Tiruppur Market Shop Seeker’s Preferential Allotment Claim Is Premature Before Auction, Madras HC Says

The petitioner claimed to have held a valid licence for a shop in Tiruppur’s old market. The first respondent took possession of the shop during the licence period to construct a new market complex.

After construction, the petitioner sought preferential allotment of Shop No. E-11 under G.O. No. 92 dated 3 July 2007 and G.O. (2D) No. 66 dated 6 August 2024; the application was rejected by proceedings dated 16 May 2025. The petitioner challenged that rejection and sought a direction for allotment.

The Court later corrected the references to the applicable rule in paragraphs 4 and 6 of its order: the correct provision is Rule 316(11)(a), not Rule 316(11)(8).

Rule 316(11)(a) of the Tamil Nadu Urban Local Bodies Rules, 2023 provides that, where a licence for a municipal rental shop is granted by auction, the Council may, on application, give preference to existing licensees of a demolished shopping complex in cases of demolition and reconstruction, provided they match the highest bid and produce documents establishing eligibility.

The Government Orders relied on by the petitioner were identified in the judgment, but the Court’s stated basis for its disposition was Rule 316(11)(a).

The Court found that the first respondent had not yet conducted a public auction for the shop.

Because Rule 316(11)(a) makes preferential consideration conditional on an auction and on the former licensee matching the highest bid and establishing eligibility, the petitioner could not obtain an immediate allotment before those steps occurred.

The request was therefore premature, without foreclosing a later application under the Rule.

If the shop is notified for public auction and the petitioner applies, the first respondent must consider the application in accordance with the Rule, subject to the petitioner meeting its conditions. No order as to costs was made.