ORDER : Subba Reddy Satti, J. Challenging the endorsement vide R.O.C.No.1961/2019 /A1 dated 02.02.2024 issued by respondent No.1 and resolution No.1190 dated 31.01.2024 of respondent No.2, cancelling the highest bid, the above writ petition is filed. 2. The case of the petitioner is that pursuant to the tender notice issued vide ROC No.1961/2019-A1 dated 18.01.2024, conducting auction for collection of daily fee/rent for vegetable market and vehicle parking for the year, 2024-25, the auction was conducted on 27.01.2024. The petitioner emerged as the highest bidder for an amount of Rs. 1,33,00,000/-. However, the bid was cancelled without assigning any reasons. 3. In the Counter affidavit filed by the Commissioner of respondent No.1, it was contended that basing on the representation, dated 27.01.2024, made by one C.S. Nizamuddin, that the auction was not conducted properly and the rumour spread out that the bidders, who participated in the auction, conspired and committed syndicate, due to which the auction was stopped at the lowest amount, majority members of Proddatur Municipal Council suggested for cancellation of auction dated 27.01.2024 and hence, respondent No.2 passed resolution No.1190. Respondent No.2, to improve the revenue to the Municipality cancelled the highest bid and resolved to conduct fresh auction by fixing the starting bid amount at Rs. 1,33,00,000/-. As per point No.7 of the Gazette No.11/2024, Council/Contract Committee can reject the highest bid without revealing any reason. Eventually, prayed to dismiss the writ petition. 4. Heard Sri. K.S. Murthy, learned Senior Counsel assisted by Sri. T. Diwakar Reddy, learned counsel for the petitioner, Sri. N. Ranga Reddy, learned standing counsel for respondent No.1 and learned counsel for respondent No.2. 5. Learned Senior Counsel appearing on behalf of the petitioner would contend that pursuant to the resolution, dated 31.01.2024, the Commissioner passed the endorsement vide R.O.C.No.1961/2019/A1 dated 02.02.2024, cancelling the highest bid offered by the petitioner. He would contend that the resolution is passed by the Council on extraneous reasons and the same is arbitrary. He would also point out that immediately after conducting the auction, one of the participants addressed letter to the Vice Chairman of Proddatur Municipality stating that auction was not conducted as per the Rules and the Vice Chairman, in turn, addressed letter to the Commissioner, on the same day, for initiating necessary action, for which, learned Commissioner replied that the auction was conducted by following procedure. Learned Senior Counsel would contend that resolution No.1190 passed by the Council does not contain reasons for cancellation. 6. Learned standing counsel, per contra, would contend that as per point No.(7) of the gazette notification, the Council has got power to cancel the auction, without assigning any reason. To get more income to the Proddatur Municipality, the Council cancelled the auction and resolved to conduct fresh auction by fixing the minimum price at Rs. 1,33,00,000/-. 7. Whether the endorsement of the Commissioner vide R.O.C.No.1961/2019/A1 dated 02.02.2024 and resolution No.1190 dated 31.01.2024 are vitiated by arbitrariness and extraneous considerations? 8. A perusal of the record discloses that Gazette No.11/2024, dated 10.01.2024 was published, as per resolution No.1139 dated 30.12.2023, to conduct open auction for collection of daily fee of vegetable market and vehicle parking at vegetable market, Meat and Fish market, in the Municipal ground belonging to the Municipality, for the year 2024-25, commencing from 01.04.2024 to 31.03.2025. Open auction was conducted on 27.01.2024 and petitioner emerged as the highest bidder for Rs. 1,33,00,000/-. Subsequently, auction proceedings were placed before the council for ratification. However, the Council vide resolution No.1190 dated 31.01.2024 cancelled the auction in respect of collection of daily fee of vegetable market and vehicle parking bid and resolved to re-conduct the auction with starting price as Rs. 1,33,00,000/-. The highest bid in respect of Meat and Fish Markets, was approved. 9. As can be seen from the schedule of the gazette notification, no minimum price is fixed. For the previous year, the highest bid was knocked at Rs. 1,28,00,000/- and for the present year, the highest bid offered by the petitioner is Rs. 1,33,00,000/-. 10. This Court by order, dated 15.02.2024 directed learned standing counsel to produce original record and in pursuance of said order original record is placed before this Court. 11. A perusal of the record shows that immediately after conducting the auction, one of the participants by name C.S. Nizamuddin made representation dated 27.01.2024 to the Vice Chairman, Proddatur Municipality stating that person conducting auction has not conducted the same as per the procedure and in fact he colluded with one of the persons in the auction. The Vice Chairman, in turn, addressed letter to the Commissioner, on the same day to cancel the auction and to initiate necessary steps. The Vice Chairman, in turn, addressed letter to the Commissioner, on the same day to cancel the auction and to initiate necessary steps. To the letter addressed by Vice Chairman, Proddatur Municipality, Commissioner, Proddatur Municipality, vide endorsement 77/2024/A1 dated 27.01.2024 replied that the auction was conducted under the chairmanship of the Commissioner, Revenue Official Incharge and Revenue Inspector, by following the procedure and as per the Rules. The said endorsement would further disclose that none of the participants objected. Later the auction proceedings were placed before the Council for ratification. 12. The record further reveals that the Chairman of Proddatur Municipality, signed the resolution cancelling the auction in respect of fee collection of vegetable market and vehicle parking for vegetable market and directed the authorities to fix the price at Rs. 1,33,00,000/-. However, no reasons were assigned by the Council to cancel the auction conducted on 27.01.2024. 13. This Court is conscious of the fact that while adjudicating the validity of the endorsement, impugned in the writ petition; it will not act as appellate authority. The court has to see whether the authority followed the procedure and whether any proper reasons were assigned? 14. The counter affidavit is filed by another Commissioner i.e. respondent No.1, wherein it was stated in para No.10 as follows: "It is further submitted that after completion of auction dated 27.01.2024 one roomer spread out entire Proddatur town i.e. the bidders are who participated in the auction held on 27.01.2024 conducted by Proddatur Municipal authorities conspired and committed syndicate and stand as ring and not properly participated in the open auction with the help of other political leaders caused to stopped the auction in lowest amount which is stands in the name of the highest bidder." 15. The reason assigned at para No.10 of the counter affidavit is nobody's case. No doubt as per point No.7 of the Gazette, the authority got power to cancel the auction. However, the authority should have assigned reason for such cancellation. 16. The reason assigned at para No.10 of the counter affidavit is nobody's case. No doubt as per point No.7 of the Gazette, the authority got power to cancel the auction. However, the authority should have assigned reason for such cancellation. 16. In Assistant Commissioner, Commercial Tax Department, Works Contract and Leasing, Kota v. Shukla and Brothers (2010) 4 SCC 785 , the Hon'ble Apex Court held as under: "The principle of natural justice has twin ingredients; firstly the person who is likely to be adversely affected by the action of the authorities should be given notice to show cause thereof and granted an opportunity of hearing and secondly, the orders so passed by the authorities should give reason for arriving at any conclusion showing proper application of mind. Violation of either of them could in the given facts and circumstances of the case, vitiate the order itself. Such rule being applicable to the administrative authorities certainly requires that the judgment of the court should meet with this requirement with higher degree of satisfaction. The order of an administrative authority may not provide reasons like a judgment but the order must be supported by the reasons of rationality. The distinction between passing of an order by an administrative or quasi-judicial authority has practically extinguished and both are required to pass reasoned orders." 17. In Siemens Engg. and Mfg. Co. of India Ltd. v. Union of India (1976) 2 SCC 981 , the Hon'ble Apex Court held as under: "6. .... If courts of law are to be replaced by administrative authorities and tribunals, as indeed, in some kinds of cases, with the proliferation of administrative law, they may have to be so replaced, it is essential that administrative authorities and tribunals should accord fair and proper hearing to the persons sought to be affected by their orders and give sufficiently clear and explicit reasons in support of the orders made by them. Then alone administrative authorities and tribunals exercising quasi-judicial function will be able to justify their existence and carry credibility with the people by inspiring confidence in the adjudicatory process. Then alone administrative authorities and tribunals exercising quasi-judicial function will be able to justify their existence and carry credibility with the people by inspiring confidence in the adjudicatory process. The rule requiring reasons to be given in support of an order is, like the principle of audi alteram partem, a basic principle of natural justice which must inform every quasi-judigical process and this rule must be observed in its proper spirit and mere pretence of compliance with it would not satisfy the requirement of law." 18. In the case at hand, the Municipal Council without assigning any reason cancelled the petitioner's bid. Therefore, in the opinion of this Court, Resolution 1190 passed by the Council and the consequential endorsement of Commissioner vide ROC 1961/2019/A1 dated 02.02.2024, suffer from lack of reasons and hence, they are liable to be set aside. 19. Accordingly, this writ petition is allowed at the stage of admission, setting aside R.O.C.No.1961/2019/A1 dated 02.02.2024 and resolution No.1190 dated 31.01.2024. The matter is remitted to the authority for passing fresh orders. No costs. As a sequel, pending miscellaneous petitions, if any, shall stand dismissed.