Mohd. Akram vs Nagar Palika Parishad Milak ...
2017 Latest Caselaw 5337 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

A.F.R.
 

 
Court No. - 37
 

 
Case :- WRIT - C No. - 37786 of 2006
 

 
Petitioner :- Mohd. Akram
 
Respondent :- Nagar Palika Parishad Milak Tehsil And Others
 
Counsel for Petitioner :- A.K. Sachan
 
Counsel for Respondent :- C.S.C.
 

 
Hon'ble Amreshwar Pratap Sahi,J.

Hon'ble Saral Srivastava,J.

Heard Sri A.K. Sachan, learned counsel for the petitioner and the learned Standing Counsel for the respondent nos. 2, 3 and 4. A counter affidavit has been filed on behalf of the respondent no. 1 to which a rejoinder affidavit has been filed by the learned counsel for the petitioner.

The challenge raised in this writ petition is to the realization of the amount of contract which the petitioner has defaulted to deposit as arrears of Teh Bazari on the ground that Teh Bazari not being a tax, the same cannot be recovered as arrears of land revenue. Learned counsel submits that Section 173-A of the U.P. Municipalities Act, 1916 read with Section 293 thereof, does not authorize the respondents to proceed to make any such recovery as arrears of land revenue, inasmuch as, the amount of money which was part of the auction bid in favour of the petitioner, is contract money, and is not tax or any other such sum which can be realized as arrears of land revenue. For this heavy reliance has been placed by the learned counsel for the petitioner on the Division Bench judgment in the case of Mohammad Umar Vs. Collector & others reported in 2006 Volume 3 AWC Pg 2412.

Learned counsel submits that in the absence of any such statutory authorization, as held in that case, the respondent-Nagar Palika Parishad and the state authorities cannot proceed with the impugned recovery and, accordingly, the Division Bench that had entertained the writ petition had rightly restrained the taking of any coercive steps for such realization by the interim order dated 1st August, 2006. It is further urged that in view of the ratio of the other Division Bench judgments referred to in the case of Mohammad Umar (supra) any such realization of contract money on principles has been found to be not relatable to arrears of land revenue and, consequently, the process adopted being contrary to law, the impugned recovery proceedings deserves to be set aside.

It is further submitted by Sri A.K. Sachan that there is no such concluded agreement on this aspect as well and, consequently, in the absence of a concluded agreement otherwise also such realization cannot be made from the petitioner as arrears of land revenue.

The writ petition did not contain either the terms and conditions of the auction or the terms and conditions of the agreement. A counter affidavit was filed by the respondent-Nagar Palika Parishad and in paragraph 4 of the counter affidavit it was brought forth that the terms and conditions of the auction that were settled prior to the holding of the auction proceedings and was part of the entire settlement to which the petitioner was a party, clearly, stipulates that any such default in payment of the auction bid amount shall be realizable as arrears of land revenue (MALGUZARI). Annexure No. CA-1 to the counter affidavit is a copy of the terms and condition of the contract that has been referred to in paragraph 4 of the counter affidavit. Clause 12 of the said terms and conditions is extracted hereinunder:-

"ठेका तहबाजारी की वकाया क़िस्त ठेकेदार समय पर जमा नहीं करता है तब नगर पालिका उसे वकाया मालगुजारी के रूप में वसूल करने के लिए सछम होगी "

The said clause, clearly, stipulates the realization of defaulted amount as arrears of land revenue by way of a condition imposed in the terms and condition of the auction bid, itself which is stated to be part of the contract.

The petitioner has filed a rejoinder affidavit and in paragraph 3 it has been stated that paragraph 4 of the counter affidavit is a matter of record and need no comments. Thus, the contents of paragraph 4 of the counter affidavit together with the annexure has not been disputed.

However, in paragraph 4 of the rejoinder affidavit the petitioner comes up with a plea that the aforesaid condition no. 12 does not allow the recovery of the amount as arrears of land revenue which is illegal and arbitrary.

One of the other arguments advanced by the learned counsel for the petitioner is that the respondents themselves practically admitted the breach of contract by not allowing the petitioner to operate the contract for the entire period, and had not made appropriate deductions for the period the petitioner had not been allowed to operate the contract. For this, Sri. A.K. Sachan has invited the attention of the Court to the averments made in the writ petition about a judicial intervention having been made in the matter in a writ petition filed by the petitioner, namely, Writ Petition No. 38355 of 2005. He, therefore, submits that the deprivation of the petitioner to operate the contract in its entirety for the period for which the auction was held also, clearly, establishes a breach and the same also cannot be made part of recovery that too as arrears of land revenue. The counter affidavit of the respondent no. 1 in para 8 thereof has refuted the said claim by stating the figures of accounting relating to deductions given to the petitioner.

We have considered the submissions raised and have perused the affidavit on record.

The two contentions that have been advanced on the strength of the judgment in the case of Mohammad Umar (supra) need not detain us as the issue is no longer res-integra, namely, even if there was no written contract executed after the auction bid, yet the aforesaid Division Bench judgment after having traversed this position of law and after considering the provisions of the Indian Contract Act came to the conclusion that once a bidder has participated in a public auction and has offerred the highest bid that has been accepted and the bidder has deposited the money, and the contract has been acted upon, then in that event there is a clear concluded contract, even if no formal agreement has been executed. Reference can be made to paragraphs 60 to 66 of the said judgment which are not being reproduced in order to avoid burdening this judgment with the extraction of the ratio thereof. Learned counsel for the petitioner has not been able to canvass any other position in law so as to take a contrary view.

Consequently, in the present case as well, once it is admitted that the terms and conditions of auction were the basis of the auction bid where the petitioner admittedly was the successful bidder, and have not been denied by the petitioner as indicated above then in that event Clause No. 12 is clearly operational and the petitioner having acted upon the contract by depositing the amount and having run the contract, was bound by a concluded contract.

The next question is with regard to the realization of the defaulted amount as arrears of land revenue. We are in agreement with the Division Bench judgment in the case of Mohammad Umar (supra) and to that extent, learned counsel for the petitioner is correct in his submission that in the absence of any such statutory provision, any amount of contract money cannot be realized as arrears of land revenue by taking recourse to Section 173-A read with Section 293 of the U.P. Municipalities Act, 1916 as arrears of land revenue.

However, the aforesaid judgment would not apply in so far as the present case is concerned, inasmuch as, the said judgment has proceeded on the facts that were placed in the cases that were being decided by the Bench where either there was no term and condition of contract or no executed contract or even otherwise no such concluded contract existed so as to impose the condition of realization of defaulted amount as arrears of land revenue. Thus, the present case is, clearly, distinguishable on facts and, therefore, the ratio of the said decision cannot come to the aid of the petitioner, inasmuch as, Clause 12 of the terms and conditions of the auction as reproduced hereinabove, and which has not been disputed by the petitioner, clearly binds the petitioner to the said condition. There is a concluded contract after his highest bid was accepted and he has run the contract for a certain period as admitted by the petitioner himself. In such a situation the realization as arrears of land revenue may not be relatable to the statutory provisions referred to hereinabove, but the realization as arrears of land revenue is clearly relatable to Clause 12 of the terms and condition of auction that forms part of a concluded contract between the parties. The respondents, therefore, cannot be said to be acting without authority in law in having proceeded to realize the defaulted amount as arrears of land revenue.

It has to be kept in mind that even if there is no statutory provision for realizing such defaulted amount of contract money as arrears of land revenue, the same is also not required as the amount sought to be recovered is not tax. The realization is not a statutory compulsory exaction and as observed above the dues are of contractual money arising out of an auction which is a transaction permissible under the relevant statutes. The terms and conditions of auction and the contract, therefore, can make a provision for realization of the defaulted amount as arrears of land revenue. Consequently, the recovery can still be made as arrears of land revenue even if the 1916, Act does not specifically provide for the same as the realization shall be in terms of Clause 12 refer to hereinabove. The said clause is neither contrary to nor prohibited from being made part of such a transaction either under the 1916, Act or any other law for the time being in force so as to declare the said condition to be arbitrary or illegal.

The third contention of the petitioner is about the period of contract he was unable to execute and realize Teh Bazari. From the counter affidavit, we find that this fact is also being disputed but this being a pure breach of the terms of the contract as alleged by the petitioner and denied by the respondents, it would not be appropriate for this Court to exercise jurisdiction under Article 226 of the Constitution of India to investigate the said facts or lead evidence. Thus, this issue can be agitated by the petitioner by taking recourse to common law remedy and, consequently, we are not inclined to interfere with the recovery proceedings for all the reasons stated hereinabove.

After the judgment was pronounced Sri. A.K. Sachan, learned counsel for the petitioner submitted that the petitioner may be permitted to deposit the entire recoverable amount for which some breathing time may be granted.

In view of the conclusions drawn above and the fact that it is not a tax, we in the special circumstances of the present case only provide that the petitioner shall be at liberty to deposit Rs.1,00,000/- within one month from today, and the balance of the entire amount within six months from today. In the event of any default of payment as above it shall be open to the respondents to proceed with the recovery forthwith.

The writ petition, therefore, fails and is hereby dismissed subject to the condition of deposit hereinabove. The interim order stands discharged.

Order Date :- 11.10.2017

S.Chaurasia