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PUNJAB & HARYANA HIGH COURT
Gurdev Singh, J.
Harkishan Singh
Versus
State Of Punjab
Civil Writ No. 2042 of 1965,
Decided On : MARCH 30, 1967
AUCTION SALE - EVACUEE PROPERTY - DISPLACED PERSONS (COMPENSATION & REHABILITATION) RULES, 1955 - RULES 90, 92 - SALE SET ASIDE - GROUNDS - MATERIAL IRREGULARITY OR FRAUD IN PUBLICATION OR CONDUCT OF SALE - SUBSTANTIAL INJURY TO APPLICANT - FINDING OF FACT NECESSARY.
Fact of the Case:
A taur, measuring 8 marlas, was sold in an auction conducted by the Naib Tehsildar (Sale)-cum-Managing Officer. The petitioner, Harkishan Singh, was the highest bidder and the property was knocked down in his favor for Rs. 160/-. The next day, Ved Parkash, a local resident, applied to the Naib Tehsildar, stating that he was prepared to offer Rs. 320/- for the taur and that the sale in favor of Harkishan Singh be canceled. The Tehsildar (Sales) dismissed the application, finding no fraud or irregularity in the publication or conduct of the sale. Ved Parkash appealed to the Settlement Officer (Sales), who set aside the sale, finding that proper publicity was not done and that Ved Parkash had offered a first bid of Rs. 1,000/- at the time of the fresh auction. The Chief Settlement Commissioner affirmed the order of the Settlement Officer.
Finding of the Court:
The court held that the impugned orders of the Settlement Officer and the Chief Settlement Commissioner were illegal and in excess of their powers. The court found that there was no finding that any substantial injury had resulted to Ved Parkash, who had moved for setting aside the sale. The court also found that Ved Parkash had never alleged that there was any fraud or irregularity in the publication or the conduct of the sale. The court further found that the Settlement Officer and the Chief Settlement Commissioner had not recorded a specific finding that there had been any fraud or irregularity in the publication or conduct of the sale.
Issues: 1. Whether the sale of the taur could be set aside on the grounds of material irregularity or fraud in the publication or conduct of the sale, and substantial injury to the applicant? 2. Whether the Settlement Officer and the Chief Settlement Commissioner had the authority to set aside the sale without a finding of fact that the publication and the conduct of the sale suffered from any illegality or irregularity or vitiated by fraud?
Ratio Decidendi: The court held that a sale of evacuee property made in accordance with Rule 90 of the Displaced Persons (Compensation & Rehabilitation) Rules 1955 can be set aside only in accordance with the procedure laid down in Rule 92. Under Rule 92(1), an application for setting aside the sale can be made only on the ground of irregularity or fraud in the conduct of the sale. The court further held that the sale can be set aside at the instance of a private party only if it is alleged and proved that material irregularity or fraud had been committed in the publication or conduct of the sale, and because of such irregularity and fraud the person applying for setting aside the sale has sustained substantial injury. The court also held that the substantial injury must be one occasioned by material irregularity or fraud in publication or conduct of the sale.
Final Decision: The court accepted the petition and quashed the impugned orders of the Chief Settlement Commissioner and the Settlement Officer. The court directed that the necessary writ shall issue and that the petitioner will have his costs against the contesting respondents.
Gurdev Singh, J.
1. This dispute in this petition under Article 226 of the Constitution relates to evacuee property situate in Totamazia, district Hoshiarpur, which was originally described as house No. 4 but in the course of time had got reduced to a taur measuring 8 marlas. This taur, the reserve price of which was fixed by the Rehabilitation authorities at rs. 96/- was put up for auction on 13th MAy, 1964. The auction was conducted by the Naib Tehsildar (Sale)-cum-Managing Officer, when the property was knocked down in favour of the petitioner Harkishan Singh, being the highest bidder for Rs. 160/-. The very next day the petitioner deposited the entire sale price.
2. Twelve days later, on 25th May, 1964, Ved Parkash a local resident, made an application to the Naib Tehsildar stating that he was prepared to offer Rs. 320/- for this taur and the same be sold o him cancelling the earlier sale in favour of the petitioner Harkishan Singh. In this application there was no allegation that there was any defect, fraud or irregularity in publication or conduct of the sale. Ved Parkash wanted the cancellation of the previous sale solely on the plea that because of his absence from the station he could not attend the auction or bid for the property. The Tehsildar (Sales) thereupon held an enquiry, and after hearing Ved Parkash and the present petitioner found that there being no fraud or irregularity in publication of the sale, there was no justification for cancelling the sale made in favour of Harkishan Singh. In dismissing the application of Ved Parkash, he further observed that his objections to the sale could not be entertained being barred by time. Against the order of the Tehsildar (annexure A), dated 2nd July, 1964, Ved Parkash preferred an appeal to the Settlement Officer (Sales). Before this Appellate Authority Ved Parkash made a substantial improvement in his case contending that because of lack of proper publicity of the auction he was prevented from bidding for the taur in dispute, which was adjacent to his house. At the same time, he increased his original offer of Rs. 320/- to Rs. 1,000/- for the taur in dispute. The Settlement Officer (Sales) appears to have been greatly impressed by this offer, and accepting the appeal of Ved Parkash set aside the sale. The material part of his order annexure B, dated 30th November, 1964, is in these words :-
"My feeling is that publicity was not done in a proper manner. Had this been done, the appellant whose house is quite adjacent to the plot in dispute must have come to know He has offered the first bid of Rs. 1,000/- which is six times more than the highest bid offered by the respondent. From t his it is clear that the plot was sold without proper competition and proclamation. Accordingly, I accept the appeal, set aside the order of the Tahsildar (Sales)-cum-Managing- Officer and order that the property should be put to auction again after due publicity and proclamation."
3. Against this order Harkishan Singh then went up in revision, but without success. The Chief Settlement Commissioner a firmed the order of the Settlement Officer, observing as under :-
"After hearing the arguments. I find no justification to interfere with the finding of fact given by the appellate Court. Apart from that, the sale by auction in favour of the petitioner has not been confirmed so far. It was subject to confirmation by the Settlement Commissioner. The appellate Court exercised the powers of Settlement Commissioner. By accepting the appeal of the respondent, the appellate Court as Settlement Commissioner has declined to approve the sale under Rule 90(x) in favour of the petitioner. The appellate Court was perfectly justified in doing so when the respondent has come forward and had offered to give the first bid at the time of fresh auction of Rs. 1000/-."
4. It is against this order of the Chief Settlement Commissioner, dated 7th June, 1965, confirming the appellate order, dated 13th Novembe
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