P L D 1968 Supreme Court 336 (PLP)

The "Mela Ram Building" was declared as a big mansion and put to auction on the 21st of September 1959, under the Settlement Scheme No. III. The highest bid of Rs. 10,30,000 was given by the appellants Nos. 15 and 16 and the next highest bid of Rs. 10,20,000 by the appellant No.

1. Among others Mr. S. A. Bary, respondent No. 2, offered a bid of Rs. 6,30,000, which was superseded by a number of other bids. The Auction Committee accepted the bid of the appellants Nos. 15 and 16 and as required by paragraph 8 of the Scheme, they deposited the earnest money of Rs. 5,

000. The auction, however, fell through because the appellants Nos. 15 and 16 were unable to deposit the balance of the sale price in cash as directed by the Chief Settlement Commissioner especially on account of their being foreign nationals and the dubious nature of the verified claims of the appellants Nos. 17 to 19, namely, Janda Rubber Works Limited and Universal Rubber Works, Lahore; Prague Chemical and Pharmaceutical Works Limited, Lahore; and Janda Chemical Pharmaceutical Works Limited, Lahore, which were offered by the appellants Nos. 15 and 16 for adjustment against the balance of the sale price. A perusal of the departmental file showed that on 22‑9‑1959 the Deputy Settlement Commissioner (Industries) put up a note before the Additional Settlement Commissioner (Industries) point ing out to him that the highest bid offered by the appellant Nos. 15 and 16 was less than thirty‑five times the annual rent and being foreign nationals their status as displaced persons and the verification of their claim to the tune of R s. 11,00,000 for the properties abandoned by them in India was of doubtful nature. On 28‑9‑1959 the Additional Settlement Commissioner (Indus tries) put up the case to the Chief Settlement and Rehabilitation Commissioner with the following note "In the first instance the bid offered is less than 35 years annual rent and secondly it is doubtful if Mrs. Thomas Janda can be treated as displaced person entitled to claim compensa tion. It is proposed to make a reference to the Claims Commissioner. Chief Settlement and Rehabilitation Commis sioner may kindly cancel the auction." Thereupon the Chief Settlement and Rehabilitation Commissioner on 29‑9‑1959 made an order to the effect "Will the Additional Settlement Commissioner (Industry) please call Mr. and Mrs. Janda and ask them whether they are prepared to pay the amount in cash. In case they are not prepared to do so, the auction should be cancelled and the building should be re‑auctioned." In pursuance to the order of the Chief Settlement Commissioner the appellant No. 15 was called upon to pay the balance of the sale price in cash, but by his letter dated 12‑10‑1959 he expressed his inability to do so. Accordingly the Deputy Settlement Commissioner on 14‑10‑1959 passed the following order "In compliance with C. S. and R. C's. orders at page 3‑ante, Mr. and Mrs. Janda were called for in this Office to enquire whether they are willing to pay the auction money in cash. Mr. Janda attended this Office on 12‑10‑1959 and refused to make cash payment. His undertaking in writing is placed below at P. U. C. In view of this and the orders of C. S. and R. C. (P‑3‑ante), the auction stands cancelled. The building will be put to auction again in due course." In spite of the cancellation of the auction held on the 21st September 1959, Mr. Janda continued to press his claim for the purchase of the Mela Ram Building as the highest bidder. In tile meantime Noor Muhammad Butt had also made a written offer to the Additional Settlement Commissioner (industries) for the purchase of the Mela Ram Building for a sum of Rs. 10,20,

000. On 8‑11‑1959 the Additional Settlement Commis sioner (industries) again put up the file before the Chief Settle ment and Rehabilitation Commissioner for orders as to whether the highest bid given by Mr. Janda should be considered as cancelled or the offer for Rs. 10,20,000 made by Mr. Noor Muhammad Butt be accepted as he was auction purchaser of the adjoining building in respect of which a dispute pertaining to fixation of boundaries had arisen which would in that case be automatically resolved. Earlier on the 3rd November 1959, S. A. Bary, respondent No. 2, had also made a written offer for" tile purchase of the Mela Ram Building as an allottee in possession. The application was entertained by the Chief Settlement Commissioner and he directed that it should be put up along with the relevant appear. On 9‑11‑1959 Syed Hashim Raza directed that "both parties" should be asked to appear before him on 11‑11‑19`

9. The case could not be taken up on that date and was adjourned on 14‑11‑1959, on which date the appellants Nos. 15 and 16 made a joint offer for the purchase of Mela Ram Building for a sum of Rs. 10,50,

000. The offer was accepted by Mr. Hashim Raza, Chief Settlement Commissioner on the same day. In due course the appellants Nos. 1, 15 and 16 paid the balance of the sale price by adjustment against the verified claims of the appellants Nos. 2 to 14 and 17 to 20 as associates. On the 18th of December 1959, possession was delivered to the appellants Nos. 1, 15 and 16 and the provisional transfer order issued in their favour. Thereafter S. A. Bary, respondent No, 2, whose application dated 3‑11‑1959 had not been disposed of by then moved a formal review application on 6th July 1960, before Pir Ahsanuddin who had in the meantime succeeded Syed Hashim Raza as Chief Settlement Commissioner. In substance the respondent No. 2 maintained that as a claimant displaced person and an allottee of the part of the Mela Ram Building he had a pre ferential right to its transfer against the appellants Nos. 1, 15 and 16, and that there was no instance in which a big mansion was transferred to non‑occupants "on a private bid when the case of a claimant allottee was still under consideration and awaiting orders". The application was heard by Pir Ahsanuddin with notice to the appellants Nos. 1, 15 and 16 who were repre sented by their counsel and accepted by order dated 6‑6‑1961. In effect Pir Ahsanuddin found that the joint offer made by the appellants Nos. 1, 15 and 16 two months after the auction was held was not in continuation of the auction proceedings and that the acceptance of the fresh offer dated the 14th November 1959, did not amount to the confirmation of the auction held on the 21st September 1959. The contention raised by the counsel for the appellants Nos. 1, 15 and 16 that the Chief Settlement Commissioner was competent to alter the terms of the auction under paragraphs 8, 9 and 10 of the Settlement Scheme No. III was found to be unwarranted inasmuch as on the relevant date Syed Hashim Raza as Chief Settlement Commissioner was not competent to dispose of a "big mansion" otherwise than by an unrestricted public auction. The order of Syed Hashim Raza dated 14th November 1959, by which he had accepted the joint offer of the appellants Nos. 1, 15 and 16 for the purchase of the Mela Ram Building for a sum of Rs. 10,50,000 was accord ingly set aside and it was directed that the building be disposed of by a fresh auction on a date to be given by the Additional Settlement Commissioner, Lahore. Aggrieved by the order of Pir Ahsanuddin the appellants Nos. 1, 15 and 16 moved the High Court in the exercise of its writ jurisdiction contending that the proceedings for confirmation of the auction held on 21‑9‑1959 were still pending with Syed Pashim Raza and is continuation of those proceedings he has accepted the final offer of Rs. 10,50,000 made by them and that the provisional transfer order issued in their favour on the 15th November .1959, was binding on both the parties and in the absence of any breach of terms and conditions whereof the Chief Settlement Commissioner was not competent to set aside the transfer in their favour. It was also contended that the application dated 16th July 1960, for review moved by the .respondent No. 2 against the order of Syed Hashim Raza dated 14‑11‑1959 was hopelessly barred by time and no sufficient cause was made to appear for condonation of the inordinate delay and that the respondent No. 2 had no locus standi to apply for review as he had no entitlement to the transfer of the Mela Ram Building. None of the grounds found favour with the learned Judges in the High Court whereupon the writ petition was on 16‑1‑1963 dismissed. An application for special leave to appeal being Petition No. 60 of 1963 which proceeded on similar grounds was dismissed on 6‑3‑1963, but by order dated 18‑10‑1963 review was granted for reconsideration of the arguments that the sale in favour of the appellants fell within the powers of the Chief Settlement Commissioner under paragraph 16‑A of the Schedule E to the Displaced Persons (Compensation and Rehabilitation) Act having been made in a manner which was within the cognizance of the Central Government and presumably had their approval and on a wider basis the Chief Settlement Commissioner In whom vested the power to transfer had exercised the power in this case in a manner consonant with the purposes of the Act. In support of the review application the appellants filed particulars of big mansions in which after the auction was completed the Chief Settlement Commissioner had concluded the transfers in favour of persons who were not the highest bidders or had not participated in the auction for an amount different from the highest bid. As brought out above the auction proceedings held on the 21st September 1959, were put to an end under the orders of the Chief Settlement Commissioner dated 6‑6‑1961. This appeared to be the admitted position as Noor Muhammad Butt himself made an offer of Rs. 10,30,000 and later on with the appellants Nos. 15 and 16 made a joint offer of Rs. 10,50,

000. The contention that the order by Syed Hashim Raza dated the 14th November 1959, was in continuation of the auction proceedings dated 21st September 1959, was thus factually incorrect. Under paragraph 16 of the Schedule to the Displaced Persons (Compensation and Rehabilitation) Act, every building and premises declared by the Chief Settlement Commissioner to be a big mansion was to be disposed of by unrestricted public auction. Section 10 of the Act in its unamended form at the relevant time read as follows " Power to transfer property from the compensation pool. Subject to the provisions of this Act and the rules made there under, the Settlement Commissioner may transfer or dispose of any property out of the compensation pool (a) on evaluation basis, or by sale by means of auction or otherwise, in accordance with the provisions of the First Schedule; (b) in such other manner as may be prescribed." The Chief Settlement Commissioner had thus no power to dispose of a big mansion except by unrestricted public auction as pro vided in the Schedule. It followed that the order by Syed Hashim Raza dated 14‑11‑1959 accepting the joint offer by the e appellants Nos. 1, 15 and 16 for the purchase of the Mela Ram Building for a sum of Rs. 10,50,000 was beyond his competence and as such was rightly set side by Pir Ahsanuddin on review. The report submitted by the Department regarding the instances quoted by the appellants about the disposal of big mansions by the Chief Settlement Commissioner otherwise than by unrestricted public auction showed that there was no parallel case from which it could be inferred that it was a common practice with the Chief Settlement Commissioner to summon the persons who had given highest bids at an auction and to ask them to increase the amount and dispose of buildings in their favour. In any case the question involved was of legal compe tence which could not be affected by any departmental practice. There was also little force in the plea that the review application made by the respondent No. 2 was barred by time and there did not exist any sufficient cause to condone the delay. As seen the said respondent had moved against the proposed sale in favour of the appellants Nos. 1, 15 and 16 and made a counter offer of Rs. 10,10,

000. The Chief Settlement Commissioner thereupon called for the relevant papers, but the Office did not move in the matter. Similarly no notice of the proceedings in which the appellants Nos. 1, 15 and 16 made a joint offer of Rs. 10,50,000 0 was given to the respondent No.

2. The application dated the 6th July 1960, was therefore in effect in continuation of the application dated the 3rd November 1959, and an averment to this effect was expressly made in the latter application. There was thus no delay in the filing of the application for review dated the 6th July 1960, on account of which should have been dismissed as barred by time. The High Court has in the circumstances of the case rightly declined to interfere in the exercise of its writ jurisdiction with the order of Pir Ahsanuddin dated 6th June 1961, by which he set aside the sale of the Mela Ram Building in favour of the appellants Nos. 1, 15 and 16 under the orders of Syed Hashim Raza dated 14‑11‑1959. It may be added that the Mela Ram Building was eventually acquired by the Provincial Government for the construction of the WAPDA House and the dispute in this case now was confined to the compensation to be paid for it by the Collector. In the result the appeal is dismissed, but keeping in view the circumstances of the case we make no order as to costs. A. H. Appeal dismissed,