1. By this writ petition under article 226 of the Constitution of India, the petitioner contended that pursuant to a sale notice (Annexure 1 to the writ petition) issued by respondent No.2, on behalf of respondent No.1, and published in the newspaper namely, ‘The Arunachal Times‘dated, 19th January, 2012 in respect of public auction of 7 Nos. of Tata Sumo vehicles, the petitioner participated in the public auction held on 27.1.2012 at 4.00 p.m. in the office chamber of the respondent No.2, and for the vehicles in item No.2 (TATA SUMO-TREKKER: AR01-C-3311) of the sale notice, he offered a price of Rs.3
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0,600 and for the vehicle in item No.3 (TATA SUMO-TREKKER: AR01-C-3313) of the sale notice, he offered a price of Rs.15,000. While participating in the public auction in respect of those two vehicles mentioned in item Nos. 2 and 3, he also deposited Rs.5,000 towards earnest money for each of the item. He was the only bidder for those two vehicles and, therefore, his offer was supposed to be accepted by the respondents but the respondent No.2 by a letter dated 21.2.2012 (Annexure 2 to the writ petition) intimated the petitioner that the price offered by him was not acceptable to the bank and, therefore, he was requested to collect the earnest money of Rs.5,000 each of those two items of vehicles.
The petitioner being aggrieved issued notice to the respondents to release the vehicles in his favour on receipt of the price offered by him since he was the single bidder and since there was no stipulation in the sale notice about any reserve price of the vehicles. The respondents, later on, published another sale notice dated 31.3.2012 in The Arunachal Times newspaper proposing to sale 4 vehicles including that of the two vehicles for which the petitioner participated in the public auction. The petitioner, therefore, prayed for directing the respondents to release the Tata Sumo Trekker No.AR01-C-3311 and Tata Sumo Trekker No. AR01-3313 on receipt of the price offered by the petitioner in the auction sale held on 27.1.2012 and also to set aside and quash the re-advertisement dated 31.3.2012.
2. Respondents contended that the vehicles were put in public auction for sale with a view to obtain maximum price for the purpose of liquidating the outstanding dues of the borrower/defaulter and no reserve price was mentioned in the notice since it was not mandatory. Public auction was invited with a view to protect the interest of defaulting borrowers who had taken loan from the bank and purchased the vehicles. The approved valuer of the bank fixed reserve price of the vehicles which was kept in the official record and that the approved valuer of the bank fixed a price of Rs.96,000 for each of those vehicles for which the petitioner participated in the auction bidding. Since the price quoted by the petitioner was abnormally below than that of the price valued by the bank authority, the offer made by the petitioner could not be accepted and the petitioner was immediately informed by writing letter dated 21.2.2012 (Annexure 2 to the writ petition). No fundamental or legal right of the petitioner was infringed by rejecting the offer made by the petitioner and the writ petition, therefore, is without merit and liable to be dismissed.
3. Heard learned counsel, Mr. T. Son for the petitioner and learned counsel, Mrs. S. Nag for the respondents.
4. Points to be decided may be summarised, thus:
I. Whether in a sale notice under public auction, reserve value of the property is mandatory.
II. Whether the owner who issued the sale notice for public auction is bound to sale the property put in auction, at any price whatever is offered by a bidder.
5. On going through the writ petition and the counter affidavit filed by the respondents with annexed documents and upon hearing learned counsel of both side, this court is of the view that there is no legal compulsion for the owner to quote the reserve price in the sale notice intending to sale in public auction. It would have been better for the owner to quote the reserve price and had it been so, an intending bidder would make a choice before participation in the auction bid. But that does not mean that whatever price is offered by a bidder is to be accepted by the owner only because no reserve price was mentioned in the notice. Admittedly, in the case at hand, no reserve price was mentioned in the sale notice. The case of the respondents is that, out of the seven vehicles put in auction, only vehicle in item No.1 could be sold out because the price offered by a bidder for that vehicle was above the reserve price of Rs.96,000 and the vehicle in item No.1 (AR01-C-3824) was sold for Rs.1,10,000. Other vehicles could not be sold since the price offered was abnormally less than the price valued by the Valuer of the bank. Be that as it may, I find no justification in the submission made by the learned counsel of the petitioner that the respondent bank is bound to dispose the vehicles at the price offered by petitioner. It is definitely within the satisfaction of the owner as to whether he will part with the property for the price offered by the bidder or not. The respondents cannot be compelled to part with the property for the price offered by the petitioner though in the consideration of the respondent it was absolutely below the expected value. Admittedly, the vehicles have been put in auction by the bank to adjust the sale proceeds towards liquidation of the loan amount. Under such circumstances, the object of conducting public sale is to secure as much price or revenue as possible to redeem the debt of the debtor. The respondents, therefore, cannot be legally compelled to sale the vehicles at the price offered by the petitioner. Non-mention of the reserve price of the particular vehicle in the sale notice cannot be a ground to direct the respondents to accept any price offered by the petitioner. The petitioner is, however, entitled to get back the earnest money deposited by him which the respondent shall release at once.
6. The writ petition, therefore, stands dismissed. In the circumstances, parties to bear their own cost.