The main legal point established in the judgment is the importance of strict compliance with auction terms and conditions, balanced with the consideration of communications and extensions provided by the auctioning authority.

JUDGMENT

Vibhu Bakhru, J. Delhi Development Authority (hereafter `DDA') has filed the present appeal impugning a judgement dated 19.07.2022 (hereafter `the impugned judgment') passed by the learned Single Judge whereby the action of DDA in cancelling the sale of the industrial property (Plot No.86, Block-C, admeasuring 100 sq. mtrs. situated in Mangolpur Industrial Area, Phase-I, hereafter `the property') was set aside. DDA contends that the respondents have not complied with the terms and conditions of the auction and therefore, the Earnest Money Deposit (EMD) paid by the respondents is required to be forfeited.

2. DDA assails the impugned judgment, essentially, on two grounds. First, that the learned Single Judge had disregarded the terms of the auction; and second, that the learned Single Judge had referred to the decision of the Supreme Court in R.K. Saxena v. Delhi Development Authority, (2001) 4 SCC 137, which is inapplicable to the facts of the present case.

2.1. The controversy in this appeal arises in the context of the terms and conditions of the notice inviting tender for sale of the property issued by DDA on 27.09.2020. The terms and conditions of the auction as set out in the said notice, required the prospective bidders to deposit 5% of the bid amount before participating in the e-auction; 20% of the bid amount within seven days from the issuance of the Letter of Intent (hereafter `the LOI') by the competent authority accepting the bid; and the balance 75% of the bid amount within a period of 90 days from the issuance of the demand letter. Clause 9 and 10 in Chapter II of the terms and conditions as set out in the LOI are relevant and the same are set out below:

"9. The demand-cum-allotment letter would be issued to the successful bidder through the BHOOMI Portal after receipt of second stage EMD payment and other requisite documents and verification of second stage EMD. The highest bidder is required to make payment of balance 75% bid amount, as demanded vide said demand letter referred to above, within 90 days from date of issuance of demand letter (without interest/within 270 days from the date of issuance of demand letter (subject to payment of interest on the balance amount @ 10.00% p.a. during the extended period) through payment tab provided in BHOOMI Portal failing which the bid will automatically stand cancelled without any further notice. No extension of time will be granted for payment of 75% of bid amount for period after 270 days from the date of issuance of demand-cum-allotment letter.

Note: The successful bidder may pay the cost of the plot by availing loan facility from financial institutions for which the DDA offer NOC/mortgage permission.

10. In case, the highest bidder fails to deposit the balance 75% amount within the stipulated period, as mentioned in the demand letter, the bid shall automatically stand cancelled and the Earnest Money shall stand forfeited without any further notice. In that eventuality, the Competent Authority shall be competent to re-auction the Industrial plot."

3. In the present case, the respondents complied with the condition of depositing 5% of the bid amount at the time of obtaining the bid documents. They also deposited the balance 25% on 23.11.2020 which was within the stipulated period. Thus, undisputedly, the condition of deposit of the EMD was duly satisfied.

4. On 10.03.2021, DDA issued a letter informing the respondents that the balance amount of Rs.1,35,84,100/- (Rupees One Crore Thirty five Lakhs Eighty four Thousand and One Hundred only) was due and payable by the respondents. The said letter also indicated the time frame as stipulated on the "back side of the letter", which has been reproduced in the impugned judgment. The tabular statement indicating the time frame for making payments and further conditions are set out below: