Calcutta High Court
Pradip Agarwal & Ors vs Kolkata Municipal Corporation & Ors on 14 December, 2023
Author: Ravi Krishan Kapur
Bench: Ravi Krishan Kapur
IN THE HIGH COURT AT CALCUTTA
CONSTITUTIONAL WRIT JURISDICTION
ORIGINAL SIDE
BEFORE:
The Hon'ble Justice Ravi Krishan Kapur
W.P.O No. 245 of 2019
Pradip Agarwal & Ors.
vs
Kolkata Municipal Corporation & Ors.
With
W.P.O No. 353 of 2019
Ashok Agarwal
vs
Kolkata Municipal Corporation & Ors.
For the writ petitioners : Mr. Jishnu Saha, Senior Advocate.
(In WPO 245 of 2019) Mr. Ajay Gaggar, Advocate.
Mr. Uttiyo Mallick, Advocate.
Ms. Trini Joarder, Advocate.
For the writ petitioners : Mr. Jishnu Chowdhury, Advocate.
(In WPO 353 of 2019) Ms. Poulami Banerjee, Advocate.
For the respondent no.4 : Mr. Sabyasachi Chowdhury, Advocate.,
Mr. Rajashri Dutta, Advocate.
Mr. Kritin Saraf, Advocate.
For the KMC : Mr. Alok Kr. Ghosh, Advocate.
Mr. Swapan Kr. Debnath, Advocate.
Ms. Piyali Sengupta, Advocate.
Judgment on : 14.12.2023
Ravi Krishan Kapur, J.:
1. Both these writ petitions raise common questions and were heard
analogously.
2. The petitioners assail a notice inviting tender bearing No.
KMC/MKT/17/2018-19 and a letter of allotment dated 29 May 2019
issued by the Kolkata Municipal Corporation bearing reference
no.DMC(M)/L/11/2019-20 pertaining to operation, maintenance and
overall management of "Satyanarayan Park A.C Market".
3. Briefly, Kolkata Municipal Corporation (the licensor), being the owner of
Satyanarayan Park situated at 141, Utkalmoni Gopobandhu Sarani,
Kolkata - 700007 (the premises) had on 15 February, 1985 entered into a
license agreement with Happy Homes and Hotels Pvt Ltd (the licensee) to
develop, establish, remodel and improve the existing park into a two
storied underground market for a period of 30 years (the agreement).
4. By the agreement, the licensee was granted powers to sublicense the
premises and obtain premium as monthly license fees and other
prospective charges including electricity, air conditioning, maintenance
charges etc. However, the licensee did not have the authority to sell,
mortgage, charge, lease or transfer the premises or any part thereof
without prior permission from the licensor. It was also agreed that the
licensee would handover peaceful possession upon expiry of the
agreement and if necessary the licensor would further enter into a fresh
agreement with the existing sub licensees. It is an admitted position that
the licensee paid an amount of Rs. 30,00,000/- on account of premium
and also paid license fees of Rs.40,000/- per month to the licensor. In
addition, the licensee despite expiration of the agreement continued to
remain in possession of the premises and collect license fees and other
charges from the sub licensees. Significantly, there has been no default of
the underlying obligations by and between the licensor Corporation and
the licensee.
5. The aforesaid arrangement carried on till May 2018 when the licensor
published the impugned notice inviting bids for operation, maintenance
and overall management of Satyanarayan Park AC Market bearing no
KMC/MKT/11/2018-2019. Since the licensee was the sole bidder in the
bidding process the tender was cancelled. Thereafter, two further notices
inviting bids were published in 2018 and 2019 respectively wherein the
licensee once again was the sole bidder. There being no other bidder
participating in the tender process, the licensor issued a letter of
intimation to the licensee and accepted the bid of the licensee. Pursuant
to the aforesaid, the licensee has also paid a sum of Rs.4.07 crores as
lease premium to the licensor.
6. The writ petitioners in both these petitions are occupants of individual
shoprooms at the premises. It is alleged that upon termination of the
agreement dated February 15, 1985 on February 14, 2015 the petitioners
became direct licensees under the licensor Corporation and were obliged
to pay the license fees, service charges and air conditioning charges
directly to the licensor. In this context, the petitioners rely on the various
clauses of the sub license agreement. The petitioners also allege that the
licensee acted as a mere agent of the licensor for the given period of 30
years and that the sub-licensees were induced to believe that upon
expiration and under the terms of the agreement, the sub-licensees would
become direct licensees under the licensor Corporation. Thereafter, upon
expiration of the agreement, the petitioner made representations to the
licensor Corporation to accept the sub licensees as direct licensees or
tenants under the agreement. However, the licensor never responded to
such representations. The petitioners also tendered cheques towards
payment of license fees, maintenance charges and air conditioning
charges to the licensee alongwith a covering letter dated 20 May 2019
which were returned by the licensee. It is further alleged that licensor in
publishing the impugned tender and taking steps pursuant thereto has
unilaterally resiled from a concluded contract.
7. On behalf of the respondents it is contended that the decision of the
licensor in issuing a fresh tender is a policy decision and the same cannot
be challenged in this proceeding. In any event, the disputes raised in the
petition are purely contractual disputes and ought not to be adjudicated
by this Court. Diverse proceedings have been filed by the different shop-
owners which are pending before the Civil Courts. One of the shop-owners
had also filed a writ petition which was dismissed as infructuous.
8. Judicial review of policy decisions is limited and circumscribed. Generally,
on matters affecting policy which require expertise, the Courts leave such
decisions on those who are most qualified to address the same. The terms
of the invitation to tender are also not open to judicial scrutiny and the
Courts ought not to interfere as they are in the realm of contract unless
they are found to be arbitrary, discriminatory or actuated by malice.
Insofar as the petitioners seek to challenge the decision to publish a
notice inviting tender in 2018 requesting bidders to make over bids for
maintenance and overall management of the market, the same is a policy
decision and not justiciable. In contracts having a commercial element,
some more discretion has to be conceded to the authorities so that they
may enter into contracts with persons, keeping an eye on the
augmentation of revenue. [Sterling Computers Ltd. v. M & N Publications
Ltd. [(1993) 1 SCC 445, Tata Cellular v. Union of India (1994) 6 SCC 651,
Global Energy Ltd. v. Adani Exports Ltd. [(2005) 4 SCC 435, Master Marine
Services (P) Ltd. v. Metcalfe & Hodgkinson (P) Ltd. [(2005) 6 SCC 138,
Dhampur Sugar (Kashipur) Ltd. v. State of Uttaranchal, (2007) 8 SCC 418
and Shimnit Utsch India (P) Ltd. v. W.B. Transport Infrastructure
Development Corpn. Ltd., (2010) 6 SCC 303, Rishi Kiran Logistics Private
Limited vs. Board of Trustees of Kandla Port Trust & Others (2015) 13 SCC
233 paras 24-28].
9. In any event, ordinarily, a disputed question of fact is not investigated in
a proceeding under Article 226. This is however a rule of discretion and
not an exclusion of jurisdiction. Each case has to be decided on its
peculiar facts. The right which the petitioners seek are purely contractual
right under the sub-license. The contention of the petitioners that they
have become direct licensees/tenants of the respondent no.1 Corporation
on the expiration of the license granted to the respondent no.4 and that
an agreement is to be inferred by incorporation cannot be determined in a
proceeding of this nature. In any event, numerous suits have been filed by
different occupiers including the Satya Narayan Park AC Market Shop
Keepers' Welfare Association before the Civil Court and the same are
pending final adjudication. The question raised by the writ petitioners
necessarily involve a combined interpretation of the clauses of the license
agreement and squarely fall within the realm of contract. Similarly, the
question of whether there was an irrevocable license coupled with grant of
an interest as contended by the petitioners cannot be adjudicated in this
proceeding. Any alleged relationship having been created upon the expiry
of the license agreement and upon the mere tender and acceptance of rent
also cannot be gone into in this proceeding.
10. Moreover, in seeking to assert their rights under the sub-license
agreements, the petitioners are indirectly seeking specific performance of
their respective sub-license agreements. The disputes involved are purely
contractual in nature. A right to relief flowing from a contract has to be
claimed in a Civil Court and the Writ Court is not an option. In any event,
there is no public element involved in this petition since the petitioners
are asserting purely personal rights under their respective sub-licence
agreements. The increase of license fees under the impugned tender is
also an underlying issue between the parties and cannot be adjudicated
by this Court.
11. All necessary pre requisites and norms of the tender process such as
publishing and the tender bidding process have been strictly adhered to
prior to confirming the bid in favour of the respondent no.4. Despite
repeated publications, the respondent no.4 licensee was the only bidder.
There is nothing which is palpably erroneous, malfide, arbitrary or
capricious warranting any interference by this Court. There is also no
irregularity in the decision making process or any contravention of law
which warrants any interference. As a principle, the Writ Court does not
sit as a Court of Appeal but merely reviews the manner in which the
decision was made.
12. In view of the above, both the writ petitions, WP No 245 of 2019 and WP
353 of 2019 stand dismissed. There shall be no order as to costs.
(Ravi Krishan Kapur J.)
