Bombay High Court
M/S Rushabh Outdoors And Anr vs The State Of Maharashtra And Anr on 19 March, 2021
Bench: G. S. Kulkarni
Wp-227.2017
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO.227 OF 2017
1. M/s.Rushabh Outdoors, }
A partnership firm Having }
address at Shop No.8, }
Laxmi Niwas, Sawarkar Path, }
Thane - 400602. }
} Petitioners
2. Vandana Borse, }
Proprietress of M/s.Synnovation }
4, New Neelam, Machhalimar, }
Opp.BaristaVarsova Road, }
Andheri (W), Mumbai -400061. }
versus
1. The State of Maharashtra, }
Through Government Pleader, }
High Court, Mumbai. }
} Respondents
2. Municipal Corporation of Greater }
Mumbai, Through its Commissioner }
Having its Office at Mahapalika Marg,}
Mumbai - 400001. }
.....
Dr. Milind Sathe, Senior Advocate a/w. Mr. Anuj Desai and
Mr. Jatin Sheth for the Petitioners.
Mr. Ashutosh Kumbhakoni, Advocate General a/w. Mr.
Milind More, Additional Government Pleader & Mr. Akshay
Shinde ("B" Panel Counsel) for Respondent No.1/State.
Mr. Suresh Pakale a/w. Ms. Vandana Mahadik for the
Respondent No.2/MCGM.
.....
Page 1 of 20
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CORAM :- DIPANKAR DATTA, CJ &
G. S. KULKARNI, J.
JUDGMENT RESERVED ON : MARCH 2, 2021
JUDGMENT PRONOUNCED ON : MARCH 19, 2021
PC :-
1. This writ petition is at the instance of a partnership
firm and an individual, who is not in any manner related to
such firm. The first prayer is for a declaration from this
Court to outlaw sub-section (2) of Section 479 of the
Mumbai Municipal Corporation Act, 1888 (hereafter "the
Act", for short). There are two other prayers in the writ
petition. The petitioners have prayed for quashing and/or
setting aside Resolution No.999 of 2009 dated December
11, 2009 (hereafter "Resolution No.999", for short) adopted
by the Municipal Corporation of Greater Mumbai (hereafter
"the MCGM", for short), respondent no.2, and also to
restrain the MCGM not to levy licence fees on the basis of
rates decided vide such resolution as well as to refund the
fees collected by them from the petitioners for the period of
last three years.
2. Having regard to the first prayer, it would be
appropriate for us to read Section 479 of the Act to the
extent the same is relevant. Sub-sections (1) and (2) of
Section 479 of the Act read thus:
"479. Licences and written permission to specify
condition etc., on which they are granted
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(1) Whenever it is provided in this Act that a licence
or a written permission may be given for any
purpose, such licence or written permission shall
specify the period for which, and the restrictions
and conditions subject to which, the same is
granted, and shall be given under the signature
of the Commissioner or of a municipal officer
empowered under section 68 to grant the same.
Fees to be chargeable
(2) For every such licence or written permission a
fee may be charged at such rate as shall from
time to time be fixed by the Commissioner, with
the sanction of the corporation."
3. We were hearing Dr. Sathe, learned senior counsel for
the petitioners for admission of the writ petition. In support
of the challenge to sub-section (2) of Section 479 of the Act,
he referred to Articles 243-X and 243-ZF of the
Constitution. According to him, after commencement of the
Constitution (Seventy-fourth Amendment) Act, 1992, sub-
section (2) of Section 479 of the Act had a limited life of one
year from such commencement and being inconsistent with
the provisions of Part IX-A of the Constitution, within such
period of one year the State Legislature ought to have by
law authorized the MCGM to levy, collect and appropriate
taxes, duties, tolls, etc. In the absence of any law as well as
authorization, not only is sub-section (2) of Section 479 of
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the Act presently invalid and inoperative, Resolution
No.999 adopted by the MCGM [purportedly authorized by
sub-section (2) of Section 479 of the Act] is without the
authority of law. In the midst of such a contention being
raised, Mr. Kumbhakoni, learned Advocate General for the
State of Maharashtra, respondent no.1, and Mr. Pakale,
learned Advocate for the MCGM, objected to the
maintainability of this writ petition and urged us to decide
such objection first before proceeding to hear this writ
petition on its merits. In view thereof, we called upon Mr.
Kumbhakoni and Mr. Pakale to address us first on the
point of demurrer.
4. According to Mr. Kumbhakoni, Resolution No.999
dated December 11, 2009, by which the MCGM had
decided on rates/fees, was the subject matter of challenge
before this Court in a batch of writ petitions with Writ
Petition No.1968 of 2013 being the lead matter. A
coordinate bench of this Court by its judgment and order
dated January 27, 2016, reported in 2016 SCC OnLine
Bom. 62 (Yog Advertising and Marketing Services and
Another V/s. Municipal Corporation of Greater Mumbai
and Another) dismissed such batch of writ petitions and
thereby upheld Resolution No.999. A Special Leave Petition
carried from such judgment and order was dismissed by
the Supreme Court by order dated March 14, 2016. Mr.
Kumbhakoni contended that for invoking the writ
jurisdiction under Article 226 of the Constitution by filing a
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petition, where the Constitutional validity of an enactment
or a provision of an enactment is challenged, there has to
be a cause of action and none can challenge a law unless
evil/civil consequences would ensue. Here, even if the
petitioners herein were to succeed on their challenge to
sub-section (2) of Section 479 of the Act, there would be no
scope for this Court to grant consequential relief of setting
aside Resolution No.999 since the same has already been
upheld by a coordinate Bench, and the Supreme Court too
did not find reason to interfere. As a corollary, it has thus
been the contention of Mr. Kumbhakoni that a challenge to
a provision of a statute on the ground that it breaches a
Constitutional provision cannot be examined by the Court
in a vacuum, when no consequential relief can be granted.
In support of his submission that no decision in course of
an academic exercise should be given, Mr. Kumbhakoni
relied on the following reported and unreported decisions:
(i) (2004) 6 SCC 254 (Kusum Ingots & Alloys Ltd.
V/s. Union of India and Another);
(ii) 2018 SCC OnLine Bom 6400 (Jotun India
Private Limited V/s. Union of India &
Others);
(iii) Writ Petition No.105 of 2019 decided on
January 29, 2019 (Jose Manuel Monteiro V/s.
State of Goa, Through its Chief Secretary and
Another); and
(iv) Writ Petition (Stamp) No.96919 of 2020 decided
on February 16, 2021 (Arun Yashwant
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Kulkarni V/s. The State of Maharashtra and
Others).
5. It was next submitted by Mr. Kumbhakoni that
Resolution No.999 having been upheld by the coordinate
bench of this Court in Yog Advertising and Marketing
Services and Another (supra) by assigning detailed
reasons, the petitioners cannot claim that such resolution
has given rise to evil/civil consequences. He further
submitted that this Court may not disagree with the
opinion expressed therein, even it were inclined to hold
sub-section (2) of Section 479 of the Act ultra vires Article
243-X read with Article 243-ZF of the Constitution of India.
6. It was also argued by Mr. Kumbhakoni that the
second petitioner is a member of the Indian Outdoor
Advertising Association, the first petitioner in Writ Petition
No.1068 of 2010, and that such writ petition was heard
along with the writ petition of Yog Advertising and
Marketing Services and Another (supra). In the first
round of challenge, the vires of sub-section (2) of Section
479 of the Act had not been challenged and having regard
to the principles flowing from Explanation IV of Section 11
of the Code of Civil Procedure, 1908 (hereafter "the CPC",
for short), the present challenge, at least at the instance of
the second petitioner, must be held to be barred by res
judicata and/or analogous principles.
7. In support of such submission, Mr. Kumbhakoni
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relied on several decisions of the Supreme Court. We need
not refer to them individually, since we propose to take note
of only those decisions of the Supreme Court which have
applicability on facts and in the circumstances.
8. Resting on the above, Mr. Kumbhakoni prayed that
the writ petition does not call for admission.
9. Appearing on behalf of the MCGM, Mr. Pakale raised
the following objections:
(1) the first petitioner does not say that it is a
registered partnership firm and, therefore, a writ
petition at its instance, should not be
entertained;
(2) the first petitioner is also a member of the
Indian Outdoor Advertising Association and,
therefore, this writ petition is barred by the
principles of constructive res judicata;
(3) Resolution No.999 has been implemented since
2009 and for eight years till presentation of this
writ petition on January 24, 2017, the
petitioners have paid licence fees in accordance
with the rates fixed in December, 2009 and
there being abnormal unexplained delay and
laches, the petitioners are not entitled to a
hearing on merits; and
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(4) even if the first petitioner was not a party to the
earlier round of litigation, the second petitioner
being such a party, it is inconceivable that the
first petitioner and the second petitioner having
joined hands to approach this Court, the first
petitioner is not aware of the proceedings in the
earlier round of litigation wherein Resolution
No.999 was under challenge and the first round
of litigation at the instance of the advertisers
having proved abortive, this proceeding has
been initiated to re-open the issue of validity of
Resolution No.999 and being in complete abuse
of the process of law as well as of this Court, the
writ petition merits in limine dismissal.
10. Mr. Pakale relied on the decision of this Court
reported in AIR 1997 Bom 79 (Center of Indian Trade
Unions and Another V/s. Union of India and Others), in
support of the proposition that the writ petition is barred by
the principles of res judicata. To urge that the writ petition
is delayed and accordingly, should not be entertained, he
relied on the decision of the Supreme Court reported in
(2004) 11 SCC 526 [Express Publications (Madurai) Ltd.
and Another V/s. Union of India and Another].
11. Opposing the preliminary objections, Dr. Sathe
contended that the technical rule of constructive res
judicata would not be applicable in writ petitions filed
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under Article 32 or Article 226 of the Constitution of India.
Relying on the decision of the Supreme Court reported in
AIR 1964 SC 1013 (Amalgamated Coalfields Ltd. and
Anr. V/s. Janapada Sabha Chhindwara and Others), he
invited our attention to that part of the report where it has
been held that constructive res judicata being a special and
artificial form of res judicata enacted by Section 11 of the
CPC, it should not generally be applied to writ petitions
filed under Article 32 or Article 226 of the Constitution of
India.
12. Even otherwise, relying on an additional affidavit filed
in course of hearing, Dr. Sathe contended that the first
petitioner was not a member of the Indian Outdoor
Advertising Association and, therefore, not a party to the
earlier round of litigation; thus, it has the right of action to
approach the Court for a declaration that sub-section (2) of
Section 479 of the Act is ultra vires on the ground that it is
in conflict with Articles 243-X and 243-ZF of the
Constitution of India in as much as the legislature has
failed to lay down any procedure or limits subject to which
the MCGM would be entitled to levy and collect fees.
13. On the question of non-registration of the first
petitioner, Dr. Sathe submitted that the first petitioner is
indeed a registered firm although he has no documentary
evidence in support. In any event, he submitted that the
writ petition can always be amended to bring on record the
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partners of the first petitioner.
14. Before concluding his submission, Dr. Sathe
submitted that vires of a statutory provision on the anvil of
breach of a Constitutional provision having been brought to
the notice of the Court, the challenge ought to be examined
on its merits instead of repelling the challenge on technical
grounds advanced by the learned Advocate General as well
as Mr. Pakale. It has been the contention of Dr. Sathe that
notwithstanding the challenge to Resolution No.999 failing
on an earlier occasion, the Court's attention is now being
invited to the factual position that the vires of sub-section
(2) of Section 479 of the Act was not under challenge in Yog
Advertising and Marketing Services and Another (supra)
and if sub-section (2) of Section 479 of the Act is declared
as ultra vires, Resolution No.999 would not have any
independent existence.
15. Dr. Sathe, thus, prayed that the preliminary
objections being devoid of substance ought to be overruled.
16. We have heard learned counsel appearing for the
respective parties.
17. The following basic points arise for determination:-
(a) Whether the writ petition is barred by the
principles of res judicata and/or analogous
principles?
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(b) Should the writ petition be dismissed on the
ground of unexplained delay and laches?
(c) Does the writ petition deserve to be dismissed
since it is at the instance of an unregistered
partnership firm? and
(d) Whether the challenge to sub-section (2) of
Section 479 of the Act ought to be nipped in the
bud accepting the contention of the learned
Advocate General that the petitioners have no
cause of action because in Yog Advertising &
Marketing Services (supra), Resolution No.999
has been upheld by the coordinate bench of this
Court?
18. Our answers to all the aforesaid questions are in the
negative for the reasons that follow.
19. So far as question (a) is concerned, we have noted the
decision in Amalgamated Coalfields Ltd. (supra) which is
rendered by a Constitution Bench of 5 (five) learned
Judges. Law laid down therein is to the effect that
constructive res judicata being a special and artificial form
of res judicata enacted by Section 11 of the CPC, the same
should not generally be applied to writ petitions filed under
Article 32 or Article 226 of the Constitution. It, therefore,
follows that in an exceptional case, the rule of constructive
res judicata may be applied to a writ petition, be it under
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Article 32 or Article 226. It is elementary though it has to
be restated that Section 11, CPC is not attracted in a
subsequent case unless there is a previous adjudication of
a case on merits between the same parties. We need not
detain ourselves with any discussion as to whether this is a
general or an exceptional case. In the present case, the first
petitioner was not a party to the earlier proceedings and
hence qua the first petitioner, res judicata and/or
analogous principles would not apply.
20. That apart, law is well settled that when an order is
under challenge on the ground that it has been made
without jurisdiction and, thus, is a nullity, principles of
estoppel, acquiescence and waiver, or even res judicata,
which is procedural in nature, would ordinarily have no
application. If any authority is required, we may refer to the
decision of the Supreme Court reported in (2007) 2 SCC
355 (Hasham Abbas Sayyad V/s. Usman Abbas Sayyad).
21. The challenge to sub-section (2) of Section 479 of the
Act being based on breach of a Constitutional provision,
this is not such a case where such challenge should be
thrown out at the threshold without examining it on merits
by applying the rule of res judicata.
22. Question (b) has been answered in the negative
bearing in mind Constitution Bench decisions of the
Supreme Court that there can be no waiver of Fundamental
Rights. The decisions reported in AIR 1959 SC 149
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(Basheswar Nath V/s. C.I.T.) and (1985) 3 SCC 545 (Olga
Tellis V/s. Bombay Municipal Corporation), are directly
on the point. In the present case, the petitioners have
challenged that the fees have been fixed under a statute
which is ultra vires the Constitution and, therefore, the
question of enforcement of a Fundamental Right has
arisen. Although it is settled position of law that writ
remedy under Article 226 of the Constitution of India is
discretionary, in the sense that the remedy is not available
as a matter of right and may be refused by the Court on
consideration of circumstances such as (a) existence of an
alternative adequate remedy, (b) conduct of the applicant
disentitling him to a discretionary remedy, (c) the approach
to the Court is belated, (d) the writ petition is premature,
and (v) relief, if granted, would be ineffective and
infructuous. The Court may also refuse to exercise
discretion where, despite the applicant succeeding on his
allegation of violation of his ordinary legal right, an opinion
is formed that it would not be in furtherance of public
interest to interfere. However, if infraction of Fundamental
Right(s) is alleged qua challenge to an enactment or
provision of an enactment, in such a case, we feel it ought
to be the duty of the High Court to enforce the
Fundamental Right(s) guaranteed to a citizen. In such a
situation, relief under Article 226 of the Constitution may
not be refused only on the ground of delay and laches. We
are reminded of the law laid down in the decision of the
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Supreme Court reported in AIR 1958 SC 956 (In Re: The
Kerala Education Bill, 1957) to the effect that there can
be no loss of fundamental rights merely on the ground of
non-exercise of it. In Amalgamated Coalfields Ltd. (supra)
too, the Supreme Court observed that if a tax imposed is
held to be ultra vires, a writ petition under Article 32 of the
Constitution cannot be refused on the ground that the
petitioners had been paying the tax without objection for
years because such ultra vires tax would encroach upon the
petitioners' Fundamental Rights guaranteed under Article
19(1)(f) and (g) of the Constitution of India.
23. As regards the question of refusing relief on the
ground of delay and laches, the rule that a High Court may
not enter into a belated and stale claim is not a rule of law
but a rule of practice based on sound and proper exercise
of discretion. The principle on which relief to a party on the
ground of delay or laches is denied is that rights which
have accrued to others by reason of delay in presenting a
writ petition should not be allowed to be disturbed unless
there is a reasonable explanation for such delay. The real
test to determine whether a writ petition may not be
entertained on the ground of delay in such cases is that the
petitioners should come to Court before a parallel right is
created and lapse of time is not attributable to any laches
or negligence. This is the law laid down in the decision
reported in (1992) 2 SCC 598 (Dehri Rohtas Light Railway
Company Limited V/s. District Board, Bhojpur and Others).
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24. We may in this connection further note the decision of
the Constitution Bench reported in (1985) 2 SCC 197
(Lohia Machines Ltd. V/s. Union of India) where it has
been observed that :
"13. *** It is settled law that acquiescence in an earlier exercise
of rule-making power which was beyond the jurisdiction of the
Rule-making authority cannot make such exercise of rule-
making power or a similar exercise of rule-making power at a
subsequent date, valid. If a rule made by a rule-making
authority is outside the scope of its power, it is void and it is not
at all relevant that its validity has not been questioned for a
long period of time: if a rule is void it remains void whether it
has been acquiesced in or not. ***".
(emphasis supplied)
25. Resting on the aforesaid principles, it needs to be
examined, at the final hearing, whether the petitioners can
establish violation of Article 14 of the Constitution. Should
the petitioners be able to establish the same, the relief
claimed may not be refused solely on the ground of delay
and it would be obligatory for the Court to enforce the
petitioners' Fundamental Rights. We may also record that
by reason of the belated challenge, no parallel right has
accrued in favour of any person.
26. We have also noted the prayer in the writ petition.
The petitioners have claimed for refund of fees demanded
by the MCGM and paid by them, not from 2009, but for a
period of three years preceding the presentation of the writ
petition. Such a relief appears to us to be in sync with the
decision of the Supreme Court reported in (2008) 8 SCC
648 (Union of India V/s. Tarsem Singh).
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27. The decisions cited by Mr. Pakale have been looked
into. In Express Publications (Madurai) Ltd. (supra),
challenge to a statutory provision was laid after forty-five
years. It was contended on behalf of the petitioners that the
impugned provision was unconstitutional from its inception
in the year 1956. The Court did not dismiss the writ
petition under Article 32 of the Constitution on the ground
of delay but on merits. This decision, therefore, does not
advance the cause of the MCGM.
28. In the aforesaid decision, a short passage from the
judgment of Hon'ble Hidayatullah, CJI. in the decision
reported in (1969) 1 SCC 110 (Tilokchand Motichand V/s.
H.B. Munshi) has been quoted. It was pointed out by His
Lordship that the question
"is one of discretion for this Court to follow from case to case.
There is no lower limit and there is no upper limit. ... It will all
depend on what the breach of the fundamental right and
remedy claimed are when and how the delay arose."
(emphasis supplied)
29. Another Constitution Bench decision, reported in
(1970) 1 SCC 84 (Rabindranath Bose V/s Union of India),
has been referred to in Express Publications (Madurai)
Ltd. (supra). There, the Court held that although Article 32
itself was a guaranteed Fundamental Right, but it does not
follow that it was the intention of the Constitution-makers
that the Court should discard all principles and either go
into stale demands after lapse of years and/or grant relief
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in petitions filed after inordinate delay. However, it has to
be noted that in Rabindranath Bose (supra) the petitioners
had challenged a seniority list finally settled on January 1,
1950. Their Lordships held that the petitioners cannot
complain breach of Articles 14 and 16 of the Constitution
in respect of acts done before the Constitution came into
force.
30. Having read the relevant decisions, we have no
hesitation to hold that an allegation of inaction/omission to
make a law consequent to a Constitutional mandate having
been raised and the sequel of acceptance of the challenge
as laid might lead to a declaration that sub-section (2) of
Section 479 of the Act has ceased to operate one year after
commencement of the Constitution (Seventy-fourth
Amendment) Act, 1992, this writ petition deserves a
hearing on merits.
31. Regarding question (c), the objection raised by Mr.
Pakale has been decided bearing in mind Section 69 of the
Partnership Act, 1932 (hereafter "the 1932 Act", for short)
which provides for the effect of non-registration. Sub-
section (1) of Section 69 of the 1932 Act prohibits
institution of a suit to enforce a right arising from a
contract or right conferred by such Act, unless the firm is
registered. Here, the first petitioner has not sought for
enforcement of a right arising either from a contract or
conferred by the 1932 Act. Section 69 may not, therefore,
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be a bar for an unregistered partnership firm to maintain a
writ petition. Even otherwise, we are of the considered
opinion that the proposition as advanced would not disable
the Court to exercise its jurisdiction under Articles
226/227 of the Constitution of India. The Court has ample
power under Articles 226/227 to do substantial justice.
This writ petition shall be treated to have been filed by the
partners of the first petitioner. Let appropriate amendment
be carried out in the cause title of the writ petition within
two weeks from date.
32. We also observe that in view of our conclusion
recorded above that the writ petition is not barred by
constructive res judicata based on decisions of the Supreme
Court, the writ petition would still be maintainable at the
instance of the second petitioner even if the first petitioner
is held not to have the requisite standing to present the
writ petition.
33. Question (d) has been framed based on the contention
urged by Mr. Kumbhakoni, which we have noted above in
some details. There cannot be any dispute with regard to
the proposition of law that vires of a statutory provision
should not be examined in vacuum. However, what is of
significance in the present case is that the vires of sub-
section (2) of Section 479 of the Act was not in question in
Yog Advertising and Marketing Services and Another
(supra). We do not, for a moment, disagree with the views
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expressed in Yog Advertising and Marketing Services
and Another (supra) on the merits of the challenge to
Resolution No.999. However, since the coordinate bench of
this Court was not called upon, it had no occasion to
examine whether Resolution No.999 had been adopted in
exercise of a power validly conferred on the MCGM. Such
being the question here and if the petitioners were to
succeed on their challenge to sub-section (2) of Section 479
of the Act as ultra vires Article 243-X read with Article 243-
ZF of the Constitution of India, not only would they be
entitled to a declaration on such terms but as a
consequential relief, Resolution No.999 would also have to
be nullified for lack of authority and/or competence to fix
the rates of fees. In these peculiar facts and circumstances,
it cannot be said that the question of vires, as laid before
us by the petitioners, has to be examined in vacuum.
34. For the reasons aforesaid, all preliminary objections
fail and are overruled.
35. We are of the considered opinion that the petitioners
have set up an arguable case for admission of the writ
petition; hence, Rule in terms of prayer clauses (a) to (c),
which read thus:
"(a) that this Hon'ble Court be pleased to declare and
strike down sub-sec.(2) of S.479 of the MMC Act
as being unconstitutional and quash/set aside
the Resolution No.999 of 2009 dated 11th
December, 2009;
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(b) that this hon'ble Court be pleased to issue
appropriate writ, orders, directions directing the
Respondent No.2 not to levy License fees on the
basis of rates decided vide Resolution No.999 of
2009;
(c) that this hon'ble Court be pleased to issue a writ
of mandamus or a writ in the nature of
mandamus or any other appropriate writ, order
or direction directing the Respondent No.2 to
refund the fees collected by them from the
petitioners for the period of last 3 years."
36. Rule is made returnable in the month of September,
2021.
37. The respondents shall be at liberty to answer the Rule
on affidavits by the end of July, 2021. Rejoinder thereto, if
any, by the petitioners may be filed by the 3rd week of
August, 2021.
38. Payment of licence fees by the petitioners shall abide
by the result of the Rule.
(G. S. KULKARNI, J.) (CHIEF JUSTICE)
Digitally
signed by Raju
Raju D. D. Gaikwad
Date:
Gaikwad 2021.03.19
19:48:37
+0530
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