1. Whether, in the realm of private contracts, not involving statutory provisions, an auction purchaser who is declared successful bidder in a public auction conducted by the State through its instrumentality, for sale of land owned by it, but failed to pay the balance sale consideration in terms of the terms and conditions of agreement and provisional order of allotment, on the plea that litigation had ensued as to the title of the property, can maintain a writ petition under Article 226 of the Constitution of India for refund of the amount deposited with interest, is the question involved in this batch of appeals filed by the Hyderabad Metropolitan Development authority against the order of the learned single Judge directing refund of the amount deposited within three months.

2. While W.A.Nos.477, 478, 479, 480, 481, 482, 484, 485 and 954 of 2010 are directed against the common order passed in W.P.No.18341 of 2009 and batch dated 22.4.2010, W.A.Nos.650 and 808 of 2010 are directed against the order dated 14.6.2010 passed by the learned single Judge in W.P.Nos.28553 and 28566 of 2009 respectively allowing the writ petitions in terms of the order passed in W.P.No.18341 of 2009 and batch. Inasmuch as W.A.Nos.477, 478, 479, 480, 481, 482, 650 and 808 of 2010 are filed by the Hyderabad Urban Development Authority (now reconstituted as Hyderabad Metropolitan Development Authority); W.A.Nos.484, 485 and 954 of 2010 are filed by some of the auction purchasers in not granting interest by the learned single Judge on the amounts directed to be refunded.

Since a similar question arose for consideration in Writ Petition Nos.2776 of 2009 and 12786 of 2010 filed by other auction purchasers, they were also heard together and are being disposed of by this common judgment.

Background facts:

3. Before we consider the issue, it is necessary to refer to few facts leading to the controversy:

For convenience sake, the parties will be referred to by their status in the writ petitions. We will first refer to the facts leading to the filing of the Writ Petitions out of which the Writ Appeals arose.

The Hyderabad Metropolitan Development Authority (for short ‘HMDA’) launched a project known as “Golden Mile” for auction of about 100 acres of land owned by the State of Andhra Pradesh in Sy.Nos.100, 109, 114, 116, 117 and 147 part situated on the outer ring road at Kokapet Village, Rajendera Nagar Mandal, Rangareddy District, both for residential and commercial ventures. The land was divided into Sites I, II and III. Site No.1 consists of 12 plots in Sy.Nos.100, 109 and 114. Site II consists of 4 four plots in Sy.No.116 and 117 and Site III also consists of four plots in Sy.No.147 part, totaling to 20 plots in all. Each plot consists of an extent ranging from 1 to 6 acres. Advertisement was issued by HMDA in local news papers on 27.6.2006 for sale of the plots through a public auction proposed to be held on 20.7.2006 through sealed tenders on ‘as is where is condition’ basis. The advertisement says that the plots proposed for sale is ideal for development of Star Hotels, Health Care, Financial Institutions, IT/TES Companies, Corporate Offices and High-rise apartments etc. and the land use of the plots is multiple use zone as per the Master Plan. Participation in the auction was by way of purchase of application from HMDA. The sale of plots will be on public-auction-cum sealed tender basis. The upset price per acre was fixed at Rs.4.50 crores and the EMD at Rs.2.00 crores.

The brochure supplied to the applicants contains statement showing the details of each site with survey number and approximate extent of land. As per the terms and conditions of auction, applicants having the tokens issued by HMDA on the day of auction are only permitted to participate in the auction with permit pass. 50% of the sale price shall be payable towards Initial Deposit (ID) which includes Earnest Money Deposit (EMD). After deducting the EMD amount, the balance amo