Telangana High Court
Smt. Sanathana Vadla Rajini vs The Union Of India on 2 April, 2019
Equivalent citations: AIR 2019 TELANGANA 42, (2019) 3 ANDHLD 660
Author: P.Naveen Rao
Bench: P.Naveen Rao
HIGH COURT FOR THE STATE OF TELANGANA
********
WRIT PETITION NO.95 OF 2019
Between :
Smt Sanathana Vadla Rajani,
W/o.Gopal Chary, Aged about 41 yrs,
Occu : Business, R/o.H.No.3-8,
Athvelly Village, Medchal Mandal,
Medchal Malkajgiri District & another.
.... Petitioners
and
The Union of India,
Rep., by its Army Secretary,
Having its Office at South Hutments,
Kashmir House, Rajaji Marg,
New Delhi -110 011 & others.
.... Respondents
DATE OF JUDGMENT PRONOUNCED : 02.04.2019
THE HON'BLE SRI JUSTICE P.NAVEEN RAO
1. Whether Reporters of Local Newspapers : No
may be allowed to see the Judgments ?
2. Whether the copies of judgment may be : Yes
marked to Law Reporters/Journals
3. Whether Their Lordship wish to : No
see the fair copy of the Judgment ?
PNR,J
W.P.No.95 of 2019
-2-
*HON'BLE SRI JUSTICE P.NAVEEN RAO
+WRIT PETITION NO.95 OF 2019
%02.04.2019
# Smt Sanathana Vadla Rajani,
W/o.Gopal Chary, Aged about 41 yrs,
Occu : Business, R/o.H.No.3-8,
Athvelly Village, Medchal Mandal,
Medchal Malkajgiri District & another.
... Petitioners
Vs.
$ The Union of India,
Rep., by its Army Secretary,
Having its Office at South Hutments,
Kashmir House, Rajaji Marg,
New Delhi -110 011 & others.
.... Respondents
!Counsel for the petitioners : Sri K.Ramanyaneyulu
Counsel for the Respondents : Sri M.S.Achyuth Bharathwaj for
respondents 2 and 3;
Sri S.Lakshmi Kanth, counsel for
respondent No.4.
<Gist :
>Head Note:
? Cases referred:
AIR 1986 Delhi 128
2005 (6) ALD 312
(2015) 4 Supreme Court Cases 670
(2015) 7 Supreme Court Cases 728
PNR,J
W.P.No.95 of 2019
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HONOURABLE SRI JUSTICE P.NAVEEN RAO
WRIT PETITION No.95 OF 2019
ORDER :
Heard learned counsel for petitioners, Sri M.S.Achyuth Bharathwaj, learned counsel for respondents 2 and 3 and Sri S. Lakshmikanth, learned counsel for respondent No.4.
2. The Army Welfare Housing Organization (AWHO) proposed to sell Ac.26.55 of land in Sy.Nos.149(C,D), 150(B2), 88, 150(B3), 150(B), 150(A) & 151 of Athivelli Village, Yellempet Mandal, Medchal District.
3. On 08.06.2018 an advertisement was published in the daily newspapers inviting proposals from individuals, firms, companies, Government Organizations for purchase of the said land. The last date prescribed to respond was 31.07.2018. The first petitioner herein, 4th respondent along with 17 others responded to the said advertisement offering to purchase the land mentioned above. The first petitioner offered to purchase the land at the rate of Rs.1.70 Crores per acre to the land abutting the highway and rest of the land @ Rs.1.50 Crores. 4th respondent offered uniformly @ Rs.2.60 Crores per acre. 19 bids were opened by the Board of Officers on 01.08.2018. One bid was found blank. On evaluation of 18 bids, representatives were called for a meeting. Out of 18 bids which were evaluated only 12 bidders have responded and attended the bid meeting. On consideration of the individual offers made the Board of Officers recommended the bid of 4th respondent for a total sum of Rs.68.90 Crores being the highest bid. The 4th respondent was intimated that he was the successful bidder. The Special Board of Governors in the meeting held on 11.09.2018 approved the recommendation of the PNR,J W.P.No.95 of 2019 -4- Board of Officers. Accordingly, vide letter dated 18.09.2018, 4th respondent was informed about acceptance of his bid and asked to deposit 10% of the total amount offered by him as non-refundable earnest money by 03.10.2018. It appears, on a request made by 4th respondent, time to deposit earnest money was extended. So far, 4th respondent deposited Rs.17.025 crores including non-refundable advance. At this stage, first petitioner submitted a fresh offer saying that petitioner is willing to purchase land @ Rs.2.65 crores per acre. Petitioners challenge the action of 2nd respondent in not considering the offer/proposal given by the first petitioner to purchase the land @ Rs.2.65 crores per acre, even though the offer given by 4th respondent lapsed on failure to deposit the earnest money within the time granted as illegal, arbitrary and violative of principles of natural justice offending Article 14, 21 and 300-A of the Constitution of India.
4. On 01.02.2019, while adjourning the matter on a request made on behalf of respondents 1 to 3 for filing counter, and directing petitioners to take out fresh notice on 4th respondent, this Court issued interim directions directing respondents 2 and 3 not to confirm the sale in pursuance to the notice of sale of land published in the daily newspaper on 08.06.2018.
5. The AWHO and 4th respondent filed counter affidavits and also filed applications to vacate the interim stay granted by this Court on 01.02.2019. At this stage, writ petition is heard and disposed of by this order.
6. On behalf of respondents 2 to 4, preliminary objection on the maintainability of writ petition is raised.
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7. According to learned counsel for respondents 2 and 3, AWHO is a Society registered under the Societies Registration Act, 1860 and it is purely an independent private Society formed to cater to the needs of serving and retired Army personnel to enable them to own houses. It acquires funds predominantly and chiefly from Life Insurance Corporation of India, Nationalized/Commercial Banks, Hindustan Urban Development Corporation, Loan from Central Government, AGIF and Contributions made by the allottees towards the project development for which the individuals are registered. The subscription and charges of project completed would create a revolving fund. The Central Government has no role in establishment and running of the Society. Therefore, the Society is not amenable to writ jurisdiction. It is further contended that petitioner did not participate in the deliberations after the bids were received by AWHO and has given invalid offer by splitting the extent of land into two parts offering highest price to the land abutting the highway and less price to the rest of the land and the offer given by the first petitioner was also far less than the offer given by the 4th respondent. Belatedly, first petitioner sought to increase the offer price.
8. On the issue of maintainability of writ petition, learned counsel representing respondents 2 and 3 placed reliance on the judgment of Delhi High Court in Army Welfare Housing Organization Vs Adjutant General's Branch & Others (LPA No.867 of 2013).
9. Learned Senior Counsel appearing for 4th respondent submits that as stated by learned counsel appearing for respondents 2 and 3, the AWHO is a private Society and State has no control in whatsoever manner and what is under consideration is purely a private sale transaction. Therefore, the writ petition is not maintainable. It is a PNR,J W.P.No.95 of 2019 -6- frivolous litigation instituted by petitioner. By the time, the writ petition is filed, substantial amount was paid by 4th respondent and any further continuation of interim order would cause grave prejudice to the 4th respondent which cannot be remedied later.
10. On the issue of maintainability of writ petition, learned senior counsel appearing for 4th respondent placed reliance on Lt.Col.N.C.Rastogi Vs Union of India and others1, Shaheeda Begum Vs Principal, Army School, Secunderabad and another2, K.K.Saksena Vs International Commission on Irrigation and Drainage and others,3 and Joshi Technologies International INC Vs Union of India and Others4.
11. Learned counsel for the petitioners sought to contend that the Society is established to provide dwelling houses to the serving and retired military personnel and the Governing Body of the Society comprises top military officials. Thus, it is discharging public duty and is not a private society. Thus, the 3rd respondent is a State and amenable to writ jurisdiction. He would further submit that huge extent of land meant for development of layout and allotment of house plots to serving and retired military personnel was sought to be sold away for a paltry sum. It would impact the aspirations of the military personnel. When no transparent procedure was followed in parting with such huge extent of prime land, this Court in exercise of power of judicial review under Article 226 of the Constitution of India can entertain the writ petition and to consider the tenability of decision taken by the 2nd & 3rd respondents against public interest. 1 AIR 1986 Delhi 128 2 2005 (6) ALD 312 3 (2015) 4 Supreme Court Cases 670 4 (2015) 7 Supreme Court Cases 728 PNR,J W.P.No.95 of 2019 -7-
12. He would further submit that as per the paper notification and the correspondence entered into with the 4th respondent, the 4th respondent was required to pay 10% of the offer price by 03.10.2018, whereas he did not pay that money even though he sought extension within the extended time also, money was not paid. Therefore, his offer becomes illegal and the question of selling land to him does not arise. Since the 4th respondent failed to honor the commitment by paying the earnest amount within the time granted, petitioner offered higher amount and the offer given by him ought to have been accepted. He would submit that the AWHO stand to gain by accepting the offer given by the petitioners compared to the offer of the 4th respondent and not accepting the offer of first petitioner and accepting the offer of 4th respondent, even though he did not comply with the conditions stipulated by 2nd respondent, amounts to arbitrary exercise of power, against public interest. Therefore, the entire exercise should be declared as illegal.
13. The maintainability of writ petition against AWHO was considered by the Division Bench of Delhi High Court in Army Welfare's case (supra) and judgment was rendered on 19.11.2014. On elaborate consideration of the composition and functioning and on review of earlier decisions of the Delhi High Court concerning the same Organization, the Division Bench of the Delhi High Court held that AWHO is not a State within the meaning of Article 12 of the Constitution of India. In the said case the Division Bench considered whether AWHO is "Public Authority" as defined in Section 2(h) of the Right to Information Act, (for short, the Act). It was held that AWHO does not answer the description of State under Article 12 of the PNR,J W.P.No.95 of 2019 -8- Constitution of India is not a "Public Authority" and therefore, the said Act is not applicable. The same principle would apply in the instant case also.
14. An identical issue has come up for consideration before the learned Single Judge of this Court in Shaheeda Begum's case (supra). The Army School was not funded by the State or Central Governments and State or Central Governments do not exercise any financial control or have dominance over the said school. This Court therefore, held that it is not amenable to writ jurisdiction and therefore, the Writ petition is not maintainable.
15. In long line of precedent cases, the Hon'ble Supreme Court laid down parameters to hold the Organization/Society as an authority and therefore, State within the meaning of Article 12 of the Constitution of India and also on the scope of maintainability of writ petition under Article 226 of the Constitution of India in matters having no public law element.
16. It is settled principle of law that to make Authority/Society as State within the meaning of Article 12 of the Constitution of India, it must have the trappings of the State. Such as, the Society is entirely funded by the Government; Society enjoys monopoly status which is conferred on State; the State has deep and perversive control in functioning of the Society; the functions of Society have public importance and closely related to Government functions; the functions either to undertaken by a Department of State stood vested in the Society by establishing such Society by the State; and all major functionaries of the Society, as representatives of the State in their official capacity are part of the governing body of the Society, and de facto govern the affairs of the society in the said capacity.
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17. As held by the Delhi High Court in the above decision, none of these parameters are answered. In the case of AWHO, it is purely a private Society with no State control, except top army officials forming part of Board of Governors as ex-officio. There is no compulsion on the serving or retired military personnel to enroll as members of the Society and to take plots offered by the AWHO. No financial assistance was extended by the Central Government. The State Government has not allotted land free of cost or on a nominal price. A service voluntarily undertaken cannot be said to be a public duty. Therefore, the AWHO is not a State within the meaning of Article 12 of the Constitution of India. Further the land which was proposed for sale was acquired by AWHO within its own means and without any support from the State or Central Governments.
18. In long line of precedent decisions, the Hon'ble Supreme Court has gone to the extent of holding that even if the Organization/Society has trappings of the State within the meaning of Article 12 of the Constitution of India, if the grievance agitated in the writ petition has no public law element, but is purely a private civil dispute, the writ remedy is not the answer and the person has to be relegated to the common law remedy.
19. Having regard to the above analysis on the scope of maintainability of writ petition, the contentions of the petitioners are looked into. Petitioners contend that though the initial offer was less than the offer given by 4th respondent, 4th respondent failed to honor payment of non-refundable earnest money within the time granted, his bid ought to have been rejected and as the subsequent offer given by PNR,J W.P.No.95 of 2019
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the first petitioner is higher than the offer given by 4th respondent, the same ought to have been accepted.
20. To appreciate this contention, it is necessary to see the paper notification issued on 08.06.2018. The notification only requires offers/proposals to purchase the land mentioned in the notification. It does not prescribe any other conditions. In fact as a private Society, it has power to sell the land to any person even without issuing such notification. May be the Society thought it fit to give wide publicity to get better price for the land. Therefore, the advertisement was issued. Apparently, the offer given by the 4th respondent was higher as compared to all offers. Therefore, 4th respondent offer was accepted. It is not a normal tender process which requires fulfillment of tender conditions and compliance of strict requirements to participate in a tender to award contract. Petitioners cannot seek to import the parameters to award contracts by State or its instrumentalities in a matter concerning sale of land owned by AWHO, a private Society. Therefore, their contention that since the earnest money was not paid within the time granted, bid of the 4th respondent ought to have been rejected has no merit.
21. Further, as owner of the land it is the exclusive prerogative of the Society to determine price of the land and person to whom it wants to sell. Such decisions of a private society are not amenable to judicial review. As seen from the averments in the counter-affidavit filed on behalf of respondents 2 and 3, elaborate exercise was undertaken before offering to sell the land and after the bids were submitted, they were processed at the highest level of Society and based on the offer given by the 4th respondent, he was identified as the person to whom the land can be sold. Thus, there is no public law element involved in PNR,J W.P.No.95 of 2019
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this case. There is no public interest involved. It is purely a private affair of the Society in dealing with its land. Private law remedies are not enforceable through extra-ordinary jurisdiction under Article 226 of the Constitution of India. Therefore, even assuming that petitioner has a valid grievance, he must avail the civil law remedy. The law on this aspect is also well settled.
22. For the aforesaid reasons, the Writ Petition is dismissed. It is made clear that there is no expression of opinion on merits. The discussion herein above is made only to appreciate the contentions on maintainability of Writ Petition. Pending miscellaneous petitions shall stand closed.
__________________________ JUSTICE P.NAVEEN RAO Date: 02-04-2019 Rds/kkm PNR,J W.P.No.95 of 2019
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HONOURABLE SRI JUSTICE P.NAVEEN RAO WRIT PETITION No.95 OF 2019 DATE: 02.04.2019 rds/kkm