Sushil Kamalnayan Bharuka v. The State of Maharashtra
Background
The appellants were declared the highest bidders in an e-auction conducted by the Maharashtra Industrial Development Corporation (MIDC) for an industrial plot in Aurangabad, but MIDC later cancelled the entire bidding process citing unspecified complaints. The appellants' writ petition against this cancellation was dismissed by the Aurangabad Bench of the Bombay High Court, while, confusingly, the Principal Bench of the very same High Court had earlier ruled, on essentially identical facts involving other bidders for different plots, that the cancellation was improper and restored their bids.
Decision Breakdown
The Supreme Court found it untenable for two benches of the same High Court to reach contradictory conclusions on the same underlying issue. Relying on precedent that a fair public auction cannot be second-guessed absent proof of fraud, collusion, or genuine irregularity, the Court held that MIDC's cancellation was not justified and that the Principal Bench's more favourable ruling, which had already attained finality since MIDC did not challenge it, should be applied uniformly. It set aside the Aurangabad Bench's order and directed MIDC to complete the allotment and execute the sale deed to the appellants once they pay the balance amount within four weeks.
Lesson Learnt
A government body cannot cancel a public auction and deny the highest bidder the benefit of their bid without proof of fraud or serious irregularity, and courts must ensure consistency, so that the same legal question is not decided differently for different citizens by the same court.