K. Kumara Gupta vs Sri Markendaya and Sri Omkareswara Swamy Temple

K. Kumara Gupta vs Sri Markendaya and Sri Omkareswara Swamy Temple

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS. 791-792 OF 2022
K. Kumara Gupta ...Appellant(s)
Versus
Sri Markendaya and
Sri Omkareswara Swamy Temple & Ors. ...Respondent(s)
J U D G M E N T
M.R. SHAH, J.
1. Feeling aggrieved and dissatisfied with the impugned judgment
and order dated 18.09.2019 passed by the High Court of Andhra
Pradesh at Amaravati in Writ Appeal Nos.790 and 1069 of 2018 by which
the High Court has allowed the said writ appeals and has directed the
authorities concerned to conduct a re-auction of the entire properties by
fixing the upset price higher than what has been fixed earlier, the auction
purchaser, who purchased the property in question in the year 1998, has
preferred the present appeals.
2. The facts leading to the present appeals and the chronological
dates and events are as under:-
1
2.1 That a proposal was published by the office of Commissioner,
Endowments Department to auction the land in question belonging to Sri
Markendaya and Omkareswara Swamy Devasthanam, Eluru, which was
published in the newspaper on 10.03.1997. Notification to sell the
subject land was published in the Andhra Pradesh Gazette on
22.05.1997. Nobody raised any objection against the said proposal.
That the probable expected price of the land was fixed at Rs. 4,00,000/-
per acre and the total extent of land was about 1.81 acre. That
thereafter the Commissioner of Endowments Department granted
permission to sell the land in question on 13.11.1997. The Executive
Officer of the Temple Trust issued tender/public notice to sell the land in
question by way of an open auction in the presence of the Deputy
Commissioner, Endowments on 22.05.1998. As per the notice, the date
and time of the open auction was 24.06.1998 at 11.00 AM and the
interested participants had to deposit Rs.20,000/- as EMD. Forty-five
persons participated including the appellant herein – K. Kumara Gupta.
At this stage, it is required to be noted that Shri L. Kantha Rao, original
writ petitioner did not participate in the auction and nor did he deposit the
EMD of Rs.20,000/-.
2.2 Thereafter the auction took place on 24.06.1998 in which 45
people participated. The appellant herein was declared as the highest
bidder quoting price of Rs.5,55,000/- per acre against the expected price
2
of Rs.4,00,000/-. However, thereafter, the highest offer of the appellant
was Rs.13,01,000/- per acre as per the bid submitted by the appellant
herein. Thus, the appellant became the highest bidder fixing the price at
Rs.13,01,000/- per acre. The appellant deposited Rs.7,85,000/- being
1/3rd of the bid amount immediately as per the tender conditions. It
appears that thereafter the first round of litigation started at the instance
of one Shri Jagat Kumar, who as such did not participate in the auction
which was held on 24.06.1998. He made a representation on
20.07.1998 that the subject land has a potential of getting more money.
Though, initially he had shown his readiness and willingness to pay the
higher price but did not deposit the money. On the contrary, he
expressed his willingness to buy only 1200 square yards but not the
entire land put to auction. On the representation of the said Shri Jagat
Kumar, the auction came to be cancelled vide order dated 24.07.1998.
The appellant filed the revision under Section 93 of the Endowments Act,
1987 (hereinafter referred to as the “Act of 1987”) against the order
dated 24.07.1998 cancelling the auction. However, thereafter by order
dated 22.12.1998, the order confirming the sale was issued by the Office
of the Commissioner, Endowments Department in favour of the
appellant. The Executive Officer of the Temple was directed to get the
sale deed registered in the name of the highest bidder.
3
2.3 That thereafter the appellant deposited balance amount of
Rs.15,69,810/- vide four banker cheques dated 30.12.1998. The sale
deed was executed in favour of the appellant by Executive Officer on
behalf of the Temple vide Sale Deed dated 31.12.1998. As mentioned in
the sale deed, the physical possession of the land in question was also
delivered to the appellant.
2.4 That at the relevant time, the sale deed could not be registered
because of the non-availability of the Clearance Certificate from the
Income Tax department. The sale deed was presented for registration
before the Sub-Registrar, Eluru on 01.01.1999. On 01.01.1999, the
Executive Officer of the Temple/Devasthanam filed an affidavit before the
Income Tax Office for Clearance Certificate so that the sale deed could
be registered. The Clearance Certificate was granted to the Executive
Officer on 12.01.1999. Thus, the first round of litigation ended there.
2.5 However, the second round of litigation begun at the instance of
one Shri L. Kantha Rao, the original writ petitioner before the High Court,
and one of the respondents in these appeals, who as such and as
observed hereinabove did not even participate in the public auction
proceedings. The said Shri L. Kantha Rao filed a Writ Petition No. 41 of
1999 before the High Court to direct the Executive Officer/ the Temple
Committee not to execute the sale deed in respect of the auctioned land.
4
Vide interim order dated 05.01.1999, the High Court granted interim stay
of all further proceedings subject to the condition that he furnishes a
bank guarantee of a sum of Rs.30 lakhs within two weeks from the date
of the said interim order. That during the pendency of the aforesaid writ
petition and in light of the interim order passed by the High Court in the
aforesaid writ petition, being Writ Petition No. 41 of 1999, the office of
the Commissioner, Endowments Department unilaterally passed an
order dated 10.02.1999 cancelling the auction held on 24.06.1998. The
Executive Officer of the Temple was instructed to conduct a re-auction
for the land in question keeping the upset price of Rs.30 lakhs. As the
order dated 10.02.1999 was passed without hearing the appellant, the
appellant preferred revision before the Government under Section 93 of
Act of 1987. The Government stayed the order dated 10.02.1999 of the
Commissioner vide its order dated 08.03.1999. Questioning the order of
the Government dated 08.03.1999 staying the order of the
Commissioner dated 10.02.1999, the said Shri L. Kantha Rao filed
another Writ Petition No. 11552 of 1999 before the High Court. That by
order dated 11.03.1999, the Commissioner himself revoked his order
dated 10.02.1999. That by order dated 09.07.1999, the High Court
disposed of both the writ petitions, i.e., Writ Petition No. 41 of 1999 and
Writ Petition No. 11552 of 1999. It appears that the High Court while
disposing of the aforesaid writ petitions observed that as the
5
Commissioner had revoked the order dated 10.02.1999, the revision
filed against the same had become infructuous and Government was not
required to decide the issue on merits unless suo moto revision was
taken up by the Government. However, liberty was granted to the said
Shri L. Kantha Rao to file a revision against the original order passed by
the Commissioner dated 22.12.1998 confirming the sale in favour of the
appellant. The second round of litigation ended there.
2.6 Then the third round of litigation began. On the basis of the liberty
granted by the High Court, the said Shri L. Kantha Rao filed a revision
before the Government challenging the order dated 22.12.1998 although
he was not a participant in the auction in which appellant herein was
declared the highest bidder. By order dated 26.11.1999, the said
revision came to be allowed quashing and setting aside the order dated
22.12.1998 and directing the Commissioner to refund the amount paid
by the appellant and to conduct a re-auction. Even the said order dated
26.11.1999 was passed without hearing the appellant. The appellant
filed Writ Petition No. 25407 of 1999 before the High Court challenging
the order dated 26.11.1999. By a detailed judgment and order dated
02.02.2018, the learned Single Judge allowed the Writ Petition No.25407
of 1999 (which shall be dealt with hereinbelow). The said Shri L. Kantha
Rao died on 01.03.2018. That the respondent No.1 herein – the Temple
through its Executive Officer filed Writ Appeal No.790 of 2018 before the
6
Division Bench challenging the judgment and order dated 02.02.2018
passed in Writ Petition No.25407 of 1999 on 16.03.2018. The wife of
Shri L. Kantha Rao also filed Writ Appeal No. 1069 of 2018 challenging
the judgment and order passed by the Learned Single Judge in Writ
Petition No.25407 of 1999.
2.7 By the impugned common judgment and order, the Division Bench
of the High Court has allowed the said appeals and has set aside the
judgment and order passed by the learned Single Judge passed in Writ
Petition No.25407 of 1999 and has directed the authorities concerned to
conduct the re-auction of the entire land by fixing the upset price higher
than what had been fixed earlier by observing that since more than
twenty years had elapsed from the date of issuance of GO Rt. No. 1808
dated 26.11.1999 and price of the land in question had risen. The
Division Bench of the High Court has further observed that as the
appellant has agreed and even the learned Single Judge had directed
the appellant to pay Rs.30 lakhs as the said Shri L. Kantha Rao
furnished a bank guarantee of Rs. 30 lakhs and therefore, the Temple
would get more than Rs.30 lakhs. While passing the impugned
judgment and order, the Division Bench of the High Court has also
observed that the writ petitioner as well as the appellant shall also be
allowed to participate in the re-auction, if they are otherwise eligible.
7
2.8 Feeling aggrieved and dissatisfied with the impugned common
judgment and order passed by the Division Bench of the High Court, the
original respondent No.4 before the High Court, the auction purchaser
has preferred the present appeals.
3. Shri Harin P. Raval, learned Senior Advocate has appeared on
behalf of the appellant, Shri S. Niranjan Reddy, learned Senior Advocate
has appeared on behalf of the respondent – Temple Trust and Shri
Siddhartha Dave, learned Senior Advocate has appeared on behalf of
the wife of Shri L. Kantha Rao – the original writ petitioner.
4. Shri Harin P. Raval, learned Senior Advocate appearing on behalf
of the appellant has vehemently submitted that in the facts and
circumstances of the case the Division Bench of the High Court has
committed a grave error in setting aside the auction/sale in favour of the
appellant, which was held in the year 1998.
4.1 It is submitted that as such the auction sale was conducted after
wide publicity in the well-known newspapers and in fact, 45 people
participated in the auction. It is submitted that the appellant was found
to be the highest bidder and therefore the sale in favour of the appellant
was confirmed and the appellant paid the full sale consideration and
even the sale deed was also executed in favour of the appellant on
31.12.1998. It is submitted that as there was no illegality in conducting
8
the auction, therefore, the Division Bench of the High Court ought not to
have set aside such a sale after a period of approximately twenty years
from the date of conducting the public auction and the sale that too at
the instance of a person, who never participated in the auction.
4.2 It is submitted that Division Bench of the High Court ought to have
appreciated that as the said Shri L. Kantha Rao did not even participate
in the public auction and did not submit any offer, thereafter, he had no
locus to challenge the public auction and/or the sale in favour of the
appellant, who was found to be the highest bidder.
4.3 It is submitted that the Division Bench of the High Court ought to
have appreciated that merely because somebody, subsequently to the
completion of the public auction and the sale deed has been executed in
the favour of the highest bidder states that he is ready and willing to pay
a higher amount than the highest bid amount, would frustrate the object
and purpose of holding the public auction, if at such a person’s instance,
the auction/sale is interfered with in any manner. It is submitted that the
Division Bench of the High Court ought to have appreciated that at the
relevant time, nobody restrained the said Shri L. Kantha Rao from
participating in the public auction and submit his offer.
4.4 It is further submitted by Shri Raval, learned Senior Advocate
appearing on behalf of the appellant that as such the Division Bench of
9
the High Court has not at all observed and/or held that the auction was
illegal and/or there was any illegality in holding the public auction. It is
submitted that the Division Bench of the High Court has passed the
impugned judgment and order and has directed for re-auction solely on
the ground that subsequently the said Shri L. Kantha Rao offered Rs. 30
lakhs, which was higher than the amount paid by the appellant even
when the learned Single Judge had also directed the appellant to pay a
total sum of Rs.30 lakhs, which the appellant had agreed; therefore, the
Division Bench of the High Court has presumed that the value of the
land would have been much more than Rs.30 lakhs at the time when it
was put up for auction/sale. It is submitted that the High Court has not
at all appreciated the fact that as such the said L. Kantha Rao had no
locus to challenge the sale in favour of the appellant, who was the
highest bidder firstly, on the ground that he did not participate in the
public auction.
4.5 It is submitted that the Division Bench of the High Court has not
properly appreciated the fact that the proceedings initiated by Shri L.
Kantha Rao were by way of “Public Interest Litigation (PIL)” and
therefore after his death, his wife could not have continued the PIL
proceedings by way of writ petition before the High Court as a private
litigation. It is submitted by learned Senior Advocate for the appellant
that the entire litigation was at the instance of the second highest bidder
10
namely, Shri M.M. Gupta, brother-in-law of Shri L. Kantha Rao, who had
purchased the nearby lands to the auctioned land in the name of his
family members at Rs.7,50,000/- per acre on 28.07.1998 and
22.09.1998 and who had an eye on the land in question.
4.6 It is submitted by Shri Raval, learned Senior Advocate appearing
on behalf of the appellant that filing of objections and entertaining the
same after the conclusion of the auction and after execution of the sale
deed cannot be permitted at the instance of a stranger to the auction
proceeding. It is submitted that in the present case, the sale deed was
executed in favour of the appellant herein being the highest bidder in the
public auction in which 45 persons had participated and therefore to
maintain the sanctity of the public auction, the objections ought not to
have been entertained that too by a person, who never participated in
the public auction, more particularly, when no allegation of fraud was
even pleaded, much less established or proved by the respondents.
Reliance is placed on the decision of this Court in the case of Valji
Khimji and Company Vs. Official Liquidator of Hindustan Nitro
Product (Gujarat) Limited and Others, (2008) 9 SCC 299 (paras 11,
12, 25 and 28).
4.7 It is further submitted by Shri Raval that as such the wife of the
deceased Shri L. Kantha Rao could not have preferred an appeal as an
11
heir of Shri L. Kantha Rao, a petitioner, who had filed the petition as a
Public Interest Litigation. It is submitted that as such the litigation
initiated on behalf of Shri M.M. Gupta the second highest bidder by Shri
L. Kantha Rao, was in fact a private interest litigation only in the guise of
a Public Interest Litigation to thwart the auction sale. It is submitted that
the learned Single Judge had rightly reached to the conclusion that the
respondents – writ petitioners had no locus standi to raise the objection
as well as to file the writ petitions before the High Court as admittedly
they did not participate in the auction.
4.8 It is further submitted that the Temple Trust never objected at any
stage of auction or after the auction until the order/judgment dated
02.02.2018 was rendered by the learned Single Judge. It is submitted
that the Executive officer of the Temple, who was aware of the entire
proceedings including conducting of the public auction and after
receiving the full and total consideration could not have challenged the
judgment and order passed by the learned Single Judge rendered on
02.02.2018 at a belated stage, i.e., almost after twenty years from the
date of the execution of the sale deed. It is submitted that filing of an
appeal by the Temple Trust against the judgment and order dated
02.02.2018 before the Division Bench without any allegation of fraud or
collusion against it reeks of mala fides and collusion, which ought not to
have been allowed. In fact, the Division Bench of the High Court ought
12
not to have entertained the same, is the submission.
4.9 Making the above submissions, it is urged that the Division Bench
of the High Court has committed a grave error in quashing and setting
aside the sale in favour of the appellant after a period of 23 years and
when the appellant had paid the entire sale consideration on 30.12.1998
and was put in the possession on execution of the sale deed. It is
contended that the Division Bench of the High Court has not properly
appreciated the fact that as such the sale was confirmed in favour of the
appellant after the approval by the competent authority of the
Endowments Department.
5. Learned counsel appearing on behalf of the respondent No.3 has
submitted that the respondent No.1 – Temple is a public religious
institution and registered under Section 6(b)(ii) of Act of 1987. It is
submitted that the Government under the Act of 1987 is necessarily
bound to act for the benefit of the temples and ensure revenue
maximization for the temples. That as held by this Court in a catena of
decisions Government acts as a trustee of the said properties. It is
submitted that as observed and held by this Court in a catena of
decisions, the duty of the State is parens partriae in respect of the
charitable endowments and to ensure its due protection. Reliance is
placed on the decisions in Paramananda Mahapatra Vs.
13
Commissioner of Hindu Religious Endowments, Orissa and Others,
AIR 1966 SC 1544 and Mahant Ram Saroop Dasji Vs. S.P. Sahi, 1959
Supp (2) SCR 583.
5.1 It is submitted that therefore the Government cannot act against
the interest of the temple. That in the present case the auction was
conducted on behalf of the Deity, which is in law a perpetual minor.
Therefore, it is important to ensure that the trustees act strictly in
accordance with the interest of the Deity. It is submitted that in the
present case, the consideration paid was inadequate as on the date of
auction. That initially the appellant offered Rs.13,01,000/- per acre,
which was treated as the highest bid and the same was confirmed. That
one Shri Jagat Kumar through representation dated 24.07.1998 stated
that he was willing to offer Rs. 22,00,000/- per acre, i.e., Rs. 7 lakhs
more than the price on which the bid was confirmed in favour of the
appellant. Also one Shri L. Kantha Rao submitted a bank guarantee for
an amount of Rs. 30 lakhs on 05.01.1999 pursuant to the directions
passed by the High Court in Writ Petition No. 41 of 1999 on his
submission that he was ready and willing to purchase the property in
question at Rs. 30 lakhs. It is submitted that thereafter the State
Government vide its order dated 26.11.1999 fixed the reserved at Rs.32
lakhs and allowed the parties to participate in the auction. It is submitted
that the aforesaid facts evidently reveal that within a period of one year,
14
the price of the property significantly increased by more than 125%. That
the value of the property, as on date, is about 15 crores. It is submitted
that therefore in the interest of the Deity, the impugned judgment and
order passed by the Division Bench of the High Court may not be
interfered with.
5.2 Relying upon the decision of the Division Bench of the High Court
in the case of Princess Fatima Fauzia and Anr. Vs. Syeed UI-Mulk
alias Nawab Saheb Chathari & Ors., AIR 1979 AP 229, it is submitted
that as held the Division Bench of the High Court, the authorities ought
to have permitted re-auction where, in case of a trust, the consideration
is inadequate.
5.3 It is further submitted by the learned Senior Advocate appearing on
behalf of the respondent No.3 that it is the duty of the Court to ensure
that the price fetched is adequate – especially in the case of a Public
Trust even though there is no suggestion of irregularity or fraud.
Reliance is placed on the decision of this Court in the case of Divya
Manufacturing Company (P) Ltd. Vs. Union Bank of India and Ors.,
(2000) 6 SCC 69.
5.4 It is further submitted by the learned Senior Advocate appearing
on behalf of respondent No.3 that by the impugned judgment and order
passed by the Division Bench of the High Court, no prejudice shall be
15
caused to the appellant as the Division Bench of the High Court has
directed that the money deposited including the amount incurred on
account of purchase of stamp papers be refunded to the appellant and
the appellant will also be getting the benefit of the prevailing bank
interest on the deposited amount. Further, the appellant is also
permitted to participate in the re-auction. It is therefore prayed not to
interfere with the impugned judgment and order passed by the Division
Bench of the High Court considering the interest of the charitable
institution.
6. Learned Senior Advocate appearing on behalf of respondent No.1
– Temple Trust / Devasthanam in addition to the submissions made by
the learned Senior Advocate appearing on behalf of respondent No.3
has submitted that in the matter of sale of public property/auction, the
dominant consideration is to secure the best price for the property. It is
submitted that the court should always keep the larger interest of the
public in mind while interfering with the decision of the authority. Further,
the concept of locus standi has been widened by this Court while dealing
with matters of public interest. It is submitted that it is the duty of the
Court to see that the price fetched is adequate.
6.1 Learned counsel appearing on behalf of the respondent No.1 has
relied upon the decisions of this Court in the case of Chairman and
16
Managing director, SIPCOT, Madras and Ors. Vs. Contromix Pvt.
Ltd., (1995) 4 SCC 595; Union Bank of India Vs. Official Liquidator
H.C of Calcutta and Ors., (2000) 5 SCC 274 and Navalkha and Sons
Vs. Sri Ramanya Das and Ors., (1969) 3 SCC 537 in support of his
submission that in the matter of sale of public property/auction the
dominant consideration is to secure the best price for the property.
6.2 Making the above submissions and relying upon above decisions,
it is prayed to dismiss the present appeals.
7. Heard the learned counsel appearing for the respective parties at
length.
8. At the outset, it is required to be noted that by the impugned
judgment and order, the Division Bench of the High Court has ordered
re-auction of the land in question by fixing the upset price more than
what has been fixed earlier by observing that since more than 20 years
have elapsed from the date of the issuance of G.O. dated 26.11.1999, it
is in the interest of the Temple that the property in auction is put to reauction. However, it is required to be noted that the appellant purchased
the property in question in a public auction, which took place on
24.06.1998. He was found to be the highest bidder, who offered
Rs.13,01,000/- per acre. It is also required to be noted that in the said
auction, which took place on 24.06.1998, in all 45 people participated.
17
The auction was conducted after following due procedure under the
provisions of the Act of 1987 and the auction was conducted by none
other than the Executive Officer of the Temple Trust. It is also to be
noted that after receiving a detailed report of Assistant Commissioner of
Endowments, office of the Commissioner, Endowments Department vide
order dated 22.12.1998 confirmed the sale in favour of the appellant.
Consequently, the appellant deposited the balance amount. The sale
deed came to be executed in his favour vide Sale Deed dated
31.12.1998. Even thereafter on the application made by the Executive
Officer of the Devasthanam/Temple, the Income Tax Department granted
Clearance Certificate to the Executive Officer on 12.01.1999. Therefore,
as such the sale, which was held and confirmed in the year 1998 and for
which the sale deed was executed on 31.12.1998, the Division Bench of
the High Court has ordered re-auction of the property in question after a
period of more than 23 years solely on the basis of the offer made by
one Shri Jagat Kumar in the year 1998 (after the public auction was
concluded) and the offer made by one Shri L. Kantha Rao that they are
ready to offer / pay a higher price than fetched in the public auction
already concluded and therefore, the Division Bench of the High Court
has presumed that the value of the property must have been much more
than the sale consideration realized in the public auction. However, the
Division Bench of the High Court has not at all appreciated and
18
considered the lack of bona fides on the part of the said Shri Jagat
Kumar and even Shri L. Kantha Rao. It is to be noted that though in the
month of July, 1998, i.e., after the public auction was held, the said Shri
Jagat Kumar, who even did not participate in the auction proceedings
initially came out with a case that he was ready and willing to pay a
higher price for the auctioned land. But subsequently, he backed out
and did not deposit any money. Neither did the said Shri Jagat Kumar
nor Shri L. Kantha Rao had participated in the auction proceedings and
made any offer. Therefore, as such both of them ought not have been
permitted to raise any objection subsequently on the valuation when
they had not participated in the public auction and made any offer. The
Division Bench of the High Court ought to have considered whether
these subsequent objectors had acted in a bona fide manner. At this
stage, it is required to be noted that even Shri Jagat Kumar
subsequently did not prosecute the matter further and subsequently it
was only Shri L. Kantha Rao, who filed the revision before the
Government by way of a “Public Interest Litigation”. It is also to be noted
that neither the Government nor even the Division Bench of the High
Court have given any finding that the auction, which was conducted/held
on 24.06.1998 was in any way irregular and/or illegal. Even the Division
Bench of the High Court has as such not set aside the auction/sale in
favour of the appellant, however, it has ordered re-auction by observing
19
that as Shri L. Kantha Rao deposited a sum of Rs. 30 lakhs pursuant to
the interim order passed by the High Court in Writ Petition No. 41 of
1999 and as even the learned Single Judge had also directed the
appellant to pay a total sum of Rs. 30 lakhs, which the appellant had
agreed, the Division Bench of the High Court has observed that the
value of the property can be said to be much more than what was
realized in the public auction.
8.1 Once the appellant was found to be the highest bidder in a public
auction in which 45 persons had participated and thereafter when the
sale was confirmed in his favour and even the sale deed was executed,
unless and until it was found that there was any material irregularity
and/or illegality in holding the public auction and/or auction/sale was
vitiated by any fraud or collusion, it is not open to set aside the auction
or sale in favour of a highest bidder on the basis of some
representations made by third parties, who did not even participate in the
auction proceedings and did not make any offer. In this context, we rely
on the following observations of this Court in the case of Jasbhai
Motibhai Desai Vs. Roshan Kumar, Haji Bashir Ahmed and Ors.,
(1976) 1 SCC 671 made in paragraphs 34, 37 and 49, which are as
under:-
“34. This Court has laid down in a number of decisions
that in order to have the locus siandi to invoke the
20
extraordinary jurisdiction under Article 226, an applicant
should ordinarily be one who has a personal or individual
right in the subject-matter of the application, though in the
case of some of the writs like habeas corpus or quo
warranto this rule is relaxed or modified. In other words,
as a general rule, infringement of some legal right or
prejudice to some legal interest inhering in the petitioner
is necessary to give him a locus standi in the matter,
(see State of Orissa v. Madan Gopal Rungta [AIR 1952
SC 12 ]; Calcutta Gas Co. v. State of W.B. [AIR 1962 SC
1044]; Ram Umeshwari Suthoo v. Member, Board of
Revenue, Orissa [(1967) 1 SCA 413]; Gadde
Venkateswara Rao v. Government of A.P. [AIR 1966 SC
828]; State of Orissa v. Rajasaheb Chandanmall [(1973) 3
SCC 739]; Satyanarayana Sinha Dr v. S. Lal &
Co. [(1973) 2 SCC 696] ).
37. It will be seen that in the context of locus standi to
apply for a writ of certiorari, an applicant may ordinarily
fall in any of these categories: (i) “person aggrieved”; (ii)
“stranger”; (iii) busybody or meddlesome interloper.
Persons in the last category are easily distinguishable
from those coming under the first two categories. Such
persons interfere in things which do not concern them.
They masquerade as crusaders for justice. They pretend
to act in the name of pro bono publico, though they have
no interest of the public or even of their own to protect.
They indulge in the pastime of meddling with the judicial
process either by force of habit or from improper motives.
Often, they are actuated by a desire to win notoriety or
cheap popularity; while the ulterior intent of some
applicants in this category, may be no more than spoking
the wheels of administration. The High Court should do
well to reject the applications of such busybodies at the
threshold.
49. It is true that in the ultimate analysis, the jurisdiction
under Article 226 in general, and certiorari in particular is
discretionary. But in a country like India where writ
21
petitions are instituted in the High Courts by the thousand,
many of them frivolous, a strict ascertainment, at the
outset, of the standing of the petitioner to invoke this
extraordinary jurisdiction, must be insisted upon. The
broad guidelines indicated by us, coupled with other wellestablished self-devised rules of practice, such as the
availability of an alternative remedy, the conduct of the
petitioner etc. can go a long way to help the courts in
weeding out a large number of writ petitions at the initial
stage with consequent saving of public time and money.”
In the aforesaid decision, it was also observed that despite
adequate opportunity, if a person has not lodged any objection at an
appropriate stage and time, he could not be said to have been in fact,
grieved.
8.2 It is also required to be noted that the sale was confirmed in favour
of the appellant by the Commissioner, Endowments Department after
obtaining the report of the Assistant Commissioner. Therefore, we are of
the opinion that in the aforesaid facts and circumstances of the case, the
High Court ought not to have ordered re-auction of the land in question
after a period of 23 years of confirmation of the sale and execution of the
sale deed in favour of the auction purchaser by observing that the value
of the property might have been much more, otherwise, the object and
purpose of holding the public auction and the sanctity of the public
auction will be frustrated. Unless there is concrete material and it is
established that there was any fraud and/or collusion or the land in
22
question was sold at a throw away price, the sale pursuant to the public
auction cannot be set aside at the instance of strangers to the auction
proceeding. The sale pursuant to the public auction can be set aside in
an eventuality where it is found on the basis of material on record that
the property had been sold away at a throw away price and/or on a
wholly inadequate consideration because of the fraud and/or collusion
and/or after any material irregularity and/or illegality is found in
conducing/holding the public auction. After the public auction is held and
the highest bid is received and the property is sold in a public auction in
favour of a highest bidder, such a sale cannot be set aside on the basis
of some offer made by third parties subsequently and that too when they
did not participate in the auction proceedings and made any offer and/or
the offer is made only for the sake of making it and without any serious
intent. In the present case, as observed hereinabove, though Shri Jagat
Kumar immediately after finalising the auction stated that he is ready and
willing to pay a higher price, however, subsequently, he backed out. If
the auction/sale pursuant to the public auction is set aside on the basis
of the such frivolous and irresponsible representations made by such
persons then the sanctity of a public auction would be frustrated and the
rights of a genuine bidder would be adversely affected.
8.3 Further, the Division Bench of the High Court ought to have
appreciated that the objector – Shri L. Kantha Rao, who did not
23
participate in the auction proceedings and submit any bid can be said to
be a fence sitter having no stakes on his shoulder and had simply come
forward just to nullify the registered sale deed executed in favour of the
appellant by adopting an indirect method of making a public offer by way
of filing a “Public Interest Litigation” before the High Court. The so-called
lucrative offer initially made by Shri Jagat Kumar and the subsequent
offer made by Shri L. Kantha Rao appears to be made only to frustrate
the auction proceedings with a mala fide intent. As observed
hereinabove, if there was any error in the decision-making process
adopted by the authority, the remedy available was to question the sale
deed in an appropriate proceeding available under the law and not by
filing a petition under Article 226 of the Constitution of India.
8.4 The Division Bench of the High Court has observed that as the
said Shri L. Kantha Rao submitted a bank guarantee of Rs. 30 lakhs as
he offered to pay Rs. 30 lakhs and even the learned Single Judge had
also directed the appellant to pay a total sum of Rs.30 lakhs against his
original offer and the appellant had agreed to pay the same, the High
Court has presumed that the value of the property at the time of auction
would have been much more. There was no concrete material before
the Division Bench of the High Court to come to such a conclusion that
what was received in the public auction in the year 1998 was a lesser
amount and/or at the relevant time, the valuation of the property was
24
much more than the highest bid received. Merely because the appellant
might have agreed to pay a total sum of Rs.30 lakhs (after deducting
whatever he paid earlier), by that itself, it cannot be presumed and/or
held against the appellant that in the year 1998 what was offered by him
was a lesser amount than the actual valuation. The appellant agreed to
pay a higher price for the land in question in order to save his rights.
8.5 At the cost of repetition, it is observed that as such there was no
material available with the Division Bench to the effect that the valuation
of the property in the year 1998 was much more and that the highest bid
of the appellant was for a lesser consideration than the actual value of
the land.
8.6 In fact, the learned Single Judge had passed a detailed judgment
and order quashing and setting aside the order passed by the
Government dated 26.11.1999. Learned Single Judge specifically
observed in paragraphs 8, 9, 12 and 14 as under:-
“8. The repeated orders of the second respondent
passed time and again in this matter are found to be
without assigning any cogent reasons. Under the Indian
Contract Act, which is a Central Act, having an over riding
effect upon the Endowments Act, more particularly when
the matter pertains to contractual obligations between
both the parties i.e., between the vendor and the vendee
and also when the matter pertains to tender-cum-auction,
where both parties have fulfilled their part of obligations
and where no fraud played by the parties has been
established, the action of the second respondent in
canceling the sale deed is unwarranted. The conduct of
25
the 4th respondent cannot be appreciated, where he has
not participated in the tender-cum-auction and more so,
he is not an effected party. Only after knowing the tender
and auction amount, the 4th respondent appears to have
either got tempted by the sale of the property or he has
been planted by the persons having vested interest. This
kind of conduct cannot be encouraged. It is an
undisputed fact that petitioner, 45 persons filed tenders
and participated in the auction, nothing prevented the 4th
respondent from filing tender and participating in the
auction.
9. As stated supra, the respondents have not
made out a case of fraud in conducting the sale and also
they have not raised any objection at the time of
conducting sale proceedings. The respondents
conveniently causing interference, at a later stage cannot
be accepted and they are estopped from raising
objections after conducting the sale
proceedings……………
12. Respondent No.4 has not approached this Court
with clean hands. He has no locus standi. He did not
participate in the tender-cum-auction and when 45
persons participated in tender-cum-auction, nothing
prevented the 4th respondent to participate in tender-cumauction proceedings. Mere depositing the money saying
that the amount would fetch more is of no argument that
can be looked into without establishing malafides or fraud
played by the vendor or vendee. No relief can be granted
to respondent No.4 in the writ petition filed by the
petitioner.
14. Once the contractual obligation has been
completed by both parties and sale deed is executed, the
second respondent has no jurisdiction in the matter to
cancel the same and it is the competent Court of law
which has jurisdiction to decide the validity.”
8.7 None of the aforesaid aspects have been dealt with and/or
considered by the Division Bench of the High Court while passing the
26
impugned judgment and order. Even it was the specific case of the
appellant before the learned Single Judge that the order dated
26.11.1999 passed by the Government cancelling the sale and ordering
for re-auction was passed without hearing him. The same is also not
dealt with by the Division Bench of the High Court.
8.8 Now, in so far as the submission on behalf of the respondents that
the value of the property as on today is Rs. 15 crores approximately and
therefore in the interest of the Deity/Temple, the impugned judgment and
order passed by the Division Bench of the High Court may not be
interfered with by this Court is concerned, it is to be noted that by the
passage of time the value of the property is bound to increase. In the
present case, subsequent to the auction and the sale, more than 23
years have passed, therefore, whatever was the value in the year 1998
would not be same at a future date and that too, after 20-23 years. What
is required to be considered is, at the relevant time, when the sale was
conducted, what was the value of the land/property. Learned Senior
Advocate appearing on behalf of the respondents are not in a position to
point out any material on which it can be said that what was offered by
the appellant in the year 1998 was not a fair value. The base price was
Rs.4,00,000/- per acre in the public auction, in which 45 persons
participated and what was offered by the appellant, i.e., Rs. 13,01,000/-
per acre was much higher than the base price. Under normal
27
circumstances, unless there are allegations of fraud and/or collusion
and/or cartel and/or any other material irregularity or illegality, the
highest offer received in the public auction may be accepted as a fair
value. Otherwise, there shall not be any sanctity of a public auction.
8.9 By the impugned judgment and order by ordering re-auction, the
Division Bench of the High Court has permitted both, the appellant as
well as the original writ petitioner to participate in the re-auction. It is to
be noted that as such the original writ petitioner never participated in the
public auction, which was conducted/held on 24.06.1998. Therefore, by
such a liberty being granted, the High Court has given one another
opportunity to the original writ petitioner, who has died, and/or to his
heirs to participate in the re-auction, which liberty could not have been
reserved. As a result, the writ petition filed by the deceased petitioner
Shri L. Kantha Rao has ceased to be a “Public Interest Litigation” but it is
a litigation with a private mala fide interest as the original writ petitioner
had no locus to file such a case, not being a participant in the auction
and being unable to point out any irregularity or illegality in the auction.
8.10 Even the Division Bench of the High Court ought not to have
passed the impugned judgment and order in an appeal preferred by the
Temple Trust for the simple reason that it was the Executive Officer of
the Temple Trust, who had conducted the auction; it was the Executive
28
Officer, who had obtained the Clearance Certificate from the Income Tax
department and who executed the sale deed in favour of the highest
bidder – appellant herein. At no point of time till the judgment and order
was passed by the learned Single Judge, the Temple Trust had
challenged the auction/sale on the ground that the amount realized was
inadequate. Therefore, the Temple Trust could not have challenged their
own decision, which they had never challenged earlier.
8.11 Similarly, the appeal preferred by the heirs of Shri L. Kantha Rao
also ought not to have been entertained. Shri L. Kantha Rao never
participated in the auction. He never submitted any offer. The
proceedings initiated by Shri L. Kantha Rao was in the nature of a Public
Interest Litigation and therefore being heir of Shri L. Kantha Rao, his
wife could not have been permitted to prosecute further with the Public
Interest Litigation.
8.12 Now, in so far as the decisions relied upon by the learned Senior
Advocate appearing on behalf of the respondents referred to
hereinabove are concerned, there cannot be any dispute to the
proposition of law laid down by this Court in the aforesaid decisions.
However, in the facts and circumstances of the case narrated
hereinabove, none of the decisions are of any assistance to the
respondents. There was/is no material to show that the market value at
29
the time of auction/sale in favour of the appellant was more than what
was offered by the appellant as a highest bidder. The base price fixed
was Rs. 4,00,000/- per acre against which the appellant being highest
bidder offered Rs.13,01,000/- per acre. In all 45 persons participated in
the auction, in which the appellant was found to be the highest bidder.
There are no allegations of fraud and/or collusion. According to the
appellant, the entire litigation started at the instance of Shri L. Kantha
Rao when one Shri M.M. Gupta, brother-in-law of Shri L. Kantha Rao,
who was the second highest bidder and who had purchased lands in the
name of his family members near the auction land at Rs.7,50,000/- per
acre on 28.07.1998 and 22.09.1998. Therefore, it is observed that the
proceedings initiated by Shri L. Kantha Rao as such cannot be said to
be a Public Interest Litigation but is squarely a private interest litigation in
the garb of espousing a public cause, which also did not exist in the
instant case. Therefore, in the facts and circumstances of the case, the
Division Bench of the High Court ought not to have passed an order for
re-auction of the property after a period of 23 years from the date of
auction/sale to the detriment of the rights of the appellant who was the
successful bidder in the auction sale. In this regard, we wish to rely on
some of the observations made by this Court in the case of State of
Uttaranchal Vs. Balwant Singh Chaufal and Ors., (2010) 3 SCC 402,
cautioning the High Courts to be more discerning / vigilant and/or
30
cautious while entertaining writ petitions apparently filed in public
interest. In the said decision, it is observed and held that: (1) The Courts
must encourage genuine and bona fide PIL and effectively discourage
and curb the PIL filed for extraneous considerations; (2) The Courts
should prima facie verify the credentials of the petitioner before
entertaining a PIL; (3) The Courts should be prima facie satisfied
regarding the correctness of the contents of the petition before
entertaining a PIL; (4) The Courts should be fully satisfied that
substantial public interest is involved before entertaining the petition; (5)
The Courts before entertaining the PIL should ensure that the PIL is
aimed at redressal of genuine public harm or public injury. The Court
should also ensure that there is no personal gain, private motive or
oblique motive behind filing the public interest litigation; and (6) The
Courts should also ensure that the petitions filed by busybodies for
extraneous and ulterior motives must be discouraged by imposing
exemplary costs or by adopting similar novel methods to curb frivolous
petitions and the petitions filed for extraneous considerations.

8.13 The submission on behalf of the respondents that as on today the
value of the property is Rs.15 crores and therefore, this Court may not
interfere with the impugned judgment and order passed by the Division
Bench of the High Court is concerned, the aforesaid cannot be
accepted. After a period of 20-23 years, the prices of lands are bound to
31
increase. The auction was conducted and held in the year 1998 and
was sold in favour of the appellant then on payment of the full sale
consideration as per the highest bid offered by him. Therefore, the
valuation as on the date of auction is the relevant consideration and not
the value after so many years and over two decades after conducting the
auction and confirming the sale.
9. In view of the above and for the reasons stated above, the
impugned judgment and order passed by the Division Bench of the High
Court is unsustainable and deserves to be quashed and set aside and is
accordingly quashed and set aside. The judgment and order passed by
the learned Single Judge in Writ Petition No.25407 of 1999 is hereby
ordered to be restored. However, as the appellant had agreed to deposit
the balance amount of Rs.6,45,190/- being the balance of Rs. 30 lakhs
and considering the fact that the respondent is a Temple Trust /
Devasthanam, we direct the appellant to pay to the respondent – Temple
Trust / Devasthanam a further sum of Rs. 15 lakhs (Rs.6,45,190/- plus
interest from 1998), to be paid by the appellant to the respondent –
Temple Trust /Devasthanam by demand draft /banker cheque within a
period of two weeks from today and take all consequential steps
pursuant to the auction/sale being confirmed in his favour including
getting registration of the sale deed in his name and taking possession
32
of the land in question in case the same have not yet taken place till
date.
Present appeals are accordingly allowed to the aforesaid extent.
However, in the facts and circumstances of the case, there shall be no
order as to costs.
Pending application(s), if any, also stands disposed of.
………………………………….J.
 [M.R. SHAH]
NEW DELHI; ………………………………….J.
FEBRUARY 18, 2022. [B.V. NAGARATHNA]

33

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले

Comments

Popular posts from this blog

संविधान की प्रमुख विशेषताओं का उल्लेख | Characteristics of the Constitution of India

100 Questions on Indian Constitution for UPSC 2020 Pre Exam

भारतीय संविधान से संबंधित 100 महत्वपूर्ण प्रश्न उतर