The case of a commune official winning the auction of 23 land lots in Quynh Luu district has not yet been resolved.

Deposit not returned

Nghe An Newspaper issue dated July 11, 2023 published an article "Clarifying information about a commune accountant winning the auction of 23 land lots in Quynh Luu district", reflecting the incident after the land auction on June 20, 2023 at the People's Committee of Quynh Hung Commune (Quynh Luu), Mr. Nguyen Van Trong - working at the People's Committee of Quynh Ba Commune, was the person who won the auction of 23 land lots in the Dong Quan auction planning area, Quynh Hung Commune (Quynh Luu). However, public opinion later reacted that, according to the Auction Law, Mr. Trong is the younger brother of Mr. Nguyen Van Quy - Vice Chairman of the People's Committee of Quynh Luu District (Mr. Quy is the person who signed the decision approving the starting price of the land lots put up for auction), so he is not eligible to participate in the auction but still voted to bid and was recognized by the auctioneer as the auction winner. After the incident, the People's Committee of Quynh Luu District stepped in to verify and did not recognize the auction results for the 23 land lots that Mr. Nguyen Van Trong participated in.

What makes Quynh Luu District People's Committee concerned is that Article 73 of the 2016 Law on Property Auction does not stipulate how to handle the deposit for customers in case of cancellation of the auction result as prescribed in Clause 1, Article 72 of the law. Therefore, Quynh Luu District People's Committee has requested the Provincial People's Committee to assign the Department of Justice to guide the District People's Committee in handling Mr. Nguyen Van Trong's deposit.

According to information from Quang Cong Minh Joint Stock Auction Company - the unit assigned to auction 56 residential lots in Dong Quan area, Quynh Hung commune, the amount of money that Mr. Trong's family had to deposit before participating in the auction of 23 lots of land was 4 billion 620 million VND. According to regulations, Mr. Trong's family had completed the deposit payment before the auction took place. However, up to now, nearly 4 months have passed since the auction took place and more than 3 months and 10 days since the auction unit returned the deposit to all individuals who were not recognized as winning the auction, but Mr. Trong's family has not yet received their deposit back.

Through investigation, we learned that on July 21, 2023, the Department of Justice issued Decision No. 127/QD-UBND to establish a Verification Team to verify the content of the reflection, organize work with Quang Cong Minh Joint Stock Auction Company and related parties to clarify the case. The verification results show that, for the auction of the right to use 56 residential land lots in Dong Quan area, Quynh Hung commune, on June 20, 2023, the total starting price was VND 59,798,749,500. Of which, 33 land lots were recognized as winning the auction, with a total starting price of VND 36,645,096,500, and a total winning price of VND 51,093,000,000, exceeding the starting price by VND 14,447,903,500 (exceeding 39.4%); The auctioned land lot with the highest price exceeding the starting price was 817,000,000 VND (62.8%); the auctioned land lot with the lowest price exceeding the starting price was 244,506,000 VND (24%).

Mr. Trong won the auction for 23 land lots (auction results have been canceled), starting price 23,153,653,000 VND, total winning auction price is 33,382,000,000 VND, exceeding the starting price by 10,228,347,000 VND (44.1%).

According to the verification results, Mr. Nguyen Van Trong is not eligible to register to participate in the auction, but participating in the auction is a violation of the provisions of Point b, Clause 4, Article 38, Law on Property Auction 2016. Therefore, on July 11, 2023, the People's Committee of Quynh Luu district issued Decision No. 1722/QD-UBND on not recognizing the auction results of 23 residential land lots in the Dong Quan planning area, Hamlet 5, Quynh Hung commune.

Regarding the deposit of Mr. Trong's family, according to Mr. Bui Thai Tho - Head of the Judicial Support Department, Nghe An Department of Justice, according to regulations, the deposit of Mr. Trong's family will be returned. Currently, the Department of Justice has also verified the results and reported directly to the Provincial People's Committee for further direction.

Need to consider reasonable solution

In addition to verifying the contents related to the auction, we learned that the Verification Team of the Department of Justice also drew up a record of administrative violations against Quang Cong Minh Joint Stock Auction Company for the following acts: Allowing unregistered persons to participate in the auction; publicly announcing the auction in violation of regulations (the second public announcement, dated June 6, 2023, on the specialized electronic information page on auctioning assets does not guarantee 15 days for real estate assets).

In addition, the auction organizer also made a record but did not detail the progress of the auction; let people who did not participate in the auction of each lot sign the auction record. Meanwhile, according to regulations, the progress of the auction must be recorded in the auction record. The auction record must be made at the auction and signed by the auctioneer, the record keeper, the auction winner, the owner of the auctioned property, and the representatives of the auction participants. In the case of an auction conducted by the Property Auction Council, the auction record must also be signed by the Chairman of the Council.

Mr. Trong's participation in the auction in this case is against the regulations and does not need to be discussed. However, it is necessary to carefully consider the issue here, whether Mr. Trong's participation is for profit or simply because of a real need to buy land. In fact, the price that Mr. Trong offered exceeds the starting price by 10,228,347,000 VND (44.1%).

However, according to Mr. Tho, the violations of the auction unit have only been recorded, but in reality, there has not been a specific decision on penalties. The authority to decide on administrative penalties in this case is issued by the Provincial People's Committee.

Returning to the story of Mr. Nguyen Van Trong participating in the auction of the 23 plots of land mentioned above, many people believe that it is necessary to clarify whether there was any intentional violation or just a lack of understanding leading to the violation? Because in fact, in addition to Mr. Trong participating in the auction, his son also won the auction of 20 plots of land in Dong Quan area, Quynh Hung commune, and these plots of land were also recognized as winning the auction.

Not to mention, canceling the auction results of the 23 plots of land mentioned above will certainly cause many problems. Firstly, it is mandatory to redo the auction process if you want to continue auctioning these 23 plots of land. At that time, the People's Committee of Quynh Luu district will have to choose another auction unit to carry out and will invisibly cause costs in all aspects, from time, effort, money to organize the auction. Another important thing is that there will be a risk of not being able to sell the auction for the same amount as the previous auction, and there may even be no buyers.

Obviously, land use rights auction is a method to help the State mobilize maximum revenue for the budget, create investment capital for infrastructure construction and socio-economic development. Based on the principle of fair competition between auction participants, the highest bidder will be the one to receive land use rights. This has contributed to bringing harmonious benefits to individuals, organizations and the State.

In this case, the Provincial People's Committee should come to a conclusion, especially regarding the deposit amount. Because this is personal property submitted to participate in the land auction to ensure the successful conclusion of the contract. Many people even think that the Provincial People's Committee should hire a valuation unit to objectively consider the current land price and the gains and losses when having to re-auction. If necessary, a document can be sent to the Ministry of Justice for a unified opinion.

Because as far as we know, due to the shortcomings of the 2016 Law on Property Auction, the project to amend and supplement a number of articles of the Law on Property Auction is currently being implemented by the Government and awaiting approval by the National Assembly. And according to Mr. Bui Thai Tho, the issue of auction participants stipulated in Article 38 of the 2016 Law on Property Auction has also been suggested to be amended to suit the current practical situation.