Golden Food Products India v. State of Uttar Pradesh & Others
Background
A development authority cancelled a validly-won industrial plot auction, where the highest bid was 15% above reserve price, after quietly deciding, without notice, that unrelated, much smaller plots had sold for higher per-unit prices.
Decision Breakdown
The Supreme Court held comparing the large plot to unrelated smaller plots was arbitrary, and a hope for a higher price on re-auction is not valid grounds to cancel a lawful, fraud-free auction, especially without prior notice or hearing to the winning bidder.
Lesson Learnt
A government authority cannot cancel a validly conducted auction simply hoping for a higher price elsewhere, nor by comparing it to unrelated properties; affected bidders must get notice before an auction outcome is undone.