Chandigarh, June 17, 2022: In an auction conducted by Haryana Shehri Vikas Pradhikaran, Panchkula (HSVP), the Punjab and Haryana High Court has approved the auction policy which provided for the non-disclosure of the reserved price for confidential reasons and to ensure transparency in the process of allotment via e-auction.
The Bench of Justices Amol Rattan Singh and Lalit Batra held, “As regards the basic issue of the higher bid not being accepted as it did not match the undisclosed reserved price, again we would find no reason to agree with the petitioners in view of the policy as above, to the effect that the reserved price is not disclosed for confidential reasons and to ensure transparency in the process of allotment via e-auction…”
Through these petitions, the essential question that arose for the Court’s consideration was whether the petitioners being the highest bidders in the respective auctions for the plots in question, can be denied allotment of the plots on the ground that the bids did not match the price reserved by the respondents even though the said price was not disclosed at the time that the bid was invited or prior to that, in the advertisement itself.
The case of the respondents was that as per the auction policy, the reserve price was never disclosed for reasons of confidentiality and to ensure that there was no collusion at any level between the prospective bidders and any officials of the respondent authority itself, or any other persons.
The counsel for the petitioners submitted that the counter offers having been made well beyond seven days as was stipulated in the policy for making such counter offers, it cannot be said to be a valid offer and consequently the bids of the petitioners should have been accepted.
The Court did not agree with the said contention of the petitioners’ counsel for the reason that firstly, it was not the case of the petitioners herein that any other person was allotted the plots in question in the meanwhile or that any other person made an offer prior to the counter offer made to the petitioners.
Further, as regards the basic issue of the higher bid not being accepted as it did not match the undisclosed reserved price, the Court did not agree with the petitioners in view of the policy to the effect that the reserved price is not disclosed for confidential reasons and to ensure transparency process of allotment via e-auction.
The Bench added that even malafides cannot be attributed to the respondents in view of the fact that a counter bid was made to the petitioners to match the reserved price and therefore the petitioners cannot be heard to say that the rejection of their bids is only to favour any other persons.
At this stage, one of the writ petitioners submitted that given reasonable time, the petitioner would be willing to take up the counter offer of the respondents and pay the difference between the highest bid and the reserved price.
To this submission, the respondent submitted that even if that concession was to be granted to the petitioner, as the plot in question was not thereafter put to any subsequent auction process, it cannot be without interest and that too only if the court was to allow this petition in view of the circumstances.
Considering these submissions, the Court observed that the objection was fair and therefore upon the petitioner paying the differential between the highest bid offer made by her and the reserved price fixed by the respondents alongwith interest at the rate applied to savings bank accounts in the State Bank of India, running from the date that the counter offer was made till the date of actual payment, it was held that the plot in question would be allotted to the said petitioner with all other terms and conditions thereof being as per the auction process.
Also, it was observed that that the bids in all such cases were made on a base price settled by the respondent authority which was not the reserved price; and the Court found nothing wrong with the policy in view of the objective to be achieved by it, especially with a counter offer to be first made to the highest bidder.