The confirmed bid in a public auction creates a concluded contract, and the bidder is obligated to fulfill the contractual obligations, including executing the lease agreement and paying the kist.

G.M. AKBAR ALI, J.,

1. The writ appeal arises out of the order passed by the learned single Judge in W.P.No.4834 of 1995 dated 14.8.2001. The appellant was the highest bidder for the running of an Arrack Shop No:4 at Bahour Commune Panchayat, (Arachikuppam), Pondicherry for the period from 15.9.94 to 30.6.95. He was given the right of retail vending of arrack for a monthly kist of Rs.1,20,100/-for the lease year of 1994-95 and the guaranteed quota was 364 litres of arrack per day. The confirmation order was issued on 15.9.94. He had deposited a sum of Rs.3,60,300/-. Against the guaranteed arrack, he had lifted only 3400 litres of arrack from the Pondicherry Distilleries Ltd. He did not pay the kist for the month of September, October and November 1994. Moreover, he has not executed an agreement of lease as contemplated under the Pondicherry Excise Rules. Therefore, a show cause notice was issued on 11.11.94 calling upon him to pay the lease amount and execute the lease agreement.

2. On 6.2.1995, the Deputy Commissioner (Excise), Government of Pondicherry issued a notice under sub-rule(2) of Rule 201 of the Pondicherry Excise Rules, 1970 to show cause as to why the licence granted to the appellant should not be cancelled and the deposit be forfeited and the shop to be re-auctioned.

3. The appellant sent a reply dated 18.2.1995 stating that he was not issued with a licence and he has also not executed a lease agreement and therefore, there is no question of cancelling the lease agreement. He has also contended that he was not allowed to run the arrack shop by the public and therefore, he requested for the refund of security deposit. He sent a reminder on 11.3.1995. However, on 21.3.1995, the Deputy Commissioner (Excise) -cum-Under Secretary (Excise), Pondicherry passed an order cancelling the right of lease and also forfeited the security deposit of Rs.3,60,300/-. Aggrieved by which, the appellant approached this Court by way of Writ of Certiorarified Mandamus to quash the order passed by the respondent and also for a direction to refund the security deposit.

4. The Government of Pondicherry filed a counter stating that the appellant is the highest bidder whose bid was confirmed and pursuant to which he had also deposited a sum of Rs.3,60,300/- and had also lifted 3400 litres as on 10.2.1995 and another 3400 litres of arrack as on 21.3.95 against the guaranteed quota of 54,257 litres and 68,808 litres respectively.

5. It was further contended that on enquiry, it was found that the appellant himself has instigated the villagers to raise objection to divert the issue and without lifting the Government quota he has been selling illicit arrack.

6. The learned single Judge by his Order dated 14.8.2001 found that the appellant had participated in the auction and his bid was confirmed on 15.9.94. It is further held that he had admitted that he will lift the guaranteed quota and pay the kist to run the shop and till 16.2.1995 the appellant had run the shop without any complaint. The learned single Judge had also referred to Rule 201 of Pondicherry Excise Rules and upheld the order passed by the Deputy Commissioner (Excise). Against which, the present appeal has been filed.

7. Mr.S.K. Rakhunathan, learned counsel for the appellant would submit that the appellant took part in an earlier auction dated 3.8.1994 and offered a highest bid of Rs.95,000/- but the Government of Pondicherry rejected the offer as the bid amount was not reasonable. The learned counsel further contended that in the subsequent auction, the appellant offered the bid of monthly kist of Rs.1,20,100/- which ought to have been confirmed and the necessary G.O ought to have been published by the Under Secretary (Excise), Government of Pondicherry. According to the learned counsel, the confirmation order given by the Deputy Commissioner (Excise) dated 15.9.1994 is not a licence for the appellant to run the arrack shop. The learned counsel pointed out that the