I B ENTERPRISE Vs. CESC LTD

JUDGEMENT

(1.) THE three petitioners in this writ petition dated June 26th, 2007 are seeking writs in the nature of certiorar, prohibition and mandamus directing and commanding CESC Ltd. (the first respondent)not to award the contract for which notice inviting expression of interest was issued on february 27th, 2007 to any third party and to consider their bettered offer.

(2.) COUNSEL for CESC has raised the question of maintainability of the writ petition. His submissions on the preliminary issue are these, CESC is just a company incorporated under the Companies Act, 1956. It is a private person. The tender process was initiated in connection with its commercial activities, which had nothing to do with any public duty or function. Since it is not a State within the meaning of Art. 12 of the Constitution of India, alleging violation of Art. 14 no writ petition can be moved against it. To show that CESC is not a State within the meaning of Art. 12, he has relied on raghuraj Singh and Co. v. CESC Ltd. and Ors. . 1998 (1) CHN 325 and Mithai Lal Passi v. CESC Ltd. and Ors. , 2003 (3) CHN 357. Counsel for the third respondent (Price Water house Coopers Pvt. Ltd.) cited to me Federal Bank Ltd. v. Sagar Thomas and Ors. , (2003) 10 SCC 733 : AIR 2003 SC 4325. Counsel for the fourth respondent, M/s. Rajendra Ispat Pvt. Ltd. , the successful bidder has adopted submissions made by counsel for CESC. He has further added that the sale of plant and machinery of the generating station concerned had no connection with any public interest, or public duty, or public function CESC was supposed to discharge.

(3.) IN response counsel for the petitioners has said these. CESC initiated the sale process after obtaining permission from the west Bengal Electricity Regulatory Commission. As will appear from the provisions of the Electricity Act, 2003, Ss. 61-64, and the provisions of the West Bengal Electricity regulatory Commission (Terms and Conditions of Tariff) Regulations, 2007, the sale proceeds receive by CESC will be directly relevant at the time of determination of tariff by the commission. If the plant and machinery are sold at a low price, as CESC did in the present case ignoring quite a high price offered by the petitioners, ultimately the consumers would be seriously affected. Hence it is apparent that the sale in question involved an element of public interest, and that CESC was selling the plant and machinery actually in the discharge of its public duty and public function; and therefore, with respect to the transaction in question it was required to act fairly and reasonably. Because of these things, even if CESC is a private body or person, it is amenable to writ jurisdiction, and law regarding this was clearly declared in Andi Mukta Sadguru etc. v. V. R. Rudani and Ors. , (1989) 2 SCC 69 : AIR 1989 SC 1607.