Hemant Gupta, J.@mdashThe challenge in the present petition is to the communication dated 13.02.1987, Annexure P-3, whereby the Petitioner was informed that the property, of which the Petitioner was the highest bidder, shall be re-auctioned on 11.03.1987.
2. The grievance of the Petitioner is that since the Petitioner was the highest bidder in an auction conducted on 20.03.1984 and having deposited the earnest money, the decision to put the property to sale is arbitrary and illegal and that the Petitioner has vested right for confirmation of sale in his favour. The Petitioner challenged the said communication before the Settlement Commissioner. The learned Settlement Commissioner passed an order dated 09.03.1987, Annexure P-4. It was found that the petition is not maintainable on the basis of the notice issued to the Petitioner. Still aggrieved, the Petitioner has filed the present petition, wherein it stated that the land bearing Khasra No. 62//1 to 5, measuring 40 Kanals 13 Marias was put to auction by the Tehsildar (Sales) on 20.03.1984. The Petitioner emerged as the highest bidder having given a bid of Rs. 18,000/-. A sum of Rs. 2250/- was deposited as earnest money on the same date with the Tehsildar (Sales). The remaining amount was to be deposited after confirmation of sale was communicated to the Petitioner in accordance with the terms and conditions of the auction. The Petitioner alleges that he is in cultivating possession of the said property in pursuance of the auction held. One Laxmi Chand filed a miscellaneous petition challenging the auction in favour of the Petitioner. The confirmation of auction was initially stayed, but the said miscellaneous petition was dismissed as withdrawn and another petition was filed under Rule 11 of the Rules for Sale of Surplus Rural Properties. Such petition was dismissed on 14.08.1986. Thereafter, the Petitioner was informed of the order dated 13.02.1987.
3. In the original written statement, an averment was made that the Additional Settlement Officer declined confirmation of auction in favour of the Petitioner on 08.02.1987 and that vide order dated 05.01.1987, the Additional Settlement Officer (Sales) did not approve/confirm the same as the highest bid of the Petitioner was much below the reserve price. Such decision was allegedly conveyed to the Petitioner on 22.01.1987. It was also stated that the Rehabilitation Department has never authorized the Petitioner to take possession of the land in dispute and that the possession of the Petitioner is unauthorized, illegal and that of a trespasser. It is also pointed out that previously the land in question was auctioned in favour of Laxmi Chand, but since he failed to deposit the balance amount in installment, therefore, the earnest money was forfeited. The revision petition filed by Laxmi Chand was dismissed on 14.08.1986 and thereafter, the issue regarding confirmation of auction in favour of the Petitioner was considered and declined as mentioned above.
4. Subsequently, an application was filed by the State under Order 6 Rule 17 of the CPC for amendment of the written statement, which was allowed. With the amended written statement, the State has relied upon instructions dated 29.12.1981 (Annexure R-3), wherein the manner of fixation of reserve price of rural evacuee land and urban evacuee property was communicated. It is explained in the written statement that in terms of the said policy, the reserve price of the property auctioned, in which the Petitioner was the highest bidder, comes to Rs. 28,750/-. Therefore, the decision not to confirm the sale being much less than the reserve price fixed, cannot be said to be illegal and arbitrary.
5. Learned Counsel for the Petitioner has vehemently argued that the reserve price was not disclosed to the Petitioner, which was required in terms of the decision of this Court in Piara Singh v. The Chief Settlement Commissioner, Haryana. (2001) 129 PLR 683, Therefore, the State could not take into consideration the reserve price, if any fixed, to reject the highest bid of the Petitioner. It is also argued that the State has not disclosed as to on what date the reserve price was fixed, which can be made basis for rejection of the highest bid of the Petitioner. It is contended that communication putting the property to auction is not tenable and consequently the sale is liable to be confirmed in favour of the Petitioner. Learned Counsel for the Petitioner has also relied upon Full Bench judgments of this Court in Surja Ram v. State of Haryana and Anr. 1984 PLR 584 and Subhash Chand v. State of Haryana (2007) PLR 247, in support of the contention that sale in favour of the highest bidder could not be rejected for reasons which are illegal and arbitrary.
6. It is further argued by learned Counsel for the Petitioner that land was auctioned in favour of Laxmi Chand in the sum of Rs. 17,000/-, which was confirmed, but the sale process was scrapped as he has failed to deposit the sale consideration. Therefore, the Petitioner having given bid of Rs. 18,000/-, the bid in his favour should have been accepted. It is contended that the reserve price of Rs. 28,750/- was not fixed, as the sale in favour of Laxmi Chand could not have been confirmed for the sum of Rs. 17,000/-. Therefore, the reason of not confirming the sale and putting the property to re-auction is not available on record and is an after thought.
7. Having heard learned Counsel for the parties, I do not find any merit in the present petition. Rule 90 (5) of the Displaced Persons (Compensation and Rehabilitation) Rules, 1955, reads as under:
Rule 90 (5): Every auction of the property under these Rules shall be subject to reserved price fixed in respect of the property but such reserved price may not be disclosed." Rule 5 (e) of the Rules for Sale of Surplus Rural Properties reads as under:
Rule 5 (e): Every auction of a property shall be subject to a reserve price fixed in respect of the property, but such reserve price shall not be disclosed.
8. Learned Single Judge of this Court in Piara Singh''s case has set aside Sub-Rule 5 as it was found to cause manifest injustice to the society and leaves an escape route for the authority to act arbitrarily, therefore, such rule cannot be permitted to exist in the statute. In a Letters Patent Appeal No. 937 of 2002, titled The Chief Settlement Commissioner, Haryana and Anr. v. Piara Singh, the said order was affirmed on November 9, 2004, wherein it was held to the following effect:
Reverting back to Sub-rule (5), we find that the provision for nondisclosure of the reserve price to the prospective bidders is per se contrary to the scheme of Sub-rules (2) and (3) which embody the principle of transparency and fairness required to be maintained in public auctions. While Sub-rules (2) and (3) postulate issuance of a proclamation of the intended sale in the language of the principal civil court of the original jurisdiction where the property is situated and a notice of at least 15 days is required to be given specifying therein the date, time and place of the proposed sale, description of the property to be sold, its location and boundaries and terms and conditions of sale, Sub-rule (5) enables the concerned authority to put the reserve price under the veil of secrecy. The rule in question makes the confirmation of the bid dependent on an imaginary reserve price which may be fixed by the competent authority and which may not be disclosed to the bidder before or even during the auction. In our opinion, Sub-rule (5) is totally arbitrary, unfair, unreasonable and is violative of the doctrine of equality. It is beyond the comprehension of any person of reasonable prudence as to how a prospective bidder can effectively participate in a public auction of immovable property, unless he knows the reserve price. That apart, the non-disclosure of the reserve price has a serious adverse impact on the public interest because the spirit of competitiveness which should constitute the foundation of any scheme of disposal of the public property will always be missing in such a situation.
9. After setting aside Sub-Rule 5, the Court directed the writ Petitioner to pay the amount of the reserve price. It may be noticed that the property in the aforesaid case was put to auction on 25.05.1969 and the writ petition before this Court was filed in the year 1980, which was decided on 17.08.2001.
10. Since the identical provision of law i.e. Rule 90 (5) of the Displaced Persons (Compensation and Rehabilitation) Rules, 1955 has been found to be illegal, therefore for the same reason, Rule 5 Sub-clause (e) of the Rules for Sale of Surplus Rural Properties suffers from some illegality as the aforesaid rule, meaning thereby, without disclosing the reserve price, the evacuee property could not be put to sale.
11. Now the question which arises is, whether non-disclosure of the reserve price in the auction notice will confer right on the Petitioner to seek confirmation of the sale or the property should be permitted to be re-auctioned by complying with the rules, i.e. to disclose the reserve price.
12. As per the Petitioner, he has deposited Rs. 2250/- and has entered into the possession of the property. By paying meager amount of Rs. 2250/-, the Petitioner cannot derive any right to enjoy possession of the land measuring 40 Kanals. No. vested right accrued to the Petitioner merely for the reason that he has emerged as a highest bidder. Being a highest bidder, he has right for consideration of confirmation of sale, but he could not have presumed that the same will be confirmed in his favour and he can enter into possession of the property. From the averments made in the written statement, the possession of the Petitioner is said to be unauthorized and that of a trespasser. The Petitioner has not produced any communication that he was authorized to enter into possession of the property put to auction. Therefore, an unauthorized occupant cannot be permitted to seek confirmation of sale only for the reason that he has emerged as a highest bidder way back in the year 1984. Public interest would demand that the property is put to sale by disclosing the reserve price, so that all eligible persons can compete for the auction and the maximum price is secured by the sale of the evacuee property.
13. The judgments in Surja Ram''s and Subhash Chand''s cases are not helpful to the arguments raised by learned Counsel for the Petitioner. It has been held in Surja Ram''s case that the authority is bound to record reasons for refusing to accept the highest bid or other bids. To the same effect is the Full Bench judgment in Subhash Chand''s case. In the present case the Tehsildar (Sales) has recorded a note on 01.01.1987 that the highest bid is much below the reserved price. It is the said note which was approved by the Additional Settlement Officer on 05.01.1987. Therefore, the confirmation of sale is declined for the reason that highest bid is much below than the reserved price. Therefore, the ratio in aforementioned cases is not applicable to the facts of the present case as the reasons for non confirmation are available on the record.
14. Though in the written statement, the date of auction in favour of Laxmi Chand is given as 07.11.1986, but obviously that date is incorrect as the property was put to auction on 20.03.1984, in which the Petitioner was the highest bidder. As per learned Counsel for the Petitioner, auction in favour of Laxmi Chand was approximately 18 months before the date of auction in favour of the Petitioner, but after the circular was issued in 1981. The act of confirmation of sale in favour of Laxmi Chand cannot create any right in favour of the Petitioner. Even if the sale was confirmed in favour of Laxmi Chand, put such act of confirmation of sale is against the circular Annexure R-3. An illegality committed in the case of Laxmi Chand will not entitle the Petitioner to the same illegality in his favour. Reference may be made of
16. If the order in favour of the other person is found to be contrary to law or not warranted in the facts and circumstances of his case, it is obvious that such illegal or unwarranted order could not be made the basis of issuing a writ compelling the Respondent-authority to repeat the illegality to cause another unwarranted order. The extraordinary and discretionary power of the High Court under Article 226 cannot be exercised for such a purpose.
15. Therefore, even if sale in favour of Laxmi Chand was confirmed, the same does not confer any enforceable right in favour of the Petitioner.
Petition dismissed.
