P L D 1962 (W (PLP)

ORTCHESON, J.-This is a petition by one Abdul Majid, who describes himself as resident of house No. 765-C, Bannu City, against (1) the Settlement Commissioner, Peshawar and Dera Ismail Khan Divisions, Peshawar, (2) the Additional Settlement Commissioner, Peshawar and Dera Ismail Khan Divisions, Peshawar ; and (3) Sufi Ghulam Muhammad, Superin tendent, Deputy Commissioner's Office, Bannu, for the issue of a writ of certiorari, quashing the orders of respondents Nos. 1 and 2 cancelling the auction sale in respect of house No. 765-0, Bannu City, in which the petitioner's bid had been approved, and for a writ of mandamus to respondents Nos. I and 2, directing them to restore the sale in favour of the petitioner.

2. The petitioner's case is that the house in dispute, which was formerly evacuee property, was allotted to his brother Abdur Rashid in 1948, and the petitioner took up residence in it with his brother. When the Displaced Persons (Compensation and Rehabilitation) Act, XXVIII of 1958 (hereinafter referred to as the Act) was passed the house in dispute was acquired by the Central Government by a notification under section 3 and, in accordance with the terms of the Settlement Scheme framed under the Act, was put to auction on the 23rd of November 1960 A by the Auction Committee, Bannu. None of the bids reached the reserve price of Rs. 4,320, the highest offer being that of the petitioner, namely, Re. 3,000.

3. According to the petitioner his bid was approved on the 19th of December 1960 by the Additional Settlement Commis sioner, respondent No. 2, and in due course he received the following notice, No. 567/DSC, dated the 2nd of January: 1961, from the Deputy Settlement Commissioner, Bannu :- "The highest bid for Rs. 3,000 offered by you in respect of evacuee property No. 765/C (shop, house) of . . . . . . . has been approved by the Additional Settlement Commissioner, Peshawar, vide his order No. 16409 dated 19-12-1960. "You have so far deposited 1/4th of the bid money viz 8 Rs. 800. "You are accordingly required to pay the balance viz. 3/4th of the bid money in 12 equal monthly instalments of Rs. 2,200 (sic), from the date of receipt of this notice. "A rent clearance certificate may also be obtained from the Assistant Accounts Officer, Settlement Centre, Bannu, and furnished to the Head Clerk. No P. T. O. will be issued unless rental arrears are first cleared."

4. Later, however, the Additional Settlement Commissioner accepted the offer of Sufi Ghulam Muhammad, respondent No. 3, to pay the reserve price. His order, which is dated the 27th of December 1960, runs- "The offer of Rs. 4,320 equal to the reserve price made by the applicant is hereby approved." The petitioner appealed against the order to respondent No. 1, the Settlement Commissioner, Peshawar, who rejected the appeal in the following terms:- "Parties present. Arguments heard and record perused. "This is an appeal against the orders (sic) dated nil of the Additional Settlement Commissioner, Peshawar. The facts of the case are that the appellant was the highest bidder for the house below the reserve price. Later the respondent (Sufi Ghulam Muhammad) offered the reserve price and the property was ordered to be transferred to him. The appellant has now come on (sic) appeal on the ground that he is prepared to pay more than the reserve price. This is no ground to set aside the order of the learned lower Court which has been passed according to the rules and instructions. The appeal is, therefore, rejected and the orders (sic) of the lower Court is upheld."

5. Feeling aggrieved by the orders of respondents Nos. 1 and 2 the petitioner has filed the present petition.

6. A report was called from respondent No. 2, the Addi tional Settlement Commissioner, but was submitted by the Deputy Settlement Commissioner. It is admitted that the petitioner's bid was approved by respondent No. 2, but it is stated that the approval was subject to the condition that nobody was prepared to pay the reserve price. The action of respondent No. 2 in accepting the reserve price subsequently offered by respondent No. 3 is sought to be justified on this ground.

7. Before discussing the instructions issued by the respondents Department reference may be made to the statutory position as laid down in the Schedule to the Act. After providing for the transfer of houses to claimants or their near relations (paragraph 1), non-claimant displaced persons (paragraph 2), and locals (para graph 3), paragraph 4 lays down that houses not transferred under the above paragraphs shall be available for transfer to any claimants who applies in that behalf subject to the conditions laid down. Paragraph 5 was subsequently omitted. The para graph relevant to this case is No. 6, which runs- "Houses not transferred under paragraphs 1, 2, 3 and 4 shall be sold to the highest bidder in an unrestricted public auction."

8. It will be seen that this paragraph contains no provision for refusing to accept the highest bid, but by memo, No. 449P-PI-Reh/60, dated the 9th/16th March 1960, the Settle ment authorities issued the following instructions :- With reference to this office Memorandum No. 839-PI-Reh/60, dated 9th January 1960, on the above subject, it has been reported that in some cases the highest bid offered in the auction of shops has been below the reserve price fixed on the basis of 40, years of gross annual rent for 1946. In some cases there have teen no bids as it was proposed to start the bid at the reserve price. The Chief Settlement Commissioner has decided that in suitable cases the Chairman, Auction Committee may start the bid below the reserve price. If the highest bid offered is less than the reserve price, the Additional Settlement Commissioner of the area concerned may at his discretion transfer the shop to any person by negotiation who is prepared to offer a reasonable price. "The same principles may be adopted while auctioning the houses which could not be disposed of by ear-marking." It is on the basis of the above instructions that the respondents seek to justify their action in the present case.

9. Even assuming the above instructions to be intra vires a point which is at least arguable, we have no hesitation in holding that they cannot he so construed as to enable the Additional Settlement Commissioner, having once approved a bid, subsequently to cancel it and accept the reserve price from an outsider. It was strenuously argued on behalf of the respondents that the petitioner was aware that the acceptance of his bid by respondent No. 2 was only conditional, but there is no proof of this on the record, and the notice dated the 2nd of January, 1961 issued to him contains no hint to that effect. On the contrary, it stated in categorical terms that his bid had been accepted and call ed upon him to pay the balance of the bid money by instalments. It is further conceded by the respondents that one such instalments was actually paid.

10. In these circumstances the action of respondent No. 2 in cancelling the bid at the instance of the Deputy Commissioner, Bannu, and transferring the house in dispute to the latter's Superintendent is illegal. In our opinion the clear intention of the instructions is that negotiation can only be entered into before a bid is accepted. If the transaction were allowed to be upset by accepting the reserve price and cancelling the bid perhaps months after the auction, the result would be chaotic.

11. Another aspect of the matter is that to cancel the petitioner's bid" without giving him any opportunity of represent ing against such action is contrary to the elementary principles of natural justice. Moreover, if the subsequent order of respondent No. 2, dated the 27th of December 1960, be considered as P amounting to reviewing his earlier order of the 19th December the subsequent order is illegal as contravening section 21 (1) (6) of the Act, which provides that no order shall be modified or reversed unless reasonable notice has been given to the parties affected thereby to appear and be heard.

12. It may here be pointed out that the view we have expressed above was shared by Malik Fateh Khan, Settlement and Rehabilitation Commissioner with the powers of Chief Settlement and Rehabilitation Commissioner, Pakistan, in three connected Revision Petitions Nos. 403, 404 and 405 of 1961. The facts of that case were practically identical with those of the present. The property then in dispute was auctioned In August 1950, but failed to fetch the reserve price. A re-auction met the same fate, where upon, on the recommendation of the Auction Committee, the Additional Settlement Commissioner confirmed the sale in favour of the petitioners, who had given the highest bid. The price was actually paid, but later on an application made by the respon dents, the previous order was reviewed, the sales were set aside and the property was ordered to be transferred to the respondents at the reserve price without giving notice to the previous auction purchasers. In the course of his order the learned Settlement Commissioner remarked : "The order of the learned Additional Settlement Commissioner is defective for two reasons (1) he could not have reviewed his previous order either on an applica tion made by the respondents or suo mote without obtaining the permission of the Settlement Commissioner, and even after the sanction was obtained no adverse orders could have been passed against the auction purchasers without giving notice to them. The order has, therefore, to be quashed for this defect in procedure."

13. The instructions in connection with the transfer of evacuee Industrial concerns and unregistered factories set out on page 307 of the Manual of Settlement Law and Procedure, published by the Government of Pakistan, though not, of course, applicable to the present property, throw some light on the intention of the Department. Paragraph 5 of the above instructions provides that the Chief Settlement Commissioner shall publish an auction programme through an advertisement in an important newspaper. Paragraph 6 lays down that no property shall be auctioned under the Scheme except after the expiry of fifteen clear days from the date of publication of the notice. Paragraph 7 enables any person who is entitled to transfer of the property under sub-paragraphs (2), (3) and (4) of paragraph 15 of the Schedule to the Act to submit an application to the Chief Settle ment Commissioner. Paragraph 8 runs- "The application under the preceding paragraph shall be submitted so as to reach the Chief Settlement Commissioner within teas dais of the publication of the advertisement of auction ; "Provided that the Chief Settlement Commissioner may, on sufficient cause being shown by the applicant, extend the period beyond ten days ; "Provided further that if in the meantime the property has been put to auction but acceptance of the bid has not been com municated to the successful bidder, the auction shall not be finalised till the final disposal of the application." The words italicised appear to us to carry the clear implication that when acceptance of the bid has been communicated to the successful bidder the auction must be deemed to have been finalised.

14. For the above reasons we hold that, the bid of the present petitioner having been approved without communicating to him the existence of any condition, the Additional Settlement Commissioner had no power subsequently to re-open the matter and cancel his bid.

15. In the course of arguments our attention was drawn to a decision of the Supreme Court of Pakistan in Badrul Jalil, Rent Controller, Hyderabad and others v. Wali Muhammad (P L D 1956 S C (Pak.) 259). In that case Wali Muhammad respondent had been summarily ejected without notice from certain evacuee property. The order of ejectment was held to be illegal and the order for a writ of mandamus directing restoration of possession to the respondent was upheld by their Lordships of the Supreme Court. On the analogy of the above decision we quash the order of respondent No. 2 accepting the reserve price from respondent No. 3 as illegal and issue a writ of mandamus to respondents Nos. 1 and 2, directing them to restore the petitioner to possession of the property in dispute on the conditions laid down in the notice of approval of his bid conveyed to him on the 2nd of January 1961. The costs of these proceed ings shall be borne by respondent No.

2. K. M. A. Petition accepted.