Mohammad Irshad S/O Abdul Sattar vs Amravati Municipal Corporation ...
2023 Latest Caselaw 4081 Bom

WPs 1516-23 @ Connected WPs                   1               Common Judgment
            IN THE HIGH COURT OF JUDICATURE AT BOMBAY,
                      NAGPUR BENCH, NAGPUR.

                       WRIT PETITION NO. 1516/2023
Sushikshit Berojgaranchi Navkiran Nagrik Seva
Sahakri Sanstha Maryadit, Amravati (Registration
No.743/2010), Office at Near Durga Mata Mandir,
Belpura, Amravati, Tq. and Dist. Amravati.                           PETITIONER
                                 .....VERSUS.....
Amravati Municipal Corporation through its
Commissioner, Office at Rajkamal Square, Amravati,
Tq. and Dist. Amravati.                                            RESPONDENT

                                     WITH
                       WRIT PETITION NO. 1513/2023
Sharda Mahila Bachat Gat (Registration
No.APPG274009002948), Office at Baripura, Navi Basti,
Badnera, Amravati, Tq. and Dist. Amravati.                           PETITIONER
                                 .....VERSUS.....
Amravati Municipal Corporation through its
Commissioner, Office at Rajkamal Square, Amravati,
Tq. and Dist. Amravati.                                            RESPONDENT

                                     WITH
                          WRIT PETITION NO. 1509/2023
Samyak Nagrik Seva Sahakri Sanstha Maryadit,
Amravati (Registration No. 697/2006), through its
President, Office at Opposite Krushnabai Deshmukh
Vidyalaya, Prabhu Colony, Mahadeo Khori Road,
Amravati, Tq. and Dist. Amravati.                                    PETITIONER
                                 .....VERSUS.....
Amravati Municipal Corporation through its
Commissioner, Office at Rajkamal Square, Amravati,
Tq. and Dist. Amravati.                                            RESPONDENT

                                     WITH
                          WRIT PETITION NO. 1511/2023
Afsar Khan S/o Miya Khan, aged about 56 years,
Occupation : Contractor, R/o Pathan Pura,
Tq. and Dist. Amravati.                                              PETITIONER
                                 .....VERSUS.....
Amravati Municipal Corporation through its
Commissioner, Office at Rajkamal Square, Amravati,
Tq. and Dist. Amravati.                                            RESPONDENT


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 WPs 1516-23 @ Connected WPs                   2               Common Judgment
                                     WITH
                          WRIT PETITION NO. 1507/2023

Shyam Babanrao Shingare, aged about 58 years,
Occupation : Contractor, R/o Nilkanth Chowk,
Budhwara, Amravati, Tq. and Dist. Amravati.                          PETITIONER

                                 .....VERSUS.....

Amravati Municipal Corporation through its
Commissioner, Office at Rajkamal Square, Amravati,
Tq. and Dist. Amravati.                                            RESPONDENT

                                     WITH
                          WRIT PETITION NO. 1518/2023

Maitri Sushikshit Berojgar Nagrik Seva Sahakri Sanstha
Maryadit, Amravati (Registration No. 777/2013),
through its Secretary, Office at Sabnis Plot,
Rajapeth, Amravati, Tq. and Dist. Amravati.                          PETITIONER

                                 .....VERSUS.....

Amravati Municipal Corporation through its
Commissioner, Office at Rajkamal Square, Amravati,
Tq. and Dist. Amravati.                                            RESPONDENT
                                     WITH
                          WRIT PETITION NO. 1514/2023

Sanjay S/o Ramraoji Hirpurkar, aged about years,
Occupation : Contractor, R/o Budhwara Chowk, New
Jain Temple, Amravati, Tq. and Dist. Amravati.                       PETITIONER
                                 .....VERSUS.....

Amravati Municipal Corporation through its
Commissioner, Office at Rajkamal Square, Amravati,
Tq. and Dist. Amravati.                                            RESPONDENT
                                     WITH
                          WRIT PETITION NO. 1508/2023

Maitri Sushikshit Berojgar Nagrik Seva Sahakri Sanstha
Maryadit, Amravati (Registration No. 777/2013),
through its Secretary, Office at Sabnis Plot,
Rajapeth, Amravati, Tq. and Dist. Amravati.                          PETITIONER
                                 .....VERSUS.....

Amravati Municipal Corporation through its
Commissioner, Office at Rajkamal Square, Amravati,
Tq. and Dist. Amravati.                                            RESPONDENT


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 WPs 1516-23 @ Connected WPs                   3               Common Judgment
                                     WITH
                          WRIT PETITION NO. 1512/2023

Berojgaranchi Maharashtra Nagrik Seva Sahakri Sanstha
Maryadit, Amravati (Registration No. 732/2009), Office
at Behind Akbari Mashjid, Akbar Nagar,
Amravati, Tq. and Dist. Amravati.                                    PETITIONER
                                 .....VERSUS.....

Amravati Municipal Corporation through its
Commissioner, Office at Rajkamal Square, Amravati,
Tq. and Dist. Amravati.                                            RESPONDENT
                                     WITH
                          WRIT PETITION NO. 1517/2023

Vikas Ganga Nagrik Seva Sahakri Sanstha Maryadit,
Amravati (Registration No. 342/2002), through its
President, Office at Mudliyar Nagar, Line No.1,
Amravati, Tq. and Dist. Amravati.                                    PETITIONER
                                 .....VERSUS.....

Amravati Municipal Corporation through its
Commissioner, Office at Rajkamal Square, Amravati,
Tq. and Dist. Amravati.                                            RESPONDENT
                                     WITH
                          WRIT PETITION NO. 1515/2023

Shri Sai Sushikshit Berojgar Nagrik Seva Sahakri Sanstha
Maryadit, Amravati (Registration No. 823/2017), Office
at Near Kalamaroti Mandir, Bhaji Bazar, Tarkheda,
Amravati, Tq. and Dist. Amravati.                                    PETITIONER
                                 .....VERSUS.....

Amravati Municipal Corporation through its
Commissioner, Office at Rajkamal Square, Amravati,
Tq. and Dist. Amravati.                                            RESPONDENT
                                     WITH
                          WRIT PETITION NO. 1510/2023

Mohammad Irshad S/o Abdul Sattar, aged about 46 years,
Occupation : Contractor, R/o Habib Nagar No.1,
Amravati, Tq. and Dist. Amravati.                                    PETITIONER
                                 .....VERSUS.....

Amravati Municipal Corporation through its
Commissioner, Office at Rajkamal Square, Amravati,
Tq. and Dist. Amravati.                                            RESPONDENT



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 WPs 1516-23 @ Connected WPs                    4              Common Judgment
________________________________________________________________
 Shri Anand S. Jaiswal, Senior Advocate with Shri Amol B. Patil, counsel for the
                                  petitioners.
 Shri Chandrashekhar S. Kaptan, Senior Advocate with Shri Ankush P. Kalmegh,
                          counsel for the respondent.
______________________________________________________________________

CORAM : A. S. CHANDURKAR AND M.W. CHANDWANI, JJ.

DATE     : APRIL       24,      2023.
ORAL       JUDGMENT :              (PER : A.S. CHANDURKAR, J.)

Since common issues arise in these writ petitions, they are being

decided together by this common judgment. RULE. Rule made

returnable forthwith and heard the learned counsel for the parties.

2. The facts in brief relate to a condition in the contract entered into

by the respondent no.1-Amravati Municipal Corporation with the

petitioner-Societies who are the registered firms undertaking work of

clearing city waste within the jurisdiction of the Municipal Corporation.

On 23.08.2018, the Municipal Corporation published an E-Tender notice

inviting bids for carrying out the work of cleaning in twenty two

Prabhags, each work being liable to be rendered for one Prabhag. In the

E-Tender notice it was stated that initially the work would be granted for

a period of three years with a further extension of one year each on two

occasions. In other words, a successful bidder was entitled to carry out

the works for a total period of five years subject to satisfactory

performance. Each Society being successful bidder has been awarded

such work by separate agreements entered into with the Municipal

Corporation. After completion of the initial period of three years each

WPs 1516-23 @ Connected WPs 5 Common Judgment Society was permitted to carry out the said work for the fourth year.

When the Societies were expecting further continuation of the work in the

fifth year, the Municipal Corporation published another E-Tender notice

on 04.03.2023 inviting bids to carry out the work of cleaning by dividing

the Municipal Corporation into five zones. Being aggrieved by the action

of the Municipal Corporation in not allotting the work for the fifth year,

the aggrieved Societies have filed these writ petitions.

3. Shri Anand Jaiswal, learned Senior Advocate for the petitioner-

Societies invited attention to various clauses of the E-Tender notice

alongwith the terms and conditions of the work order. As per the relevant

terms and conditions the initial work was to be carried out for a period of

three years from the date of issuance of the work order and subject to the

satisfactory completion of such work further extension of one year each

was liable to be granted. As per Clause 75 of the terms and conditions a

third party audit was required to be carried out by a Committee headed

by the Deputy Commissioner. Such third party audit was to be

undertaken every six months. The Society was required to purchase six

mini Tippers that were manufactured in the year 2017-18 alongwith

Ground Positioning System (G.P.S.) system. According to the petitioners

on satisfactory completion of the work of cleaning for three years, the

Municipal Corporation had granted an extension of one year which came

to an end by 31.12.2022. Without any legal justification the Municipal

WPs 1516-23 @ Connected WPs 6 Common Judgment Corporation proceeded to issue a fresh E-Tender notice changing the

manner of allotment of the work by re-structuring twenty two Prabhags

with five Zones. Without any justification and despite the fact that each

Society had satisfactorily completed the works, there was no reason for

the Municipal Corporation to have issued a fresh E-Tender notice. The

Societies had not been penalized for any major default and penalties if

any had been imposed for minor defaults. It was urged that on the

doctrine of 'Promissory Estoppel' the Municipal Corporation was

precluded from issuing a fresh E-Tender notice especially when the

Societies were given to believe that on satisfactory completion of the

works, they were entitled to carry out such works for a total period of five

years. The reply filed by the Municipal Corporation did not indicate what

was the public interest involved so as to issue a fresh E-Tender notice and

discontinue the contracts in favour of the Societies. Attention was invited

to the provisions of Sections 63, 66A and Section 290 of the Maharashtra

Municipal Corporations Act, 1949 to urge that it was a statutory duty of

the Municipal Corporation to undertake the work of cleaning within the

limits of the Municipal Corporation. In that regard, the learned Senior

Advocate placed reliance on the decisions in Vice Chairman & Managing

Director, City and Industrial Development Corporation of Maharashtra

Ltd. & Another Versus Shishir Realty Private Limited & Others [2021

SCC OnLine SC 1141], Mihan Indid Ltd. Versus GMR Airports Ltd. &

Others [2022 SCC OnLine SC 574], Union of India & Others Versus

WPs 1516-23 @ Connected WPs 7 Common Judgment Tantia Construction Private Limited [(2011) 5 SCC 697] and M.P. Power

Management Company Limited Jabalpur Versus SKY Power Southeast

Solar India Private Limited & Others [(2023) 2 SCC 703]. It was thus

urged that on consideration of the aforesaid facts and the doctrine of

'Promissory Estoppel' the issuance of fresh E-Tender notice by the

Municipal Corporation was liable to be quashed.

4. Shri Chandrashekhar Kaptan, learned Senior Advocate for the

respondent-Municipal Corporation opposed aforesaid submissions. At the

outset he submitted that under the terms and conditions on which the

work orders were issued, Clause 95 contained an arbitration clause

wherein it was stated that with regard to any dispute arising under the

contract the same would be referred for arbitration to be undertaken by a

retired Judicial Officer. The terms and conditions relied upon by the

Societies as annexed to the writ petitions were without reference to

Clause 95 and the said terms and conditions placed on record indicated

the terms and conditions only till Clause 94. In view of the fact that a

specific remedy of invoking the arbitration clause was provided in the

terms and conditions and as it was the case of the Municipal Corporation

that the work for the fifth year had not been allotted for that reason, it

was open for the Societies to have this aspect adjudicated by taking

recourse to Clause 95. It was submitted that the Municipal Corporation

had acted in a bona fide manner under the terms of the agreement and

WPs 1516-23 @ Connected WPs 8 Common Judgment hence no fault could be found with the issuance of a fresh E-Tender

notice. Under Clause 72 of the terms and conditions, a provision for

imposing penalties in the contingencies stipulated was made and

penalties had been imposed on the Societies. The specific stand taken in

this regard in paragraph 4 of the affidavit-in-reply filed by the Municipal

Corporation had not been denied by the Societies. Despite the fact that

minor penalties had been imposed upon the Societies it was being urged

by them that the action of the Municipal Corporation was unjustified.

Though under the terms and conditions a successful bidder was required

to purchase new vehicles the same would not mean that satisfactory

performance of the cleaning work could be dispensed with. The

extension of the contract after expiry of three years was dependent upon

satisfactory completion of such works. Since the works were found to be

satisfactory at the end of three years, an extension for a period of one

year was granted. It was thus submitted that in absence of the Municipal

Corporation being satisfied with the discharge of contractual obligations,

no relief could be granted to the petitioners. Inviting attention to the

decision in Deepak Misrimal Jain Versus Municipal Corporation of

Greater Bombay & Others [2001 (3) Mh.L.J. 651], it was submitted that

the work in question could not be stated to be statutory in nature. The

same was non-statutory and the obligations were contractual in nature. It

was thus submitted that no relief could be granted to the petitioners and

the writ petitions were liable to be dismissed.

WPs 1516-23 @ Connected WPs 9 Common Judgment

5. Having heard the learned counsel for the parties and having

perused the documents on record, we find that under the terms and

conditions of the contract, a successful bidder is entitled to carry out the

work of cleaning initially for a period of three years and thereafter on

satisfactory completion of that work he is entitled to an extension of one

further year. Subject to completion of satisfactory work for the extended

period, another extension of one year is permissible. Each Society has

been granted the first extension after completion of three years and hence

such works have been carried out for a period of four years. According to

the Municipal Corporation since it imposed penalties on the Societies and

it was not satisfied with the manner in which the work was carried out,

the extension for the fifth year has not been granted. On the other hand,

according to the Societies even assuming that some minor penalties were

imposed on the Societies, the same did not prevent the Municipal

Corporation from granting extension for the fifth year. It is thus clear that

the Societies seek extension of the contracts for the fifth year in view of

the terms of the contract. It is precisely in such situation that Clause 95

of the terms and conditions would be attracted since there is a dispute

that has arisen with regard to extension of the contract for the fifth year.

In our view, Clause 95 of the terms and conditions would be attracted in

the given facts since the Societies seek extension for the fifth year based

on the terms and conditions itself while the Municipal Corporation seeks

to justify the non-grant of extension for the fifth year on the ground that

WPs 1516-23 @ Connected WPs 10 Common Judgment it was required to impose penalties on the Societies as the work discharged

was not satisfactory. This dispute can be raised in arbitration proceedings

by the Societies by invoking Clause 95 of the terms and conditions.

6. It is urged on behalf of the Societies that under the doctrine of

'Promissory Estoppel' having purchased new vehicles on issuance of the

work order, the Societies were entitled to continuation of the contract for

a total period of five years. It may however be noted that such

continuation is subject to satisfactory discharge of contractual obligations.

The right to extension for the fifth year being dependent upon satisfactory

completion of the work in the previous year, the said aspect cannot be

ignored while applying the doctrine of 'Promissory Estoppel'. The said

doctrine would be subject to the terms and conditions of the contract that

has been agreed by the parties. With regard to the stand of the

petitioners that the contract was entered into for the discharge of

statutory obligations of the Municipal Corporation, we may note that in

Deepak Misrimal Jain (supra) a similar contract for supply of lorries with

labourers for removal of silt, debris, household waste materials, etc. to

the Municipal Corporation was considered by the Division Bench. It was

held that on entering into such contract for the work in question relations

between the parties were governed by the contract and not by any

constitutional provisions. Such contracts were stated to be non-statutory

and the rights of the parties were governed by the terms of the contract.

WPs 1516-23 @ Connected WPs 11 Common Judgment We find that even in the present matter, the rights of the parties would be

governed by the terms and conditions of the work order. Since Clause 95

thereof provides the mode of resolution of such disputes by having a

reference to arbitration it would be necessary for the aggrieved parties to

invoke such clause. We do not find that there is any arbitrariness in the

action of the Municipal Corporation in issuing a fresh E-Tender notice in

the aforesaid backdrop. In fact, in paragraph 82.8 of the decision in M.P.

Power Management Company Limited, Jabalpur (supra) relied upon by

the learned Senior Advocate for the Societies, the Hon'ble Supreme Court

has held that existence of a provision for arbitration is viewed as a near

bar to the entertaining of a writ petition. Moreover, the question whether

the Societies carried out the works in a satisfactory manner or not would

be a disputed question of fact which cannot be resolved in exercise of the

writ jurisdiction.

7. For all aforesaid reasons, we decline to entertain the writ petitions

since the terms and conditions of the work order provide for resolution of

the disputes arising out of the contract by having recourse to process of

arbitration under Clause 95 as provided. By clarifying that the observations

made in the judgment are only for considering the question as to whether

the writ petitions should be entertained or not, it is held that the

petitioners are free to invoke the arbitration clause under Clause 95 of the

terms and conditions of the work order.

WPs 1516-23 @ Connected WPs 12 Common Judgment

8. The writ petitions are thus dismissed. Rule accordingly. No costs.

          (M.W. CHANDWANI, J.)              (A.S. CHANDURKAR, J.)



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