India, Feb. 7 -- The Bombay High Court has cancelled the court auction of leasehold rights to a prime 852-sq-metre plot in the JVPD Scheme at Vile Parle after finding that the property was grossly undervalued and that the bidding process appeared to be manipulated.

A single-judge bench of justice Madhav Jamdar also ordered the forfeiture of the Rs.10 lakh earnest money deposit (EMD) paid by each of the five bidders, holding that their conduct showed that the court auction had lost its credibility and fairness.

An earnest money deposit, often called a "good faith deposit," is a sum of money paid by a buyer to a seller to demonstrate serious intent to purchase a property or complete a business transaction.

The court was hearing the matte...