D. Manoharan and Another vs The Executive Officer Town Panchayat, (Special Grade) and Others

S. Jagadeesan, J.—Heard both sides. By consent, the Writ Petitions were taken up for final disposal.

Petitioners are claiming to be the lessees in respect of certain shops owned by the Thiruparankundram town Panchayat. Their case is that they

participated in the auction in the year 1990 and being the successful bidders in respect of the shops in which they are in occupation, they were

granted lease for a period of three years. In fact, the auction notice itself specifies the period of lease is for three years. After the expiry of the lease

period, the lease was renewed for a further period of three years from 1993 to 1996 and subsequently, the same was renewed for a further period

of three years. The lease period came to an end on 31.7.1999. The first Respondent has issued a Notification dated 16.7.1999 for auctioning the

lease hold right in respect1 of the shop numbers 1, 3, 4, 5, 7 to 9. The present Writ Petitions have been filed challenging the said Notification.

Learned Counsel for the Petitioners contended that when the lease period came to an end, the same was renewed periodically in the year 1993

and 1996 by enhancement of rent. Thus, the Petitioners having been in possession of the lease hold shops for the past nine years, have a legitimate

expectation of the renewal of lease in their favour. In fact, the auction was conducted on 22.6.1999 and the Petitioners were the highest bidders in

respect of the shops in their occupation and without confirming the auction in favour of the Petitioners, the impugned auction notice has been

published calling for tenders afresh. When periodically the lease has been renewed, it is not open to the Respondents to call for fresh tenders and

as such, the impugned Notification has to be quashed and consequently, the Petitioners'' highest bids have to be confirmed in respect of the shops

for which the offers have been made.

I have carefully considered the contentions of the learned Counsel for the Petitioners. Admittedly, prior to the impugned Notification, the auction

was conducted on 22.6.1999 calling for the tenders in respect of the shops. The Petitioners have also participated in the same and made their

offer. The grievance of the Petitioners is that their bids being the highest, ought to have been accepted and confirmed by the Respondents and

without doing so, the impugned Notification has been issued, calling for fresh tenders.

From the above admitted facts, it is clear that the Petitioners have participated in the auction held on 22.6.1999 without objecting for the

auction. Hence, now it is not open to the Petitioners to challenge the right of the Respondents to bring the shops for auction. Merely because the

Petitioners'' bids were not accepted and the reauction has been notified, the present writ petitions have been filed by the Petitioners. When the

Petitioners have participated in the earlier auction as stated already, they are estopped from challenging the present auction on the ground that the

Petitioners are entitled for the renewal of lease. Hence, there is no substance in the contentions of the learned Counsel for the Petitioners that the

Petitioners have got a legitimate expectation for the renewal of the lease in their favour.

So far as the contention of the learned Counsel for the Petitioners is concerned that the highest bids of the Petitioners ought to have been

accepted and without assigning any reason, the same cannot be rejected, I am of the view that it is for the appropriate authority to consider the

adequacy of the bid amount in respect of the shop. When the authorities found that the bid amount is low, they cannot be compelled to accept the

same. Considering the prevailing present market rate of the rents, the Respondents also may have a legitimate expectation of getting something

more, if the reauction is held. Hence, they cannot be prevented from conducting the reauction rejecting the bids made by the Petitioners, even

though the same may be highest bids in the auction held. When no arbitrariness or motive has been pleaded in the conduct of the Respondents in

rejecting the bids and bringing the shops for reauction, I do not find any infirmity in the conduct of the Respondents in holding the reauction. As

participated in the auction held on 22.6.1999, it is open to the Petitioners to participate in the ensuing auctions also and as such, their right has not

been affected.

Even though the learned Counsel for the Petitioners relied upon the judgment in the case of Punjab Communications Ltd. Vs. Union of India and

Others, for the proposition that the Petitioners are entitled for the legitimate expectation of renewal of lease. I am of the view that the said judgment

is of no help to the Petitioners, as the Petitioners had participated in the auction held on 22.6.1999 and the present auction being the continuation

of the same. In fact a Division Bench of this Court in A. Sathar Vs. The District Collector and Another, has held that the extension granted earlier

by the panchayat to the Appellant would not mean that the Appellant is entitled to continue in possession of the premises in question for ever by

paying ridiculously low rent. Learned Judges further observed that they are of the view that the extension of the lease to the Appellant in that case

is against the interest of the panchayat. On the basis of the above laid principles, the Petitioners herein are not entitled for the renewal of the lease.

When they are not entitled for renewal, the right of the Respondents to auction the lease hold right in respect of the shops owned by them cannot

be questioned.

The Writ Petitions are dismissed. No costs. Consequently, the connected W.M. Ps. are also dismissed.