- (1.) S. N. Shukla, Member. This reference has been made by the Commissioner, Azamgarh Division in Revision No. 10/a-93. The fact of the case briefly stated are that the land belonging to the father of the revisionist was auctioned on 2- 12-92 for the recovery of bank dues. The bid of Rs. 60,000 by the revisionist was highest. He deposited 1/4 amount on the same day and the remaining amount was deposited on 14-12-92 within the prescribed period. Meanwhile, the Opposite Parties No. 3 to 10 in the revision moved an application dated 11-12-92 for cancelling the auction due to various irregularities mentioned in their application. The SDO vide his order dated 18-12-92 cancelled the auction. The revisionists application dated 21-12- 1992 to revoke the order dated 18-12-1992 was also rejected by the SDO on 22-12-92. The revisionist thereupon filed this revision before the Commissioner. The Commissioner vide his order dated 12-7-94 has made a recommendation for cancelling the orders dated 18-12-92 and 22-12-1992 on the ground that after the auction the SDO had no jurisdiction to hear objections against it and only the Commissioner was empowered to do so.
(2.) I have heard the learned Counsel for both the sides and perused the records. The learned Counsel for the revisionist supporting the reference has contended that since the auction money was deposited within the prescribed time, the SDO had no option left but to confirmed the sale as provided in Rule 295-J of the UPZA and LR Rules. Moreover, since no application under Rule 285-H or 285-I was made, the objection of the opposite parties was barred by Rule 285-K and the only remedy for them was to approach the Civil Court. In support of this contention the learned Counsel has placed reliance on the decision of Allahabad High Court in Hari Singh v. State of U. P. , 1993 (11) LCD 946. Para-8 of the judgment in this case is reproduced below: "rule 285-J provides that if no such application as mentioned in Rule 295-H or Rule-I has been made after the expiry of thirty days from the date of sale, or if such application has been made and has been rejected by the Collector or the Commissioner, then the Collector shall pass an order confirming the sale after satisfying himself that the purchase of land in question by the bidder has not been done in contravention of the provisions of Section 154. This rule clearly goes to show that once the objection made by the objector has been dismissed or if no such objection has been made then the Collector has to confirm the sale if he is satisfied that the provisions of Section 154 have not been contravened. " On the other hand the learned Counsel for the opposite parties has contended that the reference by the Commissioner is misconceived. The land which was already sold to, and mutated in the name of, the opposite parties was fraudulently put to auction and only the sons of the depositor participated in it. The other land of the faulter was not put to auction and no steps were taken for recovery against the other co-defaulter. Thus, the auction was collusive and the SDO was perfectly right in cancelling it on the basis of the irregularities mentioned in the order of the SDO dated 18-12-92. It was not necessary for the SDO to hear the revisionist before cancelling the auction. In support of his contention the learned Counsel has relied on the decisions of Allahabad High Court in Raghunandan Prasad v. Board of Revenue and others, 1987 RD 380, and Daya Ram Agarwal v. Board of Revenue and others, 1989 RD 249. In the case of Raghunandan Prasad which is on all fours with the present case, the Addl. Collector had cancelled the auction and rejected the highest bid of the petitioner on a complaint that the property was undersold. Mr. Justice K. N. Mishra ruled as follows:- "it is thus amply clear that the highest bidder would acquire right, title or interest in the property only after the confirmation of sale and till them he would not acquire any interest in the property merely on his depositing the amount of highest bid offered by him in the auction sale. The mere fact that the Assistant Collector, who conducted the auction sale had accepted the deposit of highest bid amount made by the petitioner, did not conclude the sale, which would be complete only after an order regarding confirmation of sale had been passed by the Collector. Since no order confirming sale was passed by the Respondent No. 3 and as such the auction sale was not complete and the petitioner cannot be said to have acquired any right, title or interest in the property merely on the ground of his depositing the amount of bid offered by him. Thus, in my opinion it was not necessary for the Collector to give notice to the petitioner before refusing to accept the bid offered by him as he could not have any say in the matter at the stage, and the order of re-auction appears to have been validly passed. " Likewise in the case of Daya Ram Agarwal also the highest bidder had challenged the order of the Collector for re-auction. It was held that a bidder at previous auction which has been rightly or wrongly set aside prior to its confirmation is not entitled to object against re-auction. The learned Judge observed: "the Collector was the authority to hold and conduct be auction and either he or any one appointed by him could have conducted the auction. If the auction would have been held by him, his acceptance would be final. But if it is held by an officer appointed by him, acceptance by him could not be final and only authority which could be delegated is to conduct the sale. The limited delegation could not make him Collector or confer all the powers of Collector in the matter. The Collector's powers to accept or not to accept the bid are intact and so long the bid was not accepted by him, no concluded contract could come into existence. Merely because bid of a person being the highest is accepted by Sale Officer no concluded contract came into existence. The Collector had jurisdiction to reject a particular bid on the ground that it was inadequate notwithstanding it was accepted by his delegate for the purposes of only conducting the sale. The bid not having been accepted, the property could have been put to re-auction. In these circumstances there was no delegation to confirm the first sale merely because the petitioner's bid was accepted by the Sale Officer. "
(3.) FROM the two rulings cited above it is clear that the right of the Collector to reject the highest bid without notice to the bidder is not affected by Rule 285-J and the contention that if no application under Rule 285-H or Rule 285-I has been made within the prescribed time the Collector cannot cancel the auction is not tenable. The submission of the learned Counsel for the revisionist that these rulings are against the Rules is not correct. The Rules do not prohibit the Collector from cancelling the auction as per the terms and conditions of the auction if he finds that the auction was collusive or vitiated by material irregularities. As observed by the learned Judge in the case of Raghunandan Prasad. The stage of an application under Rule 285-H or 285-I, and the confirmation of sale thereafter, arises only after the acceptance of highest bid. The rejection of the highest bid by the Collector even before the filing of applications under Rule 285-H or 285-I is, therefor, not barred by Rule 285-J. The ruling cited by learned Counsel for the revisionist in respect of Rule 285-J is not applicable to cases relating to non acceptance or rejection of the highest bid by the Collector. Rule 285-J is regarding the confirmation of the sale and it does not by implication take away the power of the Collector to reject the highest bide for any valid reason prior to its acceptance. Moreover, it is debatable whether the use of word "shall" in Rule 285-J is mandatory or directory. But this is not the point at issue in this case. In fact, the decision in Raghunandan Prasad's case was cited by the Petitioner in the case of Hari Singh, but was held as inapplicable as the facts in the two cases were different. In Hari Singh's case the defaulter had challenged auction in favour of the highest bidder on the ground that the bide amount was grossly inadequate. The petition was held not maintainable on the ground of the petitioner having not availed the alternative remedy under Rule 285-I. It was not a case of cancellation of the highest bid by the Collector before its acceptance, such before its confirmation under Rule 285-J.;