Tender conditions and earnest money forfeiture prevail where a bidder defaults and cannot rely on title objections.

Binding tender conditions governed the pre-confirmation stage of a public auction, and the highest bidder acquired no enforceable right until the bid was formally confirmed. Where the bidder failed to pay the stipulated 25% within time, the forfeiture clause in the tender terms applied. The court also held that a bidder who participated with knowledge of the tender conditions could not rely on Section 55 of the Transfer of Property Act, 1882, or alleged title defects or encumbrances, to avoid the contractual consequence. The earnest money deposit was therefore validly forfeited and no illegality or lack of jurisdiction was found.

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Issues: Whether the Housing Board was justified in forfeiting the earnest money deposit for non-payment of the amount required under the tender conditions, and whether the petitioners could invoke Section 55 of the Transfer of Property Act, 1882 to resist forfeiture on the ground of alleged defects in title or encumbrances.

Analysis: The tender notice and conditions constituted binding administrative instructions governing the pre-confirmation stage of the transaction. Under those conditions, the highest bidder acquired no enforceable right to the property until confirmation by the Vice-Chairman, and the bidder was required to pay 25% of the bid amount within the stipulated time. Condition 4 expressly provided for forfeiture where condition 2 was violated. Condition 11 embodied a caveat emptor clause, requiring bidders to satisfy themselves about the land before participating and barring post-bid objections. In that setting, the petitioners, having bid with knowledge of the tender terms and having failed to pay the required amount, could not rely on Section 55 of the Transfer of Property Act, 1882 or on alleged title defects to avoid the contractual consequence of forfeiture. The authority of the public body to forfeit earnest money in accordance with the tender terms was upheld.

Conclusion: The forfeiture of the earnest money deposit was held to be valid and no illegality or lack of jurisdiction was found.

Final Conclusion: The writ petition failed because the tender conditions controlled the parties' rights at the pre-confirmation stage and the petitioners' default attracted the forfeiture clause.

Ratio Decidendi: In a public auction governed by binding tender conditions, the bidder cannot resist forfeiture of earnest money for non-compliance by invoking pre-contractual title objections or Section 55 of the Transfer of Property Act, 1882, where the tender expressly makes such forfeiture part of the bargain.

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