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2025 Supreme(HP) 76
IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA.
G.S. SANDHAWALIA, C.J., RANJAN SHARMA, J.
Shashi Gupta – Appellant
Versus
State of H.P & Others - Respondents
LPA No. 251 of 2023
Decided on : 01-05-2025
Advocate Appeared:
For the Appellant : Appellant-Ms. Shashi Gupta in person (through Video Conferencing).
For the Amicus :Mr. G.D. Verma, Senior Advocate with Mr. Sumit Sharma, Advocate,
For the Respondents:Mr. Gobind Korla, Additional Advocate General
IMPORTANT POINT
Bona fide auction purchasers are exempt from the restrictions of Section 118 of the Himachal Pradesh Tenancy and Land Reforms Act, allowing them to sell property without prior permission.
Headnote:
(A) Himachal Pradesh Tenancy and Land Reforms Act, 1972 - Section 118 - Appeal against non-grant of relief in a writ petition regarding sale of residential property - The appellant, a successful auction purchaser, sought exemption from Section 118 for selling property to third parties/Himachalis - The learned Single Judge ruled that auction purchasers are not subject to Section 118's restrictions, as no conditions were stated in the auction notice - The court emphasized the need to protect bona fide auction purchasers from undue restrictions. (Paras 3 , 9 , 10 , 12 )
(B) Auction Purchaser Rights - The court held that a bona fide auction purchaser is entitled to sell property without needing prior permission under Section 118, as the auction process did not stipulate such a requirement - The court reaffirmed that the purpose of Section 118 is to protect local landowners from external buyers. (Paras 9 , 10 , 11 )
Facts of the case:
The appellant successfully bid for residential property in an auction but was denied a sale certificate due to Section 118's applicability, which restricts land transfers to non-agriculturists. The learned Single Judge ruled in favor of the appellant, leading to the current appeal regarding the non-consideration of a specific relief. (Paras 1 , 2 , 4 )
Findings of Court:
The court found that the auction purchaser is the absolute owner of the property and is entitled to sell it to a bona fide Himachali without needing prior permission under Section 118. (Paras 10 , 11 , 12 )
Issues: The main issue was whether the auction purchaser required permission under Section 118 to sell the property to a Himachali. (Paras 3 , 10 )
Ratio Decidendi: The court concluded that the restrictions of Section 118 do not apply to bona fide auction purchasers, as the auction notice did not impose such conditions, and emphasized the need to protect the interests of such purchasers. (Paras 9 , 10 , 11 )
Result: Appeal allowed, and the appellant is permitted to sell the property without prior permission under Section 118.
JUDGMENT :
G.S. Sandhawalia, Chief Justice
The present appellant is aggrieved against non-grant of the third relief by the learned Single Judge, who allowed CWP No.7090 of 2023 in her favour on 04.12.2023. The non-grant of said relief, which is sought to be assailed, reads as under:-
“(iii) That directing the respondents to exempt the petitioner from applicability of Section 118 for thepurpose of directly selling the residential property with land in question, in favour of third parties/Himachalis OR in the alternative to above.”
2. The learned Single Judge while allowing the writ petition noticed that the present appellant was a successful auction purchaser of 260 sq. metres of residential property situated in Mauza Thoddo, Tehsil and District Solan, H.P. in a public auction conducted by the Assistant Collector, First Grade-cum-Tehsildar, Solan, District Solan, H.P. under Section 421 of the Code of Criminal Procedure and had duly deposited the sale amount on 11.07.2023. However, the sale certificate has not been issued to her in view of the applicability of Section 118 of the Himachal Pradesh Tenancy and Land Reforms Act, 1972 (for short “the Act”) due to which the writ petition has been filed, praying that the sale certificate be issued without insisting for affixation of stamp duty and also without the necessary permission under Section 118 of the Act.
3. While placing reliance upon the judgment of the Division Bench in CWP No.1689 of 2016 titled as Valley Iron & Steel Company Ltd. Vs. State of H.P. and Ors. decided on 20.10.2016 reported in Latest HLJ 2016 (HP) 1528, the learned Single Judge came to the conclusion that an auction purchaser is not required to go through the rigorous of Section 118 of the Act. The matter as such being covered and keeping in view the fact that there is no rider mentioned in the auction notice regarding the necessary permission under Section 118 of the Act and the denial of the sale certificate, on this account was held to be not sustainable. Resultantly, the writ petition was allowed by giving the following relief:-
“As this Court is of the considered view that in the absence of there being any condition in the auction notice that a non-agriculturist or a non-Himachali could not bid for the property in issue and further as the petitioner admittedly was a successful bidder in the auction who has thereafter deposited the entire bid amount in the Court itself, denial of Sale Certificate in favour of the petitioner is per se bad. Therefore, this writ petition is allowed by holding the act of the respondents of denying the Sale Certificate to the petitioner to be bad in law and direction is issued to respondent No.2 to issue a Sale Certificate of the property in issue in favour of the petitioner, forthwith and in any event, within a period of 30 days from today. Petition stands disposed of, so also pending miscellaneous applications, if any.”
4. As noticed above, the contention of the appellant is that the third prayer as such was never considered, therefore, the present appeal has been filed. Inspite of the fact that the said judgment was in favour of the appellant, the State has chosen not to assail it.
5. Since, the necessary sale certificate was not being issued and show cause notice was thus issued by this Court on 19.06.2024 to the District Collector, Solan, H.P., as in the sale certificate the statement had been recorded that permission would be required under provisions of Section 118 of the Act.
6. Vide order dated 23.07.2024, directions were issued that the sale certificate should be handed over to the appellant by the Additional Deputy Commissioner, Solan, District Solan, H.P. The matter was then kept for hearing on the limited issue of Relief (iii). Vide order dated 10.03.2025, we also requested Mr. G.D. Verma, Senior Counsel to assist the Court on the said issue. The counsel for the State was also insisting that necessary permission would be required inspite of the sale certificate having been
