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HIGH COURT OF DELHI
W.P.(C) 2350/2023 & CM APPL. 8995/2023
AMIT SHARMA ..... Petitioner
Through: Mr. Raj Shekhar Rao, Senior Advocate with Mr. Samar Kachwaha, Advocate.
Through: Mr. Arun Birbal and Mr. Sanjay Singh, Advocate for DDA.
JUDGMENT
1. The present writ petition has been filed by the Petitioner seeking a direction to the Respondent, DDA to allot Plot No. D-37, Badgolla, Dwarka, New Delhi (‘the subject Plot’) since the Petitioner was the highest bidder in the e-auction held for the same and to direct the Respondent to accept the full and final amount of the Petitioner. Alternatively, it is prayed that the Respondent be directed to reconsider the cancellation of the Petitioner’s highest bid.
2. Mr. Raj Shekhar Rao, learned senior counsel appears on behalf of the Petitioner. Mr. Arun Birbal, learned standing counsel, appears for the Respondent, Delhi Development Authority (‘DDA’).
3. Learned senior counsel for the Petitioner states that the Petitioner was declared the highest bidder vis a vis the subject Plot. He states that the Petitioner received an email dated 20.07.2022 from Respondent, DDA acknowledging that the Petitioner’s bid was the highest. He states that however on 18.11.2022, without assigning any reason and in an arbitrary manner, the Respondent, DDA has rejected the Petitioner’s highest bid and returned the earnest amount of Rs. 11,01,943/- to the Petitioner herein. He states that the Petitioner has a bona fide need for a residential property in Delhi and therefore seeks this writ of mandamus.
4. In reply, learned standing counsel for the Respondent, DDA who appears on advance notice states that other plots in Dwarka region, whereby the subject Plot is located, were also placed for e-auction and the bids received for the said plots in Dwarka region are as under:
225.54 2,87,96,948/- 4,73,96,948/- 2,10,448.74 Accepted 3 Plot No. 121, Pkt-C-8, Sec- 17, Dwarka 315 4,02,19,200/- 4,67,69,200/- 1,48,473.65 Rejected 4 Plot No. D-37, Bagdolla, Dwarka
172.61 2,20,38,845/- 2,25,88,845/- 1,30,866.37 Rejected
4.1. He states that the bid price received for the other plots in the same neighbourhood was higher as compared to the subject Plot. He states, therefore, after comparison and evaluation of the bids, the competent authority was of the opinion that the Petitioner’s bid received for the subject Plot was not competitive, does not reflect the market value of the subject Plot and hence, the Petitioner’s bid was rejected. He relies upon the bid information enlisted at column no. 6 of the table to substantiate the aforesaid plea. He states that the price realised for the subject Plot was substantially lower than the bid price received for the plots at S. Nos. 1 and 2.
5. He relies upon Clause 1.[9] of the e-auction document, with special reference to chapter General Instructions to Bidders/ Prospective Bidders, regarding the right of DDA to accept or reject the proposal, which reads as under: “DDA reserves the right to accept or reject any or all of the proposals/e-bids without assigning any reason whatsoever and to take any measure as it may deem fit, including annulment of the bidding process, at any time prior to confirmation of bid, without liability or obligation for such acceptance, rejection or annulment.” (Emphasis supplied)
5.1. He states that the right to reject the bid was exercised by Respondent in accordance with Clauses 2.4.[1] and 2.4.[2] of the e-auction document, dealing with e-auction details for present auction, which reads as follows: “2.4.1. The accepting officer, subject to confirmation of the VC, DDA, normally accept the highest Bid for a plot, provided that it is above the reserve price and found to be competitive enough to reflect the market value of the plot auctioned for. 2.4.2. The confirmation of the highest Bid shall be in the sole discretion of the Vice Chairman, DDA who does not bind himself to confirm the highest bid and reserve to himself the right to reject all or any of the bid without assigning any reasons. Any Bid not fulfilling any of the prescribed conditions or incomplete in any respect shall be rejected.”
5.2. He states that the Respondent acted in public interest in rejecting the Petitioner’s bid, based on cogent reasons and the said decision was not arbitrary, in any manner. He states that the Petitioner’s bid was not accepted and therefore, no concluded contract came into existence between the parties.
5.3. He states that the earnest money has been admittedly refunded to the Petitioner on 18.11.2022 and therefore the present writ petition which is filed on 16.02.2023 is highly belated and is intended to take advantage of increase in the prices of the subject Plot.
5.4. He states that the time lapse in processing the refund between 15.07.2022 and 18.11.2022 was due to the time taken by the competent authority in evaluating the competitiveness of the bid received for the subject Plot.
6. In rejoinder, the learned senior counsel for the Petitioner states that the comparison between the subject Plot and the plots at S. Nos. 1 and 2 of the table is erroneous. He states that the subject Plot has physical disadvantages in as much as the frontage of the subject Plot is obstructed by an electric pole and a huge meter box. Further he states that the size of the subject Plot is smaller than the plots at S. Nos. 1 and 2. He states that the bid price submitted by the Petitioner is competitive and reflects the fair market price.
6.1. He relies upon the judgment of Supreme Court in Vice Chairman & Managing Director, City and Industrial Development Corporation of Maharashtra Ltd. and Another v. Shishir Realty Private Limited and Others, 2021 SCC OnLine SC 1141 and this Court in PKF Sridhar and Santhanam v. Airports Economic Regulatory Authority of India, 2022 SCC OnLine Del 122, to contend that the right reserved to Respondent under Clauses 2.4.[1] and 2.4.[2] to reject bids cannot be exercised arbitrarily merely because DDA has the power to do so.
7. This Court has heard the learned counsel for the parties and perused the record. In compliance with the order dated 23.02.2023, the Respondent has filed brief note dated 25.02.2023, placing its stand on record.
8. The facts relevant for deciding the present writ petition are as follows:
8.1. The Petitioner applied for the e-auction conducted by the Respondent, DDA, more specifically for the bid of the subject plot.
8.2. On a demand raised by the Respondent, DDA, the Petitioner paid Rs. 11,01,943/- as earnest money for participating in the aforesaid e-auction.
8.3. Thereafter, on 19.07.2022, the Petitioner was declared the highest bidder for the subject Plot by the Respondent, as the Petitioner had made the highest bid of Rs. 2,25,88,845.
8.4. The Petitioner was served with an e-mail dated 20.07.2022 whereby the Respondent informed that the Petitioner has made the highest bid for the subject Plot.
8.5. Subsequently, on 18.11.2022, i.e., after four months, the Respondent returned the earnest amount of Rs. 11,01,943/- to the Petitioner, which has been annexed as Annexure P[4] to the writ petition.
9. Firstly, this Court takes note of the submission of the Respondent DDA that there has been a considerable delay in filing the present writ petition. As noted above, the earnest amount was returned to the Petitioner herein on 18.11.2022, and, the present petition has been filed on 16.02.2023. There is no correspondence or grievance addressed by the Petitioner to Respondent, DDA regarding the subject matter arising in the present petition post 18.11.2022. Therefore, it is apparent that in the first instance the Petitioner herein accepted the said refund of earnest amount of Rs. 11,01,943/- without any demur or protest.
10. Secondly, this Court finds merit in the contention of Respondent, DDA that in the facts of the present case, there is no privity of contract between the Petitioner and the Respondent as a result of the submission of the highest bid.
10.1. As per the terms of the e-auction document, the Respondent, DDA after accepting the bid, issues a Letter Of Intent (‘LoI’) to the highest bidder for its acceptance by the bidder, i.e., the Petitioner. In the facts and circumstances of the present case, admittedly the Respondent, DDA has not issued any LoI to the Petitioner herein. Therefore, this Court is of the view that, in the absence of acceptance of the Petitioner’s bid by the Respondent, DDA, there is no privity of contract, which would entitle the Petitioner to seek allotment of the subject Plot in terms of prayer (a).
11. Thirdly, this Court is satisfied that the Respondent has offered a reasonable explanation for the decision taken by the competent authority in rejecting the Petitioner’s bid. A perusal of the table filed by the Respondent shows that in addition to the bid for the subject Plot, bid for plot at Sr. No. 3 was rejected on identical grounds.
12. This Court is of the view that the decision taken by the competent authority, rejecting the bid of the Petitioner was not arbitrary and the same was made based on the material available before it. The best price which the subject Plot can fetch is within the domain of Respondent DDA. Therefore, this Court cannot compel the Respondent, DDA to accept the Petitioner’s bid for the sole reason that he was the highest bidder in the e-auction.
13. In view of the aforesaid findings that there is no concluded contract between the parties, the reliance placed by the Petitioner upon the judgment in Shishir Reality Private Limited (supra) is not applicable to the facts of the present case. In the said matter, the statutory authority therein had sought to cancel the allotment and subsequent permissions, after the contract therein had become final between the parties; in the said case the lease deed was duly executed, the entire bid amount had been paid by the lessee therein and the lessee was in possession of the property.
14. The contention of the Petitioner that the subject Plot has physical hindrances in the form of electric pole and a huge meter box and cannot be compared with the commercial viability of the other plots at Sr. Nos. 1 and 2, are facts which are not justiciable and subject to judicial review of this Court. In this regard, it would be instructive to refer to the judgment of the Division Bench of this Court in VK Worldwide Holdings Ltd. v. Ministry of External Affairs, Government of India and Others, 2021 SCC OnLine Del 5065 wherein this Court held at paragraph 47 as under:
15. The said proposition of law also finds support in the judgment of PKF Sridhar (supra) relied upon by the Petitioner, wherein the Division Bench of this Court held as follows: “17. In response to our query, the learned counsel for the respondent has projected before us the lowest rates offered and accepted by the respondent in respect of several airports contemporaneously. From the same, it appears that the petitioner itself had quoted lower rates for a busier airport, such as Mumbai, in comparison to rates quoted for the Assignment-1, which relates to Sardar Vallabhbhai Patel International Airport at Ahmedabad.
18. Similarly, we find in the tabulation which has been projected before us, that the rates quoted for other airports are substantially lower.
19. Let the respondent place on record the said tabulation during the course of the day.
20. From the above, it appears to us that the decision taken by the respondent in cancelling the tendering process in question, wherein the petitioner emerged as the L-1 bidder cannot be said to be unreasonable or arbitrary. The respondent could not be expected to accept high rates, which are not commensurate with the rates prevailing in the industry. Since, the respondent itself has invited the other tenders, and it is an organisation dealing with the aspect of fixation of tariffs for grant of airport services, the respondent is aware of the rates prevalent in the industry. The decision taken by the respondent, therefore, appears to be an informed decision and founded upon germane considerations.
21. We have taken note of the fact that the rates received by the respondent in the subsequent tendering process or the same assignment have, in fact, turned out to be more competitive. This, in our view, validates the decision of the respondent to cancel the tender in question and to re-invite the same.
22. So far as the petitioner's grievance that the respondent could not have held post-tender negotiations is concerned, we are of the view that if the petitioner had any grievance in that respect, the petitioner should have challenged the said move/conduct before participating in the negotiations. Moreover, it appears that the negotiations were held to make an endeavour to conclude the contract at reasonable rates. In any event, the said conduct of the respondent has no bearing on the decision taken by the respondent to cancel the tender.
23. For the aforesaid reasons, we do not find any merit in this petition and dismiss the same, leaving the parties to bear their respective costs.”
16. In view of aforesaid facts and circumstances, this Court is of the view that the present writ petition is devoid of any merit and the Petitioner is not entitled to the reliefs as sought in the writ petition. Accordingly, the present petition and pending applications, if any, are dismissed. No order as to costs.
MANMEET PRITAM SINGH ARORA, J MARCH 14, 2023