Allowed

Sri N a Prabhakar v. the Karnataka Housing Board

Karnataka HC27 Mar 2024WP/29623/2017

Case brief

AI extract

What is this about?

Licensees and heirs of licensees running businesses for decades in Karnataka Housing Board shops challenged an auction notification issued without granting them right of first refusal. The court quashed the notification qua their shops and directed the Board to first offer sale to them before any fresh auction.

What did the court decide?

Auction notification quashed qua petitioners' shops; Board directed to offer sale to petitioners first, then auction if declined; petitioners remain in possession subject to clearing arrears.

Sri N a Prabhakar Vs the Karnataka Housing… — Public Procurement and Tenders | Karnataka HC (2024)

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NC: 2024:KHC:12607 WP No. 29623 of 2017 C/W WP No. 34835 of 2017 WP No. 36895 of 2017

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 27^TH DAY OF MARCH, 2024

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BEFORE

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THE HON'BLE MR JUSTICE M.NAGAPRASANNA WRIT PETITION NO. 29623 OF 2017 (GM-RES)

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C/W

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WRIT PETITION NO. 34835 OF 2017 (GM-RES), WRIT PETITION NO. 36895 OF 2017 (GM-RES)

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IN W.P.No.29623/2017

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BETWEEN:

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SRI. N. A. PRABHAKAR, S/O LATE N.C.APPASWAMY, AGED ABOUT 66 YEARS, RESIDING AT DOOR NO.5413, M.G.S. ROAD EXTENSION, NANJANGUD TOWN - 571 301.

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…PETITIONER

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(BY SRI. MANJUNATHA H M., ADVOCATE)

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Digitally signed by NAGAVENI Location: HIGH COURT OF KARNATAKA

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AND:

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THE KARNATAKA HOUSING BOARD, 4^TH FLOOR, CAUVERY BHAVAN, K.G. ROAD, BENGALURU - 560 009,

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REPRESENTED BY THE COMMISSIONER.

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THE ASSISTANT EXECUTIVE ENGINEER, KARNATAKA HOUSING BOARD, SARASWATHIPURAM MYSURU – 570 009.

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…RESPONDENTS

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(BY SRI.RAVINDRA H.T., ADVOCATE FOR R1 AND R2)

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2 - NC: 2024:KHC:12607 WP No. 29623 of 2017 C/W WP No. 34835 of 2017 WP No. 36895 of 2017

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THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ENTIRE ACTION/PROCEEDING PURSUANT TO THE PUBLIC NOTIFICATION DATED 10.5.2017 PUBLISHED IN NEWSPAPER ON 13.5.2017 [ANNEXURE-F] IN SO FAR AS PETITIONER IS CONCERN AND ETC.,

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IN W.P.No.34835/2017

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BETWEEN:

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SMT.SUSHILA, W/O LATE BABU, AGED ABOUT 40 YEARS, RESIDING AT NO.728, NARASANNA AGRAHARA, NANJANGUD TOWN – 571 301.

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…PETITIONER

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(BY SRI. MANJUNATH H M., ADVOCATE)

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AND:

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THE KARNATAKA HOUSING BOARD, 4^TH FLOOR, CAUVERY BHAVAN, K.G. ROAD, BENGALURU - 560 009,

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REPRESENTED BY THE COMMISSIONER.

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THE ASSISTANT EXECUTIVE ENGINEER, KARNATAKA HOUSING BOARD, SARASWATHIPURAM MYSURU – 570 009.

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…RESPONDENTS

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(BY SRI.RAVINDRA H.T., ADVOCATE FOR R1 AND R2)

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THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE

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3 - NC: 2024:KHC:12607 WP No. 29623 of 2017 C/W WP No. 34835 of 2017 WP No. 36895 of 2017

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ENTIRE ACTION/PROCEEDING PURSUANT TO THE PUBLIC NOTIFICATION DATED 10.5.2017 PUBLISHED IN NEWSPAPER ON 13.5.2017 VIDE ANNEXURE-J IN SO FAR AS PETITIONER IS CONCERN AND ETC.,

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IN W.P.No.36895/2017

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BETWEEN:

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SRI.H.M.MANJUNATHA, S/O LATE M.MALLESHAIAH, AGED ABOUT 60 YEARS, RESIDING AT DOOR NO.3428, 14^TH CROSS, M.G.ROAD, NANJANGUD TOWN – 571 301.

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…PETITIONER

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(BY SRI.DODDAIAH D.S., ADVOCATE)

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AND:

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THE KARNATAKA HOUSING BOARD, 4^TH FLOOR, CAUVERY BHAVAN, K.G. ROAD, BENGALURU - 560 009,

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REPRESENTED BY ITS COMMISSIONER.

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THE ASSISTANT EXECUTIVE ENGINEER, KARNATAKA HOUSING BOARD, SARASWATHIPURAM MYSURU – 570 009.

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…RESPONDENTS

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(BY SRI.RAVINDRA H.T., ADVOCATE FOR R1 AND R2)

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THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE

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4 - NC: 2024:KHC:12607 WP No. 29623 of 2017 C/W WP No. 34835 of 2017 WP No. 36895 of 2017

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ENTIRE ACTION/PROCEEDING PURSUANT TO THE PUBLIC AUCTION DATED 10.5.2017 PUBLISHED IN LOCAL NEWS PAPER ANDHOLANA ON 13.5.2017 VIDE ANNEXURE-N IN SO FAR AS PETITIONER IS CONCERN AND ETC.

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THESE PETITIONS, COMING ON FOR PRELIMINARY HEARING IN 'B' GROUP, THIS DAY, THE COURT MADE THE FOLLOWING:

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ORDER

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These petitions are preferred against a common action of the respondent - the Karnataka Housing Board (hereinafter referred to as 'the Board' for short) issuing a notification dated 10.05.2017 calling for auction of the properties in which the petitioners are running their business either as licensees or sub-licensees from the hands of the original licensees.

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Heard Sri. Manjunatha H.M., learned counsel appearing for the petitioners in W.P.Nos.29623/2017 and 34835/2017, Sri. Doddaiah D.S., learned counsel appearing for the petitioner in W.P.No.36895/2017 and Sri. Ravindra H.T., learned counsel appearing for respondent Nos.1 and 2 in all these cases.

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5 - NC: 2024:KHC:12607 WP No. 29623 of 2017 C/W WP No. 34835 of 2017 WP No. 36895 of 2017

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Sans details, the facts in brief germane, are as

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follows:

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The issue revolves around six commercial shops constructed by the Board in Nanjangud Town, Mysore District. The construction is close to 50 years. On 01.02.1979, the Board allots commercial shops No.2, 4 and 6 in favour of these petitioners, on certain particular monthly rent initially for a period of 12 years. It transpires that the licensees who were allotted the shops died and the children of those licensees continued to be in possession and run the business of their father. The petitioners are now in possession of those commercial shops build by the Board for over 38 years to the minimum in all these cases. When things stood thus, a notification comes to be issued on 22.05.2017 by the Board seeking to grant licenses by way of public auction to those shops, which were in possession of the petitioners. It is this notification, that drives the petitioners to this Court, in the subject petition.

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4. This Court, protected the interest of the petitioners

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by directing the parties to maintain staus quo in terms of the

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NC: 2024:KHC:12607 WP No. 29623 of 2017 C/W WP No. 34835 of 2017 WP No. 36895 of 2017

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order dated 18.07.2017, which is in subsistence even as on date. Therefore, the auction has not fructified itself into any auction purchaser getting into the possession of the property.

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The learned counsel appearing for the petitioners taking this Court to the documents appended to the petition would seek to demonstrate that the auction did not take place on the intended date with or without the strength of the interim order, as no bidder came forward to take the property on lease. It is his submission that if anybody had become successful in the auction, they intervened in the subject petitions by filing necessary application. Since nobody has filed any application for the last seven years, the presumption is that there was no bidder. It is his further submission that in the light of the status quo order, the petitioners have continued in their business and should not be disturbed, as they have the right of first refusal when a public auction is made of the shops that they are in possession of for decades.

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Learned counsel appearing for respondent Nos.1 and 2 would submit that the petitioners have no right to continue in the premises, as have not even participated in the

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NC: 2024:KHC:12607 WP No. 29623 of 2017 C/W WP No. 34835 of 2017 WP No. 36895 of 2017

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auction. If they are non participants, they cannot question the auction. He would submit that the public property is to be leased out by way of public auction is now the settled principles of law. He would seek dismissal of these petitions and permit the Court to go on with the auction for the properties.

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I have given my anxious consideration to the respective submissions made by the learned counsel and have perused the materials on record.

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The afore-narrated facts are not in dispute. The petitioners in all these cases are either licensees or sub-licensees or the children of those licensees qua shop Nos.2, 4 and 6 in Nanjangud Town, Mysore District. These shops were constructed in the year 1976 and in the year 1979, the respective father of the petitioners or the petitioners themselves granted licensees to run their business in the shops. From 1979 to 2017, close to 38 years, the petitioners have been in possession of the shops on intermittent renewal of licensees. Before issuance of the auction notification, since the petitioners were in possession of the shops for close to 40 years, the right of first refusal ought to have been granted

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8 - NC: 2024:KHC:12607 WP No. 29623 of 2017 C/W WP No. 34835 of 2017 WP No. 36895 of 2017

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to these petitioners for further action qua the property that was sought to be put to auction. The impugned unilateral notification would leave the petitioners to the streets, as they have not participated in the auction nor were given the right of first refusal prior to issuance of the notification. They are eaking out their livelihood by running the business in these shops and over night cannot be thrown away except, in accordance with law. In these peculiar facts, I deem it appropriate to obliterate the impugned action of issuance of the auction notification and direct the Board to offer the purchase of these petitioners, if they are willing to purchase the properties at the prices that they would negotiate with the Board and then if the petitioners fail in their will, take action in accordance with law and then put the property for sale or lease, as the case would be, as is done by the impugned notification. Till such time, the Board would comply with the observations made in the course of the order, the petitioners shall not be disturbed, as they have the benefit of the interim order right from 18.07.2017.

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NC: 2024:KHC:12607 WP No. 29623 of 2017 C/W WP No. 34835 of 2017 WP No. 36895 of 2017

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For the aforesaid reasons, the following:

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ORDER

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i. Writ Petitions are allowed.

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ii. The public notification dated 13.05.2017 stands quashed qua the shops of the petitioners.

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iii. The matters is remitted back to the hands of the Board to offer the sale of the property at the outset to the petitioners and if the petitioners are not willing, then put the property to public auction.

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iv. The petitioners shall continue in the premises that they are holding, subject to the condition that they would clear the arrears of the rent to its last pie. The rent that was paid 40 years cannot be the rent that would be paid by these petitioners. It is for the Board to fix appropriate rent and demand such payment.

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Sd/JUDGE

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SJK

Sri N a Prabhakar v. the Karnataka Housing Board

Case brief

What is this about?

What did the court decide?

Sri N a Prabhakar v. the Karnataka Housing Board

Case brief

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