ORDER
Motilal B. Naik, J.
1. The question that falls for consideration in this writ petition is whether the 1st respondent viz., the Director of Mines and Geology, Government of Andhra Pradesh, Hyderabad, has power under the A.P. Minor Mineral Concession Rules, 1966 to extend the time beyond the period stipulated in the confirmation order as per sub-rule (2) of Rule 9-G. In order to appreciate this proposition, it is necessary to state few facts leading to the filing of this writ petition.
2. The petitioner is a Vaddera Labour Contract Co-operative Society, Aler, Nalgonda District, consisting majority of its members from weaker sections. It is stated that this society is registered under the provisions of the A.P. Cooperative Societies Act, 1964. It is also stated that sand quarries throughout the State of Andhra Pradesh are put to auction and the successful bidder is given the leasehold rights to the area earmarked. Prior to the issuance of G.O.Ms. No. 3, Industries & Commerce (M-IV) Department, dt. 3-1-1991, certain areas covered by sand were leased out by the Government on the basis of applications filed by the interested persons including the societies. Pursuant to the advent of the said G.O.Ms. No. 3, all sand quarries are to be put to auction and the successful bidder is entitled for getting lease.
3. Rule 9-B of the A.P. Minor Mineral Concession Rules, 1966 (hereinafter referred to as ‘the Rules’) is the relevant rule which governs the provisions relating to the granting of quarry leases of the areas covered by sand within the State of Andhra Pradesh, Rule 9-C governs the provisions relating to issuance of notice of auction and Rule 9-G relates to the provisions of deposit of sale amount and execution of lease-deeds in favour of the successful bidders.
4. The grievance of the petitioner-society is that in respect of sand quarries of Aler Mandal, Nalgonda district, auctions were held on 29-7-1991. The petitioner-society has also participated in the said auction, but was unsuccessful. It is stated that the 4th respondent was the successful bidder and the bid amount was to the tune of Rs. 26,00,000/-. As per the requirement of Rule 9-G(1), the successful bidder has to deposit 25% of the bid amount and cess thereon in the Government Treasury on the immediate next working day. Thereafter, the confirmation letter would be issued to the successful bidder. As per sub-rule (2) of Rule 9-G, the successful bidder, on receipt of order of confirmation, shall remit the remaining bid amount and cess thereon and also security deposit of Rs. 1,000/- in the Government Treasury on or before the date specified in the order of confirmation of sale and execute the lease in Form ‘G’ within a week from the date of such remittance. It is contended by the petitioner that in this case, auction was held on 29-7-1991; the confirmation order was issued by the 1st respondent vide proceedings No. 870/K5/91, dt. 2-8-1991, on the 4th respondent complying with the conditions of depositing the 25% of the bid amount within the time stipulated. In the confirmation order, 30 days’ time was allowed to the 4th respondent enabling him to deposit the 3/4ths balance bid amount along with Rs. 1,000/- towards security deposit from the date of receipt of the confirmation order. The confirmation proceedings dt. 2-8-1991 also indicate that no request for extension of time for payment of the balance amount and cess thereon would be entertained by the 1st respondent beyond 30 days stipulated, as the rules do not permit for such extension. It is under this background, the petitioner-society makes a specific allegation that as the confirmation order dt. 2-8-1991 admittedly has been received by the 4th respondent on 6-8-1991, the 30 days’ time stipulated for payment of the balance bid amount and cess thereon along with Rs. 1,000/- would expire on 5-9-1991. Strangely, the 1st respondent vide his proceedings No. 23554/K5/91, dt. 3-9-1991 has granted extension of time to the 4th respondent beyond the permissible period and, therefore, the action of the 1st respondent in granting such extension is in violation of rules and, thus sought indulgence of this Court for quashing the proceedings of the 1st respondent dt. 3-9-1991.
5. Sub-rule (3) of Rule 9-G of the Rules contemplates the procedure to be followed in the absence of the successful bidder failing to comply with the requirements as contemplated in sub-rules (1) and (2) of Rule 9-G. Sub-rule (3) of Rule 9-G reads as under:
“(3). If the successful bidder fails to pay the 25% of the knocked-down bid amount along with cesses thereon within 24 hours or the remaining 75% of the knocked down bid amount along with the cesses thereon within the time specified in the confirmation orders, the amounts so far paid by the successful bidder by way of deposits or other-wise shall be forfeited to the Government. The next highest bidder may be issued confirmation orders by the competent authority subject to the payment of entire bid amount along with the cesses thereon within seven days from the date of receipt of the order. If the second highest bidder also fails to pay the amount in time, the third highest bidder may be issued confirmation orders subject to the payment of the knocked down bid amount along with the cesses thereon within seven days from the date of the receipt of orders, provided the difference between the knocked down bid and the offered bids of the second and third highest bidders does not exceed 10%of the knocked down bid. If the 2nd and 3rd highest bidders fails to pay the amount after the confrimation is issued within the stipulated time, the deposit paid by them shall be forfeited to the Government.”
6. Thus according to sub-rule (3) if the successful bidder fails to deposit within the stipulated period, the second highest bidder’s case has to be considered. In the event the second highest bidder fails to deposit within the stipulated time, the third highest bidder’s case has to be considered.
7. Sri J. Siddaiah, learned counsel for the petitioner, contended that had the 1st respondent acted in accordance with the rules, the opportunity for this society entering into lease was very much on cards, as the petitioner-society had also participated in the auction and the bid amount offered by the society was upto Rs. 25,00,000/-. It is the case of the petitioner that admittedly the confirmation order was received by the 4th respondent on 6-8-1991 and the 30 days’ time for depositing the 1/4ths balance bid amount and cess thereon expired on 5-9-1991. By 6-9-1991, the 1st respondent should have invited the second highest bidder and after giving a week’s time as contemplated under the rules, if the second highest bidder fails to discharge his liability, the choice should fall on the third highest bidder. In that event, the petitioner-society would have got an opportunity to get the lease in their favour. As a result of the 1st respondent granting extension of time to the 4th respondent, the petitioner- society is deprived of the opportunity of getting the lease in its favour.
8. The 1st respondent has filed a detailed counter admitting the fact that the petitioner-society did raise the bid amount upto Rs. 25,00,000/-. The minimum bid amount fixed was Rs. 5,03,000/-. The 4th respondent being highest bidder, bid amount being Rs. 26,00,000/- the auction was knocked in his favour. It is also contended that the 1st respondent is vested with powers to grant extension as per Rule 9-G(2) of the Rules.
9. Under the background of the contentions raised by the petitioner-society, it has to be seen whether the 1st respondent is competent to extend time for payment of 3/4ths balance bid amount over and above the time stipulated in the confirmation order. It is also to be seen whether sub-rule (2) of Rule 9-G gives such a power to the 1st respondent for extension of time.
10. For appreciation of the contentions, it is necessary to extract the provisions of sub-rule (2) of Rule 9-G;
“2. The successful bidder, on receipt of order of confirmation shall remit the remaining bid amount and cesses thereon and also a security deposit of Rs. 1,000/- in a Government Treasury on or before the date specified in the order of confirmation of sale and execute the lease deed in Form G within a week from the date of such remittance.”
11. A reading of the provisions would only show the time within which the balance amount is to be deposited and the further course of action that has to be followed after the deposit, in accordance with Form ‘G’. In the absence of any specific rule or provision which enables the 1st respondent to extend time, in my view, such exercise of power is beyond his competence. Therefore, I hold that the 1st respondent has no power to grant extension of time for payment of 3/4ths balance bid amount and cess thereon beyond the period stipulated in the confirmation order.
12. Having held that the 1st respondent has no power to grant extension of time beyond the stipulated period, what could be the benefit that would enure to the petitioner-society under these circumstances? Admittedly, the lease period has reached to its fag end and at this point of time upsetting the contract is not for the benefit of either party.
13. Under these circumstances I allow the writ petition to the extent of holding that the 1st respondent has no power to extend time for payment of balance bid amount over and above the period stipulated in the confirmation order. No costs.