Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2022 Supreme(SC) 293

SUPREME COURT OF INDIA
(From the High Court of Punjab & Haryana at Chandigarh)
HEMANT GUPTA, V. RAMASUBRAMANIAN, JJ.
The Municipal Committee, Barwala, District Hisar, Haryana Through Its Secretary/President – Appellant
Versus
Jai Narayan and Company & Anr. – Respondents
Civil Appeal No. 2222 of 2022 (Arising out of SLP (Civil) No. 16530 of 2018)
Decided On : 29-03-2022

Advocates appeared:
For the Appellant(s) : Mr. Praveen Kumar Aggarwal, Adv. Mr. Abhishek Grover, Adv. Mr. Sanjay Jain, AOR
For the Respondent(s): Mr. Sanchar Anand, Adv. Mr. Anant K. Vatsya, Adv. Ms. Vartika Gupta, Adv. Mr. Shiv Kumar, Adv. Mr. Vivak Mishra, Adv. Mr. Sameer Singh, Adv. Mr. Vijay Kumar Singh, Adv. Mr. Devendra Singh, AOR

The main legal point established in the judgment is the requirement for confirmation of sale by the Deputy Commissioner and the limitations on the rights of the highest bidder in a public auction. The court emphasized the importance of compliance with statutory provisions and the consequences of illegal possession of land.

Headnote:
Municipal Committee - Land Dispute - Haryana Municipal Common Lands (Regulation) Act, 1974, Rule 2(4) of the Haryana Municipalities Management of Municipal Properties and State Properties Rules, 1976 - The court discussed the provisions of the Haryana Municipal Common Lands (Regulation) Act, 1974 and Rule 2(4) of the Haryana Municipalities Management of Municipal Properties and State Properties Rules, 1976. The court highlighted the requirement for confirmation of sale by the Deputy Commissioner and the limitations on the rights of the highest bidder in a public auction. The court also emphasized the importance of compliance with statutory provisions and the consequences of illegal possession of land.
Fact of the Case:

The respondent-plaintiff claimed title and possession of land after an open auction conducted by the Sub-Divisional Officer, Hisar. The Municipal Committee failed to execute the sale deed, leading to a civil suit for mandatory injunction. The courts below granted the plaintiff a decree for mandatory injunction, which was challenged by the Municipal Committee.
Finding of the Court:

The court found that the decree passed by the lower courts was a perverse reading of the law and factual position. It held that the plaintiff's possession was illegal and without the authority of law. The court set aside the judgment and decree passed by the lower courts and directed the Municipality to take possession of the land, forfeiting the amount deposited by the plaintiff.
Issues: The issues included the entitlement of the plaintiff to a decree for mandatory injunction, non-maintainability of the suit due to non-joinder of necessary parties, suppression of material facts by the plaintiff, and the locus standi of the plaintiff to file the suit.
Ratio Decidendi: The court emphasized the requirement for confirmation of sale by the Deputy Commissioner and the limitations on the rights of the highest bidder in a public auction. It also highlighted the consequences of illegal possession of land and the importance of compliance with statutory provisions.
Final Decision: The appeal was allowed, and the judgment and decree passed by the lower courts were set aside. The plaintiff's possession was found to be illegal, and the Municipality was directed to take possession of the land, forfeiting the amount deposited by the plaintiff.

JUDGMENT :

Hemant Gupta, J.

1. The Municipal Committee, Barwala¹[For short, the "Municipal Committee”] is in appeal against the judgment dated 1.5.2018, whereby its second appeal was dismissed arising out of a suit for mandatory injunction to execute a sale deed in respect of land measuring 55 kanals 5 marlas sought by the respondent-plaintiff.

2. The respondent-plaintiff claimed title and possession on the basis of an open auction conducted by the Sub-Divisional Officer, Hisar on 23.3.1999 @ Rs.2,32,000/- per acre after sanction was granted for auction of the land in question on 25.10.1995. The total sale consideration comes out to be Rs.15,76,150/- which was deposited with the Municipal Committee. The plaintiff thus claimed that he is a bonafide purchaser and is in possession as owner of the suit land. He deposited the remaining consideration after adjusting an amount of Rs. 4,10,000/- which was already deposited with the Municipal Committee.

3. The plaintiff asserts that the Municipal Committee had passed a resolution on 1.5.2002 to get the sale deed executed and registered. Since the sale deed was not executed, the plaintiff had allegedly served a registered notice dated 14.8.2006 which was made the cause of action to file the civil suit for mandatory injunction on 13.6.2011.

4. In the written statement filed by the Municipal Committee, it has been admitted that the property was put to auction after obtaining permission from the Deputy Commissioner. However, the possession of the plaintiff was said to be illegal possession. It was pleaded that the Municipal Committee is unable to execute the sale deed without proper sanction of the competent authority i.e., Government of Haryana.

5. The learned trial court decreed the suit vide judgment and decree dated 9.3.2016 after giving findings on the following issues framed in view of the pleadings of the parties:

2. Whether the suit is not maintainable due to non-joinder of necessary parties?

3. Whether the plaintiff has not come to the Court with clean hand and suppressed the material facts?

4. Whether the plaintiff has no locus standi to file the present suit?

5. Relief."

6. Aggrieved against the judgment and decree of the trial court, the Municipal Committee filed the first appeal which was dismissed on 5.9.2016. The second appeal was also dismissed vide impugned judgment dated 1.5.2018.

7. Before this Court, learned counsel for the appellant argued that the auction conducted in which the plaintiff was the highest bidder was not approved by the State Government. The Ex.P/34 is a communication addressed by the Deputy Commissioner to the Director Local Bodies to seek approval of the property put to auction. However, there was no approval by the State Government of the auction once conducted in favor of the plaintiff. It was contended that till such time the auction is confirmed, mere fact that the plaintiff was the highest bidder would not confer any equitable and legal right to him. It is only after the confirmation of sale and the letter accepting the bid is issued, the plaintiff could claim any enforceable right. It was thus contended that the plaintiff is in unauthorized and illegal possession of the property. It was contended that the approval of sale of the property by public auction itself does not amount to confirmation of the auction, therefore, in the absence of confirmation of sale by the State Government, the plaintiff would not get any right over the property. It was also argued that the plaintiff in his counter affidavit before this Court relied upon Section 5 read with Section 10(2)(e) of the Haryana Municipal Common Lands (Regulation) Act, 1974,²[For short, the "1974 Act"] read with Rule 2(4) of the Haryana Municipalities Management of Municipal Properties and State Properties Rules, 1976,³[For short, the "1976 Rules"], though the 1974 Act has been declared unconstitutional by the Full Ben

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