Karnataka High Court
Clear Channel Communications Pvt Ltd., vs Bruhath Bangalore Mahanagara Palike on 30 January, 2013
Author: A.S.Bopanna
Bench: A S Bopanna
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IN THE HIGH COURT OF KARNATAKA AT BANGALORE
DATED THIS THE 30TH DAY OF JANUARY, 2013
BEFORE
THE HON'BLE MR. JUSTICE A S BOPANNA
W.P.Nos.10842-10850/2012 (LB-BMP)
Between:
Clear Channel Communications Pvt.Ltd.
By its Asst. Manger
No.311, Third Floor, Barton Centre
No.84, M.G. Road
Bangalore - 560 001 ...Petitioner
(By Sri Puttige R Ramesh, Adv.)
And:
1. Bruhat Bangalore Mahanagara Palike
By its Commissioner
N.R. Square
Bangalore - 560 002
2. The Executive Engineer
Road Infrastructure Traffic Engineer Cell
Bruhat Bangalore Mahanagara Palike
N.R. Square
Bangalore - 560 002 ...Respondents
(By Sri N.R. Jagadeeswara, Adv. for C/R1 )
These writ petitions are filed under Article 226 of the
Constitution of India, praying to direct the respondents to
issue NOC as demanded by the petitioner in Annexure-O
dated 26.03.2012 in respect of seven gantries and etc.
These Writ Petitions having been reserved for orders,
coming on for pronouncement this day, the Court
pronounced the following:
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ORDER
The petitioner is before this Court seeking for issue of mandamus and direct the respondents to issue 'No objection Certificate' ('NOC' for short) as sought by the petitioner through a communication dated 26.03.2012 at Annexure-O. The petitioner has also sought for granting alternate locations in respect of two gantries as sought under the said communication and a consequent mandamus to fix the advertisement tax in respect of the said gantries is also sought.
2. The case of the petitioner is that they were given right to instal the gantries through an agreement dated 10.06.2011 executed by the second respondent on behalf of Bruhat Bangalore Mahanagara Palike (BBMP for short). Pursuant thereto, though the petitioner has installed the gantries and has fixed the sign boards on its one side, they have not been permitted to put up advertisements on the other side which is the object of putting up such gantries under the 'build, operate and transfer' basis ('BOT' basis for 3 short) which is in the nature of public-private partnership wherein the BBMP and the general public get the benefit of the sign-boards while the petitioner recovers and cost incurred for such installations through display of advertisements and the BBMP further benefits from the advertisement tax that would be levied for such advertisements. In this regard, at an earlier instance an endorsement dated 17.09.2009 was issued to the petitioner indicating that the request of the petitioner for installing gantries cannot be permitted in view of the order passed in W.P.No.6473/2009. In the said writ petition which had been filed by another out-door advertisement company relating to the tender notification, this Court had made certain observations that neither the Act nor the bye-laws provide for installation of gantry across the street. During the pendency of the said petition, an affidavit had been filed by the Commissioner and in that circumstance, the writ petition was ultimately disposed of since the tender notification itself had been withdrawn. 4
3. The petitioner herein assailed the said endorsement dated 17.09.2009 in W.P.No.103/2010. This Court having noticed the earlier order in W.P.No.6473/2009 made reference to the advertisement bye-laws, 2006 which had reference to the manner of display of advertisement including on gantries had quashed the endorsement and directed the respondents to consider the petitioner's case afresh giving due weightage to the provision contained in 3.L(ii) of advertisement bye-laws,2006. On reconsideration, the first respondent had rejected the request of the petitioner by the order dated 28.10.2010. The petitioner who was aggrieved by the same, had filed an appeal to the standing committee which upheld the contention of the petitioner and allowed the appeal by its decision dated 11.03.2011. The same was placed before the BBMP Council. By the resolution dated 29.03.2011, the decision of the standing committee was resolved to be accepted. Pursuant thereto, the second respondent herein acting on behalf of the BBMP had called upon the petitioner by the demand notice dated 31.05.2011 to 5 deposit the ground rent in respect of the said gantries. The petitioner is stated to have deposited through a demand draft dated 01.06.2011. In consideration thereof, the agreement dated 10.06.2011 was entered into between the petitioner and the second respondent. Subsequent to the said agreement, the petitioner based on the further communications addressed by the second respondent has undertaken the work, installed the gantries and put up the sign boards at 7 locations as against the 9 locations indicated in the agreement. In respect of two other locations, the installation of gantries was not possible in view of change in the alignment of the road and other developmental activities. It is in that context the petitioner by the communication dated 26.03.2012 (Annexure-O) has sought for NOC in respect of the installed gantries and the alternate location for installation of the two gantries which could not be installed for the reason stated. Since the said request has not been considered, the petitioner has sought for the relief as prayed in the petition.
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4. The first respondent has filed the objection statement. The agreement entered into between the petitioner and the second respondent is sought to be disowned by the first respondent by contending that the second respondent had no power or authority to do any acts in respect of advertisement matters. Hence, it is contended that the action taken by the second respondent is not binding on the first respondent. Section 67 of the Karnataka Municipal Corporations Act, 1976 ('the Act' for short) is referred to indicate that the power available with the Commissioner can be exercised by any other Officer only if there is delegation of power made thereunder. It is contended that no such power had been delegated to enter into the agreement dated 05.06.2011. In that context, it is the case of the first respondent that when the agreement does not create any right, no mandamus can be sought to act upon the said agreement. It is also the case of the first respondent that the Commissioner had not taken any decision to permit installation of gantries to any person nor had the process of inviting open tenders been 7 followed. Further, reference is made to the proceedings in W.P.No.6473/2009 relating to the installation of gantries and advertisement and that no relief was granted to one other petitioner therein. The affidavit said to have been filed in the said proceedings is referred. That apart the first respondent has relied upon the order dated 28.10.2010 passed by him after disposal of W.P.No.103/2010 whereby the request of the petitioner had been rejected. In such circumstance, the second respondent could not have entered into an agreement. It is also contended that the Additional Secretary, Urban Development Department had received a complaint dated 15.03.2012 alleging illegal activities of the second respondent and petitioner with regard to the allotment of gantries without public tenders. The proposal to amend the advertisement bye-laws being sent for consideration of the Government is referred. In view of the order passed by the first respondent rejecting the request of the petitioner, the first respondent contends that the petitioner is not entitled to the relief.
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5. In the light of the rival contentions, I have heard Sri Puttige R.Ramesh, learned counsel for the petitioner and Sri N.R.Jagadeeshwara, learned counsel for the respondents and perused the writ papers including additional material submitted by the learned counsel for both the parties along with the respective memo filed by them.
6. The reliance placed by the respondents initially is to the order passed in W.P.No.6473/2009. A perusal of the copy produced along with the objection statement would no doubt indicate that certain observations were made relating to installation of gantries. What is also to be noticed is that such observations were made in the light that no provision or bye-law were brought to the notice of the Court. Be that as it may, it would not be necessary for me to dilate further on that aspect since the contention relating to the order in W.P.No.6473/2009 had been put forth in the earlier petition between the parties herein in W.P.No.103/2010 which was filed by the petitioner herein assailing the 9 endorsement which rested on the order in W.P.No.6473/2009. In the said petition, by the order dated 19.07.2010, the learned Judge had taken note of the advertisement bye-laws 2006 wherein bye-law No.3.L(ii) was referred to and in that context, had taken note of the contentions that the said bye-law had not been canvassed in the earlier writ petition. In such circumstance, the learned Judge had not accepted the contention that the endorsement was justified in view of the order in W.P.No.6473/2009 and on quashing the endorsement had directed consideration giving due weightage to the provisions contained in the said bye- law No.3.L(ii).
7. In that context, a perusal of the said bye law No.3.L(ii) would indicate that the display of advertisements on structures including gantries is prohibited, but it could be permitted by the Commissioner under special circumstances, if it is in the interest of the corporation as in cases of public- private partnership for infrastructure creation. The 10 same is to be done as per the guidelines laid down by the Commissioner from time to time. The bye-law would therefore indicate that it is the Commissioner who would have to take a decision in that regard. Pursuant to such direction by this Court, the Commissioner who was required to consider the same, has in fact considered and thereafter passed the order dated 28.10.2010 (Annexure-R.2) whereunder the request of the petitioner has been rejected. If the matter had rested at that, certainly no further consideration was required in the manner as sought by the petitioner in the instant petition since the Commissioner had exercised the discretion vested in him under the said bye-law, against the petitioner.
8. However, presently, the petitioner is claiming right under the agreement dated 10.06.2011 (Annexure- E) executed by the second respondent. The said agreement is disowned by the first respondent - Commissioner as one being without authority and not binding on the first respondent. Though the Commissioner has heavily relied on the order dated 11 28.10.2010 passed by him rejecting the claim of the petitioner and has contended that the agreement would not create any right, the first respondent in fact has not referred to in their objection statement about the proceedings that had taken place subsequent to the order dated 28.10.2010. In my view, the said proceedings would assume relevance to come to a conclusion as to whether the first respondent could still place reliance on the said order dated 28.10.2010 to resist the prayer sought in the petition and to contend that the second respondent has acted without authority.
9. In that regard, the document at Annexure-B relied upon by the petitioner would indicate that the petitioner claiming to be aggrieved by the order dated 28.10.2010 passed by the Commissioner subsequent to disposal of W.P.No.103/2010 had filed an appeal before the standing committee as contemplated under Section 444 of the Act. The standing committee i.e., the Appellate Authority by its decision dated 11.03.2011 had allowed the appeal and had decided that the 12 Commissioner shall permit the petitioner to install 9 gantries. The said decision of the standing committee was placed before the General Council of the BBMP in Subject No.5(289)/2010-11. By the resolution dated 29.03.2011, it was resolved to accept the decision dated 11.03.2011 taken by the standing committee.
10. Pursuant to the said resolution, the decision for entering into the agreement is said to have been taken on the file being processed further. The learned counsel for the respondents would however rely on a communication dated 20.06.2012 which is produced along with the additional list of documents to contend that the Commissioner has thereafter addressed a letter to the Principal Secretary, Urban Development Department to review the decision of the Council of the BBMP and to cancel the same for the reasons indicated therein. Hence, it is sought to contend that the Commissioner did not seek to implement the order of the standing committee which had been approved by the resolution of the BBMP Council. In that regard, the 13 note sheet which had been opened for the purpose of considering the same and sending the communication dated 20.06.2012 to the Government is relied upon.
11. On the other hand, the sequence of events which had taken place after the resolution of BBMP Council is sought to be relied upon by the learned counsel for the petitioner. To point out that the agreement was entered into with the knowledge of the Commissioner as the decision of the standing committee and BBMP Council was within his knowledge, the note sheet pursuant to the proceedings of the BBMP Council is referred to by the learned counsel for the petitioner by filing the same along with the memo for producing the additional documents. In that regard, the note sheet at note No.206 would indicate that on 18.04.2011, the Secretary to the BBMP Council had placed the resolution dated 29.03.2011 before the Commissioner. The Commissioner has endorsed the note sheet on 25.04.2011 which indicates that the Commissioner was aware of the resolution passed by the BBMP Council. 14 The file was thereafter placed before the Joint Commissioner (Advertisement) as it was routed by the Commissioner. The Joint Commissioner by his note at 209 has placed it for further action. This would indicate that the resolution passed by the BBMP Council has been ordered to be acted upon by the note of the competent person and the further action was to be taken in that regard. This in fact if juxtaposed with the contention on behalf of the respondents that a communication dated 20.06.2012 has been addressed to the Government for annulling the resolution of the BBMP is taken into consideration, would become one of the main aspects to consider the manner in which the parties have acted on this aspect of the matter.
12. As noticed, the resolution of the BBMP Council was placed before the Commissioner on 25.04.2011. It was open for the Commissioner at that stage itself to put up appropriate note as to why the resolution of the BBMP Council cannot be accepted and it would have been open at that stage itself to refer the 15 matter to the Government, if the intention was so. However, as already noticed, the file had been put up for further process as if the resolution of the BBMP Council had been accepted by the Commissioner which had resulted in the petitioner being made to alter his position by acting upon the assurance. But, the subsequent file to consider and refer the same to the Government for further action appears to have been subsequently opened only in the year 2012 and the communication was addressed on 20.06.2012 i.e., more than one year from the date on which the Commissioner had knowledge of the resolution of the BBMP Council. Furthermore what requires to be noticed is that on the Commissioner having routed the file to the Joint Commissioner (Advertisement), who even according to the first respondent, is the authorized person with regard to the advertisement and gantries, had taken note of the same and had placed it before the Engineer in charge for further action in the matter after spot inspection.
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13. The above noticed process would disclose that the further action with regard to permitting the installation of the gantries had been taken up with the consent of the Joint Commissioner (Advertisement). Subsequent thereto, the spot inspection has been conducted and the note sheet at Note No.219 would indicate that the Chief Engineer before whom the file had been placed, has referred to the resolution dated 29.03.2011 of the BBMP Council and the Chief Engineer who is the superior to the second respondent herein has placed the file for further action relating to the resolution dated 29.03.2011. It is in that context, the file has thereafter been considered and the second respondent/Executive Engineer has taken further steps in the matter with the knowledge of his superiors and has ultimately placed the file for consideration. Note No.249 would refer to the location of the gantries to be made as per the earlier note by which such approval had been granted. These aspects of the matter would indicate that at this juncture, it would not be open for the Commissioner to plead ignorance as if the second 17 respondent has proceeded with the matter further without the knowledge of the Commissioner or the Joint Commissioner (Advertisement) and as if the agreement has been entered into unauthorisedly.
14. The very fact that the Commissioner has placed the file before the Joint Commissioner (Advertisement) after the resolution of the BBMP Council for further action in the matter and thereafter the file was routed and ultimately the agreement was entered into, and also considering the fact that pursuant to the agreement, the petitioner has been permitted to undertake the work would indicate that the other officials of the BBMP who are superior to the second respondent did not raise an issue till the work was completed. In that regard, the photographs which are produced along with the writ petition at Annexures- Q to W would indicate that the work in relation to gantries has been completed by the petitioner involving huge expenditure and the sign posts are in existence. This aspect of the matter has to be kept in view to 18 consider the fact that the action of the respondents has made the petitioner to alter his position in this regard. Therefore, in that view if the decision of the Hon'ble Supreme Court relied on by the learned counsel for the petitioner in the case of M/s. Motilal Padampat Sugar Mills Co.Ltd vs. State of Uttar Pradesh and Ors [(1979)2 SCC 409] is kept in view, the manner in which the petitioner has been made to alter his position and incur expenses where the Commissioner was also aware of these aspects of the matter would lead to the conclusion that the petitioner cannot be prejudiced at this juncture by contending that the second respondent was not authorized in terms of Section 67 of the Act, when all these proceedings indicate that the second respondent has not independently acted, but has only carried out the orders of the superiors when the file was routed to him from his superior and that too for the implementation of the order which had been passed by the standing committee and had been approved by the BBMP Council. The decision of the standing committee and the BBMP Council holds the field even as on this 19 day and has not been annulled or suspended as per law.
15. It would have been another matter if the Commissioner had immediately brought this to the notice of the Principal Secretary to the Government to consider the validity or otherwise of the resolution passed by the BBMP Council instead of routing it for further action. When the reference itself has taken more than one year, that too after the petitioner approached this Court in these petitions and the petitioner was made to believe that the same has been implemented and he has been permitted to undertake the work, the subsequent reference to the Government cannot be a contention to be accepted that the resolution of the BBMP Council was not liable to be acted upon. Further, in that direction itself, the reliance placed by the learned counsel for the first respondent on the communication dated 17.03.2012 (Annexure-R5) that subsequent decisions have been taken by the BBMP to modify the bye laws relating to 20 the advertisements so as to prevent such advertisements also would not be of any assistance. In fact, in the above referred decision itself, the Hon'ble Supreme Court has said that the change of policy subsequently should not affect the earlier position.
16. The further question that arises for consideration is with regard to the manner in which the work has been assigned since it is contended at this stage that it could have been entrusted only by way of tender notification after calling for competitive bids. It is in that context, the proposed respondent which is an association of the out-door advertising companies has filed IA-I/2012 to get themselves impleaded inasmuch as they are contending that the work could not have been assigned to one agency without there being tender notification. The first respondent has also taken up the said contention in the instant petition. Hence, this aspect of the matter in any event could be examined keeping in view the position arising in the instant matter and the lis between the parties to the petition. 21 Therefore, I am of the opinion that so far as the impleadment as sought under the application in IA- I/2012, the party therein would not be a necessary party for the purpose of determination of the instant petition and as such, the application would not be sustainable and is liable to be rejected. If at all the proposed respondent had any grievance, it could have been ventilated by the proposed respondent in an appropriate proceeding in accordance with law and not in the instant petitions.
17. On that aspect, the learned counsel for the first respondent would contend that the Hon'ble Supreme Court in the case of Nagar Nigam vs. Alfaheem Meat Exports (P) Ltd [(2006)13 SCC 382] and the decision in the case of Tata Cellular. vs. Union of India [(1994)6 SCC 651] has held that the Government contracts and tenders can only be by way of public auction and the states largesse cannot be distributed by private contracts. Having noticed the said decisions in detail, the position as enunciated by 22 the Hon'ble Supreme Court certainly holds the field and there can be no dispute whatsoever with regard to the fact that the Government contracts will have to be done in a transparent manner and even otherwise, the Karnataka Transparency Act provides for the transparent procedure to be followed in respect of certain contracts. On the other hand, the learned counsel for the petitioner would seek to place reliance on an unreported judgment of a Division Bench of this Court to which I was a member to contend that even in that light, the procedure followed in similar contract by private negotiation is approved therein. In that decision, in W.P.No.247/2006 disposed of on 19.04.2011 this Court had approved the contract entered into by the BBMP for construction of 'foot over- bridges' in favour of the fourth respondent therein which was an advertising company. It was therefore contended by the learned counsel for the petitioner that insofar as the public-private participation in creation of infrastructure and when the work is carried out by a private party for creating infrastructure where the 23 BBMP does not incur the expenses and when it is on BOT basis, such procedure could be followed and it is not necessary that it should be only by way of tender notification.
18. Having perused the judgment of the Division Bench of this Court, I see no reason to fully agree with the learned counsel for the petitioner to consider the same as a proposition of law to be applied to all cases. In the said case, it was in a situation where the notifications which had been published earlier on three occasions had not received any response from interested parties and it is in that circumstance, the BBMP had entered into the contract with the fourth respondent therein on private negotiation. In such circumstance, where the work had already been completed pursuant thereto and the issue had been raised in a public interest petition by an individual, this Court was of the view that the same does not call for interference in the facts of the said case. Therefore, the said decision cannot be considered as a declaration of law, but could 24 be noticed only for the purpose when it is applicable on the facts as already noticed above. The decision of the Hon'ble Supreme Court is clear on the aspect that it can be by tender.
19. Yet, I find certain distinguishing features herein. The facts in the instant case is not as if the work is being assigned as fresh work contract in favour of the petitioner by private negotiation without calling for tender. As already noticed above, in respect of the very issue, the parties have litigated earlier and there has also been proceedings before the BBMP Council. If this aspect of the matter is kept in view, in the instant case, the agreement for the first time was entered into between the petitioner and the BBMP as far back as on 08.11.2000. There is no material placed on record as to whether at that stage, the tender notification had been floated or otherwise and thereafter the agreement has been entered but the same is not an issue. However, the construction of the gantries and cantilever as agreed therein was not possible for several reasons which are 25 in fact indicated in the order dated 28.10.2010 passed by the Commissioner. The question is as to whether in such circumstance it is in the nature of extension though it is contended on behalf of the respondents that the extension provided in Section 443(10) of the Act in not permissible and this aspect had been stated by this Court in W.P.No.6473/2009. The facts in the said case would reveal that the petitioner therein had entered into an agreement pursuant to a short term tender notification dated 27.02.2009 and when a subsequent tender notification was floated, the petitioner therein was before this Court contending that he still had time up to 31.03.2009 and had also sought for extension. The tender notification which had been floated and assailed in the said petition had been withdrawn by the BBMP and therefore, that question did not arise for consideration and in such circumstance, the observation had been made.
20. In the instant case, the facts as have evolved from the stage of earlier petition when the petitioner was 26 before this Court in W.P.No.103/2010, the consideration was not in the nature of the extension of the contract in the manner as it arose earlier, but in the circumstance where the gantries were to be installed and was not permitted due to the work undertaken by the BDA, the fresh allotments of the places was sought and in that context, the contention was noted and this Court had directed the consideration of the case of the petitioner. Accordingly, the subsequent proceedings have followed. That apart, the earlier petition filed by the petitioner herein was not resisted on the ground that the case of the petitioner cannot be considered as there was no allotment by tender process. On the other hand, the direction issued therein to consider the case in the light of bye law 3.L.(ii) was accepted without appeal. All contentions should have been urged therein and it cannot be done piecemeal on different occasion by raising different contentions.
21. Therefore, in the said circumstance, where at an earlier point, the petitioner had succeeded and 27 subsequently the contract entered into was proceeded further and the petitioner had already installed the gantries involving expenses and altered their position, the situation would have to be looked at differently and cannot be considered one as having been awarded to the petitioner without following the process of calling for tenders. The said position would arise only after the intial period which has been agreed to be granted to the petitioner would expire. At this stage, when the petitioner has made investments pursuant to the manner in which the BBMP had proceeded further in the matter and the agreement was entered into, at this juncture, if the petitioner is not permitted to proceed further with the work only on the ground that at this juncture the tender notification had not been floated more particularly in a situation where there were several issues which had been taken place between the parties and they were also before this Court earlier, it would not be fair to a citizen who has been made to believe that his contract has been accepted and he has been permitted to invest for creating infrastructure. 28
22. However, what requires to be noticed is that the contract has been indicated for a period of 5 years which appears to be based on the resolution passed by the BBMP council accepting the decision of the standing committee indicating that the period would be for 5 years. But, the advertisement bye-law No.4A(xiv) as pointed out by the learned counsel for the first respondent would disclose that the contract could be entered into only for a maximum period of three years as indicated therein. Therefore, the present contract though entered into for a period of five years can only be for a period of three years and any permission granted to the petitioner to carry out advertisements on the other side of the gantries can only be for a period of three years and thereafter any fresh grant of permission can only be made in accordance with law. Further, the basis for ground rent imposed is not clear, it would certainly be open for the respondents to fix the appropriate ground rent as per law by indicating the basis for such fixation and call upon the petitioner to pay the same. That apart, the aforesaid discussion 29 would also indicate that one of the aspects which has overridden the conclusion is that the petitioner has been placed in a situation wherein he has altered his position by making investment and has already installed the gantries. That consideration can apply in respect of the seven gantries which have been installed by the petitioner and it cannot be the same with regard to the two gantries which have not been installed. Hence, there can be no order to provide alternate location for the two gantries which have not yet been installed.
23. In the result the following;
ORDER
(i) The writ petition is allowed in part.
(ii) The respondents are directed to issue 'No Objection Certificate' in respect of seven gantries as sought in Annexure-'O' to the petition and fix the advertisement tax in respect of the same within six weeks from date of receipt of a copy of this order.
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(iii) The respondents shall have the liberty of re-fixing the ground rent in accordance with law.
(iv) The prayer (ii) seeking direction to provide alternate locations in respect of two gantries is rejected.
(v) IA.No.1/2012 for impleading is rejected in terms of the observations made above.
(vi) Parties to bear their own costs.
Sd/-
JUDGE
Akc/bms