Point of Law: If the impugned auction is not interfered with, it would amount to upholding partial auction and permitting perpetuation of illegality, which would be contrary to the Act and the Rules.

ORDER :

Petitioners in this batch of petitions, call in question an auction notification issued by the 3rd respondent/Arkalgud Town Panchayat, Arkalgud Town (hereinafter referred to as ‘the Panchayat’ for short) seeking to auction 61 shops out of 112 shops which are under its control. The notification of auction is issued on 20th September, 2021 seeking to auction lease of shops on 28th, 29th and 30th October, 2021. A consequential direction is also sought by issuance of a writ in the nature of mandamus to consider their representations submitted for extension of lease up to 2024.

2. Heard the learned Senior Counsel Sri Jayakumar S.Patil representing the petitioners in most of the cases and Sri Nagaiah, learned counsel for one of the petitioners, learned Additional Government Advocate representing the State and its authorities and Sri H.T.Nataraj, learned counsel appearing for the Panchayat in all these cases.

3. Brief facts leading to the filing of the present petitions, as borne out from the pleadings, are as follows:-

The petitioners claim that they are carrying on business in the shops owned by the 3rd respondent/Panchayat for more than 25 years. Initially the shops were petty shops and thereafter the Panchayat collected advance amounts from the occupants of shops and constructed RCC roofed shops in place of petty shops. After such construction the respective lessees, who were in occupation of petty shops, continued to occupy the constructed shops and carried on their business. The lease that was entered into between the Panchayat and these petitioners and the like came to an end in the year 2012.

4. On the lease coming to an end, options were called from the occupiers of shops for extension of lease. It appears that about 51 occupiers accepted the terms and conditions of lease and 61 did not. The extension of lease was made by the Panchayat on the basis of a circular issued by Government on 26th October 2009 directing that, in terms of Section 72(2) of the Karnataka Municipalities Act, 1964 the lease of properties coming under the control of Panchayats or the Municipalities, as the case would be, can be extended as per the terms and conditions stipulated in the said circular. The benefit of the circular was given to about 51 occupiers and lease was extended for 12 years from 1st April, 2012 by a resolution of the Panchayat which was approved by the Deputy Commissioner, Hassan on 18th November 2014 and a consequential order extending the lease was also approved by the Deputy Commissioner on 2nd February 2015. Therefore, the occupiers of 51 shops have continued to hold the shops on extended lease based on the strength of a Circular dated 26th October 2009 for another period of 12 years from 1st April, 2012.

5. The left out 61 occupiers approached this Court seeking extension of lease and other benefits in several writ petitions. The first of the orders that was passed by this Court was in NAGARAJU AND OTHERS v. STATE OF KARNATAKA AND OTHERS. Identical order was passed in the other writ petitions in H.S. SATHISH KUMAR AND OTHERS v. STATE OF KARNATAKA AND OTHERS, W.P.Nos. 18091 of 2016 and connected cases decided on 27th April 2016 –wherein this Court held as follows:

“5. These petitions are disposed of with an observation that when the public property is leased to the public, it shall be for a particular period and after the completion of the said period, the petitioners or the persons in occupation of the said property have to vacate the same. It is however directed that after completion of the tenancy or lease period, the same has to be notified and call for applications from the interested persons and may allot on the basis of the eligibility and reservations has to be made to the backward classes. It has been observed from the notice issued that initially, lease was granted to the petitioners in the year 1982. It is directed that the Authorities to issue public Notification calling for prospective persons to make their applicat