LUCKY STAR ESTATES I PRIVATE LIMITED Vs. DELHI DEVELOPMENT AUTHORITY

JUDGEMENT

(1.) This suit for recovery of Rs. 1,10,000/ has been filed by the plaintiff in the following circumstances.

(2.) The defendant, the Delhi Development Authority, in its capacity as a statutory body and in discharge of its public function held an open auction on 25-7-1974 for the sale of cinema plot No. 70, Nehru Place, Kalka Ji, New Delhi for grant of perpetual lease-hold right. The relevant conditions of auction were that-the highest bidder had to pay 25% of the old amount towards the earnest money in cash or in the form of bank draft at the fall of the hammer. The balance amount of 75% had to be paid within 120 days from the date of issue of communication for acceptance of the bid. The highest bidder had to construct cinema house on the plot in question within a period of three years from the date of communication of acceptance of the bid, and the highest bid had to be accepted by the defendant or its officer who had been authorised to do so. The plaintiff being the highest bidder at the auction deposited a sum of Rs. 3,75,000.00 being 25% of the bid amount. The acceptance of the bid was not communicated to the plaintiff" for a fairly long time and thus the plaintiff sent reminder on 19-3-1975 requiring the defendant to communicate to the plaintiff acceptance of the highest bid offered by the plaintiff in the said open auction. The plaintiff also mentioned in the said letter that all preliminaries relating to the building plans for the cinema plot had been completed by the plaintiff and the plaintiff was eagerly awaiting the receipt of the formal acceptance and he was too keep to make the balance payment of Rs. 11.5. lacs. Inpite of the said letter, the defendant did not convey wither acceptance or rejection of the bid. Again on 27-6-1975, the pintiff informed the defendant that in view of the elapse of about 11 months the plaintiff was justified in going a head with the construction plans. It had also sent a cheque for Rs. 11.5. lacs towards the balance payment of 75%.

(3.) The cheque was not encashed by the defendant and on 22-8-1975, the defendant sent back the cheque saying that the same would be accepted only after the issue of the demand letter from the defendant. The plaintiff again wrote letter dated 18-9-1975 to the effect that since the bid had not been rejected, the plaintiff was entitled to assume that the same has been accepted and as such the plaintiff was unable to understand the reason for the return of the cheque. Finally after a period of one year and three months from the public auction, the defendant vide its letter dated 13/14 the November, 1975 informed the plaintiff that the highest bid of the plaintiff for the purchase of the plot had not been accepted. The plaintiff was further informed that the action for refund of earnest money deposited was being taken shortly. In spite of that, the amount of Rs. 3.75 lacs deposited by the plaintiff was retained by the defendant till 18-2-1976 when the cheque for the said amount was sent to the plaintiff with a covering letter of the same date. No reason for explanation of any kind was given in the said letter or otherwise as to why such huge slim of Rs. 3.75 lacs was detained further by the defendant from 13/14th November, 1975 till 18-2-1976. The defendant also did not furnish any explanation for the delay of 22 months in rejecting the bid and refunding the earnest money paid by the plaintiff.