Court rules cancellation of auction proceedings without valid reasons violates constitutional principles of fairness and transparency.
In a significant judgment, the Rajasthan High Court has set aside the Rajasthan Housing Board's decision to cancel auction proceedings without providing any reasons, declaring the action arbitrary and unconstitutional. The court's decision was delivered in a batch of writ petitions, including the lead case of Javari Lal v. State of Rajasthan, challenging the cancellation of allotments to successful bidders in an auction conducted under the Tausar Road Residential Scheme in Nagaur.
Justice Farjand Ali, presiding over the case, emphasized the necessity of reasoning as the fundamental principle underlying any administrative or judicial decision that has civil consequences. The judgment underscored that the Rajasthan Housing Board's failure to articulate reasons for the cancellation of the auction proceedings violated Articles 14 and 300-A of the Constitution of India, which uphold the principles of equality and protection of property, respectively.
The court found that the Housing Board's decision lacked transparency and fairness, as no discernible or cogent reasons were provided for the cancellations. The court further observed that the discretionary powers exercised by the board were not synonymous with absolute authority and required adherence to legal and constitutional boundaries.
Justice Ali noted that the auction proceedings had met all the necessary conditions of fairness, including adequate participation and adherence to the notified procedures. The bids were substantially higher than the reserve prices, and there was no evidence of procedural irregularity, cartelization, or lack of competition. The court held that in the absence of any recorded reasons demonstrating procedural irregularity, bias, or lack of fairness, the cancellation of the auction was arbitrary and unsustainable.
The judgment directed the Rajasthan Housing Board to restore the petitioners' allotments and proceed in accordance with the law, ensuring compliance with remaining formalities. The decision reinforces the doctrine of non-arbitrariness in administrative actions, highlighting the necessity for public authorities to act within the confines of reason, fairness, and accountability.
Bottom Line:
Cancellation of auction proceedings without assigning reasons or following principles of natural justice is arbitrary, violates Articles 14 and 300-A of the Constitution, and cannot be sustained.
Statutory provision(s): Articles 14, 300-A of the Constitution of India, Principles of natural justice, Rajasthan Housing Board (Disposal of Property) Regulations, 1970 and 1973, Right to Information Act, 2005
Javari Lal v. State of Rajasthan, (Rajasthan) : Law Finder Doc Id # 2838628
