Decided on: 24 September, 2005
JUDGMENT-: Justice Sushil Harkauli and Justice Umeshwar Pandey
FACTS
In the present instance, Bharat Coking Coal (hereafter referred to as BCC) held an e-auction for the allocation of coal. BCC accepted the bid of P.R. Transport Agency (hence referred to as PRTA) for 4000 metric tonnes of coal from Dobari Colliery at Rs. 1,625/- per metric tonnes. The bid acceptance letter was e-mailed to PRTA's e-mail address on July 19th.
PRTA deposited Rs. 81.12 Lakhs towards the check written in favour of BCC in accordance with the 'Terms of Allocation'. The cheque was acknowledged by PRTA, but the coal was not delivered. BCC sent an e-mail cancelling the cheque deposited by PRTA due to technical challenges and unavoidable circumstances. However, the real reason was that someone else's bid was higher than PRTA's. Due to a software fault, the greater bid was not considered. In response to this letter, PRTA filed an application with the Hon'ble High Court of Allahabad.
ISSUES
Is this court's territorial jurisdiction sufficient to entertain and hear this writ petition?
Whether the tender agreement's ouster clause (No. 10.5) has the effect of excluding this Court's writ jurisdiction?
RATIO DECIDENDI
The court addressed the territorial jurisdiction issue, ruling that the place where acceptance of the tender was received via email constituted a part of the cause of action, granting territorial jurisdiction to the court in Uttar Pradesh (U.P.). It emphasized that an ouster clause in the tender agreement cannot exclude the High Court's jurisdiction under Article 226 of the Constitution.
Regarding the case's merits, the court found the respondent's cancellation of the auction and contract with the petitioner, despite bid acceptance, arbitrary and a breach of natural justice principles. The respondents, as a 'State' under Article 12, were bound by the concluded contract and the principle of promissory estoppel. The cancellation without a hearing for the petitioner violated natural justice.
Consequently, the court allowed the writ petition, nullified the cancellation communication, and directed the respondents to promptly hand over the coal covered by the petitioner's accepted bid.
JUDGMENT
The court accepted territorial jurisdiction based on the email receipt in Uttar Pradesh (U.P.). It dismissed objections to the petitioner's affidavit and clarified ouster clauses can't oust High Court jurisdiction under Article 226, if part of the cause of action arises within its jurisdiction.
Regarding the case, the court ruled in favor of the petitioner. It found cancellation of the auction and contract after bid acceptance arbitrary, violating natural justice and the concluded contract. The court directed the respondents to promptly hand over the coal covered by the accepted bid.
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