Research › Search › Judgment

Rajasthan High Court · body

2014 DIGILAW 1199 (RAJ)

Singhal Trade Contractors Private Limited v. Jaipur Municipal Corporation

2014-05-22

AMITAVA ROY, VEERENDR SINGH SIRADHANA

body2014
JUDGMENT 1. - The judgment and order dated 19.03.2014, passed in S.B. Civil Writ Petition No.17336/2011, rejecting the appellant/writ-petitioner's challenge to the decision of the respondent-Corporation cancelling the auction of the plot bearing No.B-29 in Shri Sunder Singh Bhandari Scheme, Sodala, Jaipur, constitutes the subject matter of scrutiny in the present appeal. 2. We have heard Mr. R.N. Mathur, learned Senior Counsel assisted by Mr. Rahul Kamwar, Advocate for the appellant and Ms. Naina Saraf, the learned counsel for the respondent-Corporation. 3. The pleaded version of the appellant/writ-petitioner, in short, is that it responded to the notice issued by the respondent-Corporation for auction of various plots in different schemes under it in the month of October, 2011 and after making the security deposit, participated in the auction proceeding on 19.10.2011 for the residential plot No.B-29(corner) in Shri Sunder Singh Bhandari Scheme, Sodala, Jaipur, having an area of 246 sq. mtrs. His offer of Rs. 36,000/- per sq. mtr., being the highest from amongst the 25 bidders, he deposited an amount of Rs. 24 lacs, being 1/4th of the amount of total consideration payable. On such deposit, Receipt No.9002/5577, dated 19.10.2011 was issued by the respondent-Corporation in its favour. As the remaining amount was payable within a period of 30 days from the auction date, the appellant/writ-petitioner waited in bona-fide expectation, but was shocked and surprised to receive the letter dated 16.11.2011, issued by the Commissioner (Revenue), Jaipur Municipal Corporation, Jaipur, whereby the auction qua the aforementioned plot was cancelled on the ground that the appellant/writ-petitioner's offer had been rejected by the Mayor of the respondent-Corporation. Thereby, the appellant/writ-petitioner was required to present the original receipt of the amount of Rs. 25 lacs, so as to entitle it to obtain refund thereof. The appellant/writ-petitioner thereafter received another letter dated 18.11.2011, issued by the Chief Executive Officer of the respondent-Corporation, reiterating the above. Contending that the reserved price for the land had been fixed at Rs. 25,000/- per sq. mtr. and that its bid was the highest amongst the contending bidders, the appellant/writ-petitioner turned to this Court for redress asserting that there was no legally cognizable and acceptable ground justifying cancellation of the auction. 4. Contending that the reserved price for the land had been fixed at Rs. 25,000/- per sq. mtr. and that its bid was the highest amongst the contending bidders, the appellant/writ-petitioner turned to this Court for redress asserting that there was no legally cognizable and acceptable ground justifying cancellation of the auction. 4. In their reply, the respondents while pleading that an alternative remedy in law was available to the appellant/writ-petitioner, asserted that in the auction notice, it had been clearly mentioned that all rights with regard to auction proceeding would be reserved with the respondent-Corporation, to be invoked, if necessary, even after completion of the proceedings. The respondents contended that because of the existence of a 'Peepal' tree on the plot in question, it only fetched a price computed at Rs. 36,000/- per sq. mtr., though the adjacent plots being A-70, B-38(corner) and B-39(corner), auctioned on the very same day, had drawn offers of Rs. 45,000/-, Rs. 46,800/- and Rs. 46,100/- per sq. mtr. respectively. The respondents stated further that after the auction of the plot, B-29(corner), a complaint was laid before the Mayor, Municipal Corporation, Jaipur, emphasising that the said plot had been auctioned at a low price in-spite of protests by him. Eventually, the Mayor, on a consideration of the relevant aspects including the fact that the adjacent plots had fetched substantially higher price, cancelled the auction of plot, B-29(corner) and directed the officials of the Corporation to initiate a process for removal of the 'Peepal' tree, where after, the Commissioner(Revenue), Nagar Nigam, Jaipur, addressed a letter dated 09.12.2011 to the Commissioner(Garden) to that effect. Steps to secure the permission of the District Collector in this regard were also suggested. The respondents, thus, asserted that the action to cancel the auction of the plot was on genuine and persuasive reason i.e. augmentation of the Corporation's revenue as otherwise it(Corporation) would have suffered a loss of Rs. 25 lacs, had the appellant/writ-petitioner's offer @ Rs. 36,000/- per sq. mtr. been accepted. 5. The learned Single Judge, taking note of the recorded fact that in view of the existence of Peepal' tree on the plot involved, the Corporation could not realise in the auction the proper value thereof compared to that of the nearby plots, sustained the impugned action. 36,000/- per sq. mtr. been accepted. 5. The learned Single Judge, taking note of the recorded fact that in view of the existence of Peepal' tree on the plot involved, the Corporation could not realise in the auction the proper value thereof compared to that of the nearby plots, sustained the impugned action. It was held that the respondent-Corporation had the discretion to confirm the sale or not and that the reserved price being only the minimum, as fixed by the Corporation, confirmation of sale was not supposed to be based thereon. Having regard to the difference in the price recorded in the auction earned by the plots, the learned Single Judge held that confirmation of the sale could not be directed. It was observed as well that in absence of such confirmation, no right had been created in the appellant/writ-petitioner. It was, however, left at liberty to participate in the fresh auction, as and when conducted by the respondent-Corporation vis-a-vis the said plot. 6. Mr. Mathur has argued that the price of a plot or land essentially depends, amongst others, on its location and the attendant facilities constituting its potential and efficacy and there being no comparison of the plot, B-29 with others at the other sites, the variation in the price fetched in the auction, by no means, can be accepted to be justifiable reason to endorse the impugned action. While contending that the discretion of the respondent-Corporation could not be either absolute or unregulated, in absence of any fraud or material irregularity vitiating the auction process, mere inadequacy of the price did not warrant in law the action assailed, he insisted. As the auction was unassailably a public process, consideration of better price alone cannot validate the impugned decision, he urged. Mr. Mathur insisted that as the appellant/writ-petitioner's bid being the highest, had been accepted and he had deposited 1/4th of the total price payable, no decision to cancel the auction could have been taken without affording it an opportunity to resist such action. 7. The learned Senior Counsel argued as well that as the order of cancellation conveyed by the letters dated 16.11.2011 and 18.11.2011, did not contain any reason in support thereof, no cognizance of the averments to this effect, made in the reply of the respondent-Corporation, ought to be taken. 7. The learned Senior Counsel argued as well that as the order of cancellation conveyed by the letters dated 16.11.2011 and 18.11.2011, did not contain any reason in support thereof, no cognizance of the averments to this effect, made in the reply of the respondent-Corporation, ought to be taken. The learned Senior Counsel placed reliance on the decision of the Apex Court in Commissioner of Police, Bombay v. Gordhandas Bhanji, AIR(39) 1952 SC 16 , Shri Radhey Shyam v. Shyam Behari Singh, (1970) 2 SCC 405 and of the Punjab & Haryana High Court in Civil Writ Petition No.2543/1988- Surinder Singh v. The State of Haryana and Ors.(d/d 16.07.1993) 8. Per contra, Ms. Saraf has maintained that the ground on which the auction had been cancelled, is eminently relevant and valid. As the respondent-Corporation had reserved to itself the right to do so, the impugned action is unassailable. She urged that the auction sale in favour of the appellant/writ-petitioner had not been confirmed and that deposit of 25% of the price payable ipso facto did not signify the same. While reiterating that the adjacent plots had fetched much higher price than plot, B-29, on which stood the 'Peepal' tree, the learned counsel has urged that the reasons for cancellation of the auction, being pertinent and adequate, no interference therewith, in the exercise of this Court's power of judicial review, ought to be made. She reasoned as well that not only the impugned action did not suffer from any element of arbitrariness, in absence of any right in the appellant/writ-petitioner to enforce the auction sale in law, the impugnment is misconceived. 9. We have traversed the pleadings, examined the documents on record and have analyzed the arguments advanced. 10. That the reserved price for the plot involved, fixed by the respondent Corporation, was Rs. 25,000/- per sq. mtr. and that in the auction sale, the highest offer therefor made by the appellant/writ-petitioner was Rs. 36,000/- per sq. mtr., is a matter of record. The area of the plot is 246 sq. mtrs. It is also a recorded fact that the plot Nos. A-70, B-38(corner) and B-39(corner), auctioned on the very same date, had earned a price of Rs. 45,000/-, Rs. 46,800/- and Rs. 46,100/- per sq. mtr. respectively. It is not in dispute that all these plots are proximately located. The area of the plot is 246 sq. mtrs. It is also a recorded fact that the plot Nos. A-70, B-38(corner) and B-39(corner), auctioned on the very same date, had earned a price of Rs. 45,000/-, Rs. 46,800/- and Rs. 46,100/- per sq. mtr. respectively. It is not in dispute that all these plots are proximately located. However, judged by the difference in price fetched by these plots, eventually the amount to be earned by the respondent-Corporation for plot, B-29 of an area of 246 sq. mtrs., would be substantially less than that received from the sale of the other plots. The plea of the respondent-Corporation that if the plot, B-29 is sold @ Rs. 36,000/- per sq. mtr., it would suffer a loss of Rs. 25 lacs, thus cannot be readily discarded. From the point of view of a public institution, this consideration cannot be construed to be irrelevant or insignificant. That the existence of the 'Peepal' tree on the plot, B-29 had adversely affected its market value, has also not been disputed. 11. True it is that the respondent-Corporation ought to have examined this aspect of the matter, more closely when it had decided to put on auction several plots in the same locality and ought to have, if advised, taken necessary steps to remove the 'Peepal' tree to facilitate earning of a competitive market price therefor. Be that as it may, its omission to do so, per se, in our comprehension, would not inevitably invalidate its decision to cancel the auction on this ground, as done. 12. Hon'ble the Apex Court in Shri Radhey Shyam v. Shyam Behari Singh (supra), in essence, had held that mere inadequacy of price realised in an auction sale, would not justify annulment thereof in absence of any correlation with existing material irregularity or fraud therewith. 13. In Surinder Singh v. The State of Haryana and Ors. (supra), it was held that an auction sale can only be set aside if there was no sanction of the competent authority and the aggrieved party has to satisfy of having sustained substantial injury by reason of irregularity in the procedure followed for conducting the sale. 13. In Surinder Singh v. The State of Haryana and Ors. (supra), it was held that an auction sale can only be set aside if there was no sanction of the competent authority and the aggrieved party has to satisfy of having sustained substantial injury by reason of irregularity in the procedure followed for conducting the sale. It was held as well that a valuable right to acquire the property is vested in the person who purchases the same in an auction and if any order which is detrimental to him, is to be passed, he should be afforded an opportunity of hearing. 14. The word "irregularity", as defined in the Oxford English Dictionary is 'Lack of conformity to rule, law, or principle; deviation from what is usual or normal; abnormality, anomalousness. 15. In Black's Law Dictionary, the word has been defined inter alia as violation or non observance of established rules or procedures. 16. To reiterate, the respondent-Corporation ought to have been vigilant and prudent to ensure that the plot, B-29 was best prepared and was in a condition to fetch maximum price therefor, before putting it for auction sale. Though, the 'Peepal' tree stood on the plot adversely impacting on its market value, it did not choose to attend on this aspect while conducting the sale price, in which the intending members of the public did participate. This, notwithstanding, in our estimate, having regard to the difference in the price realised by the plots in auction, as aforementioned, the respondent-Corporation's concern for loss of revenue, if the appellant/writ-petitioners offer of Rs. 36,000/- per sq. mtr. was accepted, cannot be discounted to be frivolous and pretentious. As an institution of self Government, a loss of Rs. 25 lacs is assuredly avoidable. The failure of the respondent-Corporation to ensure that the plot, B-29 was groomed to fetch the best price, is an apparent departure from the usual or normal norms, adhereble to enhance the potential of any property offered for auction sale. The omission on the part of the respondent-Corporation in this regard, having regard to the supervening consideration of augmenting its revenue can, thus, construed to be an irregularity ensuing in patent inadequacy of the price realised in the auction. We are, thus, inclined to sustain the impugned decision. 17. The omission on the part of the respondent-Corporation in this regard, having regard to the supervening consideration of augmenting its revenue can, thus, construed to be an irregularity ensuing in patent inadequacy of the price realised in the auction. We are, thus, inclined to sustain the impugned decision. 17. Vis-a-vis the aspect of fairness in action, in view of the stand taken by the respondent-Corporation that the auction sale had not been confirmed, the plea that the impugned action is invalid being not precedented by an opportunity of hearing to the appellant/writ-petitioner, also does not commend for acceptance. The letters dated 16.11.2011 and 18.11.2011, addressed by the respondent-Corporation to the appellant/writ-petitioner, do record that its bid of Rs. 36,000/- per sq. mtr. had been rejected by the Mayor of the respondent-Corporation. Though these communications do not disclose any reason for the cancellation, it is evident from the auction proceedings pertaining to the other plots as well as the complaint dated 20.10.2011, laid before this authority that due to non-removal of the 'Peepal' tree, the respondent-Corporation would suffer a loss of Rs. 25 lacs, if the offer of the appellant/writ-petitioner was accepted. 18. We are also not inclined to sustain the challenge to the impugned action on the ground that it is bereft of reasons in support thereof. In Commissioner of Police, Bombay v. Gordhandas Bhanji , their Lordships were seized with the question as to whether an order of cancellation of the permission to build a cinema house granted to the respondent, had, in fact, been made by the jurisdictional Commissioner of Police on its own authority acting in the exercise of power conferred, or was merely an intimation to him of the order passed made by another authority, namely the Government. It was in that context that their Lordships remarked that public orders, publicly made, in exercise of a statutory authority, cannot be construed in the light of explanations subsequently given by the officer making the order of what he meant, or of what was in his mind or what he intended to do. It was further observed that public orders made by the public authorities are meant to have public effect and are intended to affect the actings and conduct of those to whom they are addressed and must be construed objectively with reference to the language used in the order itself. It was further observed that public orders made by the public authorities are meant to have public effect and are intended to affect the actings and conduct of those to whom they are addressed and must be construed objectively with reference to the language used in the order itself. It was held that the public authorities cannot play fast and loose with the powers vested in them, and persons to whose detriment orders are made are entitled to know with exactness and precision what they are expected to do or forbear from doing and exactly what authority is making the order. 19. Having regard to the textual facts and the context, in which the above exposition was made, we are of the view that this proposition is of no avail to the appellant/writ-petitioner. Both the letters dated 16.11.2011 and 18.11.2011, demonstrate, in unequivocal terms, that the Mayor of the respondent-Corporation had rejected the appellant/writ-petitioner's offer of Rs. 36,000/- per sq. mtr., an action within the realm of the powers available to her, coupled with the other materials traceable to the official records. 20. We are, thus, not persuaded to annul the impugned decision on this count. We find ourselves in complete agreement with the findings recorded in the impugned judgment and order.In the result, the appeal lacks in merit and is dismissed.Appeal Dismissed . *******