G SRINIVASA REDDY Vs. COMMISSIONER FOR EXCISE

JUDGEMENT

(1.) The right to vend foreign liquor' in the three 'foreign liquor' shops in Nizamabad City during the Abkari year 1967-68 was sold by Public Auction on 20th July, 1957. The petitioner's bids of Rs 1,09,000 and Rs. 90,000 for shop Nos. 1 and 2 were the highest bids for those two shops and the bids were provisionally accepted by the Collector, Nizamabad. The bid-lists were signed by the petitioner and the Collector. According to the petitioner the bids offered by him for shop Nos. 1 and 2 were offered on the basis that shop No. 3 would be located at the same place where it was located during the previous year. Shortly after the auction he learnt that the location of shop No; 3 was to be changed to a place very near shop No. 2, As such a change would substantially affect the custom of both shop Nos. I and 2, the petitioner issued notices on 27-7-1967 to the Excise Commissioner, Collector etc, objecting to the change and further informing them that if the location of shop No. 3 was changed, his bids for shop Nos- 1 and 2 would stand withdrawn and cancelled; As no reply was received from the Collector or Excise' Commissioner the petitioner issued another notice to them through his lawyer on 7-8-1967 revoking his bids for shop Nos, 1 and 2. The petitioner claimed that he was entitled to do so at any time before the auction become final and under condition No. 8, of the conditions of Auction of the privilege of sale of Hyderabad made Foreign Liquor Shops) and condition No. 9 of the General 'Conditions of the Auction of the Privilege of sale of Intoxicants' and auction become final oh the expiration of 30 days from the date of auction unless in the meanwhile the auction stayed or cancelled by the Excise Commissioner; The petitioner therefore claimed that he was within his rights in withdrawing his offers before the expiry of 30 days from the date of auction. Consequent on the withdrawal of bids by the petitioner, the two shops had to be auctioned again and at the reauction the shops fetched highest bids of Rs 57,000 - and Rs. 42,000 -only respectively. The Government suffered a loss of revenue and after making a demand upon the petitioner to make good the loss, initiated proceedings under the Andhra Pradesh Revenue Recovery Act to recover the amount as an arrear of land revenue. The petitioner thereupon invoked the jurisdiction qf this Court under Article 226 of the Constitution for the issue of Writ or direction restraining the respondents from demanding or recovering the amount from the pttitioner.

(2.) Sri B. P. Jeevan Reddy, learned counsel far the petitioner, urged that under condition No. 8 of the 'Conditions of Auction of the Privilege of sale of Hyderabad made Foreign Liquor Shops' and condition No. 9 of the Genenl Conittions of Auction of the Privilege of sale of intoxicants, the auction did not become final until alter the expiry of 30 dsys from the date of auction and the petitioner had the right to revoke his bid at any time before it was finally accepted. The Government could not therefore seek to recover from the petitioner any alleged damage suffered by it as a result of the reauction. He relied on the decision of Jaganmohan Reddy , and Cbandrasekhara Sastry. JJ in RAGHUNANDA REDDY V. STATE OF HYDERABAD(1) On the other hand Sri, C. Seetharamaiah, who appared for the Government Pleader, submitted that the conditions of sale had statutory force and they displaced the ordinary rule of the Law of contracts that an offe r might be revoked at any time before acceptance. Sri Seetharamaiah drew my attention to the relevant statutory provisions and rules.

(3.) Sections 2, 3, 5, 7, 12, 13 and 15 in so far as they are relevant for the purposes of the present case read as follows i