A minor cannot be a purchaser at an auction sale as a minor is incapable of entering into a valid agreement and cannot incur the liabilities and obligations of an auction purchaser.

Headnote:
AUCTION SALE - MINOR AS PURCHASER - BOMBAY LAND REVENUE CODE, 1879 - SECTIONS 165, 173, 174, 175, 176, 178, 179, 181 - BOMBAY PREVENTION OF FRAGMENTATION AND CONSOLIDATION OF HOLDINGS ACT, 1947 - SECTION 31, 31AA - TRANSFER OF PROPERTY ACT, 1882 - SECTIONS 6(H), 7 - SALE OF LAND IN EXECUTION OF AWARD - MINOR AS HIGHEST BIDDER - VALIDITY OF SALE - WHETHER MINOR CAN BE A PURCHASER AT AUCTION SALE - WHETHER AUCTION SALE AMOUNTS TO A COMPLETED TRANSFER OR CONTRACT - WHETHER RIGHTS AND OBLIGATIONS OF AUCTION PURCHASER ARE STATUTORY OR CONTRACTUAL.
Fact of the Case:

In execution of an award passed against the first petitioner, a land was put up for auction sale under the provisions of the Bombay Land Revenue Code. The first respondent, a minor, gave the highest bid and the bid was accepted by the officer conducting the sale. The petitioners applied to set aside the sale on the grounds of material irregularity in the proclamation of sale, contravention of Section 31 of the Bombay Prevention of Fragmentation and Consolidation of Holdings Act, 1947, and the minority of the first respondent.
Finding of the Court:

The court held that the omission to mention two wells in the proclamation of sale was not a material irregularity as the land was sold at an adequate price and no substantial loss was caused to the petitioners. The court further held that the auction sale did not contravene Section 31(a) of the Bombay Prevention of Fragmentation and Consolidation of Holdings Act, 1947, as a completed transfer of the land had not yet taken place. However, the court held that the acceptance of a minor's bid at the auction was an illegality which vitiated the sale as a minor is incapable of entering into a valid agreement and cannot incur the liabilities and obligations of an auction purchaser.
Issues: 1. Whether the omission to mention two wells in the proclamation of sale was a material irregularity. 2. Whether the auction sale contravened Section 31(a) of the Bombay Prevention of Fragmentation and Consolidation of Holdings Act, 1947. 3. Whether a minor can be a purchaser at an auction sale.
Ratio Decidendi: 1. The court held that the omission to mention two wells in the proclamation of sale was not a material irregularity as the land was sold at an adequate price and no substantial loss was caused to the petitioners. 2. The court held that the auction sale did not contravene Section 31(a) of the Bombay Prevention of Fragmentation and Consolidation of Holdings Act, 1947, as a completed transfer of the land had not yet taken place. 3. The court held that a minor cannot be a purchaser at an auction sale as a minor is incapable of entering into a valid agreement and cannot incur the liabilities and obligations of an auction purchaser.
Final Decision: The court quashed the impugned orders of the Deputy Collector, the Collector, and the Commissioner and set aside the auction sale.

JUDGMENT - Tarkunde, J.

1. The petitioners claim to be the owners of a land, Gat No. 129, admeasuring 28 acres situate at village Jalochi near Baramati in the Poona District. In execution of an award which had been passed against the first petitioner in favour of a co-operative Society, this land was put up for sale under the provisions of the Bombay Land Revenue Code. The auction sale was held on 26th February 1965. The first respondent, who was then a minor, gave the highest bid for Rs. 15,100 and this bid was accepted by the officer conducting the sale. The petitioners applied within the prescribed time to the Deputy Collector under S. 178 of the Bombay Land Revenue Code for setting aside the sale. The application was rejected by the Deputy Collector. An appeal taken by the petitioners to the Collector and a further appeal taken by them to the Commissioner were dismissed. The petitioners have now approached this Court under Article 227 of the Constitution to challenge the legality of the decision of the Deputy Collector, the Collector and the Commissioner and to have the sale set aside.

2. One of the grounds on which the sale was sought to be set aside by the petitioners was that the proclamation of sale omitted to mention that there were two wells by which the land was irrigated. The Commissioner has observed in his judgment that the omission to mention that there were two wells in the proclamation was not a material irregularity, and Mr. Bhasme who appears on behalf of the petitioners argued that this view of the Commissioner was wrong. It appears to us that if the two wells in the land were capable of irrigating the land or a substantial part thereof, the omission of the two wells from the description of the land in the proclamation amounted to a material irregularity. The Commissioner, however, has further held that the land was sold at the auction for an adequate price and that no substantial loss was caused to the petitioners. Mr. Bhasme has challenged this finding of the Commissioner, but Mr. Bhasme could not show that this finding was vitiated by any error of law. The sale, therefore, cannot be set aside on the ground of the said irregularity.

3. Another ground on which the sale was challenged before the Commissioner was that it was held in contravention of Section 31 of the Bombay Prevention of Fragmentation and Consolidation of Holdings Act, 1947. Mr. Bhasme drew our attention to clause (a) of section 31 of the said Act which provides that, notwithstanding anything contained in any law for the time being in force, no holding allotted under this Act, nor any part thereof, shall be transferred, whether by way of sale (including sale in execution of a decree of a Civil Court or for recovery of arrears of land revenue or for sums recoverable as arrears of land revenue) or by way of gift, exchange, or lease, or otherwise, except in accordance with such conditions that the auction sale was in contravention of this provision, the Commissioner observed that the sale can be regularised by payment of penalty under Section 31AA of the said Act. The Commissioner, therefore, directed that the Collector should take steps to recover penalty of Rs. 100 under S. 31AA of the said Act. Now, S. 31AA provides, inter alia, that the transfers of any land in contravention of the provisions of this Act made before the 15th day of November 1965 shall not be deemed void merely on the ground of the contravention of any of the provisions of this Act, if the person "in possession of the land at the aforesaid date" by virtue of any transfers or purported transfers pays to the State Government within the prescribed period a penalty equal to one per cent of the consideration of the land transferred, or Rs. 100 whichever is less. Mr. Bhasme argued that the auction sale in the present case cannot be regularised under S.31AA because the first respondent has not yet been put in possession of the land and he is, therefore, not a person "in possession o

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