Case Note & Summary
The petitioner, M/s. Rakesh Traders, a licensed trader in APMC, Mysore, was originally allotted site No.369 in 'A' block of the APMC Yard under a lease-cum-sale agreement dated 05.07.2007. Subsequently, the APMC issued a notification on 18.08.2012 for auction of corner sites by way of lease-cum-sale. The petitioner applied on 07.09.2012 with earnest money deposit and participated in the public auction held on 10.09.2012 for site No.261 in Block 'A'. The petitioner emerged as the highest bidder with a bid amount of Rs.47,50,000/-. This was confirmed by a communication dated 13.09.2012 (Annexure-F), which called upon the petitioner to pay the balance amount of Rs.11,20,900/- within seven days. The petitioner deposited the said amount. However, the third respondent, the Agricultural Produce Market Committee, issued a notice dated 21.08.2014 (Annexure-L) cancelling the allotment of the corner site to the petitioner. The petitioner challenged this cancellation by way of a writ petition under Articles 226 and 227 of the Constitution of India. The court found that the impugned notice of cancellation was issued without any show cause notice or opportunity of hearing to the petitioner, and no reasons were assigned for the cancellation. The court held that such cancellation without affording an opportunity of hearing is arbitrary and violative of principles of natural justice. The court quashed the impugned notice and directed the respondents to restore the allotment in favour of the petitioner and to execute the lease-cum-sale agreement in respect of the site in question within a period of four weeks from the date of receipt of the order.
Headnote
A) Administrative Law - Principles of Natural Justice - Audi Alteram Partem - Cancellation of Allotment - The Agricultural Produce Market Committee cancelled the allotment of a corner site to the petitioner without any show cause notice or opportunity of hearing, despite the petitioner being the highest bidder and having paid the required amount. The court held that such cancellation without notice is arbitrary and violative of natural justice. (Paras 1-5) B) Contract Law - Lease-cum-Sale Agreement - Cancellation - The petitioner had been allotted a site under a lease-cum-sale agreement and later successfully bid for a corner site in a public auction. The cancellation of the allotment without any prior notice or opportunity to show cause was set aside as illegal. (Paras 1-5)
Issue of Consideration
Whether the cancellation of allotment of a corner site to the petitioner by the Agricultural Produce Market Committee without issuing a show cause notice or affording an opportunity of hearing is arbitrary and violative of principles of natural justice.
Final Decision
The writ petition is allowed. The impugned notice of cancellation dated 21.08.2014 (Annexure-L) is quashed. The respondents are directed to restore the allotment in favour of the petitioner and to execute the lease-cum-sale agreement in respect of the site in question within a period of four weeks from the date of receipt of the order.
Law Points
- Principles of natural justice
- Audi alteram partem
- Cancellation of allotment without notice is arbitrary
- Lease-cum-sale agreement
- Public auction
- Highest bidder rights
