1 BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 11.01.2011 CORAM: THE HONOURABLE MRS.JUSTICE CHITRA VENKATARAMAN and THE HONOURABLE MR.JUSTICE T.SUDANTHIRAM W.A.(MD) No.24 of 2011 SETHURAMAN S/O.SELLADURAI V.PUDUKULAM VEMPATHUR POST SIVAGANGAI DISTRICT. .. APPELLANT VERSUS 1. THE DISTRICT COLLECTOR SIVAGANGAI DISTRICT SIVAGANGAI. 2 THE DIVISIONAL FOREST OFFICER (SOCIAL FORESTRY) SIVAGANGAI. 3 D.MOHAMED IEKRA MULLA S/O.DHARVESH MOHIDEEN 102 ATHANUR ROAD MELKARAI, MANAMADURAI SIVAGANGAI DISTRICT. .. RESPONDENTS PRAYER: Writ Appeal filed under Clause 15 of the Letters Patent against the order dated 23.12.2010 made in W.P.No.13308 of 2010 on the file of the learned single Judge of this Court. Prayer in W.P.No.13308 of 2010: Writ Petition is filed under Article 226 of the Constitution of India for the issue of a Writ of Mandamus directing the first respondent to bring the license for cutting Karuvela Trees in V.Karisalkulam Village under the first respondent by fresh auction and to conduct the auction transparently and also to permit the petitioner to participate in the said auction as per his eligibility. For petitioner : Mr.J.John For 3rd respondent : Mr.Veera Kathiravan ORDER (Order of the Court was made by CHITRA VENKATARAMAN,J.) This Writ Appeal is against the order of the learned Single Judge dated 23.12.2010 made in W.P.No.13308 of 2010. 2. The appellant herein was the third respondent in W.P.No.13308 of 2010. He was the successful bidder in an auction conducted by the second respondent namely, the Divisional Forest Officer, Sivagangai District. It https://hcservices.ecourts.gov.in/hcservices/ 2 is seen from the facts herein that the writ petitioner in W.P.No.13308 of 2010/ petitioner in Contempt Petition No.701 of 2010, sought for a Writ of Mandamus to direct the 1st respondent therein, namely the District Collector, Sivagangai District, to conduct fresh auction to licence the cutting of karuvela trees in V.Karisalkulam Village and to conduct the auction transparently and also to permit the petitioner to participate in the said auction as per his eligibility. 3. It is seen from the facts that that the second respondent herein issued a publication dated 23.8.2010 to auction the karuvela trees available in Sivagangai District by public auction. The auction date was fixed on 15.10.2010. Admittedly, the writ petitioner participated in the said auction for V.Karisalkulam Village Panchayat which is found in S.No.33 of the said notification. The writ appellant was declared as the highest bidder and the writ petitioner third respondent herein made the second offer. It is stated by the third respondent herein that due to the quarrel between the local villagers and other traders, the second respondent informed that the auction for Karisalkulam Kanmai was postponed. However, the second respondent sent proposals for confirmation of the first respondent in favour of the writ appellant who made an offer for Rs.3,41,055/-. Thus the auction was confirmed in favour of the present appellant. Before the confirmation of the offer made by the appellant herein, the third respondent submitted his objections dated 27.10.2010 along with a cheque for a sum of Rs.7,00,000/- to issue the cutting order in his favour. Since the said objection was not considered, the petitioner filed the writ petition before this Court, contending therein that the auction was not conducted properly and that the eligible contractors were not directed to participate in the auction apart from the fact that there was no transparency in the conduct of the auction. The third respondent made an offer for Rs.7,00,000/-. Noting the higher offer made by the third respondent herein at Rs.7,00,000/- and the earlier offer made and accepted was at Rs.3,41,055/-, an interim order of injunction was passed by this Court on 02.11.2010, granting injunction till 15.11.2010 that if no confirmation had been made, the claim of the petitioner had to be considered. However, having got the knowledge of the same, the second respondent, namely, the District Forest Officer, confirmed the the sale and handed over the confirmation order to the writ appellant herein and ante- dated the same. This resulted in the filing of a contempt petition in Contempt Petition No.701 of 2010. 4. It is seen from the documents filed before this Court that the appellant herein filed an application dated 14.12.2010 before the second respondent wherein apart from contesting the claim of the third respondent, the writ appellant offered to bid at Rs.7,30,000/- and that since he had already paid a sum of Rs.3,41,055/-, he was ready to remit a further sum of Rs.3,88,945/- to make up for the total of Rs.7,30,000/-. Consequently, the writ appellant sought for granting the licence to the appellant herein to cut and remove the karuvela trees. Considering the rival contention, learned single Judge pointed out that the offer made by the third respondent at Rs.7,00,000/- was evidently much above what had been offered by the writ appellant. The paramount consideration of conducting public auction being to get the highest revenue to the Government, learned Single Judge pointed out that the bona fides of the third respondent stood proved by the affidavit filed on 21.12.2010, quoting a sum of Rs.8,00,000/- https://hcservices.ecourts.gov.in/hcservices/ 3 as his final offer. He had also taken a Demand Draft for a sum of Rs.8,00,000/- on 22.12.2010. The same was produced before the Court for perusal. In the meantime, the writ appellant herein also increased his offer to Rs.7,30,000/-. Having regard to the said facts, learned single Judge pointed out that it was clear that the valuation quoted by the writ appellant in the auction sale held on 15.10.2010 was not reflecting the actual value of the trees. 5. Referring to the unreported decision of this Court in W.A.(MD) Nos.97 and 98 of 2007 (A.Ramasamy Vs. P.Ramasamy @ Poochi and others) dated 04.04.2007, as well as the decision reported in 2007 (10) Scale 549 (Agarwal & Modi Enterprises Pvt. Ltd. & Another Vs. New Delhi Municipal Council), learned single Judge held that considering the huge difference between the amount quoted by the writ appellant in the auction held on 15.10.2010 and the present value offered, interest of justice would be met by directing the first respondent therein to conduct a re-auction for the sale of the karuvela trees in V.Karisalkulam Village Panchayat, Sivagangai District, by fixing Rs.8,00,000/- as the upset price. Accordingly, the writ petition was allowed directing the third respondent herein, to deposit the demand draft before the second respondent Divisional Forest Officer, who, in turn, was directed to conduct the re-auction by giving opportunity to all persons including the villagers of V.Karisalkulam Village Panchayat, to participate in the fresh auction. This Court further pointed out that the third respondent should deposit the Demand Draft on or before 31.12.2010 and that if the third respondent did not deposit the said Demand Draft for a sum of Rs.8,00,000/-, the writ appellant may be given the licence to cut the karuvela trees, as he was the highest bidder in the auction held on 15.10.2010, now increased by the writ appellant to Rs.7,30,000/- by representation dated 14.12.2010. Aggrieved by the said order, the present writ appeal is filed. 6. Learned counsel appearing for the appellant pointed out that when the second respondent had accepted the bid amount offered by the writ appellant, declaring him as the highest bidder, there was no ground for upsetting the licence to be granted to him. Further, the third respondent had participated in the auction proceedings but was declared as unsuccessful. However, long after the confirmation of auction, he had filed an objection petition 12 days thereafter, offering a sum of Rs.7,00,000/- for which he had not even given the cheque to the second respondent herein In the circumstances, there was no justification for cancelling the auction confirmed in his favour. In so contending, learned counsel appearing for the appellant placed reliance on the decision reported in (2008) 9 SCC 299 (Valji Khimji & Co. Vs. Official Liquidator of Hindustan Nitro Product (Gujarat) Ltd.) particularly to paragraph 20, wherein, the Apex Court pointed out that all the bidders in the auction knew what they were bidding for and that there was no reason to entertain an objection to the auction to hold it again. In the circumstances, learned counsel submits that the order of the learned single Judge suffers a legal infirmity. 7. We do not find any ground to disturb the order passed by the learned single Judge who had considered in detail the contention of the writ appellant as well as the contesting third respondent. It is relevant to note herein that one of the clauses in the auction notice was that anyone who is objecting to the auction conducted, particularly as to the amount https://hcservices.ecourts.gov.in/hcservices/ 4 offered, has to enclose a cheque for the amount for which they are offering the bid along with the objection, for re-consideration. The provision in the tender conditions thus clearly pointed out that the said tender condition has been introduced to meet the interest of the Panchayat to get better revenue from the tender proceedings. The safeguard that has been provided as against any fancy objection is that the objector must enclose a cheque for the amount for which he makes his offer for participating in the auction, along with his objection letter. 8. It is not denied by the appellant that this Court had passed an order of injunction on 02.11.2010 till 15.11.2010. With the knowledge as to the order of injunction dated 02.11.2010, restraining the second respondent from confirming the sale, the second respondent hastily confirmed the auction in favour of the writ appellant, which had resulted in the contempt petition before this Court. 9. It is also worthwhile to note herein the conduct of the appellant On 14.11.2010, the appellant, noting the better offer from the third respondent herein, hiked his offer by a further sum of Rs.3,88,945/- thereby bidding at a sum of Rs.7,30,000/-, a course for which there is no explanation from the appellant herein. If the writ appellant had really felt that the offer made by him originally and accepted by the first and second respondents at Rs.3,41,055/- was the correct value, there was no need at all for the writ appellant to now increase his bid to Rs.7,30,000/-. In the circumstances, going by the tender clauses as well as by the conduct of the writ appellant, learned single Judge rightly pointed out that the paramount consideration in conducting public auction is to get highest amount so that the Government would get more revenue. Learned single Judge further held that the bona fides of the third respondent herein was proved by way of affidavit filed on 21.12.2010, quoting a sum of Rs.8,00,000/- as a final offer. In the light of the above-said submission and on being satisfied that the upset price could very well be fixed at Rs.8,00,000/-, learned single Judge ordered a re-auction. In so ordering a re-auction, we do not find any illegality, as had been contended by the learned counsel appearing for the appellant. 10. As regards the decisions relied on by the learned counsel appearing for the appellant, we do not find any assistance could be drawn from the decision reported in (2008) 9 SCC 299 (Valji Khimji & Co. Vs. Official Liquidator of Hindustan Nitro Product (Gujarat) Ltd.) where the issue was as regards the auction in the course of liquidation proceedings The Apex Court pointed out that entertaining an objection after the sale was confirmed should not be ordinarily allowed unless there are allegations of fraud or lack of publicity. The observation made therein show that the respondent therein never participated in the auction. As such, filing of objection to the auction one year after the confirmation of the sale, could not be entertained. Having regard to the wide difference between the price offered by the appellant herein and subsequently revised by him and the offer made by the third respondent and further, considering the tender conditions, we do not find any good ground to upset the order of the learned single Judge. It must be noted that the terms of tender conditions do not prohibit any participant from making objection on the auction held and increasing his offer before the confirmation of sale. Taking note of the better offer made, rightly this Court directed the second respondent to hold https://hcservices.ecourts.gov.in/hcservices/ 5 re-auction, which would ultimately result in better revenue to the Panchayat and which would be in the interest of the Panchayat Board. In the circumstances, this writ appeal stands dismissed. No costs Connected M.P.No.1 of 2011 also stands dismissed. Sd/- Assistant Registrar(Writs) /TRUE COPY/ Sub Assistant Registrar To: 1. THE DISTRICT COLLECTOR SIVAGANGAI DISTRICT SIVAGANGAI. 2 THE DIVISIONAL FOREST OFFICER (SOCIAL FORESTRY) SIVAGANGAI. +1CC TO MR.J.JOHN, ADVOCATE SR.NO.1135 +1CC TO MR.VEERA KATHIRAVAN, ADVOCATE SR.NO.1351 +1CC TO THE SPECIAL GOVT.PLEADER SR.NO.1625 W.A.(MD) No.24 of 2011 Dated: 11.01.2011 ksv PA/22.01.2011/5P/6C https://hcservices.ecourts.gov.in/hcservices/