G. Mehrotra, J.
1. These two Rules were issued on two separate applications under Article 226 of the Constitution. As common questions of law and facts have been raised in these two petitions, they are disposed of by a common judgment,
2. On 15-4-1958, a public auction was held for settlement of the Silonipam P.W.D. Ferry on the river Jiabhorali for a term of one year commencing from 1-5-1958. Previous to this auction sale, tenders were invited, but no settlement was mode, and in the auction sale which was held on 15-4-1958, the respondent No. 7, Pulin Chandra Chaudhury, offered a bid of Rs. 57,000/-, respondent No. 6, Biswanath Singh offered the highest bid of Rs. 87,020/-, and the petitioner in Rule No. 63 of 1958. Kailash Prosad Singh, offered a bid of Rs. 87,010/-.
The Deputy Commissioner, Darrang, at the close of the public auction, accepted the highest bid of Rs. 37,020/- offered by the respondent No. 6 and sent all the papers to the Chief Engineer, Assam, for approval. A sum of Rs. 21,755/- was deposited by the respondent No. 6, Biswanath Singh, in pursuance of the rules framed under the Northern India Ferries Act (Act 17 of 1878). The matter was considered by the Additional Chief Engineer who, by his order dated 26-4-58, did not accept the bid of respondent No. 6, Biswanath Singh, but directed the settlement of the right to collect toll with the respondent No. 7, Pulin Chandra Chaudhury, for a sum of Rs. 97,020/-.
This order was communicated to the parties, and it is against this order of the Additional Chief Engineer that the present petition was filed. The petition which has given rise to Rule No. 63 of 1958 has been filed by Kailash Prosad Singh, whose offer was Rs. 87,010/- and the other Rule No. 72 of 1958 has arisen out of an application filed by the opposite party No. 6, Biswanath Singh, whose was the highest offer. A number of points have been raised by the petitioners. Firstly, it is contended that under Section 8 of the Northern India Ferries Act, only the Commissioner had the power to give approval to the auction sale, and the power could not be delegated to the Chief. Engineer.
The next point urged is that the Additional Chief Engineer had no power to approve or disapprove the bid, and that the power could not be delegated by the Chief Engineer to the Additional Chief Engineer. Thirdly, it was urged that under the rules framed under the aforesaid Act, the Chief Engineer could reject the highest bid only after recording the reasons for the same. In the present case, no reasons have been recorded by the Additional Chief, Engineer.
It was also contended by the petitioner that under Rule 19(b) of the rules framed under the Northern India Ferries Act, the Chief Engineer could only direct that the settlement should be made with some other bidder at the price offered at the actual auction sale by him, but he could not make any direct settlement with him on a price different from what he had offered at the auction sale. Section 8 of the Northern India Ferries Act provides as follows :
'The tolls of any public ferry may, from time to time be let by public auction for a term not exceeding five years, with the approval of the Commissioner, or by public, auction, or otherwise than by public auction, for any terms with the previous sanction of the State Government.'
In the present case, settlement was made for a term not exceeding five years. Therefore, under the provisions of Section 8 of the Act, approval to the settlement had to be given by the Commissioner. Under the provisions of Section 3(1) of the Assam Commissioner's (Transfer of Powers) Act (Assam Act 12 of 1947), by a notification dated 20-5-54, the powers exercised by the Commissioner under Section 8 of the Northern India Ferries Act were transferred to the Additional Chief Engineers. Section 3 of Assam Act 12 of 1947 is in the following terms :
'3 (1). Notwithstanding anything contained in the Assam Commissioners' Powers Distribution Act, 1939, the Provincial Govt., may, by notification in the Official Gazette, transfer any or all of the powers exercised in any matter whatsoever by the Commissioner immediately before the commencement of this Act, and any jurisdiction vested in the Commissioner as aforesaid, to such other authority or authorities as may be specified. (2) Every authority, to whom any power or jurisdiction is transferred under the provisions of Sub-section (1), shall be deemed to be enabled to exercise the same power or to be vested with the same jurisdiction, in respect of the particular matter, as was exercised by, or vested in, the Commissioner.'
In our opinion, Section 3 gives very wide powers to the Government to transfer, by notification, the powers exercised by the Commissioner immediately before the commencement of the Act (Assam Act 12 of 1947), to any other authority duly specified. It cannot be said that under the provisions of the Northern India Ferries Act, the powers exercised by the Commissioner could not be transferred to any other authority.
Section 12 of the Act (Act 17 of 1878) also clearly states that the power to frame rules could be exercised by the Commissioner or any other authority prescribed by the Government. Therefore, on a consideration of the scheme of the Act, it will appear that the power which was to be exercised by the Commissioner under Section 8, was not such that it could not be transferred by notification under the provisions of Section 3 of Assam Act 12 of 1947. It was not denied that the power was transferred to the Chief Engineer.
3. The next question, therefore, for consideration is: whether this power could be delegated to the Additional Chief Engineer. It is not really a case of delegation of power. The word 'Chief Engineer' has not been defined anywhere, and by notification, dated 20-5-54, the Governor of Assam was pleased to authorise the two Additional Chief Engineers and Ex-officio Secretaries, Public Works Department, until further orders, to exercise the powers of the Chief Engineer, as per paragraphs 42 to 47 and 50 of the Assam Public Works Department Code, in respect of works within their respective areas. Clause 50 of the said Code provides as follows :
'He (Chief Engineer) is the officer who exercises the powers under Section 12 of the Northern India Ferries Act XVII of 1878, in respect of public ferries on provincial roads.'
The powers, therefore, exercised by the Chief Engineer under paragraph 50 of the Code, were exercisable, under the notification dated 20-5-54 by the Additional Chief Engineer. The power exercised by the Chief Engineer under the provisions of the Northern India Ferries Act is an administrative power and, in the absence of any clear definition of the word 'Chief Engineer', we see no reason why such power could not be, by notification, exercised by the Additional Chief Engineer. There is, therefore, no substance in the contention that the Additional Chief Engineer was not empowered to exercise the powers exercisable by the Chief Engineer under Rule 19(b) of the rules framed under Section 12 of the Northern India Ferries Act. Rule 19(a) of the rules provides as follows :
'In accepting the first instalment of bid money from the highest bidder or any other bidder whose bid is accepted by the officer conducting the sale, the bidder shall be informed in writing in the form shown in Appendix G by the officer conducting the sale that the sale is subject to the approval of the Chief Engineer, Assam.'
Clause (b) of Rule 19 then provides as follows :
'In approving of the sale, the Chief Engineer shall consider, among others, whether the officer conducting the sale has taken into account and considered all the factors mentioned in Rule 19 above The Chief Engineer may, for reasons recorded in writing, disapprove of the bid accepted by the officer conducting the sale and direct him to settle it with any other bidder. The direction of the Chief Engineer and his decision in this respect will be final and binding on all concerned and the officer conducting the sale shall be required to act accordingly.'
The above provisions clearly give power to the Chief Engineer or, in this case, the Additional Chief Engineer, not to accept the highest bid and to direct settlement with any other bidder. There is nothing in this rule which makes it obligatory for the Chief Engineer to accept only the price offered by a bidder at the auction sale, and not to accept any higher price even if offered by him. It is, however, clear from a perusal of this rule that the Chief Engineer cannot reject the highest bid unless he records his reasons in writing for so doing.
The obvious reason behind this rule is that the officer conducting the sale has to take into account certain specific matters, and the Chief Engineer, when giving his approval or disapproval to the sale, has also to apply his mind to those very considerations. If he intends to reject the highest bid, he must place his reasons for so doing on the record. It is not a discretion to be exercised arbitrarily. It would be against public policy to allow any such arbitrary discretion to the Chief Engineer. If the reasons are recorded by the Chief Engineer, they may be examined by this Court under Article 226 of the Constitution.
In the present case, it is conceded that there are no reasons recorded in writing by the Additional Chief Engineer and the only writing is a telegram which was sent by the Additional Chief Engineer to the Executive Engineer, Tezpur, Division. That, in our opinion, is not a compliance with the provisions of Rule 19(b) and cannot be said to be recording reasons for disapproval of the bid accepted by the officer conducting the sale. Apart from this rule, Section 8 of Act 17 of 1878 also points to the same conclusion. Paragraph three of Section 8 provides as follows :
'When the tolls are put up to public auction, the said officer or body, as the case may be, or the officer conducting the sale on his or its behalf, may, for reasons recorded in writing, refuse to accept the offer of the highest bidder, and may accept any other bid, or may withdraw the tolls from auction.'
4. In the result, therefore, we are of opinion that these petitions must be allowed and the order of the Additional Chief Engineer quashed on the ground that he did not comply with the provisions of Rule 19(b) of the rules framed under the Northern India Ferries Act. The Additional Chief Engineer will apply his mind to the whole question and, if he so thinks, give his reasons in writing for rejecting the highest bid or for accepting any other bid. In the circumstances of the case, we make no order as to costs.
Sarjoo Prosad, C.J.
5. I agree.