legal stand in Sep 2014

Businessman gets relief after zero cost him Rs. 5 lakh

Three years after losing Rs. 5 lakh for making a wrong entry in a tender bid in an e-auction, a businessman has got relief from the Madras High Court.

The court has ordered that the money, deposited as Earnest Money Deposit (EMD) in the e-auction, be refunded with interest within four weeks after deducting the expenses incurred for conducting a fresh auction.

Instead of quoting his bid as Rs 12,24,202, Mohammed Thayyib of Hameed Enterprises here added a zero, quoting Rs.1,22,42,002, at the e-auction conducted by IIT-Madras in September 2011.

After the auction ended, he found the typographical error. He gave a representation to the IIT-M the same day, requesting it to accept his tender as Rs.12,24,202.

But the EMD was forfeited as he was the highest bidder. As he did not pay the balance sum, a re-auction was held.

As his bid was neither accepted nor the EMD returned, despite requests, he issued a lawyer’s notice. By an impugned communication of October 25, 2012, the institution said his EMD had been forfeited. He then moved the High Court.

The IIT contended that as per the tender conditions, EMD could be forfeited, if the highest bidder failed to pay the balance sum within seven days. A re-auction had to be conducted.

Allowing the petition, Justice N. Paul Vasanthakumar said there was a clear illegality in conducting the e-auction.

Fixation of upset price was admittedly not disclosed in the auction notice. Also, the acceptance of the petitioner’s bid by the institution’s authorised agent was only provisional.

The condition on EMD forfeiture could not be put against the petitioner as mandatory procedure of disclosing the upset price before the e-auction was not followed in this case.

“It is well settled in law that a person accusing another person must be perfect in his duties and if there is failure to do his duty, he cannot accuse others for not obeying the obligation.”

The scrap fetched only Rs.45.52 lakh in the subsequent auction. It was clear proof that the petitioner’s intention was not to quote Rs.1,22,42,002, the Judge said.

Instead of quoting his bid as Rs. 12,24,202, Mohammed Thayyib of Hameed Enterprises added a zero, quoting Rs. 1,22,42,002, at the e-auction conducted by IIT-Madras in September 2011

Notary Public can be prosecuted only on compliant from officials

A Notary Public cannot be prosecuted on the charge of having made attestations in collusion with criminals unless a complaint was filed by officers authorised to do so by either the Centre or the State government, the Madras High Court Bench here has held.

Justice P.R. Shivakumar passed the ruling, allowing a petition filed by V. Ramakrishnan, a Notary Public, to discharge him from a case filed by the Central Bureau of Investigation against a group of individuals for having conspired to obtain passports in fictitious names.

Though the judge agreed with the CBI that a prima facie case had been made out against the revision petitioner, requiring him to face trial, he allowed the discharge petition on the ground that the complaint had not been filed by the authorised officers as required under Section 13 of the Notaries Act, 1952.

He held that a special court for hearing CBI cases here committed a mistake by dismissing the petitioner’s discharge application on March 5 since the Act states that no court should take cognisance of offences committed by a notary unless the complaint was made by authorised officials.

Mr. Justice Shivakumar agreed with M. Subash Babu, counsel for the petitioner, that the High Courts of Karnataka and Bombay had taken a similar view in two cases and quashed the criminal proceedings against Notary Public in their regions.

“When there is a special enactment dealing with the official acts or purported official acts of the notary, the provision of the special enactment will prevail over the general law. Hence, this court comes to the conclusion that taking cognisance of the offences against the revision petitioner is against law,” he said.

Nevertheless, the judge agreed with G.R. Swaminathan, Special Prosecutor for the CBI, that the petitioner’s act of having attested documents in favour of fictitious individuals, at the instance of another lawyer who had been suspended from acting as a notary, could not be termed “innocent.”