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A Bidder do not acquire Ownership Rights unless the Bid is expressly approved by the Competent Authority --- Supreme Court of Pakistan

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A Bidder do not acquire Ownership Rights unless the Bid is expressly approved by the Competent Authority --- Supreme Court of Pakistan

Islamabad 11-03-2025: The Supreme Court of Pakistan, in a landmark judgment [C.A. No. 613 OF 2020], reaffirmed the principle that a bid at an auction is merely an offer and does not confer ownership rights unless formally approved by the competent authority. The Court dismissed the appeal filed by Appellants and others against the Chairman, Evacuee Trust Property Board (ETPB), Lahore, regarding a disputed auction of 49 kanals and 11 marlas of land in Haripur.

The judgment, authored by Mr. Justice Miangul Hassan Aurangzeb and Mr. Justice Shahid Waheed, ruled that the ETPB had the right to cancel the auction without assigning any reason, as per Clause 8 of the auction terms and conditions. The Court also cited precedents from past case law, emphasizing that merely submitting the highest bid or matching it does not create any enforceable legal right. The Appellants, who had exercised their right to match the highest bid but failed to obtain approval from the ETPB Chairman, sought a declaration of ownership based on their bid, which the Supreme Court of Pakistan rejected.

The ruling relied on key judgments, including Captain-PQ Chemical Industries (Pvt.) Ltd. Vs. A.W. Brothers (2004 SCMR 1956), Afzal Maqsood Butt Vs. Banking Court No.2, Lahore (PLD 2005 SC 470), and Javed Iqbal Abbasi & Company Vs. Province of Punjab (1996 SCMR 1433), which established that bidders in auctions do not acquire property rights until their bid is confirmed. The Court held that since the approval was never granted, the appellants had no legal basis to claim ownership or demand completion of the sale.

The Supreme Court of Pakistan also clarified that re-auctioning the property does not violate Natural Justice, as long as all bidders are given an equal opportunity to participate. The appeal was dismissed without costs, solidifying the principle that government authorities conducting auctions retain discretion over approval and cancellation of bids.