Karnataka High Court
Sujay Enterprises, Bangalore vs Airport Authority Of India, Bangalore ... on 20 August, 2001
Equivalent citations: ILR2001KAR4634, 2001(5)KARLJ478
Author: A.V. Srinivasa Reddy
Bench: A.V. Srinivasa Reddy
JUDGMENT
1. The controversy involved herein pertains to awarding of the contract/licence for exclusive right of advertisement at Bangalore Airport.
2. The moot question is as to whether the respondent-Airport Authority of India (in short the 'Authority') had cogent reasons for annuling the tender process started by it under its tender notice dated 25-1-2000 (Annexure-A) for granting exclusive right of advertisement at Bangalore Airport and retender the same. Communications to the said effect were made to the rival tenderers under letter dated 9-5-2000 (Annexure-K).
3. The reasons for taking the above decision are contained in the minutes of the 48th Meeting of the Commercial Advisory Board (in short the 'Board'), which is the Competent Authority for the purpose. These minutes have been filed as Annexure-R3. These read thus.-
"The proposal for decision on the tenders for the aforesaid contract as also formulation of policy guidelines regarding treatment of outstanding dues for the purpose of 'No Dues Certificate' was placed before CAB. CAB took note of the observation of GM (Law) regarding contradiction in the condition regarding submission of No Dues Certificate in the NIT and tender documents. Chairman expressed anguish and unhappiness on the processing of the case by RED (SR). CAB also noted that GM (Law) has suggested for retendering in view of the above contradiction and the same has been endorsed by the Directorate of Finance and Commercial RED (AR) who did not give any categorical recommendation earlier while sending the proposal to CHQ also agreed with the view of retendering. During the course of discussions, Member (Ops) and Member (Finance) expressed the view that under the circum-
stances and having regard to the views expressed by Legal and Finance Departments, retendering will be the most appropriate course of action. CVO also expressed a similar view.
After discussions, a consensus was reached in the CAB that it would be appropriate to cancel the tenders received and call for fresh tenders. Member (Finance) pointed out the discrepancy in the Commercial Manual of both IAD and NAD which was brought out in the CAB note and suggested that to avoid any ambiguity, the policy to be adopted with regard to No Dues Certificate shall be decided and categorically stipulated while issuing fresh NIT to avoid similar situation in future.
CAB took the following decisions:
(i) The tender received may be cancelled and fresh tenders issued.
(ii) MRLF for the fresh tender will be retained as Rs. 19.00 lakhs p.m.
(iii) Existing contract of M/s. Sujay Enterprises may be extended for a further period of 6 months w.e.f. 5-2-2000 or till such time a new contract is finalised against the fresh tender, whichever is earlier, with a condition that the existing contractor shall pay 10% escalation on last L/Fee.
(iv) Since Commercial Manual of NAD calls for No Dues Certificate of all Airports at NAD, we may follow this provision as in NAD Manual for the contract at Bangalore airport until such time the provision is modified in the Unified Commercial Manual presently under ftnalisation. For TAD airports, the provision of TAD Commercial Manual will apply till such time, the unified Commercial Manual is finalised.
(v) With regard to outstanding dues which are the subject-matter of arbitration/Court case/examination by the committee of AAI, the matter needs to be examined further. However, whatever decision is taken regarding the above, the same will be uniformly applicable both for PSUs and other private sectors".
3-A, The 'Authority' is constituted under the provisions of the Airports Authority of India Act, 1994. It is not in dispute that the Authority is a 'State' within the meaning of Article 12 of the Constitution of India and therefore its actions must conform to the requirements of Article 14 of the Constitution, even in relation to the matters of contract and tenders. The law in this regard has been well-settled by the Apex Court and therefore it does not require any further exploration. (See: Sterling Computers Limited v Mis. M and N Publications Limited and Others , Food Corporation of India v M/s. Kamdhenu Cattle Feed Industries , and Tata Cellular v Union of Indic).
4. In the case of Tata Cellular, supra, it has been held that.-
"It cannot be denied that the principles of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favouritism. However, it must be clearly stated that there are inherent limitations in exercise of that power of judicial review. Government is the guardian of the finances of the State. It is expected to protect the financial interest of the State. The right to refuse the lowest or any other tender is always available to the Government. But, the principles laid down in Article 14 of the Constitution have to be kept in view white accepting or refusing a tender. There can be no question of infringement of Article 14 if the Government tries to get the best person or the best quotation. The right to choose cannot be considered to be an arbitrary power. Of course, if the said power is exercised for any collateral purpose the exercise of that power will be struck down".
5. In the case of Food Corporation of India, supra, the Supreme Court has approved the proposition that even if the tendering authority had the right to reject any tender including the highest tender, yet this right has to be exercised reasonably and not arbitrarily because otherwise the credibility of the procedure adopted for entering into contracts by inviting tenders would be lost. It was also accepted as sound proposition of !aw that tenders cannot be rejected at the whim and caprice of the concerned Authority and can only be for cogent reasons indicated while taking the decision or else, the decision will be arbitrary (See paras 5 and 6).
6. The Supreme Court in Food Corporation of India's case, supra, has also clearly spelt out that reasonable or legitimate expectation of a citizen, in itself is not a distinct enforceable right, because every legitimate expectation is a relevant factor requiring due consideration in a fair decision making process and this doctrine gets assimilated in the rule of law and operates in our legal system in this manner and to this extent only (See para 8).
7. Bearing the above principles in mind, we seek to analyse the facts in the present case to ascertain whether the decision of the Authority can be held to be short of cogent reasons and thus arbitrary.
8. In the present case, the main reason which prevailed with the Board was that there were obvious contradictions in the conditions regarding submission of No Due certificate in the notice Inviting Tenders (NIT) and the tender documents as has been noticed by the General Manager (Law) in his note dated 27-4-2000 (Annexure-1). This note reads as under.-
"Discussed which GM (Commercial). Here the problem relates to the ambiguity in the NIT. On one clause (Clause 3(a)) of NIT is speaking about the outstanding dues for Bangalore Airport only and on the Clause 9(2) of the general conditions it stipulates that there shall not be any outstanding dues for any other airports.
Hence, it would be difficult to defend the case if anybody goes to the Court challenging others right. The only solution is to call for a fresh tender by removing the ambiguity".
9. Now, we proceed to examine whether the ground of ambiguity taken for cancelling the tenders in question in fact existed and could have formed cogent reason for taking the impugned decision as communicated under Annexure-K.
10. Condition 3 of NIT puts a restraint on sale of tender documents to certain categories of persons. Clause (a) of this condition is relevant for the present purpose. It reads as under,--
"3. No tender shall be sold to either a firm or an individual falling under the following categories:
(a) Having outstanding dues except dues equal to current month's licence fee for the contract with AAI at Bangalore Airport.
(b)xxx xxx xxx xxx xxx. (c) xxx xxx xxx xxx xxx".
11. Guideline 5.5 of the Guidelines for Licensing "Airport Advertisement Rights (AAR) in Domestic and International Terminals at Bangalore Airport" reads as under.-
"Guideline 5.5.--'No Dues Certificate' to be obtained from the Aerodrome in charge of the Airport where the Tenderer is holding a licence already for any service".
12. Similarly, Guideline 9 of the Guidelines deals with 'Incomplete Tenders'. It reads as under.-
"9. Incomplete Tenders:
9.1 Tenders which do not fulfil all or any of the above conditions or are incomplete, render themselves liable to be rejected.
9.2 Tenders will be rejected, if there is outstanding dues owned by the Tenderer in respect of any contract with Airports Authority of India at any Airport/Civil Enclave under its administrative control".
13. A reading of Condition 3(a) of the NIT shows that it will be incompetent on the part of the Airport Authorities to sell tender papers to any firm or individual if there were any outstanding dues payable to the Authority for periods other than current month in respect of the Bangalore Airport only. On the other hand, guidelines stipulate that tenderer must obtain No Due Certificate from the authorities of all Airports where he is already holding licence for any service. Similarly, Guideline 9.2 of the Guidelines provides for rejection of tenders if it is found that tenderer owes any sum to the Authority in respect of any contract with it at any Airport/Civil Enclave under its administrative control.
14. From the above, on a reasonable construction it can well be inferred that there are contradictions in the terms relating to outstanding dues as contained in the NIT and the guidelines. As per the NIT, for being eligible for purchasing the tender documents one becomes eligible only by showing that there was no outstanding dues in respect of contract with the Authority only in respect of Bangalore Airport. Whereas, as per the guidelines, for being eligible for acceptance of contract it was found that he does owe any sum in respect of any contract with the Airports in India at any Airport/Civil enclave under its administrative control. These contradictions, as rightly pointed out by the General Manager (Law) and accepted by the Board, has given rise to the present set of litigations, in which both the tenderers have tried to rest their claims on one or the other clause a noticed above and have tried to derive benefit out of these contradictions.
15. Now, we proceed to notice the relevant facts pertaining to the two contesting tenderers, the appellant and the 2nd respondent.
The appellant, who is a proprietorship firm (proprietor Sri Sujay B.S.), was already holding contract/licence for exclusive right of advertisement at Bangalore Airport since 6-2-1995 which was to expire on 6-2-2000 through hoardings, translights, and show windows. He was having another contract at the Bangalore Airport for display of advertisement over Closed Circuit Television (CCTV).
16. Similarly, the 7th respondent had also obtained advertisement rights in several Airports in the country. In the present case, tenderers were required to furnish tenders in two envelopes; Envelope 'A' containing technical bid and Envelope 'B' containing financial bids. The bids were required to be submitted on or before 17-2-2000 and if the technical bid was found to be in order, then financial bid was to be opened on 24-2-2000.
17. According to the Authority, on the date on which tender documents were sold to the appellant, he was in due to the Authority in relation to two contracts at Bangalore Airport. For the first contract for advertising of hoardings, etc., in a sum of Rs. 66,00,359/- (Annexure-D). The accounts supporting the calculations have been furnished by the Director of Bangalore Airport Authority under affidavit dated 26-2-2001. It has also been stated that the appellant was owing a sum of Rs. 6,95,250/- even as on 29-3-2000 on account of second tender regarding advertisement over CCTV. The appellant in his reply to the Statement of Objections, has merely contradicted the statement of the Authority without giving his own facts and figures. As of fact, on time being extended on various occasions under letters dated 23-2-2000 (Annexure- B), 23-3-2000 (Annexure-C) and 25-3-2000 (Annexure-D), the appellant paid outstanding dues pertaining to the first contract on 27-3-2000.
18. So far as the 2nd contract is concerned, according to the Authority the appellant has paid a sum of Rs. 6,43,500/- on 12-4-2000 but is still due in a sum of Rs. 5,48,414/-. So far as respondent 7 is concerned, it has been stated on behalf of the Authority that though he had no dues in respect of any Airport including the Bangalore Airport except with regard to the advertising at New Delhi Airport. According to the Authority, the 7th respondent is liable to pay a sum of Rs. 20 crores (approximately). It has further been stated that the 7th respondent has raised counter-claim against the Authority for a sum of Rs. 14 crores (approximately) and the said issue has been referred to High Power Committee of the Executive Directors of the Authority. Admittedly, this dispute has arisen on account of the fire accident at the Domestic Air-Bus Departure Terminal, New Delhi. This fire had destroyed the entire terminal building.
19. Connected writ petition in W.P. No. 12514 of 2000 has been filed by the present appellant with the prayer that the financial bid of the 7th respondent should not be opened because he was owing substantial amount to the Authority for his rights at the New Delhi Airport. Whereas, the 7th respondent has also filed connected writ petition in W.P. No. 26199 of 2000 inter alia taking a stand that his bid is much higher than that of the appellant apart from the fact that he is ineligible to participate in the tender process since he has outstanding dues payable to the Authority in relation to the Bangalore Airport.
20. From the above facts and circumstances found through the pleadings of the parties, it is absolutely clear that according to the Authority both the appellant as well as the 7th respondent have defaulted in clearing the dues relating to the contracts entered into with the Authority though for one or the other reason, the two tenderers before us may have disputed their liability for one or the other reason.
21. It is also well-settled that mere disputing a liability in a bald manner cannot form a basis for claiming eligibility, where it forms a condition precedent for participating in the tender process. The dispute has to be shown as bona fide and genuine based on acceptable materials which genuinely requires a judicious adjudication. Moreover, even if the dispute is found to be genuine, bona fide and is pending adjudication before the Competent Authority, the tender notice, guidelines and other documents, providing for eligibility for participation in the tender process and acceptance thereof must make a specific stipulation regarding right of such a person to participate in the tender process if the issues regarding liability to the Authority are pending adjudication.
22. In the present case, admittedly, apart from the other in-built contradictions regarding various terms contained in the tender notice and the guidelines set out there is absolutely no provision regarding acceptance of tender by a person who is genuinely disputing his liability in relation to some other contract and is pending adjudication either internally or externally.
23. For the above reasons, we are quite satisfied that the Board, which was the Competent Authority to take decision in this regard, had reasonable and sufficient grounds before it to annul the questioned tender process and direct for retendering after removal of all the ambiguities and anomalies. Anyhow, keeping in view the facts and circumstances of the present case, we direct that the process of retendering should be completed on or before 30th October, 2001.
24. Before parting, we find it to be our duty to delve upon some of the important aspects concerning abuse of the processes of the Courts by the unscrupulous litigants resulting in miscarriage of justice, which of late are being conveniently adopted and used to make the judicial system itself a mockery. It is high time that the Courts should develop and adopt new legal principles and procedural checks and balances to meet these challenges.
25. In the present case, the present writ petition (W.P. No. 17372 of 2000) was filed by the appellant on 22-5-2000. It was dismissed on 24-5-2000, The present appeal was filed on 12-6-2000. On 20-6-2000, when the same was placed for admission, the Division Bench while issuing notice, also granted interim stay in terms of the prayer made in the LA. No. 2. The prayer was to the following effect.-
"For the reasons sworn to in the accompanying affidavit, the petitioner above-named prays that this Hon'ble Court may be pleased to issue an interim order of stay staying the operation and all further proceedings pursuant to the letter/order bearing No. AAI/BG/AD/ADVT.2000/161-162, dated 9-5-2000 and grant such other and further reliefs as are just.
Pending disposal of the writ appeal, the petitioner prays that this Hon'ble Court may be pleased to issue an interim and ad interim order of stay staying the operation of the order bearing No. AAI/BG/AD/ADVT.2000/161-162, dated 9-5-2000 (Annexure-K) in the interest of justice".
26. At this stage, it needs to be noticed that while communicating to the appellant about cancellation of the earlier tender process and proposing to retender the grant of rights in question under Annexure-K, dated 9-5-2000, the appellant was already enjoying the right of exclusive advertisement at Bangalore Airport. Since the retendering process would have taken some time the Competent Authority decided to permit the appellant to continue with that right during the interregnum period. It was done under letter dated 9-5-2000 addressed to the appellant. The material part of the said letter was to the following effect.-
"The Competent Authority has extended your licence for exclusive advertisement rights at Bangalore Airport for a period of six months w.e.f. 6-2-2000 or till such time a new contract is finalised, whichever is earlier, with 10% escalation of the licence fee".
27. The above proposal, as made on behalf of the Authority, was accepted by the appellant by continuing to enjoy the said exclusive right and also by accepting the above offer in writing with slight modification as is evident from Annexure-A to the affidavit filed by the proprietor of the appellant concern on 4-7-2001.
28. As a consequence of the interim order dated 20-6-2000 passed by this Court, the respondent-Authority became handicapped from initiating the process of retendering of the grant of exclusive right of advertisement at Bangalore Airport.
29. Just two days after obtaining the interim order from this Court, the appellant filed a civil suit in O.S. No. 4219 of 2000 before the City Civil Court, Bangalore, on 22-6-2000 against the Authority seeking permanent injunction against it and its servants restraining them from interfering with plaintiffs possession and enjoyment of the hoardings, translites and show windows erected in and around Bangalore Airport as per the plaint schedule. The appellant, as plaintiff, based his claim of seeking permanent injunction on the plea that he was enjoying subsisting exclusive right of advertisement at Bangalore Airport as per the letter dated 9-5-2000 (Document 3 to the plaint). In the suit, the appel-lant/plaintiff filed LA, No. 2 for grant of temporary injunction restraining the Authority and its servants from removing the hoardings, translites and show windows, which had been erected by him in and around Bangalore Airport. He also filed I.A. No. 3 seeking similar temporary injunction against the defendant Authority and its officials, restraining them from interfering with his right to maintain, paint and repaint the said advertising materials.
30. On the very day of filing the suit, i.e., 22-6-2000, Sri A.P. Murari, the XXVII Additional City Civil Judge issued suit summons and emergent notice by hand returnable by 24-6-2000 thereby granting hardly one day to the defendant Authority to take effective steps for appearance in the Court and instructing its Counsel for opposing the prayer.
31. On 24-6-2000, Sri F.N. Guddakar, XVI Additional City Civil Judge (CCH-12), passed the following.-
"The Counsel for the plaintiff had filed Memo and produced the SS and SN of I.A. Nos. 2 and 3. The defendant is called out, absent. Hence, the defendant is placed ex parte. Heard the Counsel for the plaintiff. I.A. Nos. 2 and 3 are allowed as prayed for. For ex parte hearing call on 25-8-2000".
32. We may notice here that though the appellant had sought for temporary injunction on the basis of a contract entered into with the Airport Authority but the Trial Judge without even examining the terms of the contract and insisting upon him to perform his part of contract of paying the due licence fee, granted ex parte, unconditional temporary injunction, which, as we will be shortly noticing has resulted in unjustly enriching him.
33. It has been stated by Sri K.G. Raghavan, learned Senior Advocate for the respondent-Authority, that though notice and summons were served on 23-6-2000 but, within an extremely short span of just one day, effective steps for appearance of the Authority could not be taken. His further submission was that the appellant plaintiff, by simultaneously taking recourse to two parallel legal remedies both before this Court as well as before the Civil Court and by obtaining interim order at both forums, as noticed above, successfully crippled the Authority in initiating the retendering process or entering into contract with some other advertising agencies as an stopgap arrangement.
34. Faced with the above situation, the Authority apart from filing its written statement in the suit, had also filed counter-affidavit to LA. Nos, 2 and 3 filed for injunction. Sri K.S. Krishna Murthy, Airport Director, also filed his personal affidavit on 28-6-2000 clearly stating therein that the appellant/plaintiff had suppressed material facts regarding pendency of the present writ appeal before this Court in relation to the same subject-matter and requested the Court below to refuse the prayer for grant of temporary injunction. On 27-6-2000, the defendant Authority filed LA. No, 5 for advancement of hearing on LA. Nos. 2 and 3 regarding grant of temporary injunction from 25-8-2000 to 28-6-2000. On the said LA. No. 5, the parties were heard by the Court below on 4-7-2000 and fixed the case on 9-8-2000 for hearing on the said LAs. But, curiously, the Court below instead of taking serious view of the facts placed before it and the stake involved, just went on adjourning the case.
35. By taking advantage of the above situation and helplessness caused to the Authority, the appellant/plaintiff conveniently stopped paying the licence fee as required under the contract, thereby unjustly enriching himself, According to the affidavited statement, which was filed on 6-7-2001 by the Airport Director, till 5-7-2001 the dues against the appellant had swelled upto a sum of Rs. 2,25,99,286/-.
36. In the case of Mahadeo Savlaram Shelke v Pune Municipal Corporation, it has been held that-
"It would thus be clear that in a suit for perpetual (sic) injunction, the Court should enquire on affidavit evidence and other material placed before the Court to find strong prima facie case and balance of convenience in favour of granting injunction otherwise irreparable damage or loss would ensue to the plaintiff. The Court should also find whether the plaintiff could adequately be compensated by damages if injunction is not granted. It is common experience that injunction normally is asked for and granted to prevent the public authorities or the respondents to proceed with execution of or implementing scheme of public utility or granted contracts for execution thereof. Public interest is, therefore, one of the material and relevant considerations in either exercising or refusing to grant ad interim, injunction, While exercising discretionary power, the Court should also adopt the procedure of calling upon the plaintiff to file a bond to the satisfaction of the Court that in the event of his failing in the suit to obtain the relief asked for in the plaint, he would adequately compensate the defendant for the loss ensued due to the order of injunction granted in favour of the plaintiff. Even otherwise the Court while exercising its equity jurisdiction in granting injunction has also jurisdiction and power to grant adequate compensation to mitigate the damages caused to the defendant by grant of injunction restraining the defendant to proceed with the execution of the work etc. The pecuniary award of damages is consequential to the adjudication of the dispute and the result therein is incidental to the determination of the case by the Court. The pecuniary jurisdiction of the Court of first instance should not impede nor be a bar to award damages beyond its pecuniary jurisdiction. In this behalf, the grant or refusal of damages is not founded upon the original cause of action but the consequences of the adjudication by the conduct of the parties, the Court gets inherent jurisdiction in do ex debito justi-tiae mitigating the damage suffered by the defendant by the act of the Court in granting injunction restraining the defendant from proceeding with the action complained of in the suit. It is common knowledge that injunction is invariably sought for in laying the suit in a Court of lowest pecuniary jurisdiction even when the claims are much larger than the pecuniary jurisdiction of the Court of first instance, may be, for diverse reasons. Therefore, the pecuniary jurisdiction is not and should not stand an impediment for the Court of first instance in determining damages as part of the adjudication and pass a decree in that behalf without relegating the parties to a further suit for damages. This procedure would act as a check on abuse of the process of the Court and adequately compensate the damages or injury suffered by the defendant by act of Court at the behest of the plaintiff'.
37. At this stage, it is important to notice here that the appellant designedly suppressed certain material facts in the writ petition as well as the writ appeal filed before this Court that despite taking of decision by the Authority of retendering of exclusive right of advertisement at Bangalore Airport, as an stopgap arrangement the existing contract with the appellant was continued under letter dated 9-5-2000. Similarly, he also suppressed the material facts in his suit regarding Authority's decision of retendering of the said exclusive right of advertisement and the circumstances under which he was favoured with extension of contract with him under letter dated 9-5-2000. Further, he had also suppressed the fact in his suit that in relation to the dispute between the parties pertaining to the very "exclusive right of advertisement at Bangalore Airport", the matter is pending adjudication before the High Court at his instance and that an interim order had already been obtained by him.
38. It cannot be disputed that the relief, which the appellant/plaintiff had sought in the civil suit, was very much incidental to the dispute which was pending in the High Court and therefore the same could have been asked for, in the writ appeal itself. Viewed from this angle, the suit filed by him was not at all maintainable. The totality of the circumstances appearing in the case clearly indicate that the appellant is guilty of suppressing material facts both before this Court as well as the Civil Court.
39. In view of the facts brought on record, the appellant despite comfortably availing the benefit of enjoying exclusive right of advertisement at Bangalore Airport on the basis of the interim orders passed by this Court and the City Civil Court conveniently avoided to discharge his part of the contract pertaining to payment of licence fee. Since the said unwarranted benefit has been availed by the appellant because of the interim orders obtained by him, in order to meet the ends of justice and equity, it needs to be made imperative for him to perform his part of contract by paying all the contractual dues towards licence fee as per the term contained in the letter dated 9-5-2000. Accordingly, we direct that he must clear all the dues within 16 days of the demand raised in this behalf by the Authority. Till all the dues are cleared, his movables and immovables will remain under attachment. With termination of the contract by the Authority, they will be entitled to remove all the hoardings, translites and show windows and other articles belonging to the appellant and keep the same as security with them, till the dues are cleared.
40. We also express our displeasure about the manner in which interim injunction has been granted by the Trial Court in the present case. Firstly, the Courts concerned are duty-bound to give sufficient time to the defendant to enter appearance and object to the interim prayer made. If the Courts find that there is some urgency requiring giving of interim injunction to the plaintiff, it can do so by passing appropriate orders, which can be confirmed or modified on hearing the defendant and the parties will have to get their rights adjudicated as per the settled legal principles pertaining to grant of injunctions.
41. As in the present case, by granting sufficient time of at least 2 weeks to the defendant to file objections, the Trial Court could have conveniently decided as to whether there should be an order of injunction in terms of the Order 39, Rules 1 and 2 of the Civil Procedure Code, Moreover, it is well-settled that while granting temporary injunction, even if it is ex parte, the Trial Court has to adhere to the requisite legal norms judicially laid down, like finding of prima facie case, balance of convenience, and irreparable injury. If the facts of the case so requires, the Court should also put the plaintiff to terms to discharge his part of legal obligations. This certainly requires judicious and judicial application of mind which must necessarily reflect in the order itself. But in the present case, surprisingly, the Trial Court did not even find it necessary to examine any of the above aspects which are prerequisites for exercising jurisdiction under Order 39, Rules 1 and 2 of the Civil Procedure Code. The order on its very face is laconic. We deprecate passing of such orders.
42. We feel that for effectively meeting the requirements of natural justice of giving reasonable opportunity of hearing to the defendants, the Courts must grant minimum two weeks time from the date of service on the defendant(s) for appearance and taking their defence. We also disapprove the practice of permitting the plaintiff to take summons by hand, particularly in cases where the defendants are either the Governments or its instrumentalities like the Statutory Authorities, Corporations, Government Companies etc. In our opinion, if the nature of dispute involved and the relief claimed warrant emergent service of summons/notices to the defendants, it should be done by availing the facilities of speed post or dependable and recognised couriers, a list whereof can be prepared and circulated by the High Court. We are giving these directions because we have come across several cases where great prejudice has been caused to the public interest by permitting service by hand summons returnable within two days and thereafter disposing of applications for grant of interim reliefs or even final disposal ex parte. At times such hasty steps are taken on the basis of affidavited statements made on behalf of the plaintiff regarding service and other matters which on appearance of the defendants are found to be palpably false.
43. Of late, it is being increasingly felt that unscrupulous litigants by way of dubious and fraudulent methods have been found instituting multiple proceedings at different judicial forums with regard to the same subject-matter and thereby have been trying to frustrate the course of justice. Taking serious view of this vice, the Supreme Court in the case of Advocate General, State of Bihar v M/s. Madhya Pradesh Khair Industries and Another , has condemned the same by holding that filing of frivolous and multiple cases for the same purpose amounts to criminal contempt. In this judgment, it bas been held that.-
"......a course of conduct which abuses and makes a mockery of the judicial process and which thus extends its pernicious influence beyond the parties to the action and affects the interest of the public in the administration of justice. The public have an interest, an abiding and a real interest, and a vital stake in the effective and orderly administration of justice, because, unless justice is so administered, there is the peril of all rights and liberties perishing".
44. In the case of Rajappa Hanamantha Ranoji v Mahadev Channabasappa and Others, it has been held that.-
"It is distressing to note that any unscrupulous litigants in order to circumvent orders of Courts adopt dubious ways and take recourse to ingenious methods including filing of fraudulent litigation to defeat the orders of Courts. Such tendency deserves to be taken serious note of and curbed by passing appropriate orders and issuing necessary directions including imposing of exemplary costs".
45. We note with concern that tendency of filing frivolous litigations are alarmingly increasing possibly because of the reason that our procedural law has not provided an effective mechanism to check the vice. In the case of Advocate General, supra, the Supreme Court has noted with approval the observations made in a English case (Jennison v Baker), wherein it was said that "the law should not be seen to sit by limply, while those who defy it go free, and those who seek its protection lose hope".
46. For the foregoing reasons, we strongly feel that in order to check multiplicity of proceedings pertaining to the same subject-matter, to make justice delivery system faster and less expensive and more importantly, to stop the menace of soliciting inconsistent or supplemental ex parts orders through different judicial forums by suppressing material facts, either by remaining silent or by making misleading statements in the pleadings, in order to escape the liability of making false statement, in our considered opinion, the parties to the dispute should be necessarily required to disclose in their pleadings, the details of all the legal proceedings and litigations either past or present, concerning any part of the subject-matter of dispute, which may be properties (movable or immovable) and/or claims, rights, or obligations, arising out of the contracts, customs, usage, representations and the like, which is within their knowledge. In case, according to the parties to the dispute, no legal proceedings or Court litigations was or is pending, they must specifically state so in their pleadings. This factual information is certainly 'material fact' within the meaning of Order 6, Rule 2 of the Civil Procedure Code and Rule 2(2) of Part I of the Writ Proceedings Rules, 1977 and therefore has to be mandatorily stated for resolving the lis between the parties in accordance with law of the land.
47. For the aforesaid reasons, we further direct the Trial Court to dispose of the suit in O.S. No. 4219 of 2000 within six weeks from the date of communication of this judgment.
48. With the aforesaid observations and directions, the writ appeal is dismissed with costs assessed at Rs. 20,000/-.