1991 PLP 1292 (SCMR)

Muhammad Rashid Chughtai, Advocate Supreme Court and Ch. Mehdi Khan Mehtab, Advocate‑on‑Record for Petitioner. Nemo for Respondents. Date of hearing: 23rd October, 1989. SAAD SAOOD JAN, J.‑‑‑The petitioner and respondent No.l took part in an auction held by the Municipal Corporation, Faisalabad for the purposes of leasing out its sullage farm for a period of two years. They offered the highest did and signed the did sheet to confirm their bid. The bid was later approved by the Controlling Authority. Though they did make some deposits but failed to pay the entire amount as required by the terms on which the auction was held. Consequently, no proper lease agreement was drawn up and the lease of the sullage farm was again put to auction. The highest did at the auction was much less than that which was offered by the petitioner and respondent No.l. The Municipal Corporation filed a suit against the petitioner and respondent No. 1 to recover the difference between the bid made by them and the highest bid that was made at the re‑auction. The suit was decreed by the trial Court after adjusting the amount, already deposited by the petitioner and respondent No. 1 by way of security or advance of lease money. The petitioner filed an appeal in the High Court but it was dismissed. He now seeks leave to appeal from this Court.'

2. In support of this petition it is contended that the Municipal Corporation could not enter into a contract with any person unless the terms of the contract were evidenced by a written deed; as in this case, no proper agreement was drawn up there was no basis upon which the Municipal Corporation could found its claim against them. It is true that before the lease was re‑auctioned, a proper lease agreement had not been executed by the petitioner and respondent No.l but then the foundation of the claim of the Municipal Corporation was not the breach of the terms of the lease but the violation of the terms on which the auction was held. It was not the case of the petitioner that the terms of the auction were not written. It was not disputed by the petitioner that he had signed the bid sheet at the conclusion of the auction proceedings. In the circumstances, the objection that in the absence of a properly drawn up lease agreement the Municipal Corporation could not claim any damages on the failure of the petitioner and his co‑bidder to abide by the terms on which the auction was held, is without any merit.

3. It was also contended on behalf of the petitioner that the Controlling Authority had not approved his bid. This contention is factually incorrect as the letter conveying the approval clearly indicates that it emanated from the Controlling Authority.

4. It was finally argued that the petitioner as distinguished from respondent No.l could not be made liable to pay any damages for he was not placed in possession of the farm immediately after .the auction. This contention is also without any merit. Respondent No.2 was already in possession of the farm when the auction was held. Apart from that the claim of the Municipal Corporation as already pointed out was based on the breach of the terms of the auction and not of lease.

5. No other point was raised in support of this petition. It is hereby dismissed. A.A./S 487/S. Petition dismissed.