JUDGMENT
M.C. Agarwal, J.
1. In these two petitions the petitioners Jagat Singh and Gorakh Nath Upadhyaya respectively have challenged the award of a lease to collect tolls at Kaparwar Setu situate in district Deoria for the period 1-4-1996 to 31-3-1997 to Beni Madhav Pandey who is respondent No. 4 in both the petitions.
2. Both these petitions were listed for hearing on 3rd September, 1996. In writ petition No. 11053 of 1996 affidavits have been exchanged and the learned counsel for the patties were heard. In writ petition No. 10089 of 1996, however, the petitioner did not appear on that date. Since the controversy in both the writ petitions is the same this writ petition too is disposed of on merits by this common judgment.
3. The case as set up in writ petition No. 11053 of 1996 if that there is a bridge known as Kaparwar setu situate in district Deoria which is a post of the Gorakhpur Division. The toll tax is being collected in respect of use of the said bridge and Beni Madhav Pandey respondent No. 4 was given the contract for one year ending 31-3-1996 for a consideration of Rs. 15,12,000/-. It is claimed that the house of respondent No. 4 is situate close to the office of the Commissioner of Gorakhpur Division and the respondent No. 4 due to his influence has been granted right to collect toll tax in respect of the said bridge for the period 1-4-1996 to 31-3-1997″ without inviting bids through auction, as required under the Uttar Pradesh Toll Regulation, Leavy and Collection Rules, 1980. The consideration to be paid by the respondent No. 4 has been fixed at 15 per cent over and above the existing bid i.e. Rs. 15,12,000/-. The petitioner’s case shorn of unnecessary details is that the grant of right to collect toll without inviting offers in an auction is contrary to the Rules and this has been done to favour the respondent No. 4. The petitioner contends that he is ready to pay 40 per cent more than Rs. 15,12,000/-.
4. The petitioner has annexed to the petition a copy of the Uttar Pradesh Tolls Regulation, Levy and Collection Rules, 1980 framed by the Governor of Uttar Pradesh under the Indian Tolls Act, 1851. Under these Rules the Commissioner of the Division acts as a nominee of the Governor. Rules 4 and 8 of the Rules that are relevant, stands as. under :-
“4. Procedure for grant of lease.-In accordance with the provisions of Section 2-C of the Act:
(i) The Governor or his nominee may invite auction bids from the persons desirous of taxing lease for the collection of the tolls levied on the bridge specified in the notification, issuer1 by the Government.
(ii) The Governor or his nominee shall scrutinize the auction bids and verify the status and other particulars submitted by the applicant and after examining the documents or papers submitted by the applicants shall prepare a list of the suitable candidates to whom the lease contract may be granted.
(iii) If it is considered necessary the Governor or his nominee may call any bidders, for negotiations.
(iv) The Governor or his nominee presently the Divisional Commissioner, will select any person out of the list of the bidders and may order that the said person/contractor shall be granted lease in respect of the right to collect tolls on the specified road bridge.
(v) The Governor, if it considers necessary, in public interest may put to public auction the lease of the right to collect tolls on any specified road bridge. Such public auction shall be held after giving prior notice in important news papers by the authorised officer by giving a minimum notice of one month in the first instance, If such occasion arises which makes the tenders auction to be re-invited re-done, a similar notice of one month for the public auction may be issued.
(vi) The Governor or his nominee presently the Divisional Commissioner shall have the power to accept or reject any bid/tender and his decision in that respect shall be final.
(vii) No lease/contract of the right to collect the tolls under the Act on any road bridge shall be made for period exceeding 5 (five) years at a time.
(viii) The Governor or his nominee shall require the lessee to furnish security equal to three months instalment of auction money (including earnest money).
(ix) The lease/contract shall be executed on the standard form.
(x) The cost of execution and registration of the lease be borne by the lease.”
“8. Accepting of highest auction bid.-If a auction bid/negotiated offer is not the highest one the lower auction bid/negotiated offer can only be accepted after getting the prior approval of the State Government.”
5. In the counter affidavit filed on behalf of respondent No. 2, the Commissioner, Gorakhpur Division, it has been stated that the Commissioner after negotiation vide order dated 8-9-1995 awarded the theka of the bridge in question to respondent No. 4 by increasing the consideration by 15 per cent. The counter affidavit does not explain why in the face of the statutory Rules the method of private negotiation was adopted nor has the deponent, namely, Radhey Mohan Srivastava, Statistical Officer, Commissioner’s Office, Gorakhpur has annexed to the counter affidavit a copy of the alleged order dated 8-9-1995, nor of any other papers inviting persons for negotiations nor he has annexed to the counter affidavit any memorandum of the proceedings of the alleged negotiation. It has been stated in the counter affidavit that during the year 1994-95 also the contract was awarded to respondent No. 4 for a consideration of Rs. 15,00,000/-. It has been stated that the action of the Commissioner in granting the contract to the respondent No. 4 for the year 1996-97 is in accordance with the Government order dated 16-6-92 and Section 2 (c) of the Indian Tolls Act, 1851.
6. The respondent No. 4 has also filed a counter affidavit stating that the Commissioner called him and one Pandey brothers for negotiations and then awarded the contract to him on an increase of 15 percent over the earlier years considerations. It is stated by him in paragraph 5 of the counter affidavit that the contract for the year 1995-96 was settled through an auction. He explains that there is a law and order problem in the are a where the bridge is situate and it had come to the notice that bidders offer their bids but after acceptance they do not carry on the job and consequently the Commissioner called him and Pandey brothers for negotiations.
7. By an interim order dated 29th March, 1986, the operation of the order dated 11th September, 1995, copy of which is Annexure ‘1’ to the writ petition, by which the Commissioner intimated to the Executive Engineer, respondent No. 3 the award of the contract to respondent No. 4 for a consideration of Rs. 17,38,800/- (15 per cent over and above Rs. 15,12,000/-) was stayed by this Court and the respondent No. 3 was directed to manage the collection of tolls departmentally. The result thus is that the impugned contract could not be implemented.
8. We have heard the learned counsel for the petitioners and the learned counsel for the respondents.
9. Section 2-C to which reference has been made in the counter-affidavit filed on behalf of the Commissioner, respondent No. 2, merely states that the State Government may lease the right to collect the tolls upon any road or bridge to any person by public auction or by private negotiations on such terms or conditions as the State Government may deom fit. The State Government has framed the Rules referred to above in which the procedure for grant of lease under the provision of Section 2-C has been prescribed in Rule 4, the whole of which has been reproduced above. The said Rule does not permit grant of the lease rights to collect tolls by private negotiations meaning thereby that the State Government has not permitted private negotiations as a mode of award of contracts to collect tolls. Because of the aforesaid Rule the authority to settle the contract by private negotiations conferred by Section 2-C stands abrogated and the Commissioner cannot sustain the violation of Rule 4 by relying upon Section 2-C.
10. As stated above, the commissioner has not explained why statutory procedure of an auction was given a go by and whether the prior approval of the State Government was obtained for settling the rights by private negotiations and then getting the consideration settled with respondent No. 4 was also approved by the State Government. This was necessary in view of Rule 8 referred to above.
11. The Commissioner has placed reliance on an order of the Government doted 16th June, 1992. A copy of the alleged order has not been annexed to the counter affidavit. The reference seems to be a letter dared 1Cth June, 1992 addressed by the Secretary to Government to all Commissioners on the subject of contract for realisation of tolls in relation to pucca bridges, a copy of the said letter is Annexure ‘4’ to the writ petition. The said letter no where says that a contract can be awarded by private negotiations. What is says is that to bring uniformity in the auction of such rights in respect of all the bridges, the Government has decided that contracts for the realisation of tolls will be given only for one year. It also says that in future the auction be so arranged that the terms of each contract ends on 31st March though it may necessitiate grant of contract for a period of more than one year. The letter makes repeated reference to auctions and reliance thereon by the respondent No. 2 is mis-placed.
12. The Uttar Pradesh Tolls Regulation, Levy and Collection Rules, 1980 are statutory Rules and non compliance thereof, in a matter like this would vitiate the contract. Even otherwise, it is settled (aw that public property has to be sold for the best price and auction is the surest method of procuring the highest price. In this case the statutory Rules have been violated and the circumstance suggest that this was done to oblige the respondent No. 4 and no attempt whatsoever was made to procure the best price for the rights to be granted to collect tolls. The award of the contract to respondent No. 4 is, therefore, patently illegal and deserves to be quashed.
13. The allegations in the other writ petition ate identical and, therefore, we do not think it necessary to discuss the details thereof.
14. in the result, both the writ petitions are allowed and the award of the right to collect tolls for the period 1-4-1996 to 31-3-1997 in respect of the Kaparwar Setu situate over river Rapti in district Deoria of the State of Uttar Pradesh, to respondent No. 4 and consequent leas agreement said to have been executed on 7th March, 1996 and registered on 23rd March, 1996 are hereby quashed. The petitioner Jagat Singh in Writ Petition No. 11053 shall got his costs of this writ petition from respondents 1 and 4 which we assess at Rs. 5,000/- to be payable by the respondents 1 and 4 in sums of Rs. 2,500/-each. In writ petition No. 10089, the parties will bear their own costs.