Kerala High Court Asks Departments, PSUs To Include All Details In Notice Of Auction Tender For Disposal Of Condemned Government Vehicles

The Kerala High Court was considering a matter where the auction of a vehicle originally belonging to the Kerala Forest Department was conducted after the statutory expiry of registration.

The Single Bench of Justice Mohammed Nias C.P. held, “Therefore, all Departments, Public Sector Undertakings, autonomous bodies, and auctioning agencies, including MSTC and any other Government-authorised platforms, shall ensure that every auction notice for disposal of condemned Government vehicles mandatorily specifies: (i) the year of purchase/initial registration, (ii) a clear statement that the vehicle has completed or is nearing completion of fifteen years, (iii) the statutory bar under Rule 52A of the Central Motor Vehicles Rules, 1989 prohibiting renewal or fresh registration after the fifteenth year, and (iv) that such vehicles are fit only for scrapping and cannot be registered for road use.”

“Accordingly, the respondents are directed to expressly include all details/statutory restrictions mentioned above in every notice of auction/tender, etc, to be conducted in future, without exception. Failure to do so will expose them to the legal actions stated above”, it ordered.

Advocate V. Visal Ajayan represented the Appellant, while Deputy Solicitor General of India represented the Respondent.

Factual Background

The Petition before the High Court was filed by the auction purchaser and present custodian of a Mahindra LMV Motor Car. The said vehicle originally belonged to the Kerala Forest Department and was brought for e-auction through the third respondent, MSTC Ltd., a public sector undertaking under the Ministry of Steel. The vehicle was originally registered with the first respondent. Pursuant to the payment, the Range Forest Officer released the same to the petitioner along with the original registration certificate. After taking delivery, the petitioner approached the Regional Transport Officer for endorsement of the transfer of ownership in his name.

The registering authority declined to effect transfer, stating that under Rule 52-A of the Central Motor Vehicles Rules, 1989, the certificate of registration of a Government vehicle expires after fifteen years from the date of its initial registration and cannot be renewed thereafter. It was the petitioner’s case that once ownership stands transferred through a valid auction sale, the vehicle ceases to be Government property and the bar on renewal or continued registration under Rule 52-A no longer survives.

Reasoning

The Bench noted that the auction itself was conducted after the vehicle had already completed fifteen years from its initial registration, and upon such expiry, Rule 52A of the Central Motor Vehicles Rules, 1989 imposed an absolute statutory prohibition on renewal or continuation of the registration of any Government vehicle. “By virtue of sub-rule (2), such vehicles, after the fifteenth year, can only be disposed of through a Registered Vehicle Scrapping Facility and cannot, under any circumstance, be registered for road use by a private purchaser”, it explained.

The Bench noticed that the auction was conducted after the statutory expiry of registration, at a time when the law expressly prohibited re-registration or road use of such a Government vehicle, and therefore, the petitioner was never legally capable of obtaining transfer of ownership, notwithstanding the auction.

The Bench observed, “A citizen purchasing from the government is entitled to presume that the State will not act in a manner that misleads or disadvantages him. Failure to disclose statutory bars, for instance, where the Motor Vehicles Act, the Central Motor Vehicles Rules, the Environmental Statutes, or Departmental Circulars prohibit the reregistration of certain categories of vehicles, amounts to suppression of material facts, which is impermissible for a public authority.”

Stating that the Government-authorised platforms should ensure that every auction notice for disposal of condemned Government vehicles must include all details/statutory restrictions, the Bench ordered, “Since these auctions are conducted by Government authorities, their notifications and decisions must not mislead the public and must be fair, transparent, and citizen-friendly.”

Cause Title: Jibin Shaji v. Kerala Forest Department (Neutral Citation: 2025:KER:87949)

Appearance

Appellant: Advocates V. Visal Ajayan, Francis Thenamparambil

Respondent: Deputy Solicitor General of India O.M.Shalina, Special Govt. Pleader (Forest) Sangeeth C.U., Advocate T.V.Vinu

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