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TMI Blog1987 (11) TMI 372X X X X Extracts X X X X X X X X Extracts X X X X ..... out of 100 acres of the estate was in possession of the workmen as per settlement arrived at between the Labour Commissioner and the District Collector. The workmen used to collect the income therefrom towards their wages. This arrangement continued for about thirteen years. On January 7, 1982, the Corporation got possession of the entire estate. The Corporation wanted to recover its amount. It was not interested in the property. It therefore, invited tenders for the sale of the estate. On March 19, 1982, a tender notification was published in dailies like Malayala Manorama, Mathrubhoomi and Deepika newspapers. In response to the notification, the daughter-in-law of the appellant was the only tenderer. She offered Rs.5,10,505. The Corporation accepted the tender. It was subsequently found that the daughter-in-law was no better than the appellant. She also could not pay any amount. On January 18, 1983, the Corporation again invited tenders for the sale of the property. The notification was published in the said newspapers as it was done earlier. This time, the Corporation received these tenders: (i) T.M. Hassan Rawther (Appellant before us) for Rs. six lakhs; (ii) P.M. Jacob for Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... blic auction to the petitioner, who purchased it for Rs. six lakhs but failed to pay the sale amount in spite of the fact that this court and afterwards the corporation had shown great indulgence towards the petitioner. This is not at all a fit case for interference under Art. 226 of the Constitution." Being aggrieved by the judgment of the High Court, the appellant has preferred the present appeal. On May 18, 1985, this Court while entertaining the appeal issued notice limited to the question whether the sale of the property should be made by general auction. This Court further directed that in any event, the appellant will not be allowed to participate in the auction. Very interesting turn of events. The appellant who miserably failed to secure the property for himself is now interested in securing the best price for the Corporation. He says that this is a public interest litigation. His case is that the Corporation in all fairness must dispose of the property by public auction. It could not have bargained with P.M. Jacob and sold the property to M/s. Gumraj Plantations. Before the High Court, the appellant attacked the sale also on the ground that it was actuated by extraneou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or entering into contracts or otherwise, and it cannot act arbitrarily and enter into relationship with any person it likes at its sweetwill, but its action must be in conformity with some principle which meets the test of reason and relevance. This rule also flows directly from the doctrine of equality embodied in Art 14. It is now well settled as a result of the decisions of this Court in E.P. Rayappa v. State of Tamil Nadu and Maneka Gandhi v. Union of India that Article 14 strikes at arbitrariness in State action and ensures fairness and equality of treatment. It requires that State action must not be arbitrary but must be based on some rational and relevant principle which is non-discriminatory: it must not be guided by any extraneous or irrelevant considerations, because that would be denial of equality. The principle of reasonableness and rationality which is legally as well as philosophically an essential element of equality or non-arbitrariness is protected by Art. 14 and it must characterise every State action, whether it be under authority of law or in exercise of executive power without making of law. The State cannot, therefore, act arbitrarily in entering into relati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cessarily bound to accept the highest or any other offer, but the public at least gets the satisfaction that the Government has put all its cards on the table. In the instant case, the officers who were concerned with the sale have inevitably, though unjustifiably attracted the criticism that during the course of negotiations the original bid was reduced without a justifying cause. We had willy-nilly to spend quite some valuable time in satisfying ourselves that the reduction in the price was a necessary and fair consequence of the reduction in the quantity of the goods later offered for sale on March 31, 1980. One cannot exclude the possibility that a better price might have been realised in a fresh public auction but such possibilities cannot vitiate the sale or justify the allegations of malafides." In Shri Sachidanand Pandey v. State of West Bengal, AIR 1987 SC 1109 at 1133, O. Chinnappa Reddy, J. after considering almost all the decisions of this Court on the subject summarised the propositions in the following terms: "On a consideration of the relevant cases cited at the bar the following propositions may be taken as well established: State owned or public owned property is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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