Madras High Court
C. Jayadevan And Ors. vs The Corporation Of Coimbatore Rep. By ... on 22 August, 2003
Author: P. Sathasivam
Bench: P. Sathasivam
ORDER P. Sathasivam, J.
1. By consent of all the parties, the main writ petitions themselves are taken up for final disposal.
2. The petitioners numbering 23 have filed WP.33551 of 2002, praying to issue a writ of mandamus forbearing the Commissioner, Corporation of Coimbatore from proceeding with the tender notice dated 05.08.2002, in respect of 23 shops in the basement of Thiru-Vi- Kalyanasundaranar Market, Coimbatore 9, without allotting the said shops to the petitioners at the Public Works Department's rate.
3. The very same petitioners, except two (Sl. No. 10 and 11 in the earlier writ petition) have filed WP. No. 36280 of 2002, seeking to issue a writ of declaration declaring G.O.Ms. No. 208 dated 17.06.2002 of the Government of Tamil Nadu as illegal and unconstitutional as well as for the consequential direction to the Commissioner, Corporation of Coimbatore to allot shops to them at the newly constructed premises, previously called as Thiru- Vi-Kalyanasundaranar Market, Coimbatore at the rates determined by the Public Works Department.
4. The case of the petitioners in W.P. No. 33551 of 2002 is briefly stated hereunder:
The petitioners are all small vendors i.e., trading in vegetable, pottery, barber shop, general provision shop, tiffen stall, meat, fish etc., under valid license issued by the Coimbatore Corporation in Thiru-Vi-Kalyanasundaranar Market. Until 1997, they were occupying the shops allotted to them by the Corporation. Some of them are carrying on trade from 1950 onwards. The respondent Corporation, in 1997, while demolishing the existing Thiru-Ve-Kalyanasundaranar Market, temporarily allotted place to them at the Government Primary School, Kattur, Coimbatore, when the school was closed due to dwindling number of students. An assurance was given to them stating that they would be allotted basement of the newly constructed building at the Public Works Department's rate. They have been paying rent regularly. They are not an unauthorised encroachers. Now, the Corporation has constructed 63 shops and learnt that they had ear-marked 23 shops to the petitioners at the basement of the new building. On hearing a news item in the month of January, 2002, regarding allotment of shops in Thiru- Vi-Kalyanasundaranar Market, they sent a representation to the Commissioner, requesting them not to allot shops through tender and they should be given preference. In spite of their request, the Commissioner, invited tenders by exhibiting the tender notice dated 05.08.2002 at the Corporation Notice Board for the allotment of shops at the newly constructed building at Thiru-Vi-Kalyanasundaranar Market, where the petitioners were doing business under valid license. Since the action of the first respondent is highly arbitrary and unreasonable and left with no other efficacious or alternative remedy, the petitioners have filed WP. No. 33551 of 2002.
5. In the other writ petition, namely W.P. No. 36280 of 2002, it is the case of the petitioners that the rejection of their request to give preference in allotment of shops without resorting to open tender is unreasonable and violative of Constitution of India. The order of the Government is also contrary and opposed to the decision of the Supreme Court in the case of Labha Ram and Sons and others v. State of Punjab .
6. The Commissioner of Coimbatore City Municipal Corporation has filed a separate counter affidavit, wherein it is stated that Thiru-Vi-Kalyanasundarar Market was in a dilapidated condition without any proper facilities and the said market is more than 50 years old. Since the shops were in bad condition, they were demolished and in there place 63 new shops were constructed. The Commissioner has admitted that during the said construction the persons who were doing business in the old market were asked to use the play ground of the Corporation Elementary School in Mariyappa Konar Street. The new shops have been constructed at a cost of Rs. 57.21 lakhs. Taking sympathetic view on the petitioners, Taxation and Finance Committee of the Corporation passed a Resolution on 25.07.2002 in Resolution No. 181, resolving to grant license to the old licensees at the rate fixed by the Corporation and in the event of their failure, the shops shall be auctioned. The proposal of the Corporation was rejected by the Government, while passing the impugned orders under Section 49 the Coimbatore City Municipal Corporation Act by G.O.Ms. No. 208 dated 17.06.2002. In view of the financial difficulties and the order of the Government, the Corporation issued a notification in dailies calling for successful bidders. Though wide publicity was given, only seven shops were bid by some persons.
7. Though the second respondent - Government was duly served notice in the writ petitions, they have not chosen to file a counter affidavit disputing various averments.
8. Heard the learned counsel for the petitioners as well as for the respondents.
9. It is seen from the information furnished that all the petitioners are small vendors trading under valid license issued by the Coimbatore Corporation in a market called Thiru-Vi-Kalyanasundaranar Market, and are trading vegetable, pottery, barber shop, provision shop, tiffen stall, meat, fish etc., It is also their case that some of them were occupying those shops allotted by the Corporation and carrying on trade from 1950 onwards. It is further seen that Thiru- Vi-Kalyanasundaranar Market was in a dilapidated condition, since it is more than 50 years old. According to the Commissioner, Corporation of Coimbatore, the shops therein were in a very bad condition and the same were demolished, 63 new shops were constructed in there place. Even according to the Commissioner, during the period in which the construction was being carried out, the persons who were doing business in the unused play ground of Corporation School in Mariyappa Konar Street.
10. The petitioners have claimed that when they were asked to vacate the old building, they were assured that shops would be allotted to them at the basement of the newly constructed building, at the rate fixed by the Public Works Department. It is also seen that the Corporation has constructed 63 new shops. Since the petitioners were in occupation of the shops prior to demolition, on their representation, taking sympathetic view, Taxation and Financial Committee of the Corporation passed a Resolution No. 181 dated 25.07.2001, to allot shops on a preferential basis to them on the rates fixed as per the Rules. In other words, it is clear that Council of Corporation decided to give some of the new shops to the erstwhile licensees as per the Rules. The same was ratified by a resolution of the Corporation. When the same was sent to the Government for their approval, by letter dated 11.01.2002, a show cause notice was issued, calling upon the Corporation to show cause as to why the said Resolution should not be quashed as per the powers under Section 49 Coimbatore City Municipal Corporation Act. According to the Commissioner, suitable reply was sent setting out the stand of the Corporation in view of the poor circumstances of the old licensees. The Corporation, thereafter, resolved to issue the concession of exempting solvency certificate or the payment of deposits for the old licensees while holding the auction. The said proposal of the Corporation was rejected by the Government while passing orders under Section 49 of the Act by G.O.Ms. No. 208 dated 17.06.2002, which is under challenge in W.P. No. 36280 of 2002. Though it is stated that the said order was passed by the Government as a policy decision and in view of the financial difficulties of the local bodies as well as to augment revenue, the fact remains that the Corporation has considered the grievance of the petitioners and some of them were doing business from 1950 in the old shops and they were shifted to a play ground of a Government School on the assurance that they will be given new shops after construction.
11. I have already referred to the fact that the Corporation is acceptable to the claim of the petitioners. In G.O.Ms. No. 208 dated 17.06.2002, except saying that the Government considered the decision of the Corporation, has not assigned any reason for not approving the request of the Corporation. No doubt, it is stated that in order to augment revenue for Corporation, the Government directed the Corporation to conduct public auction even in respect of newly constructed shops in Thiru-Vi-Kalyanasundaranar Market. In the earlier part of my order, I have already referred to the nature of trading / business being carried out by the petitioners, their period of occupation, dilapidated condition of the old market and providing temporary site, namely play ground of High School for continuing their business / trade. In this regard, Ms. Vaigai, learned counsel for the petitioners, by pointing out the decision of the Supreme Court in the case of Labha Ram and Sons and others v. State of Punjab would contend that though the public auction was to earn revenue may be a laudable object for the State, that could not be the sole or even main purpose. In the case before the Supreme Court in similar circumstance, a contention was advanced that the purpose of public auction was to earn revenue and there was no bar on the existing traders to compete with the new comers and that a sufficient number of plots / shops were available to satisfy all such traders, if they choose to bid in the open auction. Rejecting the said contention, the Supreme Court held that, "14. The above line of argument of the State seems to us rather specious Land is acquired under the provisions of the land acquisition laws for establishing new mandi townships. Land so acquired is developed, plots are carved out and shops and flats are built thereon. Plots as such may be disposed of or shops and other construction thereon cane be made for use of the trading. Hence the land for establishment of new mandi is not to generate revenue for the State. It may be a laudable object for the State to earn revenue in the process but that could not be the sole or even the main purpose of acquiring land. New mandis are established because of increase in business transactions and congestion in the old mandis and for other such objects. "
It is also relevant to refer the suggestion made by their Lordships in para 16, which reads as under.
"16. We do not suggest that the Government should give preference to the erstwhile dealers by providing free allotment of buildings or plots nor to fix a rate which is below the reserved price. It is open to the Government to fix up any rate above the reserved price for such licensed dealers, of course such fixation should not be at unreasonable rates."
It is clear from the above decision, first of all earning of revenue is not an objective of the Government while constructing new shops. Though the Corporation is in need of more money and is expected to augment revenue, at the same time, as observed by the Supreme Court, the petitioners who were trading business in the old market quiet number of years (some of them from 1950 onwards) cannot be ignored.
12. As a matter of fact, the relief prayed for in both the writ petitions as well as at the time of argument, the petitioners have expressed that instead of permitting them to compete with the other traders in the open auction, new shops may be allotted in their favour at the rate determined by the Public Works Department. In the light of the factual details, the request of the petitioners seems to be quite reasonable and acceptable. It is also relevant to refer the information furnished in the counter affidavit of the Commissioner, City Municipal Corporation, Coimbatore. Though wide publicity was given notifying public auction / tender in "Dhina Mani" and "Makkal Kural" newspapers on 13.07.2002 and 07.09.2002, only few persons offered their bid for seven shops. It is clear that there is no takers for most of the newly constructed shops. It is further seen that for Shop No. 30, one of the bidders offered at the rate of Rs. 12.50 per square foot per month. The Commissioner has further stated that the highest bid for the new shops were ranging between Rs. 12/- and RS. 15.94/- per square foot per month, whereas the rate as per the Public Works Department is Rs. 12.95 per square foot per month. It is evident that first of all in spite of wide publicity, no takers for all the shops and the petitioners have also made a categorical statement that their allotment may be subject to the rate determined by the Public Works Department. In those circumstances, I am of the view that if the new shops are allotted in favour of the petitioners, there would not be any revenue loss to the Corporation. I am satisfied that the Government Order is not based on the relevant considerations and also defeats the principle of local governance. I am also satisfied that by accepting the petitioners case, who are the existing petty traders, the Corporation will be benefitted.
In the light of what is stated above, the Government Order impugned in W.P. No. 36280 of 2002, is hereby quashed. Consequently, the Commissioner, Corporation of Coimbatore is directed to allot shops to the petitioners at the newly constructed premises previously called as Thiru-Vi-Kalyanasundaranar Market at the rates determined by the Public Works Department and the said process shall be completed within a period of eight weeks from the date of receipt of a copy of this order. Accordingly, both the writ petitions are allowed. No costs. Consequently, connected WPMPs., and WVMPs., are closed.