Andhra Pradesh High Court - Amravati
The Visakhapatnam Port Trust vs The Andhra Petrochemicals Limited on 3 November, 2025
IN THE HIGH COURT OF ANDHRA PRADESH Bench
APHC010149502022
Sr.No:-55
AT AMARAVATI [3483]
WRIT APPEAL NO: 688 of 2022
The Visakhapatnam Port Trust and others ...Appellants
Vs.
The Andhra Petrochemicals Limited and others ...Respondents
**********
Advocate for Appellants: Mr. P. Sri Raghu Ram, Ld. Senior
Counsel appearing vice Mr. Raviteja
Padiri
Advocate for Respondents: Sri N. Subba Rao, Ld. Senior Counsel
representing CKR Associates.
CORAM: THE CHIEF JUSTICE DHIRAJ SINGH THAKUR
SRI JUSTICE RAVI CHEEMALAPATI
DATE: 03.11.2025
Per DHIRAJ SINGH THAKUR, CJ:
The present Writ Appeal under Clause 15 of the Letters Patent has
been preferred against judgment and order dated 25.02.2022 passed in
W.P.No.16057 of 2020. The learned Single Judge by virtue of the judgment
and order impugned, while allowing the Writ Petition set aside the order dated
18.08.2020, cancelling the tender notification dated 07.08.2019 in which the
petitioner was a sole bidder as also set aside the fresh tender notification
dated 24.08.2020, with a further direction to execute the lease deed in favour
of the petitioner No.1 - respondent No.1 herein.
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Briefly stated the material facts are as under:
2. The petitioner No.1 is a Company which is engaged in the business of
manufacture and production of OXO-ALCOHOLS. It entered into a Lease
Agreement dated 27.06.1989, for setting up a Petro Chemical Industry over
land measuring Acs.75.00 cents and the lease was to extend over a period of
30 years. The lease was to expire in the year 2019 and did not contain any
automatic renewal clause. However, the existing lessee in terms of Clause
16(3) of the Land Policy Guidelines of 2014 for Major Ports (for short, "the
Guidelines of 2014") was entitled to the right of first refusal when the said
parcel of land was required to be auctioned on the expiry of the existing lease
period.
3. Since the lease in favour of the petitioner Company would expire in the
year 2019, the Visakhapatnam Port Trust Authority issued an NIT dated
07.08.2019, inviting bids from eligible parties for grant of a long term lease of
30 years without any clause for renewal, for a plot measuring 3,03,515 Sq.
Meters "for Industrial Purpose" at Visakhapatnam Port.
4. The petitioner Company, considering itself eligible, submitted its bid and
was a sole bidder. The bid of the petitioner in two bid system was found to be
responsive. According to the petitioner, the web portal of the Port Trust
Authority showed the status of the financial bid of the petitioner as "opened"
and the bid status as "accepted". According to the petitioner, the rental which
was payable in regard to the subject property was Rs.7,25,40,085/- per year.
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5. Notwithstanding the fact that the status of the petitioner‟s bid was
shown as accepted, the case of the petitioner was that, certain information
was sought from the petitioner by the appellant regarding the industrial
process, the raw material used and the finished product of the petitioner‟s
industry. The petitioner‟s case is that the requisite information as sought was
furnished to the appellant Port Authority and was willing to execute the lease
deed with them, apart from paying the lease rental and the security deposit,
however, no response was elicited from the respondents in that regard.
6. The petitioner‟s case is that vide letter dated 18.08.2020, the petitioner
was informed regarding the cancellation of the tendering process in the
following words:
"In this regard it is to inform that for various reasons the
tender has been cancelled.
Therefore the DD submitted by you toward EMD amount
for the subject tender is returned herewith."
7. Apart from cancelling the tender, a fresh process was initiated on
24.08.2020 and this time bids were invited from eligible bidders for allotment
of the property in question, on long term lease of 30 years for "commercial
purpose".
8. The difference in the tendering process being that whereas the initial
bids were invited in regard to land use which was for „industrial purpose‟, the
subsequent NIT was meant for „commercial purpose‟.
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9. The action of the Port Trust Authority in cancelling the tender process
earlier initiated vide NIT dated 07.08.2019 and issuing subsequent NIT dated
24.08.2020, came to be challenged before the learned Single Judge firstly on
the ground that it was a non-speaking order which did not provide any reasons
as to why the tendering process initially initiated was cancelled and further
that no notice had been issued nor any opportunity given to the petitioner by
the Port Trust Authorities to submit its response before cancellation and hence
the petitioner claimed that the action of the respondents - appellants herein
was arbitrary and in violation of principles of natural justice.
Secondly, on the ground that the Port Trust Authorities had given a go
by to the mandatory requirements as stipulated in Clauses 13 and 20 (iv) of
the Land Policy Guidelines for Major Ports, 2014, and inasmuch as the Port
Trust Authorities had failed to show that they had invited objections and
suggestions from the stakeholders before the change of land use from
„Industrial‟ to „Commercial‟.
It was also the case of the petitioner Company that the subject property
could not be leased out for commercial purposes as the said property was
classified under Zone 4, which according to the Land Use Plan prepared
under the Guidelines of 2014 had been classified to be used only for industrial
purposes.
10. By virtue of the judgment and order impugned, the Writ Petition filed by
the petitioner Company was allowed, by holding inter alia that the unilaterally
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cancelling the tender notification issued earlier, without affording any
opportunity of being heard to the petitioner, violated the principles of natural
justice and that an opportunity of hearing ought to have been given and that it
was necessary on the part of the Port Trust Authority to serve a notice and
afford an opportunity to the petitioner of being heard.
11. The learned Single Judge further held that the Port Trust Authority could
not have unilaterally changed the Land Use of the subject property from
Industrial to Commercial, without following due process in terms of the
Guidelines of 2014, which required that any change of Land Use Plan be
preceded by publication in the website of the Port Trust, and only after inviting
objections and suggestions could be finalized by the Board of Trustees of the
Port Trust Authority and issued directions to execute the Lease Deed in favour
of the petitioner.
Legal Position:
12. The Parliament enacted the Major Port Trusts Act, 1963, to make
provision for the Constitution of the Port Authorities for certain major ports in
India and to vest the administration, control and management of such ports in
such authorities as also for matters connected therewith.
13. The said Act, however, was repealed by the Major Port Authorities Act,
2021, which came into force with effect from 03.11.2021. Notwithstanding the
fact that the Act of 2021, repeals the Act of 1963, yet, in terms of Section 75 of
the Act of 2021, pertaining to Repeal and Savings, anything done primarily by
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the Board of Trustees and Tariff Authority for Major Ports under the Act of
1963 in respect of inter alia any order or resolution or direction would be
deemed to have been taken under corresponding provisions of the Act of
2021.
14. Since the impugned action of the Port Trust Authority was at a time
when the provisions of the Act of 1963 were in force, it would be apt to refer to
some of the provisions of the said Act.
Section 3 of the Act of 1963 envisages constitution of a Board of
Trustees in respect of a major port, which consists of Chairman and Deputy
Chairman to be appointed by the Central Government and not more than 17
persons in the case of a port, other than the Ports of Bombay, Calcutta and
Madras.
Section 33 of the Act envisages that the Board shall be competent to
enter into and perform any contract necessary for the performance of its
function under the Act.
Section 34 deals with mode of executing contracts on behalf of the
Board.
Second proviso to Section 34 inter alia envisages that no contract for
acquisition, sale or lease of any immovable property shall be entered into for a
term exceeding 30 years.
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Section 111 envisages that the Tariff Authority as also the Board in the
discharge of its function under the Act shall be bound by such directions on
questions of policy as the Central Government may give in writing from time to
time and further that the decision of the Central Government whether a
question is one of policy or not shall be final.
In furtherance of the provisions of Section 111, the Central Government
framed the Policy Guidelines for Land Management by Major Ports of 2014.
15. The main object of the policy as can be culled out on a reading of the
policy was to ensure that the land resource belonging to the Port Authority
was to be put to optimum use as per the approved Land Use Plan with focus
on retaining/attracting port traffic as also to ensure that optimum value was
realized by licensing/leasing port land through a transparent tender-cum-
auction methodology.
16. The policy was framed to regulate allotment of land as it was
considered to be an important resource for the Port Trust. Clause 13 of the
policy envisages preparation of a Land Use Plan covering all the land owned
or managed by the Port, which are required then to be approved by the Board.
Clause 13 for facility of reference is reproduced hereunder:
"13. Land Use Plan:
Every Major Port shall have a Land use plan covering all the
land owned and/or managed by the Port. Such plans shall be
approved by the Board and a copy would be forwarded to the
Government. Any proposal for revision of land use plan shall be
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finalized by the Board only after considering the objections and
suggestions received from the various stakeholders. Land use
plan of major ports shall be reviewed by the Board at least once
in every five years."
17. Needless to say that whereas the need to place the prepared land use
in public domain was referable to the Land Management Policy Guidelines of
2014, which may still continue to hold the field inasmuch as Section 111 of the
1963 Act envisaged the Tariff Authority as also the Board of the Port Trust to
discharge its functions under the Act to be bound by the directions on
questions of policy of the Central Government.
Even as per the first proviso to Section 22(2) of the Act of 2021, it is
provided specifically that the "period and the manner of lease of land or
immovable property for port related use and non-port related use shall be in
such manner as my be prescribed."
Issue for Consideration:
18. The issue that arises for consideration is whether the petitioner being a
sole bidder acquired any right to have the auction concluded in its favour and
whether the decision of the Board of the Port Trust Authority to cancel the
auction process could be said to be arbitrary or not?
Terms and Conditions of the NIT:
19. According to the NIT, dated 07.08.2019, applications were invited from
eligible companies for allotment of land on annual lease rental basis for 30
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years, a plot of land falling in Zone 4 measuring 3,03,515 square meters at
Exim Park area for industrial purpose.
According to Clause 1.41, which pertains to Acceptance of Tender, it
was made clear that Visakhapatnam Port Trust would not be bound to accept
the highest lease fees offered in the bid and that the Visakhapatnam Port
Trust reserved its right to accept or reject without assigning any reasons
whatsoever.
Clause 1.59 of the tender document envisages as under:
"1.59 VPT reserves the right to accept any tender or reject any or
all tenders or annul this tendering process without assigning any
reason and liability whatsoever and to re-invite the tender at its
sole discretion. VPT Board will consider & approve the tender
document, pre-bid clarifications, short listing of bidders and
selection of successful bidder."
Clause 2.20 of the tender document dealt with Lease Execution which
envisaged the issuance of Pre-acceptance Letter to the successful Bidder(s),
and the successful Bidder was then required to remit the lease rentals and the
security deposit amount along with the applicable taxes within 14 days from
the date of issuance of the Pre-acceptance Letter by the Visakhapatnam Port
Trust. For purposes of reference, Clause 2.20 is reproduced hereunder:
"2.20 LEASE EXECUTION
The allotment of Land is for the purpose of 'Industrial in Visal
napatnam Port Area'. After evaluation of the technical bids and
opening of CO IMERCIAL BID Visakhapatnam Port Trust will
issue a Pre-acceptance Letter to the successful Bidder(s). The
successful Bidder shall, within 14 days from the date of issue of
the Pre-Acceptance letters by Visakhapatnam Port Trust, remit the
lease rentals and security deposit amount along with the
applicable taxes (1.e., on year rent as advance and another two
years rent as refundable security deposit and
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G.S.T(SGST(9%)+CGST(9%)) at the rate as applicable time to
tire), (fails to do so the allotment will be liable to be cancelled and
their EMD will be forfeited without any notice). Upon the receipt of
the premium amount, Visakhapatnam Port Trust will issue a letters
of Allotment. The possession of the Lands will be effected only
after the execution of the lease deeds/agreement which will have
to be executed within two weeks from the date of issue of letters
of allotment failing which the allotment will be liable to be canceled
and total premium already paid, EMD & Security Deposit
forfeited."
20. A reading of the aforementioned clause would also make it clear that it
was only after the issuance of a Pre-acceptance Letter to the successful
Bidder, the deposit of the lease rentals as also the security deposit amount
with applicable taxes that the Visakhapatnam Port Trust would issue a Letter
of Allotment which would be followed by the execution of Lease Deed and
only thereafter the possession of the land would be handed over to the
successful Bidder.
21. In the instant case, the Visakhapatnam Port Trust Authorities did not
issue any Pre-acceptance Letter to the petitioner, much less did the petitioner
deposit the lease rental or for that matter the security deposit amount. The
Visakhapatnam Port Trust Authorities also did not issue any Letter of
Allotment in favour of the petitioner, this would have been done only if the
previous condition that is the VPT Board had considered and approved the
tender documents, pre-bid clarifications as also approved the selection of the
successful Bidder.
22. It is settled law that highest bidder does not acquire any right. The
scope of judicial review in issues relating to award of contracts by the State or
its instrumentalities is no longer res integra. In Tata Cellular vs. Union of
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India1, it was held that principles of judicial review would apply to the exercise
of contractual powers by Government bodies in order to prevent arbitrariness
or favouritism. However, there were limitations which were inherent in
exercise of that power. The right to refuse the lowest bid, it was held was
always available to the Government but the principle laid down in Article 14 of
the Constitution had to be kept in view while accepting or refusing a tender
and further that there would be no question of infringement of Article 14, if the
Government tried to get the best person or the best quotation. The right to
choose cannot be considered to be an arbitrary power, unless of course the
said power was exercised for any collateral purpose, in which case that power
would be struck down. In paragraphs 74 and 77, the Apex Court in the
judgment supra held as under:
"74. Judicial review is concerned with reviewing not the merits of
the decision in support of which the application for judicial review
is made, but the decision-making process itself.
77. The duty of the court is to confine itself to the question of
legality. Its concern should be :
1. Whether a decision-making authority exceeded its powers?
2. Committed an error of law,
3. committed a breach of the rules of natural justice,
4. reached a decision which no reasonable tribunal would have
reached or,
5. abused its powers."
23. The scope of judicial review in matters relating to award of contracts
also came up for consideration before the Apex Court in Maa Binda Express
1
(1994) 6 SCC 651
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Carrier vs. North-East Frontier Railway 2 , it was held that the bidders
participating in the tender process had no right to claim that the tenders be
accepted simply because the tender was the highest or the lowest, it was
held:
"8. The scope of judicial review in matters relating to award of
contract by the State and its instrumentalities is settled by a long
line of decisions of this Court. While these decisions clearly
recognize that power exercised by the Government and its
instrumentalities in regard to allotment of contract is subject to
judicial review at the instance of an aggrieved party, submission of
a tender in response to a notice inviting such tenders is no more
than making an offer which the State or its agencies are under no
obligation to accept. The bidders participating in the tender
process cannot, therefore, insist that their tenders should be
accepted simply because a given tender is the highest or lowest
depending upon whether the contract is for sale of public property
or for execution of works on behalf of the Government. All that
participating bidders are entitled to is a fair, equal and non-
discriminatory treatment in the matter of evaluation of their
tenders. It is also fairly well-settled that award of a contract is
essentially a commercial transaction which must be determined on
the basis of consideration that are relevant to such commercial
decision. This implies that terms subject to which tenders are
invited are not open to the judicial scrutiny unless it is found that
the same have been tailor made to benefit any particular tenderer
or class of tenderers. So also the authority inviting tenders can
enter into negotiations or grant relaxation for bona fide and cogent
reasons provided such relaxation is permissible under the terms
governing the tender process."
24. In Shimnit Utsch India (P) Ltd. Vs. West Bengal Transport
Infrastructure Development Corporation3, the Apex Court held:
"64. It is true that the State or its tendering authority is bound to
give effect to essential conditions of eligibility stated in a tender
document and is not entitled to waive such conditions but that
does not take away its administrative discretion to cancel the
entire tender process in public interest provided such action is not
actuated with ulterior motive or is otherwise not vitiated by any
vice of arbitrariness or irrationality or in violation of some statutory
provisions. It is always open to the State to give effect to new
2
(2014) 3 SCC 760
3
(2010) 6 SCC 303
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policy which it wished to pursue keeping in view `overriding public
interest' and subject to principles of Wednesbury reasonableness."
25. In Rishi Kiran Logistics (P) Ltd. Vs. Kandla Port Trust4, the Apex
Court was considering whether in exercise of its power of judicial review, the
Court could sit over the decision of a public body when it decides that it need
not go further ahead with the tender process. It was held that if the decision
was taken without any reasons to support such a decision, then it was based
upon mere ipse dixit, it would be arbitrary.
26. With a view to understand as to whether in the instant case the decision
to cancel the tender process taken by the Port Trust Authority was arbitrary or
actuated by mala fides or not, we have been shown relevant record which was
filed by way of additional material papers. It can be seen from the material that
a single bid which was submitted by the petitioner was received and
evaluated, and finally the said committee recommended the acceptance of the
proposal of the petitioner for purposes of allotment of the land on long-term
annual rental basis for a period of 30 years.
27. The tender committee submitted and requested the Chairman,
Visakhapatnam Port Trust, to place the same before the Visakhapatnam Port
Trust Board. The Chairman as is evident from the note dated 11.12.2019,
sought information as to what the sole bidder was manufacturing and whether
it was a commercial activity.
4
(2010) 6 SCC 303
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28. The query was answered to suggest that the petitioner - Andhra
Petrochemicals Limited was a manufacturing unit having license under the
Factories Act and was an industrial unit and therefore, could be charged only
industrial rate. From the record, it appears that the Chairman on 17.12.2019,
recorded as under:
"Are they using any of our port facilities like berth/tug/wharfage
etc., then they are doing port related activities, but it is not clear
from the office note what is industrial activity and commercial
activity in port parlance."
29. In response to the said query, the reply was submitted as under:
"Reply: M/s Andhra Petro chemicals Ltd is not directly using our
port facilities as there are taking raw materials used by them
i.e., Naphtha and propylene from Hindustan Petroleum
Corporation Ltd which are by products produced by crude oil
distillation.
The crude oil being imported by M/s HPCL and M/s
HPCL using port facilities for handling crude oil. Hence the
volume of naphtha, i.e., used by APCL is definitely included in
the crude oil volume of HPCL, Hence APCL is indirectly used
our port.
In VPT only petroleum outlets, shops selling goods, Ice
selling units in fishing harbour are treated as commercial and
land being allotted.
All other industries like, HPCL, ESSAR, Coromandel
International, Alufluoride, IOCL, RCII are treated as industrial
units only."
30. In reply to the aforementioned response of the port authorities, the
Chairman records as under:
"But other units like HPCL/ESSAR/Coromandel/IOCL
are using our berth facilities in some form or the other, hence
industrial. Andhra Petro not using our port facilities then why
industrial. We may charge commercial rent because the land is
used for commercial purpose only, now the lease is expired we
have three categories of land use
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industrial/commercial/residential. The land is being used for
commercial purpose so commercial rate shall be charged."
Finally, on 08.07.2020, the Chairman records as under:
"The objective of land policy is mainly to optimally utilize
the land for attracting port traffic and maximum revenue
generation for the port. In this particular case, the firm is not
using any of our port facilities and only using our land for
processing raw materials and selling the final product in the
market, if they use any of our port facilities, we would have got
wharfage, tug charges and other revenues, but this particular
one was commercial operation. Since land is very limited and
we do not have any land bank, now in the interest of port, we
must go for commercial rent; Since lockdown is over we may go
ahead."
31. It appears that after the noting recorded on 08.07.2020, the petitioner
was informed vide letter, dated 18.08.2020, regarding the cancellation of the
tendering process in terms, which have been reproduced in paragraph No.6
hereinabove.
32. By virtue of our order, dated 14.10.2025, we required the VPT to verify
and respond on the aspect as to whether the decision of the Chairman to
demand commercial rate of rent in regard to the parcel of land in question was
required to be ratified or placed before the Board and whether the requisite
action was done or undertaken.
33. The memo filed, however, is conspicuously silent on the issue as to
whether the decision to charge commercial rate of rent was ever placed
before the Board for its ratification. If that be so, then the decision to invite
fresh tenders for the said plot situate in an Industrial Zone 4 would even
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otherwise be unsustainable, as no fresh tenders could be invited without first
seeking a ratification by the Board in that regard.
The action in issuing a fresh notification, dated 24.08.2020, in our
opinion, therefore, cannot be supported on that ground also.
34. Apart from this, although an effort has been made by learned counsel
for the appellants to suggest that the Master Plan prepared in the year 2025,
draws a distinction between port related activity and non-port related activity,
yet, in our opinion, the said preparation of Master Plan is not at all relevant, as
we are testing the decision taken as early as in the year 2019. Even
otherwise, the sad Master Plan, does not at all declare an industrial activity
which is non-port related, to be a commercial activity. We cannot forget the
fact that Zone 4, in which the industrial unit was set up by the petitioner
continues to remain as an industrial zone till date.
35. Assuming that the industry is non-port related, yet, there is no murmur
in the Master Plan prepared even in 2025, which would either authorize the
port authorities to charge or make liable the industry engaged in non-port
related industrial activity to pay lease money at a commercial rate.
36. It would also be pertinent to make a reference to Clause 6.4 of the
Master Plan of 2025, which defines Zone-4 and Zone-5 as being located
outside of the port operation area. Not only this, the said land is envisaged to
be used for industrial purpose. If the industrial area is located outside the port
operation area, then without there being any specific provision which could
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otherwise authorize the port authorities to charge a commercial rate from the
Unit such as the petitioner, the commercial rate, in our opinion, cannot be
charged assuming the Port authorities were to insist on it even today.
37. It is, therefore, clear that only because an industrial activity was non-
port related, would not render it a commercial activity.
At this stage, it would be pertinent to refer to definitions as to what is
commercial and what is industrial.
The Apex Court in the case of M.P. Electricity Board Vs. Shiv
Narayan5 held:
"The expression "commerce" or "commercial" necessarily has a
concept of a trading activity. Trading activity may involve any kind of activity,
be it a transport or supply of goods. Generic term for almost all aspects is
buying and selling. But in legal profession, there is no such kind of buying or
selling nor any trading of any kind whatsoever. Therefore, to compare legal
profession with that of trade and business is a far from correct approach and
it will totally be misplaced."
In Laxmi Engineering Works Vs. P.S.G. Industrial Institute 6 , the
Apex Court held:
"11. ....... In the absence of a definition, we have to go by its ordinary
meaning. 'Commercial' denotes "pertaining to commerce" (Chamber's
Twentieth Century Dictionary); it means "connected with, or engaged in
commerce; mercantile; having profit as the main aim" (Collins English
Dictionary) whereas the word 'commerce' means "financial transactions
5
(2005) 7 SCC 283
6
(1995) 3 SCC 583
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especially buying and selling of merchandise, on a large scale" (Concise
Oxford Dictionary)."
In ITC Limited Vs. State of U.P.7, the Apex Court held that the term
„industry‟ had different nuances. The traditional meaning of „industry‟ may be
manufacture or production of goods. When used in the context of „an
industrial area‟ or „a land for industrial use‟ the word „industry‟ would refer to
use for manufacture, production and allied activities.
38. On a plain reading of the definitions supra, it thus becomes clear that a
commercial activity can never be placed at par with industrial activity and
therefore, a commercial rate cannot be charged from an industrial unit unless
and until it was specifically permitted by changing the Land Use Plan by
following due process in terms of the Guidelines of 2014, which require that
any change of Land Use Plan will be preceded by publication in the website of
Port Trust and only after inviting of objections and suggestions from the
Stakeholders.
39. Since the Land Use Plan did not specifically authorize the VPT to
charge a commercial rate for an industrial unit situate in an industrial zone,
the decision to invite fresh bids from eligible bidders for purposes of allotment
of the land for commercial purpose, which was otherwise in occupation of the
petitioner unit, was without any authority of law and therefore unsustainable.
7
(2011) 7 SCC 493
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40. Having said so, while we are clear that the port authorities could not
have issued a fresh tender notification inviting bids for the land in question for
a commercial purpose without changing the Land Use Plan in accordance
with the procedure prescribed under the Land Use Policy of 2014 as on the
relevant date, we cannot deny the VPT its right to change the policy to provide
for change of land use from „industrial‟ to „commercial‟ and to categorize a
non-port related industrial activity to be a commercial activity for the purpose
of lease rental.
41. We have already made a reference to the judgment of the Apex Court
in the case of Shimnit Utsch India (P) Ltd. Vs. West Bengal Transport
Infrastructure Development Corporation, which does recognize the
principle that it was open to the State to give effect to new policy which it
wished to pursue keeping in view „overriding public interest' and subject to
principles of „Wednesbury reasonableness‟.
42. In the present case, the entire intention behind cancellation of the
earlier tendering process by the VPT authorities was to garner more revenue
from entities which had set up base in their industrial zone which were
unrelated to the basic port related activities and therefore wished to
encourage only those which would use their port facilities, so that more
revenue would be flowing into the coffers of the port authorities.
43. Be that as it may, the decision to invite fresh bids vide the notification,
dated 24.08.2020, is unsustainable for the reason that inviting bids for a plot
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of land to be used for commercial purpose was not supported by the change
of Land Use Plan, which ought to have been done in accordance with the
Land Use Policy of 2014. The Master Plan prepared in the year, 2025, would
not support even on date, the action to allot the plot in question for
commercial purposes, as the said Master Plan of 2025 does not specifically
authorize the appellants to initiate such an action without properly changing
the land use and tweaking the policy to that extent.
a. We hold that the petitioner - respondent No.1 herein had no
indefeasible right to claim the execution of Lease Deed in its favour, as the
contract had not been concluded between the petitioner and the appellants
and it was within the right of the appellant to abandon or cancel the entire
tendering process, which we have already stated was taken on account of
genuine concern to rake in more revenue only and not for any mala fide
reasons and further, we hold that there was no need to afford an opportunity
of being heard to the petitioner before cancelling the tendering process.
b. In view of the above, the direction to execute the Lease Deed in
favour of the petitioner is unsustainable and is accordingly set aside. We give
liberty to the appellant to proceed to amend their Master Plan and change
their Land Use Policy to bring it in consonance with the Land Use Policy of
2014 and the provisions of the Act of 2021, if they are so advised and till such
time it is done, the petitioner would be permitted to continue with its industrial
activity on the land in question, unless of course the VPT authorities decide to
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HCJ & RCJ
WA_688_2022
continue with the existing Land Use Policy and to allot it only for industrial
purpose in future on lease rental fixed for industrial units, subject to a fair
bidding process, by issuance of a notification in that regard, in which process
the petitioner would be eligible to participate.
44. Accordingly, this Writ Appeal is, disposed of.
Consequently, pending miscellaneous applications, if any, in this case,
shall stand closed. No costs.
DHIRAJ SINGH THAKUR, CJ.
RAVI CHEEMALAPATI, J.
SSN / KBS