U.P. AVAS EVAM VIKAS PARISHAD & ORS.versusOM PRAKASH SHARMA

                     (2013] 6 S.C.R. 199

       U.P. AVAS EVAM VIKAS PARISHAD & ORS.                         A
                             v.
                  OM PRAKASH SHARMA
          (Civil Appeal Nos. 3908-3909 of 2013)
                       APRIL 18, 2013
                                                                    B
          [CHANDRAMAULI KR. PRASAD AND
               V. GOPALA GOWDA, JJ.]

     Contract Act, 1872 - ss. 3 and 4 - Auction of plot - Held
by Housing Board - Under supervision of an officer of the           C
Board - Plaintiff being the highest bidder deposited earnest
money - Later the bid amount rejected by the competent
authority - Suit filed to declare the rejection order as illegal
and void - Decreed by trial court - Decree set aside in first
appeal - High Court in second appeal confirmed the decree           D
- Held: Until final acceptance of the bid, the highest bidder
acquires no-vested right to have the auction concluded in his
favour - An authority falling under Article 12 of the
Constitution, is not bound to accept the highest bid in the
interest of public revenue - In the present case, since the final   E
bid was not accepted, there was no concluded contract in
favour of the highest bidder - Thus, no legal right accrued in
favour of the plaintiff to invoke remedy available u/s. 34 of
Specific Relief Act, seeking declaratory relief - Uttar Pradesh
Avas Evam Vikas Parishad Adhiniyam, 1965 - ss. 12 and               F
16 - Uttar Pradesh Avas Evam Vikas Parishad (Delegetion
of Powers by the Board and the Housing Commissioner)
Rules, 1968- r.3 - Constitution of India, 1950 - Article 12 -
Specific Relief Act, 1963 - s.34.

     Uttar Pradesh Avas Evam Vikas Parishad Adhiniyam,              G
1965 - s.88(2) - Suit against the Housing Board - Without
issuing notice - Maintainability of the suit - Held: Notice u/s.
88(2) is mandatory - Hence suit instituted without issuing
notice, not maintainable.
                             199                                    H
    200       SUPREME COURT REPORTS           [2013] 6 S.C.R.


A       Practice and Procedure - New plea - Raising of -
    Permissibility - Held: A plea on legal ground can be raised
    even at appellate stage.

       Appellant-authority conducted public auction of the
B plot in question, under supervision of Assistant Housing
  Commissioner of the appellant-authority. The respondent
  offered highest bid, and as per the terms and conditions
  of the auction, deposited the earnest money. Thereafter,
  the respondent was informed that the Housing
  Commissioner of the Board rejected the bid amount of
C the respondent.

      The respondent filed a suit seeking declaration that
  the auction held in favour of the respondent was binding
  on the appellant-Board and rejection thereof was illegal
D and void. Trial court decreed the suit. First appellate court
  allowed the appeal of the appellant-Board setting aside
  the decree. The High Court, in second appeal, confirmed
  the decree, setting aside order of first appellate court.
  Review against the order of the High Court was also
E dismissed. Hence the present appeal.

          Allowing the appeal, the Court

      HELD: 1.1. The bidder who has participated in tender
  process has no other right except the right to equality
F and fair treatment in the matter of evaluation of
  competitive bids offered by interested persons in
  response to the notice inviting tenders in a transparent
  manner and free from hidden agenda. So long as an order
  regarding final acceptance of the bid had not been
G passed by the Chairman of the Housing Board, the
  highest bidder acquires no vested right to have the
  auction concluded in his favour and the auction
  proceedings could always be cancelled. The 'State' or the
  Authority, which can be held to be a 'State' within the
H meaning of Article 12 of the Constitution, is not bound to
U.P. AVAS EVAM VIKAS PARISHAD v. OM PRAKASH 201
                   SHARMA
accept the highest tender/offer or bid and the                   A
Government could validly retain its power to accept or
reject the highest bid in the interest of public revenue.
[Paras 27 and 28] [219-H; 220-A; 221-C-E]
     1.2. The plaintiff-respondent had not acquired any          B
right and no vested right has been accrued in his favour
in respect of the plot in question, merely because his bid
amount was highest and he had deposited 20% of the
highest bid amount along with earnest money with the
Board. In the absence of acceptance of bid offered by the
plaintiff to the competent authority of the first defendant,     C
there is no concluded contract in respect of the plot in
question. [Para 29] [224-8]

     State of U.P. vs. Vijay Bahadur Singh 1982 (2) SCC 365;
RajasthanHousing Board vs. G.S. Investments and Anr. 2007        D
(1) SCC 477: 2006 (7) Suppl. SCR 868; Laxmikant vs.
Satyawan 1996 (4) SCC 208: 1996 (3) SCR 532; State of
Orissa v. Harinarayan Jaiswal 1972 (2) SCC 36: 1972 (3)
SCR 784 - relied on.
                                                                 E
     1.~. The relief sought by the plaintiff in the original
suit that non-acceptance of his bid was illegal and void,
is not maintainable in law as the plaintiff did not acquire
legal right in respect of the plot in question. It is an
undisputed fact that the final bid was not accepted by the
                                                                 F
third defendant. Further, even assuming that the
Assistant Housing Commissioner had the authority to
supervise and conduct the public auction and the
authority to accept the final bid of the plaintiff, he did not
accept the bid of the plaintiff in writing and
communicated the same to him. Therefore, there was no            G
concluded contract in favour of the plaintiff in relation to
the offer made by him, whose offer was highest in public
auction. [Paras 32 and 33] [225-D; 226-D-E]
    1.4. Section 16 of the Act confers power upon the            H
    202       SUPREME COURT REPORTS            (2013) 6 S.C.R.


A Board to dispose of its property as per Rule 3 of the U.P.
  Avas Avam Vikas Parishad (Delegation of Powers by the
  Board and the Housing Commissioner) Rules, 1968. The
  Board has power under Section 12(1) of the Act to
  delegate its power either to a Committee or the Housing
s Commissioner or any other officer in exercise of its power
  to discharge its functions. It was the case of the
  defendants that the Assistant Housing Commissioner
  was not delegated this power by the Board. In this
  regard, there was no pleading of the plaintiff except the
c averments made in the plaint. Further there is no
  communi'cation by the first defendant regarding
  acceptanee of the proposal of the highest bid of the
  plaintiff as required under Section 3 of the Contract Act,
  1872. Unaccepted offer of the plaintiff does not create any
  right or any obligation on the part of the defendant to
0
  execute the lease deed. [Paras 34 and 35] [227-B-D]
          Bhagwan Das Goverdhan Das Kedia vs. Girdhari Lal and
    Co. AIR 1966 SC 543: 1966 SCR 656- relied on.

E      Pharmaceutical Society of Great Britain vs. Boots Cash
    Chemists(Southem) Ltd. (1952) 2 QB 795 - referred to.

       1.5. The proposal is said to have been completed
  when the same is accepted by the competent authority,
  which has not been done in the instant case. Neither the
F Housing Commissioner nor the Assistant Housing
  Commissioner accepted the proposal in writing;
  therefore, there is no communication of acceptance of the
  offer of the plaintiff. The communication of acceptance of
  the highest bid is necessary for concluding the contract.
G Therefore, there is no concluded contract in favour of the
  plaintiff in respect of the plot in question and the plaintiff
  cannot claim any legal right and question of enforcement
  of the said right as provided under Section 34 of the
  Specific Relief Act seeking declaratory relief. [Para 36]
H [228-C-E]
U.P. AVAS EVAM VIKAS PARISHAD v. OM PRAKASH 203
                   SHARMA
    Haridwar Singh vs. Begum Sumbrui AIR 1972 SC 1942:            A
1972 (1) SCR 673 - relied on.

     1.6. The substantial questions framed by the court in
the second appeal did not arise for its consideration. The
High Court ought to have noticed that the legal right             8
claimed by the plaintiff seeking relief under Section 34 of
the Specific Relief Act on the basis of the pleadings, is
wholly untenable in law. In view of the fact that no legal
right accrued in favour of the plaintiff in the absence of a
concluded contract, no right was accrued upon the
bidder in relation to the property in question. Therefore,        C
the suit itself is not maintainable and the suit filed on the
basis of the alleged cause of action did not arise. Hence,
the trial court could not have granted any relief by not
framing the relevant and proper issue and answering. the
same. The conclusion arrived at by the first appellate            D
court in dismissing the suit is perfectly legal and valid.
The said judgment has been erroneously interfered with
by the High Court by framing substantial questions of
law. In fact and in law, the aforesaid substantial questions
do not arise for its consideration and answer the same            E
in favour of the plaintiff, which are erroneous in law.
[Para 37] (228-G; 229-A-E]

     2. To institute a suit against the first defendant-
appellant, the plaintiff-respondent was required to issue         F
notice under Section 88(2) of the Act which is mandatory
in law. No such notice was issued to the first defendant.
The plea taken by the plaintiff that the defendants have
waived their right in urging their plea that the suit is not
maintainable for non-issuance of notice under Section             G
88(2) to the first defendant for institution of suit, is wholly
untenable in law. The maintainability of the suit on the
ground of non issuance of a statutory notice to the first
defendant prior to institution of the suit is a legal ground,
which can be raised at any point of time, even in the
                                                                  H
    204      SUPREME COURT REPORTS            [2013) 6 S.C.R.


A second appeal; this is well established principle of law.
  This aspe~t of the matter has not been considered by the
  trial court while answering the relevant contentious
  issues. The second appellate court too did not consider
  this important legal aspect of the case. Therefore, the
B plaintiff has no right to institute a suit in absence of the
  notice unqer Section 88(2) of the Act, which is mandatory
  in law. [Para 31] [224-F-H; 225-A-C]

      Pradyat Kumar vs. Chief Justice of Calcutta AIR 1956 SC
C 285: 1955 SCR 1331; Sahni Silk Mills (P) Ltd. vs. ES! Corpn.
  1994 (5) $CC 346: 1994 (1) Suppl. SCR 626; Director
  General, ES! vs. T. Abdul Razak 1996 (4) SCC 708: 1996
  (3) Suppl, SCR 80; The Barium Chemicals Ltd. vs. The
  Company Law Board and Ors. AIR 1967 SC 295: 1966
  SCR 311; State of Orissa vs. Commissionr of Land Records
D and Settlement 1998 (7) SCC 162: 1998 (1) Suppl. SCR
  130; CESC vs. Subhash Chandra Bose 1992 (1) SCC 441:
  1991 (2) Suppl. SCR 267; Hassan Co-operative Milk
  Producers's Union Ltd. vs. ES/. 2010 (11) SCC 537: 2010 (5)
  SCR 232 - cited.
E
                         Case Law Reference:
          1955 SCR 1331               cited         Para 10
          1994 (1) Suppl. SCR 626     cited         Para 14
F         1996 (3) Suppl. SCR 80      cited         Para 14
          1966 SCR 311                cited         Para 14
          1998 (1) Suppl. SCR 130     cited         Para 15

G         1991 (2) Suppl. SCR 267     cited         Para 16
          2010 (5) SCR 232            cited         Para 16
          2009 (6) SCR 663            cited         Para 27
          1982 (2) sec 365            relied on     Para 28
H
U.P. AVAS EVAM VIKAS PARISHAD v. OM PRAKASH 205
                   SHARMA
     2006 (7) Suppl. SCR 868           relied on       Para 28        A
     1996 (3) SCR 532                  relied on       Para 28
     1972 (3) SCR 784                  relied on       Para 28
     (1952) 2 QB 795                   referred to     Para 34        B
     1966 SCR 656                      relied on       Para 35
     1972 (1) SCR 673                  relied on       Para 36

    CIVIL APPELLATE JURISDICTION : Civil Appeal No.
3908-3909 of 2013.                                                    c
     From the Judgment & Order dated 28.5.2010 in SA No.
113 of 2001, dated 18.4.2011 in CMRA No. 215947 of 2010
in SA No. 113 of 2001 of the High Court of Judicature at
Allahabad.                                                            D

    Rakesh Dwivedi, Vishwajit Singh, Abhindra Maheshwari,
Sansriti Pathak, Pankaj Singh for the Appellants.

    Ranjeet Kumar, Varun Goswami, Rajesh Singh, R.C.
Kaushik for the Respondents.                                          E

     The Judgment of the Court was delivered by

     V. GOPALA GOWDA, J. 1. Leave granted.

     2. These appeals are directed against the judgment and           F
orders dated 28.5.2010 and 18.4.2011 passed in Second
Appeal No.113 of 2001 and CMRS No.215947/2010 by the
High Court of Allahabad in allowing the second appeal by
answering the substantial questions of law framed in favour of
the respondent-plaintiff and rejecting the CMRS No.215947/            G
2010 in the aforesaid second appeal urging relevant facts and
legal contentions in support of the appellant-defendant's case.
The brief facts are stated for the purpose of appreciating the
factual and rival legal contentions urged on behalf of the parties,
in view to find out as to whether the impugned judgment and           H
    206      SUPREME COURT REPORTS                 (2013) 6 S.C.R.


A orders under challenge in these appeals are required to be set
  aside by this Court in exercise of its jurisdiction.

       3. The ranking of the parties is referred to in the judgment
  as has been assigned before the 1st Additional Civil Judge,
B Bar~illy fQr the sake of convenience.

        4. The first defendant {appellant herein) is a statutory body
  created under the Uttar Pradesh Avas Evam Vikas Parishad
  Adhiniyam, 1965 for development of colonies, residential plots,
  commercial plots and complexes in the State of Uttar Pradesh.
C The first defendant on 4.3.1977 pub!ished in the local
  newspapers for auction of nine shops and a plot earmarked
  for Cinema Hall measuring 3441.94 sq. meters in lzzat Nagar,
  Scheme No.1, Block C and D in Bareilly District specifying the
  date of auction and furnishing necessary information. According
D to the plaintiff, the reserved price of the Cinema plot was fixed
  at Rs.1 ;a0,200/- and the auction of the property was conducted
  on 11.3.11977 under the supervision of one Mr. Raj Kumar
  Singh Bisen, the then Assistant Housing Commissioner of the
  first defendant Board. In the auction, the plaintiff {respondent
E herein) ottered the highest bid of Rs.1,31,500/- and as per the
  terms anld conditions of the auction, he had deposited
  Rs.26,30~/- i.e. 20% of the bid amount, plus Rs.500/- as
  earnest rnoney.

F       5. In tesponse to the plaintiff's representations made to the
  first defenpant on 24.5.1977 and 1.6.1977 asking for issuance
  of the allCl>tment letter in his favour, the Assistant Housing
  Commissioner informed the plaintiff vide his letters dated
  26.5.1977 and 8. 7.1977 stating that the third defendant
  Housing Commissioner of the Board had rejected the bid
G amount deposited by the plaintiff and the same was refunded
  by way of demand draft..

       6. The plaintiff filed original suit bearing No.143 of 1977
  in the Civil Court, Bareilly challenging the action of the first
H defendant with regard to the allotment of plot and in the said
U.P. AVAS EVAM VIKAS PARISHAD v. OM PRAKASH 207
         SHARMA [V. GOPALA GOWDA, J.]
suit the first defendant filed written statement. The learned Civil   A
Judge, Bareilly after conducting the trial, answered the issues
framed by it, on proper appreciation of documentary and oral
evidence in favour of the plaintiff and passed its judgment and
order dated 17.12.1977 decreeing the suit as prayed by the
plaintiff.                                                            B

     7. Aggrieved by the aforesaid judgment and order passed
by the trial court, the first defendant filed First Appeal No.107
of 1978 before the High Court urging various legal contentions.
The High Court by its order dated 20th May, 1987 after
examining rival factual and legal contentions set aside the           C
judgment and order of the trial court and remanded the matter
to the trial court for its reconsideration. After the remand order
passed by the High Court, the first defendant filed its additional
written statement before the trial court. The trial court
considered the entire pleadings, evidence on record and               D
examined three more witnesses. Again it passed the decree
in favour of the plaintiff by order dated 24.9.1993. Against the
said judgment, the defendant filed first Appeal No.67 of 98
before the District Judge. The learned District Judge allowed
the appeal with costs by setting aside the impugned judgment          E
and decree of the trial court by its order dated 2.2.2000.

     8. On 10.2.2000, aggrieved by the impugned judgment
and decree passed by the first appellate court, the plaintiff filed
Second Appeal No.113 of 2001 before the High Court urging             F
various legal contentions. The High Court on 28.5.2010 allowed
the appeal by answering the substantial questions of law framed
by it in the Second Appeal and set aside the judgment dated
2.2.2000 of the first appellate court.

     9. While answering the substantial questions of law framed       G
by it, the High Court has held that the judgment of the first
appellate court was contrary to record as the same is passed
without proper application of mind. It is the case of the
defendants that the High Court while passing the impugned
judgment has completely ignored to consider the provisions of         H
    208         SUPREME COURT REPORTS              (2013] 6 S.C.R.


A   Section 12 of the U.P. Avas Evam Vikas Parishad Adhiniyam,
    1965 (hereinafter referred to as 'the Act'). Section 12 of the
    Act, reads as under:

          "12. Delegation of powers.-
B         (1) Subject to the provisions of this Act and the rules, the
          Board may by general or special order delegate, either
          unconditionally or subject to such conditions, including the
          condition of review by itself, as may be specified in the
          order, to any committee appointed by it or to the Housing
c         Commissioner or any officer of the Board such of its
          powers and duties under this Act, as it may deem
          nec1:issary.

          (2) Subject to the provisions of this Act and the rules, the
D         Housing Commissioner may by general or special order
          delegate, either unconditionally or subject to such
          conditions, including the condition of review by himself, as
          may be specified in the order, to any officer of the Board
          such of his powers and duties under this Act, not being
          powers and duties delegated to him under sub-section (1 ),
E
          as he may deem necessary."

         Seation 12 provides powers to the Board for delegation
    of its powers to the Housing Committee or to the Housing
    Commissioner or any officer of the Board.
F
       10. The defendants aggrieved by the said judgment filed
  a review application challenging the findings and reasons
  recorde¢l in the impugned judgment contending that there was
  an error apparent on the face of the record and therefore
G prayed for review of the said judgment and order, which was
  dismissed by the High Court after hearing the parties vide its
  order dellted 18.4.2011. Therefore, the defendants have filed
  these appeals urging the following legal questions and
  grounds:-

H          a.    Whether the High Court was correct in ignoring the
U.P. AVAS EVAM Vfl<AS PARISHAD v. OM PRAKASH 209
         SHARMA [V. GOPALA GOWDA, J.]
         fact that the Housing Commissioner had never             A
         made any delegation of power with regard to
         accepUreject the bid in favour of the Assistant
         Housing Commissioner, hence the question of
         producing any order of delegation by first defendant
         Parishad never arose and as it was the plaintiff who     B
         based his contention that the power to accept the
         highest bid was delegated by the Housing
         Commissioner to the Asstt.                  Housing
         Commissioner, therefore, he ought to have
         produced such delegation power in support of his         c
         claim?

    b.   Whether the High Court was correct in ignoring that
         as per the terms and conditions of the auction of
         the properties mentioned in the bookleUprinted
         format, the auction was subject to the approval of       D
         the Housing Commissioner and, therefore, the
         conclusion of the High Court in this regard is
         contrary to the facts and the same is sustainable
         in law?
                                                                  E
    c.   Whether the High Court was correct in ignoring that
         the then Assistant Housing Commissioner was
         deputed only to supervise and conduct the auction
         as a ministerial officer and had neither any authority
         to accept the bid nor did he accept the said bid at      F
         any stage?

    d.   Whether the High Court was correct in ignoring that
         the Housing Commissioner was the only
         Competent authority to accept or reject the bid and
         the bid of the plaintiff was rejected by him and         G
         consequently, there was no concluded contract of
         sale of the property in his favour as claimed by him
         and no allotment letter was ever issued to him?

    e.   Whether the High Court was correct in ignoring that      H
    210        SUPREME COURT REPORTS                [2013] 6 S.C.R.


A               as per the maxim "delegatum non protest
                delegare", the statutory power must be exercised
                only by the body and office to whom it has been
                conferred and none else can discharge the function
                entrusted to it by law?
8
          f.    Whether the Hon'ble High Court was correct in
                ignoring the judgment of this Hon'ble Court in the
                case of Pradyat Kumar vs. Chief Justice of
                Calcutta' wherein the Supreme Court observed that
                "it is well recognized that the statutory functionaries
c               exercising the power of delegation cannot be said
                to have delegated such functions merely by
                deputing responsible and competent officials to
                enquire and report. This is the ordinary mode of
                exercise of any administrative power"?
D
       11. l'l'lr. Rakesh Dwivedi, learned senior counsel on behalf
  of the defendants submitted that the High Court was not correct
  in ignoring the fact that the Housing Commissioner had never
  made any delegation of power in favour of the then Assistant
E Housing Commissioner of the Board, in regard to accept or
  reject the bid of the plaintiff, therefore, the question of producing
  the order of delegation of his power said to have been given
  by the fir$! defendant in his favour did not arise and it was the
  plaintiff who based his claim contending that power to accept
F the highest bid was delegated by the Housing Commissioner
  to the then Assistant Housing Commissioner though there is
  no such specific plea in the plaint presented by the him except
  pleading the averments at paragraph 5 that as per the terms
  and conditions of acceptance of bid it was final and binding
G on the fall of hammer and the same did not require the
  acceptance or rejection by defendants or any authority what so
  ever. Therefore, the High Court has committed serious error in
  law in framing the substantial question of law in this aspect and


H 1. AIR 1956SC285.
U.P. AVAS EVAM VIKAS PARISHAD v. OM PRAKASH 211
         SHARMA [V. GOPALA GOWDA, J.]
answered the same in favour of the plaintiff, by concurring with      A
the findings of the trial court in drawing an adverse inference
under Section 114 of the Evidence Act with regard to non-
production of the order of delegation purported to have passed
by the Housing Board in favour of the then Assistant Housing
Commissioner or the Housing Commissioner delegating his               B
power to the then Assistant Housing Commissioner. In the
absence of such pleading, and also in the absence of evidence
and contentions urged on behalf of the plaintiff, neither the trial
court nor the High Court should have accepted it and it could
not have framed the substantial question of law in this regard        C
and answered the same in favour of the plaintiff.

     12. It is further contended by the learned senior counsel
that the High Court was not right in ignoring the terms and
conditions of the public auction mentioned in the booklet/printed
format particularly Condition No.5 by which the auction of the        D
property in question was subject to the approval of the Housing
Commissioner. The High Court has recorded the finding of fact
while answering the substantial questions of law framed at (c)
in favour of the plaintiff by placing reliance upon Section 106
of the Indian Evidence Act. Therefore, the finding recorded by        E
the High Court is erroneous in law and the same is liable to be
set aside.

     13. Further, it is urged by the learned senior counsel that
the High Court has committed an error both on facts and in law
                                                                      F
and also that it has ignored the fact that the then Assistant
Housing Commissioner was deputed only to supervise and
conduct auction of the property as ministerial officer and he had
neither any authority to accept the bid nor he had accepted the
bid at any stage.
                                                                      G
     14. Another ground urged by the learned senior counsel
on behalf of the defendant is that the High Court has ignored
the fact that Housing Commissioner of the Board was the only
competent authority to accept or reject the bid of the plaintiff
and in fact he had rejected the offer and there was no                H
    212        f)UPREME COURT REPORTS               [2013] 6 S.C.R.


A   concluded contract of sale of the plot in favour of the plaintiff
    as claimed by him. No allotment letter was ever issued in his
    favour ancj in the absence of the same, the prayer of the plaintiff
    that the auction of the property was held in relation to the plot
    in question under Scheme No.1 at Bareilly in favour of the
B   plaintiff, is final and binding and non-acceptance of the same
    by the third defendant-Housing Commissioner who has
    rejected the bid of the plaintiff and communicated the same vide
    its letters dated 26.5.77 and 8.7.77 by the then Assistant
    Housing Oommissioner in relation to Cinema Hall was illegal
    and void and the same has no effect on the status of plaintiff
C   as owner/cillottee thereof is wholly untenable in law. Another
    contention urged by the learned senior counsel is that the third
    defendant-Housing Commissioner has no power to delegate
    his authority to another officer in exercise of authority under
    Section 12(2) of the Act. Section 12(2) provides for a statutory
D   bar upon him from further delegation of the functions and
    powers which have been delegated upon him by the Board. He
    has placed reliance on the decisions of this Court in Sahni Silk
    Mills (P) Ltd. vs. ES/ Corpn.2, Director General, ES/ vs. T.
    Abdul Razak 3 and The Barium Chemicals Ltd. vs. The
E   Company Law Board & Ors4 ..

         15. Furlther, the learned senior counsel placed reliance
    upon the j11Jdgment of this Court in State of Orissa vs.
    Commissioner of Land Records and Settlement5, in support
F   of the proposition of law that a principal does not lose his
    powers merely because those powers have been delegated to
    another body.

         Also, placing reliance upon the aforesaid proposition of
    law laid down by this Court in the decision referred to above, it
G
    2.   1994 (5) SOC 346 Para 6-8),
    3.   1996 (4) SOC 708 (para 14-15)
    4.   AIR 1967 SC: 295.
H   5.   1998 (7) sec 162 (para 34).
U.P. AVAS EVAM VIKAS PARISHAD v. OM PRAKASH 213
         SHARMA [V. GOPALA GOWDA, J.]
is urged by the learned senior counsel that nothing prevents the      A
third defendant from reviewing the order passed by the
delegatee, that is, the then Assistant Housing Commissioner
which becomes evident from bare reading of Section 12(2) of
the Act. Further, he has placed reliance upon Section 11 of the
Act which provides that Housing Commissioner shall exercise           B
supervision and control over all officers and servants of the
Board.

     16. The power of supervision and control has been
interpreted by this Court to include power of supervision,
management or authority to direct, restrict or regulate. Learned
                                                                      c
senior counsel placed reliance on the judgments of this Court
in support of the above legal submissions in CESC vs.
Subhash Chandra Bose 6 and Hassan Co-operative Milk
Producers's Union Ltd. vs. ESf.
                                                                      D
      17. Further, the learned senior counsel placed strong
reliance on the judgments of this Court in Meerut Development
Authority vs. Association of Management Studies", and State
of U.P. vs. Vijay Bahadur Singh 9, regardlng rights of the
bidder in participating in auction process and contended that         E
though the bidders can participate in the tender process, they
will not have any other right except the right to equality and fair
treatment in the matter of evaluation of competitive bids offered
by interested persons in response to notice inviting tenders in
a transparent manner and free from hidden agenda.                     F

     18. Further, the learned senior counsel placed reliance on
the law laid down by this Court in Rajasthan Housing Board
vs. G. S. Investments & Anr' 0 in support of his submissions that
bidder has no vested interest in relation to the auctioned
                                                                      G
6.   1992 (1) sec 441.
7.   2010 (11) sec 537.
8.   2009 (6) sec 111.
9.   1982 (2) sec 365.
10. 1996 (4) sec 208.                                                 H
    214       SUPREME COURT REPORTS                 (2013] 6 S.C.R.


A   property unless the bid is accepted, even though the auction
    is conclud$d in his favour and the auction proceedings can
    always be cancelled by the competent authority of the first
    defendant.

          19. Further the learned senior counsel placed reliance upon
8
    the judgment of this Court in Laxmikant vs. Satyawan" in
    support of his legal contention that this Court has repeatedly
    pointed out that 'State' or the authority which can be held to be
    'State' within the meaning of Article 12 of the Constitution is
    not bound to accept the highest tender or bid and the
C Government authority could validly retain its power either to
    accept or reject the highest bid in the interest of public revenue.
    In support of this legal contention, learned senior counsel placed
    reliance upon another decision of this Court in State of Orissa
    v. Harinarayan Jaiswa/1 2 and submitted that the High Court
D could have noticed that the trial court has proceeded under
    impression that the then Assistant Housing Commissioner had
    been authorized to supervise and conduct the auction in relation
    to the plot in question and that power automatically carried with
    him the authority to accept the highest bid to conclude the
E contract. In this regard the learned senior counsel referred to
    the decision of this Court in Pradyat Kumar vs. Chief Justice,
    Calcutta•. wherein this Court has observed that no delegation
    is iiwolved where the statutory authority requires another person
    exercising ministerial function to retain the decision and
F · responsibilfty of it in its hands.

       20. Further, learned senior counsel contended that the
  High Court while remanding the case in the earlier first appeal
  proceedings vide its judgment dated 20th May, 1987 to the trial
G court after i;etting aside the impugned judgment of the trial
  court, it had given specific directions to it for deciding the case
  afresh in the light of certain observations. The following


    11. 1996 (4) sec 2oa.
H 12. 1972 (2) sec 36 (para 13)
U.P. AVAS EVAM VIKAS PARISHAD v. OM PRAKASH 215
         SHARMA [V. GOPALA GOWDA, J.]
observations were made with reference to Section 11, which            A
reads as under:

           "The Housing Commissioner is thus an overall
     controlling authority over all officers and servants of the
     Board. In the provisions referred to earlier, the officers of
                                                                      B
     the Board including the authority and functions. The officers
     of the Board (which include the Assistant Commissioner)
     are required under the Act to discharge such functions as
     are delegated to them."

      21. The High Court has also directed the trial court to trace   C
out the source of power stated to have been delegated by the
Housing Commissioner to the then Assistant Housing
Commissioner under Section 12 since there must be an order
of delegation in favour of another and it is implied that
delegation must be in express terms and it cannot be by               D
implication. Further, the High Court also directed the trial court
to find out as to whether the Commissioner, the third defendant
authorized the then Assistant Housing Commissioner to
conduct an auction of the plot in question in writing or oral.
Whether in the face of the record, it could be said that it was a     E
case of seeking assistance only or a case of delegation in
favour of the then Assistant Housing Commissioner and that
finding recorded by the trial court on the basis of mis-reading
of statement of evidence of DW-1, the then Assistant Housing
Commissioner. Further, the case of the plaintiff was that the         F
auction officer carried with him the authority to conclude the
contract, whether such entrustment of authority was by an oral
order or in writing. There is no pleading in the plaint regarding
the same and therefore, the plaintiff should have been directed
to prove the same and the evidence of DW1 could not have              G
been accepted by the trial court to prove the negative fact that
no such order was made in writing in favour of the then
Assistant Housing Commissioner either by the Board or third
defendant as provided under Section 12(1) of the Act. Further,
the High Court has noted in its remand order the term of
                                                                      H
    216      SUPREME COURT REPORTS                (2013] 6 S.C.R.

A condition No.5 which enunciated that the power of final approval
  by an authority other than the auction officer and issuance of
  the allotment order in favour of the plaintiff was a condition
  precedent to the contract. The trial court has neither adverted
  to the afore!jlaid aspect of the case nor has referred to the
B conditions in its judgment. It is contended by the learned senior
  counsel while answering the contentious issue that the
  aforesaid observations made by the High Court in the earlier
  remand order by allowing the first appeal of the defendants
  which was binding on the trial court, the said directions have
C not been complied with. Therefore, the High Court could not
  have exercised its appellate jurisdiction and set aside the
  judgment of the first appellate court. Learned senior counsel
  further plac~d reliance upon the judgment of this Court in Sahni
  Silk Mills ~P) Ltd. 's case (supra) regarding the scope of
  Section 100 of CPC to exercise its jurisdiction. It could not have
0
  disturbed the findings of fact recorded by the first appellate
  court after tme judgment was passed by the trial court on remand
  and set asic!le the said findings holding that the grant of decree
  in favour of the plaintiff is erroneous in law, and therefore, the
  exercise of jurisdiction under Section 100 CPC by the High
E Court is contrary to the judgment of this Court in Sahni Silk
  Mills (P) Ltd. 's case (supra).

        22. Om the other hand, the learned senior counsel for the
  plaintiff, Mr. Ranjit Kumar sought to justify the impugned
F judgment contending that DW1, the then Assistant Housing
  Commissic1mer has admitted that he has got the authority to
  auction, therefore the finding of fact on the contentious issue
  is rightly recorded by the trial court, which was erroneously set
  aside by the first appellate Court. That finding of the first
G appellate court was found fault with by the High Court and
  therefore rightly framed the substantial questions of law and
  answered the same in favour of the plaintiff. The learned senior
  counsel also placed reliance upon the scheme of the first
  defendant which does not enumerate the condition for approval
H of the present bid of the plaintiff by the Housing Commissioner
U.P. AVAS EVAM VIKAS PARISHAD v. OM PRAKASH 217
         SHARMA [V. GOPALA GOWDA, J.]
in relation to the plot in question. In the absence of the same        A
the Housing Commissioner was ahead of authority in not
accepting the bid and it was only a formal allotment letter which
was required to be issued by him. The same has not been
issued, but on the other hand the third defendant-Housing
Commissioner has rejected the bid of the plaintiff which was           B
communicated vide its letters dated 26.5.77 and 8.7.77 by the
then Assistant Housing Commissioner and also 20% of the bid
amount with earnest money was refunded which is erroneous
in law.

      23. Further, the learned senior counsel submits that the trial   C
court has recorded the finding of fact in the impugned judgment
regarding non-production of the file by the first defendant in
relation to the delegation of power in favour of the then Assistant
Housing Commissioner for conducting auction and accepting
the bid in favour of the plaintiff and rightly adverse inference was   D
drawn against it under Section 114 of the Evidence Act by not
accepting the explanation given by the first defendant through
its officer that the file was misplaced in transit from Bareilly to
Lucknow stating that ii is untenable. The burden of proof is on
the first defendant by producing rElcord to show that the then         E
Assistant Housing Commissioner was only deputed to
supervise and conduct auction of the plot as ministerial officer
and did not have any authority to accept the bid. Further, it is
stated by the learned senior counsel that three other shops,
auction of which was held by the Assistant Housing                     F
Commissioner on 11.3.1977, were allotted in favour of the
highest bidders by accepting their offer and executing
necessary documents. It would clearly go to show that the
findings recorded by the trial court accepted by the High Court
in exercise of its second appellate jurisdiction and answering         G
the substantial questions of law in favour of the plaintiff in the
impugned judgment is based on the pleadings and the legal
evidence on record. Therefore, this Court need not interfere with
the concurrent findings of fact recorded by the High Court and
the findings recorded on the substantial questions of law in the       H
    218        SUPREME COURT REPORTS                (2013] 6 S.C.R.


A   impugned judgment particularly in view of the pleadings at
    paragraph 5 of the plaint which has been referred to in the
    earlier portion of the judgment while narrating the legal
    contentions wrged on behalf of the defendants. Therefore, he
    has prayed fbr dismissal of the appeals.
B
        24. With reference to the aforesaid rival factual and legal
    contentions urged on behalf of the parties, the following points
    would arise for consideration of this Court:

          a.    What are the rights of the plaintiff/bidder
c               participating in the auction process in relation to the
                plot in question?

          b.    Whether there ;s any vested right upon the plaintiff/
                lpidder until the bid is accepted by the competent
D               authority in relation to the property in question?
                Merely because the plaintiff is the highest bidder by
                depositing 20% of the bid amount without there
                being approval of the same by the competent
                authority and it amounts to a concluded contract in
                relation to the plot in question?
E
          c.    Whether the plaintiff could have maintained the suit
                in the absence of a concluded contract?

          d.    Whether the plaintiff proves that the Assistant
F               Housing Commissioner had the authority to accept
                the bid in relation to the plot in question which was
                put to auction and was empowered to allot the plot
                in favour of the plaintiff being the highest bidder?

          e.    Whether the trial court is right in holding that non-
G               issuance of notice to the first defendant as provided
                under Section 88(2) of the Act for institution of the
                suit and not taking the plea in this regard by the
                defendant in the initial stage rather taking the plea
                subsequently amounts to a waiver of the defence
H               of the defendants?
U.P. AVAS EVAM VIKAS PARISHAD v. OM PRAKASH 219
         SHARMA [V. GOPALA GOWDA, J.]
      f.     Whether the suit for declaratory relief on the basis        A
             of the cause of action as pleaded by the plaintiff,
             in the absence of allotment letter issued by the
             competent authority in relation to the plot in question
             as provided under Section 12(1) of the Act, is
             maintainable?                                               B

      g.     Whether the substantial questions of law framed by
             the High Court in the second appeal would arise for
             its consideration and whether the findings in the
             second appeal are erroneous in law?
                                                                         c
    25. The points (a) to (d) are required to be answered
against the plaintiff by assigning the following reasons:-

      !! is an undisputed fact that public auction was held in
relation to the property of the first defendant vide public notice       0
dated 4.3.1977 published in the local newspapers by the
Parishad for auction of nine shops and the plot earmarked for
cinema hall measuring 3441 sq. meters. The auction was
supervised and conducted on 11.3.1977 by one Mr. Ram
Kumar Singh Bisen the then Assistant Housing Commissioner.               E
It was also an admitted fact that the plaintiff was the highest
bidder as he had quoted Rs.1,31,500/- in relation to the plot
and he has deposited a sum of Rs.26,500/- that is 20% of the
amount of bid plus Rs.500/- as earnest money.

     26. It is also an undisputed fact that the offer of the plaintiff   F
is highest as per the terms and conditions of the sale of plot in
question by public auction are concerned, 20% of the bid
amount deposited by him that by itself does not amount to
accepting his bid by the competent authority for grant of lease
hold rights of plot in his favour.                                       G

      27. This Court in the case of Meerut Development
Authority case (supra) has laid down the legal principle that the
bidder who has participated in tender process have no other
right except the right to equality and fair treatment in the matter      H
    220       SUPREME COURT REPORTS                 [2013] 6 S.C.R.


A   of evaluation of competitive bids offered by interested persons
    in response to the notice inviting tenders in a transparent
    manner and free from hidden agenda. The relevant paragraphs
    are extracted hereunder:

                "217. The bidders participating in the tender process
B
          have n<i other right except the right to equality and fair
          treatmant in the matter of evaluation of competitive bids
          offered by interested persons in response to notice inviting
          tenders in a transparent manner and free from hidden
          agenda. One cannot challenge the terms and conditions
c         of the tender except on the abovestated ground, the
          reason being the terms of the invitation to tender are in the
          realm of the contract. No bidder is entitled as a matter of
          right to insist the aL1thority inviting tenders to enter into
          further negotiations unless the terms and conditions of
D         notice so provided for such negotiations.



                 29. The Authority has the right not to accept the
          highest bid and even to prefer a tender other than the
E
          highest bidder, if there exist good and sufficient reasons,
          such as, the highest bid not representing the market price
          but there cannot be any doubt that the Authority's action
          in accepting or refusing the bid must be free from
          arbittariness or favouritism."
F
       28. In support of the said proposition, learned senior
  counsel for the defendant, Mr. Rakesh Dwivedi has also placed
  reliance upon another decision of this Court in State of U.P vs.
  Vijay Bahadur Singh (supra). The learned senior counsel has
G rightly ~laced reliance upon the judgment of this Court in
  Rajasthan Housing Board case (supra) which reads as under:

                "9. This being the settled legal position, the
          respondent acquired no right to claim that the auction be
          concluded in its favour and the High Court clearly erred in
H
U.P. AVAS EVAM VIKAS PARISHAD v. OM PRAKASH 221
         SHARMA [V. GOPALA GOWDA, J.]

     entertaining the writ petition and in not only issuing a            A
     direction for consideration of the representation but also
     issuing a further direction to the appellant to issue a
     demand note of the balance amount. The direction relating
     to issuance of the demand note for balance amount
     virtually amounted to confirmation of the auction in favour         B
     of the respondent which was not the function of the High
     Court."

     The law laid down by this Court in the aforesaid paragraph
in support of the proposition of law that so long as an order            C
regarding final acceptance of the bid had not been passed by
the Chairman of the Housing Board, the highest bidder acquire
no vested right to have the auction concluded in his favour and
the auction proceedings could always be cancelled. Further, he
has placed reliance on another decision of this Court in the
case of Laxmikant referred to supra . In support of the                  D
proposition of law this Court has rightly pointed out that the
'State' or the Authority, which can be held to be a 'State' within
the meaning of Article 12 of the Constitution, is not bound to
accept the highest tender/offer or bid and the Government could
validly retain its power to accept or reject the highest bid in the      E
interest of public revenue. In support of this contention, he has
placed reliance on the State of Orissa vs. Harinarayan Jaiswal
case (supra), relevant paragraph of which reads as under:

           "13. Even apart from the power conferred on the               F
     Government under Sections 22 and 29, we fail to see how
     the power retained by the Government under clause (6) of
     its order, dated January 6, 1971, can be considered as
     unconstitutional. As held by this Court in Coove!jee B.
     Bharucha case, one of the important purpose of selling the          G
     exclusive right to sell liquor in wholesale or retail is to raise
     revenue. Excise revenue forms an important part of every
     State's revenue. The Government is the guardian of the
     finances of the State. II is expected to protect the financial
     interest of the State. Hence quite naturally, the Legislature
                                                                         H
    222        Sl,JPREME COURT REPORTS              [2013] 6 S.C.R.


A         has empowered the Government to see that there is no
          leakage in its revenue. It is for the Government to decide
          whether the price offered in an auction sale is adequate.
          While accepting or rejecting a bid. it is merely performing
          an executive function. The correctness of its conclusion is
B         not open to judicial review. We fail to see how the plea of
          contravention of Article 19(1)(g) or Article 14 can arise in
          these cases. The Government's power to sell the exclusive
          privileges set out in Section 22 was not denied. It was also
          not dii;puted that those privileges could be sold by public
c         auction. Public auctions are held to get the best possible
          price.

                 Once these aspects are recognised, there appears
          to be no basis for contending that the owner of the
          privileges in question who had offered to sell them cannot
D         decline to accept the highest bid if he thinks that the price
          offered is inadequate. There is no concluded contract till
          the bid is accepted. Before there was a concluded
          contract, it was open to the bidders to withdraw their bids
          - see Union of India v. Bhimsen Walaiti Ram 13 ~.
E         merely giving bids, the bidders had not acquired any
          vested rights. The fact that the Government was the seller
          does not change the legal position once its exclusive right
          to deal with those privileges is conceded. If the
          Government is the exclusive owner of those privileges.
F         reliance on Article 19(1)(g) or Article 14 becomes
          irrelevant. Citizens cannot have any fundamental right to
          trade or carry on business in the properties or rights
          belonging to the Government-nor can there be any
          infringement of Article 14, if the Government tries to get
G         the best available price for its valuable rights. The High
          Court was wholly wrong in thinking that purpose of
          Sections 22 and 29 of the Act was not to raise revenue.
          Raising revenue as held by this Court in Cooverjee B.
          Bharucha vs. The Excise Commissioner and the Chief
H 13. 1969 (3) sec 146.
U.P. AVAS EVAM VIKAS PARISHAD v. OM PRAKASH 223
         SHARMA (V. GOPALA GOWDA, J.]
    Commissioner, Ajmer & Ors' case was one of the                  A
    important purposes of such provisions. The fact that the
    price fetched by the sale of country liquor is an excise
    revenue does not change the nature of the right. The sale
    in question is but a mode of raising revenue. Assuming
    that the question of arbitrary or unguided power can arise      B
    in a case of this nature, it should not be forgotten that the
    power to accept or reject the highest bid is given to the
    highest authority in the State i.e. the Government which is
    expected to safeguard the finances of the State. Such a
    power cannot be considered as an arbitrary power. If that       c
    power is exercised for any collateral purposes, the
    exercise of the power will be struck down. It may also be
    remembered that herein we are not dealing with a
    delegated power but with a power conferred by the
    Legislature.                                     •
                                                                    D
           The High Court erroneously thought that the
    Government was bound to satisfy the Court that there was
    collusion between the bidders. The High Court was not
    sitting on appeal against the order made by the
    Government. The inference of the Government that there          E
    was a collusion among the bidders may be right or wrong.
    But that was not open to judicial review so long as it is not
    proved that it was a make-believe one. The real opinion
    formed by the Government was that the price fetched was
    not adequate. That conclusion is taken on the basis of          F
    Government expectations. The conclusion reached by the
    Government does not affect any one's rights. Hence, in our
    opinion, the High Court misapplied the ratio of the decision
    of this Court in Barium Chemicals Ltd. & Anr. v. Company
    Law Board and Rohtas Industries Ltd. v. S. T. Agarwal."         G

                                          (emphasis supplied)

    29. In view of the law laid down by this Court in the
aforesaid· decisions, learned senior counsel Mr. Rakesh
Dwivedi has rightly placed reliance upon the same in support        H
    224       SUPREME COURT REPORTS                   [2013] 6 S.C.R.


A of the case of the first defendant, which would clearly go to show
  that the plaintiff had not acquired any right and no vested right
  has been accrued in his favour in respect of the plot in question
  merely because his bid amount is highest and he had
  deposited 20% of the highest bid amount along with earnest
B money with the Board. In the absence of acceptance of bid
  offered by the plaintiff to the competent authority of the first
  defendant, there is no concluded contract in respect of the plot
  in question, which is evident from letters dated 26.5.1977 and
  8.7.1977 wherein the third defendant had rejected the bid
c amount deposited by the plaintiff and the same was refunded
  to him by way of demand draft, which is an undisputed fact and
  it is also not his case that the then Assistant Housing
  Commissioner who has conducted the public auction had
  accepted the bid of the plaintiff.

D        30. Th&refore, points (a) to (d) are answered in favour of
    the defehdants. In fact, these aspects have not been dealt with
    either by the trial court or by the second appellate court in the
    impugned judgments.

E Answer to Point No. Ce)

        31. To institute a suit against the first defendant, the plaintiff
  was required to issue notice under Section 88(2) of the Act
  which is mandatory in law. Undisputedly, no such notice was
  issued to the first defendant. The plea taken by the plaintiff that
F the defendants have waived their right in urging their plea that
  the suit is not maintainable for non-issuance of notice under
  Section 88(2) to the first defendant for institution of suit by the
  plaintiff is wholly untenable in law and the finding recorded by
  the trial court while answering the issue Nos. 5 and 6 in the
G impugned judgment of the trial court dated 24.9.1993 that
  defendants did not take this plea in its original written
  submissions is also wholly untenable in law. Also the plea that
  after the remand order the said plea was taken belatedly by
  the first defendant, therefore, it has waived its right, is erroneous
H finding recorded by the trial court. The said finding of the trial
U.P. AVAS EVAM VIKAS PARISHAD v. OM PRAKASH 225
         SHARMA [V. GOPALA GOWDA, J.]
court, which has been accepted by the second appellate court,         A
also suffers from error in law. The maintainability of the suit on
the ground of non issuance of a statutory notice to the first
defendant prior to institution of the suit is a legal ground, which
can be raised at any point of time, even in the second appeal;
this is well established principle of law. This aspect of the         B
matter has not been considered by the trial court while
answering the relevant contentious issue Nos. 5 and 6. The
second appellate court too did not consider this important legal
aspect of the case. Therefore, we have to answer the said point
against the plaintiff holding that the plaintiff has no right to      c
institute a suit in absence of the notice under Section 88(2) of
the Act, which is mandatory in law.

Answer to Point ID:
     32. The declaratory relief sought by the plaintiff in the        D
original suit is not maintainable in law as the plaintiff did not
acquire legal right in respect of the plot in question.

     The prayer at para 12 (a) of the plaint is extracted below
for consideration of this Court:                                      E
    "12 (a). That the auction held on 11.3.1977 in respect of
    the Cinema Plot in lzzatnagar (Scheme No.2) Bareilly in
    favour of the plaintiff is final and binding on the defendants ~
    and the non-acceptance thereof by the Housing
    Commissioner (defendant No.3) as communicated to the F
    plaintiff by the defendant no.1 by letter No.8851/S.P. 3/6
    Bareilly/Cinema plot dated 26.5.1977 is illegal and void
    and has no effect on the status of the plaintiff as owner/
    allottee thereof."
                                                                    G
    33. In this regard, ii is also necessary to extract Section
34 of the Specific Relief Act, 1963 for the purpose of
appreciating the tenability of the above prayer of the plaintiff,
which reads as under:
                                                                      H
    226        SUPREME COURT REPORTS                  (2013] 6 S.C.R.


A         "34. Oiscretion of court as to declaration of status or right.-
          Any person entitled to any legal character, or to any right
          as ta any property, may institute a suit against any person
          denying, or interested to deny, his title to such character
          or right, and the court may in its discretion make therein a
B         declaration that he is so entitled, and the plaintiff need not
          in such suit ask for any further relief:

          Provided that no court shall make any such declaration
          where the plaintiff, being able to seek further relief than a
          mere declaration of title, omits to do so. Explanation.- A
c         trustee of property is a" person interested to deny" a title
          adverse to the title of some one who is not in existence,
          and for whom, if in existence, he would be a trustee."

        It is an undisputed fact that the final bid has not been
D accepted by the third defendant. This is borne out from the
  letters dated 26.5.1977 and 8.7.1977. Further, even assuming
  that the Assistant Housing Commissioner had the authority to
  supervise and conduct the public auction and the authority to
  accept the final bid of the plaintiff in relation to the plot which
E was auctioned on 11.3.1977, it is also an undisputed fact that
  he did not accept the bid of the plaintiff in writing and
  communicated the same to him. Therefore, there is no
  concluded contract in favour of the plaintiff in relation to the offer
  made by him, whose offer is highest in public auction held on
F 11.3.1977. Hence, the suit filed by the plaintiff seeking for
  decliuatory relief as prayed in the plaint is wholly misconceived
  and is not maintainable in law. Thus, the judgment and order
  passed by the second appellate court is wholly unsustainable
  in law and is liable to be set aside.
G     34. It is an undisputed fact that Section 16 of the Act
  confers power upon the Board to dispose of its property as per
  Rule 3 of the U.P. Avas Avam Vikas Parishad (Delegation of
  Powers by the Board and the Housing Commissioner) Rules,
  1968. The Board has power under Section 12(1) of the Act to
H delegate its power either to a Committee or the Housing
U.P. AVAS EVAM VIKAS PARISHAD v. OM PRAKASH 227
         SHARMA [V. GOPALA GOWDA, J.]
Commissioner or any other officer in exercise of its power to         A
discharge its functions. It is the case of the defendants that the
Assistant Housing Commissioner was not delegated this power
by the Board. In this regard, there is no pleading of the plaintiff
except the averments made at para 5 of the plaint, the relevant
para is noted in the submissions made by the learned senior           B
counsel on behalf of the defendants. Further there is no
communication by the first defendant regarding acceptance of
the proposal of the highest bid of the plaintiff as required under
Section 3 of the Contract Act, 1872. This principle of law is well
settled as per the decision of the Queen's Bench in                   c
Pharmaceutical Society of Great Britain v. Boots Cash
Chemists (Southern) Ltd. 14
     35. Further, unaccepted offer of the plaintiff does not create
any right or any obligation on the part of the defendant to
execute the lease deed. In fact, this principle is well settled by    D
this Court in the case of Bhagwan Das Goverdhan Das Kedia
v. Girdhari Lal & Co. 15 wherein this Court has held that mere
making of an offer does not form part of the cause of action
for claiming damages for breach of contract. In the case in
hand, the aforesaid principle, without recourse, is applicable        E
in the fact situation for the reason that the plaintiff was the
highest bidder and his offer was merely accepted but no
communication was sent to him as required under Section 3
of the Contract Act. Therefore, no legal right accrued in favour
of the plaintiff to invoke remedy available under Section 34 of
                                                                      F
the Specific Relief Act, seeking declaratory relief as prayed in
the original suit filed by the plaintiff.
      36. Further, the communication under Section 4 of the
Contract Act speaks of when the communication will complete.
It says:                                                              G
     "4. Communication when complete. - The
     communication of a proposal is complete when it comes

14. (1952) 2 QB 765.
15. AIR 1966 SC 543.                                                  H
    228       SUPREME COURT REPORTS                  [2013] 6 S.C.R.


A         to the knowledge of the person to whom it is made.
          The communication of an acceptance is complete,-
                 ;;is against the proposer, when it is put in a course
                 <!>f transmission to him so as to be out of the power
B                of the acceptor;
                 as against the acceptor, when it comes to the
                 knowledge of the proposer."
    The proposal is said to have been completed when the same
    is accepted by the competent authority, which has not been
C   done in the instant case. Neither the Housing Commissioner
    nor the A!isistant Housing Commissioner accepted the
    proposal in writing; therefore, there is no communication of
    acceptance of the offer of the plaintiff. In this regard, this court
    in Haridwar Singh v. Begum Sumbrui' 6 has held that the
D   communication of acceptance of the highest bid is necessary
    for concluding the contract. In view of the aforesaid factual and
    legal proposition of law and the highest bid offered to take the
    property on lease for a period of 90 years with renewal for
    further 20 years for construction of the cinema hall, the same
E   was neither accepted by the competent authority nor was the
    same communicated. Therefore, there is no concluded contract
    in favour of the plaintiff in respect of the plot in question and
    the plaintiff cannot claim any legal right and question of
    enforcement of the said right as provided under Section 34 of
F   the Specific Relief Act seeking declaratory relief by the plaintiff
    the same did not arise in the case in hand. The above important
    factual and legal aspects have not been examined in proper
    and constructive manner either by the trial court or by the second
    appellate court. Therefore, the impugned judgment, order and
G   decree are liable to be set aside.
    Answer tj;) point !g)
          37. The substantial questions framed by the court in the

H   16. AIR 1972 SC 1942.
U.P. AVAS EVAM VIKAS PARISHAD v. OM PRAKASH 229
         SHARMA [V. GOPALA GOWDA, J.]

second appeal did not arise for its consideration. The High           A
Court ought to have noticed that the legal right claimed by the
plaintiff seeking relief under Section 34 of the Specific Relief
Act on the basis of the pleadings is wholly untenable in law. In
view of the fact that no legal right accrued in his favour in the
absence of a concluded contract which was said to have                B
existed by mere offering of highest bid in relation to the property
in question to obtain the property on lease for a period of 90
years amounting to disposal of the property of the first
defendant being an authority under Article 12 of the Constitution,
no right was accrued upon the bidder in relation to the property      c
in question. Therefore, the suit itself is not maintainable and the
suit filed on the basis of the alleged cause of action did not
arise. Hence, the trial court could not have granted any relief
by not framing the relevant and proper issue and answering the
same. This aspect of the matter is not considered by the trial        0
court. Therefore, the impugned judgment is set aside by the first
appellate court by recording reasons. It also did not address
and examine the points that arose for consideration as framed
by this Court in this judgment. However, the conclusion arrived
at by the first appellate court in setting aside the impugned
                                                                      E
judgment and dismissing the suit is perfectly legal and valid.
The said judgment has been erroneously interfered with by the
High Court by framing substantial questions of law. In fact and
in law, the aforesaid substantial questions do not arise for its
consideration and answer the same in favour of the plaintiff,
which are erroneous in law.                                           F

      38. We are of the view that the findings recorded by the
trial court and the second appellate court are totally erroneous
both on facts and in law and therefore required to be interfered
with by this Court and hence the appeals must succeed. The
impugned judgment, decree and orders of the High Court are            G
hereby set aside and the original suit No.143 of 1977 filed by
the plaintiff is also dismissed. The appeals are allowed, with
no order as to costs.
K.K.T.                                         Appeals allowed.       H