# Akhilesh Pathak v. State of U.P.and others

- **Citation:** (2011) 3 ILRA 1474
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2008-02-29
- **Case number:** Civil Misc. Writ Petition No. 54455 of 2010
- **Bench:** R.K. Agrawal, Surendra Kumar
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/akhilesh-pathak-v-state-of-u-p-and-others-42084
- **Pages:** 10

## Headnote

Constitution
of
India,
Article
226Principle of Natural Justice-auction sale
of Bolero Jeep-after having valuation
report
from
Transport
Authorityvaluation fixed as Rs. 75000/-petitioner
being highest bidder for Rs. 85000/-
deposited
15000/-1⁄4

amount
immediately-balance 3⁄4 amount of Rs.
70000/-deposited within time-acceptedsubsequent
on
political
pressurecancellation of auction proceeding and
direction for re-auction on ground of low
amount -behind the back of petitionersheld--illegal-perverse, unjust, arbitrary
3 All] Akhilesh Pathak V. State of U.P.and others
1475
and mala fide-direction to release vehicle
to petitioner issued.

Held Para 31

Thus, after getting the whole amount of
the bid received by the auctioning
authority till 21.7.2010, the auctioning
authority in a shocking and surprising
way
recommended
to
the
S.D.M./respondent no. 2 for re-auction
of the vehicle in question with some
ulterior motive just on the ground of
inadequacy
of
the
price.
If
any
inadequacy of price had been within the
knowledge of the auctioning authority at
the time of completion of the auction,
there would not have been any reason
for
him
to
submit
a
report
recommending
for
re-auction
subsequently with delay. On the basis of
the
said
report
of
the
auctioning
authority
dated
22.7.2010,
the
S.D.M./respondent no. 2 passed the
impugned order in one sentence to the
effect
that
"agreed,
the
auction
cancelled, the re-auction be made as per
the rules." This by can no stretch of
imagination be called a speaking or legal
order which was passed behind the back
of the petitioner. If for a moment the
point of some commotion during the
progress of auction was there, the same
did not find place in the relevant report
dated 22.7.2010 submitted to the S.D.M.
by which he recommended for reauction. The impugned order passed by
the respondents appears to be illegal,
perverse, unjust, arbitrary and malafide.
Case law discussed:
(1970) 3 SCR 1: (1969) 3 SCC 537; 1989 RD
page 51; 1970 (2) SCC page 405

(Deliverd by Hon'ble R.K. Agrawal, J.)

## Text

1474 INDIAN LAW REPORTS ALLAHABAD SERIES [2011
Of course, in case the Government feels
that arms licence are abused for oblique
motive
or
criminal
activities,
then
appropriate measures may be adopted to
check such mal-practice. But arms licence
should not be suspended in a routine
manner mechanically, without application
of mind and keeping in view the letter and
spirit of section 17 of the Arms Act."

19. The police has utterly failed to
bring any material on record to indicate
that except the unnamed F.I.R., on
account of which proceeding has been
initiated, there was anything against the
petitioner. Not even a single incident has
been cited in the show cause notice or in
the order of the District Magistrate. The
lodging of the F.I.R. or pendency of the
cases against the petitioner's brother, in
my considered opinion, should not have
been made basis for cancelling the firearm
licence of the petitioner.

20. After going through the reply of
the petitioner to the show cause notice, it
transpires that on account of two murders
in petitioner's family, for his personal
safety, the petitioner has applied for
firearm licence and he was granted the
same in the year 2000. There is no
allegation, except the present one, that the
petitioner has ever misused his firearm
licence or have ever committed any
crime. Merely by saying that a person has
entered into world of crime, cannot be
said to be sufficient for cancelling the
firearm licence of a person, which was
granted after due deliberations and due
inquiry and after verifying the credentials
of the petitioner. The apprehension cannot
be made basis for cancellation of the
firearm licence. The relevant section for
cancellation of firearm licence is very
unambiguous and clear in this regard.

21. In view of the foregoing
discussions and taking note of the dictum
of Division Bench of this Court, I am of
the considered opinion that the orders
impugned
dated
29.2.2008
and
25.10.2007 are unsustainable in the eye of
law and the same are being quashed. The
writ petition succeeds and is allowed. The
District Magistrate is directed to take
follow up action in accordance with law
by restoring the petitioner's firearm
licence.
---------
ORIGINAL JURISDICTION
CRIMINAL SIDE
DATED: ALLAHABAD 08.12.2011

BEFORE
THE HON'BLE R.K. AGRAWAL, J.
THE HON'BLE SURENDRA KUMAR, J.

Civil Misc. Writ Petition No. 54455 of 2010

Akhilesh Pathak

 ...Petitioner
Versus
State Of U.P. & others ...Respondents

Counsel for the Petitioner:
Sri Shyam Sunder Tripathi

Counsel for the Respondents:
C.S.C.

Constitution
of
India,
Article
226Principle of Natural Justice-auction sale
of Bolero Jeep-after having valuation
report
from
Transport
Authorityvaluation fixed as Rs. 75000/-petitioner
being highest bidder for Rs. 85000/-
deposited
15000/-1⁄4

amount
immediately-balance 3⁄4 amount of Rs.
70000/-deposited within time-acceptedsubsequent
on
political
pressurecancellation of auction proceeding and
direction for re-auction on ground of low
amount -behind the back of petitionersheld--illegal-perverse, unjust, arbitrary
3 All] Akhilesh Pathak V. State of U.P.and others
1475
and mala fide-direction to release vehicle
to petitioner issued.

Held Para 31

Thus, after getting the whole amount of
the bid received by the auctioning
authority till 21.7.2010, the auctioning
authority in a shocking and surprising
way
recommended
to
the
S.D.M./respondent no. 2 for re-auction
of the vehicle in question with some
ulterior motive just on the ground of
inadequacy
of
the
price.
If
any
inadequacy of price had been within the
knowledge of the auctioning authority at
the time of completion of the auction,
there would not have been any reason
for
him
to
submit
a
report
recommending
for
re-auction
subsequently with delay. On the basis of
the
said
report
of
the
auctioning
authority
dated
22.7.2010,
the
S.D.M./respondent no. 2 passed the
impugned order in one sentence to the
effect
that
"agreed,
the
auction
cancelled, the re-auction be made as per
the rules." This by can no stretch of
imagination be called a speaking or legal
order which was passed behind the back
of the petitioner. If for a moment the
point of some commotion during the
progress of auction was there, the same
did not find place in the relevant report
dated 22.7.2010 submitted to the S.D.M.
by which he recommended for reauction. The impugned order passed by
the respondents appears to be illegal,
perverse, unjust, arbitrary and malafide.
Case law discussed:
(1970) 3 SCR 1: (1969) 3 SCC 537; 1989 RD
page 51; 1970 (2) SCC page 405

(Deliverd by Hon'ble R.K. Agrawal, J.)

1. Heard learned counsel for the
parties.

2. This writ petition has been
preferred by the petitioner to issue a writ,
order or direction in the nature of
certiorari quashing the impugned order
dated 22.7.2010 passed by the respondent
no.2/
Sub
Divisional
Magistrate,
Nizamabad, Azamgarh, (Annexure No.1
to the writ petition) and also for a
direction in the nature of mandamus
directing the respondent nos.2 and 3
namely Sub Divisional Magistrate and
Tehsildar/Auction Incharge, Nizamabad,
Azamgarh, to issue a release order for the
auctioned Bolero Jeep 2003 Model
(Chassis No.MA-1XA2 ACB) in favour
of the petitioner ensuring release of the
vehicle in question from Police Station
Gambhirpur, Azamgarh.

3. The respondent no.2 vide the
impugned order dated 22.7.2010 had
cancelled the auction dated 19.7.2010 and
ordered for re-auction of the vehicle in
question on the ground that the re-auction
will bring more revenue to the State.

4. The facts giving rise to the
present writ petition are that the certain
vehicles including vehicle in question
unclaimed by their owners were seized by
Station House Officer, Police Station
Gambhirpur, Tehsil Nizamabad, District
Azamgarh.
As
the
seized
vehicles
remained unclaimed by their owners for a
considerable long time, the vehicles were
likely to go defunct for non-use and
maintenance
and
their
value
got
diminished, the Administration thought it
proper to put them to public auction.
Before
the
auction,
the
Regional
Transport
Officer,
Azamgarh,
was
requested vide letter dated 22.5.2010 by
Police Station Gambhirpur for assessing
value of each vehicle. The Regional
Transport
Officer,
Azamgarh,
after
making physical scrutiny and assessment
of the vehicle piecewise submitted a
report showing approximated reasonable
1476 INDIAN LAW REPORTS ALLAHABAD SERIES [2011
value of the said vehicles. The value of
the vehicle in question was assessed at
Rs.75,000/-
(Rupees
seventy
five
thousand)
only.
Subsequently,
the
respondent no.2 authorized the respondent
no.3/Tehsildar Nizamabad to conduct the
public auction after due publication in the
local daily newspapers having wide
circulation in the area. The publication
relating to the auction in local newspapers
was made and common public interested
in the vehicle in question invited to
appear and bid for it in the public auction
to be held on 19.7.2010. In response to
the said advertisement, seven bidders
including the petitioner attended the
auction and made the bids. Before the bid
began,
a
notice
dated
19.7.2010
mentioning the terms and conditions of
the bid was put on the board which
stipulated inter-alia that each bidder shall
make the security deposit of Rs.5,000/-
before the bidding. The other terms and
conditions were that 1/4th of the amount
of final bid for the vehicle in question
shall be deposited immediately and
remaining 3/4th of the amount shall be
deposited within fifteen days from the
date of the aforesaid auction. It was also
stipulated that the release order was to be
issued only after the auction was accepted
by the respondent no.3. Accordingly, all
the seven persons made the security
deposit
of
Rs.5,000/-
(Rupees
five
thousand) each.

5. The auction bid continued for four
rounds and ultimate bid of the petitioner
to the tune of Rs.85,000/- (Rupees eighty
five thousand) was found final after
calling the bidders three times to go above
it which the bidders did not do. Thus, the
highest bid could not be crossed by
further bid of higher value. A copy of the
progress of the bid upto the highest
bidding of Rs.85,000/- (Rupees eighty
five thousand) made by the petitioner, has
been annexed as Annexure No.4 to the
writ petition.

6. As per the terms and conditions of
the auction sale, the petitioner deposited a
sum of Rs.25,000/- (Rupees twenty five
thousand) with the treasury vide receipt
dated 19.7.2010 on the day of the auction
itself. The petitioner made the deposit of
balance amount of auction bid i.e.
Rs.60,000/- (Rupees sixty thousand) vide
treasury receipt, accepted and issued by
the respondent no.3 on 21.7.2010. The
auction proceeding to the level of its
finality on the highest bid of the amount
of Rs.85,000/- (Rupees eighty five
thousand) made by the petitioner was
further explicit by the respondent no.3 in
accepting the total amount of Rs.85,000/-
(Rupees eighty five thousand) deposited
by the petitioner within time and accepted
through the receipts issued by the
respondent
no.3
on
19.7.2010
and
21.7.2010.

7. The respondent no. 3 namely
Tehsildar/Auction Incharge, Nizamabad,
Azamgarh submitted a report about the
details of the auction to the respondent no.
2 Up Zila Adhikari, Nizamabad on
22.7.2010 proposing re-auction of the
vehicle in question keeping in view the
condition of the vehicle in question that
the auction of the vehicle could bring
more revenue to the State after wide
publication through newspapers. The
respondent no. 2 by the impugned nonspeaking order dated 22.7.2010 agreed
with the said report and cancelled the
auction directing re-auction according to
the
rules
without
affording
any
opportunity of hearing to the petitioner.
3 All] Akhilesh Pathak V. State of U.P.and others
1477

8. After complying with the terms
and conditions of the auction and
depositing the entire amount of the
auction, the petitioner approached the
respondent no. 3 on 26.7.2010 for
issuance of the release order of the
vehicle in question so sold out to the
petitioner through above auction in order
to approach the police station incharge for
release of the aforesaid vehicle in
question. It was at that stage, respondent
no. 2 disclosed this fact to the petitioner
that the vehicle in question could not be
released as there was some political
pressure against it. The petitioner was
orally asked to surrender his claim for the
vehicle in question in the auction for
some other vehicle.

9. When the petitioner came to know
about the order dated 22.7.2010 passed by
respondent no. 2, he raised grievance
through
the
letter
to
the
District
Magistrate, Azamgarh on 26.7.2010, who
called for a report from the respondent
nos. 2 and 3 within three days. The
respondent no. 3 submitted a report to the
respondent no. 2 on 28.7.2010 wherein
the facts of auction proceedings, entire
deposit made by the petitioner as the
highest bidder and its acceptance by
respondent no. 3, was admitted. It was,
however, disclosed in the said report that
after acceptance of the entire bid amount
of auction, it was thought proper to re-put
the vehicle in question for fresh auction in
expectation of the higher amount as the
revenue likely to come. The report of
respondent
no.
3
dated
28.7.2010
submitted to the respondent no. 2 has
been annexed as Annexure No. 8 to the
writ petition.

10.

The
respondent
no.
2,
accordingly, informed to the Additional
District Magistrate (F & R), Azamgarh
that since the report/recommendation for
re-auction had been made, the release
order could not be issued. In the
information dated 29.7.2010 made by the
respondent no. 2, finality of auction at the
highest bid of Rs. 85,000/- (Rupees eighty
five thousand), receipt of the total amount
of auction deposited by the petitioner was
also accepted.

11. The petitioner sought an
information
under
the
Right
to
Information Act by sending a letter dated
28.7.2010 in this matter. The petitioner
was furnished the relevant information to
the effect that the highest bid of the
auction of the said vehicle was to the tune
of Rs. 85,000/- (Rupees eighty five
thousand) and the highest bidder was the
present petitioner Akhilesh Pathak. The
auction was cancelled as it did not fetch
the sufficient revenue and the amount of
bidding was insufficient.

12. It has been averred in the writ
petition that no auction after public
advertisement having culminated in the
highest bid accepted by the auctioning
authority coupled with the deposit of
entire auction amount accepted by the
authority could be cancelled without their
being any breach of the terms of the
auction or element of fraud in the auction
so conducted. Since after auction of the
vehicle in question having reached the
stage of deposit so accepted and receipt
issued
by
the
auction
authority/
respondent no. 3, the auction could not be
cancelled. The only stage thereafter was
to issue an order for release of the vehicle
in question. No auction so culminated
without breach or fraud could be
cancelled and that too without opportunity
of hearing to the petitioner, who had
1478 INDIAN LAW REPORTS ALLAHABAD SERIES [2011
completed
his
part
as
bidder
and
deposited the entire amount which was
accepted by the respondents.

13. According to the petitioner, the
impugned order by which the auction of
the vehicle in question was cancelled, is
arbitrary as passed behind back of the
petitioner
for
unwarranted
political
pressure and with ulterior motive to
oblige the agency behind the picture. The
impugned order is violative of the
principle of audi-alteram partem and also
violative of the right of the petitioner
under Article 300A of the Constitution of
India.

14. Sri Chhedi Lal Singh, Tehsildar
Nizamabad, Azamgarh filed his counter
affidavit on behalf of the respondents
deposing that the impugned order dated
22.7.2010 was passed by the competent
authority i.e. Sub Divisional Magistrate,
who after considering the facts that the
auction bidder has tried to get the vehicle
on a very low price which would have
resulted in loss of revenue to the State,
had rightly cancelled the auction directing
afresh auction. The vehicle in question
was in a good condition and could bring a
better revenue for the State. After
considering the condition of the vehicle
and bid amount, the re-auction of the said
vehicle
was recommended
and
the
competent authority agreeing with the
recommendation cancelled the auction
held on 19.7.2010 and directed for reauction of the vehicle by the impugned
order.

15. It has been averred through the
counter
affidavit
that
the
Regional
Transport Officer, Azamgarh assessed the
value
of
the
vehicle
in
question
tentatively. According to the respondents,
the date of auction could not be properly
published, only seven persons participated
in the bid and only upto fourth round, the
bidders signed the bid papers but in the
sixth final round of auction, no one signed
on the papers due to commotion. It is
obligatory that all the papers must be
signed by all the bidders relating to the
bid. The respondent no. 3/Tehsildar was
only supposed to submit a report of the
auction and it was only respondent no.
2/S.D.M. who had power to accept the
auction bid.

16. It has been further alleged that
mere deposit of the money does not mean
acceptance of the bid and there was no
stipulation for the said auction that the
deposit of money meant for acceptance of
the bid, the auctioned property can only
be released in favour of the highest bidder
when the auction is accepted by the
competent
authority.
The
repeated
grounds of the respondents for cancelling
the said auction are that since the
petitioner intended to get the vehicle in
question at a very low price by all means
and it brought a very low revenue for the
State as the vehicle in question was in
good condition and could fetch better
revenue for the State, the said auction was
cancelled and re-auction was directed
keeping in view the interest of the State.
The petitioner was advised to take his
money back and the delay in taking the
auction deposited money back would be
at his own cost. In the counter affidavit,
malafides and arbitrariness in passing the
impugned order has been denied.

17. The petitioner by way of filing
rejoinder affidavit repeated the averments
made in the writ petition calling the
auction in dispute as practical and logical
on the ground that the vehicle in question
3 All] Akhilesh Pathak V. State of U.P.and others
1479
deemed to be defunct due to non use since
long. Since report of the Regional
Transport Officer was found reliable as
the basis for the proposed auction, the
process of auction was resorted to. It has
been further submitted that failure to
obtain signature on the last page of the
bidding of the above Bolero Jeep if any
can be said to be failure of the auctioning
authority, the auction could not be
affected. It was mere irregularity once the
auction
in-charge
confirming
and
approving the last and final bid by the
petitioner closed the auction as complete
and immediately accepting the deposit of
1/4th and more of the highest bid of the
auction. Since 3⁄4th of the balance amount
of bidding was deposited by the petitioner
well within time and the same was
accepted
by
the
auctioning
authority/respondent no. 3 without any
objection, the auction could not be legally
cancelled just on the frivolous ground that
the said auction fetched less revenue to
the State. It has also been submitted that
the respondent no. 3 had occasion before
the auction dated 19.7.2010 to postpone,
adjourn or cancel the auction proceedings
if there was no proper circulation or
publication in the area.

18. The learned counsel for the
petitioner has further submitted that the
respondents may postpone, adjourn or
cancel the auction proceedings on the
following stages;

(a) When the R.T.O. had submitted
his valuation report on 28.6.2010;

(b) When the bidders were present on
19.7.2010, they were found to be
insufficient in number;

(c) When the last bid of Rs. 85,000/-
was made by the petitioner and before the
auction could be closed as completed or at
the most on 22.7.2010 when the last
deposit of 3/4th amount was made by the
petitioner and the same was accepted
through receipt by the respondent no. 3.
There was no occasion in law for the
respondents to cancel the said auction.
The auction was cancelled to deny the
petitioner of his accrued right to the
legitimate claim for release of the vehicle
in question. The purpose was to oblige
non bidder because of political influence
and thereby denied the petitioner of his
legitimate right to claim for release of the
vehicle.

19. In this writ petition, following
points are involved;

(i) Whether after the hammer had
been knocked down at the highest bid in a
public auction and 1⁄4 of the bid amount
deposited
by
the
highest
bidder
immediately after the bid and duly
accepted, could an auction be cancelled ?

(ii) Whether any order cancelling
such an auction behind the back of the
highest bidder depositing the entire or
1/4th amount of the highest bid could be
passed ?

(iii) Whether such an order could be
treated to be fair, impartial or legal and
without charge of arbitrariness and mala
fides ?

(iv) Whether a sale by public auction
could be considered on a footing better
than ordinary sale in the market ?

20. We have gone through the
decision relied upon by the learned
1480 INDIAN LAW REPORTS ALLAHABAD SERIES [2011
counsel for the petitioner in the case of
M/s Kayjay Industries (P) Ltd. Vs. M/s
Asnew Drums (P) Ltd and others (1974) 2
SCC page 213, wherein Hon'ble Apex
Court observed that a Court sale is a
forced sale and notwithstanding the
competitive element of a public auction,
the best price is not often forthcoming.
The Judge must make a certain margin for
this factor. A valuer's report, good as a
basis, is not as good as an actual offer and
variation within limits between such an
estimate, however careful, and real bids
by seasoned businessman before the
auctioneer are quite on the cards. The
businessman makes uncanny calculations
before striking a bargain and that
circumstances must enter the judicial
verdict before deciding whether a better
price could be had by a postponement of
the sale. If Court sales are too frequently
adjourned with a view to obtaining a still
higher price, it may prove a self-defeating
exercise, for industrialists will lose faith
in the actual sale taking place and may not
care to travel up to the place of auction
being uncertain that the sale would at all
go through. The judgment debtor's plea
for postponement in the expectation of a
higher price in the future may strain the
credibility of the Court sale itself and may
yield diminishing returns.

21. Hon'ble Apex Court has further
observed in the case of M/s Kayjay
Industries (P) Ltd. (supra) while dealing
with material irregularity and substantial
injury under Order XXI, Rule 90 of the
Civil Procedure Code that it is the duty of
the Court to satisfy itself that having
regard to the market value of the property,
the price offered is reasonable. The
substantial
injury
without
material
irregularity is not enough even as material
irregularity
not
linked
direct
to
inadequacy of the price is insufficient. If
the Court should go on adjourning the
sale till a good price is got, it being a
notorious fact that the Court sale and
market price are distant neighbour.
Otherwise the decree holders can never
get the property of the debtor sold. Nor is
it right to judge the unfairness of the price
by hindsight wisdom. What is expected of
the Judge is not to be a prophet but a
pragmatist and merely to make a realistic
appraisal of the factors and if satisfied
that, in the given circumstances, the bid is
acceptable, conclude the sale.

22. The Court may consider fair
value of the property, the general
economic trends, the large sum required
to be produced by the bidder, the
formation of a syndicate, the futility of
postponements and possibility of the
litigation
and
several
other
factors
dependent on the facts of the each case.
Once that is done, the mater ends there.
No speaking order is called for and no
meticulous post mortem is proper. If the
Court has fairly, even if silently, applied
its mind to the relevant considerations
before it while accepting the final bid, no
probe
in
retrospect
is
permissible.
Otherwise, a new threat to certainty of the
Court sale will be introduced. Mere
inadequacy of price cannot demolish
every court sale. The same principle had
been laid down by Hon'ble Apex Court in
the case of Neyalkha and sons Vs.
Ramanya Das, (1970) 3 SCR 1 : (1969) 3
SCC 537.

23. Learned counsel for the
petitioner has relied upon a Division
Bench decision of this Court in the case of
Zila Parishad, Muzaffar Nagar and others
Vs. Udai Veer Singh, 1989 RD page 51
wherein the Division Bench observed that
3 All] Akhilesh Pathak V. State of U.P.and others
1481
where the highest bid is accepted and
highest bidder deposits 25% bid amount
within time allowed, the auction cannot
be cancelled thereafter. In the case of Zila
Parishad (supra), the auction was held on
17.3.1988. The the subject matter of the
auction was the right to ferry or load or
unload animals at the cattle fair for a
monetary consideration under the Uttar
Pradesh Zila Parishad and Kshetra Samiti
Adhiniyam, 1959. The auction was closed
upon the highest bid having been
received. The Zila Parishad attempted to
auction the subject matter of the auction
to yet another candidate outside the
auction subsequently. This led to the
highest bidder who had offered the
highest bid upon which the auction was
closed to seek an injunction to protect the
right to carry on his trade by filing civil
suit in the civil court. The highest bidder
was
granted
injunction.
The
Administrator, (Atrikt Mukhya Adhikari)
recommended re-auction to be held on
23.3.1988 on the ground that one person
(non bidder) had sent higher offer. Thus
re-auction was ordered after publication
in the newspapers informing the previous
highest bidder to take back his deposited
amount, the highest bidder had not been
intimated that his bid was hence not being
acted upon. The cause was a secret
unilateral offer, after the auction. The
highest bidder was not given any
opportunity of hearing before passing the
order of fresh auction.

24. This Court further held that the
highest
bidder
was
entitled
to
an
opportunity of being apprised of the
circumstances for recalling or cancelling
the auction. An opportunity was to be
afforded before recalling the result of the
auction. It was further held that the
auction is a sale by a public competition
to the highest bidder. Auction sales are of
two kinds, with reservation and without
reservation. The auction sale is with
reservation when the upset price is fixed
below which the auctioneer refused to
sell. It is not necessary that this particular
phraseology be used, it would be enough
indication that the seller makes it plain
and reserves the right. An auction is
without reservation when the goods are
sold to the highest bidder, whether the
sum paid is equivalent to real value or
not. The principle of sale by auction is
that the announcement about the auction
is a mere information to offer, the actual
bids made are all offers, each higher bid
superseding the previous bid, and that
when the hammer falls on the last bid
there is an acceptance and the contract
becomes complete.

25. After discussing the provisions
of Section 46 of the Contract Act, 1872
relating
to
reasonable
time
for
performance of promise and Sections 63
and 64 of the Indian Sale of Goods Act,
1930 relating to sale by auction, this
Court observed that the highest bidder
was made to deposit substantial money
within fixed time, another auction was
announced
without
affording
an
opportunity to the highest bidder to have
his say before such an announcement and
non rejection of the highest bid within
reasonable time, this virtually amounted
to rejecting the highest bid without
indicating it to the highest bidder and in
absence of an opportunity of hearing to
him. The attempt to re-auction was
surreptitious and entertained unilaterally
and secretly and as an after thought.
Giving an objective test to the facts and
circumstances of the auction and the
obligation which the highest bidder had
1482 INDIAN LAW REPORTS ALLAHABAD SERIES [2011
performed and was made to perform, the
contract was complete.

26. It was further held by this Court
that public bodies conducting public
auction will loose their credibility and the
conduct or public auction might lead to
endless litigations when they will be upset
without cause held profitably, regularly
and without defect. An auction which has
been regularly conducted strictly as
desired by a public body or government
with no illegality having been pointed out
and is at a monetary advantage over the
previous year, must be finalised. This
Court cannot permit an auction in which
no illegality has been pointed out to be
abandoned merely because of officials do
not act when they should have acted, or
chose to act when it was too late to act.

27. The learned counsel for the
petitioner has placed reliance on a
decision of Hon'ble Apex Court in the
case of Shri Radhey Shyam Vs. Shyam
Behari Singh, 1970 (2) SCC page 405,
contending that any auction can be set
aside only when there is proof of material
irregularity or fraud and not otherwise.

28. The learned counsel for the
petitioner drawing our attention to the
paragraph 23 of the counter affidavit filed
by Sri Chhedi Lal Singh, Tehsildar on
behalf of the respondents, has submitted
that the respondents conceded that there
had been no breach of terms and
conditions relating to the public auction in
the present case. No case of material
irregularity or fraud was either taken up
by the respondents or the same was
proved. No notice of the cancellation of
auction sale in favour of the petitioner
depositing the entire bid amount was
given before the aforesaid cancellation of
auction and order for re-auction. We may
mention here the relevant part of
paragraph 23 of the counter affidavit
wherein
it
has
been
averred
that
"However, in reply, it may be stated that
there is no breach of terms and conditions
of the auction." Paragraph 21 of the said
counter affidavit makes it evident that the
petitioner
was
informed
about
the
impugned order dated 22.7.2010 four
days later i.e. on 26.7.2010 and the
petitioner
was
not
afforded
any
opportunity of hearing before passing the
impugned order by which the said auction
was cancelled and re-auction was ordered.
Thus, the impugned order was passed
behind the back of the petitioner in a
clandestine manner for the reasons best
known to the respondents.

29. In the case of Shri Radhey
Shyam (supra) it was observed by the
Hon'ble Apex Court, what has to be
established is that there was not only
inadequacy
of
the
price
but
that
inadequacy was caused by reason of the
material
irregularity
or
fraud.
A
connection has thus to be established
between the inadequacy of the price and
the material irregularity.

30. The material available on record
clearly goes to establish that there was no
material irregularity or fraud in the
impugned auction till finality of the
auction, the petitioner was asked to
deposit 1/4th of the highest bid amount,
there was no question of inadequacy of
the price of vehicle in question. Had it
been there, the auctioning authority could
have cancelled or postponed the auction
on the ground of inadequacy of price and
submitted
report
to
the
competent
authority immediately. Not only this, the
petitioner who was the highest bidder,
3 All] Kamal Kishore Pal V. State of U.P.and others
1483
was allowed to deposit 1/4th of the bid
amount and he immediately thereafter
deposited Rs. 25,000/-. The amount was
accepted immediately thereafter issuing
receipts by the auctioning authority on
19.7.2010. Even thereafter, if the fact
regarding inadequacy of the price or
material irregularity or fraud was within
the knowledge of the auctioning authority,
the petitioner was allowed to deposit 3/4th
of the balance amount of bid i.e. Rs.
60,000/- on 21.7.2010 and the petitioner
was issued a receipt of the deposit of
3/4th balance amount of the bid by the
auctioning authority on the same day.

31. Thus, after getting the whole
amount of the bid received by the
auctioning authority till 21.7.2010, the
auctioning authority in a shocking and
surprising way recommended to the
S.D.M./respondent no. 2 for re-auction of
the vehicle in question with some ulterior
motive just on the ground of inadequacy
of the price. If any inadequacy of price
had been within the knowledge of the
auctioning authority at the time of
completion of the auction, there would
not have been any reason for him to
submit a report recommending for reauction subsequently with delay. On the
basis of the said report of the auctioning
authority
dated
22.7.2010,
the
S.D.M./respondent no. 2 passed the
impugned order in one sentence to the
effect that "agreed, the auction cancelled,
the re-auction be made as per the rules."
This by can no stretch of imagination be
called a speaking or legal order which
was passed behind the back of the
petitioner. If for a moment the point of
some commotion during the progress of
auction was there, the same did not find
place in the relevant report dated
22.7.2010 submitted to the S.D.M. by
which he recommended for re-auction.
The impugned order passed by the
respondents
appears
to
be
illegal,
perverse, unjust, arbitrary and malafide.

32. The impugned order dated
22.7.2010 passed by the respondent no.2/
Sub Divisional Magistrate, Nizamabad,
Azamgarh, (Annexure No.1), is set aside.
The respondent nos. 2 and 3 are directed
to release the auctioned Bolero Jeep 2003
Model (Chassis No.MA-1XA2 ACB) in
favour of the petitioner from Police
Station Gambhirpur, Azamgarh.

33.

With
the
aforesaid
observations/directions, the writ petition
stands allowed.
---------
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 11.11.2011

BEFORE
THE HON'BLE DILIP GUPTA, J.

Civil Misc. Writ Petition No. 58884 of 2011

Kamal Kishore Pal

 ...Petitioner
Versus
State of U.P. and others ...Respondents

Counsel for the Petitioner:
Sri Bhola Nath Yadav
Sri Rama Nand Yadav

Counsel for the Respondents
Sri R.A. Akhtar
C.S.C.

Constitution
of
India,
Article
226Diploma in L.T. Grade-seeking direction
regarding eligibility to participate in
T.E.T. Examination-treating equivalent to
B.Ed.-held in view of Section 23 (1) of
Right of children to free and compulsory
Education
Act,
2009-not
eligible
to
appear U.P.T.E.T.-petition dismissed.