Delhi High Court
Intec India Limited vs Union Of India & Ors on 20 December, 2017
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* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of Decision: 20.12.2017
+ LPA 804/2017 & CM Nos.46598-46600/2017
INTEC INDIA LIMITED ..... Appellant
Through: Dr. Amit George with
Mr. Prashant Sharma, Advs.
versus
UNION OF INDIA & ORS ..... Respondents
Through: Ms. Shubhra Parashar, Adv. for
R-1/UOI.
Mr. Arun Kumar, Adv. for R-2.
CORAM:
HON'BLE MR. JUSTICE S. RAVINDRA BHAT
HON'BLE MR. JUSTICE A.K. CHAWLA
S. RAVINDRA BHAT, J.(ORAL)
1. Complaining of arbitrariness, the appellant had sought the
remedy under Article 226 of the Constitution in respect of the
detention/demurrage charges for two months (from 14.08.2016 to
15.10.2016) claimed by the respondent (hereafter "CONCOR") to the
extent of `6,04,686/-. The appellant‟s contention was that the
materials on the record produced before the Single Judge revealed that
CONCOR was beneficiary as lessee of public lands for which it paid
an extremely subsidised fee. The learned Single Judge rejected the
plea of arbitrariness and held that the detention charges claimed by
CONCOR and the private agency i.e. COSCO were justified. It was
held also that COSCO was neither a State nor were its activities
covered under Article 226 of the Constitution.
2. Dr. Amit George, learned counsel relies upon the decision in
The Commissioner, Hindu Religious Endowments, Madras v. Sri
Lakshmindra Thirtha Swamiar of Sri Shirur Mutt AIR 1954 SC 282 to
highlight especially the distinction made in the judgment between a
licence and other charges to say that a licence charged by a
Government agency has a bare nexus with the fee. It is thus
contended that having regard to the extremely subsidised nature of
lease charges that CONCOR bears for access to the public lands - to
the tune of `44 crores on which its depot is located, the detention
charges based upon tariffs fixed by it are arbitrary and unreasonable.
Learned counsel also relied upon the judgment reported as Ramana
Dayaram Shetty v. The International Airport Authority of India and
others AIR 1979 SC 1628 to contend that when the State chooses to
engage itself in a commercial activity, it has to act reasonably, having
regard to the compulsions of its duty to offer welfare benefits and
ensure widest reach to those entitled to the service.
3. The respondents, especially CONCOR, resist the appeal and
contend that judicial review cannot be resorted to for examination of
the charges fixed for the services rendered as is sought to be done.
In the counter affidavit filed in answer to writ proceedings, it was
clearly demonstrated that the tariff is not based on the alleged
subsidised rates at which the lease was obtained but rather it is the
culmination of an elaborate process whereby proposed charges are
paid at the rates fixed, and where no rates are so fixed, charges are
paid at such rates as may be fixed by the authorities. It is submitted
that for fixing the tariff at the relevant rates, a report consultation
mechanism is resorted to whereby stakeholders such as shipping lines
and other service providers‟ views are also taken into account.
Learned counsel relied upon the counter affidavit to indicate some of
the considerations that weighed with CONCOR and the authorities at
the time of fixation.
4. The Court is of the opinion that there is no infirmity in the
impugned judgment. Whilst fixation of licence fee for an activity
which is akin to a sovereign function such as calculation of fee for
providing licenses or registration to aircraft vessels and motor vehicles
or even services which the State offers in its capacity as a sovereign
entity, undoubtedly, have to bear a direct and perhaps an approximate
nexus with the activity itself and therefore ought to be reasonable,
even minimal, that restriction, however, in the opinion of the Court,
does not imply that the State chooses to engage in what are purely
„commercial activities‟ that can be carried out by other entities.
In such situation, the State exercises either by itself or through its
agencies the powers that are fettered and also vested with all the rights
as well as the obligations imposed on like entities who operate in the
commercial field having regard to its choice under Article 298 of the
Constitution. Life Insurance Corporation of India v. Escorts Limited
1986 (1) SCC 264 is an authority for proposition that when the State
chooses to operate commercially, it cannot be undoubtedly fettered
and operates in the same level playing field as provided and
authorized, with the added responsibility of broadly conforming to
non-arbitrariness and discrimination. The record reveals that
CONCOR routinely undertakes and reports exercise of tariff fixation
on periodical basis which entails consultation with all stakeholders.
Doubtlessly, importers and exporters are also part of such exercise.
In the present case, the petitioner/appellant could not clear the goods
for two months and was imposed deduction charges which it knew
when it entered into the arrangement with CONCOR. Having regard
to these factors, this Court is of the opinion that there is no infirmity in
the impugned judgment.
The appeal is accordingly dismissed.
S. RAVINDRA BHAT, J
A.K. CHAWLA, J
DECEMBER 20, 2017
kks
