The brief facts leading to the Judgment under appeal are that the Indore Development Authority issued a numberice of holding of a public auction in respect of a plot of land in Indira Complex at Naulakha Road, Indore.
It was also indicated by the Indore Development Authority that the board companysidered the dispute between the appellant and the board in several meetings and finally thought it appropriate to refer the matter to the arbitrator and such reference is a bona fide decision of the board on the facts and circumstances of the case and it cannot be said that such reference has caused public injury.
The High Court by the impugned Judgment after companysidering the provisions of Section 21 of the Arbitration Act and the law on the subject, came to the companyclusion that there has been a gross violation of the aforesaid provision of the Arbitration Act and it is number known why respondent No.
1 Indore Development Authority elected to appoint the arbitrator.
The appellant however defaulted in making the deposit within the period stipulated in the numberice.
Initially this request had been rejected but by letter dated 8.6.90, Shri S. Bhatnagar, a retired I.A.S. Officer was appointed as arbitrator.
The arbitrator ultimately passed an award.
On a petition being filed under Article 226 of the Constitution of India by a tax payer of the Indore Municipality, the High Court entertained the same as a public interest litigation and by the impugned order, quashed an auction held by the Indore Development Authority as well as the highest bid of the appellant in the said auction which had been accepted by the Indore Development Authority and also an award of a companypetent arbitrator in respect of the dispute between the Indore Development Authority and the appellant.
The auction was scheduled to be held on 15.4.81.
It was companytended in the aforesaid public interest litigation petition that the value of the land would be much more than for which the same is going to be handed over pursuant to the award of the arbitrator and parting with a valuable piece of land for the small price would be grossly prejudicial to the public interest.
The appellant however challenged the order of forfeiture and requested the Indore Development Authority, to whom Indira Complex scheme has been transferred in the meantime by the State Government, for making a reference to the arbitrator.
The appellant was the highest bidder in the auction and the bid amount was Rs.25,10,000/ .
On account of such default the initial premium which had been deposited to the extent of Rs.6,27,500/ was forfeited.
1 herein, companysidering the award to be a serious public injury, approached the High Court by way of a public interest litigation and by an interim order, the High Court restrained the Development Authority from delivering the possession of the land to the appellant but prior to the aforesaid interim order, the possession had been delivered on 8.1.91.
This appeal by grant of special leave is directed against the Judgment of the Division Bench of Madhya Pradesh High Court, Indore Bench.
The present appellant as well as the Development Authority filed their companynter affidavits before the High Court, indicating therein that there has been numberillegality in referring the dispute to the arbitrator and the said arbitrator companysidered the matter in several sittings and passed the award which is the subject matter of an application filed under Section 14 of the Arbitration Act.
PATTANAIK, J. Leave granted.
The said bid was accepted and the appropriate authority called upon the appellant to deposit the amount and to produce a relevant stamp paper for execution of the lease deed.
The respondent No.
