Jayaben vs K.B. Harihardas and Another

The petitioner challenges the conditions imposed by the State Government while allowing her Revision Application and setting aside the orders by which the auction sale in favour of her deceased husband was cancelled, to the effect that the property should be given at the market price to the petitioner and that she will not dispose of the property without the permission of the Collector-cum-Settlement Commissioner, Rajkot for a period of 5 years and further that the property should be used by her personally.

The facts which emerge from the record are that, evacuee property bearing No. 34 situate at Limbdi was sold in an auction on 9-2-1961 and was purchased by Shri Deva Govind, deceased husband of the petitioner, for an amount of Rs. 10,500/- the reserved price of Rs. 8,390/-. The Regional Settlement Commissioner at Bombay had confirmed the acceptance of the bid of Deva Govind in his letter dated 7-2-1962 and Deva Govind paid 10% of the purchase price as deposit and was requested to pay up the balance of the purchase price by way of claims including those of his associates. The balance of compensation payable to (by?) Deva Govind and his associates came to Rs. 6850/-and therefore there was a shortfall of Rupees 3650/-. Deva Govind expired on 27th February 1964. It appears that, for a long period from 1962 up to 1969, the Office of the Regional Settlement Commissioner, Bombay remained inactive in spite of this auction sale. By letter dated 23rd October 1969 addressed to Deva Govind, the Regional Settlement Commissioner, Bombay called upon him to pay Rs. 9450/- either in cash or by way of associating claims within 15 days of the receipt of that letter. The Regional Settlement Commissioner, Bombay was not aware about Deva Govind having expired on 27th February 1964 when the said letter was sent. Thereafter the Regional Settlement Commissioner, Bombay, on the footing that the demand was not complied with, cancelled the auction sale under Rule 90(14) of the Displaced Persons (Compensation and Rehabilitation) Rules, 1955. The petitioner thereupon made an application for cancellation of the orders of the Regional Settlement Commissioner which was treated as revision application by the Authorised Chief Settlement Commissioner and Joint Secretary to Government, Revenue Department, who by his order dated 27th May, 1976, rejected the application of the petitioner on the ground that it was difficult to believe that the petitioner did not receive notice from the Regional Settlement Commissioner, Bombay, to pay up the difference because the Regional Settlement Commissioner had constantly written to deceased Deva Govind at Rajkot address and further, that the power of attorney holder of the petitioner was educated even though the petitioner may have been uneducated. The said order of the Authorised Chief Settlement Commissioner was challenged by the petitioner in a revision application filed u/s 33 of the Displaced Persons (Compensation and Rehabilitation) Act, 1954, (hereinafter referred to as the ''said Act'') which was decided by the Secretary, Revenue Department of the Government of Gujarat on 18th October, 1979 and the order of the Authorised Chief Settlement Commissioner dated 25th May, 1976 and of the Regional Settlement Commissioner, Bombay'' dated 15th October, 1970, were set aside. However, while doing so, it was ordered that the said property should be given to the petitioner at the market price and that she shall not sell the property without the permission of the Collector-Cum-Settlement Commissioner, Rajkot for a period of 5 years and further that the property should be put to her own use.

Mr. P. M. Raval, the learned counsel appearing for the petitioner argued that no such conditions as were sought to be imposed in the impugned order could have been validly imposed in respect of the property which was put in an auction sale where the bid of Deva Govind, the deceased husband of the petitioner was accepted. Even the learned Assistant Government Pleader, Mr. Antani, appearing for the respondents fairly submitted that there was no provision under which such conditions could have been imposed by respondent No. 1. Mr. S. M. Shah, the learned advocate appearing for the respondent No. 3 who was subsequently added as a party submitted that while exercising the revisional Powers delegated to the State Government by virtue of Section 34, the Government may pass such orders in relation to the record and proceedings called for by it as in its opinion the circumstances of the case require u/s 33 of the said Act. Mr. Shah submitted that the conditions, which were imposed under the impugned order, are not inconsistent with any provision of the said Act or the Rules and since the petitioner did not abide by these conditions she was not entitled to get the benefit of the auction sale of the said property in favour of her husband Deva Govind.

u/s 20 of the said Act, it is inter alia provided that subject to the Rules made under the Act, any property may be transferred out of the compensation pool to a displaced person or any association of displaced persons or to any other person whether the property is sold by public auction or otherwise. Chapter XIV of the said Rules provides for the procedure for sale of property in the compensation pool and Rule 90 provides for the procedure for sale of property by public auction. Sub-rule (8) of Rule 90 provides for payment of a deposit by the highest bidder of the property and sub-rule (10) provides that he shall subject to the approval of the Settlement Commissioner or an officer appoint such bid for the purpose. Admittedly, Deva Govind was the highest bidder at the auction held on 9-2-1961 in respect of the said property and he had paid 10% of the purchase price as deposit. There is also no dispute about the fact that his bid for Rs. 10,500/was accepted by the Regional Settlement Commissioner, Bombay by his letter dated 7-2-1962, Intimation of the approval of the bid or its rejection is required to be given under sub-rule (11) to the highest bidder. Under sub-rule (14) of Rule 90, it is provided that if the auction purchaser does not deposit the balance of the purchase money within the period specified in sub-rule (11) or does not furnish particulars of his compensation application as specified in sub-rule (12) or if the net compensation admissible to the auction-purchaser is found to be less than the balance of purchase money and the auction-purchaser does not make up the deficiency as provided in sub-rule (13), the initial deposit made by the auction-purchaser under sub-rule (8) shall be liable to forfeiture and he shall not have any claim to the property. By order dated 15-10-1970 at Annexure ''C '', the Assistant Settlement Commissioner had cancelled the sale under Rule 90(14) and forfeited 10% earnest money deposited by Deva Govind on 2-1-1962. The order canceling the auction sale was passed after the death of the auction-purchaser. The Department had remained inactive for a long period from 1962 till 23rd October 1969 when the Regional Settlement Commissioner addressed a letter to Deva Govind asking him to pay Rs. 9450/either in cash or by way of associating claims within 15 days of the receipt of that letter. Such a demand was meaningless because Deva Govind Lal died on 27-2-1964. The reasoning of the Authorised Chief Settlement Commissioner that it was difficult to believe that the petitioner did not receive notice to pay up the difference because the Regional Settlement Commissioner had constantly written to Deva Govind at Rajkot address and the power of attorney holder of the petitioner Mr. Malik was not uneducated was rightly found to be totally unacceptable by the respondent No. 1. The power of attorney was executed in the year 1971 by the petitioner in favour of Mr. Malik and the fact that Mr. Malik was educated had nothing to do with the question whether the petitioner had been appropriately informed about the demand of paying the shortfall in respect of the property. The respondent No. 1 also rightly held that no valid notice was given to Deva Govind during his lifetime for paying up the shortfall. As a consequence, the order of the Authorised Chief Settlement Commissioner dated 25-10- 1976 and that of the Regional Settlement Commissioner, Bombay dated 15-10-70 were rightly set aside by respondent No. I by his order dated 18th October 1979. The necessary corollary of setting aside these orders would have been the revival of the auction purchase done by Deva Govind. By order dated 15-10-1970 passed under Rule 90(14), the Regional Settlement Commissioner had purported to cancel the auction sale in favour of Deva Govind and forfeited his deposit. Therefore since that order was set aside the position, which obtained prior to passing of that order revived and it was not open to the respondent No. 1 to add any new conditions to the terms and conditions, which were fixed at the time of conducting the auction sale. The petitioner became entitled to take the property on the same terms and conditions on which her late husband Deva Govind was declared to be the highest bidder of the property. Admittedly, the Regional Settlement Commissioner under his letter-dated 7-2-1962 accepted his bid. Therefore there was no scope for adding any new conditions after having set aside the order dated 15-10-70 of the Assistant Settlement Commissioner and the order dated 27th May, 1976 of the Authorised Chief Settlement Commissioner by which the order dated 15-10-1970 was up held and direction was given to dispose off the property. The reserve price of the property was fixed at Rs. 8,390/- in accordance with sub-rule (5) of Rule 90 and Deva Govind had bidden for the said property for Rs. 10,500 / at the auction held on 9-2-1961. Since that bid was accepted in accordance with sub-rule (10) of Rule 90 and intimation as required by sub-rule (11) was also given to Deva Govind there remained no further scope for fixing the price of the property again. In other words, on his bid being accepted, Deva Govind became entitled to get the property for a price of Rs.10, 500/- which he had bidden at the auction. Any attempt to substitute that price for the market price is not warranted by the provisions of Rule 90 of the said Rules laying down procedure for sale of property by public auction. At the said auction sale the auction purchaser was not subjected to any condition-banning sale of the property for a period of 5 years without previous permission of the Collector/ Settlement Commissioner nor does there appear to be any condition that the property should have been used by the auction-purchaser himself. When property is sold by public auction, such restrictions cannot be imposed unless authorised by law or unless agreed to at any time of such auction. Therefore the conditions, which have been added by the respondent No. 1 in his order dated 18th October 1979, are unwarranted and have been arbitrarily imposed. On setting aside the order dated 15-10-1970, the previous position revived and therefore the petitioner became entitled to take the property on the same terms and conditions on which it was auctioned in favour of her late husband Deva Govind. Therefore the conditions imposed under the impugned order will have to be set aside with a direction to make over the property to the petitioner on the same terms and conditions on which it was to be given to the auction-purchaser late Deva Govind in accordance with the procedure for sale of property by public auction contained in Rule 90 of the said Rules. Since the order dated 15-10-1970 by which the Regional Settlement Commissioner has cancelled the auction sale and forfeited the deposit was set aside and the position prior to that revived, the respondent No. 3 who has been added as a party in this petition could not have claimed any right in respect of the said property on the basis of any subsequent dealing in respect of the same property. The respondent No. 3 had never challenged the order of the respondent No. 1 by which the earlier order dated 15-10-1970 and the order dated 27-5-1976 were set aside. Under the above circumstances, the petition will have to be allowed by setting aside the conditions incorporated in the impugned order at Annexure F dated 18-10-1979 passed Corporation will have to release the said by the respondent No. 1 and directing that the property in favour of that party. In all other property being Evacuee Property No. 34 cases of doubt or dispute, the third party will situate at Limbdi in District Surendranagar have to go to the Court of law and establish its be transferred to the petitioner on the same right to recover possession of the property terms and conditions on which it was to be taken over by the Financial Corporation given to the auction purchaser late Deva Govind in accordance with the procedure for sale of property by public auction contained in Rule 90 of the said Rules. Rule is made absolute accordingly with no order as to costs.

Petition allowed