Statutory recovery of auction bid amounts upheld despite no executed Article 299 contract.

Amounts due from successful auction bidders for toddy shops were recoverable as arrears of land revenue under section 28 of the Abkari Act, because the statutory scheme treated a bidder as a grantee of the privilege once the bid and consideration conditions were met. A formally executed contract under Article 299 of the Constitution was not a prerequisite to enforcement where the liability arose directly from the statute. Section 18A(2) supported this position by treating the bidder as a grantee even before receipt of the licence. The recovery proceedings were therefore valid despite the absence of an executed contract.

---

---

Issues: Whether amounts due from successful auction bidders for toddy shops could be recovered under section 28 of the Abkari Act despite no contract having been executed in conformity with Article 299 of the Constitution of India.

Analysis: Section 28 authorised recovery of all amounts due to the Government from a grantee of a privilege or on account of any contract relating to Abkari revenue as arrears of land revenue. The statutory scheme showed that the status of a grantee could arise upon the grant of the privilege and payment of the stipulated consideration, and it was not necessary that a formally executed contract should already exist. Section 18A(2) treated a bidder as a grantee even before the licence was actually received. The obligation to pay the balance of the auction amount therefore rested on the statutory conditions of the grant and not solely on a formal contract under Article 299.

Conclusion: The amounts were recoverable under section 28 of the Abkari Act notwithstanding the absence of an executed contract under Article 299, and the contention of the appellants failed.

Final Conclusion: The statutory scheme governing the auction created an enforceable liability for the balance of the bid amount, and the recovery proceedings were valid.

Ratio Decidendi: Where a statute makes a bidder a grantee of a privilege and provides for recovery of amounts due as arrears of revenue, enforcement does not depend upon the execution of a formal contract under Article 299.

---