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SUPREME COURT OF INDIA
Arun Mishra, Amitava Roy, JJ.
Haryana Urban Development Authority & Ors. – Appellants
Vs.
Orchid Infrastructure Developers P. Ltd. – Respondent
CIVIL APPEAL NO. 1016 OF 2017 (Arising out of SLP [C] No.12166/2011)
Decided On : 27-01-2017
(2013) 5 SCC 182; (1982) 2 SCC 365; (1996) 4 SCC 208; (2009) 6 SCC 171 – Relied upon
(1990) 3 SCC 280; AIR 1978 SC 851 : (1978) 1 SCC 405; (2008) 10 SCC 696 – Distinguished
(b) Haryana Urban Development Authority Act, 1977 – Section 51 – Chief Administrator delegating his power to Administrator u/s 51(1) – Respondent challenging rejection of its bid on ground of absence of delegation of power u/s 51(4) – Obviously, respondent had knowledge of delegation u/s 51(1) – Ought to have challenged – Not done – Respondent also suppressing its knowledge of delegation u/s 51(1) As per tender notice Administrator was the Presiding officer empowered to accept or reject the bid(s) – Held, Administrator was competent to reject the respondent’s bid. (Para 23)
© Haryana Urban Development (Disposal of Land and Buildings) Regulations, 1978 – Regulation 6 – Administrator rejecting respondent’s bid upon duly considering the report of the Auction committee – Report though not produced in court but content thereof pleaded in written statement – Held, rejection of the bid absolutely proper and justified. (Para 26)
(d) Administration of justice – Maintainability of suit – Reserve price of property in question not fixed in fair manner – No official of HUDA examined – Neither respondent nor HUDA placing the delegation of power to Administrator on record – Secondly, respondent not paying ad valorem fee – Held, suit was not maintainable. (Para 33, 34)
Facts of the case:
This case relates to rejection of bid of the respondent by the appellant without assigning any reason despite it being the highest.
Result: Appeal dismissed with cost
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JUDGMENT
ARUN MISHRA, J.
1. Leave granted.
2. The appeal arises out of judgment and order dated 17.1.2011 passed by the High Court of Punjab & Haryana at Chandigarh thereby setting aside the judgment and decree of District Judge dated 29.11.2010 and restoring the judgment and decree of Civil Judge passed on 14.10.2010. The plaintiff Bhudeep Builders and Exporters Pvt. Ltd. were later renamed as M/s. Orchid Infrastructure Developers P. Ltd. The plaintiff-respondent filed a suit for declaration with consequential relief as against the appellants with regard to rejection of bid relating to the commercial tower situated in Sector 29, Urban Estate, Gurgaon, in area admeasuring 9.527 acres. The bid submitted by the plaintiff was the highest of Rs.11,17,50,000/-. The reserve price was Rs.106.65 crores. The main terms and conditions of the auction were as under :
(i) 10% of the bid amount to be tendered on the spot at fall of hammer.
(ii) 15% of the bid money to be deposited within 30 days from the date of issuance of allotment letter.
(iii) 75% of the amount to be paid within 60 days from issuance of allotment letter as one time interest free payment or with interest in the manner prescribed.
(iv) The Presiding Officer (Administrative Officer) reserved the right to withdraw any property from the auction or reject any bid without assigning any reason.
3. It is further averred in the plaint that the auction held on 24.5.2004 was presided over by the Administrator, Haryana Urban Development Authority (for short ‘HUDA’). Reserve price had been approved by Chief Administrator, HUDA. Though the reserved price for the other sites were approved by the Administrator. In the plaint it was further averred that 27 persons deposited the security amount of Rs.50 lakhs for bidding and various bidders actively participated in the bids. Ultimately the bid of the plaintiff amounting to Rs.111.75 crores being highest was accepted. Petitioner deposited 10% amount by various drafts on the fall of hammer. Formal letter of allotment was not issued inspite of efforts made by the plaintiff. Officials of HUDA were dragging their feet over the issue without any rhyme or reason.
Plaintiff ultimately received memo dated 24.9.2004 purporting to refund 10% amount Rs.11,17,50,000 deposited by the plaintiff at the time of auction held on 24.5.2004 on the ground that the bid had not been accepted.
4. Plaintiff questioned the rejection of the bid on the ground of its being illegal, unlawful, mala fide, arbitrary, discriminatory and violative of principles of natural justice. The bid for the commercial tower was adequate and above the reserved price. The plaintiff relied upon Regulation 6 regarding issuance of allotment letter by Chief Administrator. The rejection of the bid is without any rhyme or reason. The order is non-speaking. There was no material available with the defendant to conclude that auction of property in question was made at a lower rate or that the same would fetch a higher price in the event of re-auction. The Chief Administrator alone was competent to decide about the bid and no delegation of power to Administrator has been shown to the plaintiff. Mere baseless apprehension harboured by the defendant that the auction could fetch a higher rate, could not be said to be in public interest. If such action is permitted, auction process shall be a never ending exercise. The plaintiff valued the suit for declaration and consequential relief of mandatory injunction at Rs.400 and paid the court fee of Rs.55. Plaintiff has prayed for a declaration that memo dated 24.9.2004 rejecting the bid of the plaintiff to be void ab initio, non est and illegal, and that plaintiff is successful bidder of commercial tower measuring 9.527 acres situated in Sector 29, Urban Estate, Gurgaon. Plaintiff further prayed for mandatory injunction directing the defendants to iss
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