AJAY KUMAR BOTHRA & ORS. VS. STATE OF RAJASTHAN & ORS. (S.B.CIVIL WRIT PETITION NO.1579/07) 1 AJAY KUMAR BOTHRA & ORS. VS. STATE OF RAJASTHAN & ORS. (S.B.CIVIL WRIT PETITION NO.1579/07) Dated:- 8th July,2009. HON'BLE MR.JUSTICE SANGEET LODHA Mr. H.S.Sidhu, for the petitioners. Mr. Rajesh Joshi, for the respondents. 1. In this writ petition, the petitioners have assailed validity of resolution adopted by the Municipal Board, Pilibanga in its meeting held on 6.3.07, whereby sale of plots made in favour of the petitioners by open auction has been treated to be automatically cancelled and 1/4th of the bid amount deposited by the petitionesr has been forfeited. 2. The respondent Board issued a notice dated 20.10.05 for auction of various residential and commercial plots on 99 years lease basis. The auction of residential plots in Sector No. 3 , Pilibanga was held on the date notified i.e. 18.11.05. The petitioner nos. 1 to 3 being aspirant to purchase residential plots participated in the auction of the plots no. 47 to 49 respectively. Being the highest bidder, the auction of the said plots was knocked down in favour of the petitioners . As per the terms and conditions of the auction, the petitioners deposited 1/4th of the bid amount on the same day. The auction of the various plots conducted in terms of auction notice dated 20.10.05 was confirmed by the respondent Municipal Board in its meeting held AJAY KUMAR BOTHRA & ORS. VS. STATE OF RAJASTHAN & ORS. (S.B.CIVIL WRIT PETITION NO.1579/07) 2 on 21.11.05. Thereafter, vide notice dated 7.12.05, the petitioners were informed to deposit remaining 3/4th bid amount within a period of 30 days from the date of receipt of the notice. The notices were served upon the petitioners on 12.1.06 . Accordingly, the petitioners deposited the remaining 3/4th of the bid amount on 6.2.06 by the Demand Drafts . However, the drafts submitted by the petitioners as aforesaid were not deposited by the Executive Officer of the respondent Board in the bank account of the respondent Board. Even, the receipts of the drafts submitted by the petitioners were not issued by the respondent Board. In these circumstances, the petitioners made representations to the Sub Divisional Officer, Pilibanga on 19.4.06 and 4.5.06. On information being sought by the Tehsildar( Revenue), Pilibanga under the directions of Sub Divisional Officer, Pilibanga, vide communication dated 6.5.06, it was intimated by the Executive Officer, Pilibanga to the Tehsildar (Revenue), Pilibanga that the drafts submitted by the petitioners on 10.2.06 were presented before the Chairman of the respondent Board but the directions for deposit of the drafts were issued by the Chairman only on 29.4.06 therefore, the delay has been caused in depositing the drafts. 3. After due inquiry, the Sub Divisional Officer, Pilibanga submitted a report to the District Collector, Hanumangarh with AJAY KUMAR BOTHRA & ORS. VS. STATE OF RAJASTHAN & ORS. (S.B.CIVIL WRIT PETITION NO.1579/07) 3 the categorical finding that the Executive Officer of the respondent Board is guilty for depositing the six drafts of an amount of Rs. 2,49,750/- with a delay of 78 days and therefore, the loss of the interest caused to the respondent Board deserves to be recovered from the Executive Officer. That apart, the Sub Divisional Officer recommended that the applicants should be issued the receipts of the amount deposited and the possession of the plots should also be handed over to them in accordance with the rules. The report of the Sub Divisional Officer, Pilibanga with a necessary recommendation was forwarded by the District Collector, Hanumangarh to the Director, Local Bodies vide communication dated 11.10.06. 4. Instead of issuing the receipts of the amount deposited , the Executive Officer of the respondent Board vide communication 28.9.06 informed the petitioners that the deposit of the amount by them has been entered in general cash book of the respondent Board at Sr. No. 22, which may be treated to be receipt of the amount deposited. 5. Even after the recommendations made by the District Collector as aforesaid, the lease deeds were not executed and the possession of the plots was not handed over , therefore, the petitioners made a representation to the Chairman, Public Grievances Redressal Committee, on 23.2.07. AJAY KUMAR BOTHRA & ORS. VS. STATE OF RAJASTHAN & ORS. (S.B.CIVIL WRIT PETITION NO.1579/07) 4 6. The authorities of the respondent Board persisting in their obduracy neither handed over the possession of the plots to the petitioners nor the lease deeds were executed in their favour and now vide a resolution adopted by the respondent Board in its meeting held on 6.3.07, the auction of the plots made in favour of the petitioners has been treated to be automatically cancelled in terms of the condition f (i) & (ii) of Annexure-A attached to the Rajasthan Municipalities (Disposal of Urban Land) Rules, 1974( in short “the Rules of 1974” hereinafter) and accordingly, the 1/4th bid amount deposited by the petitioners has been forfeited. Hence, this petition. 7. It is submitted by the learned counsel for the petitioners that the resolution adopted by the respondent Board in its meeting held on 6.3.07 is ex facie illegal, arbitrary and mala fide. It is submitted by the learned counsel that the notice dated 7.12.05 was served upon the petitioners on 12.1.06 and they have deposited the remaining amount on 6.2.06 therefore, by no stretch of imagination , it can be said that the petitioners have failed to deposit the amount within the stipulated period of thirty days from the date of the receipt of the notice. It is submitted by the learned counsel that before adopting the resolution , cancelling the auction made in favour of the petitioners, no opportunity of hearing was given to them. The learned counsel AJAY KUMAR BOTHRA & ORS. VS. STATE OF RAJASTHAN & ORS. (S.B.CIVIL WRIT PETITION NO.1579/07) 5 submitted that as a matter of fact, the impugned action taken by the respondent Board in arbitrary manner falls foul of Article 14 of the Constitution of India. The learned counsel submitted that the impugned resolution has been adopted by the respondent Board just to penalise the petitioners inasmuch as, father of the petitioner no. 1 made complaints against the Chairman and member of the Board regarding the illegal encroachments made on the public roads, which were ultimately ordered to be removed in a Public Interest Litigation by this Court. 8. Per contra,the learned counsel appearing on behalf of the respondents submitted that in the instant case, the auction was held on 18.11.05 and after depositing the 1/4th amount on the same day , the petitioners were required to deposit remaining amount within 30 days thereafter, i.e. latest by 17.12.05 and thereafter, the amount could have been deposited with interest @ 15% p.a. upto 17.1.06. It is submitted that since the petitioners have failed to deposit the 3/4th amount in conformity with clause f(i) & (ii) of Annexure A attached to the Rules of 1974 therefore, the resolution adopted by the respondent Board cannot be faulted with. It is submitted that since the amount was not deposited within the stipulated period and therefore, the auction automatically stood cancelled and there was no occasion for the authorities of the respondent Board to accept the amount AJAY KUMAR BOTHRA & ORS. VS. STATE OF RAJASTHAN & ORS. (S.B.CIVIL WRIT PETITION NO.1579/07) 6 tendered after the stipulated period. Accordingly, it is submitted by the learned counsel that the impugned resolution adopted by the respondent Board does not suffer from any infirmity or illegality. 9. Admittedly, the transfer of lease hold rights in urban land within the municipal areas is governed by the Rules of 1974. The controversy involved in this writ petition rolls around clause f (i) & (ii) of Annexure A which prescribes the procedure to be adopted for sale of plots by public auction. To appreciate the contentions raised on behalf of the parties, it will be beneficial to quote the clause f(i) & (ii) of Annexure A ,which reads as under:- “(f)(i)The successful bidder shall be required to deposit one-fourth of the amount of his bid forthwith on the acceptance of the bid and the remaining three-fourth of the amount of the bid shall be deposited by him within one month of the acceptance of the bid and in case of failure to deposit within the next thirty days interest @ 15% per annum shall be charged retrospectively from the date of acceptance of the bid: Provided that in case of default in depositing the three-fourth amount of bid within the period prescribed above, the one-fourth of the amount of the bid deposited by the petitioner shall be forfeited and auction of land shall automatically stand cancelled: Provided further that the board may regularize such auction of land withdrawing automatic cancellation within a period of ten months from the date of such automatic cancellation in the successful bidder is prepared to pay the three-fourth amount of the bid money plus interest @ 15% per annum upto the regularisation of auction of land and in addition also an amount of penalty at the following rates:- AJAY KUMAR BOTHRA & ORS. VS. STATE OF RAJASTHAN & ORS. (S.B.CIVIL WRIT PETITION NO.1579/07) 7 Amount of the bid money Penalty after the date of Automatic cancellation (a) not exceeding Rs.5,000/- Rs.250/- p.m. (b) exceeding Rs.5,000/- and upto Rs.10,000/- Rs. 500/- p.m. (c ) exceeding Rs.10,000/- Rs. 1,000/- p.m. The amount of penalty mentioned in clause (a), (b) and (c ) above shall not exceed the principal amount. (ii)After the expiry of the period of ten months from the date of the said automatic cancellation, the board shall have no power to regularize such auction of land in any case.” 10. A bare perusal of clause f(i) makes it apparently clear that after depositing 1/4th of the bid amount forthwith on the acceptance of the bid and the remaining 3/4th amount is required to be deposited by the successful bidder within one month from the acceptance of the bid . It is true that the 1/4th amount was deposited by the petitioners on the same day but the fact remains that the auction sale was confirmed by the respondent Board in its meeting held on 21.11.05 and thereafter, a notice directing the petitioners to deposit the remaining 3/4th bid amount within a period of 30 days from the date of receipt of the notice was issued on 7.12.05. The petitioners have taken categorical stand that the said notice was served upon them on 12.1.06 which is not disputed by the respondents in their reply. The stand taken by the respondents is that there was no AJAY KUMAR BOTHRA & ORS. VS. STATE OF RAJASTHAN & ORS. (S.B.CIVIL WRIT PETITION NO.1579/07) 8 question of giving notice as per the Rules of 1974. There is nothing on record to show that the bid was accepted by the respondent Board moment the auction was knocked down in favour of the petitioners. Moreover, if the highest bid of the petitioners were accepted on 18.11.05 itself, then there was no occasion for the respondent Board to adopt a resolution for confirmation of the auction of plots conducted on 16.11.05 to 18.11.05 and to issue the notice as aforesaid directing the petitioners to deposit the amount within the stipulated period. Even if it is assumed for the sake of arguments that the drafts were not submitted by the petitioners on 6.2.06 but then, this is not in dispute that the drafts were received by the Executive Officer on 10.2.06. Indisputably, since the notice directing the petitioners to deposit the 3/4th amount were received by them on 12.1.06 therefore, the amount deposited by them on 10.2.06 cannot be said to have been deposited after the lapse of the stipulated period. In these circumstances, the respondent Board has seriously erred in treating the auction sale made in favour of the petitioners automatically cancelled for not depositing the amount within the stipulated period. 11. There is yet another aspect of the matter. In terms of proviso to clause f(i), a successful bidder is entitled to deposit the amount within next 30 days from the expiry of the stipulated AJAY KUMAR BOTHRA & ORS. VS. STATE OF RAJASTHAN & ORS. (S.B.CIVIL WRIT PETITION NO.1579/07) 9 period of one month from the date of acceptance of the bid with interest @ 15% therefore, the respondent Board could not have treated the auction sale to be automatically cancelled and was not justified in directing forfeiture of the 1/4th amount deposited, on account of alleged failure of the petitioners to deposit the amount within the stipulated period. That apart, as per proviso to Rule f(i), even after automatic cancellation of the auction , the Board is competent to regularise the auction within a period of ten months from the date of such automatic cancellation if the successful bidder is ready to pay 3/4th of the bid money plus interest and penalty at the rate prescribed. Thus, viewed from any angle, the impugned resolution adopted by the respondent Board is not sustainable in eye of law. 12. In the result, the writ petition succeeds, it is hereby allowed. The impugned resolution No. 3 as contained in the minutes of the meeting of the respondent Board dated 6.3.07 (Annexure P/23) is quashed and set aside. The respondent Board is directed to hand over the possession of the plots to the petitioners and execute the lease deed in their favour within a period of one month from the date of this order. No order as to costs. (SANGEET LODHA),J. Aditya/-