SANT KUMAR TRIPATHI Vs. STATE OF UTTAR PRADESH

JUDGEMENT

(1.) THESE two writ petitions are being disposed of by a common judgment as the question involved is common. The petitioner in both these petitions, was the highest tenderer whose tender was accepted with regard to certain Tendu leaf units sold by the Divisional Forest Officer through tenders. In accordance with a condition of the tender certain security amounts had to be deposited by the petitioner. As per the tender condition the Forest authorities demanded security amount in cash or in the form of National Savings Certificates or other approved securities and declined to accept Bank guarantee for the security amount which the petitioner wanted to offer as security. By these writ petitions the petitioner seeks quashing of the orders declining Bank guarantee by way of security and a direction in the. nature of Mandamus to the respondents for acceptance of Bank guarantee by way of security. The only controversy is whether condition 17 (ii) of the tender by which security was required in cash or in the form of National Saving Certificates or other approved Government securities can prevail in the face of Rule 9 (11) (ii) of the Tendu Patta (Viaiyaman) Niyamawali, 1972 (hereinafter referred to as the rules). THESE rules have been framed by the State Government in exercise of the power conferred by Section 18 of the Tendu Patta (Vyapar Viniyaman) Adhiniyam, 1972 which empowers the State Government to make rules for carrying out purposes of the Act. Section 10 provides for disposal or sale of Tendu leaves by the State Government 'in such manner as the Stale Government may direct'. The sale of Tendu leaves by the Government is, therefore, one of the purposes of the Act for which the rules may appro priately provide. The relevant Rules 9 (11) (ii) runs as follows :- "The security deposit shall be in the shape of revenue deposit in the name of Divisional Forest Officer concerned either in cash or Guarantee of scheduled banks, or post Office Cash Certificate, National Saving Certi ficate, 10 year Treasury Saving Deposit Certificate or 12 year National Saving Defence Certificate at surrender value, or in other form of Govern ment security recognised for the purpose of small Savings Scheme pledged to the Divisional Forest Officer, concerned." It is manifest that under this rule the petitioner at his option is entitled to give the security in the form of a Bank guarantee of a scheduled bank. In State of Uttar Pradesh and others v. Babu Ram Upadhya A.I.R. 1961 S.C. 751, it was laid down that rules made under a statute must be treated for all purposes of construc tion or obligation exactly as if they were in the Act and are to be of the same effect as if contained in the Act. and are to be judicially noticed for all purposes of construction or obligation. Therefore, once the rules have been framed they become a legislative mandate which binds even the State Government. On behalf of the respondents it was urged that the State Government has under Section 10 power to give directions regarding the manner in which the Tendu leaves are to be sold. There is also no dispute that the powers of the State Government can be delegated under Section 11 and it appears that in the present case the powers to give direction under Section 10 were delegated to the Conservator of Forests who prescribed the tender conditions. The submission of the respondents is that the tender condition requiring security otherwise than in the form of Bank guarantee is in these circumstances a valid direction under Section 10 of the Act and must operate notwithstanding Rule 9 (11) (ii). We cannot accept this contention. The State Government being bound by the rules cannot exercise its powers under Section 10 in a manner that contravenes the rules. Its powers to issue direction under Section 10 must be held to be circumscribed by the rules. Therefore, Rule 9 (11) (ii) must prevail over conditions 17 (ii) of the tender and to the extent to which the condition contravenes the rule the same must be held invalid and unenforceable. On the other hand the State Government and the forest authorities are bound to follow the rules regard ing security. The writ petitions are, therefore, allowed with costs. The orders refus ing to accept security in the form of Bank guarantee are quashed and the respondents are directed to accept Bank guarantee of a Scheduled Bank if furnished by the petitioner as provided by Rule 9 (11) (ii) of the Act.