Karnataka High Court
H.N.Pruthivinarayan vs The Managing Director on 21 April, 2023
Author: M. Nagaprasanna
Bench: M. Nagaprasanna
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 21ST DAY OF APRIL, 2023
BEFORE
THE HON'BLE MR. JUSTICE M. NAGAPRASANNA
WRIT PETITION No.2940 OF 2023(GM-TEN)
BETWEEN:
H.N.PRUTHVINARAYAN
S/O H.G.NARAYANA
AGED ABOUT 52 YEARS
NO. 65/14, P.B.NO.32
B.M.ROAD,
HASSAN - 573 201.
... PETITIONER
(BY SMT. LAKSHMY IYENGAR, SENIOR ADVOCATE A/W.,
SRI VENKATARAMANA K. S, ADVOCATE)
AND:
1 . THE MANAGING DIRECTOR
K.S.R.T.C.,
CENTRAL OFFICE
SHANTHINAGARA
BENGALURU - 560 027.
2 . THE DIVISIONAL CONTROLLER
K.S.R.T.C.,
HASSAN DIVISION
HASSAN - 573 201.
... RESPONDENTS
(BY SRI P.D.SURANA, ADVOCATE FOR C/R1)
2
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND
227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASHING THE
IMPUGNED E-TENDER NOTIFICATION DATED 10/01/2023 IN
NO.KARASA.HAVI.SAM.VAA/1868/22-23 ISSUED BY R-2 VIDE
ANNEXURE-G.
THIS WRIT PETITION HAVING BEEN HEARD AND RESERVED
FOR ORDERS ON 19.04.2023, COMING ON FOR PRONOUNCEMENT
THIS DAY, THE COURT MADE THE FOLLOWING:-
ORDER
The petitioner is before this Court calling in question an e- tender notification dated 10.01.2023, issued by the second respondent - the Divisional Controller of the Hassan Division at Hassan ('hereinafter referred to as 'the Corporation' for short).
2. Heard Smt. Lakshmy Iyengar, learned senior counsel appearing for the petitioner and Sri P.D.Surana, learned counsel appearing for the caveator - respondent No.1.
3. Facts in brief, germane are as follows:
To consider the case of the petitioner as projected in the subject petition, it is germane to take a little walk in history. The petitioner is chosen as a lessee to maintain and develop commercial space of newly built Hassan Bus Stand including parking and 3 hoardings of advertisements for a period of 12 years on licence fee of Rs.95,00,000/- per year with an increase of 5% every year. The agreement between the two is termed as a concession agreement.
The agreement comes to be registered on 01-02-2011, to be in operation from 06-09-2010. In terms of the agreement, the respondent/Karnataka State Road Transportation Corporation ('the Corporation' for short) appears to have assured the petitioner to reduce the burden of huge licence fee, by taking up construction of new bus terminal from where all buses would ply in Hassan and the old bus terminal would be closed and used as a depot by the Corporation; 75% of bus trips would be at the minimum from the new bus terminal. The allegation against the Corporation is that, from the beginning of the contract till this day, the Corporation has never fulfilled the aforesaid assurances made in the contract and the old bus stand continues to be in operation. Therefore, the petitioner claims to have suffered huge losses, as buses were divided between old bus terminal and the new bus terminal.
Correspondences were made by the petitioner highlighting these problems and taking exception to the act of the Corporation in going back on its assurances.4
4. It is contended that from 2016, the Corporation goes on threatening the petitioner that it would terminate the contract prematurely and declare the petitioner to be a defaulter on the ground that he has not been paying rents at regular intervals or rents for every quarter as per the contract. Dispute between the two arose with regard to payment of rent amounts and a final notice dated 15-11-2016 was issued to the petitioner alleging that if the dues were not paid, legal action would be taken against him. The petitioner replied to the said notice on 24.11.2016, seeking reference of the matter to the Arbitrator to sort out the issue with regard to arrears of rent as per covenants of the concession contract, since the contract recognized resolution of the dispute by way of arbitration. It appears that the Corporation refused to refer the matter to the Arbitrator on the ground that licence fee and other fees to the Corporation would not come within the purview of any dispute that could be arbitrated.
5. The petitioner later claims to have paid Rs.78,76,404/- on 19-12-2016, under protest. Even then, the averment in the petition is that, the Corporation did not fulfill its assurances that it 5 had made and went on taking money in the garb of licence fee without taking care of the fact that the buses should ply only from the new bus terminal and it is only then, the petitioner would be in a position to pay huge licence fee. Notices being issued from time to time by the Corporation threatening that if arrears would not be paid within 30 days of the notice, the contract would be terminated and further action would be taken against the petitioner.
6. All these grievances then reached this Court in Writ Petition No.30258 of 2018. This Court grants an interim order of stay of the final notice. The petition comes to be disposed of on 17-09-2018, noticing the fact that the contract did recognize resolution of the dispute by way of arbitration and the fact that Civil Miscellaneous petition in C.M.P.No.233 of 2018 had been filed before this Court, seeking appointment of Arbitrator and directed the Corporation not to take precipitative or coercive action against the petitioner. C.M.P.No.233 of 2018, comes up before this Court for consideration on 03-11-2020. This Court noticing the fact that the petitioner had not exhausted pre-arbitration mechanism as contained in the 6 contract directed the parties to sit for a pre-arbitration mediation and thereafter, approach this Court.
7. After disposal of the petition, the petitioner caused a legal notice upon the respondents/Corporation, pointing out one Sri K.S. Srinidhi to be the representative to negotiate with the Corporation. Negotiations went on, which ultimately resulted in failure. In the interregnum, another final notice comes to be issued on 24.04.2021, which the petitioner had to challenge in Writ Petition No.8992 of 2021. This Court again disposed of the said writ petition on 28.05.2021, directing the respondents to consider the representations of the petitioner and reserved liberty to the petitioner to approach this Court, if aggrieved on the orders to be passed by the Corporation on his representations or avail such other remedy as is permissible in law.
8. The Corporation issued a final notice on 01.08.2022, seeking payment of Rs.1,06,26,687/-, on failure of which, the agreement between the petitioner and the respondents would be cancelled, apart from declaring the petitioner to be a defaulter. This action was called in question before this Court in 7 W.P.No.16705/2022. This Court in terms of its order dated 30.11.2022, allowed the writ petition in-part on certain reasons. I deem it appropriate to quote the relevant paragraphs, which are as follows:
"The petitioner sought the issue to be arbitrated. This was not acceded to by the Corporation contending that, this is not an issue that can be a subject matter of arbitration. Correspondences between the two galore and the issue reached this Court in two proceedings - one challenging the final notice issued by the Corporation against the petitioner on 15-06-2018, in Writ Petition No.30258 of 2018 and the other in C.M.P.No.233 of 2018. A co-ordinate Bench of this Court hearing Writ Petition No. 30258 of 2018, noticing the fact that the issue could be arbitrated, disposed of the petition on 17- 09-2018, by the following order:
"3. I have perused Clause 12.3.2.(i) of the Concession Agreement dated 06/09/2010, a copy of which is produced as ANNEXURE A to this writ petition which reads as under;
"(i) 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 shall be by a jointly appointed single arbitrator. However, if both the Parties are unable to agree upon appointment of a single arbitrator within a period of 14 days of notice for arbitration ("Arbitration Notice") by either party, each Party shall appoint one arbitrator each within a period 8 of 21 days of Arbitration Notice, and the two selected arbitrators shall appoint the third arbitrator within a period of 30 days of Arbitration Notice, who shall act as chairperson of the arbitral tribunal."
4. It is further not in dispute that the petitioner has invoked the aforesaid Arbitration Clause and that CMP No.233/2018 for appointment of an Arbitrator and the same is pending for adjudication. In the circumstances, the writ petition is not entertained and the same is dismissed reserving liberty to the petitioner to invoke Clause 12.3.2(i) for appointment of an Arbitrator and Section 9 of Arbitration and Conciliation Act, 1996 as amended by 2015 amendment insofar as interim or protective measures/orders are concerned.
5. In view of the dismissal of the writ petition, I.A.2/2018 is allowed and the interim order is recalled.
6. At this juncture, learned counsel for the petitioner seeks protective orders from this Court. In reply, learned counsel for Respondent No.1 submits that so long as one more notice is not issued, no precipitative or coercive action could be taken against the petitioner. This submission of learned counsel for R- 1 is placed on record.
7. Without prejudice to the rights and contentions of the respective parties, the petitioner is at liberty to tender rents payable to the respondents.
(Emphasis supplied) This Court notices arbitration clause, records that Civil Miscellaneous Petition in CMP No.233 of 2018 is pending consideration seeking appointment of an Arbitrator and dismisses the petition, but however, recorded the undertaking of the Corporation that it would not take any coercive or precipitative action. What could be gathered from the order that is passed and the undertaking given by the Corporation is 9 that, the order records, there is a dispute between the two and the dispute is arbitrable; CMP seeking appointment of the Arbitrator was pending and the Corporation undertaking that no precipitative action would be taken, which would mean that till the dispute is arbitrated, no coercive action would be taken.
15. The Court hearing Civil Miscellaneous Petition in C.M.P. No.233 of 2018, disposes of the petition on 03-11- 2020, by recording that pre-arbitration mechanism as contained in the agreement itself had not been adopted for resolution of the dispute generated between the parties and ordered as follows:
"3. A perusal of the Concession Agreement at Annexure-A, in particular Clause 12.3 relating to dispute resolution procedure will indicate that the present petition without exhausting or taking steps of exhaust, the pre-arbitration mechanism/procedure prescribed in Clause 12.3.1 of the said Agreement, the petition is premature and is liable to be dismissed.
4. Under these circumstances, reserving liberty in favour of the petitioner to exhaust the aforesaid pre-arbitration mechanism contained in Clause 12.3.1 stated supra and thereafter approach this Court, the petition is hereby disposed of."
(Emphasis supplied) This Court recorded that without exhausting pre- arbitration mechanism procedure, the petition would be premature and reserved liberty to approach this Court after the petitioner exhausts the said mechanism. Therefore, this Court in the writ petition records arbitration clause and in the CMP, directs the petitioner to approach the respondent / Corporation for a pre-arbitration mediation.
16. Later, the petitioner causes a notice upon the Corporation, appoints representative and seeks amicable 10 settlement. The allegations against each other galore as it is the allegation of the learned counsel for the Corporation that the petitioner never came out with proper terms for mediation and the learned senior counsel for the petitioner would contend that Officers of the Corporation were not co-operative for mediation and went on threatening that they would terminate the contract. During the pendency of all these, the Corporation eventually issues another notice for which the petitioner had to again knock the doors of this Court challenging the final notice dated 24.04.2021, in W.P.No.8992/2021. This Court directed the Corporation to consider the reply of the petitioner and appropriate orders be passed as is available in law. The order passed by this Court in Writ Petition No.8992 of 2021 dated 28-05-2021, reads as follows:
"2. The petitioner claims to be a concessnaire and under the Concession Agreement he has been permitted to construct and operate the Hassan Bus Terminal. That now the respondent has issued a notice for terminating the contract and that the petitioner has also effected a comprehensive reply and that apart, he has also brought out certain additional facts by way of representations produced as per Annexures 'S' and 'V'. Despite the same respondents are attempting to proceed further in the matter.
3. It is not in dispute that under the terms of the contract the respondent is entitled to call upon the petitioner to perform his part of the contract. That apart the petitioner has also endeavored to reply to the notice. That being the obtaining facts, this Court is of the opinion that the instant writ petition is a premature attempt.
4. Be that as it may, this Court is of the considered opinion that this writ petition could be disposed of by directing the petitioner to await the orders that may be passed and the respondents are also directed to consider the representations 'S' and 'V' while considering the reply effected by the petitioner. Writ petition stands disposed of accordingly.11
5. In the event the petitioner is aggrieved by the order that may be passed pursuant to the reply effected by the petitioner it is open to the petitioner to approach this Court or avail such other remedy as is permissible under law. The writ petition stands disposed off in the above terms.
There shall be no order as to costs."
(Emphasis in original) It appears that later, amounts were paid by the petitioner upto 27-07-2022, as per the accounts statement produced by him. This the learned counsel for the respondents/Corporation would contend that it is not the amount that is to be paid. The learned senior counsel for the petitioner would contend that every pie upto date has been paid. Therefore, the dispute with regard to payment is still at large between the two. During the pendency of the resolution of the dispute, another final notice comes to be issued on 01- 08-2022. It is this that forms the subject matter of the present petition.
17. In the light of what is observed hereinabove, there exists a dispute with regard to payment of arrears of rent or license fee as the case would be, and the dispute arises out of the conditions or covenants of the contract. The contract provides for resolution of the dispute by way of arbitration in terms of Clause 12.3, which deals with dispute resolution mechanism. Therefore, the mechanism in terms of the agreement is in place. The mechanism is by way of arbitration. This Court had directed pre-arbitration mechanism to be exhausted. Pre-arbitration effort has apparently failed for manifold reasons not to be attributable either to the petitioner or the Corporation, but the talks have failed. Once talks fail, it would be case that it has to be arbitrated as the finding in the writ petition earlier was that the issue was arbitrable and the finding in the C.M.P is pre-arbitration mechanism should be exhausted, would all lead to unmistakable conclusion that, the issue is required to be arbitrated between the parties. 12
18. The learned counsel for the respondents/Corporation would submit that another C.M.P. seeking appointment of Arbitrator is already filed by the petitioner. Therefore, it is for the Court to consider the same and appoint an Arbitrator, if any.
19. The issue before this Court is, whether the final notice that is issued, in the teeth of existence of arbitration clause and the arbitration being sought, is to be answered.
20. xxxxxxxx In the light of facts as narrated hereinabove and judgments of the Apex Court, what would unmistakably emerge is, the dispute between the parties has to be resolved by way of arbitration in terms of the agreement itself. Therefore, the Corporation issuing final notice without at the outset getting the issue arbitrated would frustrate the contract. Therefore, the said final notice cannot be acted upon till the issue gets arbitrated, which would be subject to result of the arbitration if any, instituted between the parties.
21. Till the arbitration proceedings are concluded, as was undertaken by the Corporation before this Court in Writ Petition No.30258 of 2018, the Corporation shall not take any precipitative or coercive action against the petitioner. This would not mean or absolve the petitioner from paying regular rent/lease amount in terms of the contract.
22. For the aforesaid reasons, the following:
ORDER
(i) The Writ Petition is allowed in part.
(ii) The final notice dated 01.08.2022 and all further proceedings taken thereto, stands quashed.
(iii) The parties are free to arbitrate the dispute between them in terms of the agreement. Till such time, the Corporation shall not precipitate the matter.
(iv) The petitioner shall pay and continue to pay the lease amount in terms of the agreement till the 13 dispute between the parties is resolved, which would be subject to conclusion of arbitration proceedings."
The reason rendered for allowing the said petition was that the Corporation had undertaken before the Court that they would not precipitate the matter till one more notice is issued. The next notice issued after the said order formed the challenge in the afore- quoted writ petition. Therefore, this Court passed the aforesaid order. This order was called in question by the Corporation before the Division Bench in W.A.No.27/2023, which comes to be dismissed by an order of the Division Bench dated 14.02.2023. The Division Bench affirms the order on the following reasons:
"9. From the perusal of clauses 12.3.1 and 12.3.2, it is clear that there is an arbitration clause in respect of any controversy arising among the parties in connection with or under the agreement and the parties shall settle their grievance through an Arbitrator. The respondent aggrieved by the final notice dated 15.06.2018 filed a writ petition in W.P No.30258/2018. The learned Single Judge, vide order dated 17.09.2018 dismissed the writ petition on the ground that the respondent had invoked arbitration clause by filing a petition in CMP No.233/2018 for appointment of an arbitrator and the same is pending for adjudication. The learned Single Judge, however, reserved liberty to the respondent to invoke clause 12.3.2(i), for appointment of an Arbitrator. In CMP No.233/2018 filed by the respondent the learned Single Judge, vide order dated 03.11.2020 it was observed perusal of clause 12.3 of the Concession Agreement relating to dispute resolution procedure would indicate that the 14 petition was filed without exhausting or taking steps of exhaust, the pre-arbitration mechanism/procedure prescribed in Clause 12.3.1 of the Concession Agreement. The learned Single Judge held that the petition was premature and dismissed the petition with liberty in favour of the respondent to exhaust the pre-arbitration mechanism contending in Clause 12.3.1 and thereafter approach this Court.
10. Pursuant to the disposal of CMP, the respondent issued a notice dated 04.12.2020 calling upon the appellants to resolve the dispute as per clause 12.3.1 of the Concession Agreement. The appellants submitted a reply on 12.01.2021 contending that as per the Concession Agreement, a meeting was scheduled to be held on 22.01.2021 in the afternoon at 15 hours in regard to the amicable settlement in the office of the representative of the Corporation and requested the representative of the respondent to be present along with the documents i.e. ID card, address proof and documents pertaining to the said commercial space.
11. The appellants issued a notice on 19.03.2021 calling upon the respondent to pay the arrears of licence fee failing which suitable action would be taken to terminate the Concession Agreement and to recover the loss caused to the Corporation. The respondent replied to the said notice by the letter dated 05.04.2021 and contended that the respondent was ready to invoke Arbitration. The appellants again issued the final notice dated 24.04.2021 alleging clear violation of the Concession Agreement and called upon the respondent to pay the lience fee failing which, the Concession Agreement will be terminated. The respondent submitted a reply to the said demand notice on 27.04.2021. One thing is clear from the Concession Agreement that if any dispute arises between the parties in regard to the terms of the contract, the parties had to resolve the dispute through Arbitration. Though pursuant to the directions issued in CMP No.233/2018, the parties were relegated for pre-arbitration mechanism, the pre-arbitration mechanism was closed. When the pre- arbitration mechanism was closed, as per clause 12.3.1 of the agreement, the parties have to approach the Arbitrator. The appellants without exhausting arbitration clause, issued a demand notice calling upon the respondent to deposit arrears 15 of licence fee. The said notice is challenged by respondent No.1 in writ petition.
12. The learned Single Judge considering the orders passed by this Court in the earlier rounds of litigation was justified in directing the parties to settle their dispute. The parties are free to arbitrate the dispute between them in terms of the agreement. Further, the learned Single Judge directed the respondent to pay and continue to pay the lease amount in terms of the grant till the dispute between the parties is resolved which would be subject to conclusion of arbitration proceeding.
13. The learned counsel for the appellants submits that the respondent has not paid the licence fee and the respondent is in arrears. By virtue of an impugned order, the appellants are not in a position to take steps for recovery of alleged arrears of licence fee. Though the learned Single Judge had directed the respondent to pay and continue to pay the lease amount in terms of the agreement. If the respondent fails to pay the rent or continue to pay licence fee in terms of the agreement, the appellants had got every right to execute the order passed by the learned Single Judge in the appropriate proceeding.
14. The learned counsel for the appellants has placed reliance on the judgment of the Hon'ble Apex Court which is not in dispute in regard to the proposition laid down in the aforesaid judgment. The said judgments are not applicable to the case in hand. The learned Senior Counsel for the respondent submits that the respondent is paying the licence fee and there is no arrears of licence fee. Whether there is arrears of licence fee or not is the matter to be adjudicated by the Arbitrator.
15. The Hon'ble Apex Court in the case of Visa International (supra) has held in paragraph 36 as under:
"It was contended that the pre-condition for amicable settlement of the dispute between the parties has not been exhausted and therefore the application seeking appointment of arbitrator is premature. From the correspondence exchanged 16 between the parties at pages 54-77 of the Paper- book, it is clear that there was no scope for amicable settlement, for both the parties have taken rigid stand making allegations against each other. In this regard a reference may be made to the letter dated 15th September, 2006 from the respondent herein in which it is inter-alia stated "......since February, 2005 after the execution of the agreements, various meetings/discussions have taken place between both the parties for furtherance of the objective and purpose with which the agreement and MOU was signed between parties. Several correspondences have been made by CRL to VISA to help and support its endeavour for achieving the goal for which the above mentioned agreements were executed." In the same letter it is alleged that in spite of repeated requests the petitioner has not provided any Funding Schedules for their portion of equity along with supporting documents to help in convincing OMC of financial capabilities of the parties and ultimately to obtain financial closure of the project. The exchange of letters between the parties undoubtedly discloses that attempts were made for an amicable settlement but without any result leaving no option but to invoke arbitration clause."
Paragraph 40 in the said judgment reads as under:
"It is amply clear from the facts as pleaded and as well as from the exchange of correspondence between the parties that there has not been any satisfaction recorded by the parties with respect to their claims. There has been no mutual satisfaction arrived at between the parties as regards the dispute in hand. The claims are obviously not barred by any limitation. It is thus clear that there is a live issue subsisting between the parties requiring its resolution."17
16. From the perusal of the records, it is clear that from the facts as pleaded as well as from the exchange of correspondence between the appellants and the respondent, there has not been any satisfaction recorded by the parties with respect to their claims. There has been no mutual satisfaction arrived at between the parties as regards the dispute in hand. It is thus, clear that there is a live issue subsisting between the parties requiring its resolution.
17. In view of the above discussions, we do not find any merit in the appeal. Accordingly, we proceed to pass the following ORDER The writ appeal is dismissed.
In view of disposal of the writ appeal, the pending interlocutory application does not survive and stands disposed of."
In the interregnum i.e., after the order of this Court as afore- quoted and before the judgment could be passed by the Division Bench, the Corporation issued a e-tender notification on 10.01.2023 and challenging the e-tender notification, the petitioner preferred the subject petition on 03.02.2023. The matter comes up before the Court on 09.02.2023. This Court passes the following order:
"These very parties were before this Court in W.P.No.16705/2022, which came to be disposed by an order dated 30.11.2022, by directing as follows:18
ORDER i. The Writ Petition is allowed in part. ii. The final notice dated 01.08.2022 and all further proceedings taken thereto, stands quashed. iii. The parties are free to arbitrate the dispute between them in terms of the agreement. Till such time, the Corporation shall not precipitate the matter. iv. The petitioner shall pay and continue to pay the lease amount in terms of the agreement till the dispute between the parties is resolved, which would be subject to conclusion of arbitration proceedings.
Learned counsel appearing for caveator/respondent No.1, Sri. P.D. Surana would submit that a Writ Appeal has been preferred calling in question the order passed this Court supra and is listed on 13.02.2023.
In the interregnum and after the order that was passed by this Court, the impugned notice inviting tender is issued by the respondents-KSRTC. Therefore, in the light of the order already in favour of the petitioner and the Writ Appeal pending before the Division Bench, I deem it appropriate to protect the petitioner subject to further orders that would be passed by the Division Bench in W.A.No.27/2023.
At this juncture, learned counsel, Sri. P.D. Surana would submit that the term of the petitioner would expire on 31.03.2023 and therefore, the Tender Notification is issued.
Learned counsel appearing for the petitioner would submit that the petitioner has sought extension of his contract in terms of Clause 2.2.2 of the contract between them.
Therefore, both the parties would be bound by whatever order that would be passed by the Division Bench.
Till such time, not to precipitate the issue qua only the contract with the petitioner.19
List this matter on 15.02.2023."
(Emphasis supplied) On the said date, it was submitted that the aforesaid W.A.No.27/2023 is directed to be listed on 13.02.2023 before the Division Bench. This Court observed that both the parties would be bound by whatever order that would be passed by the Division Bench. Till such time, it was directed that the respondents would not precipitate the matter. Later, the matter came up before the Court on 15.02.2023, by then, the writ appeal filed by the Corporation had been dismissed as afore-extracted. This Court on 15.02.2023 passed the following order:
"This petition is an offshoot of an order passed in W.P.No.16705/2022 which came to be disposed of by an order dated 30.11.2022. The respondents-KSRTC had thrusted the order passed by this Court before the Division Bench in W.A.No.27/2023.
The learned counsel for the parties would submit that W.A.No.27/2023 has been disposed in terms of an order passed by the Division Bench on 14.02.2023. Therefore, the findings that are rendered have, for the present, become final.
Learned counsel Sri.P.D.Surana submits that he needs two weeks' time to file statement of objections.
Therefore, I deem it appropriate to grant two weeks' time.20
The respondents-KSRTC shall not precipitate the matter qua the petitioner in any manner, till the next date of hearing."
(Emphasis supplied) The order passed by the Division Bench in W.A.No.27/2023 was called in question before the Apex Court by the Corporation in SLP (Civil) Dairy No.9929/2023. The Apex Court stays the order passed by this Court as affirmed by the Division Bench on 20.03.2023, observing as follows:
"Permission to file petition granted.
Learned counsel for the petitioners has handed over a copy of the application enclosing the reasoning of the High Court in support of the impugned order. This Court has considered the same.
Issue notice, returnable in four weeks.
The operation of the judgment and order of the learned single judge dated 30.11.2022 in W.P. No. 16705/2022 is hereby stayed till the next date of hearing."
(Emphasis supplied) In the interregnum, the Corporation had filed an application seeking modification of the interim order and statement of objections. The Corporation chose not to move the matter on the application, but challenged the order dated 15.02.2023, an interim order, before the Apex Court in SLP (Civil) Diary No.12553/2023. The Apex Court on 29.03.2023, passed the following order: 21
"I.A. No. 63162/2023 is granted.
Issue notice, returnable in two weeks; to be taken with SLP (C) D. No. 9929 of 2023 on 21.04.2023.
It is open to the petitioners to proceed with a fresh tender but not pass any final order.
List present petition along with SLP (C) D. No. 9929 of 2023.
In the meanwhile, the High Court shall dispose of the [W.P.(C) No. 2940 of 2023] pending before it as early as is expedient preferably before the date of hearing of the petition pending on the file of this Court [SLP (C) D. No. 9929/2023] which is 21.04.2023."
(Emphasis supplied) It is therefore, the matter is taken up for its final disposal.
9. The learned senior counsel appearing for the petitioner would contend that the issuance of a fresh tender notification in the teeth of the W.P.No.16705/2022 being allowed and the Division Bench also confirming the same, and further indicating that any dispute between the parties including the dispute with regard to payment of rent will have to be resolved before the Arbitrator. In the teeth of the aforesaid orders, the Corporation could not have issued a fresh e-tender notification. The learned senior counsel takes this Court through the concession agreement with particular reference to 2.2.2 and 2.2.4 to contend that the petitioner is entitled to an extension of lease and the Corporation has 22 deliberately issued a e-tender notification fragmenting the building, which was in its entirety given to the petitioner earlier.
10. On the other hand, Sri P.D.Surana, learned counsel for respondent No.1 - Corporation would seek to refute the submissions to contend that there is no right for the petitioner to claim any extension and the right on which the petitioner seeks to lay a claim is the order passed in W.P.No.16705/2022, which is stayed by the Hon'ble Apex Court. In the light of the stay order, the petitioner cannot claim any right in terms of the agreement. He would contend that the Apex Court has permitted to go ahead with the e-tender and not finalise the same and therefore, no right of the petitioner is taken away. Though he has quoted five judgments, he would restrict his reliance upon the judgments in the cases of UNION OF INDIA AND OTHERS Vs. M/s.Puna Hinda reported in AIR 2021 SC 4187, BHARTI AIRTEL LIMITED VS. UNION OF INDIA AND CONNECTED MATTERS reported in (2015) 12 SCC 1 and INDIAN OIL CORPORATION LIMITED VS. AMRITSAR GAS SERVICE AND OTHERS reported in (1991) 1 SCC 533.
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11. In reply, learned senior counsel appearing for the petitioner would refute to contend that in the light of the order passed by this Court in W.P.No.16705/2022 and when the matter was pending before the Division Bench, the respondents - Corporation could not have issued any tender frustrating the order passed by this Court. She would now contend that since the matter is pending before the Hon'ble Apex Court and therefore, they would seek appropriate orders at the hands of the Apex Court.
12. I have given my anxious consideration to the submissions made by the learned senior counsel appearing for the petitioner and the learned counsel for respondent No.1 - Corporation and have perused the material on record.
13. All the afore-narrated facts are a matter of record. The only issue that falls for consider is, whether the petitioner is entitled to call in question an e-tender notification in the facts of the case.
14. In the light of what is afore-narrated, there cannot be any doubt that the parties are bound by the terms of the contract, from 24 the inception, when the petitioner was chosen to be a lessee. The contract also indicates that the concession agreement can be extended upon occurrence of a force majeure event. The extension is now sought on the ground that two years have gone by, without any business on account of the onset of COVID-19. Learned senior counsel appearing for the petitioner has placed reliance upon several office memoranda issued by the Government of India from time to time after the onset of COVID-19 to buttress her submission for extension on account of a force majeure event i.e., COVID-19.
15. It is also a matter of record that the Corporation themselves earlier had granted such extension on 08.04.2011. But that was a concession that was offered by the Corporation. If the Corporation wanted to offer the said concession all over again, it would have been a circumstance altogether a different. But the issue is that, the Corporation had called for an e-tender again. Therefore, it would clearly mean that they are not wanting to grant any extension to the petitioner. If the Corporation is not willing to extend, this Court would not direct such extension at this juncture, as the entire right of the petitioner or the Corporation qua the 25 contract is pending before the Apex Court SLP (Civil) Diary No.9929/2023. Therefore, any relief that would be granted on the prayer of the petitioner, will only be dependent upon the interpretation of the contract qua the rights of the parties under the contract. The issue in its entirety is at large before the Apex Court in SLP (Civil) Diary No.9929/2023. Since the Apex Court has stayed the order passed by this Court, as affirmed by the Division Bench, no relief can be granted to the petitioner as is sought. It was always open for the petitioner to participate in the said tender. The petitioner has not chosen to participate in the said tender.
16. The learned senior counsel would submit that there was an order in favour of the petitioner and therefore, the petitioner chose to challenge the said action of e-tender and has not participated in it. In the aforesaid circumstances, since the entire gamut of issues are before the Apex Court in the said SLP (Civil) Diary No.12553/2023, no order in favour of the petitioner can now be passed.
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17. The Apex Court in SLP (Civil) Diary No.12553/2023 has already permitted the Corporation to proceed with the fresh tender and not pass any final order. This would again be a circumstance to deny the relief to the petitioner as the petitioner will have to seek appropriate orders in the pending SLP (Civil) Diary No.12553/2023, if the petitioner is wanting any relief qua the contract, either in SLP (Civil) Diary No.9929/2023 or in 12553/2023, both of which are pending consideration before the Hon'ble Apex Court.
18. The submission that the petitioner had already an order in his favour and therefore, he has not participated, at this juncture is unacceptable. It is always open for the petitioner to seek appropriate relief at the hands of the Hon'ble Apex Court in either of the petitions pending.
19. Judgments relied on both by the petitioner and the respondents need not bear consideration at this juncture in the light of what is narrated hereinabove.
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20. With the aforesaid observations, the writ petition stands disposed.
Sd/-
JUDGE nvj CT:SS