The acceptance of a bid in an auction sale is conditional if it is subject to the approval of a third party. Until such approval, there is no concluded contract between the bidder and the seller.

A.B.N.Sinha, J.

1. This appeal by the plaintiff is directed against the judgment and decree passed by the lower appellate Court dismissing his suit for recovery of Rs. 1140.00, representing an initial deposit made under indemnity bond upon an auction sale of certain properties situate within Ranchi Municipality on the 22nd August 1958.

2. The relevant facts are no longer in dispute. Parts of Municipal holding Nos. 586 and 587 of ward No. V of Ranchi Municipality, which had been declared evacuee property in accordance with law and had come to vest in the Custodian of Evacuee Properties, Bihar (defendant No 2), and of which defendant No. 3, the Managing Officer-cum Assistant Custodian, Gaya. was in charge were advertised for sale in accordance with the procedure in that behalf laid down in Chapter XIV of the Displaced Persons (Compensation & Rehabilitation) Rules, 1955 (hereinafter referred to as the Rules). The auction sale was held on the 22nd August, 1958 by the Managing officer-cum-Assistant Custodian, Gaya (defendant No. 3) through an auctioneer, defendant No. 4, and the plaintiff-appellant was declared the highest bidder, his bid being Rs. 11,400/-; and, as permitted by the aforesaid rules under which the auction had been held, the plaintiff executed an indemnity bond (Ext A) for Rs. 1140.00, that is, 10 per cent of the bid amount by way of an initial payment. Sub-Rule (10) of Rule 90 of the Rules read as under:

"The bid in respect, of which the initial deposit has been accepted or in respect of which an indemnity bond has been executed shall be subject to the approval of the Settlement Commissioner or an officer appointed by him for the purpose. Provided that no bid shall be approved until after the expiry of a period of seven days from the date of auction."

The officer appointed for the purpose of granting approval within the meaning of the above sub-rule, in the instant case, was defendant No. 3. On the 9th February, 1959. when nearly six months had elapsed from the date of the auction, and defendant No. 3 had neither signified his approval or rejection of the bid, the plaintiff served notices (Exts. 6 series) on defendants 3 and 4 revoking and withdrawing his bid and calling upon them to refund the amount representing the initial payment made by him as aforesaid; and, on their failure to refund the amount as claimed, the plaintiff after complying with the provisions of Section 80 of the Code of Civil Procedure instituted the suit out of which this appeal arises for recovery of the said amount of Rs. 1140.00 On the 1st May, 1960. during the pendency of the suit, defendant No. 3 signified his acceptance of the bid to the plaintiff (Exts. C and D) and required the plaintiff to deposit the further amount towards the auction purchase. On the plaintiffs failure to make the deposit, the amount deposited by him was forfeited and the auction sale held on the 22nd August, 1958 was cancelled. The property was thereafter resold and was purchased by a third party.

3. The suit was resisted mainly on the ground that the condition of approval of the bid by defendant No. 3 did not imply that there was no effective acceptance of the plaintiffs bid with the fall of the hammer. It was urged that in law there was an acceptance of the bid subject only to a condition subsequent and after the said acceptance, the plaintiff was not entitled to revoke the bid and withdraw his offer and claim refund of the initial deposit.

4. The trial court found in favour of the plaintiff and decreed the suit. On appeal by the defendants to the lower appellate court, the decision of the trial court has been reversed. The case of the plaintiff that at the auction an assurance was given to supply further description and particulars of the property was considered in the light of the evidence on the record and the lower appellate court has come to a clear finding that on the date of the sale the plaintiff did know all the particulars and descriptions neces