Patna High Court - Orders
M/S Socrpion Express Pvt.Ltd. vs The Union Of India & Ors on 15 July, 2011
IN THE HIGH COURT OF JUDICATURE AT PATNA
CWJC No.9945 of 2010
M/S Scorpion Express Pvt. Ltd., having its Regd. Office at Ashok
Cinema Building Budh Marg, Patna Through its Branch Incharge and
Constituted Attorney Shri Parwez Ahmad Siddiqui, S/o Razi Ahmad
Siddiqui.................................................Petitioner.
Versus
1. The Union of India through the Secretary, Ministry of Railways,
New Delhi.
2. East Central Railway Hajipur, through its General Manager.
3. Chief Commercial Manager, East Central Raiway, Hajipur (A Block
Dighi at Hajipur).
4. Divisional Railway Manager, East Central Railway, Hajipur.
5. Additional Chief Commercial Manager, E.C.R. Hajipur.
6. Executive Director, Freight Marketing Railway Board, New Delhi.
7. Senior Divisional Commercial Manager, Danapur.
8. Deputy Chief Commercial Manager Marketing, Hajipur.
9. The Chief Parcel Supervisor, S.C.R. Rajendra Nagar,Tribunal Patna.
10. Railway Board, through the Secretary, Ministry of Railways, New
Delhi
11. Godrej and Boyce Mfg. Co. Ltd. through its Branch Manager,
Jeevandeep, Exhibition Road, Patna-800001.....Respondents.
Advocates for Petitioners : Mr. Y.V. Giri, Sr. Advocate with
Mr. Sanjeev Sharan, Advocate.
Advocates for
Respondents No. 1 to 10 : Mr. N.K. Agrawal, Sr. Advocate with
Mr. Arbind Ujjwal, Advocate.
Advocate for
Respondent No.11 : Mr. S. Arshad Alam Advocate with
M/s G.K. Yadav & Anjum Perveen,
Advocates.
PRESENT
HON'BLE MR. JUSTICE S.N. HUSSAIN
ORDER
26/ 15.07.2011This writ petition has been filed by the petitioner for a direction to respondents authorities of the East Central Railways for granting two years extension to the petitioner in terms of Clause 18.1 of the Agreement for Leasing of Parcel Space in Brake Vans/Parcel Vans/Asst. Guards Cabin of Train No.3201/3202 from Rajendra Nagar Terminal Patna to Lokmanya Tilak Terminal Mumbai and to cancel Tender Notice dated 01.06.2010 issued for the -2- said leasing contract for the said train.
2. Petitioner is a private limited company dealing in the business of carriage of goods and for that purpose it was registered lease holder under „A‟ category of Railway working in various zones thereof. The petitioner submitted his tender in response to notice inviting tender dated 03.11.2006 issued by the East Central Railway for leasing Parcel Van and spaces on Round Trip basis in the aforesaid train in view of the scheme introduced by the Railway Board for the said purpose for all the Railways.
3. The claim of the petitioner is that being the highest bidder contract was awarded to it and agreement was executed by the parties with respect thereto on 08.03.2007 (Annexure-1) setting out the terms and conditions of the contract, which was for three years i.e from 29.03.2007 till 28.03.2010. Work order dated 12.03.2007 (Annexure-1/A) was also issued by the respondents in favour of the petitioner pursuant to the said agreement in which the rate for round trip was specified as Rs.87,000.00 and the petitioner deposited Rs.50,000.00 as security deposit.
4. Mr. Y.V. Giri learned counsel for the petitioner stated that by clause 18 of the contract permission was granted for extension of lease by two more years at a lease rate of 25 % more than the lump sum leased freight rate. He further stated that Freight Marketing Circular No.12 of 2006 dated 28.03.2006 (Annexure-A of petitioner‟s rejoinder) also provided the said extension in clause E-2 thereof. Hence he claimed that in view of the aforesaid provisions petitioner was fully entitled to extension of the lease by two years, but just before the date of completion of lease i.e. 28.03.2010, the respondents issued Freight Marketing Circular No.03 of 2010 dated 09.02.2010 (Annexure-3) by clause 4.0, by which Para E-2, along with Paras E-1 and E-3 -3- of Freight Marketing Circular No.12 of 2006, was deleted.
5. Learned counsel for the petitioner submitted that the respondents also issued Freight Marketing Circular No.06 of 2010 dated 18.03.2010 (Annexure-4) by clause 2.1 of which it was held that the cases of existing contracts, which were in operation and agreement/contract signed before issue of Freight Marketing Circular No.3 of 2010 i.e. prior to 09.02.2010, shall be governed by the policy guidelines applicable before issue of Freight Marketing Circular No.03 of 2010. Hence he further submitted that in view of Circular No.06 of 2010, the withdrawal of clause E-2 of Circular No.12 of 2006 by way of Circular No.03 of 2010, will not govern and affect the term of extension provided in the lease of the petitioner dated 08.03.2007.
6. Learned counsel for the petitioner relied upon a decision of a bench of this court vide order dated 09.07.2010 passed in C.W.J.C. No.9396 of 2010 in which it was held as follows:
"Thus, in the light of the aforesaid discussions, it is evident that in terms of Freight Marketing Circular No.12/2006 dated 27.03.2006 read with Circular No.06/2010 dated 18.03.2010, the petitioner was entitled to get extension of the lease contract for a further period of two years from 2.3.2010. The case of the petitioner is not at all covered by Freight Marketing Circular No.03/2010 dated 9.2.2010. The impugned order dated 25.2.2010 is thus contrary to the policy of the Railway in this regard as clearly expressed in the aforesaid two Circulars and it is, accordingly, quashed."
7. It transpires that the petitioner filed a representation dated 23.09.2009 before the Chief Commercial Manager of East Central Railways for two years extension, but vide order dated 03.03.2010 (Annexure-5) the said authority granted three months extension only refusing to extend any further and only thereafter this writ petition was filed on 29.06.2010 in which an -4- interim order was passed by a Bench of this court on 30.06.2010 directing stay of the tender notice dated 26.05.2010 (Annexure-8) and directing the petitioner to continue avail of the lease facility in terms of clause 18 .1 of the earlier Agreement.
8. Learned counsel for the petitioner further submitted that the prayer of the petitioner for extension of lease was for two years i.e. from 29.03.2010 till 28.03.2012 out of which major period has already passed during which the petitioner has continued to avail the lease facility in terms of Clause 18.1 of the Agreement in question and only about eight months have remained for completion of the extension of two years. He also averred that the respondents will not be put to any harm if the period is extended as there is no allegation against the petitioner nor any stigma is cast upon it and the extension had been refused by the authorities concerned only due to change of the policy as claimed by the respondents.
9. On the other hand, Mr. S. Arshad Alam learned counsel for respondent no.11, which is a private limited company, vehemently opposed the contentions of learned counsel for the petitioner and submitted that the petitioner had filed this writ petition on 28.06.2010 for the reasons mentioned above challenging tender notice dated 01.06.2010, but concealed the fact that he had also participated in the tender which was opened on 22.06.2010 in which respondent no.11 succeeded but the petitioner was not found fit and only thereafter he had filed the writ petition on 28.06.2010 without stating the aforesaid facts and without impleading respondent no.11.
10. Learned counsel for respondent no.11 further claimed that the law is well settled that in a commercial transaction the High Court should interfere only when public interest is involved, but in the instant case neither -5- any public interest is involved nor any mala fide is claimed by the petitioner against the respondents in the entire writ petition. In this connection he relied upon a decision of the Apex Court in case of Raunaq International Ltd. vs. I.V.R. Construction Ltd. and others, reported in A.I.R. 1999 SC 393. Learned counsel for respondent no.11 also averred that the petitioner had distorted clause 18.1 of the agreement in question dated 08.03.2007 (Annexure-
1) with respect to extension and had violated clause 18.5 of the said agreement by overloading the Parcel Van leased to him and hence he is not entitled to get the benefit of clause 18.1 and had failed to comply with the provisions of the agreement.
11. Learned counsel for respondent no.11 stated that learned counsel for the petitioner had wrongly relied upon order dated 09.07.2010 passed in C.W.J.C. No.9396 of 2010 as in the said case there was no tender, but in the instant case there was a tender in which the petitioner had participated and had failed. Furthermore, in the earlier case there was only charge of rupees ten thousand and odd, whereas in the instant case there is a penalty of rupees thirty thousand and odd. Hence, he averred that there is complete difference in the facts and circumstances of both the cases and accordingly the aforesaid case law is not applicable to the facts and circumstances of this case.
12. Learned counsel for respondent no.11 argued that the petitioner has not come with clean hands and has suppressed the material facts and hence this writ petition is fit to be dismissed. In support of his aforesaid contentions, he has relied upon decisions of three High Courts in case of Rakesh Singhal and another vs. Vth Addl. Distt. and Sessions Judge, Bulandshar and others, reported in A.I.R. 1990 Allahabad 12; in case of M/s Seemax Construction (P) Ltd. vs. State Bank of India and another, -6- reported in A.I.R. 1992 Delhi 197; and in case of Agarwal Industries Ltd. vs. Golden Oil Industries (P) Ltd., reported in A.I.R. 1999 Bombay 362.
13. Mr. N.K. Agarwal learned counsel for the Union of India and the Railway authorities, namely respondent nos.1 to 10 argued that the provision of extension in agreement in question was made subject to the satisfaction of the authorities, but the work of the petitioner was not satisfactory as penalty had already been imposed upon the petitioner by the Railways. He further submitted that in the case law relied upon by learned counsel for the petitioner, namely order dated 09.07.2010 passed in C.W.J.C. No.9396 of 2010 the question of penalty was not there nor there was any question of unsatisfactory work by the petitioner of that case, but in the instant case penalty had been imposed upon the petitioner and his work was not found satisfactory, hence the petitioner was not entitled to any extension.
14. Considering the entire facts and circumstances of this case as well as the arguments of the parties and the materials on record, it is quite apparent that although the decision of the other Bench of this Court dated 09.07.2010 passed in C.W.J.C. No.9396 of 2010 (M/s Sri Sai Logistics vs. The Union of India & ors.) was with respect to a similar agreement with a clause of extension, but in that case there was no allegation with respect to any illegality or unsatisfactory work but in the instant case there was specific allegation against the petitioner that he had also violated clause 11.15 of the agreement by overloading the Parcel Van leased to him for which the petitioner was penalized with Rs.32,360.00. Subsequently on 20.07.2010 also the petitioner was detected to have overloaded SLR leased to him by whopping 2.756 tonnes for which he was penalized with Rs.62,580.00 and due to the said overloading the train got parted near east cabin Mughalsarai at 03.10 hours and near Sakaldiha Station at -7- 06.20 hours and hence he had caused safety hazard leading to derailment of a prestigious train like Rajdhani Express etc.
15. The extension clause in the agreement, namely clause 18.1 also provided that extension of lease is permissible only in case of long term lease of three years wherein the same can be extended only once by two more years at a lease rate of 25 % more than the lump sum leased freight rate subject to satisfactory performance by the lease holder without any penalty for overloading or violation of any provision of the contract. In absence of the said conditions extension of lease cannot be legally permitted under the said clause. In the said case there was no fresh tender and hence the court passed the said order as there was no other claimant on whom any right had accrued, but in the instant case admittedly there had been a tender in which the petitioner also participated but it was decided in favour of respondent no.11 and the petitioner lost.
16. Furthermore, the petitioner had full knowledge about his participation in the said tender, opening of the tender, rejection of his tender and acceptance of the tender of respondent no.11, which took place much before filing of this writ petition but the said facts were concealed by the petitioner as no statement with respect thereto was made therein nor respondent no.11 was impleaded as a party to the writ petition, although a right had clearly accrued to him. Thus, the petitioner had clearly not come with clean hands in the instant writ petition and hence he is not entitled to any relief under Article 226 of the Constitution of India.
17. On merits also, the only clause regarding extension of lease contract is clause 18, but the extension provided therein is subject to the satisfactory performance by the lease holder without any penalty for -8- overloading or violation of any provision of the contract. In the instant case, it is quite apparent that the performance of the writ petitioner was not satisfactory as penalty for overloading was imposed upon the petitioner-lease holder, who had also violated the provisions of the contract. Hence, the petitioner cannot legally seek extension in accordance with the aforesaid clause of agreement.
18. In the aforesaid facts and circumstances, this court does not find any merit in this writ petition, which is accordingly dismissed.
Harish (S.N. Hussain, J.)