Bombay High Court
Sunshine Paptech Pvt Ltd vs Union Of India And 2 Others on 4 August, 2017
Bench: Anoop V. Mohta
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION (LODGING) NO. 1192 OF 2017
1 Maharashtra Heavy Vehicle
and Interstate Container Operators
Association.
An association established
in 1996 for transporters of
heavy goods and
Import/Export Containers in
Maharashtra and interstate
having its registered office at
Office No.112, B-1, Building,
Wadala ruck Terminal, Anik
Road, Mumbai-400037.
2 John Oswald Cordiera,
Aged 49 years, is an
individual and the member of
Maharashtra Heavy Vehicle and
Interstate Container
Operators Association and
doing the business of
transportation through
Shepards Transport Services
having its registered address
D-325, Neelkanth Business Park,
Station Road, VidyaVihar,
Mumbai.
Vs.
1 Union of India,
Through the Secretary,
Ministry of Shipping,
Department of Transport,
Parivahan Bhavan, 1,
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Parliament Street,
New Delhi-110 001.
2 The Chairman,
Jawaharlal Nehru Port Trust,
having its office at Administrative
Building, Nhava Sheva,
Taluka Uran, District
Raigad, Maharashtra-400 707. ....Respondents.
WITH
WRIT PETITION (LODGING) NO. 1626 OF 2017
Sunshine Paptech Pvt. Ltd.
having its office at 375-379,
WADA, Sahapur Road, Abhitghar
Wada, District Palghar,
Maharashtra. ....Petitioner.
Vs.
1 Union of India,
Through the Secretary,
Ministry of Shipping,
Department of Transport,
Parivahan Bhavan, 1,
Parliament Street,
New Delhi-110 001.
2 The Chairman,
Jawaharlal Nehru Port Trust,
having its registered office at
Administrative Building,
Nhava Sheva,
Taluka Uran, District
Raigad, Maharashtra-400 707.
3 Maharashtra Heavy Vehicle
and Interstate Container Operators
2/60
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Association.
An association established
in 1996 for transporters of
heavy goods and
Import/Export Containers in
Maharashtra and interstate
having its registered office at
Office No.112, B-1, Building,
Wadala Truck Terminal, Anik
Road, Mumbai-400037. ....Respondents.
Mr. Sujay Kantawala a/w Ms. Shilpi Jain Mr. Ashish Mehta i/by Ashish
Mehta for the Petitioner in WPL No. 1192 of 2017 and for Respondent
No.3 in WPL 1626 of 2017.
Mr. Rohan Rajadhyaksha a/w Mr. Pratik Jhaveri i/by Pratik Jhaveri for
the Petitioner in WPL No. 1626 of 2017.
Mr. Vikram Nankani, Senior Advocate a/w Mr. Om Prakash Jha, Ms.
Surabhi Chatterjee, Mr. Raghav Shekhar i/by The Law Point for
Respondent No.2 in both the Petitions.
CORAM : ANOOP V. MOHTA AND
SMT. ANUJA PRABHUDESSAI, JJ.
RESERVED ON : 21 JULY 2017.
PRONOUNCED ON : 4 AUGUST 2017.
JUDGMENT (PER ANOOP V. MOHTA, J.):-
In view of the urgency so expressed, rule made returnable
forthwith. Heard finally by consent.
2 The common issues are involved, so also the prayers and
the Respondents, therefore, this Judgment.
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3 Petitioner No.1 in WPL No. 1192 of 2017, is an Association
of more than 450 transporters as members handling 76% of the
Import-Export to and from the Jawaharlal Nehru Port Trust (for short,
"JNPT") Port.
4 On 23 March 2017, Bid/Tender Notice issued by
Respondent No.2-JNPT for "selection of transporter for providing
transport solution for various identified routes for direct port delivery
ISO freight containers from the four terminals of JNPT", whereby the
JNPT under the Direct Port Delivery (DPD) Model intends to select a
panel of transporters with respect to five regions as earmarked by
them through the tender process. All the containers which are
required to be cleared before 48 hours under the DPD model shall be
diverted only to the selected five transporters. On 1 September 2008,
the Chief Commissioners of Customs, Nhava-Sheva issued a facility
Notice No. 63 of 2008 ("FN 63/2008") as per which DPD facility was
introduced for the first time as a facility to accredited importers, i.e.
the importers who fulfilled certain criteria as per the aforesaid facility
notice, as per which on payment of duty, containers were allowed to
be removed directly from the port itself without any examination as
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required under the Customs Act, 1962 (for short, "the Customs Act").
On 10 March 2008, Petitioner No.1 issued letter to Respondent No.2-
JNPT, appraising him about the Chaotic situation arisen at the port
due to the mismanagement of JNPT. On 7 December 2012, second
reminder letter was issued to Respondent-JNPT demanding
management issues should be looked at urgently. Various
correspondence kept on making the representation to Respondent-
JNPT citing the traffic congestion problems at the Port which either
were ignored or redressed with fake assurances.
5 During November 2016 to February 2017, the
Commissioner of Customs, Nhava Seva issued various public notices,
PN 161/16 and PN 180/16 as per which total of 778 importers were
identified who can avail DPD facility by relaxing the eligibility
requirements specified in FN 63/2008. Again on 12 April 2017,
Petitioner No.1 issued letter to Respondent-JNPT and tried to explain
the plight of the transporters and devastating effect if such tender is
allowed to Respondent No.2 and requested to withdraw the tender,
but that too was not responded. On 17 April 2017, Petitioner No.1
also made a representation to Respondent No.2 vide a presentation
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whereby certain suggestions were made for implementation of DPD
Model. The Petitioners themselves formulated four stages of
implementation plan taking into account all the ground level realities.
Inspite of the presentation made by the Petitioners on behalf of all the
members, Respondent-JNPT did not withdraw the tender notice.
Hence the present Petition.
6 In so far as WPL No. 1626 of 2017 is concerned, the
Petitioner is a Private Limited Company engaged in the business of
manufacturing Kraft papers and other allied products through the
process of recycling imported waste papers. The Petitioner has been
regularly importing 150-200 containers of waste paper per month at
NhavaSeva port for captive consumption in its plant for manufacturing
paper and other allied products as the timely availability of the waste
product is very much essential for sustaining the continuous running
of the plant as any disruption in supply may cause the shutdown of
plant. On 23 March 2017, Respondent-JNPT under DPD Model
intends to select a panel of transports with respect to five regions as
earmarked by them through the tender process and all the containers
which are required to be cleared before 48 hours under the DPD
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Model shall be diverted only to the selected five transporters. On
account of introduction of DPD a.k.a. DPD facility, the Import General
Manifest also indicates where a container is meant for DPD. An
Import Advance List ("IAL") is filed by the shipping line with the
terminal prior the berthing of the vessel. The importers who fulfilled
certain criterion on the basis on their tract record and reputation, with
minimum compliance under the Customs Act, as part of the Risk
Management System ("RMS") and on the basis of self-assessment
were allowed to take their goods directly to their factory premises
from the port terminal without it being diverted to Container Freight
Station (for short, "CFS"). Even as per FN No. 161/2016, it was
provided that if the DPD containers which are not cleared by the
importer within 48 hours of the arrival of the container, then such
container will be automatically transferred to the designated CFS,
speedy CFS. However, due to sudden increase in the number of DPD
importers from 50 to 681 i.e. from 3% to 17%, the port became all the
more congested. Hence this Petition.
7 Both the Petitioners have challenged tender/notice of
JNPT, Traffic Department dated 23 March 2017, "for selection of
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transporter for providing transport solution for various identified routes
for DPD, ISO freight containers from the four terminals of JNPT". By
amendments have challenged the policy decision.
8 In WPL No. 1192 of 2017, Contesting Respondent No.2-
JNPT has filed affidavit-in-reply dated 3 June 2017. The Petitioners
filed their affidavit-in-rejoinder on 20 June 2017.
In WPL No. 1626 of 2017, Contesting Respondent No.2-
JNPT has filed affidavit-in-reply dated 11 July 2017. This Court, on
27 April 2017, after hearing the learned counsel appearing for the
Petitioners and Respondent No.2-JNPT, directed Respondent No.2 not
to proceed further in respect to the tender in question till the next
date of hearing. The interim order, so granted, has been in force till
this date.
Judicial Review in New Policy decision:-
9 The law with regard to the contract/tender is quite settled.
The learned counsel appearing for the respective parties have read
and referred various Judgments of the Supreme Court and the High
Courts. Those are:-
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for the Petitioners' side:-
a) Tata Cellular Vs. Union of India1;
b) State of Bihar & Ors. Vs. Project Uchcha Vidya,
Sikshak Sangh & Ors.2;
c) Association of International Schools & Principals
Foundation & Anr. Vs. State of Maharashtra &
Anr.3;
d) Aurangabad Electrical Contractors Association,
Aurangabad, & Ors. Vs. State of Maharashtra4;
e) Bijoe Emmanuel & Ors. Vs. State of Kerala & ors.5
f) Gainda Ram & Ors. Vs. Municipal Corporation of
Delhi & Ors.6
g) B.P. Sharma Vs. Union of India & Ors.7
Respondents' side-
h) All Cargo Logistics & Ors. Vs. Union of India8;
i) JSW Infrastructure Limited & Anr. Vs. Kakinada
Seaports Limited & Ors.9
j) Reliance Telecom Limited & Anr. Vs. Union of India
& Anr.10
1 (1994) 6 SCC 651
2 (2006) 2 SCC 545
3 2010(6) Mh.L.J. 816
4 2015(1) Mh.L.J. 182
5 (1986) 3 SCC 615
6 (2010) 10 SCC 715
7 (2003) 7 SCC 309
8 (2017) SCC OnLine Bom. 2419
9 (2017) 4 SCC 170
10 (2017) 4 SCC 269
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k) Montecarlo Limited Vs. National Thermal Power
Corporation Limited11
l) Afcons Infrastructure Limited Vs. Nagpur Metro Rail
Corporation Limited & Anr.12
m) SKL Company Vs. Chief Commercial Officer,
Southern Railways & Ors.13;
10 The Apex Court in M/s. CRRC Corporation Ltd. Vs. Metro
Link Express for Gandhinagar & Ahmedabad (MEGA) Company
Ltd.14 has interpreted the tender conditions and the eligibility criteria
and set aside the High Court order-
"29 In Reliance Telecom Ltd. and another v. Union
of India and another, the Court referred to the
authority in Asia Foundation & Construction Ltd. v.
Trafalgar House Construction (I) Ltd. and others
wherein it has been observed that though the
principle of judicial review cannot be denied so far
as exercise of contractual powers of Government
bodies are concerned, but it is intended to prevent
arbitrariness or favouritism and it is exercised in the
larger public interest or if it is brought to the notice
of the court that in the matter of award of a
contract power has been exercised for any collateral
purpose."
11 (2016) 15 SCC 272
12 (2016) 16 SCC 818
13 (2015) 16 SCC 509
14 2017(6) SCALE 345
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11 The Supreme Court, while dealing with the requirement of
the State to take any new policy decision and/or in related
administrative action, has recorded in the judgment of Ekta Shakti
Foundation Vs. Government of NCT of Delhi15 that:-
11. "5 While exercising the power of judicial review of
administrative action, the Court is not the appellate authority
and
'[the Constitution does not permit the Court to
direct or advise the executive in matter of policy or
to sermonize any matter which under the
Constitution lies within the sphere of the
Legislature or the executive, provided these
authorities do not transgress their constitutional
limits or statutory power.
The scope of judicial enquiry is confined to the question
whether the decision taken by the Government is against any
statutory provisions or is violative of the fundamental rights of
the citizens or is opposed to the provisions of the Constitution.
Thus, the position is that even if the decision taken by the
Government does not appear to be agreeable to the Court it
cannot interfere.
6.
The correctness of the reasons which prompted the
Government in decision making, taking one course of action
instead of another is not a matter of concern in judicial review
and the Court is not the appropriate forum for such
investigation.
The policy decision must be left to the Government
as it alone can adopt (sic decide) which policy should be
adopted after considering all the points from different angles.
In matter of policy decisions or exercise of discretion by the
15 (2006) 10 SCC 337
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Government so long as the infringement of fundamental right
is not shown Courts will have no occasion to interfere and the
Court will not and should not substitute its own judgment for
the judgment of the executive in such matters. In assessing the
propriety of a decision of the Government the Court cannot
interfere even if a second view is possible from that of the
Government.
8. The Court should constantly remind itself of what
the Supreme Court of the United States said in Metropolis
Theatre Company v. City of Chicago (L. Ed. p. 734).
"The problems of Government are practical ones and
may justify, if they do not require, rough
accommodations, illogical it may be, and unscientific.
But even such criticism should not be hastily
expressed. What is the best is not always discernible,
the wisdom of any choice may be disputed or
condemned. Mere errors of government are not
subject to our judicial review."
(Emphasis added)
12 Recently, the Apex Court in the case of Binoy Viswam v.
Union of India and Ors.16 while considering the above position of
law, held that-
"96. .................
Thus, Article 14 in its ambit and sweep involves two
facets, viz., it permits reasonable classification which is
founded on intelligible differential must have a rational
relation to the objects sought to be achieved. Further, it does
not allow any kind of arbitrariness and ensures fairness and
16 MANU/SC/0693/2017, dated 9 June 2017
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equality of treatment. It is the fonjuris of our Constitution, the
fountainhead of justice. Differential treatment does not per se
amount to violation of Article 14 of the Constitution and it
violates Article 14 only when there is no reasonable basis and
there are several tests to decide whether a classification is
reasonable or not and one of the tests will be as to whether it is
conducive to the functioning of modern society."
13 The position of law with regard to the tender, contract
and/or such policy decision has been settled through various
judgments, specifically when it comes to taking administrative and/or
executive decision to bring in and/or make policy. In JSW
Infrastructure Limited & Anr. (supra), the Apex Court held that-
"9. We may also add that the law is well settled that
superior courts while exercising their power of judicial
review must act with restraint while dealing with
contractual matters. A Three Judge Bench of this Court in
Tata Cellular vs. Union of India held that (i) there should
be judicial restraint in review of administrative action; (ii)
the court should not act like court of appeal; it cannot
review the decision but can only review the decision making
process (iii) the court does not usually have the necessary
expertise to correct such technical decisions.; (iv) the
employer must have play in the joints i.e., necessary
freedom to take administrative decisions within certain
boundaries"
14 By keeping above position of law, we are proceeding
further in the matter, as ultimately, the Court needs to consider the
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facts and the nature of terms and conditions of tender. The tender
conditions, if are against the provisions of law, arbitrary,
discriminatory, illegal and affects the fundamental rights of the
Petitioners, covering Articles 14, 19(1)(g) of the Constitution of India,
an appropriate writ or directions may be issued by the Court, but not
otherwise.
Basic provisions-
15 The following Sections of the Major Port Trusts Act, 1963
(for short, "the MPT Act"), are referred and read-
Section 2. Definitions.-
(f) "dock" includes all basins, locks, cuts,
entrances, graving docks, graving blocks, inclined
planes, slipways, gridirons, moorings, transit-
sheds, warehouses, tramways, railways and other
works and things appertaining to any dock, and
also the portion of the sea enclosed or protected
by the arms or groynes of a harbour;"
"(h) "goods" includes livestock and every kind of
movable property;"
"(m) "major port" has the same meaning as in the
Indian Ports Act;"
"(q) "port" means any major port to which this
Act applies within such limits as may, from time
to time, be defined by the Central Government for
the purposes of this Act by notification in the
Official Gazette, and, until a notification is so
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issued, within such limits as may have been
defined by the Central Government under the
provisions of the Indian Ports Act;"
"(r) "port approaches", in relation to a port,
means those parts of the navigable rivers and
channels leading to the port, in which the Indian
Ports Act is in force;"
"(t) "prescribed" means prescribed by rules or
regulations made under this Act;"
"(w) "regulations" means regulations made under
this Act;"
"(x) "rules" means rules made by the Central
Government under this Act;"
Section 42 - Performance of services by Board
or other person.- "(1) A Board shall have power
to undertake the following services:-
(a) landing, shipping or transhipping
passengers and goods between vessels in the port
and the wharves, piers, quays or docks belonging
to or in the possession of the Board;
(b) receiving, removing, shifting, transporting,
storing or delivering goods brought within the
Board's premises;"
"[(3A) Without prejudice to the provisions of sub-
section (3), a Board may, with the previous
approval of the Central Government, enter into
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any agreement or other arrangement (whether by
way of partnership, joint venture or in any other
manner) with, any body corporate or any other
person to perform any of the services and
functions assigned to the Board under this Act on
such terms and conditions as may be agreed
upon.]"
16 The Customs Act, provides that-
2. Definitions- .....
"(12) "customs port" means any port appointed
under clause (a) of section 7 to be a customs port,
[and includes a place appointed under clause (aa)
of that section to be an inland container depot];"
"(13) "customs station" means any customs port,
[customs airport, international courier terminal,
foreign post office] or land customs station;"
"(23) "import", with its grammatical variations
and cognate expressions, means bringing into
India from a place outside India;"
"(26) "importer", in relation to any goods at any
time between their importation and the time
when they are cleared for home consumption,
includes [any owner, beneficial owner] or any
person holding himself out to be the importer;"
"(37) "shipping bill" means a shipping bill referred
to in section 50;"
Section 141. Conveyances and goods in a
customs area subject to control of officers of
customs.-
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(1) All conveyances and goods in a customs
area shall, for the purpose of enforcing the
provisions of this Act, be subject to the control of
officers of customs.
[(2) The imported or export goods may be
received, stored, delivered, dispatched or otherwise
handled in a customs area in such manner as may
be prescribed and the responsibilities of persons
engaged in the aforesaid activities shall be such as
may be prescribed.]
17 The parties have read and referred the conditions of
tender/notice in question and so the policy decisions based upon the
tender conditions/public tender, have been announced.
Scheme and object of the tender:-
18 The object and purpose of inviting tender in the selection
of transporter and providing solution for DPD ISO freight containers
from four terminals of JNPT is reflected in the preamble to the tender.
"Preamble to the Tender
Jawaharlal Nehru Port Trust (JNPT) Navi Mumbai is one
of the twelve Major Ports of India. Commissioned in the
year 1989, it is the number one container port in the
country. JNPT has initiated various steps to improve all
the productivity parameters to reduce the cost and time for
doing business through the port.
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At present, port is stacking the containers CFS/ICD wise
and allocating the cargo to the trucks on "best-pick" model
and "cherry-picking" model is not possible. However, with
the DPD facility, the port will need to create additional
stacks equivalent to the number of DPD clients in order to
continue on the "best-pick" mode. This is not possible due
to the high number of DPD clients and limitation of the
yard area, equipment and manpower capacity.
To find out a suitable solution to this, the transportation
system at various PSUs was studies, however, there was no
similar example for arriving at a transportation solution.
The international ports were studied, however, it was found
that the similar system cannot be implemented at JNPT
because in India the transportation sector is highly un-
organized and the number of trucks available with a
transporter is much less as compared to other developed
countries. Also, the level of automation, standardization
and use of technology is much different in India and hence,
a suitable example for replication was not found.
To address this issue an "Out-of-box" solution was found
which would be "first-of-its-kind" in India. The model
was worked out considering the two requirement- 1) The
number of stacks has to be minimum and 2) It should be
designed on the "best-pick model" keeping the number of
shifting to the minimum.
The detailed background and the transportation solution is
explained further in this section."
19 This was after various studies and information collected by
Port of Customs, Ministry of Shipping and with intent to identify
measures to reduce the transaction cost and time, and the reasons so
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reflected and keeping in line "Ease of Doing Business" and "Make in
India". The Government of India has proposed DPD Model, which
envisages the significant reduction in transaction cost and time.
20 DPD concept and its benefits have also been elaborated.
There is no issue that of the stake-holder including the Petitioners-
importers have appreciated this DPD mechanism. The Government
directives therefore, required to be implemented in line by JNPT and
the Customs and the related stakeholders, including the Petitioners/
importers/transporters. The DPD model is stated to be simple and less
time consuming. The following advantages are not in dispute.
"Prompt and timely delivery leading to reduction in in
inventory costs, saving in transportation costs, saving
in Handling and storage charges at warehouse, saving
in Container detention charges payable to Shipping
Lines, delivery of DPD container at Port Terminals
24x7 basis, reduction in dwell time for containerized
cargo.
In view of the above advantages, DPD is expected to
be the game changer for the EXIM trade."
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21 The limited role of JNPT, Customs, IPA, DG-Shipping and
Private Terminal Operators has been explained in Clause (f). The
respective roles have been discussed with all the stakeholders before
issuing of the tender in question. It is reiterated that-
"The idea is only to create a platform for a
transport operators to work to the requirements
of the DPD model and provide end-to-end
transport solution. The role of JNPT, Customs,
DG-Shipping, Indian Ports Association and
private terminal operators will be very limited in
creating the platform and the business model has
to be run by trade/private sector."
22 The Transportation Solution, which is important facet of
the DPD model is also elaborated in clause (g). This includes the
formation of Grievance Redressal Committee. Clause (g) of the
Transportation Solution reads thus-
"i. Import containers shall be cleared within 48
hours from the port and will be delivered
directly at the factory/premises of the
importer/location as designated by the
Importer.
ii. All DPD Cargo traffic will be distributed
route-wise into the identified routes.
iii. Port terminal operators will arrange DPD
import cargo route-wise in separate stacking
area.
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iv. In the present Transport Solution model, a
transporter will be selected for each location
through a bidding process. The rate of the
selected transporter arrived through the
bidding process will be publish on the website
of JNPT and Customs.
v. The importers with DPD facility will be
informed about the transporters selected
through the bidding process and their rates
and the importers shall need to enter into
commercial arrangement with the
transporter.
vi. Importer will need to clear the
documentation of the container immediately
and ensure that the selected transporter
clears the cargo from the port within a total
time of 48 hours, failing which the container
cargo will be transferred to the designated
CFS. In such cases, the importer shall be
required to clear the documentation and the
transporter of the concerned CFS shall
transport the containers from the CFS to
Importer premises.
vii. JNPT, NSICT, NSIGT, GTI, DG Shipping,
Indian Ports Association and Customs
together shall form a grievance redressal
committee that will address the issues of the
stakeholders related to the transport
solution.
viii. JNPT shall not enter into any direct
commercial arrangement with the
transporter.
ix. Importers will need to hire the selected
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transporters for taking the DPD import
delivery. The importers shall enter into
commercial arrangement with the selected
transporters and shall share the necessary
documentation with the transporter based on
which the terminal operators will give
delivery to the transporter.
x. the arrangement with the transporter shall
be governed by the terms and conditions of
this tender. JNPT shall issues Letter of
Award to the Successful Bidder for each route
and the Successful Bidder shall have the
exclusive right to clear the DPD container
from the port for the corresponding route for
which it is selected.
xi. It will be mandatory for the importers to
align with the selected transporter for the
transportation of container cargo on any
particular route. Importers shall not be
allowed to use own fleets.
In these backgrounds, requirement is for an Efficient Transporters with
sound business model.
23 The duration of agreement is three years with a provision
to extend the arrangement for a period of two years at negotiable rate,
terms and conditions on mutual consent. Section 1 provides for the
notice inviting tender, followed by instructions to bidders, the
evaluation of bids, scope and volume of work. The requirement of
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minimum truck trailers is in clause (b) from 1.4.2. The provision is
made about the "operational contract" for truck trailors. The volume
of work and special terms and conditions of contract have been
elaborated in clause (5) and (6). The High level committee is
provided to select more number of tenderer in a route. The volume of
each route is estimated. The Grievance Redressal Committee is
provided in clause 5.8, that will address the issues of stakeholders
related to the transport solution. The Committee shall ensure the
overall quality of service of the transport solution. It is also made
clear about the limited role of JNPT, which is reproduced as under:-
"6.10 JNPT is facilitating the transportation
arrangement between the Importers and the
transporters in order to ensure reduction of Dwell
Time under the DPD arrangement. By submitting
the Bid, the Bidders agree that the commercial
arrangement between the Importers and
transporters will be separate and at any point of
time, JNPT shall not entertain any claim of the
Contractor/Importer. Also, any dispute between
the importers and the contractors shall need to
settle between themselves and JNPT shall not be a
party to the dispute. JNPT/Grievance Redressal
Committee shall only address the issues related to
the DPD arrangement."
24 The provision of transportation arrangement is also
provided in clause 6.10 and so also extension of duration of contract
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and arrangement. Clause 6.16.12 deals with the dispute between
JNPT and the Contractor. The decision of the Chairman of JNPT made
will be final and binding on both the parties, with provision in case,
the contractor is not satisfied the law of land shall prevail. The
jurisdiction of Mumbai High Court shall prevail, so also any dispute
relating to the tender is subject to the jurisdiction of Court at Mumbai
only.
25 The Petitioners have crystallized the concept of DPD and
CFS and requirement of 48 hours evacuation on the arrival of the
goods. Those are as under:-
CFS MODEL:- The CFS, which is nothing but an extension
of the port, was introduced in the year 1989 by the Customs
Department to help clear the congestion of the ports in
India. In this model, imported goods are immediately
shifted after the arrival from the port to CFS, where all the
activities related to clearance of goods for home
consumption, warehousing, temporary admissions, re-
export, temporary storage for onward transit and outright
export and transshipments take place thereby reducing port
congestion. The Petitioners further states that, since
inception on 1989, even the Respondent No. 2 port in order
to counter the congestion issue have been running on the
CFS model thereby confining itself only to terminal activity
and assigning all the Customs examination and de-stuffing
operation to the CFS. Accordingly, over the years, 34 CFS
have been established in the Respondent No. 2 port by the
substantial investment of more than Rs.1000 crore. At
ssm 25 Judgment-wpl1192.17gp.sxw
present, this CFS is employing, directly and indirectly,
around 3000 workers.
DPD MODEL: Direct Port Delivery is a policy introduced by
the Customs as per which the importers who fulfills certain
criterion becomes eligible to directly take the delivery of the
goods without any physical examination of the goods by the
Custom Authority on payment of duty within 48 hours of
the arrival of the vessel. In the year, 2008, Chief
Commissioner of Custom, Nhava Seva issued a Facility
Notice No. 63 of 2008("FN 63/2008 ) as per which DPD
was introduced for the first time in Mumbai Port and the
importers with minimum volumes of 300 TEUS annually
on the basis on their track record and reputation, with
minimum compliance under the Customs Act, 1962 and on
the basis of self-assessment were allowed to take their goods
directly to their factory premises from the port terminal
without it being diverted to CFS. It was further notified that
if the goods under the DPD policy are not evacuated within
48 hours then it would be directly diverted to Speedy CFS
from where the importers can get their goods released. It
may be noted that under the said notification,
approximately 50 importers were identified as the DPD
eligible importers. However, from November 2016 to
February 2016, Commissioner of Custom, Nhava Seva
issued two Public Notices having No. No. 161 of 2016, ("PN
161/2016"), Public Notice No. 180 of 2016 ("PN
180/2016") as per which total of 681 importers were
identified who can avail Direct Port Delivery i.e. DPD
facility by relaxing the eligibility requirements specified in
FN 63/2008. The Petitioner submits that due to this policy
decision, the volume of DPD containers increased to 17 %
from 3 %."
Recognized DPD facility from Port Terminal to ACP Importers-
26 Public Notice No. 161/2016 dated 28 November 2016,
ssm 26 Judgment-wpl1192.17gp.sxw
was subject matter of All Cargo Logistics & Ors. (Supra) [Writ Petition
No.3310 of 2017], whereby, it is recorded as under:-
issued Facility Notice No. 63 of 2008. That notice,
inter alia, provided for DPD facility (i.e. for importers
to take delivery directly from the port terminal) to
ACP importers (as per Public Notice No. 64 of 2005)
and to 100% Export Oriented Units (EOUs) for FCL
containers covered by the RMS or where no
examination is required. The petitioners state that
under the DPD facility, delivery of the containers
would be done at the port itself and therefore, such
containers would not travel to a CFS for completion of
the Customs formalities. Facility Notice No. 63 of
2008 provided for importers, who satisfy the aforesaid
criteria, to apply for DPD facility to respondent No. 3
in the prescribed form. It also provided for the
procedure that would be followed under the DPD
facility."
"20. The petitioners state that on account of Public
Notice No. 161 of 2016, there has been a rise in the
volume of DPD container traffic. As a result of this, the
business of CFSs, including the petitioners, was
significantly impacted since a significant number of
containers, which would otherwise hitherto have
passed through CFSs such as the petitioners, would no
longer come to the petitioners on account of being
earmarked as DPD i.e. delivery at the port itself. It is
significant to note that on account of Public Notice No.
161 of 2016, requiring clearance of the containers
from the port within 48 hours, there was an increase
in the number of DPD containers that were sent to the
designated CFSs i.e. Speedy/respondent No. 9 on
account of not being collected within the period of 48
hours prescribed by Public Notice No. 161 of 2016, as
illustrated in further details below."
ssm 27 Judgment-wpl1192.17gp.sxw
"57. ............... Once the regulations deal with such
matters, then, it is not necessary that separate
provisions have to be made for each matter covered
by sub-section (2) of section 141. Section 141(2)
itself enables the Commissioner to exercise control.
The provisions of the Customs Act, 1962 have to be
enforced so as to carry out its object and purpose and
the goods in the customs area are subject to the
control of officers of Customs. They can, with the aid
of these regulations and framed by the Board, control
the receipt, storage, delivery, despatch or otherwise
handling of the imported or export goods in customs
area. If sub-section (2) of section 141 enables the
Board to make regulations for this purpose so as to
assist the officers of Customs in performing their
functions and duties, then, all the more there is no
substance in the contentions of Mr. Dwarkadas that
the officials lack the power or jurisdiction to issue the
impugned notices. The impugned notices are referable
to the regulations which are made under the
provisions of the Act. Therefore, issuance of public
notices is implicit and inherent in the exercise of the
enabling power of ensuring proper handling of the
goods in the customs area and the larger power of
control vesting in the officers of the Customs."
"61. ................. Article 19(1)(g) of the Constitution
of India protects certain rights and particularly to
practice any profession or to carry on any occupation,
trade or business. However, clause (6) of Article 19
enables placing of reasonable restrictions on this
freedom. This clause clarifies that nothing in sub-
clause (g) of clause (1) of Article 19 shall affect the
operation of any existing law insofar as it imposes or
prevent the State from making any law imposing, in
the interests of the general public, reasonable
restrictions on the exercise of the right conferred by
sub-clause (g). The freedom, therefore, is not
ssm 28 Judgment-wpl1192.17gp.sxw
absolute. In the interest of general public, the law
may impose restrictions on the freedom of the citizen
to start or carry out his business. Such a law cannot
be, therefore, struck down as violative of the mandate
of Article 19(1)(g) of the Constitution of India. A
business loss to a particular person or diminution in
profits cannot be, therefore, the ground on which any
action, which is in public interest, can be interfered
with. Therefore, at the instance of the petitioners, the
present public notices cannot be quashed and set
aside."
"67. In the first notice of 2017 (Public Notice No. 8
of 2017 dated 16th January, 2017), the office of the
Commissioner of Customs refers to the
representations by various stakeholders/members
from trade and then states that as a measure of trade
facilitation and ease of doing business, the points
raised by these persons have been examined and
point-wise clarification/procedural requirements are
set out in this public notice. In Public Notice No. 9 of
2017, there is a reference made to meetings with the
CFSs within the jurisdiction of JNCH, at which, their
views were solicited in order to find a solution to
logistic arrangements. It was discussed that the JNPT
is already preparing a logistic solution in the form of
engaging 5-7 major transporters, who will provide
transport services to DPD clients in efficient manner
and evacuation of containers from terminal will take
place on best pick up basis. This will facilitate further
rationalisation of shifting charges being charged by
terminal operators. The DPD clients can avail the
aforesaid logistic solution. Then, various suggestions
on this aspect are referred and further directions have
been issued."
"70. ......If there is a confusion, chaos and delay
then, that may be advantageous to the petitioners,
ssm 29 Judgment-wpl1192.17gp.sxw
but it would be certainly detrimental to the public
interest. The larger public interest has to be sub-
served and once that is ensured, then, the same
prevails over the commercial or business interests of
the petitioners. For their commercial or business
motives, a decision taken in public interest cannot be
interfered with. The mandate of Articles 14 and
19(1)(g) of the Constitution of India are not
violated. "
The Petitioners' frontal points:-
27 Insofar as Writ Petition (L) No. 1192 of 2017-
i) The tender is ex facie illegal and without any
jurisdiction.
ii) The tender interferes with the fundamental rights
of the Petitioner to carry on its trade under Article
19(1)(g) of the Constitution of India.
iii) The impugned tender is sought to create monopoly
in the hands of few big transporters who will be
selected region wise and hence is discriminatory
against the Petitioners as it would unjustly deprive
the Petitioner of their business and hence violates
Article 14 of the Constitution of India.
iv) The impugned tender is arbitrary, unreasonable
ssm 30 Judgment-wpl1192.17gp.sxw
and has been issued without any application of
mind and liable to be quashed as per Article 14 of
the Constitution of India.
v) The impugned tender is arbitrary, unreasonable
and has been issued without any application of
mind is also evident from the fact that the tender
clauses itself are not consistent with each other
which shows the whimsical approach of
Respondent No.2 in issuing the tender.
vi) The tender has been issued in excess of the
mischief sought to be prevented or object sought
to be achieved.
vii) There is no urgency which is shown by Respondent
No.2 in the issuance of such tender and that the
said tender is of an excessive nature as it goes
beyond the requirement of the interest of general
public.
Insofar as Writ Petition (L) No. 1626 of 2017-
i) Power and the jurisdiction of the Respondents.
ssm 31 Judgment-wpl1192.17gp.sxw
ii) Fundamental right to do business under Article
19(1)(g) of the Constitution of India.
iii) Minutes of the meeting can never amount to
"policy decision of the Government".
iv) The transportation policy will be optional and not
compulsory.
v) The tender is an extension of the DPD policy and
even supported by Customs.
vi) Tender creates monopoly.
vii) The tender does not deal with the delivery of the
goods.
Policy decision by any mechanism-
28 The concept of "policy decision" may include Executive
instructions/instructions also. The effect and use of it only enlightend
its utility and usefulness. Any challenge to policy decision, without
factual document/material is premature. Any policy decision cannot
be challenged on presumption and assumption. The policy decision
can be changed and modified, subject to its practice, utility and its
ssm 32 Judgment-wpl1192.17gp.sxw
use. It is ultimately the State/expert's/ executive decision, keeping in
mind the interest of people at large, rather than private individual or
associations' rights of doing business. Judicial review is permissible
only if such decision is contrary to law and/or breaches constitutional
provisions. Some leverage and latitude requires to be given to the
State and its authorities, for implementation of such policy decision.
29 In the larger interest of all the concerned, the joint action
committee recommended the policy to encourage and develop the
DPD Model of clearance of containers from the port, and thereby,
direct delivery to be given to accredited importers identified by the
customs authorities within 48 hours of their landing. The DPD model,
insures speedy removal of the containers from the port, by reducing
the dwell time of containers and therefore, the cost. A cabinet
approval on 16 November 2016, at the meeting of the Secretary,
Ministry of Shipping that JNPT would identify the transporters for the
routes for the DPD clients and issue tender for these transporters in
two weeks time. JNPT to plan 4 th Container Terminal, kept in mind,
the increase in traffic that would be handling by DPD and DPE. The
ssm 33 Judgment-wpl1192.17gp.sxw
JNPT, therefore, decided to provide and arrange for transportation of
the containers from the port area based on per-determined routes.
30 The preamble to the tender provides:-
(i) Drawback and issues arising out of the existing
CFS Model, which has led to increase in the
transaction cost and time due to its logistic costs
and additional detention;
(ii) Advantages of the DPD Model and the benefits it
has in reducing the delivery time and costs,
which in turn, will also decongest the port;
(iii) The successful implementation of the DPD
Facility and the efficient handling at the port is
based on transport solution, for which purpose,
JNPT, Customs, Indian Ports Association and DG
Shipping together with the private terminal
operators have taken the initiative to work out a
transportation solution for DPD;
ssm 34 Judgment-wpl1192.17gp.sxw
(iv) The transportation solution necessitates the port
terminal operator (JNPT in this case) to arrange
DPD import container route-wise in a separate
stacking area. This in turn, requires
predetermination of transporters for each
location.
31 The JNPT has issued the tender for selection of
transporters, keeping in view the change in the staking order of the
containers at the port, to ensure speedy removal the number stacks
need to be reduced and to be arranged region-wise, so that each of the
containers can be delivered and removed in the sequence in which the
same are stacked, without shifting them for the purposes of giving
delivery of a specific container to the transporter. It has therefore,
been decided, based on the data received by Respondent No. 2 from
the Customs Authorities to identify five routes. This would enable the
stacking of containers to be done region-wise, thereby making
stacking simpler and avoiding shifting of containers since irrespective
of the order in which the containers are stacked, it would be stacked
ssm 35 Judgment-wpl1192.17gp.sxw
for the same route in the same region, and the transporter can pick
any of them for delivery to the consignee (importer). This is to ensue
that the dwell time and the costs of delivery of the container would be
reduced.
32 The JNPT, published the tender with various conditions,
including eligibility criteria of two models which provides the
opportunity to wider the number of truck clauses, truck operators and
other transportation business persons. This includes, the Consortia-
Joint Venture or the operational contract basis even for the period of 9
months.. The manner of evaluation of bids is provided. The High
Level Committee is constituted to select more than one tenderer for
any of the routes. The scope of tender is defined as it covers only the
DPD Containers. The other requirement like Reefer Containers,
Flattrack Bed, Open Top, Tank Containers, are not the requirements.
33 It is stated that, the tender covers only 28% of the total
import cargo handled by Respondent No. 2 which is 50% of the total
ssm 36 Judgment-wpl1192.17gp.sxw
cargo handled by Respondent No. 2, the balance 50% being the export
cargo. Thus, the tender affects only 14% of the total cargo handled by
Respondent No. 2 under the DPD Model. It is therefore, respectfully
submitted that the tender for selection of transporters is designed to
implement the DPD model, which is part of the larger policy of the
Government of India. To successfully implement the DPD policy and
to ensure efficient removal of the containers within 48 hours and
thereby, reduce the dwell time and the costs, Respondent No. 2 needs
to rearrange and/or change the manner of stacking of containers on
the basis of predetermined routes. This would eliminate shifting of
containers from one place to another while giving delivery to the
selected transporter. Respondent No. 2 is the "Major Port" within the
meaning of the MPT Act, read with Indian Ports Trust Act, 1908. The
port is a restricted area and Respondent No. 2 is empowered to
control and regulate entry and access to the port area. The functions
of Respondent No. 2 are inter alia, set out in Section 42 of the MPT
Act. Respondent No. 2 is authorized to decide the manner in which
the containers shall be stacked and stored within the premises of
Respondent No. 2 and in what manner, and how the same shall be
removed and transported from its premises, including the order and
ssm 37 Judgment-wpl1192.17gp.sxw
manner in which the delivery of the containers shall be given to each
of the DPD importers through the selected transporters. Respondent
No. 2 has therefore, issued the tender with a view to reduce dwell
time and costs, and to ensure smooth and orderly dispatch of the
container without causing congestion in and around the port. As
such, the tender is based on the larger policy of the Government of
India and has accordingly been designed in public interest with the
above objectives.
34 It is clear therefore, considering the preamble and object
of policy decision, taken at higher level, in furtherance of the DPD
model to promote the government of India's "Make in India", and
"Ease of Doing Business" initiatives. The Respondents' decision to re-
rationalise and streamline the implementation of the DPD model at its
port is well within the scheme. The DPD model is introduced to bring
in a change in the existing clearance framework to meet contemporary
needs. The tender, is with view to implement the policy decision to
promote the manufacturing industry and streamline the processes for
import of goods.
ssm 38 Judgment-wpl1192.17gp.sxw
35 The process relating to transport of containers is further
clarified as under-
i) JNPT is one of the twelve major Ports in India and
the biggest container port in the country.
ii) The dispatch logistics of transport of imported cargo
from ports conventionally works in two ways -CFS
Model and DPD Model. The DPD Model was
introduced in the Port in 2008 to streamline the
dispatch of imported cargo that lands at the port.
The two models are briefly described below.
iii) In the CFS Model, there are broadly five participants
involved, viz. (i) the Port, (ii) the Container Freight
Station, (iii) Customs authority, (iv) the Importer
and (v) transporters. The containers offloaded at
the port are aggregated at as heaps for each CFS at
JNPT's Container Yard at the outset and then
transported to one of several CFS (JNPT has 34
ssm 39 Judgment-wpl1192.17gp.sxw
CFS). The transporter does not "cherry pick" the
container but is required to collect containers on a
"best pick" mode (i.e. containers destined for a
particular CFS are required to be collected on a first
availability basis). Customs clearance happens at
the CFS. Thus the cargo is first released for
transport trucks to transfer the containers from the
Port's container yard to the CFS, and thereafter, from
the CFS to the importer. The entire process in the
CFS Model routinely takes 8-9 days out of which 7/8
days are spent in CFS. Several issues were identified
with the CFS Model, namely, additional, avoidable
transportation and handling cost which can vary
between Rs. 8,000/- to Rs. 15,000/-.
iv) To address the issues that arose out of the CFS
Model, the Government of India had proposed the
DPD Model which envisages a significant reduction
in transaction cost and time. From 2008, the
shipment logistics by way of the DPD Model has
come to be gradually implemented at JNPT. In the
ssm 40 Judgment-wpl1192.17gp.sxw
DPD Model, the intermediary process of transferring
the goods to a CFS is eliminated. An importer,
accredited by Customs, is permitted to take delivery
of the container from the Port's container yard.
Customs verification is undertaken within the
terminal itself. The entire process is cut down to
barely 2 days. There is significant saving in
transportation costs, handling, storage costs and
reduction of "dwell time" for containerized cargo.
The importer directly benefits from this model; there
is a corresponding reduction in costs, congestion and
chaos that is routine in the industry and it is cheaper
to conduct foreign trade for the country.
v) However, even with the introduction of the DPD
Model, the CFS Model continues at JNPT. This is
because not all importers are eligible to avail the
DPD Model (eligibility for which, is determined by
the Customs authorities).
vi) The Customs Department (which is the statutory
ssm 41 Judgment-wpl1192.17gp.sxw
authority which determines the extent of
implementation of the DPD Model), aligning with
Government decision to significantly enlarge DPD
volume, permitted more numbers of Importers to
avail the DPD facility for removal of cargo at JNPT
and has been in the process of accrediting such
importers. As of late 2016, more than 700 importers
were recognized to avail the DPD Facility.
vii) With a significant increase in the number of
importers using the DPD Model, it was realized that
segregating containers on to large number of heaps
and in the absence of a suitable / tailored transport
solution, evacuation difficulty will increase
manifold. Anticipating the chaos and confusion
likely to occur with the increase in traffic congestion,
the Petitioner decided to rationalize and streamline
the implementation of the DPD Model at its Port.
viii) The policy decision by the JNPT was to select
transporters for five different high-volume routes, by
ssm 42 Judgment-wpl1192.17gp.sxw
way of a transparent tendering process. The criteria
for selection of transporters were broadly premised
on: (a) fleet size and capability of transporter, (b)
experience in the field, (c) financial capability of
transporter, (d) technological capability to cater to
logistical requirements. The selected transporters
were to operate for a period of three years,
extendable by two years upon mutual consent.
ix) JNPT's decision to so rationalize the transportation
under the DPD Model is with the wide-ranging
object of streamlining the traffic movement to and
from the Container yard and to ensure reliable and
good quality service to the importers. Accordingly,
keeping with this policy decision, the Petitioner
issued notice of tender dated 23 March 2017,
inviting prospective transporters to apply for
selection.
36 The JNPT has also required to improve the route container.
ssm 43 Judgment-wpl1192.17gp.sxw
The JNPT does not access rights created by fly overs, created parking
spaces, converted holding yard into processing area, shifted customs
formation from gate to processing area, removed tool booth, deployed
additional security personnel to support to the police, introduced
CCTV surveillance camera at important junction, created control room
and simplified the time consuming procedures. It is cleared that this
is to reduce the logistical coasts to support the manufacturing and
other economic activities. It is the matter of record that a large
number of stake-holder have been consulted. The bidders would be
selected on behalf of importers, through the transparent bidding
process, which would be evaluated by a high level committee
comprising of the members of IPA, DG, Shipping, Customs and JN Port
Terminal including two major DPD importers.
The Policy is within the power and jurisdiction of Respondents-No
breach of law.
37 The challenge is raised by the container operators,
Association, importers and transporters to the entire tender but not
only to the tender conditions. There is no question of breach of
fundamental rights of any association, as such, the breach of
ssm 44 Judgment-wpl1192.17gp.sxw
individual rights, even if any, required to be considered on factual
data/material basis. It cannot be on assumption and presumption.
The power, authority and jurisdiction of the Respondents to bring in
new policy, keeping in mind, the purpose and object so reflected in the
preamble and the other parts of the terms and conditions of the tender
cannot be stated to be without jurisdiction and/or authority and/or
illegal. The Petitioners have no independent and/or exclusive rights
to do the business of transportation or importation in any area
without the due permission, sanction and authorization from the
respective authorities under the law. The privilege/license/gate
passes of transportations and/or doing business even if granted, it is
always subject to terms and conditions and its limitations. All are
bound to manage their affairs and to do the business even of
transportation and/or delivery of goods within the spare of law and
regulation and conditions. The Petitioners have right to take the
delivery of goods through the one transporters- that itself does not
mean such transporters and/or importers can bring in or out their
own transports at their will and wish, even at port/customs area. The
smooth transportation of goods and/or delivery of goods from
port/customs area to respective market places and/or vice-versa,
ssm 45 Judgment-wpl1192.17gp.sxw
required to be streamlined to avoid congestion and delay. All
departments and stake-holders are required to work in coordination
and in the interest of people at large for providing the goods at the
destiny, at the earliest point of time. This is in the background that
ultimately, the department/the officials in the port area and/or
customs area are required to handle and/or deal specifically in bulk
imported and/or exported goods. The requisite number of containers
are required to be stalked in or arranged for proper delivery of the
goods of the respective importers and/or persons. The proper
documentation of the goods and the procedure so followed, is in the
interest of all. The goods must be reached and delivered to its
owners/importers/transporters, at the earliest. The importers are
free to have their own transporters but they cannot have a right or
insist to do their transportation through the particular transporters.
The tender not restricting their right of transportation. This only
intend to streamline ingress and outgress of vehicles/transportation
for proper and smooth delivery of goods through the 4/5 gates route-
wise, area-wise. The role of transporters and importers required to be
restricted near/on such gates. This, in no way, debar and/or obstruct
the commercial arrangements between the importers and the
ssm 46 Judgment-wpl1192.17gp.sxw
transporters. They have required to arrange their affairs even of this
nature, keeping in mind the policy/regulations and the scheme so
adopted in the interest of all. It is a matter of contract only. The
Respondents have nothing to do with such rights. Such streamline
policy can be stated to be taking away any fundamental rights and/or
legal rights of the transporters and/or importers. The new policy is
for proper implementation of the aims and objects so announced in
the preamble of the tender.
38 We cannot overlook that "port" or "port area" is a
restricted area and of all the transporters are required to take delivery
of their imports clients after due license/gate passes and permission
including ingress and outgress of vehicles. Section 42(1)(b) of the
MPT Act and its contents, provide the power of port to undertake
various services including receiving, removing, shifting, transporting,
storing, delivering the goods brought within the port premises.
Merely the goods become "out of charge" that itself is not sufficient or
takes away the authority of the Respondents to regulate and/or
streamline the smooth transportation of goods through these
ssm 47 Judgment-wpl1192.17gp.sxw
transporters/containers. The purpose and object of the scheme of the
tender is to remove congestion and smooth and fast transportation of
goods apart from rearrangement and arrangement of containers
staking. The obligation of the Respondents to control and regulate it,
till it goes out of the JNPT area and/or out of the area through the
fixed route. The route-wise arrangement, cannot be stated to be
contrary to any law and/or jurisdiction and/or authority.
No fundamental rights are affected-
39 The submission that the tender interfering with the
fundamental rights of the Petitioners to carry on its trade under Article
19(1)(g) of the Constitution of India is unacceptable. The private
selection of transporters and right to continue to do business with
them by the importers association, members and/or right of
transporters to do business, only with the particular private importers
even by long standing, in no way can be stated to be violative of
Article 19(1)(g) of the Constitution of India. The internal contract,
even if any, required to be arranged as per the policy and/or
regulation fixed by the authorities with whom they want to and/or
ssm 48 Judgment-wpl1192.17gp.sxw
intend to do such business. To say that for this existing contracts the
Respondents should not change and/or bring a new policy, is
unacceptable situation. The Respondents have been regulating the
affairs of such transportation and/or delivery of goods from time to
time in the port/customs area, keeping in mind the demand and
supply of such goods and the requirement of importers and
transporters. It is a matter of record that how the transporters/
importers and respective vehicle numbers have been changed now up
to 450/750. The Respondents cannot be silent spectators and not to
take any decision to bring in the mechanism, in the interest of people
at large. The Petitioners contentions therefore, are unacceptable.
They are always free to do their business within the framework of law
and the policy. It is unacceptable contention that this tender and
mechanism breaches any fundamental rights of such transporters
and/or importers. The Judgments so cited read and referred in this
regard, need no discussion, as the law is settled. We have to consider
the facts and circumstances of the case and so also change the policy
decision, keeping in mind, the requirement of time and the situation.
ssm 49 Judgment-wpl1192.17gp.sxw
State policy cannot be regulated by the private stake-holders-
40 There is nothing that the policy decision so initiated
cannot be implemented without the Petitioners approval and/or the
consent. There is ample material on record to show that before
declaring the tender, the stake-holders were invited and the same was
discussed. It is unacceptable that the Petitioners were not aware of
such, even otherwise, the executive decision if they have taken and it
is within the framework of law and their power and jurisdiction unless
it is contrary to law and/or fundamental rights. The scope of judicial
review is very limited specifically when, there is no contra factual
and/or material data placed on record except assumption and
presumption. This is in the background that the tender itself not yet
implemented and/or acted upon because of interim order obtained by
the Petitioner in the Petition. Everything is halted so also the
implementation of the new scheme and/or mechanism. This is in the
background that the Petitioners are not opposing the DPD
policy/mechanism. The Petitioner cannot be permitted to decide the
Respondents requirement to have a transport solution and the related
policy, in view of the stated urgency.
ssm 50 Judgment-wpl1192.17gp.sxw
41 The reliance on the Judgments, including State of Bihar &
Ors. (Supra) and Association of International Schools & Principals
Foundation & Anr. (Supra), are of no assistance, specifically in the
facts and circumstances of the case. This is not the case, where any
fundamental rights of transporters and/or the importers have been
envisaged under Article 19(1)(g) of the Constitution of India and have
been curtailed permanently and/or temporarily. They are free to their
business, but then according to the policy decision, so declared by the
JNPT, insofar as the transportation and/or importation and delivery of
goods within their area.
42 This is also in the background that the Respondents have
issued the tender to implement the public notice dated 28 November
2016 issued by the Chief Commissioner of Customs, under Section
141(1) of the Customs Act, which was issued for implementation
which includes the DPD policy in the JNPT. About 681 importers
have been identified from DPD from the JNPT port. As noted, the
Petitioners and others have already welcomed the DPD policy in JNPT.
ssm 51 Judgment-wpl1192.17gp.sxw
This also is to promote the Government of India's "make an India" and
"Ease of doing business initiative".
43 The Respondents' mechanism to select the transporters,
keeping in mind, to clear the transport congestion at the port,
therefore, cannot be halted with. This is in the background that the
increase in the DPD containers, created the containers stake, the
containers DPD Wise, due to the congestion of the yard area. To stake
the containers route-wise and by selecting the transporters for the
route, through the tender process to make the evaluation smooth
without any congestion, therefore, at this stage, cannot be stated to be
unjust, arbitrary and/or without any aims and objects. This assists in
clearing the containers within 48 hours to avoid compulsory
designated CFS. This is in All Cargo (supra) considered this facet in
favour of the Respondents. Therefore, this transportation policy, if it is
in integral and/or connected part of the DPD policy and once the DPD
policy is recognized and accepted, even by the Petitioners, it is difficult
to dissect the transportation policy of this nature, only at the instance
of transporters, importers, containers and other stake-holders.
ssm 52 Judgment-wpl1192.17gp.sxw
44 We are inclined to observe that the Respondents need to
consider overall system and mechanism, keeping in mind the DPC
policy, government initiatives and the requisite transportation smooth
delivery of goods and transportation. The restriction, therefore, so
imposed by selecting the route and number of importers, agents, and
to carry out the business of transportation through the said main
tenderer/importers, based upon the route and number of
trucks/transporters, in no way take away any fundamental rights.
They are free to do their business, but within the framework of new
policy so declared. We are inclined to observe that the challenge, at
this stage, without permitting the JNPT to proceed with the scheme
and mechanism which they have announced and decided to
implement, is quite premature and in fact obstructing to the
implementation of the new policy. Such action of the Petitioners is,
therefore, not in the interest of public at large. Individual cases and
grievances, if any, and/or difficulties even if any, is always matter of
discussion and negotiation and settlement. The modification and/or
change in policy conditions, are always available. Therefore, at this
stage, to halt the tender and to declare it arbitrary, unjust, violative of
ssm 53 Judgment-wpl1192.17gp.sxw
any articles, is unacceptable. We are inclined to observe here that,
the transporters and/or importers cannot insist how the Respondents
JNPT to do the business and to manage the affairs and/or regulate the
port and/or its area. This is keeping in mind the various departments
involved and their requirement to control and/or regulate such import
and export of goods and its proper and effective timely delivery by
avoiding the congestion area, any sorts of delay in actual delivery of
goods, even if it is "out of charge".
45 There is no force in the contention that it creates the
monopoly in the hands of somebody, who will have selected region-
wise. The purpose of this selection, the region-wise and route-wise
selection and internal to have a few importers in-charge with their
respective numbers of trucks/transport containers, cannot be stated to
be a creation of monopoly. The freedom of business, jointly, singly
and/or collectively, based upon the policy and/or regulations. The
requirements in the respective fields is always a matter of commercial
wisdom and arrangement. Therefore, the contentions of the
Petitioners are unacceptable. The reliance on the Mahesh Verma Vs.
ssm 54 Judgment-wpl1192.17gp.sxw
State of Maharashtra
is of no assistance on the facts itself. There is
a force in the contentions that the DPD containers only 28% of the
import cargoes (which ratio of import and export cargo is 50:50). The
transporters are free to do their remaining business of transportation,
even at the JNPT port, apart from about 14% of entire transportation.
There are various mechanism provided for transporters to do business
jointly, individually or through the joint venture and/or through 9
months contract mechanism.
46 We are of the view that the Respondents required to allow
to proceed with the tender and to implement the same. In case of
difficulties and/or issues various mechanisms have been provided.
Those mechanisms require to be utilized by all the concerned as and
when occasion comes. The halting of such implementation at the
instance of the Petitioners, therefore, is not in the interest of people at
large.
47 The impugned tender, therefore, is not arbitrary
17 2008 (4) Mh. L.J. 657
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unreasonable and cannot be stated to be without any application of
mind. All the clauses are required to be read and so also all the
connected schemes. Therefore, at this per-mature stage, the
contention of the Petitioners and to interfere with the tender is not in
the interest of all the concerned. We are not inclined to accept the
case of the Petitioners that the tender is in excess and beyond the
interest of general public. On the contrary, keeping in mind the
judgments of the Supreme Court, the classification and the tender
conditions so imposed and the mechanism so announced unless
contrary material brought on record, it is well within the object sought
to achieve. The classification and the action is reasonable and well
within the framework of declared policy and power and authority of
the Respondents.
All Cargo (supra) decision is connected.
48 The Petitioners' counsel tried to distinguish the case of All
Cargo (supra), by saying that those notices dated 9 February 2017, 6
January 2017, were issued under Section 141 (2) and Section 157(2)
of the Customs Act, as the authorities have power to make rule in
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respect of the movement of the goods in the port area and therefore,
submitted that the in the present matter, the Respondents have no
power and jurisdiction to issue such tender. Therefore, as contended
in the present case, they have challenged the action of JNPT and not
of the Chief Commissioner of Customs. The Judgment of All Cargo
(supra)) is not challenged by the importers. The Court noted that the
Petitioners were silent for more than 8 years, as the first public notice
was issued in 2008, as similar notice for appointment of designated
CFS. It is also contended that, the goods which were diverted to the
designated CFC were not out of charge and the customs have lien on
the said goods. The movement of the goods which are out of charge
by JNPT through this tender is a issue.
49 We are inclined to observe that the above distinct features
of All Cargo (supra) as recorded above, cannot be dissected totally, as
the policy decision so taken, is the integrated and connected part of
JNPT regulation and so the Commissioners, customs regulations. The
preamble of tender itself makes position clear that all the concerned
departments are interested and involved for free and smooth
ssm 57 Judgment-wpl1192.17gp.sxw
transportation of the goods of the importers, through the transporters
from the JNPT and/or by customs area.
Power to change or modify the policy decision in the public
interest-
50 The individual Petitioners' instance to do the business,
through the contractors of their choice is not fundamental rights
and/or legal rights/ which should prevail over the authority of
Respondents, to change the policy and/or implementing the new
transportation policy. Such Petitioners/importers/ manufacturers are
free to do business and/or transportation, but according to the policy
and the regulations so fixed by the Respondents. Such streamline of
transportation, in no way takes away and/or infringe such
manufacturers fundamental rights to do business. Tender stakes,
therefore, cannot be decided at the instance of one such singular
manufacturer. The right to chose the transporter, in view of above,
cannot be stated to be fundamental to prevail over the power and
authority of Respondents to bring in and change the business rules of
transportation. There is no substance in the contention that it is an
ulterior motive and/or malafide intention and/or create a monopoly
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in favour of some transporters.
51 The stage of submission of tender, not yet proceeded,
because of the interim order passed by this Court. The submissions
and the contentions on assumption and presumption at the instance of
transporters, manufacturers and/or importers, is therefore,
unacceptable. The private parties commercial agreements with the
transporters or the importers cannot be within the purview and power
of the Respondents. The Respondents JNPT however, by following the
due procedure, inviting the transporters of particular route with
particular numbers of transporters/trucks, keeping in mind the
scheme and object that itself cannot be read to mean that they have
interfered and or infringed the others rights. By keeping of private
agreements open and applying no restrictive rules in the agreements
and by providing all the various transport contracts for fixing the
routes and/or particular routes, source of liberty and freedom to grant
to all the concerned to do the respective business. The Respondents
tender, at this stage, cannot be stated to be reflecting non application
of mind, arbitrary and/or unjust. Bijoe Emmanuel & Ors. (supra) is
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distinguishable on facts and circumstances itself and specifically for
the reasons so recorded above. That Judgment, therefore, so cited by
the learned counsel appearing for the Petitioners are of no assistance
to interfere with the tender so issued. [(Gainda Ram & Ors.(supra)]
52 We have noted that the terms and conditions of the tender and
its object and purpose, is in the interest of general public. The
infringement, even if any, to some extent as stated by the Petitioners,
of the private interest of transporters/importers or few
importers/transporters, cannot prevail over in the public interest so
referred in the policy decision and the tender conditions.
53 Therefore, the submission that the transportation policy
would be optional and not compulsory, is not acceptable. Such
optional policy will create confusion, chaos and will be uncontrolled
and unregulated. The policy decision and its implementation
therefore, required to be implemented and extended to all the
concerned. Unless the decision is concrete and make compulsory, it
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will be difficult to implement and as it is nothing but extension of DPD
policy and supported by the customs and all the concerned
departments, it will not be entail the desire result, to achieve the aims
and objects of the scheme/policy decision. Its implementation by all, is
a must.
54 Resultantly, we pass the following order-
ORDER
a) Both the Writ Petitions are dismissed.
b) There shall be no order as to costs.
55 Mr. Kantawala, the learned Counsel appearing for the
Petitioners-Association, after pronouncement of this Judgment in open
Court, submitted to extend the interim stay already granted by this
Court on 27 April 2017. However, considering the reasons so
recorded and to avoid further delay and as the stay has been in force
till this date, we are inclined to continue the interim order so granted
by this Court on 27 April 2017, for further two weeks from today.
Order accordingly.
(ANUJA PRABHUDESSAI, J.) (ANOOP V. MOHTA, J.)
