Forfeiture of earnest money upheld where bidder missed the auction payment deadline and sought time after expiry.

Forfeiture of earnest money was treated as a lawful consequence where a successful bidder failed to pay the balance bid amount within the stipulated 90-day period fixed by the auction notice and sale-confirmation terms. The bidder sought further time only after expiry of that contractual timeline, and extending time then would have altered the auction conditions and could have prejudiced other participants. The challenge to the CBDT instruction was not pursued by a direct attack on the instruction itself, and the impugned action remained consistent with the published sale terms. No basis for writ interference was made out.

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Issues: Whether forfeiture of the earnest amount for failure to pay the balance bid amount within the stipulated time and refusal to extend time was illegal, arbitrary, or liable to be interfered with under writ jurisdiction.

Analysis: The successful bidder was expressly bound by the auction notice and the sale-confirmation terms to pay the entire bid amount within 90 days from confirmation, failing which the amount already deposited would stand forfeited. The bidder did not comply within the stipulated period and sought additional time only after expiry of the contractual timeline. Granting an extension at that stage would amount to varying the terms of the auction and could prejudice other bidders who participated on the stated conditions. The challenge to the CBDT instruction was also not pursued by any direct challenge to the instruction itself, while the impugned action remained consistent with the published terms of sale.

Conclusion: The forfeiture was upheld as a lawful consequence of breach of the auction and sale-confirmation conditions, and no ground for interference was made out.

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