A public authority can revisit an auction to maximise the price of public property before a binding contract is concluded, the Supreme Court has held, in a judgment delivered on October 16, 2026 by a bench of Justice Pamidighantam Sri Narasimha and Justice Alok Aradhe, LiveLaw reported. The court set aside a Punjab and Haryana High Court judgment that had quashed the Chandigarh Administration's decision to cancel Bedi Hospital's bid for a nursing-home site.
The dispute concerned two identical nursing-home sites of 744.44 square yards each in Sector 33C, Chandigarh, auctioned in October 2022 with a reserve price of Rs 6.91 crore each — yaani about Rs 69.1 million per plot. Site No. 3 fetched Rs 18.25 crore, while Bedi Hospital was the highest bidder for Site No. 4 at Rs 12.58 crore. The hospital paid the full amount and signed an agreement to sell, but before any allotment letter was issued or conveyance deed executed, the Administration cancelled the bid in January 2023, refunded the money and said the price did not reflect market trends.
What the court held
The bench held that an agreement to sell in this scheme is not by itself an enforceable contract, which arises only on execution of the conveyance deed, and that the Administration could therefore withdraw the site or reject the highest bid before that stage — provided it did not act arbitrarily. A decision taken to secure the best price for public property, with the reason stated and the money refunded, was justified, the court said.
Directing a fresh e-auction of Site No. 4 within three months, the court noted the later auction had fetched Rs 18.30 crore, approximately Rs 6 crore more than Bedi Hospital's bid. The case is Satinder Pal Singh and Others v. Bedi Hospital and Others, arising from Special Leave Petition (C) Nos. 33791 and 33793 of 2025.
What is solid
- The Supreme Court bench of Justices Narasimha and Aradhe held a public authority may revisit an auction to maximise price before a binding contract is concluded — LiveLaw and LawFinder
- The court set aside the High Court's relief to Bedi Hospital and directed a fresh e-auction of the Sector 33C site within three months
- Site No. 4 drew Rs 12.58 crore against Rs 18.25 crore for the identical Site No. 3; a later auction fetched Rs 18.30 crore
What is only claimed
- The judgment was delivered on October 16, 2026; it is reported here as a national precedent on public auctions — Bedi Hospital had argued its accepted, fully paid bid should stand, a position the High Court had earlier accepted