of the Constitution and averred that the decision of the competent authority not to allow the lifting of free stock of Bajra at the cutoff rate is discriminatory and violative of Article 14, in-as-much as, in the year 20022003, the Corporation had allowed the tenderers to purchase the free stock of wheat at the cut-off rate. It has further averred that by having agreed to offer the stock of Bajra at the cut-off rate of Rs. 330/- per quintal with a stipulation that the tenderer may lift the free stock as per their requirement, the respondents will be deemed to have made a promise to the petitioner to offer the free-stock irrespective of its quoted price and they cannot now refuse permission to lift the free-stock of Bajra at the rate of Rs. 330/- per quintal.
4. The stand taken by respondent Nos. 1 to 3 is that the decision to dispose of free stock at the rates quoted by the tenderers has been taken in view of the larger financial interest of the Corporation and the petitioner cannot insist on purchasing the said stock at the cut-off rate of invoking the provisions of Article 14 of the Constitution. In the written statement filed on behalf of respondent No. 2, it has been averred that in response to letter dated 21.4.2004, thirty three of the tenderers have offered to purchase at the quoted rates and nine other persons have offered to purchase free-stock of Bajra. It has been further averred that the petitioner cannot claim exclusive right to purchase the free stock of Bajra at the cut-off rate when other parties have quoted as high as Rs. 357/per quintal. Along with the written statement, respondent No. 2 has placed on record letter dated 30.4.2004/ 1.5.2004 sent by Deputy Manager (Commercial), Haryana Region to the Manager (Sales) (Headquarters) of the Corporation conveying the substance of the discussion which took place in the meeting held on 17.4.2004 between other agencies and functionaries of the Government of India as well as Government of Haryana. The extract of paragraph 2 of that letter, which has bearing on the decision of this case, is reproduced below:
“One of the Agenda items was to dispose off the left over quantities of Bajra. It was informed by SRM in the meeting that the leftover quantities will be offered as soon as clarification from the Headquarters is received. On this, Shri Sanjay Kaul, I.A.S. informed that there was no reason for confusion as left over quantities were to be offered at the quoted rates of the parties which have been accepted being the highest for a particular lot. As no clarification was being received from the Headquarters despite sending reminders of even number dated 6.4.2004 and 12.4.2004 and to prevent deterioration of stocks and as a sequel to the discussions with the State Agencies, it was decided on 19.4.2004 to ask the parties, who had offered the rates above the cut off price of Rs. 330/.- per qtl. (excluding those who had either resiled or had applied for the refund of earnest money) to indicate the center-wise quantity (out of the free stocks) which they were interested to purchase at the rates already offered/accepted, whichever is higher. Communications in this regard were sent to the parties concerned on 21.4.2004 by registered post and in response thereto, some of the parties have offered to purchase the stocks of Bajra at their already quoted or accepted rates, the details of which are given in the annexure enclosed. Keeping in view the rates being received against our communications, referred to above, it is expected that the free stocks of Bajra (26,623 MTs.) can be disposed off at the rates over and above the cut off price of Rs. 330/- per qtl.”
5. Before adverting to the arguments of the learned counsel for the parties, we consider it proper to mention that after filling of the written statement, the respondents filed CM. 8891 of 2004 for placing on record copy of letter dated 5.5.2004 sent by Director, Ministry of Consumer Affairs, Food and Public Distribution Department, Government of India to the Managing Director of the Corporation that till the decision is taken by the High Level Committee (for short ‘HLC’), the instructions issued vide letter dated 22.4.2004 be withdrawn. The CM. was allowed on 18.5.2004 and a direction was issued to the counsel for the respondents to communicate the decision taken by the HLC. On the next date of hearing i.e. 27.5.2004, the Court suo motu impleaded Union of India as respondent No. 4 and asked its counsel to get in touch with the concerned Secretary and make a statement about the decision of the HLC. On 29.5.2004, Shri Gurpreet Singh placed on record copy of letter dated 28.5.2004 sent by Under Secretary to the Government of India, Ministry of Consumer Affairs, Food and Public Distribution Department with the request to seek extension of time to enable the Ministry to take appropriate decision. The case was then listed during summer vacation and vide order dated 8.6.2004, the Court reiterated the earlier direction for placing the decision of the HLC before it. Thereafter, copy of letter dated 2.7.2004 sent by Director, Ministry of Consumer affairs, Food and Public Distribution, Department of Food and Public Distribution, Government of India to Shri Gurpreet Singh, Additional Central Government Standing Counsel was placed on record along with CM. No. 11248 of 2004. For the sake of reference, the relevant portion of letter dated 2.7.2004 is reproduced below:-
“I am directed to refer to the Punjab and Haryana High Court’s order dated 8th June, 2004 in the above mentioned case and to say that the High Level Committee (HLC) of the FCI in its meeting held on 14.5.2004 had recommended that the free stocks of Bajra in Haryana may be offered to the tenderers at their approved quoted rates in the descending order of their rates quoted. The Competent Authority in this Ministry has approved the above approval of the HLC with the stipulation that the rates should be accepted if they are above the cut-off rates. In the tender for the sale of Bajra in Haryana opened on 3rd January, 2004 all rates of tenders above the cut off rates of Rs. 330/- per quintal were approved. As such, in pursuance of the above recommendations of the HLC and approval of the Competent Authority, the free stocks of Bajra are now to be offered to the tenderers who had quoted their rates above Rs. 330/- per quintal in the tender opened on 3.1.2004. The FCI has been instructed to take necessary action in accordance with the approval of the Competent Authority.”
6. Shri M.L. Sarin, Senior Advocate appearing for the petitioner criticized the con- tents of letter dated 2.7.2004 by arguing that after having assured the Court that appropriate decision in the matter of fixation of price of the free stock will be taken by the HLC of the Ministry, the respondents cannot rely on the decision taken by the so-called HLC of the Corporation to dispose of free-stocks at the originally quoted rates. He then argued that the decision of the Corporation not to offer the free stock at the cut off rate is wholly arbitrary, discriminatory and violative of Article 14 of the Constitution of India and is liable to be quashed because in the past, the Corporation has been disposing the free-stocks at the cut-off price. Shri Sarin also invoked the doctrine of promissory estoppel and argued that after having held out an unequivocal promise to the petitioner to offer the free-stock at the cut-off rate as per its requirement, the respondents cannot insist on payment of originally quoted rates. In support of this argument, Shri Sarin relied on the judgment of a Division Bench of this Court in M/s Nestle India Limited and Anr. v. State of Punjab, (1998-3)120 P.L.R 367 which, according him, has been approved by the Supreme Court.
7. Shri Anil Malhotra, learned counsel for the respondent Nos.l to 3 argued that the decision to offer free stock of Bajra at the price originally quoted by the tenderers has been taken in public interest and the petitioner cannot seek a direction for being allowed to lift the free stock at the cut-off rate of Rs. 330/- per quintal. Shri Malhotra pointed out that the rates quoted by majority of thirty three tenderers, who have responded to letter dated 21.4.2004 (Annexure P7) are much more higher than the cut-off rate and argued that the petitioner cannot claim unjust enrichment at the cost of public exchequer. He relied on the judgment of the Supreme Court in Jespar I. Slong v. State of Meghalaya and other, J.T. 2004(5) S.C. 107 and argued that the decision taken by the respondents to offer the free-stock of Bajra at the originally quoted rates does not suffer from any legal infirmity warranting interference under Article 226 of the Constitution of India.
8. We have given serious thought to the respective arguments, a reading of Annexure P3/Annexure Rl gives an impression that while approving the cut-off price as Rs. 330/- per quintal, the Corporation had decided to offer the free stock to the tenderers, whose rates had been accepted,to the extent of their requirement and they were to be given option to lift the stock at the cut-off rate, but the same cannot be treated as an unequivocal promise made to the tenderers for sale of free stock of Bajra at the cut-off rate and the decision taken by the HLC of the Corporation to offer the free stock at the price quoted by the tenderers cannot be termed as arbitrary, unreasonable or discriminatory. Rather, the impugned decision is in larger public interest. Shri Sarin’s criticism of the action taken by the Ministry to approve the cut-off price fixed by the HLC of the Corporation is not well founded. A reading of various order sheets of the case shows that at no stage, the respondents had given an assurance to the Court that decision on the cut-off price of free stock Bajra would be taken by the HLC of the Ministry. The contents of letter dated 30.4.2004/1.5.2004 sent by Deputy Manager (Commercial) to the Manager (Sales) shows that the decision on the cut-off price had to be taken by the Corporation and not by the government. Therefore, it is not possible to nullify the fixation of cut-off price only on the ground that the same has been determined by the HLC of the Corporation, more-so because the recommendation of the HLC of the Corporation has been approved by the concerned Ministry of the Government of India.
9. There is another reason for our disinclination to interfere with the cut-off price fixed by the respondents. The petitioner has not controverted the assertion contained in the written statement filed on behalf of respondent No. 2 that in response to letter dated 21.4.2004 (Annexure P7), thirty three of the tenderers have come forward to lift the free stock and most of them have offered price much more higher than the cut-off rate of Rs. 330/- per quintal. It is, thus, clear that by disposing of the free stock of Bajra at the rates quoted by the tenderers, the Corporation will be able to earn crores of rupees. This necessarily means that if the petitioner is allowed to lift the free stock at the cut-off rate, the Corporation would suffer loss of crores of rupees. Therefore, we do not find any justification to exercise jurisdiction of the Court under Article 226 of the Constitution of India in favour of the petitioner.
10. In Jespar I Slong v. State of Meghalaya and Ors. (supra) the Supreme Court, while setting aside the judgment of Gauhati High Court which had allowed the claim of the writ petitioner, observed as under:-
“Payment of bid amount is purely a matter between the contractor and the State. As a matter of fact obtaining higher revenue by accepting the eligible highest bid would only be in public interest because State stands to gain more revenue. The offering of the bid after knowing the commercial value of the contract is a matter left to the business acumen or prudence of the tenderer. No third party’s interest is involved in such contract. Therefore, in our opinion, application of principle of predatory pricing is wholly alien to this type of contract. Mere offer of a fancy or high bid by itself does not make the bid predatory bid in this type of contract. If the State decides to give its largesse to public it has an obligation to see that it fetches the best possible value for the same, provided otherwise it does not in any manner affects the rights of other citizens. No bidder has any right in law to demand the State to give away its largesse for an amount which he considers to be reasonable even when there are bidders willing to pay more for it. Principal of monopoly also does not come into play in these types of contracts.”
11. The doctrine of promissory estoppel cannot be invoked in the present case for compelling the Corporation to issue free stock of Bajra to the petitioner at the cut-off price because the petitioner has neither pleaded nor any material has been placed on the record of the writ petition to show that any promise was made by the competent authority that after execution of the contract, it would be allowed to lift free-stock of Bajra at the cut-off rate and in pursuance of the said promise, the petitioner had altered its position by spending large amount in making arrangement for lifting of the free stock of Bajra or that it had entered into contract with third party for disposal of Bajra. To put it differently, the so-called promise made by the Corporation did not result any change of the petitioner’s position in any manner whatsoever. Therefore, it is not possible to issue a mandatory direction to the concerned authority of the Corporation to offer free stock of Bajra to the petitioner at the cut-off price.
12. We are further of the view that in the contractual matter, like this, the doctrine of promissory estoppel cannot be applied for nullifying a policy decision taken in the larger public interest. In Amrit Banaspati Co. Ltd., v. State of Punjab, A.I.R.1992 S.C. 1075, the Supreme Court refused to apply the doctrine of promissory estoppel by observing that the decision taken by the government to refund the amount of sales tax was opposed to the public policy.
13. In Kanishka Trading and Anr. v. Union of India, A.I.R. 1995 S.C.874, a two Judges Bench of the Apex Court declined to invoke the doctrine of promissory estoppel to sustain the claim of the petitioner for continued grant of exemption from the payment of custom duty. The appellant relied on notification dated 15.3.1979 issued by the Central Government granting exemption from payment of custom duty on polyvinyl chloride resin for a period of two years. However, before the expiry of the time specified in the first notification, the government issued withdrawal notification dated 16.10.1980. The appellant claimed that the government could not withdraw the notification because it had placed orders for import of PVC resin on the understanding that it was totally exempt from custom duty. Their Lordships of the Supreme Court reiterated the principles laid down in earlier decisions and held as under:-
“The suppression of revocation of an exemption notification in the “public interest”, is an exercise of the statutory power of the State under the law itself as is obvious from the language of Section 25 of the Act. Under the General Clauses Act an authority which has the power to issue a notification has the undoubted power to rescind or modify the notification in a like manner. From the very nature of power of exemption granted in the Government under Section 25 of the Act, it follows that the same is with a view to enabling the Government to regulate, control and promote the industries and industrial production in the country. Notification No. 66 of 1979 in our opinion, was not designed or issued to induce the appellants to import PVC resin. Admittedly, the said notification was not even intended as an incentive for import. The notification on the plain language of it was conceived and issued on the Central Government “being satisfied that it is necessary in the public interest so to do.” Strictly speaking, therefore, the notification cannot be said to have extended any “representation” much less a “promise” to a party getting the benefit of it to enable it to invoke the doctrine of promissory estoppel against the State. It would bear repetition that in order to invoke the doctrine of promissory estoppel, it is necessary that the promise which is sought to be enforced must be shown to be an unequivocal promise to the other party intended to create a legal relationship and that it was acted upon as such by the party to whom the same was made. A notification issued under Section 25 of the Act cannot be said to be holding out of any such relationship between the Government and the party drawing benefit flowing from the said notification. It is, therefore, futile to contend that even if the public interest so demanded and the Central Government was satisfied that the exemption did not require to be extended any further, it could still not withdraw the exemption.”
14. In Union of India v. International Trading Co., (2003) S.C.C. 437, the Supreme Court refused to apply the doctrines of promissory estoppel and legitimate expectation. The facts of that case were that the respondents were granted permits under the provisions of the Maritime Zones of India (Regulation of Fishing by Foreign Vessels) Act, 1981 and the Maritime Zones of India (Regulation of Fishing by Foreign Vessels) Rules, 1982 in the Exclusive Economic Zone of India in the prescribed form. The said permit authorized the respondent-applicants to obtain on lease and operate foreign deepsea fishing vessels in terms of the Act and the Rules. After expiry of the period of initial currency of the permits the same were not renewed by the appellants. A grievance was made by the respondents that no reason had been indicated and there was also no reference to any policy decision for not effecting the renewal. The writ petitions were filed by the respondents in Delhi High Court. With reference to an earlier order passed by the Division Bench in the case of Golden Ahar Limited v. Union of India and the counter- affidavit filed by the present appellant, the writ applications were dismissed by a Single Judge. In the said case, the Division Bench noticed that renewal of permission was not a mater of right, since there was change in Government policy. In larger public interest, the deep-sea fishing policy had to be reframed. A Review Committee was appointed which submitted its recommendations, and in that view of the matter there was no question of directing renewal of the permits. It was noticed by the Court that having regard to the policy decision adopted by the Government of India in the year 1996 pursuant to the report of the Review Committee the government was in the process of formulating a new deep-sea fishing policy. The respondents thereupon filed letters patent appeals. The High Court, inter alia, came to the conclusions that renewal of the permit is a valuable right: that it could be refused only on cogent and valid grounds; though plea was taken that renewal period was mentioned by mistake, the same was an afterthought, and the authorities concerned were required to consider the prayer for renewal of the permit in accordance with law. The Supreme Court reversed the order of the High Court and held:-
“Though there can be quarrel with the proposition that renewal of a permit carries with it a valuable right, but undisputedly, for outweighing reasons of public interest, renewal can be refused. If at the time when the matter is taken up for considering whether renewal is to be granted, there is a change in policy it cannot be said that the right is defeated by introduction of a policy. In such an event, the question of applying the doctrine of legitimate expectation or promissory estoppel loses significance. It has not been disputed that in fact the policy decision exists. Legitimacy of the policy decision has not been questioned by the respondents. Doctrines of promissory estoppel and legitimate expectation cannot come in the way of public interest, which has to prevail over private interest. The case at hand shows that a conscious policy decision had been taken and there was no statutory compulsion to act to the contrary. In that context, it cannot be said that the respondents have acquired any right for renewal. The High Court was not justified in observing that the policy decision was contrary to the statute and for that reason, direction for consideration of the application for renewal was necessary. Had the High Court not recorded any finding on the merits of respective stands, direction for consideration in accordance with law would have been proper and there would not have been any difficulty in accepting the plea of the counsel for the respondents. But having practically foreclosed any consideration by the findings recorded, consideration of the application would have been a mere formality and grant of renewal would have been the inevitable result, though it may be against the policy decision. That renders the High Court judgment indefensible.”
Their Lordships of the Supreme Court also rejected the plea of discrimination by making the following observations:-
“Even if it is accepted that there was any improper permission, that may render such permissions vulnerable so far as the thirty-two vessels are concerned, but it cannot come to the aid of the respondents. Two wrongs do not make a right. A party cannot claim that since something wrong has been done in another case; direction should be given for doing another wrong. It would not be setting a wrong right, but would be perpetuating another wrong. In such matters there is no discrimination involved. The concept of equal treatment on the logic of Article 14 of the Constitution cannot be pressed into service in such cases. What the concept of equal treatment presupposes is existence of similar legal foothold. It does not countenance repetition of a wrong action to bring both wrongs on a par. Even if hypothetically it is accepted that a wrong has been committed in some other cases by introducing a concept of negative equality the respondents cannot strengthen their case. They have to establish strength of their case on some other basis and not by claiming negative equality.”
15. The judgment of the Division Bench in M/s. Nestle India Ltd. (supra), which has been approved by the Supreme Court, turned on its own facts. A careful reading of that judgment shows that after noticing various steps taken by the State Government to abolish the purchase tax including the statement made by the Chief Minister at a public function, budget speech made by the Finance Minister and the decision taken by the Council of Ministers, the High Court came to the conclusion that the government was estopped from charging the purchase tax on the milk. While dismissing Civil Appeal No. 5826 of 1998 – State of Punjab v. M/s. Nestle India Ltd. and Ors., on 5.5.2004 along with other connected appeals, their Lordships of the Supreme Court observed:-
“The representation was made by the highest authorities including the Finance Minister in his Budget Speech after considering the financial implications of the grant of the exemption to milk. It was found that the overall benefit to the State’s economy and the public would be greater if the exemption were allowed. The respondents have passed on the benefit of that exception by providing various facilities and concession for the upliftment of the milk producers. This has not been denied. It would in the circumstances, be inequitable to allow the State Government now to resile from its decision to exempt milk and demand the purchase tax with retrospective effect from 1st April, 1996 so that the respondents cannot in any event re-adjust the expenditure already made.”
16. In view of the above discussion, we hold that the petitioner has failed to make out a case for quashing Annexures P7 and P8 or for issuance of a mandamus to the respondents to allow it to lift free stock of bajra at the cut-off rate of Rs. 330/- per quintal.
In the result, the writ petition is dismissed.