JUDGMENT

(Prayer: Writ Petition is filed Under Article 226 of the Constitution of India to issue a Writ of Certiorarified Mandamus, calling for the records of the respondent in Na.Ka.No.462/2023/A2 dated 30.06.2023 and quash the same and further direct the respondent to confirm the auction bids dated 16.05.2023 in favour of the petitioners on receipt of the auction amounts.:

1. The present writ petition has been filed by the petitioners challenging the order passed by the respondent cancelling the auction sale conducted on 16.05.2023 on administrative grounds.

2. The respondent conducted public auction on 16.05.2023 for lease of shops belongs to the Respondent/Panchayat Union. The petitioners are the highest bidders in the said auction. It is stated by the petitioners that nine of the petitioners have already paid the entire bid amount. In the affidavit filed in support of the writ petition, it is stated by the petitioners that though the other petitioners tendered the remaining amount by way of Demand Draft and the same has been refused by the respondent. Subsequently, the impugned order cancelling the auction held on 16.05.2023 came to be passed.

3. The learned counsel appearing for the petitioners by taking this Court to Rule 18 of the Tamil Nadu Panchayats (Procedure For Conducting Public Auction of Leases and Sales in Panchayats) Rules, 2001, submitted that the re-auction can be conducted only on four contingencies mentioned in the said rules. In the case on hand, none of the said contingencies are satisfied. Therefore, the order passed by the Commissioner cancelling the auction that held on 16.05.2023 is without jurisdiction.

4. The learned Additional Government Pleader appearing for the respondent submitted that the earlier occupants of the shops had formed a syndicate and attended the auction through their men offered lesser lease rent. Therefore, the highest bid in the earlier auction conducted on 16.05.2023 did not reach the expected mark. Therefore, the respondent by impugned order cancelled the auction held on 16.05.2023 and the said decision was taken in the interest of the respondent Union.

5. Rule 18 of the Tamil Nadu Panchayats (Procedure For Conducting Public Auction of Leases and Sales in Panchayats) Rules, 2001, reads as follows:-

“18. Circumstances and procedure to conduct re-auction.- (1) Re-auction of lease may be conducted in the following circumstances: -

(a) When the lease was cancelled due to violation of lease condition by the lessee;

(b) When another person comes forward to bid for higher amount by remitting an amount higher, by one and a half times more than the bid amount;

(c) When the Inspector or any other authority empowered by him cancel the auction on account of proven irregularities committed in the auction held already; and

(d) When the Panchayat itself resolves to conduct re-auction on the ground that the bid amount is too low to be considered as a reasonable bid, compared to the last auction or taking into consideration of the prevailing circumstances.

(2) In the event of re-auction, the procedure laid down for conducting auction in these rules shall be observed all over again, starting from the issue of re-auction notice onwards. Before commencing re-auction proceedings, a written order cancelling the previous auction, shall be issued by the Executive Authority or the Commissioner or the Secretary, as the case may be, based on the resolution of the Panchayat or the orders of the Inspector.

(3) The Executive Authority or the Commissioner or the Secretary, as the case may be, shall be competent to cancel an auction in the event of a situation specified in clause (b) in sub-rule (1) and issue orders before seeking permission of the Panchayat for conducting a re-auction.

(4) When re-auction is ordered, the publication of a notice in the District Gazette and the newspapers may be dispensed with i