2003 (12) TMI 648 - SC - Indian Laws

Supreme Court Affirms High Court Decision on Illegal Auction and Lease, Dismissing Appeal for Lack of Possession.

Bahadursinh Lakhubhai Gohil Versus Jagdishbhai M. Kamalia And Ors

The SC dismissed the appeal, affirming the HC's judgment that the respondent-Corporation's actions were illegal. The HC quashed the incorporation of ... Validity of the incorporation of the name of respondent No. 7 in the municipal register - auction and subsequent actions taken by the respondent-Corporation - HELD THAT:- It is not in dispute that the property in question had vested with the respondent-Corporation. The respondent-Corporation, therefore, could grant a lease in respect of the premise in question in terms of Section 79 of the Bombay Provincial Municipal Corporation Act, 1949 which stands extended to Gujarat. As order in writing could have been issued cancelling the allotment and forfeiting the amount of ₹ 270 but once it is held that the said letter dated 19.2.1952 was a conditional one, a fortiorari upon Shri Vajubha's failure to deposit the amount, the allotment stood cancelled. Furthermore, it is not in dispute that for the purpose of demise of a premise for a period exceeding one year, a registered document was required to be executed. In absence of execution of such a registered deed, no title could have passed in favour of the auction purchaser. The statutory requirements for grant of lease must be fulfilled so as to confer a legal right on the property upon the auction purchaser. As the statutory conditions, as contained in Section 79 of the Act as also Section 17 of the Indian Registration Act, were not complied with, there cannot be any doubt whatsoever that Shri Vajubha did not derive any title by reason of said auction or otherwise. In any event, the statutory authorities are bound to pass orders in writing. If possession of the plot had been delivered, the respondent - Corporation was bound to prepare document in respect thereof wherefor at least a receipt was required to be obtained from the auction purchaser showing that such possession had been delivered. If the possession had been delivered, the date on which the same was done could have been found out from the records of the municipal Corporation. As noticed by the High Court, no document exists. Even no noting in the file to that effect has been made. Only because an Officer in one of the correspondence had mentioned that possession had been delivered, the same, in our opinion, as has rightly been held by the High Court, could not have been accepted as a sacrosanct. Furthermore, there was absolutely no reason as to why only a few weeks before the purported transfer made in favour of the appellants herein the respondent No. 7 would file two applications praying for entering his name in the lease register and showing his readiness and willingness to deposit a sum of ₹ 90. If the contention of the said respondent was to be accepted, he would have pleaded acquisition of title by adverse possession as also waiver of this aforementioned sum of ₹ 90. It is also well-settled that if any decision is taken by a statutory authority at the behest or on the suggestion of a person who has no statutory role to play, the same would be ultra vires. It is, therefore, not a case where the High Court can be said to have committed an error in entertaining the public interest litigation. In our opinion, it has rightly been held that by reason of the impugned order, public interest has been given a complete go-by and a valuable public property was doled out at the behest of those who are duty bound to protect the same. We, therefore, are of the opinion that as substantial justice has been done, it is not a fit case where this Court should exercise its discretionary jurisdiction under Article 136 of the Constitution of India. This appeal is, therefore, dismissed without any order as to costs. Issues Involved:1. Legality of the incorporation of the name of respondent No. 7 in the municipal register.2. Validity of the auction and subsequent actions taken by the respondent-Corporation.3. Public interest and the role of statutory authorities.4. Procedural fairness and the right to be heard.Summary:Issue 1: Legality of the Incorporation of the Name of Respondent No. 7 in the Municipal RegisterA Public Interest Litigation (PIL) was filed questioning the action of the respondent-Corporation and its Chairman of the Standing Committee regarding the incorporation of the name of respondent No. 7 in the municipal register. The High Court quashed the impugned order dated 30th July 1997 and Resolution No. 185 passed by the Standing Committee on 25th July 1997, declaring them illegal and unjust. The High Court directed the deletion of the names of the legal heirs of late Shri Vajubha from the lease register and prohibited any lease agreement with them.Issue 2: Validity of the Auction and Subsequent Actions Taken by the Respondent-CorporationThe auction for Plot No. 2557 was held on 7.11.1951, and Shri Vajubha was the highest bidder. However, he failed to deposit the full amount within the stipulated time, leading to the forfeiture of the allotment. The High Court found that no possession was delivered to Shri Vajubha, no lease deed was executed, and the plot remained open and unused. The statutory requirements for granting a lease were not fulfilled, and thus, no title passed to Shri Vajubha or his successors.Issue 3: Public Interest and the Role of Statutory AuthoritiesThe High Court held that the respondent-Corporation acted against its own interest by passing the impugned order without considering the value of the land, which was approximately one crore. The Councillors, as holders of public offices, were bound to act as trustees of the Corporation. The PIL was deemed maintainable as the writ petitioners had locus standi.Issue 4: Procedural Fairness and the Right to be HeardThe appellant argued that the High Court erred in passing the judgment without hearing him. However, the Supreme Court noted that the appellant was given notice but chose not to appear before the High Court. The Supreme Court, after hearing the counsel at length, concluded that substantial justice had been done and dismissed the appeal without any order as to costs.Findings:- The property in question vested with the respondent-Corporation, and the statutory requirements for granting a lease were not met.- The High Court's findings that no possession was delivered and no lease deed was executed were upheld.- The impugned order was passed based on a lawyer's opinion without considering the legal questions raised in the PIL.- The Supreme Court found no error in the High Court's decision to entertain the PIL, as public interest was compromised by the impugned order.- The appeal was dismissed, affirming the High Court's judgment.