Statutory power survives absent rules; time can be extended under residuary power, but affected auction purchasers need hearing.

Where a statute confers substantive power to dispose of compensation pool property, that power remains exercisable even if rules have not yet been framed, unless rule-making is made a condition precedent; auction sale of the urban agricultural land was therefore not invalid on that ground. A residuary power under section 33 could also be used to extend the time for deposit of the balance purchase price, since enlarging time to meet subsequent circumstances was not a review of the earlier order. Relief under section 33, however, could not be granted without notice and hearing to subsequent auction purchasers who were directly affected, because natural justice required an opportunity of hearing before their interests were prejudiced.

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Issues: (i) Whether the Central Government could authorise disposal of urban agricultural land from the compensation pool by auction sale in the absence of framed rules; (ii) whether the authority exercising powers under section 33 had jurisdiction to extend the time granted for deposit of the balance purchase price; (iii) whether the order passed under section 33 was vitiated for want of notice and hearing to the subsequent auction purchasers.

Issue (i): Whether the Central Government could authorise disposal of urban agricultural land from the compensation pool by auction sale in the absence of framed rules.

Analysis: The statutory scheme empowered the Central Government and the authorities under the Act to provide compensation by sale or transfer of pool property. The relevant provisions conferred power to take measures for custody, management and disposal of the compensation pool and contemplated rules only as a regulating framework, not as a condition precedent to the exercise of the substantive power. In the absence of rules, the power did not become inoperative, and executive directions could validly regulate disposal of such property.

Conclusion: The auction sale was not illegal merely because no rules had been framed, and the challenge on that ground failed.

Issue (ii): Whether the authority exercising powers under section 33 had jurisdiction to extend the time granted for deposit of the balance purchase price.

Analysis: Section 33 conferred residuary power on the Central Government to pass such orders as the circumstances required, provided they were not inconsistent with the Act or rules. The initial order granting time with a default clause did not exhaust that power. The authority could take note of subsequent events and enlarge the time to mitigate hardship, and such enlargement did not amount to a review of the earlier order.

Conclusion: The authority had jurisdiction to extend time, and the High Court was wrong in holding otherwise.

Issue (iii): Whether the order passed under section 33 was vitiated for want of notice and hearing to the subsequent auction purchasers.

Analysis: The subsequent auction purchasers had a sufficient and direct interest because the grant of relief to the appellant would prejudice their position in respect of the property. Even though they had no vested right in the property merely as highest bidders, they were persons likely to be adversely affected by the decision on the section 33 petition and were therefore entitled to an opportunity of hearing.

Conclusion: The absence of notice and hearing offended natural justice, so the order under section 33 could not stand on that ground.

Final Conclusion: The appeal succeeded only in part. The finding invalidating the auction sale and the finding denying jurisdiction to extend time were set aside, but the matter had to go back for fresh consideration after notice and hearing to the affected auction purchasers.

Ratio Decidendi: Where a statute confers substantive power subject to rules, the power remains exercisable even if the rules are not yet framed, unless the statute expressly makes rule-making a condition precedent; and a residuary statutory power may be used to extend time or grant consequential relief if consistent with the Act, but only after complying with natural justice for persons prejudicially affected.

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