Karnataka High Court
Bangalore International Airport ... vs Menzies Aviation Bobba Bangalore ... on 23 May, 2023
Bench: Chief Justice, M.G.S. Kamal
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WA No. 566 of 2023
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 23RD DAY OF MAY, 2023
PRESENT
THE HON'BLE MR PRASANNA B. VARALE, CHIEF JUSTICE
AND
THE HON'BLE MR JUSTICE M.G.S. KAMAL
WRIT APPEAL NO. 566 OF 2023 (GM-TEN)
BETWEEN:
BANGALORE INTERNATIONAL AIRPORT LIMITED
A COMPANY WITHIN THE MEANING OF THE
COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
KEMPEGOWDA INTERNATIONAL AIRPORT
ALPHA 2, ADMINISTRATION BLOCK
DEVANAHALLI
BENGALURU - 560 330
REPRESENTED BY ITS AUTHORISED SIGNATORY
MR. K.P. MADHAN KUMAR
Digitally
signed by S/O SHRI V.K.PARIMAINTHAN
SUMA B N MAJOR.
Location:
High Court ...APPELLANT
of Karnataka
(BY SRI. UDAYA HOLLA SR. ADVOCATE FOR
SRI. MANU PRABHAKAR KULKARNI, ADVOCATE)
AND:
1. MENZIES AVIATION BOBBA (BANGALORE) PVT. LTD.,
A COMPANY INCORPORATED
UNDER THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT:
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WA No. 566 of 2023
CARGO TERMINAL 1,
KEMPEGOWDA INTERNATIONAL AIRPORT
DEVANAHALLI
BANGALORE - 560 300
REPRESENTED BY ITS DIRECTOR.
2. MENZIES AVIATION PLC
HAVING ITS REGISTERED OFFICE AT
MW1 BUILDING 557
SHOREHARN ROAD
HEATHROW AIRPORT
LONDON, UNITED KINGDOM
TW6 3RT
REPRESENTED BY ITS DIRECTOR.
3. AIRPORTS AUTHORITY OF INDIA
RAJIV GANDHI BHAWAN
SAFDARJUNG AIRPORT
NEW DELHI - 110 033
REPRESENTED BY ITS
DIRECTOR GENERAL OF CIVIL AVIATION.
4. MENZIES AVIATION CARGO (BANGALORE)
LIMITED, A CO. ORGANISED AND EXISTING UNDER
MAURITIAN LAW AND HAVING ITS
REGISTERED OFFICE AT:
5TH FLOOR, EBENE ESPLANDE
24 CYBERCITY, EBENE
REPUBLIC OF MAURITIUS
(AMENDED AS PER COURT ORDER DATED:23.05.2023)
...RESPONDENTS
(BY SRI. HARISH NARASAPPA SR. ADVOCATE FOR
SRI. ASHWINI G RAJ, ADVOCATE FOR R1;
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WA No. 566 of 2023
SRI. C.K. NANDA KUMAR SR. ADVOCATE FOR
SRI.KASHYAP N NAIK, SRI. ABHIJIT ATUR, ADVOCATES FOR R2;
SRI. DHYAN CHINNAPPA SR. ADVOCATE FOR
SRI. PRASHANTH V.G., SRI. AYYANNA S., ADVOCATES FOR R4)
THIS WRIT APPEAL IS FILED UNDER SECTION 4 OF THE
KARNATAKA HIGH COURT ACT PRAYING TO A). CALL FOR ENTIRE
RECORDS IN THE W.P.NO. 22931/2022 CONNECTED WITH W.P.
NO.8306/2022 FILED BY THE RESPONDENT NO.1 TITLED
MENZIES AVIATION BOBBA (BANGALORE) PRIVATE LIMITED V.
BANGALORE INTERNATIONAL AIRPORT AND OTHERS. B). SET
ASIDE THE IMPUGNED ORDER DATED 23.05.2023 IN W.P.
NO.22931/2022 CONNECTED WITH W.P. NO. 8306/2022 FILED
BY THE RESPONDENT NO.1 TITLED MENZIES AVIATION BOBBA
(BANGALORE) PRIVATE LIMITED V. BANGALORE INTERNATIONAL
AIPORT AND OTHERS. C). CONSEQUENTLY, STAY ALL FURTHER
PROCEEDINGS IN W.P.NO.22931/2022 CONNECTED WITH W.P.
8306/2022 FILED BY THE RESPONDENT NO.1 TITLED MENZIES
AVIATION BOBBA (BANGALORE) PRIVATE LIMITED V.
BANGALORE INTERNATIONAL AIRPORT AND OTHERS.
THIS APPEAL COMING ON FOR ORDERS, THIS DAY CHIEF
JUSTICE, DELIVERED THE FOLLOWING:
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WA No. 566 of 2023
JUDGMENT
Oral prayer of the appellant for amendment of cause
title is allowed.
Claiming an extreme urgency the writ appeal is
circulated before this Court.
2. The above writ appeal is filed challenging an order
passed by the learned Single Judge on an application
seeking an interim prayer filed in W.P.No.22931/2022. It is
submitted before this Court that the interim order of status
quo was passed by the learned Single Judge at 3 P.M. today
and the text of the order was uploaded at about 5.30 P.M.
That the appellant immediately took steps such as
preparation of the appeal memo and requested for placing
the matter before the Court. In the backdrop of these facts,
the matter was taken up by this Court at about 7.15 P.M.
WA No. 566 of 2023
3. Heard Sri.Uday Holla, learned Senior counsel
appearing on behalf of Sri.Manu Prabhakar Kulkarni, learned
counsel for appellant. Sri.Harish Narasappa, learned Senior
counsel appearing on behalf of Sri.Ashwin G.Raj for
respondent No.1. Sri.C.K.Nanda Kumar, learned Senior
counsel appearing on behalf of Sri.Kashyap N. Naik, learned
counsel for respondent No.2. Sri.Dhyan Chinnappa, learned
Senior counsel appearing on behalf of Sri.Prashanth V.G.,
learned counsel for respondent No.4.
4. The writ appeal is filed seeking to set aside the
impugned order dated 23.05.2023 passed in
W.P.No.22931/20222 connected with W.P.No.8306/2022
filed by the respondent No.1 titled "Menzies Aviation Bobba
(Bangalore) Private Limited Vs Bangalore International
Airport and others".
5. It may not be necessary for us to refer to the facts
in detail. As such, we may refer to the relevant and material
WA No. 566 of 2023
facts. The petitioner Menzies Aviation Bobba (Bangalore)
Private Limited (hereinafter referred to as "MABP" for the
sake of brevity) was awarded the contract by appellant
(respondent No.1-Bangalore International Airport Limited)
as a service provider to carry out development, operation,
management, maintenance and transfer of cargo terminals
for domestic cargo operations and international export and
import cargo operations and cold chain facility operations at
Kempegowda International Airport. The contract was
executed between the parties on 16.05.2006 for a period of
15 years further extendable by five years. Grievance of the
petitioner in the writ petition is the petitioner was expecting
extension of contract as its services were satisfactory and
there was no objection raised by appellant at any point of
time. As such, the petitioner had sought for an extension of
period of the contract. The said request of the petitioner for
extension was rejected by appellant and the appellant had
initiated tender process. Being aggrieved by the same
petitioner filed first writ petition bearing No.8306/2022
WA No. 566 of 2023
seeking an order for extension of contract and also
challenging the tender process.
6. During pendency of the first writ petition the tender
process initiated by appellant was completed and tender was
awarded to respondent No.2- Menzies Aviation PLC. As such
being aggrieved by the said action second petition
W.P.No.22931/2022 is filed by the petitioner on 14.11.2022.
It appears that the writ petition though was listed on several
occasions no interim order was passed. The petition was
listed before the learned Single Judge along with an
application for interim prayer today i.e., 23.05.2023.
Learned Single Judge has by the interim order passed today
directed the parties namely petitioner and appellant to
maintain status quo and operate under the existing
agreement till next date of hearing. Learned Single Judge
has directed to list the matter for final hearing in the second
week of June, 2023 as there is an urgency involved in the
petition. Aggrieved by the said interim order the present
appeal is filed by the appellant.
WA No. 566 of 2023
7. Learned Senior Counsel Sri.Uday Holla appearing
for the appellant vehemently submitted that the interim
order passed by the learned Single Judge leads to peculiar
and chaotic situation. It is submitted that admittedly the
contract awarded in favour of petitioner is effective only till
00.01 hours of 24.05.2023 inasmuch as no extension has
been granted and request for extension has already been
rejected. That a new contract is awarded to the successful
bidder i.e., respondent No.2. In view of contract having
being awarded to respondent No.2, the same would be
effective from 00.01 hours of 24.05.2023. That existing
security clearance and various other permissions and
licences which were issued in favour of the petitioner also
expires on 23.05.2023 at the close of business hours and
the fresh security clearance licences and permissions
accorded by Bureau of Civil Aviation Security for cargo and
operations would be operative from 00.01 hours of
24.05.2023. Thus he submits after 00.01 hours of
24.05.2023 there is no valid licence or permission in favour
of the petitioner. The appellant-BIAL has nominated
WA No. 566 of 2023
successful bidder-respondent No.2 as a custodian licensee-
security clearance licence. Learned Senior counsel Sri.Uday
Holla further submits that by way of interim order the
extension is granted to the petitioner without there being
any claim of the assessment and final approval on the claim
of extension made by the petitioner. Thus in a way the
learned Single Judge has granted final relief to the petitioner
in the nature of interim order.
8. Learned Senior counsel Sri.Uday Holla further
submits that situation that would emerge at 00.01 hours of
24.05.2023 at the Airport on account of the interim order
passed by the learned Single Judge would be that the
petitioner who is not having valid security clearance licence
and permissions as stated above would not be in a position
to operate and execute the terms of the contract. Whereas
respondent No.2 custodianship of licensee who is the
successful bidder would be prevented from carrying out any
operations. Learned Senior counsel also submits that
approximately 600 tonnes of material would be offloaded
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WA No. 566 of 2023
and similar amount of material would be loaded at the
cargo terminals at the Bangalore Airport for transportation
to other countries. In this particular situation in the absence
of valid approvals and security licence in favour of petitioner,
the petitioner would not be in a position to operate and carry
on with any function at the Airport and on the contrary
respondent No.2 despite having valid licences and
permissions would be prevented from operating and carrying
on with the functions in view of the interim order. Learned
Senior counsel further submits that despite bringing to the
notice of the learned Single Judge about these aspects of the
matter, the same has not been adverted to in the interim
order impugned in this appeal.
9. Learned Senior counsel further submits that the
contention of the petitioner before the court that the
petitioner was carrying out or continuing with its contractual
obligation satisfactorily and that there was no objection
raised by respondent No.1 is not in consonance with the
records. He further submits that time and again the
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WA No. 566 of 2023
petitioner was communicated to focus on the quality
enhancement in the services and without showing any
positive response in that regard and making any attempt to
enhance the quality in performance the petitioner replied
that as and when contract is extended then only it would
take appropriate steps for the quality enhancement in
service. In support of his submission Sri.Uday Holla, learned
Senior counsel referred to a communication dated
08.04.2022 which is placed on record along with the writ
petition at Annexure-L. Sri.Uday Holla further referring to
these very document submits that apart from
communication there was also a personal meeting between
the authority of the appellant and petitioner and even in the
said personal meeting the authority of the appellant insisted
upon the quality enhancement in the services. He further
submits the very communication also refers to the periodical
communications. As such, he submits the contention of the
petitioner that there was no fault found in the services of the
petitioner is incorrect. On these submissions learned Senior
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WA No. 566 of 2023
counsel prayed for stay of the impugned order passed by the
learned Single Judge.
10. Per contra, Sri.Harish Narasappa, learned Senior
counsel for petitioner vehemently opposes the submissions
of the learned Senior counsel for the appellant. The Senior
counsel for the petitioner submits that by way of interim
order an extension is granted to the petitioner only for a
period of three weeks and that there will be no difficulty for
the petitioner in obtaining further approval and security
licences and if appellant co-operates with the petitioner by
obeying the interim order the petitioner would be able to
obtain necessary approvals and security licences within
shortest possible time and there will be no hampering of
activity for want of approvals and security licence. Learned
Senior counsel for the petitioner seriously refutes the
submission that after 00.01 hours of 24.05.2023 there would
be a chaotic situation in the Airport. He submits that the
petitioner has been carrying on the activities in terms of the
contract over the years and that continuing further would
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WA No. 566 of 2023
not be an issue of serious concern. He submits it is just a
matter of adherence to the interim order by the appellant
which would enable smooth functioning and performance of
the terms of the contract as has been done over the years.
He insists that since the rights of the petitioner with respect
to the relief sought in the writ petitions are yet to be
adjudicated it was just and reasonable that the status quo
was maintained till such adjudication. As such he submits
no grounds are made out warranting interference. Hence,
seeks for dismissal of the appeal.
11. Sri.Dhyan Chinnappa, learned Senior counsel
appearing on behalf of respondent No.4 vehemently
submitted that the petition is filed on the basis of a
resolution legality and validity of which is seriously disputed.
He submits that the petitioner company is having 51% stake
while respondent No.4 is having 49% stake therein. He
submits that respondent No.4 has not consented either for
extension of contract or for initiation of any legal
proceedings. The proposal in the said meeting for
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WA No. 566 of 2023
continuation of contract was only by 51% stake holders as
such the same would not make the resolution valid and legal
without having the approval or consent of other 49% stake
holders. It is also submitted by learned Senior counsel that
there are serious disputes between the stake holders which
are pending consideration before the learned sole
Arbitrator. Thus, he submits these and various other
aspects of the matter would require consideration by the
learned Single Judge and without considering these aspects
learned Single Judge ought not to have passed an interim
order.
12. Sri.C.K.Nanda Kumar, learned Senior counsel
appearing for successful bidder -respondent No.2 a joint
venture company submits that no blanket security
clearances would be issued to a company but it is issued to
each individual worker. He further submits that security
licence which is granted to the employees of the petitioner
will be operational admittedly till 00.01 hours of 24.05.2023.
He also submits all the employees of petitioner have now
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WA No. 566 of 2023
been engaged by the successful bidder- respondent No.2
and an agreement is arrived at between these employees
and successful bidder for the engagement of their services
and the new security licence which is granted to its new
employees would be operational from 00.01 hours of
24.05.2023. Therefore he submits that there will be chaotic
situation wherein though interim order of status quo has
been passed in favour of petitioner, yet the petitioner
without having any manpower may not be in a position to
carry out any operation at the Airport and that enforcement
of the interim order remains only on paper.
13. Heard learned counsel for the parties. Perused
the records.
14. The matter pertains to process of awarding of
tender. It is pertinent to refer to the Judgment of the Apex
Court in the case of N.G.Projects Limited Vs Vinod
Kumar Jain reported in (2022) 6 SCC 127 wherein at
paragraphs 23 and 26 the Apex Court has held as under:
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WA No. 566 of 2023
"23. In view of the above judgments of this Court,
the Writ Court should refrain itself from imposing its
decision over the decision of the employer as to
whether or not to accept the bid of a tenderer. The
Court does not have the expertise to examine the
terms and conditions of the present day economic
activities of the State and this limitation should be
kept in view. Courts should be even more reluctant
in interfering with contracts involving technical issues
as there is a requirement of the necessary expertise
to adjudicate upon such issues. The approach of the
Court should be not to find fault with magnifying
glass in its hands, rather the Court should examine
as to whether the decision-making process is after
complying with the procedure contemplated by the
tender conditions. If the Court finds that there is
total arbitrariness or that the tender has been
granted in a malafide manner, still the Court should
refrain from interfering in the grant of tender but
instead relegate the parties to seek damages for the
wrongful exclusion rather than to injunct the
execution of the contract. The injunction or
interference in the tender leads to additional costs on
the State and is also against public interest.
Therefore, the State and its citizens suffer twice,
firstly by paying escalation costs and secondly, by
being deprived of the infrastructure for which the
present-day Governments are expected to work.
26. A word of caution ought to be mentioned herein
that any contract of public service should not be
interfered with lightly and in any case, there should
not be any interim order derailing the entire process
of the services meant for larger public good. The
grant of interim injunction by the learned Single
Bench of the High Court has helped no-one except a
contractor who lost a contract bid and has only
caused loss to the State with no corresponding gain
to anyone.
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WA No. 566 of 2023
15. Further a perusal of the agreement arrived at
between the parties and the copy of which is placed on
record by the petitioner itself indicates that it is the
responsibility of the petitioner to obtain all necessary
approvals and licences including a licence obtained from the
Central Board of Excise and Customs and Bureau of Civil
Aviation Security, Director General of Civil Aviation, Airport
Authority of India and other relevant authority. There is no
obligation on the part of appellant to provide any assistance
to the petitioner for obtaining such approvals and licences.
As such the submissions made by the learned Senior
counsel for the petitioner that it is matter of few minutes in
obtaining required approvals and licences if the appellant co-
operates with the petitioner, is only a wishful thinking on
the part of the petitioner and nothing more than that. This
is particularly for the reason, firstly there is no obligation on
the part of appellant-BIAL to obtain such approvals and
licences. Secondly, appellant-BIAL has already rejected the
request of the petitioner to extend the contract, which act of
rejection has led to the present stalemate. In the light of
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WA No. 566 of 2023
this adversarial situation submission of the learned Senior
counsel for the petitioner that the appellant -BIAL should
co-operate in obtaining approvals and licences just within
few hours from now cannot be countenanced. As rightly
submitted by the learned counsel for the appellant and
successful bidder respondent No.2 in the absence of required
approval and licence petitioner would not be in a position to
lawfully carry out the functions and operation at the cargo
terminal and therefore interim order of status quo granted
by learned Single Judge would become unenforceable. The
consequences and ramifications of such a situation cannot
be lost sight of. Petitioner cannot be expected to function
and operate without required approvals and licences which
admittedly expires at 00.01 hours of 24.05.2023 and the
approvals and licences admittedly granted in favour of
successful bidder -respondent No.2 would become effective
and operational at the same time. This in our considered
view has missed the attention of the learned Single Judge
while passing the interim order.
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WA No. 566 of 2023
16. In consideration of the submissions of learned
counsel for the parties, and in view of the factual and legal
aspects of the matter, we are of the considered view that
the interim order granted by the learned Single Judge
impugned in this appeal cannot be sustained.
17. Needless to state that learned Single Judge has
directed to list the matter for hearing on merits during
second week of June 2023. As such, all the contentions to
be raised or raised by the parties are kept open. No fruitful
purpose would be served by keeping the appeal pending. As
such we propose to dispose of the writ appeal with a request
to the learned Single Judge to hear and decide the petition
on the scheduled date as mentioned in the impugned order.
We hereby clarify that our observations in this order are only
restricted to an interim order passed by the learned Single
Judge impugned in this appeal and this order of us shall not
come in the way of adjudication of the rights of the parties
in accordance with law.
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WA No. 566 of 2023
18. By taking into consideration all the above referred
aspects, we are of the opinion that learned Senior counsel
appearing for the appellant has made out a case.
For the reasons recorded above, following order is
passed:
The order passed by the learned Single Judge is
clearly unsustainable and as such deserves to be set aside.
Accordingly, writ appeal is allowed and the impugned order
is set aside.
Sd/-
CHIEF JUSTICE
Sd/-
JUDGE
SBN
