1. ' SHAFIUR RAHMAN, J.-- Leave to appeal was granted to examine whether by upholding the transfer of the disputed shop in favour of respondents Nos.2 and 3, the Lahore High Court has not by its judgment, dated 4-7-1979, overlooked the provisions of para. 3-A of Settlement Scheme No,VIII.
2. ' Shop No,1/9, Qila Suba Singh, Tehsil Narowal, District Sialkot became available for disposal by auction. When put to auction on 9-9-1960, it fetched a bid of Rs,675 from one Mr. Ghulam Qadir against its reserve price of Rs,1,440. A P.T.O. Was issued to Ghulam Qadir on 27-12-1960. The same property was again put to auction on 26-5-1962 against the reserved price of Rs,1,440 and the highest bid of Rs,50 was offered by Ghulam Nabi respondent No,2. The same property was put to auction third time on 29-10-1963 with the reserve price of Rs,1,440 and it fetched the highest bid of Rs,750 from the appellant No,1. This bid appears to -have been approved by the Chairman of the Committee on 16-1-1964 and a P.T.O. Issued on 20-1-1965 which records the approval by Mr.M.A.A.
3. Wasti, Additional Settlement and Rehabilitation Commissioner by Order, dated 16-1-1964. Malik Muhammad Abdullah, deposited Rs,190 as security but thereafter failed to clear the dues. On his not responding to the notice, the following Order was passed by the Deputy Settlement Commissioner on 13-7-1967:-- "Mr. Muhammad Abdullah etc. Ss/o Allah Ditta transferee of Property No, Shop No,1/9, Q.S. Singh was served with a notice under section VIII and para. 24 of Schedule attached to the Act on 4-1-66 to pay the arrears of transfer price. He has failed to pay within six months since service of notice.
4. Therefore, I resume the abovenoted property under para. 3 of Settlement Scheme VIII and place it in compensation pool. Out of the amount paid by the transferee a sum of Rs,48 is forfeited. The transferee to be informed."
5. ' It appears that in the next month, the appellant No,1, approached the Accounts Officer, Sialkot, got the challan forms prepared by him on 15-8-1967 and deposited the balance of the price (Rs,560) as also the settlement fee (Rs,3.75) in respect of the shop. The order of resumption does not appear to have been formally set aside. The result was that the shop was put to auction for the fourth time on 17-8-1967 but it fetched no bid. The occupant of the shop was shown to be Muhammad Abdullah and its reserve price this time was shown to be Rs,750.
6. ' It appears that Ghulam Qadir, the first auction-purchaser filed an application in 1968 claiming adjustment of the deposit of Rs,170 made by him for the bid that he had offered in respect of this shop and which bid had not fructified. As Ghulam Qadir had purchased another shop in auction (Shop No,4/9), he did not pursue his case in respect of Shop No,1/9. On 17th October, 1972, Ghulam Nabi respondent No,2, filed an application reviving his claim on the basis of the bid of Rs,50 and ultimately agreed to purchase the shop on its reserve price. The Deputy Settlement Commissioner prepared a long note for the Additional Settlement Commissioner and submitted him who asked for the instructions on the subject and there is nothing to show that the instructions on the subject were put up to him. The recommendations of the Deputy Settlement Commissioner recorded on 29-12-1972 were as hereunder:-- "This auction was neither yet confirmed nor cancelled and the property was third time put to auction and purchased by M/s. Muhammad Abdullah and Rahmat Ullah for Rs,750, while the regular procedure was to ask Mr.Ghulam Nabi to make good the difference of auction price and reserve price failing compliance of which the auction was to be cancelled and then put to Compensation Pool for fresh disposal as required through the instructions circulated vide No,1936- Pol/63, dated 26-4-63. As is evident from the record, said Ghulam Nabi was not asked at that time to make good the difference of auction price as well as reserved price.As the auction in favour of Ghulam Nabi against Rs,50, a single bid case, was neither yet cancelled nor he was asked to make good the difference, therefore his auction case was alive and he was called and asked if he is prepared to pay Rs,1,390 who was agreed to pay the said amount. It is, therefore, submitted that the irregular/unsigned auction, dated 12-9-1960 may please be deconfirmed so that the difference of reserve price and auction price may be realized from the purchaser Ghulam Nabi and his case re-submitted for the confirmation of auction, dated 26-5-62 in his favour."
7. ' Ghulam Nabi associated with Inayat Ullah and it was Inayatullah who deposited the entire amount of Rs,1,440 on 6th of January, 1973 alongwith the settlement fee of Rs,7.20.
8. ' On 23-10-1973, Abdullah appellant applied for a clearance certificate in order that he may obtain the P.T.D. A report was submitted to the Settlement and Rehabilitation Commissioner in the words that follow:-- "In view of the above facts the auction, dated 29-10-65 in favour of M/s. Muhammad Abdullah and Rehmat Ullah may be upheld in presence of instructions contained in Letter No,1936-Pol/63, dated 26-4-63 as they have offered bid higher than 25 per cent. Of the reserve price. Furthermore they have paid the auction price vide Challan No, Nil, dated 16-8-67. Hence property may be ordered to be restored and auction allowed to stand in their favour."
9. ' It was approved by the Settlement Commissioner on the same day (23-10-1973).
10. ' This Order of the Settlement Commissioner was challenged successfully by the respondents in the constitutional jurisdiction. The decision of the High Court proceeded on the assumption that the auction in favour of respondent No,2 subsisted even after the auction in favour of appellant had taken place. Further it was held that the order of cancellation passed on 13-7-1967 had attained finality in spite of the fact that the Office of the Officer concerned had allowed and participated in getting the balance price deposited from the appellant. The provisions of para.3-A of the Settlement Scheme No,VIII were not noticed.
11. ' Mr. Muhammad Abdullah, Advocate, the learned counsel for the appellants has contended that with the third auction having been held on 29-10-1963 and that auction having not been challenged at any stage by any one whatsoever, the earlier proceedings in respect of the same property could not subsist nor rights could be claimed on the basis of any earlier auction. The other contention of the learned counsel for the appellant is that the Deputy Settlement Commissioner in his Report, which did not culminate in the order of Additional Settlement Commissioner and the High Court in its judgment, has extended the benefit of instructions which were issued in 1963 to an auction held in favour of respondent Ghulam Nabi on 26-5-1962. When that auction was held and a bid of Rs,50 was not approved, there was no power vesting in the Settlement Authorities at that time to approve such a hid. Instructions coming into existence subsequently, could not be made the basis for reviving the claim. Finally it has been contended that the Deputy Settlement Commissioner, the Accounts Officer and everyone concerned on the request of the appellants, allowed them to deposit all the amount due and the challan forms bear the signatures and the seal of the Accounts Officer by which payment was made. In view of the provisions of para. 3-A, reproduced in the leave granting Order the rights of the appellants in the property continued to subsist. The respondents could not reappear on the scene in 1972 and got the matter concluded in 1967 reopened from the Settlement Authorities. The order of the Settlement Authorities impugned in the Constitution petition was, according to the learned counsel, the only appropriate order that should have been passed.
12. ' Sh. M.Nasccm , Advocate, the learned counsel for the contesting respondent submitted that as the auction bid offered by the respondents had not been finally disposed of, the matter remained pending and as soon as the property was cancelled from the name of the appellants, their claim to it was revived and rightly honoured by the Settlement Authorities. The Appellants having not questioned the order of resumption could not agitate it in these proceedings and at this stage.
13. Mere deposit of the balance price created no right in their favour.
14. ' In the first place, when the property was obtained in auction by the appellants Nos.2 and 3, two auctions had already taken place. With the second auction the rights under the first auction disappeared and with the third auction the rights under the second, unless the matter had been challenged and the controversy kept alive. Besides, by offering a bid of Rs,50 when the reserve price was Rs,1,440 the respondents acquired no vested right at all. The instructions in the field at that time were as hereunder:-- "Auction of Shops ' (Memo. No,4499-PI-Rch/60, dated 9th/16th March, 1960)
15. ' With reference to this Office Memorandum No,839-PI-Rch/60, dated 9th January, 1960 on the above subject. It has been reported that in some cases the highest bid offered in the auction of shops has been below the reserve price fixed on the basis of 40 years gross annual rent for 1946. In some cases there have been no bids as it was proposed to start the bid at the reserve price. The Chief Settlement Commissioner has decided that in suitable cases the Chairman, Auction Committee may start the bid below the reserve price. If the highest bid offered is less than the reserve price, the Additional Settlement Commissioner of the area concerned may at his discretion transfer the shop to any person by negotiation who is prepared to offer a reasonable price.
16. ' The same principles may be adopted while auctioning the houses which could not be disposed of by earmarking."
17. ' In view of these instructions, the appellants could claim no vested right whatsoever, in the auction and the proceedings and the bid which stood superseded by the subsequent auction of the same property. There could not be revival of its claim at all. Besides, the instructions of 1963 could not be applied to this case which had to be governed by the instructions in the field on 25-6-1962 when the auction was held.
18. ' The Settlement Authorities having permitted the deposit of the entire balance price including the settlement fee on 16-8-1967, substantial compliance with para. 3-A of Settlement Scheme No,VIII has been done and as it happened at a time when none had a vested right in the property, to question its restoration to the auction-purchaser, the rights of the appellants got established beyond attack by subsequent proceedings.
19. The upshot of the above discussion is that the appeal is allowed with costs, the impugned judgment of the High Court is set aside and the order of the Settlement Commissioner is restored.