High Court orders demolition of structure on the site

Mysore, July 9 (MRS)- The Karnataka High Court has quashed the auction of a Karnataka Housing Board (KHB) site in Kuvempunagar on the ground that it fetched lesser price than the market rate and ordered demolition of structure put up by the bidder who had won the bid in 2001.

The Court in its verdict on June 14, 2010 has also directed the bidder to redeliver the site within 15 days to the KHB, which has been asked to return the bid amount.

G.H. Mohan Kumar, a resident of 7th Cross, Kuvempunagar, who earlier bid for the same for Rs. 17,25,000 which was rejected by the KHB on the ground that it was less than the market rate, had filed a writ petition (WP No. 21770 / 2002) in the High Court challenging the sale of the corner site No. 1 (18x24 meters) in J.T. Koppal, III Phase, to K.N. Danya Kumar, a resident of J.T. Koppal, Kuvempunagar.

In the auction conducted by the KHB on 6.11.1996 the petitioner Mohan Kumar had offered Rs. 17,25,000, the highest among 93 other bidders. The KHB by an endorsement on 12.12.1996 rejected the offer on the ground that it was less than the market rate.

In his writ petition, the petitioner had alleged that the same site was auctioned on 30.11.2001 in favour of Danya Kumar for Rs. 16,36,000 without ensuring wide publicity.

The offer of Danya Kumar was lesser than what the petitioner had offered in 1996, Mohan Kumar contended.

Housing Board Executive Engineer Sannamallappa in an affidavit dated 5.12.2008 had defended the auction and execution of sale deed in favour of Danya Kumar saying that the value of the site had drastically fallen on the date of sale.

The auction notification was published on 26.11.2001 and the auction was conducted on 30.11.2001. Upholding the argument of the petitioner that the time was too short, just 4 days, the High Court said that "the public auction ought to be held by extending reasonable time for the citizens to make arrangements to participate and place their bids. The reasonable time in any event ought to be in the least 15 days notice."

The judge in his verdict on June 14, 2010 observed that the KHB Executive Engineer's plea that the price of the site had fallen in 2001, is not supported by relevant material. "It cannot but be said to be a self-interested statement not worthy of acceptance and is in the direction to some how justify the acceptance of a low price in a hastily held public auction so as to advance the interest of Danya Kumar."

The Court expressed its doubt about the validity of the auction as the KHB failed to place before the court the material relating to 65 bidders who participated in the auction on 30.11.2001 and made their bids for the site.

The site in question is located right opposite the property of the petitioner.

Danya Kumar has obtained licence from the City Corporation to build a commercial complex and mortgaged it in favour of KSFC for a loan of Rs. 25 lakh.

Courtesy : Star Of Mysore