STATE OF KERALA Vs. JOY

JUDGEMENT

(1.) THE three appeals by the common defendants arise out of three suits by different plaintiffs. THE defendants are the State of Kerala and the Deputy conservator of Forests, Kottayam. THE facts of all the cases are similar. THE government had by Ext. Al notification dated 6-2-1973 published in the Gazette notified the auction sale of tree-growth in different sub coupes in the nagarampara range of the Kottayam forest division. THE notification provided that auction sale of the tree-growth will be subject to the general conditions of auction applicable to sale of tree-growth in forest coupes. One of the general conditions admitted by the parties as can be gathered from the plaints in the three different suits is that the bid representing the offer for purchase will be kept firm for a period of three months to enable the conservator of Forests to confirm the auction sale. Auction relating to the different coupes was held on 22-2-1973. THE plaintiffs in the three different suits were the highest bidders in respect of different coupes. Even though the plaintiffs had deposited one-third of the bid amount, they had not executed the agreements after their respective bids had been accepted and confirmed in terms of the general conditions of auction. THE respective coupes were re-auctioned on 12-12-1973 for much lesser price than offered by the respective plaintiffs at the previous auction. THE 2nd defendant by the notices issued to the plaintiffs forfeited the amounts deposited and also demanded of them to make good the loss sustained by the Government or re-auction of the different coupes. THE respective plaintiffs have filed these suits for declaration that there were no concluded contracts in these cases, for refund of the amounts deposited, and also for injunction restraining the defendants from taking proceedings against them for realisation of the loss sustained on re-auction of the respective coupes.

(2.) IT is not necessary to refer to all the contentions the parties have raised in these suits. The defendants rely on the general conditions of auction as per which the highest bidder at the auction is required to keep the offer firm for a period of three months to enable its confirmation by the Conservator of Forests. The bids by the three plaintiffs in respect of the respective coupes had been confirmed within the aforesaid period and the confirmation communicated to the plaintiffs. The plaintiffs are, therefore, not entitled to withdraw from or rescind the offer; and on acceptance of the offer, there is a concluded contract between the parties. Execution of formal agreement is only for the purpose of embodying the terms of the contract already concluded between the parties. The contracts in all these cases having been concluded, it is not open to the plaintiffs to unilaterally rescind the same and claim refund of the amounts deposited in pursuance to the auction sale. The defendants have also raised a contention that except in O. S no. 322/1975 there was no communication revoking the offer by way of the highest bid by the respective plaintiffs before its confirmation by the Conservator of forests. The revocation according to the defendants is also of no avail in view of the general conditions of auction.

(3.) IN the decisions in K. P. Chowdhary's case and mulamchand's case the Supreme Court has clearly held that Art. 299 (1) applies to contracts relating to the sale of timber and other forest produce. Such contracts are not executed under any statutory power. These are contracts executed by the State in exercise of its executive power. IN the absence of a formal agreement in terms of Art. 299 (1), there is no valid contract enforceable at law.