LexRAMRAO JANKIRAM KADAM versus STATE OF BOMBAY
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1962
Sept'1flber, 26.
322 SUPREME COURT REPORTS [1963] SUPP.
RAMRAO JANKIRAM KADAM
v.
STATE OF BOMBAY
. (B. P. SINHA, C. J., K. C.
DAS GUPTA and
N. RAJAGOPALA AYYANGAR, JJ.)
Revenue Sale-Public auction-Connotation of "Sale"-
!Vhether sale for preiletermined nominal price is such sale-Lega-
lity-Suit to set asiile sa/,e-Limitation--!Vaiver arui estoppel-
Bombay Land Revenue Code 1879 (Bom. V. of 1879) Oh. XI,
ss. 167, 203-Bmnbay Revenue Juri~diction Act, 1876, (Bom.X of
1876), ss. 4(c) a.nd 11-Transfer of Property Act, 1882 (IV of
1882), 8. 41.
A sum pf about Rs. 9 ,000 was due from the appellant to
the Government on account of excise dues.
The movable and
immovable property of the appellant was several times put for
sale by auction under Ch. XI Bombay Land Revenue Code but
the amount remained unrecovered and three item• of lands
remained unsold. In view of a Government Order dated August,
30, 1933, which prescribed such a course, the Mahalkarl sought
permission of the Collector to make a nominal bid of Re. l/~
for each jtem of land in the next auction.
The perrr1ission was
granted and the Mahalkari informed the appellant that if no
bidders came forward at the next auction the lands would be
sold at the nominal price of Re. 1.
The auction was held and
as no stranger came- to bid the Mahalkari made the nominal bid
of Re. 1 for each item of land. The bid was accepted and the
sales were later confirmed. Subsequently, the Collector sold
the,e lands for -adequate consideration and the purchasers were
put in possession.
The appellant filed a suit challenging the
validity of these sales. The purchasers contended that the suit
not having been brought within one year of the sales was time
barred, that the suit was barred by ss. 4(c) and 11 of the
Bombay Revenue Jurisdiction Act and , that :he appellant was
disentitled to relief on the ground of acquiescence
and
estoppel.
Held, that the Sales were invalid and the suit was liable
to be decreed. The purchase for a pre-determined nominal
price of Re 1, irrespective of the actual market value was not
a sale by public auction as contemplated bys. 167 of the Bombay
Land Revenue Code.
An auction is a proceeding at which
people are invited to compete for purchase of property by
successive offers of advancing surr1s and a sale by auction is a
means of ascertaining what the property is worth i.e. its fair
1 S.C.R. SUPREME COURT REPORTS
323
market price. If at the sale there are no bids there cannot be
a sale. The Government Order had no statutory force at all,
and could not authorise or render valid the transaction if
otherwise it lacked a legal basis.
There was no provision in the
Code 'vhich authorised such a course which an1ounted to for-
feiture of the property of a defaulter. It was anomalous that
the Collector who moved the machinery for realisation of
arrears by sale and who was constituted the authority to deter-
mine judicially allegation of irrel{ularity in the conduct of the
sale should, wit~out authority of any statutory power, bid at
the auction conducted by his deputy. The mere fact that the
appellant had been informed before hand of the nominal bid
did not render the sales valid. Nor was the appellant estopped
from questioning the legality of the sales.
Tumdu Dhansing v. Government for the Provine' of Bombay,
I.LR. 1947 Born. 75, approved.
The suit was not barred hv Art. 11 of the Limitation Act.
The article was applicable only to cases where there was need
for setting aside a sale and not to cases where no sale as con-
templated by law had taken place.
The provisions s. 4(c) Bombay Revenue Jurisdiction Act,
1876 applied to cases where there was a sale and it was sought to
be set aside on the ground of irregularities other than fraud.
They did not apply where there was only a purported sale
which did not pass title.
Section 11 barred a suit when there
was an appeal provided against the act or omission of a revenue
officer and the party failed to avail of the remedy.
In the
p~sent case there was no order which was appealable under
s. 203 and s. 11 could not be applied.
There was no scope for invoking the aid of s. 41 Trans-
fer of Property Act. The purchasers had not relied upon any
representation, act or conduct of the appellants but on the
belief that Government had acquired a good title to the lands.
If t~e Government had no title the purchasers could not
acquire any.
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