Auction Sale: When idea behind bid was pure and clear sale simplicitor, no condition to furnish Annual Turnover and Net Worth for last 3 years was mandatory
Civil Appeal No. 5101 of 2016
Bench: Chief Justice of India T. S. Thakur; Justice Uday Umesh Lalit
Case Brief: The present appeal was arising out of the judgment and order of the High Court of Himachal Pradesh which has affirmed the decision of Single Judge of High Court in Writ Petition. The challenge is brought against the correctness of the said decision of High Court. In the facts of the case, the Himachal Tourism invited bids by its advertisement from the interested parties for outright purchase of sites located at 3 places in State, including the Café Aabshar in Solan District. The case is limited to the said Café Aabshar, in connection to which the respondent no. 1 and appellant with other participated in the process of bid. The appellant notably submitted highest bid and as such his bid was accepted and Letter of Intent was issued to him and also sale deed was executed in favour of appellant in respect of said Café Aabshar. Thereafter, the said respondent no. 1 who being running a Dhaba next to the site filed Writ Petition in High Court and claimed that appellant had not submitted his annual turnover and net worth for last 3 years as stipulated in the advertisement. State Government and Appellant opposed the writ petition, however, that petition was allowed by Single Judge and quashed Letter of Intent and Sale Deed and asked the authorities to re- do the entire process. Unsatisfied with the said, the appellant challenged the decision before the Division Bench of High Court, which has upheld the view of Single Judge and dismissed the appeal of appellant.
The bench observed that there was no reserve price fixed while inviting bids. The Expert Committee may have indicated a figure as reserve price, however, the advertisement did not indicate any. Thus, the bench decided to consider the issue that “whether requirement to furnish Annual Turnover and Net Worth for last 3 years was a mandatory condition for infraction of which the bid made by the appellant had to be rejected.” It was later observed by this bench that the idea behind the bid, was pure and clear sale simplicitor. Also, bench found that the Appellant paid entire bid amount within prescribed period thus, sale deed was executed in his favour. Thus, the authorities herein had validly deviated from and not insist upon strict literal compliance. As such, the bench observed that the assessment made by High Court as to the question of condition, that it was essential condition for non- compliance of which, the bid furnished by the appellant was required to be rejected, was held by this bench as not correct. The appeal as such allowed and High court’s decisions were set aside. Thus, the said Letter of Intent and Sale Deed executed in favour of appellant were held valid and correct.
Read the Judgement: Om Prakash Sharma Vs. Ramesh Chand Prashar & Ors