S. Muthukrishnan v. The Commissioner HR & CE Department Nungambakkam High Road Chennai – 600 034

O R D E RThe prayer in the writ petition is to quash the auction held on1.2.2008 pursuant to the tender-cum-auction notice dated 31.12.2007and the consequential letter of the third respondent dated 8.10.2009with a further direction to the respondents to refund the EMD amountof Rs.10 lakhs paid by the petitioner on 1.2.2008 and the depositamount of Rs.50,11,600/- made on 4.2.2008 with interest at 24% perannum within a stipulated time.2. The case of the petitioner is that the land measuring 4.84acres in S.Nos.2750/1 (3.58 acres), 2750/2 (0.71 acre) and 2751 (0.55acre) in Ward No.3, Block No.75 is owned by Arulmigu VaradarajaPerumal Temple, Thirupathiripuliur, Cuddalore District. Based on theorder passed by the Division Bench of this Court in Writ AppealNo.3861/2003, dated 16.11.2007, tender-cum-auction notice for thesale of the said lands was issued by the third respondent fixing theupset price at Rs.2 crores. It was indicated in the auction noticethat the said land can be utilised for construction of factory orcommercial complex or hotel and the sealed tenders are to besubmitted before the Assistant Commissioner, Hindu Religious &Charitable Endowment, Sub-Jail Road, Cuddalore-1 on 29.1.2008between 10 a.m. and 12.30 p.m., and the auction was ordered to beconducted on 1.2.2008 at 1 p.m. The cost of the tender form was fixedat Rs.5,000/-. 3. According to the tender conditions, a sum of Rs.10 lakhs byway of Demand Draft drawn in favour of the Executive Officer of thetemple has to be enclosed by the participants and the successfultenderer has to pay 10% of the auction/bid amount within three daysfrom the date of auction, and on receipt of the communication fromthe third respondent, the balance amount has to be paid within thirtydays from the date on which the Commissioner, Hindu Religious &Charitable Endowment has to sanction and approve the successful bidas per clause-9 of the tender conditions. It is stated in conditionNo.10 that if the above condition is not complied with, the depositamount already made will be forfeited and will further consequences.Since wide publicity was made in the daily newspapers for the thesaid auction, several persons participated and the petitioner's bidamount having been the highest bid, i.e. Rs.5,01,16,000/- (RupeesFive Crores One Lakh and Sixteen Thousand only), the petitioner wasdeclared as the highest bidder by the third respondent on 1.2.2008. 4. According to the petitioner, he participated in the auction,under the impression that he can construct a commercial complex inthe said place and lease out the same to various persons and he alsoobtained commitments from third parties to raise huge amount to thetune of Rs.5,01,16,000/-. Apart from submitting the Demand Draft forRs.10 Lakhs towards EMD as per condition contained in Clause-9, thepetitioner being declared as successful bidder he paid Rs.50,11,600/- https://hcservices.ecourts.gov.in/hcservices/ representing 10% of the bid amount on 4.2.2008 i.e. within thestipulated period of three days from the date of auction, which wasconducted on 1.2.2008. The third respondent also issued the receiptfor the said amounts. The petitioner having deposited the saidamounts, as he being declared as highest bidder, he was expectingorders of confirmation after getting permission from the firstrespondent. However, no intimation regarding confirmation of auctionin favour of the petitioner was received even after one year and sixmonths. The petitioner visited the office of the third respondentseveral times, who in turn informed that the papers have been sent tothe first respondent and confirmation order will be issued afterreceiving the permission from the first respondent and thepetitioner has to pay the balance bid amount on receiving the orderof confirmation. According to the petitioner he had made commitmentsto third parties for the construction of commercial complex and thematter being delayed unduly and the petitioner having parted withhuge amount to the tune of Rs.60,11,600/-, he was put to seriousfinancial problems.5. The petitioner having waited for more than one and half yearsand due to the commitments to the third parties given by thepetitioner and the same could not be honoured due to undue delay ingetting the auction confirmed, he has submitted a representation on19.8.2009 and requested the respondents to cancel the public auctionfor the sale held on 1.2.2008 and the EMD and the initial depositamount made by the petitioner may be returned to the petitioner with24% interest from the date of payment, namely, 1.2.2008 and 4.2.2008respectively within fifteen days. The third respondent after thereceipt of the petitioner's letter dated 19.8.2009, sent acommunication on 8.10.2009, wherein it is stated that the firstrespondent by his letter dated 27.9.2009 confirmed the auction infavour of the petitioner and the petitioner was directed to remit thebalance amount within 30 days and execute the sale deed. 6. In the said letter of the third respondent, it is furtherstated that there is no time limit prescribed to get the confirmationof auction from the first respondent and therefore, the petitionerhas to accept the confirmation and the reason given by the petitionerfor withdrawing from the auction through letter dated 19.8.2009cannot be accepted. 7. On 5.11.2009 after the receipt of the said communication ofthe third respondent, the petitioner sent a representation to therespondents and stated that the confirmation appears to have beengranted by the first respondent in his order dated 27.9.2009 andbefore even communicating the order of confirmation i.e. as early ason 19.8.2009, the petitioner has offered to withdraw from the auctionand prayed for return of the EMD as well as initial deposit and inspite of the said representation, the third respondent issued theorder on 8.10.2009, the petitioner has filed this writ petition with https://hcservices.ecourts.gov.in/hcservices/ the above said prayer on the ground that in the auction held, thehighest bid of the petitioner having not been confirmed by the firstrespondent as per the tender conditions in spite of more than one andhalf years, the petitioner submitted the representation to withdrawhis offer and before confirming the auction in favour of thepetitioner is entitled to withdraw from the auction proceedings andthe respondents cannot compel the petitioner to accept theconfirmation order, which was communicated to the petitioner longafter the withdrawal of the petitioner's auction proposal. Thepetitioner having opted to withdraw from the auction beforeconfirmation, the respondents are bound to refund the amount which hehad already deposited with 24% interest. There is unreasonable delayon the part of the respondents in confirming the auction andtherefore, the huge amount deposited by the petitioner, which wasraised through various sources get locked and therefore, thepetitioner submitted his offer to withdraw and prayed for refund ofthe auction already paid with 24% interest.8. The first respondent filed a counter affidavit by statingthat as per Section 34 of the Hindu Religious and CharitableEndowments Act, 1959, the first respondent can give sanction onlywith the previous approval of the Government. The writ petitionerhaving taken part in the public auction after accepting of theconditions cannot now seek cancellation of public auction and therespondents are not concerned with the alleged contractualobligations of the writ petitioner with private parties and the writpetitioner kept quiet till August, 2009 with regard to the highestbid and after knowing the clearance given by the State Government,the writ petitioner wrote a letter to the third respondent about hisintention to withdraw from the offer and also to refund the depositamount. As per condition No.9 contained in auction notice, if thebalance amount is not deposited within thirty days from the date ofconfirmation of auction, the EMD and the initial deposit will have tobe forfeited and if in the subsequent tender, the highest bid amountis lower than the previous bid, the respondents can claimdifferential amount and the same can be recovered from the previoushighest bidder/petitioner.9. The third respondent filed a separate counter affidavit bystating that the public auction sale was confirmed by the Governmentby issuing G.O.Ms.No.184, Tamil Development, Religious & InformationDepartment, dated 15.7.2009 and thereafter, the first respondent sentan internal communication to the third respondent on 27.9.2009 andafter the same being received by him on 6.10.2009, the petitioner wasinformed about the confirmation of sale by the first respondent, byletter dated 8.10.2009 and directed the petitioner to deposit thebalance amount within thirty days, failing which the initial depositmade will be forfeited. The petitioner without depositing the balancesale price, has chosen to file this writ petition challenging theauction with consequential prayers. According to the third https://hcservices.ecourts.gov.in/hcservices/ respondent, there is no provision for the refund of the deposit withinterest as claimed by the petitioner. The temple is in huge arrearsof payment of tax and other dues to the Government and the templealso incurred huge expenses to the tune of Rs.1.5 lakhs forconducting auction on 1.2.2008.10. Mr.B.Gnanadesigan, learned Senior Counsel appearing for thepetitioner submitted that admittedly auction was not confirmed infavour of the petitioner and no communication was sent to thepetitioner before withdrawal of offer made by the petitioner on19.8.2009 and the third respondent issued a communication only on8.10.2009 and informed the petitioner that the first respondent hasgranted permission for confirmation on 27.9.2009 and the petitionerhaving withdrawn the offer, the respondents are bound to refund theamount already deposited by the petitioner and there being delay ofmore than one and half years, the respondents are bound to return theamount with interest. In support of his contention, the learnedSenior Counsel for the petitioner relied on Section 5 of the ContractAct and following decisions.1) AIR 1947 MAD 366 (Somasundaram Pillai v.ProvinialGovernment of Madras)2) AIR 1963 AP 110 (Raghunandhan v. State of Hyderabad)3) AIR 1963 PAT 433 (Abdul Rahim Khan v. Union of India andOthers)4) 1969 (3) SCC 146 (Union of India and Others vs. Messrs.Bhim Sen Walaiti Ram)5) AIR 1975 MAD 292 (State vs. Ranganatham Chettiar)6) AIR 1978 ORISSA 41 (Sri Durga Saw Mill v. State of Orissaand Others)7) AIR 1995 AP 362 (M/s.Krishnaveni Constructions v. TheExecutive Engineer, Panchayat Raj, Darsi and Others)8) AIR 2000 SC 3505 (State of Kerala and Others vs.V.Narayana Pillai (dead) by L.Rs. And Others)9) 2007(2) SCC 624 (Yogesh Mehta vs. Custodian Appointedunder the Special Court and Others)11. Relying on the abovesaid decisions, the learned SeniorCounsel for the petitioner prayed for allowing the writ petition forrefund of the amounts with appropriate interest as may be decided bythis Court. https://hcservices.ecourts.gov.in/hcservices/

12. Mr. T.Chandrasekaran, learned counsel for respondents 1 and2 submitted that as per Section 34 of the Hindu Religious &Charitable Endowments Act, 1959 the Government has to grantpermission to sell the temple land and on the basis of proposalreceived from the first respondent on 25.3.2008 through the PrincipalCommissioner, Hindu Religuous & Charitable Endowments in hisproceedings dated 16.4.2009, the Government accorded approval byG.O.Ms.No.184, Tamil Development, Religious & Information Department,dated 15.7.2009. Pursuant to which, the first respondent issuedconfirmation order on 27.9.2009 and the same was communicated to thethird respondent, who in turn communicated the same to the petitioneron 8.10.2009 and the petitioner instead of paying the balance amountand execute the sale deed, has chosen to file the writ petition andthe same is liable to be dismissed.13. Mrs.Chitra Sampath, learned counsel for the third respondentsubmitted that as per Clause-8 of the tender conditions, thepetitioner was put on notice that the confirmation will be givenonly after the approval/permission granted by the first respondentand the petitioner being aware of the said condition is not entitledto contend that already one and half years have passed and noconfirmation order having been communicated, he is entitled towithdraw his offer. The learned counsel also cited a judgment of thisCourt in THE RAJANAGARAM VILLAGE CO-OPERATIVE SOCIETY VS. P.VEERASAMIMUDALY, reported in 1950 MLJ 486, in support of her contention. Thelearned counsel also submitted that while accepting the successfulbid of the petitioner, the petitioner was informed that the auctionis confirmed and only formal approval has to be given by the firstrespondent and the same is also granted after getting orders from theGovernment as stated supra and therefore, the petitioner is notentitled to maintain the writ petition and as per the Clause-10 ofthe tender conditions, his initial deposits are to be forfeited.14. I have considered the rival submissions made by the learnedcounsel for the petitioner, learned counsel for respondents 1 and 2and the learned counsel for the third respondent.15. The auction for the sale of of the said land was conductedpursuant to the order of the Division Bench of this Court made inWrit Appeal No.3861 of 2003 and W.P.No.36958 of 2005, dated16.11.2007. In paragraphs 17 to 25 of the judgment, it is held asfollows:-" 17. The only question is, whether the presentappellant should be permitted to complete the transaction bymatching the offer given by the ninth respondent?18. The earlier auction lost its significance in viewof the passage of time and the land value had also beenincreased in the meantime, as evident by the valuation https://hcservices.ecourts.gov.in/hcservices/ certificate produced by the learned counsel for H.R.& C.E.Department.19. It is quite clear from the provisions contained insection 34 of the H.R. & C.E. Act that while permitting thetemple authority to alienate any property, the best interestof the temple has to be kept in mind. In fact, the previousdecision of the Division Bench also clearly reflects such asentiment. As has been observed earlier, the auction had notbeen held properly and therefore, such auction had been setaside and there was a direction for holding a fresh auction.It is no doubt true that the temple authority had nogrievance against the last auction and only the appellant haschallenged the said auction.20. Therefore keeping in view of the overriding factorrelating to the protection of the deity and keeping in viewthe long passage of time, we do not think it fit, in theinterest of justice, to accept the submission of theappellant to complete the transaction by matching the offergiven by the ninth respondent.21. The proper course which could be resorted to forreceiving best price for public property would be conductingpublic auction in a fair and transparent manner after givingwide publicity.22. In AGARWAL & MODI ENTERPRISES PVT.LTD. & ANR. v. NEW DELHI MUNICIPAL COUNCIL (2007(10) SCALE 549, theSupreme Court observed as follows:-"Disposal of public property partakes the character oftrust and there is distinct demarcated approach for disposalof public property in contradiction to the disposal ofprivate property i.e. it should be for public purpose and inpublic interest. Invitation for participation in publicauction ensures transparency and it would be free from biasor discrimination and beyond reproach."23. In the above circumstances, we are inclined todirect the conduct of fresh auction to sell the property inT.S.Nos.2750/1, 2750/2 and 2751 in Cuddalore O.T, belongingto the third respondent through tender-cum-auction by fixingthe upset price at Rs.2 crores.24. Fresh tender-cum-auction notice should be issued bythe third respondent within a period of thirty days from thedate of receipt of a copy of this order. Such notice shouldbe published in leading newspapers in English and Tamil. Theauction should be conducted in a fair and transparent manner. https://hcservices.ecourts.gov.in/hcservices/

25. The amount which had been deposited by the presentappellant as well as the ninth respondent shall be refundedalong with the accrued interest within thirty days from thedate of receipt of a copy of this order." 16. Admittedly, auction notice was issued by the thirdrespondent on 31.12.2007 based on the Division Bench order invitingbid for the sale of the lands to an extent of 4.84 acres. The date ofissuing of tender forms was fixed from 24.1.2008 10.00 a.m., to31.1.2008 5.00 p.m., The date of receipt of tender forms was fixedfrom 29.1.2008 10.00 a.m., to 1.2.2008 12.30 p.m., The date ofauction was fixed on 1.2.2008 at 1.00 p.m. The authority to conductthe auction was notified as the second respondent-AssistantCommissioner, Hindu Religious and Charitable Endowments, Cuddalore.The upset price was fixed Rs.2 crores. It is not in dispute thatseveral persons had participated in the auction by submitting theirtender and the petitioner's bid being the highest bid i.e. a sum ofRs.5,01,16,000/-, he was declared as the successful bidder on1.2.2008 and the petitioner having been declared as a successfulbidder, he has paid Rs.10% of the bid amount of Rs.50,11,600/- on4.2.2008 apart from the payment of EMD to the tune of Rs.10 lakhs.As per the tender condition No.8, the confirmation order has to beissued by the first respondent and the balance bid amount, i.e. 90%of the bid amount has to be remitted by the successful bidder withinthirty days from the date of receipt of the confirmation order andthereafter, to execute the sale deed. The parties to the proceedingsnamely, the petitioner and the respondents are bound by the terms andconditions in the tender notice dated 31.12.2007. Admittedly, noconfirmation order was served on the petitioner either by respondents1 and 2 or by the third respondent before the petitioner submittedhis application to withdraw from the bid that was on 19.8.2009. Thereceipt of the withdrawal letter submitted on 19.8.2009 is acceptedby the third respondent in his proceedings dated 8.10.2009 inparagraph-3. Thus, it is beyond doubt that before the communicationof the confirmation order on 8.10.2009 sent to the petitioner by thethird respondent, the petitioner has submitted his application towithdraw the offer. The issue to be decided is whether the petitioneris entitled to withdraw his offer.17. Section 5 of the Indian Contract Act (9 of 1872) is to bereferred to at this juncture, which reads as follows:-" Revocation of proposals and acceptance:-A proposal may be revoked at any time before thecommunication of its acceptance is complete as against theproposer, but not afterwards.An acceptance may be revoked at any time before thecommunication of the acceptance is complete as against the https://hcservices.ecourts.gov.in/hcservices/ acceptor, but not afterwards."18. While directing forfeiture of the "Earnest Money Deposit"the provisions of the Contract Act, 1872 are to be kept in mind. Inthe decision reported in 2007 (1) SCC 228 (Saurabh Prakash vs. DLFUniversal Ltd), the Honourable Supreme Court held that forfeiture ispermissible only when a concluded contract has come into being andnot prior thereto.19. In this case, as stated supra, the confirmation order waspassed by the first respondent only on 27.9.2009, which wascommunicated by the third respondent to the petitioner only on8.10.2009. Thus, it is manifest that till 27.9.2009, there was noconfirmation of sale as stated in the auction notice. As long asthere is no confirmation of sale, the petitioner as a successfulbidder is entitled to withdraw the offer, as there is no concludedcontract in terms of Section 5 of the Indian Contract Act, 1872. Asimilar issue was considered by the Supreme Court in the decisionreported in AIR 2000 (5) SC 3505 ( State of Kerala v. V. NarayanaPillai), wherein it is held as follows:-" 3. Admittedly, in the present case the auction periodcommenced on 1-4-1981. The auction-sale had taken place on27-3-1981 but confirmation of sale, however, was not made bythe Board of Revenue till 7-5-1981. It was not communicatedto the successful bidder till 11-5-1981. The mandate of Rule5(14) to the effect that the rejection or confirmation shallbe conveyed “as soon as possible” was obviously respected inits breach. The respondent pleaded justification, in theadmitted facts of the case, to withdraw because of the delay.5. ....... the legal representatives of the successfulbidder, have been deprived of the use of the amount of Rs8,70,300/-, which has been lying in deposit with the StateGovernment all this time. The State had no justification towithhold that amount. That amount shall be refunded to therespondents within two months from today together withinterest @ 12% per annum from the date of deposit of thesecurity amount till the amount is paid to the respondentstogether with interest. The solvency certificate forRs.5,80,200 shall also be returned to the respondents, withinthe aforesaid period."20. In the above referred judgment, the Supreme Court has takennote of the delay in concluding the contract, namely, theconfirmation and upheld the order of the High Court, which cancelledthe auction and ordered return of the amount with interest. In thiscase, even though no time limit is stated for approving/confirmingthe bid by the first respondent, admittedly, there is unreasonabledelay on the part of the first respondent only on 16.4.2009 i.e. https://hcservices.ecourts.gov.in/hcservices/ after one year and three months from the date of auction, theproposal was sent to the Government for approval/permission which isrequired under Section 34 of the Tamil Nadu Hindu Religious andCharitable Endowments Act, 1959. The said delay on the part of thefirst respondent is not at all explained in the counter affidavitfiled. The delay in sending the proposal to the Government on thepart of the first respondent is evident from the reading ofG.O.Ms.No.184, Tamil Development, Religious & Information Department,dated 15.7.2009, wherein the letter of the first respondent dated16.4.2009 is referred to. In the counter affidavit, even though it isstated that the first respondent can issue the confirmation orderonly after according previous approval of the Government, there isunreasonable delay on the part of the first respondent in sending theproposal to the Government, for which the petitioner cannot beblamed, as the petitioner has already parted with huge amount of morethan Rs.60 lakhs and without any return waited for confirmation forabout one and half years. In the decision reported in AIR 1969 SC1157 (Visweswaradas Gokuldas v. Narayan Singh & Another), it is heldthat letter of withdrawal sent before communication of acceptance bythe competent authority is valid.21. In the decision reported in AIR 1975 MAD 292 (State vs. R.Ranganathan Chettiar), the issue decided was as to whether mereacceptance of highest bid by the Sale Officer can be treated asconcluded contract. In paragraphs- 8 to 10 of the judgment, it isheld as follows:-" 8. .... ... A successful bidder should be deemed to be oneto whom a communication has been sent by the appropriateofficer intimating him of the order confirming the sale inthe prescribed form. Clause-19 makes this very clear. Until,therefore, a confirmation of the sale is sent, persons likethe plaintiff can only be pigeon-holed in the compartment of"highest bidder" whose bid may or may not be accepted (seeClause 13). A "successful bidder" would be one who was notonly the highest bidder, but also one who has paid the saleamount and the security deposit and a person to whom anintimation as to confirmation of the sale has been sent andwho is ready and willing to execute an agreement as providedin clause 19 within ten days of the receipt of the order ofconfirmation.10. .... It is also made clear that the highest bid isaccepted only subject to the above features. Thisunambiguous language in clause 13 is also a pointer to theeffect that the nomenclature "highest bid" has a meaningdifferent from "successful bid" and that "highest bid" hasto be further accepted and it is only on such acceptance itbecomes a "successful bid". As long as there is noacceptance by the District Forest Officer and so long as https://hcservices.ecourts.gov.in/hcservices/ such a communication was not sent and receipted by theplaintiff as stipulated in clause 19, we are of the viewthat there is no scope for holding that there was aconcluded contract of sale of goods by the State through itsauthorised officer to the plaintiff on the date when theauction was held and when the plaintiff was declared as thehighest bidder. From the trend of events that happened it isseen that we would be encouraging unjust enrichment if theplaintiff were to be allowed to take the amount in Courtdeposit pursuant to a contract which obviously did not givehim any right which could be enforced in a Court of law."22. In the decision reported in AIR (34) 1947 MADRAS 366(Somasundaram Pillai v. Provincial Government of Madras), theDivision Bench of this Court in paragraph-8 has held as follows:-" 8. In the present case, there was a provisional acceptanceby the Sub-Collector of the appellant's bids, but theCollector refused to confirm the acceptance and directed thesale to continue. He changed his mind at a later stage andaccepted the bids, but before this happened, the appellanthad withdrawn them, which he was entitled to do in law asthere was no consideration to support his implied acceptanceof the condition that once a bid had been made it could notbe withdrawn. If the conditions of sale had statutory force,the position would of course be different but they had notstatutory force. They were merely conditions which the Boardof Revenue had directed should be imposed in respect ofauctions of liquor shop licences. We are firmly of theopinion that the appellant was entitled to withdraw his bidsbecause the prohibition against withdrawal had not the forceof law and there was no consideration to bind him down tothe condition. For these reasons, we allow the appeal anddecree the suit with costs throughout."23. A similar view was taken by the Andhra Pradesh High Court inthe decision reported in AIR 1963 AP 110 (Raghunandhan vs. State ofHyderabad). In the decision reported in AIR 1972 SC 1242 (HaridwarSingh v. Bagun Sumbrui & Others), the Supreme Court held that evenconditional acceptance of bid is not a concluded contract.24. What is the reasonable time for confirming the auction inthe absence of any date mentioned in the notification was consideredby the Division Bench of Orissa High Court in the decision reportedin AIR 1978 ORISSA 41 (Sri Durga Saw Mill vs. State of Orissa andOthers). In the said judgment, the petitioner was called upon by thedepartment to ratify the auction within certain time and if it wasnot ratified within the time mentioned in the notice, it wasspecifically informed that the proposal will be withdrawn. Since noorder was communicated within the said period, the withdrawal of the https://hcservices.ecourts.gov.in/hcservices/ offer was found valid by the Division Bench. The Division Bench ofthis Court in the decision reported in 2002 (4) CTC 437 (State ofT.N. v. Nishath Essential Oil Distillery) held that an offer can bewithdrawn before the communication of the acceptance of the offer. Inthe decisions reported in AIR 1973 MP 24 (State v. Hakim Singh), itis held that an offer made pursuant to tender notification can bewithdrawn before the communication of the order of confirmation.25. In the Division Bench judgment reported in AIR 1995 ANDHRAPRADESH 362 (M/s. Krishnaveni Constructions vs. The ExecutiveEngineer, Panchayat Raj, Darsi and others), in paragraph-8, thequestion arose was as to whether imposing a clause in the tendercondition that the offer cannot be withdrawn before it was concludedwas held invalid. In paragraphs 8 to 10, it is held as follows:-" 8. From the above observations, I can reduce that an offermade containing a promise not to revoke it and keep it opendoes not prevent the offerer from revoking the offer, fornormally such a promise is unsupported by any consideration.But, if a promise to keep the offer open is supported byconsideration, the offerer is bound by the promise and cannotrevoke the offer: (See Chitty on Contracts Vol.1, 24thEdition, paragrapgh 209). It is on this principle that acondition in the tender that the tender cannot be withdrawnbefore it is accepted is invalid and does not prevent atenderer to withdraw his bid before its acceptance. 9. On facts stated above, it is crystal clear that thetenderer, that is to say, the petitioner-firm was bound byits offer till the orders of the Government accepting orrejecting its offer was communicated to it within threemonths therefrom as per the relevant clause of the tender inquestion. But, there is no material on record to infer thatthe promise to keep the offer open till the stipulated periodwas supported by any consideration and, therefore, theaforementioned condition appears to be invalid and the clauseof forfeiture is unenforceable. It is pertinent to note thatthe petitioner-firm had withdrawn the offer through theletter on the same day at about 6.30 p.m., before it wasaccepted by the Government and, therefore, it was not aconcluded contract. As noted above, the prohibition clause,being invalid, cannot be enforced into service. Actually theconsideration mentioned in the clause in question of thetender is no consideration in the eye of law.10. For the foregoing reasons, I reach to the conclusionthat the act of respondent Nos.1 to 4 forfeiting the earnestmoney was unauthorised as there was no formation of contractand the clause of the tender in question was inoperative andinvalid." https://hcservices.ecourts.gov.in/hcservices/

26. Thus, there are overwhelming judgments in support of thecontentions put forth by the petitioner. The tender notice dated31.12.2007 clearly states that the highest bid has to be approved bythe Commissioner, Hindu Religious and Charitable Endowments andconfirmation order will be issued thereafter. For properappreciation, the translated version of the said Clause is extractedhereunder:-"The tenders received will be opened immediatelyafter the bidding in public auction on 1.2.2008,in the presence of Tenderers and Bidders. Thesale will be confirmed for the highest biddingafter comparing the highest bidding in publicauction and the highest bidding quoted in theTender, subject to the approval of theCommissioner."Clauses 8 and 9 reads thus,"8.The proceedings of the tender-cum-publicauction is subjected to the order of approval andcancellation by the Commissioner, Hindu Religious& Charitable Endowment Department.9.The successful bidder of the tender-cum-public auction shall pay 10% of the bid amount,excluding the deposit, within three days andshall obtain the receipt. The balance amount hasto be paid within 30 days after obtaining theapproval of the Commissioner, Hindu Religious &Charitable Endowment Department and the sale deedshall be executed at his own costs. Onlythereafter, entry will be permitted to theaforesaid land."In the auction register, the second respondent recorded hisproceedings dated 1.2.2008 as follows:-"In the proceedings of the public auction of theland sale, Thiru Muthukrishnan, S/o.ThiruShanmugam, belonging to SIPCOT, Cuddalore, hadraised the highest bid of Rs.5,01,16,000/- (RupeesFive Crores One Lakh Sixteen Thousand only). Outof the 13 tenders received, if this amount iscompared with the highest bid amount ofRs.3,51,00,009/- (Rupees Three Crores Fifty OneLakh and Nine only) as quoted in the tender byThiru N.Muralidharan, S/o.Thiru T.R.NagarajaSastri, belonging to Chennai, the auction amountitself is higher. Therefore, in the https://hcservices.ecourts.gov.in/hcservices/ tender/auction proceedings that took place, theauction is registered in respect of the bid amountof Rs.5,01,16,000/- (Rupees Five Crores One LakhSixteen Thousand only) offered by ThiruS.Muthukrishnan, subject to the cancellation,approval of the same by the Commissioner and theAuction/Tender proceedings were closed."27. In the light of the unambiguous clauses contained in thetender notice, the decision cited by the learned counsel for thethird respondent reported in 1950 MLJ 486 (Rajanagaram Village Co-op.Societies vs. V.Veerasami Mudaly) has no application to the factsof this case. Further, in the tender notice, there is no clausestating that offer once made cannot be withdrawn. Whether forfeitureof EMD can be ordered if there is fault on the part of the personconducting auction was considered, though in different facts in thedecision reported in 2010 (1) CWC (Current Writ Cases) 279 (HaryanaFinancial Corporation v Rajesh Gupta). In paragraph-18, it is held asfollows:-"18.In our opinion, the appellants cannotbe given the benefit of clause 5 of theadvertisement. The appellants/Corporation cannotbe permitted to take advantage of their ownwrong. Clause 5 undoubtedly permits theforfeiture of the earnest money deposited. Butthis can only be, if the auction purchaser failsto comply with the conditions of sale. In ouropinion, the respondent has not failed to complywith the conditions of sale. Rather, it is theappellants/corporation which has acted unfairly,and is trying to take advantage of its ownwrong."In the said decision, the corporation failed to disclose the materialdefect about the non-existence of independent approach road to theplot, which was found as material defect and breach of Section 55(1)(a) and (b) of the Transfer of Property Act, 1882. In this case, inthe auction notice, the second respondent failed to disclose aboutthe requirement of getting prior approval from the Government asrequired under Section 34 of the Hindu Religious and CharitableEndowments Act, 1959.28.As stated in the previous paragraphs, there is unreasonabledelay on the part of the first respondent in communicating theconfirmation order and the petitioner having sent a representationbefore the confirmation order issued to him, the respondents are notjustified in contending that the petitioner is bound by the offermade and his initial deposit as well as EMD already paid are to beforfeited. https://hcservices.ecourts.gov.in/hcservices/

29. The petitioner even though claimed 24% of the interest fromthe date of deposit till the amount is returned, the learned SeniorCounsel for the petitioner fairly submitted that the petitioner willbe satisfied, if the interest accrued from the deposit afteradjusting the amount of Rs.1.5 lakhs, which was spent towardsconducting of auction is reduced and the balance accrued interestamount along with the deposit made by the petitioner to the tune ofRs.60,11,600/- is returned to the petitioner within two weeks. Thesaid submission made by the learned counsel for the petitioner isrecorded.30.The writ petition is partly allowed with a direction to therespondents to refund the amount of Rs.60,11,600/- to the petitionerafter adjusting a sum of Rs.1.50 lakhs from the accrued interest forthe said deposit amount and pay the balance amount to the petitionerwithin a period of two weeks from the date of receipt of a copy ofthis order. To safeguard the interest of the temple property fromencroachment, the respondents are directed to initiate fresh auctionproceedings forthwith in terms of the judgment passed by the DivisionBench of this Court in W.A.Nos.3861 of 2003 and W.P.No.36958 of 2005,dated 16.11.2007 by fixing the same upset price or by enhancing theupset price taking note of the interest of the temple and completethe same as expeditiously as possible. No costs. Consequently,connected miscellaneous petitions are closed.Sd/-Asst. Registrar//true copy//Sub Asst.RegistrarkbTo1. The Commissioner, HR & CE Department Nungambakkam High Road, Chennai – 600 034.2. The Asst. Commissioner, HR & CE Department, Sub Jail Road Cuddalore – 60 7 001.3. The Executive Officer, Arulmigu Varadaraja Perumal Temple Thirupathiripuliur, Cuddalore – 607 002.1 cc to M/s.Chitra Sampath, Advocate, Sr.No.257501 cc to Mr.B.S.G.Firm, Advocate, Sr.No.25475 Order in W.P.No.23479 of 2009BV {CO}TP/20.4.2010.