Rajasthan High Court - Jodhpur
Sita Ram vs State Of Rajasthan & Ors on 29 November, 2017
HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
JODHPUR
S.B. Civil Writ Petition No. 6160 / 2017
Sita Ram S/o Shri Pratap Singh, Aged About 35 Years, R/o
Bambalawas, Tehsil Bhadra, District Hanumangarh (Raj.)
----Petitioner
Versus
1. The State of Rajasthan Through the Secretary, Department of
Finance (Expenditure-2), Secretariat, Rajasthan, Jaipur.
2. Rajasthan State Road Transport Corporation, Through Its
Managing Director, Parivahan Marg, Jaipur.
3. Chief Manager, RSRTC, Hanumangarh Depot, Hanumangarh.
----Respondents
Connected With
S.B. Civil Writ Petition No. 6163 / 2017
M/s Sita Ram S/o Shri Pratap Singh, Aged About 35 Years, R/o
Bambalawas Teshil Bhadra, District Hanumangarh. (Raj.)
----Petitioner
Versus
1. The State of Rajasthan Through the Secretary, Department of
Finance (Expenditure-2), Secretariat, Rajasthan, Jaipur.
2. Rajasthan State Road Transport Corporation, Through Its
Managing Director, Parivahan Marg, Jaipur.
3. Chief Manager, RSRTC, Hanumangarh Depot, Hanumangarh.
----Respondents
S.B. Civil Writ Petition No. 6252 / 2017
M/s Bhagirath Dudhwal S/o Shri Ramchandra, Aged About 65
Years, R/o Ward No. 16, Ambedkar Colony, Street No. 1,
Hanumangarh Town, (Raj.)
----Petitioner
Versus
1. The State of Rajasthan Through the Secretary, Department of
Finance (Expenditure-2), Secretariat, Rajasthan, Jaipur.
2. Rajasthan State Road Transport Corporation, Through Its
Managing Director, Parivahan Marg, Jaipur.
(2 of 9)
[ CW-6160/2017]
3. Chief Manager, RSRTC, Hanumangarh Depot, Hanumngarh.
----Respondents
S.B. Civil Writ Petition No. 6254 / 2017
M/s Gurjeet Singh S/o Gurdev Singh, Aged About 40 Years, R/o
7/25, New Housing Board, Hanumangarh Junction (Raj.)
----Petitioner
Versus
1. The State of Rajasthan Through the Secretary, Department of
Finance (Expenditure-2), Secretariat, Rajasthan, Jaipur.
2. Rajasthan State Road Transport Corporation, Through Its
Managing Director, Pariavhan Marg, Jaipur.
3. Chief Manager, RSRTC, Hanumangarh Depot, Hanumngarh.
----Respondents
S.B. Civil Writ Petition No. 7893 / 2017
M/s Ikbal Khan Kaji Son of Shri Salim Mohmmad, Aged About 30
Years, Resident of Upar Kota Saidon Ka Vas, Jalore.
----Petitioner
Versus
1. State of Rajasthan Through the Secretary, Department of
Finance (Expenditure-2), Secretariat, Rajasthan, Jaipur.
2. Rajasthan State Road Transport Corporation, Parivahan Marg,
Jaipur. Through Its Managing Director.
3. The Chief Manager, Rajasthan State Road Transport
Corporation, Jalore Depot, Jalore.
----Respondents
S.B. Civil Writ Petition No. 7895 / 2017
M/s Sumitra Kanwar Wife of Sharwan Singh, Aged About 45 Years,
Resident of 176, Rajputon Ka Was, Sendria, Balotra, Tehsil- Ahore,
District- Jalore.
----Petitioner
Versus
1. State of Rajasthan Through the Secretary, Department of
Finance (Expenditure-2), Secretariat, Rajasthan, Jaipur.
(3 of 9)
[ CW-6160/2017]
2. Rajasthan State Road Transport Corporation, Parivahan Marg,
Jaipur. Through Its Managing Director.
3. The Chief Manager, Rajasthan State Road Transport
Corporation, Jalore Depot, Jalore.
----Respondents
S.B. Civil Writ Petition No. 7898 / 2017
M/s Sumitra Kanwar Wife of Sharwan Singh, Aged About 45 Years,
Resident of 176, Rajputon Ka Was, Sendria, Balotra, Tehsil- Ahore,
District- Jalore.
----Petitioner
Versus
1. State of Rajasthan Through the Secretary, Department of
Finance (Expenditure-2), Secretariat, Rajasthan, Jaipur.
2. Rajasthan State Road Transport Corporation, Parivahan Marg,
Jaipur. Through Its Managing Director.
3. The Chief Manager, Rajasthan State Road Transport
Corporation, Jalore Depot, Jalore.
----Respondents
_____________________________________________________
For Petitioner(s) : Mr. H.S. Sidhu
Mr. Amit Mehta
For Respondent(s) : Mr. Rajesh Panwar, AAG with Mr. Sunil Joshi
Mr. Harish Purohit
_____________________________________________________
HON'BLE MS. JUSTICE NIRMALJIT KAUR
Judgment / Order 23/11/2017 All the above-mentioned writ petitions shall stand decided by this common order as the issue involved is identical.
The facts are taken from CWP No.6160/2017.
The present writ petition has been preferred against the (4 of 9) [ CW-6160/2017] impugned order dated 3.4.2017 and the consequential order dated 20.04.2017 vide which the VGF amount liable to be paid in terms of the Scheme was discontinued without giving any notice and without complying with the terms of Article 10.4 of the agreement.
A scheme was introduced as a pilot scheme for rural connectivity in the Budget Session 2011-12 known as Gramin Parivahan Sewa Yojna. The object of the scheme is to provide for operation of privately owned stage carriage services on financing, procurement, own operation and management of Buses on specified Cluster (group of routes) in Rural areas of Rajasthan, connecting all village Panchayats to Tehsil headquarter, district headquarters, Krishi Upaj Mandies, educational institutions, hospitals, industrial areas, bus terminals and railway stations etc. to the extent possible.
As per the scheme, the RSRTC was to grant authorization to the preferred bidder for a maximum period of 6 years to provide bus services in a Cluster, use the road infrastructures, bus stops terminals and other assistance as may be available with RSRTC in the region. As per article 1.1 of the agreement, petitioner has to provide the buses for a period of 6 years or coverage of 7 lac kms whichever is earlier. It is further provided that the petitioner shall receive Viability Gap of Rs.8.50 and 8.00 km from RSRTC as per terms and conditions of the RFP and the agreement. As per article 3.1 (f) of the agreement, the amount of Viability Gap shall be paid by the RSRTC as per clause 7(2) of the agreement. As per article (5 of 9) [ CW-6160/2017] 7.2.1, the amount of daily Viability Gap quoted by the operator on the basis of the rate per kilometer for a cluster shall be paid to the operator by the RSRTC as per the table given in the said article. After execution of the agreement between the petitioner and the respondents, a letter was issued by the respondents on 28.04.2014 to operate the buses for cluster No.6 to the petitioner. As per the said order, the petitioner started to run the buses for the cluster No.6 as per the terms and conditions laid down between the parties by way of agreement annex.P/2. Suddenly, the respondent No.1 issued an order dated 3.4.2017 discontinuing to pay the VGF amount w.e.f. 31.03.2017. The present writ petition has been filed being aggrieved with the said order.
While praying for setting aside the impugned order, learned counsel for the petitioners raised the following arguments:-
1. The said order was passed without giving an opportunity of hearing to the petitioner and without any reasons.
2. No reason has been mentioned in the order as to why this amount has been discontinued by the respondents specially when the State Government has sanctioned the amount under the head of VGF for the year 2017-18 total as Rs.2000 lacs.
3. The said order has been issued contrary to the terms and conditions of the agreement. As per article 7.2.1 of the agreement the amount of VGF shall remain unchanged for the entire period of authorization i.e. for 6 years. The agreement was made with the petitioner to run buses for the cluster No.6 for six years.
4. Looking to the benefit of the scheme that the VGF amount (6 of 9) [ CW-6160/2017] will be paid by the Government for six years during the currency of the agreement to the petitioner, the petitioner purchased the new mini buses and got them financed from the bank. The petitioner changed his situation on the offer of the respondents and now it is not open for the respondents to take U-turn and discontinue the VGF amount within an arbitrary manner after the petitioner has made huge investment.
Reply has been filed. Learned counsel for the respondents while opposing the writ petition submitted that the said scheme is not enforceable. It is an obligation flowing from the contract which is not binding. There is an arbitration clause in the agreement and therefore, he should avail the said remedy. Further, the State has taken a decision after looking to the financial exigency and burden on the State against the scheme which is resulting in financial losses and the said scheme is not even beneficial for public at large on account of lackadaisical attitude of the bus operators. In addition, it is submitted that the scheme got evaluated by the Corporation at their level after taking note of the irregularities committed by the cluster bus operators. The operators are not acting as per the terms and conditions of the agreement executed between RSRTC and bus operators even after imposition of penalties. Therefore, the State has taken conscious decision after looking to the aforesaid impediments.
Heard.
Admittedly, the petitioner operators were continuously getting the payments of VGF amount for three years. Reliance (7 of 9) [ CW-6160/2017] placed on Annexure-P/3 and P/5 to show that sanction has been received from the Government for the year 2017-18 is misplaced. A perusal of the said document shows that same is only an estimate and not the sanction as alleged.
The petitioner herein is seeking enforement of the contract. It is a well settled proposition of law that a contract between the parties is subject matter of private law. It is not a statutory contract. Hence, Article 226 of the Constitution cannot be invoked to agitate the dispute relating to such a contract.
Learned counsel for the petitioner however placed reliance on the judgment rendered in the case of Karnataka State Forest Industries Corporation Vs. Indian Roacks :: (2009) 1 SCC 150 to contend that a writ petition would nonetheless be maintained in case the action of the State is discriminatory and violative of Article 14 of the Constitution.
There is no dispute with the proposition of law laid down by the Apex Court in the case of Karnataka State Forest Industry Corporation (supra). However, the same does not help the petitioner in the facts of the present case. There is not an iota of allegation that the decision to discontinue the payment of VGF amount was arbitrary in any manner. It is evident from the reply that the same has been stopped in view of the scheme being no more financially viable as also on account of the irregularities committed by the operators themselves. At the same time, there is nothing on record to show that the said decision is discriminatory. The decision is applicable to all the operators who (8 of 9) [ CW-6160/2017] are registered under the scheme.
The Apex Court in the case of Kerala State Electricity Board and another Vs. Kurien E. Kalathil & ors. :: AIR 2000 SC 2573 while holding that ordinarily, remedy is not the writ petition under Article 226 of the Constitution for violation of the terms and conditions observed that the High Court fell in error in observing that the contractor was seeking enforcement of a statutory contract as no contract can become statutory simply because it is for construction of a public utility and it has been awarded by the statutory body. Para 11 of the said judgment reads as under:-
"A statute may expressly or impliedly confer power on a statutory body to enter into contracts in order to enable it to discharge its functions. Dispute arising out of the terms of such contracts or alleged breaches have to be settled by the ordinary principles of law of contract. The fact that one of the parties to the agreement is a statutory or public body will not of itself affect the principles to be applied. The disputes about the meaning of a covenant in a contract or its enforceability have to be determined according to the usual principles of the Contract Act. Every act of a statutory body need not necessarily involve an exercise of statutory power. Statutory bodies, like private parties, have power to contract or deal with property. Such activities may not raise any issue of public law. In the present case, it has not been shown how the contract is statutory. The contract between the parties is in the realm of private law. It is not a statutory contract. The disputes relating to interpretation of the terms and conditions of such a contract could not have been agitated in a petition under Article 226 of the Constitution of India. That is a matter for adjudication by a civil court or in arbitration if provided for in the contract. Whether any amount is due and if so, how much and refusal of the appellant to pay it is justified or not, are not the matters which could have been agitated and decided in a writ petition. The contractor should have been relegated to other remedies."
(9 of 9) [ CW-6160/2017] Besides, there is a specific arbitration clause in the contract. Clause 12.3.2 of the contract reads as under:-
"12.3.2 Arbitration
(a) Arbitrators In the event the dispute or difference or claim, as the case may be, is not resolved, as evidenced by the signing of the written terms of settlement by the Parties, within 30 (thirty) days of reference for amicable settlement and / or settlement by the representatives, the same shall be finally settled by binding arbitration under the Arbitration and Conciliation Act, 1996. The arbitration proceeding shall be decided by a sole arbitrator and parties agree that for the purpose of this Agreement Chaiman/Chairman cum Managaing Director, RSRTC shall act as a sole arbitrator. The decision of the arbitrator shall be final and binding on all the parties.
In the instant case, all that is sought to be enforced is an obligation flowing from a contract which is a matter of adjudication by arbitration in terms of the contract or by a civil suit for claiming damages, as the case may be.
In view of the above, this Court finds no ground to interfere while exercising the jurisdiction under Article 226 of the Constitution. However, the petitioners are at liberty to invoke the arbitration clause or avail the alternative remedy as available to them in accordance with law.
Dismissed accordingly.
(NIRMALJIT KAUR), J.
Pdaiya/48-54