Karnataka High Court
Arun Kumar vs The State Of Karnataka on 25 October, 2021
Author: M.Nagaprasanna
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 25TH DAY OF OCTOBER, 2021 R
BEFORE
THE HON'BLE MR. JUSTICE M. NAGAPRASANNA
WRIT PETITION No.18567/2021 (LB - RES)
WRIT PETITION No.18968/2021 (LB - RES)
WRIT PETITION No.18983/2021 (LB - RES)
WRIT PETITION No.18989/2021 (LB - RES)
WRIT PETITION No.18960/2021 (LB - RES)
WRIT PETITION No.18969/2021 (LB - RES)
IN W.P.NO.18567/2021
BETWEEN
1. SRI. ARUN KUMAR
AGED ABOUT 52 YEARS
S/O SHANTHA GUPTA
R/O PETE ARKALGUD
ARKALGUD - 573 201.
2. SRI. SYED LIYAKATH
S/O ABDUL JABBAR
AGED ABOUT 38 YEARS
K E B ROAD
PETE ARKALGUD
HASSAN DISTRICT - 573 102.
3. SAGEER AHAMAD
SRI. NOORULLA KHAN
S/O SAGEER AHMAD
AGED ABOUT 45 YEARS
K E B ROAD PETE ARKALGUD
HASSAN DISTRICT - 573 102.
2
4. SRI. ABDULLA KHAN
SINCE DEAD BY LRS
AMARULLA KHAN
AGED ABOUT 25 YEARS
K E B ROAD
PETE ARKALGUD
HASSAN DISTRICT - 573 102
5. SRI. DODDANNA
S/O MOTAIAH
AGED ABOUT 50 YEARS
K E B ROAD
PETE ARKALGUD
HASSAN DISTRICT - 573 102
6. SRI M R VENKATESHA
S/O RAMEGOWDA
AGED ABOUT 52 YEARS
K E B ROAD
PETE ARKALGUD
HASSAN DISTRICT - 573 102
... PETITIONERS
[BY SRI.JAYAKUMAR S PATIL, SENIOR ADVOCATE A/W
SRI.MOHAN P.S., ADVOCATE
(PHYSICAL HEARING)]
AND
1. THE STATE OF KARNATAKA
REPRESENTED BY ITS SECRETARY
DEPT OF MUNICIPAL ADMINISTRATION
VIKASA SOUDHA
BANGALORE - 560 001
2. THE DEPUTY COMMISSIONER
HASSAN DISTRICT
HASSAN - 573 102
3
3. ARKALGUD TOWN PANCHAYATH
ARKALGUD TOWN
HASSAN DISTRICT - 573 201
REPRESENTED BY ITS CHIEF OFFICER
... RESPONDENTS
[BY SRI.NITHYANANDA K.R., HCGP FOR R1 AND R2
(PHYSICAL HEARING);
SRI.H.T.NATARAJ, ADVOCATE FOR R3
(PHYSICAL HEARING)]
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND
227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE
IMPUGNED AUCTION NOTICE DATED 20.09.2021 AT ANNEXURE-E
ISSUED BY THE R3 HEREIN.
IN W.P.NO.18968/2021
BETWEEN
1. SRI MANJEGOWDA
AGED ABOUT 52 YEARS
S/O NINGEGOWDA
R/O SWEEPERS COLONY
ARKALGUD TOWN
ARKALGUD 573201
2. SRI. GOWDEGOWDA
AGED ABOUT 62 YEARS
S/O KARIGOWDA
R/O P. CHAKANAHALLI
DODDAMAGGE HOBLI,
ARKALGUD TALUK
HASSAN DISTRICT 573201
3. SRI. MANJUNATHA
AGED ABOUT 52 YEARS
S/O HUCHEGOWDA
R/O HENTAGERE ROAD
4
PETE ARKALGUD
ARKALGUD 573201
4. SRI. H.T. LOKESH
AGED ABOUT 48 YEARS
S/O THIMMEGOWDA
R/O HENTAGERE ROAD
PETE ARKALGUD
ARKALGUD 573201
... PETITIONERS
[BY SRI.JAYAKUMAR S PATIL, SENIOR ADVOCATE A/W
SRI.MOHAN P.S., ADVOCATE
(PHYSICAL HEARING)]
AND
1. THE STATE OF KARNATAKA
REPRESENTED BY ITS SECRETARY
DEPT OF MUNICIPAL ADMINISTRATION
VIKASA SOUDHA
BANGALORE - 560 001
2. THE DEPUTY COMMISSIONER
HASSAN DISTRICT
HASSAN - 573 102
3. ARKALGUD TOWN PANCHAYATH
ARKALGUD TOWN
HASSAN DISTRICT - 573 201
REPRESENTED BY ITS CHIEF OFFICER
... RESPONDENTS
[BY SRI.NITHYANANDA K.R., HCGP FOR R1 AND R2
(PHYSICAL HEARING);
SRI.H.T.NATARAJ, ADVOCATE FOR R3
(PHYSICAL HEARING)]
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND
227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE
5
IMPUGNED AUCTION NOTICE DATED 20.09.2021 AT ANNEXURE-J
ISSUED BY THE R3 HEREIN.
IN W.P.NO.18983/2021
BETWEEN
1. SRI NAGARAJU
S/O LATE SANNAIAH
AGED ABOUT 52 YEARS
R/AT HEMBIGERE
ARKALGUD TOWN
HASSAN DISTRICT 573201
2. BHAVARALAL
S/O RAMOJI
AGED ABOUT 38 YEARS
R/AT ARKALGUD
NARASINGARAYA KRISHNARAYA LAYOUT
KOTE, ARKALGUD TOWN
HASSAN DISTRICT 573201
HASSAN.
3. SRIDHARA
S/O SUBBARAYASHETTY
AGED ABOUT 48 YEARS
R/AT PETE MAIN ROAD
ARKALGUD TOWN
HASSAN DISTRICT 573201
HASSAN
4. M T JAYALAKSHMI
W/O A P MOHANKUMAR
AGED ABOUT 40 YEARS
R/AT PETE MAIN ROAD
ARKALGUD TOWN
HASSAN DISTRICT 573201
HASSAN
6
5. SMT. SUNITHA
W/O ANNAPPA
AGED ABOUT 38 YEARS
RA/T CHOLENAHALLI VILLAGE
KASABA HOBLI
ARKALGUD TALUK
HASSAN DISTRICT 573201
HASSAN
6. A.N. SUBBANNA
S/O LATE A P NAGAPPA
AGED ABOUT 50 YEARS
R/AT PETE MAINROAD
ARKALGUD TOWN
HASSAN DISTRICT 573201
HASSAN
7. VENKATESH
S/O RANGAIAH
AGED ABOUT 48 YEARS
R/AT HOUSING BOARD
ARKALGUD
HASSAN DISTRICT 573201
HASSAN
8. MAQBUL AHAMED
S/O CHOTASAB
AGED ABOUT 58 YEARS
R/AT MUSLIM ROAD PETE
ARKALGUD
HASSAN DISTRICT 573201
HASSAN
9. A G BHASKAR
S/O GANGADHARAIAH
AGED ABOUT 35 YEARS
KEB ROAD, ARKALGUD
HASSAN DISTRICT 573201
HASSAN
7
10. B C SHEKAR
S/O CHANNAPPA SHETTY
AGED ABOUT 40 YEARS
R/AT BASAVANAGUDI ROD
ARKALGUD
HASSAN DISTRICT 573201
HASSAN
11. A H RAJANNA
S/O HANUMANTHEGOWDA
AGED ABOUT 50 YEARS
R/O TELAGAVE ROAD
PETE ARKALGUD
HASSAN DISTRICT 573201
HASSAN
12. M R RAMESH
S/O RAMEGOWDA
AGED ABOUT 40 YEARS
R/O KOTE, ARKALGUD
HASSAN DISTRICT 573201
HASSAN
13. BASAVARAJU M A
S/O ANNEGOWDA
AGED ABOUT 50 YEARS
LIBRARY ROAD, ARKALGUD
HASSAN DISTRICT 573201
HASSAN.
... PETITIONERS
[BY SRI.JAYAKUMAR S PATIL, SENIOR ADVOCATE A/W
SRI.MOHAN P.S., ADVOCATE
(PHYSICAL HEARING)]
AND
1. THE STATE OF KARNATAKA
REPRESENTED BY ITS SECRETARY
DEPT OF MUNICIPAL ADMINISTRATION
8
VIKASA SOUDHA
BANGALORE - 560 001
2. THE DEPUTY COMMISSIONER
HASSAN DISTRICT
HASSAN - 573 102
3. ARKALGUD TOWN PANCHAYATH
ARKALGUD TOWN
HASSAN DISTRICT - 573 201
REPRESENTED BY ITS CHIEF OFFICER
... RESPONDENTS
[BY SRI.NITHYANANDA K.R., HCGP FOR R1 AND R2
(PHYSICAL HEARING);
SRI.H.T.NATARAJ, ADVOCATE FOR R3
(PHYSICAL HEARING)]
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND
227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE
IMPUGNED AUCTION NOTICE DATED 20.09.2021 AT ANNEXURE-L
ISSUED BY THE R3 HEREIN.
IN W.P.NO.18989/2021
BETWEEN
1. SMT JAYAMMA
AGED ABOUT 55 YEARS
W/O LATE NAGARAJ
HENTAGERE KOPPALU
ARKALGUD POST
HASSAN DIST 573201
2. SRI SANNEGOWDA
AGED ABOUT 45 YEARS
S/O HONCHEGOWDA
R/O HULANGALA VILLAGE AND POST
KASABA HOBLI
9
ARKALGUD TALUK
HASSAN DIST 573201
3. SRI THIMMEGOWDA
AGED ABOUT 55 YEARS
S/O PUTEGOWDA
PETE MACHAGONAHALLI
ARKALGUD POST
ARKALGUD TALUK
HASSAN DIST 573201
... PETITIONERS
[BY SRI.JAYAKUMAR S PATIL, SENIOR ADVOCATE A/W
SRI.MOHAN P.S., ADVOCATE
(PHYSICAL HEARING)]
AND
1. THE STATE OF KARNATAKA
REPRESENTED BY ITS SECRETARY
DEPT OF MUNICIPAL ADMINISTRATION
VIKASA SOUDHA
BANGALORE - 560 001
2. THE DEPUTY COMMISSIONER
HASSAN DISTRICT
HASSAN - 573 102
3. ARKALGUD TOWN PANCHAYATH
ARKALGUD TOWN
HASSAN DISTRICT - 573 201
REPRESENTED BY ITS CHIEF OFFICER
... RESPONDENTS
[BY SRI.NITHYANANDA K.R., HCGP FOR R1 AND R2
(PHYSICAL HEARING);
SRI.H.T.NATARAJ, ADVOCATE FOR R3
(PHYSICAL HEARING)]
10
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND
227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE
IMPUGNED AUCTION NOTICE DATED 20.09.2021 AT ANNEXURE-K
ISSUED BY THE R3 HEREIN.
IN W.P.NO.18960/2021
BETWEEN
1. SMT KAMALAMMA
W/O SRI DYAVAPPA GOWDA
AGED ABOUT 57 YEARS
HEMTAGERE ROAD
ARKALGUD TALUK
HASSAN DISTRICT-573102
2. SMT SUSHEELAMMA
AGED ABOUT 52 YEARS
W/O LATE SRINIVAS
K E B ROAD, PETE
ARKALGUD
HASSAN DISTRICT-573102
3. SMT KAMAKSHAMMA
AGED ABOUT 55 YEARS
W/O LATE ANNAJI GOWDA
HENTAGERE ROAD, ARKALGUD
HASSAN DISTRICT-573102
... PETITIONERS
[BY SRI.NAGAIAH., ADVOCATE
(PHYSICAL HEARING)]
AND
1. THE STATE OF KARNATAKA
DEPARTMENT OF MUNICIPAL ADMINISTRATION
VIKASA SOUDHA
BANGALORE - 560 001
REPRESENTED BY ITS SECRETARY.
11
2. THE DEPUTY COMMISSIONER
HASSAN DISTRICT
HASSAN - 573 102
3. ARKALGUD TOWN PANCHAYATH
ARKALGUD TOWN
HASSAN DISTRICT - 573 201
REPRESENTED BY ITS CHIEF OFFICER/
ADMINISTRATIVE OFFICER.
... RESPONDENTS
[BY SRI.NITHYANANDA K.R., HCGP FOR R1 AND R2
(PHYSICAL HEARING);
SRI.H.T.NATARAJ, ADVOCATE FOR R3
(PHYSICAL HEARING)]
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND
227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE
AUCTION NOTIFICATION THROUGH E-PROCUREMENT DATED
20.9.2021 ISSUED BY THE R3 VIDE ANNEXURE-S AND ETC.
IN W.P.NO.18969/2021
BETWEEN
1. SRI PAPANNA @ LAKSHMEGOWDA
AGED ABOUT 61 YEARS
S/O SANNAPPA,
R/O AN. NA. KRU. CIRCLE
PETE ARKALGUD
ARKALGUD-573201
HASSAN - 573 102
2. SRI NAVAB
AGED ABOUT 45 YEARS
S/O MOHAMMED GROUSE
R/O K E B ROAD
PETE ARKALGUD, ARKALGUD,
12
HASSAN -573102
3. SRI ANNEGOWDA
AGED ABOUT 55 YEARS
S/O KULLEGOWDA
PETE MACHAGOWDANAHALLI
ARKALGUD-573201
HASSAN -573102
4. SMT BHAGYAMMA
AGED ABOUT 47 YEARS
W/O SHIVANANJAPPA
R/O AA.NA.KRU EXTENSION
FORT ARKALGUD, ARKALGUD
HASSAN -573102
5. SRI SWAMYGOWDA
AGED ABOUT 53 YEARS
S/O KALEGOWDA
R/O AA.NA.KRU EXTENSION
FORT ARKALGUD, ARKALGUD
HASSAN - 573102
6. SRI KRISHNEGOWDA
AGED ABOUT 55 YEARS
S/O RANGEGOWDA
R/O AA. NA. KRU. EXTENSION
FORT ARKALGUD, ARKALGUD
HASSAN -573102
7. SRI H S SATHISH KUMAR
AGED ABOUT 43 YEARS
S/O SHIVAPPA
R/O HENTAGEREKOPPALU
PETE ARKALGUD, ARKALGUD
HASSAN -573102
8. SRI MUZAHID SAB
AGED ABOUT 45 YEARS
S/O AMIR SAB
13
R/O K E B ROAD
PETE ARKALGUD
ARKALGUD
HASSAN - 573102
9. SRI DHARMEGOWDA
AGED ABOUT 45 YEARS
S/O DEVARAJEGOWDA
R/O KEB ROAD, PETE ARKALGUD
ARKALGUD
HASSAN -573102
... PETITIONERS
[BY SRI. NAGAIAH., ADVOCATE
(PHYSICAL HEARING)]
AND
1. THE STATE OF KARNATAKA
DEPARTMENT OF MUNICIPAL ADMINISTRATION
VIKASA SOUDHA
BANGALORE - 560 001
REPRESENTED BY ITS SECRETARY.
2. THE DEPUTY COMMISSIONER
HASSAN DISTRICT
HASSAN - 573 102
3. ARKALGUD TOWN PANCHAYATH
ARKALGUD TOWN
HASSAN DISTRICT - 573 201
REPRESENTED BY ITS CHIEF OFFICER/
ADMINISTRATIVE OFFICER
... RESPONDENTS
[BY SRI.NITHYANANDA K.R., HCGP FOR R1 AND R2
(PHYSICAL HEARING);
SRI.H.T.NATARAJ, ADVOCATE FOR R3
(PHYSICAL HEARING)]
14
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND
227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE
AUCTION NOTIFICATION THROUGH E-PROCUREMENT
DTD.20.9.2021 ISSUED BY THE R-3 VIDE ANNEXURE-V AND ETC.
THESE WRIT PETITIONS COMING ON FOR ORDERS THIS DAY
THE COURT MADE THE FOLLOWING:
ORDER
Petitioners in this batch of petitions, call in question an
auction notification issued by the 3rd respondent/Arkalgud Town
Panchayat, Arkalgud Town (hereinafter referred to as 'the
Panchayat' for short) seeking to auction 61 shops out of 112
shops which are under its control. The notification of auction is
issued on 20th September, 2021 seeking to auction lease of
shops on 28th, 29th and 30th October, 2021. A consequential
direction is also sought by issuance of a writ in the nature of
mandamus to consider their representations submitted for
extension of lease up to 2024.
2. Heard the learned Senior Counsel Sri Jayakumar S.Patil
representing the petitioners in most of the cases and
Sri Nagaiah, learned counsel for one of the petitioners, learned
Additional Government Advocate representing the State and its
authorities and Sri H.T.Nataraj, learned counsel appearing for
the Panchayat in all these cases.
3. Brief facts leading to the filing of the present petitions,
as borne out from the pleadings, are as follows:-
The petitioners claim that they are carrying on business in
the shops owned by the 3rd respondent/Panchayat for more than
25 years. Initially the shops were petty shops and thereafter the
Panchayat collected advance amounts from the occupants of
shops and constructed RCC roofed shops in place of petty
shops. After such construction the respective lessees, who were
in occupation of petty shops, continued to occupy the
constructed shops and carried on their business. The lease that
was entered into between the Panchayat and these petitioners
and the like came to an end in the year 2012.
4. On the lease coming to an end, options were called from
the occupiers of shops for extension of lease. It appears that
about 51 occupiers accepted the terms and conditions of lease
and 61 did not. The extension of lease was made by the
Panchayat on the basis of a circular issued by Government on
26th October 2009 directing that, in terms of Section 72(2) of the
Karnataka Municipalities Act, 1964 the lease of properties
coming under the control of Panchayats or the Municipalities, as
the case would be, can be extended as per the terms and
conditions stipulated in the said circular. The benefit of the
circular was given to about 51 occupiers and lease was extended
for 12 years from 1st April, 2012 by a resolution of the
Panchayat which was approved by the Deputy Commissioner,
Hassan on 18th November 2014 and a consequential order
extending the lease was also approved by the Deputy
Commissioner on 2nd February 2015. Therefore, the occupiers of
51 shops have continued to hold the shops on extended lease
based on the strength of a Circular dated 26th October 2009 for
another period of 12 years from 1st April, 2012.
5. The left out 61 occupiers approached this Court seeking
extension of lease and other benefits in several writ petitions.
The first of the orders that was passed by this Court was in
NAGARAJU AND OTHERS v. STATE OF KARNATAKA AND
OTHERS. Identical order was passed in the other writ petitions
in H.S. SATHISH KUMAR AND OTHERS v. STATE OF
KARNATAKA AND OTHERS1 -wherein this Court held as
follows:
"5. These petitions are disposed of with an
observation that when the public property is leased to
the public, it shall be for a particular period and after
the completion of the said period, the petitioners or the
persons in occupation of the said property have to
vacate the same. It is however directed that after
completion of the tenancy or lease period, the same
has to be notified and call for applications from the
interested persons and may allot on the basis of the
eligibility and reservations has to be made to the
backward classes. It has been observed from the
notice issued that initially, lease was granted to the
petitioners in the year 1982. It is directed that the
Authorities to issue public Notification calling for
prospective persons to make their applications and on
receiving the same, the Authorities on the basis of the
social justice, the same has to be dealt with.
With these observations, petitions stand
disposed of."
W.P.Nos. 18091 of 2016 and connected cases decided on 27th April 2016
This was the identical observation in both the aforesaid writ
petitions.
6. When things stood thus, certain communications were
issued against the petitioners and the like on 1st July 2019
directing that the petitioners shall vacate the shops on the
ground that the auction notice had been issued for holding
auction on 9th July, 2019. This was called in question by the
petitioners in Writ Petitions Nos.30078-30079 of 2019. A
learned single Judge of this Court by order dated 25th July, 2019
quashed the auction notification on the ground that there was
no justification for the Panchayat to have issued notification of
auction only in respect of 61 shops and a direction was issued to
strictly comply with the Government orders dated 14th August
2015 and 9th October 2015 which directed that a particular
mode of auction ought to be undertaken by the Deputy
Commissioner.
7. This was called in question by the Panchayat in Writ
Appeal No.3940 of 2019. A Division Bench of this Court by
Judgment dated 9th January, 2020 set aside the order dated
25th July 2019 passed in Writ Petition Nos.30078-30079 of 2019
of the learned single Judge solely on the conduct of the
petitioners who had violated the undertaking by not vacating the
shops or paying Rs.15,000/- as rent for the shops that were in
their occupation. The relevant observation of the Division Bench
is as follows:
"17. In our considered view, it is not required to
delve upon the competence of the issuance of auction
notification or as to whether the Deputy Commissioner
had delegated the same to the Chief Officer who had
issued the notification dated 9.7.2019. It is the
conduct of the petitioners which has to be considered.
The fact is that, it is these very petitioners who had
approached this Court in Writ Petition Nos.18000-
18003 of 2016 connected with Writ Petition Nos.9056-
65 of 2016 and this Court granted them one year time
upto 6.4.2017 to vacate the premises in question
failing which, the petitioners herein were to pay rent of
Rs.15,000/- per month and the same to be deposited
in this Court.
18. On a perusal of the records, it is clear that
the petitioners have neither paid the rent nor
deposited the same before this Court. Having failed to
do so, the petitioners acted contrary to the order
passed by this Court and chose to challenge the
subsequent notices as also the tender notification. It is
this act of the petitioners that would disentitle them to
the relief that the petitioners have got in the writ
petitions in terms of the order passed by the learned
Single Judge.
19. Having suffered an order before this Court
in Writ Petition Nos.18000-18003 of 2016 connected
with Writ Petition Nos.9056-65 of 2016 dated
6.4.2016, which became final, coupled with the fact
that the petitioners did not comply with the direction
made in the order by paying the rent of Rs.15,000/-
per month and depositing the same before this Court,
the petitioners could not have filed another writ
petition challenging the auction notification and the
notices issued to them. The conduct of the petitioners
ought to have been noticed by the learned Single
Judge as it was not the plea of the petitioners before
the learned Single Judge that the auction notification
was without competence. The writ petitions ought to
have been dismissed on the ground of conduct of the
petitioners and non-compliance of the order passed by
this Court in depositing the monthly rent of
Rs.15,000/- after the expiry of the time limit fixed in
the writ petitions, which was on 6.4.2017. In view of
the previous writ petitions initiated by the writ
petitioners, they have no right to challenge the
consequential proceedings.
20. In the circumstances, we are of the
considered view that an appropriate interference is
called for without going into the validity of the
Government Orders dated 9.10.2015 and 14.8.2015
as to who is the appropriate authority to issue the
auction notification. The writ petitions will have to be
dismissed only on the ground that the petitioners
could not have filed the instant writ petitions having
suffered an order of time limit for eviction coupled with
the fact of not complying with the directions issued in
those writ petitions, all of which had become final."
The aforesaid proceedings of this Court permitting the
petitioners and the like to continue paying Rs.15,000/- per
month or vacating the shops prior to notifying the public auction
notification have become final.
8. The petitions now filed are calling in question auction
notification issued on 20th September, 2021. The auction
notification refers to all the afore-quoted orders and directs
auction to be held in respect of 61 shops. This restricted auction
notification is called in question on various grounds.
9. The learned Senior Counsel representing the petitioners
would submit that if auction is to be held, it has to be held for
all the shops and not piecemeal in the manner that it is notified.
He would further contend that insofar as petitioners in Writ
Petition No.18567 of 2021 are concerned the Panchayat did not
prefer any writ appeal against the order passed in the writ
petition where the petitioners were parties and, therefore, would
submit that setting aside the order of the learned single Judge is
not binding on them as no appeal is preferred against the order
in their writ petition.
10. On the other hand, the learned counsel appearing for
the Panchayat would vehemently refute this submission and
contends that the petitioners cannot challenge the auction
notification having lost the legal battle before this Court. Insofar
as the submission that 51 shops are left out is concerned, the
learned counsel would submit that in the year 2012, on the
basis of the circular and direction of the Government, occupiers
of shops were granted extension of lease. He would admit that
such extension of lease was not by way of a public auction, but
was only on the strength of a circular, direction of the
Government and resolution of the Panchayat and would submit
that the extended period of lease of those occupiers would come
to an end on 31.03.2024. Therefore, those 51 shops are left out
of the notification. He would submit that objections filed in
Writ Petition No.18567/2021 be treated as objections filed in all
other connected cases and submissions made in aforesaid writ
petition also be taken as submissions in all cases.
11. The learned Additional Government Advocate would
also toe the lines of the Panchayat in aiding that Government
orders were issued in the year 2015, with regard to public
auction of the properties and extension of lease was granted in
the year 2012 or 2014, as the case would be. Therefore, the
circular what prevailed then and the extension of lease, cannot
be found fault with or any direction issued by Government at
that point in time was valid in law.
12. The submissions of the learned counsel appearing for
the Panchayat and the Additional Government Advocate are
unacceptable. The petitioners, though, have no right as on today
to continue in the shops that they are occupying for having lost
all their rights before this Court in the aforesaid writ petition.
What cannot be lost sight is that the public property coming
under precincts of the Panchayat has been bartered away on the
basis of a circular in the year 2012 without public auction.
There can be no justification for the Panchayat to have notified
the auction only for 61 shops and not the other 51 shops as the
extension of lease unilaterally on the strength of a circular
without calling for public auction was itself illegal. The illegality
cannot be perpetuated by partial auction of the properties
controlled by the Panchayat.
13. Auction of properties coming within the precincts of
the municipality is regulated by Section 72 of the Karnataka
Municipalities Act, 1964 ('Act' for short) and the Karnataka
Municipalities (Guidance of Officers, Grant of Copies and
Miscellaneous Provisions) Rules, 1966 ('Rules' for short).
Section 72 of the Act reads as follows:
"72. Competency of municipal council to
lease, sell and contract.--(1) Subject to the
conditions and restrictions contained in sub-
sections (2) to (9), and such other restrictions
and conditions as the Government may by
general or special orders specify, every
municipal council shall be competent to
lease, sell or otherwise transfer any movable
or immovable property which belongs to, or for
the purpose of this Act has been acquired by it,
and so far as is not inconsistent with the
provisions and purposes of this Act, to enter
into and perform all such contracts as it
may consider necessary or expedient in order
to carry into effect the said provisions and
purposes.
(2) No free grant of immovable property
whatever may be its value, no grant for an upset
price and no lease for a term exceeding five
years, and no sale or other transfer of immovable
property exceeding [twenty-five thousand] rupees in
value, shall be valid unless the previous sanction of
the Government is obtained."
(Emphasis supplied)
Rule 39 of the said Rules reads thus:
"39. Procedure in respect of lease, sale or
auction. - Save as otherwise provided in the Act or
rules, when the Municipal Council proposes to lease,
sell or auction any moveable or immoveable property,
it shall give notice of such lease, sale or auction by -
(i) affixing copies thereof on the notice board of
the offices of the Municipal Council;
(ii) exhibiting copies thereof in all municipal
reading rooms and places considered by the
Municipal Council to be conspicuous within the
municipality
(iii) publication in a daily newspaper having
wide circulation within the municipality;
(iv) by beat of drum or circulation of notice in the
locality."
A Division Bench of this Court in the case of MOHAN P SONU V.
STATE OF KARNATAKA2 considering the purport of Section 72
of the Act has held as follows:
"4. Section 72(1) and (2) at the relevant time,
read thus:
"72. Competency of Municipal Council to lease,
sell and contract.-(1) Subject to the conditions and
restrictions contained in sub-sections (2) to (9), and
such other restrictions and conditions as the
Government may by general or special orders specify,
every Municipal Council shall be competent to lease,
sell or otherwise transfer any movable or immovable
property which belongs to, or for the purpose of this
Act has been acquired by it, and so far as is not
inconsistent with the provisions and purposes of this
Act to enter into and perform all such contracts as it
may consider necessary or expedient in order to carry
into effect the said provisions and purposes.
(2) No free grant of immovable property whatever
may be its value, no grant for an upset price and no
lease for a term exceeding five years, and no sale or
other transfer of immovable property exceeding five
thousand rupees in value, shall be valid unless the
previous sanction of the Government is obtained."
Rule 39 of the said Rules, reads thus:
"39. Procedure in respect of lease, sale or
auction. - Save as otherwise provided in the Act or
rules, when the Municipal Council proposes to lease,
sell or auction any moveable or immoveable property,
it shall give notice of such lease, sale or auction by -
(ILR 1992 KAR 1219)
(i) affixing copies thereof on the notice board of
the offices of the Municipal Council;
(ii) exhibiting copies thereof in all municipal
reading rooms and places considered by the
Municipal Council to be conspicuous within the
municipality
(iii) publication in a daily newspaper having
wide circulation within the municipality;
(iv) by beat of drum or circulation of notice in the
locality."
We find it very difficult to uphold this
submission. The object of Rule 39 has been stated in
the Judgment of the learned single Judge of this Court
in Jaichand v. Town Municipality,
Robertsonpet [1976 (1) KLJ 30.] We are in agreement
with the view there expressed. The object of giving due
publicity to the proposal to dispose of rights in respect
of a property belonging to a local authority before it is
so disposed of is quite obvious. The publication is
necessary in order to realise the highest possible
income and to prevent persons in-charge of the
Municipal Council from disposing of the rights in
favour of persons in whom they are interested.
Disobedience of the provisions of Rule 39 can not be
overlooked. It is a mandatory rule intended to protect
public revenue. Matters relating to public revenue
cannot be dealt with arbitrarily and in the secrecy of
an office. Whatever done in that regard should be
done in accordance with law, which, in the instant
case, requires due publicity to be given to dispose of
the property in the prescribed manner.
5. Section 72 is a further safeguard.
Publicity given to the proposal of a Municipal
Council to dispose of property rights under Rule
39 would attract offers from persons interested
in acquiring such rights and these offers would
enable the State Government to decide whether
the sanction of the State Government that is
contemplated by Section 72 should or should not
be given. Rule 39 is, therefore, complementary to
Section 72 and both operate together.
6. In this view of the matter, we must hold
that the learned single Judge was right in
coming to the conclusion that the alienation of
the said land in favour of the appellant without
following the proper procedure set out by Rule 39
was bad in law.
... ... ... ...
8. In the result, the Appeal is dismissed.
The second respondent (the Municipal Council)
may alienate the said land following the
procedure set out in the said Rule 39 and the
said Section 72. The appellant shall be entitled
to retain the building that he has constructed
upon the said land for a period of six months
from today. In the event that the 2nd respondent
decides to alienate the said land as aforesaid and the
alienation is made in favour of the appellant, the
appellant shall not be bound by the undertaking to
demolish the said building. In the event, however, of
the appellant not securing a grant in his favour of the
said land within a period of six months from today,
??? appellant shall be bound, in accordance with the
undertaking given by him to Court and accepted by it,
to demolish the said building.
(Emphasis supplied)
Following the judgment in case of MOHAN P SONU (supra), a
Co-ordinate Bench of this Court in the case of CHIEF OFFICER
V. GUNASUNDARAMMANNI3, has held as follows:
"3. In the admitted facts there is no dispute that
the immovable properties being shops in a commercial
complex constructed by the TMC with financial
assistance from the State Financial Institutions, to be
refunded with interest were required to disposed of,
more appropriately the privilege to use the said shops
by way of leasehold rights, in a manner known to law
i.e., under Section 72 of the Karnataka Municipalities
Act, 1964, for short 'Act' r/w Rule 39 of the Karnataka
Municipalities (Guidance of Officers, Grant of Copies,
Miscellaneous Provisions) Rules, 1966, for short
'Rules', by public auction, since the said provisions
relate to competence of Municipal Council to sell, lease
or contract or otherwise transfer any immovable
property belonging to it and, the procedure in respect
thereof by auction and none other.
4. The declaration of law by a Division
Bench of this Court in Mohan P. Sonu v. State of
Karnataka [1992 (2) KLJ 245] in the
circumstances applies on all its fours. The Law
Lords held that the object of giving due publicity
to the proposal to dispose of rights in respect of
the property belonging to a local authority before
it is so disposed of is quite obvious
requiring publication in order to realise
the highest possible income and to prevent
persons in-charge of the Municipal Council from
disposing of the rights in favour of persons in
ILR 2015 KAR 2006,
whom they are interested, and further that
'Disobedience of the provisions' of Rule 39
cannot be overlooked. In addition it was noticed
that Section 72 of the Act, and Rule 39 of the
Rules were mandatory intended to protect public
revenue which cannot be dealt with arbitrarily
and in the secrecy of an office. It was further
observed that the aforesaid provisions would
attract offers from persons interested in
acquiring such rights and these offers would
enable the State Government to decide whether
sanction has to be given or otherwise as
contemplated by Section 72 and therefore, Rule
39 and Section 72 are complementary and
operate together.
(Emphasis Supplied)
5. Admittedly the Chief Officer, is said to be
placed under suspension by the Deputy Commissioner
after the agreement and compromise were entered
into. The agreement dated 14.3.2005 to dispose of
public properties more appropriately the leasehold
rights for a period of 12 years in favor of the
respondents is contrary to the Act and Rules supra.
Rights invested/created or extinguished in favour of
the respondents in the writ petitions so as to claim
privilege for use of the public properties as leasehold
rights by way of a private negotiation with the then
Chief Officer, other than by way of public auction, is
illegal and imperils Rule of law.
6. The agreement dated 14.3.2005 between
the Chief Officer of the TMC and the
respondents ex facie suffers from illegality and
borders around fraud on power. The provisions
of the Act and Rules being mandatory, the Chief
Officer, TMC had no jurisdiction or authority in
law to enter into the agreement, to do away with
public premises, in utter disregard to rule of law.
Moreover, the allotment of public premises must
confine to the mandate of Article 14 of the
Constitution of India. Suffice it to observe that
the agreement dated 14.3.2005 entered into by
the then Chief Officer with the respondents in
the petitions provides for illegal allotment
founded upon ultra vires and illegal act of the
Chief Officer.
7. Sequentially the compromise petition filed in
Mediation, following which O.S. 14/2009 was decreed
in terms thereof, is perpetuating an illegality, hence
the compromise decree being an illegal decree cannot
be legalized. The Chief Officer, TMC and respondents
perpetuated a fraud with the full knowledge of the law
as applicable in the disposal of public properties, in
other words abused judicial process to perpetuate
illegality by paving way for a compromise decree.
... ... ... ...
10. If regard is had to the aforesaid
observations and applying the same to the facts of
these petitions, undoubtedly it is beyond cavil of doubt
that the agreement dated 14.3.2005 Annexure-A
entered into between the then Chief Officer of the TMC
and respondents suffers from 'fraud on power' and
must stand negated. Sequentially it goes without
saying that the compromise decree dated 25.11.2011
based upon the terms and conditions of the
agreement, is also vitiated and cannot be allowed to
stand.
11. Learned Counsel for the respondents 2, 4, 5,
6 and 12 in W.P. 26755/2012, at this juncture,
submits that the respondents are legally entitled to
possession of the properties since the said agreement
states that they are entitled to possession of the
commercial complex strictly in accordance with law.
This submission of the Learned Counsel requires,
evidently consideration on two aspects. In the first
place the agreement did not confer and could not have
conferred any right to the privilege of use of the
commercial complex, being a public premises, by
respondents since neither Section 72 of the Act nor
Rule 39 of the Rules provide for such an agreement by
way of a private negotiation. In the second place since
the agreement specifically records that respondents
will be put in possession of the public premises,
strictly in accordance with law, then respondents
could not have enforced the decree, in execution, other
than by way of public auction, hence the taking of
possession of the public premises by breaking open
the locks, is illegal and unsustainable. Looking at it
from any angle, respondents could not have claimed a
better right than to participate in a public auction of
the privilege to use the public premises, by way of
lease, and therefore, the submission of the Learned
Counsel for the respondents 2, 4, 5, 6 and 12 is a
specious plea. If truly the said respondents did want
to secure possession of the said public premises
strictly in accordance with law, would have had to
await issue of a notification for auction of the privilege
to use the terms by the petitioner as required by law.
12. Learned Counsel for the respondents
submit that in terms of the circular dated
26.10.2009 Annexure-F of the State Government
the Town Municipal Council was permitted to
give on lease the public premises to the
respondents. If regard is had to the law declared
by the Division Bench in Mohanrsonu's
case (supra), it is needless to state that the
Circular instructions contrary to Section 72 of
the Act and Rule 39 of the Rules, are inoperative,
illegal and unenforceable. Even otherwise the
Circular when not supported by statute has no
force of law. Suffice it to notice that in State of
Madhya Pradesh v. G.S. Dall And Flour
Mills [1992 Supp (1) SCC 150 : AIR 1991 SC 772] ,
the Apex Court held that executive instructions
can supplement a statute, cover areas to which
statute does not extend but they cannot run
contrary to statutory provisions or whittle down
their effect. In Kerala Finance
Corporation v. Commissioner of Income
Tax [(1994) 4 SCC 375 : AIR 1994 SC 2416]
following the opinion of Mukhaiji, J. at the end
of para 42 in State Bank of
Travancore v. Commissioner of Income
Tax [(1986) 2 SCC 11 : AIR 1986 SC 757] , held
that "Circulars cannot detract from the Act". The
Apex Court held that Circulars of the Board
under Section 119 cannot override or detract
from the provisions of the Act, is concerned,
inasmuch as what Section 119 has empowered is
to issue orders, instructions or directions for the
"proper administration" of the Act or for such
other purposes specified in sub-Section (2) of the
section. Such an order, instruction or direction
cannot override the provisions of the Act; that
would be destructive of all the known principles
of law as the same would really amount to giving
power to a delegated authority to even amend
the provision of law enacted by Parliament.
13. Thus, the Circular dated 26.10.2009 of the
Urban Development Department, of the State, issuing
instructions and directions to the Authorities of the
local boards, being executive in nature, though,
required to be issued in aid of functioning of the Act
and with the object that the provisions of the Act are
properly administered, however, in the light of the
ambiguity noticed supra, has no force of law. That
circular insofar as it runs contrary to the Act & Rules,
creating rights and obligations of the statute do not
supplement the law."
(Emphasis supplied)
Therefore, on an analysis of the aforesaid provisions of the Act,
the judgment of the Division Bench and the order passed by the
Co- Ordinate Bench (supra), what can be unmistakably gathered
is that public properties coming under the precincts of the
Panchayat controlled by them, shall be let out on lease or rent
only by way of public auction. Both the aforesaid judgments,
one rendered by the Law Lords and the other by the Co-ordinate
Bench, are on consideration of Section 72 and its purport.
14. It is now germane to notice the orders passed by the
Division Bench between the very same parties in the subject writ
petitions. The Division Bench in the case of NAGARAJU AND
OTHERS v. THE STATE OF KARNATAKA 4 holds as follows:
"3.The instant writ petitions were filed seeking
to quash the notice dated 06.10.2015 issued by
respondent No.3 directing the petitioners to vacate
W.A.No.2273/2017 disposed on 26th February 2020
their respective shops and hand over vacant
possession within seven days. The learned Single
Judge by placing reliance on the earlier order passed
in Writ Petition No.9056 of 2016, disposed off the Writ
Petitions by granting one years time to vacate the
premises. Among other consequential directions, the
said order is sought to be challenged herein.
4. The appellants' Counsel submits that the
order passed by the learned Single Judge, is
erroneous. That they are entitled to continue in the
premises.
5. The same is disputed by the respondents'
Counsel.
6. On hearing learned Counsels, we do not find
any merit in this appeal. A series of writ petitions on
the same question of law and facts were considered
by this Court. By placing reliance on the earlier
Government Order, it was held that all public
properties require to be auctioned. The question of
granting lease for whatever period or for
whatever rent is opposed to the Government
order. These are consistent orders being passed
that wherever, public properties are involved, it
has to be auctioned. Therefore, the same is also
applicable to the instant case.
7. Under these circumstances, the order dated
06.04.2016 passed in Writ Petition Nos.18000-18003
of 2016 connected with Writ Petition Nos.9056-65 of
2016 by the learned Single Judge, is set aside. The
petitioners shall hand over the vacant possession of
the premises to the concerned respondents.
8. At this stage, the appellants' Counsel, on
instructions, undertakes to vacate the premises before
the public auction takes place. The undertaking is
taken on record."
(Emphasis supplied)
Therefore, the right of the petitioners to continue in the shops is
absolutely bleak and they cannot, on any pretext, continue in
the shops by paying meagre rent, as is submitted. The occupiers
of other 51 shops also have not derived any right to continue in
those shops on the strength of an illegal extension of lease again
by paying a meagre rent. This is also as submitted. What is at
stake by the act of the Panchayat is a huge loss of revenue to the
Panchayat itself. When the law was clear way back in the year
1992 that the properties of Municipalities should be parted by
way of public auction and several orders having been passed by
this Court that all those properties should be leased out by way
of public auction, the piecemeal auction by the Panchayat
cannot be accepted. The Division Bench in the case of
H.S.SATHISH KUMAR AND OTHERS VS. STATE OF
KARNATAKA5 filed by several occupiers of shops in the
Panchayat has held as follows:-
"6. On hearing learned Counsels, we do not find
any merit in this appeal. A series of writ petitions on
the same question of law and facts were considered
by this Court. By placing reliance on the earlier
Government Order, it was held that all public
properties require to be auctioned. The question
of granting lease for whatever period or for
whatever rent is opposed to the Government
order. These are consistent orders being passed
that wherever, public properties are involved, it
has to be auctioned. Therefore, the same is also
applicable to the instant case.
7. Under these circumstances, the order dated
27.04.2016 passed in Writ Petition No.18091 of 2016
and Writ Petition Nos.24126-24130 of 2016 by the
learned Single Judge, is set aside. The petitioners
shall hand over the vacant possession of the premises
to the concerned respondents.
8. At this stage, the appellants' Counsel, on
instructions, undertakes to vacate the premises before
the public auction takes place. The undertaking is
taken on record.
9. The petitioners shall vacate the premises
when the public auction is announced. It is also made
clear that, the petitioners will be permitted to
participate in the auction, only if all the rents due are
paid to the respondents."
(Emphasis supplied)
Writ Appeal No.4812 of 2017 disposed on 26th February 2020
The very same Division Bench in Writ Appeal No.1723 of 2017
has reiterated what was held in Writ Appeal No.4812 of 2017.
The Division Bench while holding that there was no merit in the
appeal, holds that the question of granting lease for whatever
period or for whatever rent is opposed to the Government order.
15. These are the consistent orders being passed wherever
public properties are involved for leasing out, holding that they
have to be auctioned. The question of partial auction defeats
the very Act, Rules, judgments of this Court and the
Government Orders concerning the Panchayat itself which was
issued on 16th October 2015, following a Government order
dated 14th August 2015. The Division Bench observes that any
extension of lease or any rent that is chargeable would be
contrary to the aforesaid Government order. Therefore, the
findings in the writ appeal are binding upon the Panchayat.
16. There are number of Municipalities, Town Panchayats
and Corporations; they own buildings, shops etc. located in their
precincts and controlled by them. There should be uniformity in
grant of lease. Such uniformity can come about only when there
is transparency in procedure; transparency in procedure can
come about only when the properties are put to public auction
and every citizen is permitted to participate in the auction. The
provisions of the Act and the Rules have to be so construed so
as to keep the individuals or a class interest subordinate to
larger public interest. Public bodies have a right to put the
properties belonging to them in auction and augment their
income and deal with it in a manner more advantageous to
them. Any direction not to hold auction or to renew the lease
will lead to monopoly. If such right is allowed it would amount
to nudging the other contenders. A few people cannot hold the
entire Town Municipal Council to ransom by getting into
properties and dictating their terms. Therefore, it is always
necessary and desirable that such rights are auctioned out by
way of public auction.
17. It is not in dispute that the earlier extension of lease in
favour 51 occupiers of shops was not by way of public auction. It
was a unilateral act on the part of the Panchayat to which the
public at large did not have opportunity to participate. It is,
therefore, contrary to law as laid down by the Division Bench
(supra) and violative of Article 14 of the Constitution of India.
The situation that has now emerged in the subject lis is that, if
the impugned auction is not interfered with , it would amount to
upholding partial auction and permitting perpetuation of
illegality, which would be contrary to the Act and the Rules. It
would also amount to validating the illegal action of the Council
in entering/renewing the lease of few of the occupiers without
auction of the shops which came about in the year 2012.
18. To bring about such uniformity in the present process,
I deem it appropriate to direct the Panchayat to conduct a public
auction of all the properties in the precincts of the Panchayat
controlled by it and not partial auction as is now sought to be
held. In the auction all the present petitioners and the
occupiers of shops who are not parties to the lease would
become entitled to participate along with general public. The
process of auction shall be conducted and the auction
purchasers shall be put in possession of the respective shops in
terms of the Government Order dated 19th July, 2019. Any
other contra indication in the said Government Order contrary
to the statute cannot be taken recourse to by the Panchayat.
19. Therefore, the Panchayat shall now issue an auction
notification to auction all the 112 shops that are with them and
permit participation of all the petitioners and the occupiers of 51
shops in the auction proceedings along with the general public.
The shops shall be allotted pursuant to the result of the auction
in terms of Government Order dated 19th July 2019.
20. For the aforesaid reasons, I pass the following:
ORDER
(i) Writ Petitions are allowed in part.
(ii) The impugned Auction Notification dated 20-09-2021
stands quashed.
(iii) The claim of the petitioners for extension of lease
upto the year 2024, stands rejected.
(iv) A Mandamus is issued to the 3rd respondent /
Panchayat to issue fresh auction notification,
notifying all the shops under its control and conduct
public auction.
(v) Successful bidders in the public auction shall be
allotted shops in terms of Government order dated
19th July, 2019.
(vi) Till the auction notification is issued and the auction
purchasers are put in place, the petitioners or the
occupiers of shops in the 51 shops shall not be
disturbed from their respective possession of shops.
(vii) The present petitioners in all these petitions, if they
are in occupation of any of the shops shall continue
till a fresh auction notification is issued in terms of
direction Nos.(iv) and (v) being complied with, subject
to them paying the rent demanded by the Panchayat
or the rent that is being paid by the other 51
occupiers of the shops. In the event, the rents are
not paid, the benefit of continuance cannot be
claimed by those occupiers of the shops.
(viii) No equity shall be claimed by the petitioners in these
petitions for their continuance, till such auction
notification and its completion.
Sd/-
JUDGE
bkp
CT:MJ
