Punjab Infotech told to refund Rs 4 crore forfeited by it to bidder

In an embarrassment for Punjab Infotech,the Punjab and Haryana High Court has termed its action to forfeit money of a bidder as “unreasonable and unsustainable”.

Written by Express News Service | Chandigarh | Published: July 21, 2012 1:22 am

In an embarrassment for Punjab Infotech,the Punjab and Haryana High Court has termed its action to forfeit money of a bidder as “unreasonable and unsustainable”.

Justice Mahesh Grover has directed the firm,which is a nodal agency of the Punjab government to promote IT industry in the state,to refund an amount of nearly Rs 4 crore,which was paid by a bidder to purchase commercial site in Mohali. Nirankar Singh from Mohali had won the auction of 1.52-acre commercial site located in Mohali for Rs 62 crore. The reserve price for the prime commercial property was fixed at Rs 35 crore. The auction took place on July 29,2011.

As per the contract,Nirankar paid ten percent of the amount at the time of auction and another Rs 90 lakh on the following day. In total,he paid nearly Rs 4 crore. However,he was later unsure of availability of infrastructure and feasibility of the project and thus requested the official respondents to refund the money deposited by him.

The request was rejected and the money deposited by him was forfeited by Punjab Infotech. Aggrieved,Nirankar moved the Court. Senior advocate Puneet Bali,counsel for Nirankar,contended that the act of forfeiture by the firm was contrary to rules. On the other hand,the respondents justified the act by stating that the petitioner (Nirankar) had violated the contract and hence the forfeiture was justified.

However,the Court ruled that it “cannot be oblivious to the fact that the respondents have been put to unnecessary and avoidable unease on account of the action of the petitioner in backing out from the proceedings after depositing the initial amount. This certainly is likely to result in pecuniary loss to them if they have to undertake the process afresh”.

Hence,the petitioner has been “burdened with costs of Rs10 lakhs which shall be deducted from the amount which the respondents have forfeited”.

The remaining amount,the High Court has ruled,is to be paid by Punjab Infotech to the petitioner within six months.

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