Kerala High Court
The Cochin Municipal Corporation vs M/S.G.J Eco Power Pvt. Ltd on 3 February, 2022
W.A. No. 1685/2020 & 1579/2021 :1:
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR
&
THE HONOURABLE MR. JUSTICE SHAJI P.CHALY
THURSDAY, THE 3RD DAY OF FEBRUARY 2022 / 14TH MAGHA, 1943
WA NO. 1685 OF 2020
JUDGMENT DATED 10.11.2020 IN WP(C) 11850/2020 OF HIGH COURT OF KERALA
APPELLANTS/PETITIONER:
M/S.G.J.ECO POWER PVT.LTD.,
A COMPANY INCORPORATED UNDER THE COMPANIES ACT
HAVING ITS REGISTERED OFFICE AT DOOR NO.X/63,SARAYU
COMPLEX,
SEAPORT-AIRPORT ROAD,KAKKANAD,COCHIN-682 030,REPRESENTED
BY ITS DIRECTOR,
MR.JAMES ADAI,S/O.FR.ADAI JACOB,AGED 36,
BY ADVS.
GEORGE VARGHESE(PERUMPALLIKUTTIYIL)
A.R.DILEEP
MANU SRINATH
P.J.JOE PAUL
RESPONDENTS/RESPONDENTS:
1 THE COCHIN MUNICIPAL CORPORATION
REPRESENTED BY ITS SECRETARY,
PARK AVENUE ROAD,COCHIN-682 011.
2 THE SECRETARY,
COCHIN MUNICIPAL CORPORATION,
PARK AVENUE ROAD,COCHIN-682 011.
3 THE STATE OF KERALA,
REPRESENTED BY ITS PRINCIPAL SECRETARY,
LOCAL SELF GOVERNMENT (DC)DEPARTMENT,
GOVERNMENT SECRETARIAT,
W.A. No. 1685/2020 & 1579/2021 :2:
THIRUVANANTHAPURAM-695 001.
4 THE STATE LEVEL ADVISORY COMMITTEE ON WASTE MANAGEMENT,
REPRESENTED BY CHIEF SECRETARY,
STATE OF KERALA,GOVERNMENT SECRETARIAT,
TRIVANDRUM-695 001.
5 THE KERALA STATE INDUSTRIAL DEVELOPMENT CORPORATION,
KOWDIAR,THIRUVANANTHAPURAM,
KERALA,PIN-695 033.
BY ADVS.
SRI. SUDHEESH KUMAR,STANDING COUNSEL(B/O)
R5 BY SRI. P.U.SHAILAJAN
SHRI.K.JANARDHANA SHENOY, SC, KOCHI MUNICIPAL CORPORATION
R1 & R2 BY RENJITH THAMPAN (SR.)
ADVOCATE GENERAL
R3 & R4 BY SHRI.S.KANNAN, SENIOR G.P.
THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 03.02.2022,
ALONG WITH WA.1579/2021, THE COURT ON THE SAME DAY DELIVERED THE
FOLLOWING:
W.A. No. 1685/2020 & 1579/2021 :3:
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR
&
THE HONOURABLE MR. JUSTICE SHAJI P.CHALY
THURSDAY, THE 3RD DAY OF FEBRUARY 2022 / 14TH MAGHA, 1943
WA NO. 1579 OF 2021
JUDGMENT DATED 10.11.2020 IN WP(C) 11850/2020 OF HIGH COURT OF KERALA
APPELLANTS/RESPONDENT NOS. 1 & 2:
1 THE COCHIN MUNICIPAL CORPORATION
REPRESENTED BY ITS SECRETARY, PARK AVENUE ROAD,
COCHIN-682 011.
2 THE SECRETARY
COCHIN MUNICIPAL CORPORATION, PARK AVENUE ROAD,
COCHIN-682 011.
BY ADV SHRI.K.JANARDHANA SHENOY, SC, KOCHI MUNICIPAL
CORPORATION
RESPONDENTS/PETITIONER & RESPONDENT NOS. 3 TO 5:
1 M/S.G.J ECO POWER PVT. LTD
A COMPANY INCORPORATED UNDER THE COMPANIES ACT HAVING ITS
REGISTERED OFFICE AT DOOR NO.X/63, SARAYU COMPLEX, SEAPORT-
AIRPORT ROAD, KAKKANAD, COCHIN-682 030, REPRESENTED BY ITS
DIRECTOR, MR.JAMES ADAI, S/O.FR.ADAI JACOH, AGED 36.
2 THE STATE OF KERALA
REPRESENTED BY ITS PRINCIPAL SECRETARY, LOCAL SELF
GOVERNMENT (DC) DEPARTMENT, GOVERNMENT SECRETARIAT,
TRIVANDRUM-695 001.
3 THE STATE LEVEL ADVISORY COMMITTEE ON WASTE MANAGEMENT,
REPRESENTED BY CHIEF SECRETARY, STATE OF KERALA,
GOVERNMENT SECRETARIAT, TRIVANDRUM-695 001.
4 THE KERALA STATE INDUSTRIES DEVELOPMENT CORPORATION,
KOWDIAR, THIRUVANANTHAPURAM, KERALA, PIN-695 033.
W.A. No. 1685/2020 & 1579/2021 :4:
R2 & R3 BY SRI. S. KANNAN SR. GOVERNMENT PLEADER
R1 BY SRI. P. WILSON (SR.)
R4 BY SRI. P.U. SHAILAJAN
THIS WRIT APPEAL HAVING BEEN FINALLY HERD ON 03.02.2022, ALONG
WITH WA.1685/2020, THE COURT ON THE SAME DAY DELIVERED THE
FOLLOWING:
W.A. No. 1685/2020 & 1579/2021 :5:
Dated this the 3rd day of February, 2022.
JUDGMENT
SHAJI P. CHALY, J.
The captioned writ appeals are filed challenging the judgment of
the learned single Judge dated 10.11.2020 in W.P.(C) No. 11850 of
2020. W.A. No. 1685 of 2020 is filed by the writ petitioner; whereas,
W.A. No. 1579 of 2021 is filed by the Kochi Municipal Corporation, the
third respondent in the writ petition, basically contending that the
issues raised by the Municipal Corporation were not properly
appreciated by the learned single Judge. W.A. No. 1685 of 2020 is
treated as the lead case and the parties and exhibits are referred to as
in the said writ appeal.
2. The subject issue relates to the cancellation of a contract
awarded to the appellant, a company incorporated under the
Companies Act, by the Corporation of Kochi. The State Government
has cancelled the approval given for executing the contract, for the
implementation of the Waste-to-Energy Project at Brahmapuram,
Ernakulam District as per Ext. P28 Government Order dated
30.04.2020. Thereafter, the Secretary, Kochi Municipal Corporation-
2nd respondent, issued Ext. P29 notice dated 04.05.2020, terminating
the concession agreement executed by and between the appellant and
W.A. No. 1685/2020 & 1579/2021 :6:
the Kochi Municipal Corporation. Even though representation was
made requesting to cancel Ext.P28 and to protect the project, the
State Government, as per Ext.P34 order dated 05.06.2020, passed a
fresh order on the basis of a direction issued by a learned single Judge
of this Court as per Exhibit P32 Judgment in W.P.(C) No.9872 of 2020
dated 30th May 2020, reiterating the order in Ext.P28, having found
that the concessionaire i.e. the appellant, is unable to implement the
project even if more time is allowed. It was, thus, challenging the
legality and correctness of the aforesaid proceedings, the writ petition
was filed.
3. The paramount contentions advanced by the appellant in the
writ petition as well as the appeal are that; Exts. P28, P29 and P34
impugned orders/notice are illegal, arbitrary and violative of principles
of natural justice and the same were issued without any authority;
that even though a letter of award was issued on 08.01.2016 and the
concession agreement was executed on 17.02.2016, the site was not
handed over; that the first respondent, in its decision dated
25.07.2016, only resolved to hand over 8 Hectares of land in
Puthencruz village, Ernakulam District, to the appellant; and that the
sketch of the site was forwarded to the appellant as per Ext. P3
proceedings dated 24.06.2017, and the appellant has received the
same only on 26.02.2018.
W.A. No. 1685/2020 & 1579/2021 :7:
4. It is also contended that out of the total extent of the land
allotted measuring 809.4 Ares, only an extent of 257.6 Ares alone was
dry land and the rest was paddy/wetland covered under the Kerala
Conservation of Paddy land and Wetland Act, 2008 ('Act, 2008' for
short) and therefore, it was impossible and impracticable to implement
the project in the land identified by the Kochi Municipal Corporation;
that only after much discussion and deliberations, and after the
Amendment Ordinance of 2017, the State Government issued Ext. P4
order dated 03.02.2018 exempting the land from the provisions of the
Act, 2008. It was further contended that even in Ext. P4, there was a
condition to construct a Water Conservation Area (pond) in an extent
of 55.18 Ares of land, and further directed not to obstruct the natural
flow of water, and since the entire land was essential for the project
the land exempted for the construction of the water conservation area
has to be compensated.
5. It was further submitted that it was only as per Ext. P6 dated
09.08.2018, the State of Kerala permitted the Kochi Municipal
Corporation to hand over another extent of 3.44 acres of land after
exempting from the provisions of the Act, 2008 and that even though
the concession agreement was executed on 17.02.2016, the extent of
the land to be allotted was finalised only on 09.08.2018 as per Ext. P6
order of the State Government, and when the sketch was handed over
W.A. No. 1685/2020 & 1579/2021 :8:
on 19.11.2018. According to the appellant, by virtue of Article 5 of the
concession agreement, an independent Engineer has to be appointed
to monitor the entire work, and the procedure for appointment of an
independent Engineer is provided in Article 5.1(a) of the Concession
agreement; however, the Kochi Municipal Corporation has not
communicated the list of Engineers to the appellant as contemplated
under Article 5.1(a); that there was no financial bid called for the
selection of the independent Engineer till date and therefore, there was
total violation of Article 5 of the concession agreement. That apart, it
is submitted that though by virtue of Article 3.1(a)(vii), the appellant
has to furnish a financing plan, and financing documents for the
project and thereby demonstrate the financial close, it could not be
achieved due to the recalcitrant attitude of the respondents in handing
over the land in contemplation of the agreement which was the
essence of the contract.
6. According to the appellant, even though various financial
institutions/investors were interested in the project and ready to
finance, the collateral security can only be from the income generated
from the energy and by virtue of a licence/agreement/ concession
agreement, the financiers were not willing to part with the money and
all the financial institutions insisted that the licence agreement shall be
converted into a lease agreement so as to enable them to provide
W.A. No. 1685/2020 & 1579/2021 :9:
necessary finance and therefore, the appellant approached the Kochi
Municipal Corporation and the State Government for conversion of the
concession agreement into a lease agreement.
7. It is also the case of the appellant that the State Level
Advisory Committee on Waste Management, represented by the Chief
Secretary, State of Kerala, the 4th respondent, having been satisfied
with the necessity of converting the concession agreement into a lease
agreement, requested the State Government to take necessary steps
to execute a lease agreement, evident from Exts.P9 and P10 minutes
dated 12.12.2018 and 29.04.2019 respectively; that even though the
Kochi Municipal Corporation, in its meeting held on 29.04.2019,
resolved to reject the request for the execution of lease agreement,
the State Government accepted Exts.P9 and P10 recommendations of
the 4th respondent, the State Level Advisory Committee, and issued
Ext. P22 order dated 16.01.2020 cancelling Ext. P10 resolution of the
Kochi Municipal Corporation dated 29.04.2019 and directing it to
execute the lease agreement.
8. Therefore, the contention advanced by the appellant is that
the State Government as well as the State Level Advisory Committee
understood the necessity of executing a lease agreement and that the
Government was not satisfied with the rejection of the request for the
execution of the lease agreement by the Kochi Municipal Corporation.
W.A. No. 1685/2020 & 1579/2021 : 10 :
Therefore, the contention advanced is that the bona fides of the
appellant in implementing the project is very well reflected from the
conduct of the State Government as well as the State Level Advisory
Committee.
9. The sum and substance of the contentions, relying upon the
stand of the Government and the State Level Advisory Committee, is
that had the Kochi Municipal Corporation complied with Ext. P22
Government Order dated 16.01.2020 and executed the lease
agreement, without any delay, the appellant could have initiated the
activities of financial close immediately; and that it was because of the
recalcitrant attitude of the Kochi Municipal Corporation, having not
executed the lease agreement, the appellant was virtually prevented
from achieving the financial close.
10. The further case of the appellant is that, a major factor
attributed for the delay is the non formulation of the mechanism for
payment of energy charges beyond what is fixed by the Kerala State
Electricity Regulatory Commission, and even though by Ext. P23 order
dated 31.01.2020 the State Government ordered that 25% of the
expenses over and above the average power tariff fixed by the Kerala
State Electricity Regulatory Commission for the energy produced from
the Waste to Energy plant at Brahmapuram should be paid to the
concessionaire by the Government from the major infrastructure
W.A. No. 1685/2020 & 1579/2021 : 11 :
development scheme and that the remaining 75% by Kochi Municipal
Corporation by way of collection of user fee from
households/institutions/participating LSGIs/utilising 15% of the plan
fund to be set apart compulsorily for waste management/by locating
other means etc., no decision has been taken by the Kochi Municipal
Corporation with regard to the payment of 75% of the energy charges
and therefore, there was utter confusion with regard to the payment of
the energy charges by the first respondent.
11. Therefore, it is the predominant contention that, under the
aforesaid circumstances the demand in Ext. P23 Government Order
dated 31.01.2020 to achieve the financial close within 30 days, was
illegal and beyond perception of the agreement executed by and
between the parties.
12. It is also contended by the appellant that the direction of
the Kochi Municipal Corporation to execute the lease agreement was
on 16.01.2020 and therefore, Ext. P23 order of the Government dated
31.01.2020 calling upon the appellant to achieve the financial close
within 30 days is illegal and arbitrary. That apart, it is submitted that
the appellant has submitted Ext. P25 reply dated 27.02.2020
explaining the delay in achieving the financial close. But, even after
receipt of Ext. P25, the State Government has not taken any steps to
see that the first respondent executes a lease agreement enabling the
W.A. No. 1685/2020 & 1579/2021 : 12 :
appellant to satisfy the financial institution with regard to its
repayment capacity. It was in the aforesaid background the appellant
had submitted Ext. P25 representation dated 27.02.2020 to the State
Government which passed Ext. P34 order declining the request made
therein. These are the basic background facts available before us to
consider the case put forth by the appellant.
13. The State Government has filed a detailed counter affidavit
in the appeal disputing the allegations and the claims and demands
raised by the appellant. According to the State Government, it was by
virtue of the Government Order, G.O. (Ms.) No. 260/2013/LSGD dated
20.07.2013 that the State Government accorded sanction to instal the
solid waste management plant at Brahmapuram based on the Thermal
Technologies (Waste to Energy Project) and thereupon, the Kerala
Industrial and Technical Consultancy Organization Ltd. (KITCO) was
appointed as the transaction advisor for the implementation of the
project. Consequent thereto, the appellant had participated in the
tender process and by Ext. P1 Government Order dated 04.01.2016,
the Government of Kerala approved the project of the appellant,
submitted by the KITCO for a total cost of Rs.295 Crores, subject to
the conditions enumerated therein. It is also submitted that
consequently, orders and agreements were executed by and between
the Kochi Municipal Corporation and the appellant. The paramount
W.A. No. 1685/2020 & 1579/2021 : 13 :
contention advanced by the State Government is that as per Article 3
of the concession agreement executed on 17.02.2016, the award of
the concession shall be subject to the satisfaction of the waiver of the
conditions precedent, enumerated in the agreement, and going by
Article 3.1(a)(vii) of the concession agreement, the concessionaire
shall furnish its financing plan and financing documents for the project
and demonstrate financial close. Further, it is stated that as per clause
3.1(b) of the concession agreement, the authority shall hand over
physical possession of the project site for the purpose of the project
and that as per Article 3.2 of the concession agreement, the conditions
precedent shall be complied within 180 days of the date of agreement
i.e., 17.02.2016, wherein it is stipulated that each party shall promptly
inform the other party, in writing, as to when the conditions precedent
for which it is responsible, have been satisfied.
14. It is pertinently pointed out that by virtue of Article 3.3. of the
concession agreement, any conditions precedent as contemplated in
Articles 3.1(a) and 3.1(b) of the concession agreement may be waived
by the authority at any point of time in its sole discretion. Relying upon
Article 21.8 of the concession agreement, it is submitted that no
waiver of any term or condition or breach thereof by any party thereto
shall be valid, unless expressed in writing and is signed by such party
and communicated to the other. Therefore, according to the State
W.A. No. 1685/2020 & 1579/2021 : 14 :
Government, there is no implied waiver or any waiver by way of
conduct, and to the knowledge of the State Government, the Kochi
Municipal Corporation has not waived any of the conditions precedent
as contemplated under Article 21.8 of the concession agreement.
15. Relying upon Article 3.6 of the concession agreement, it is
contended that if the conditions precedent are not complied with within
the time, including the extended time, if at all any, the concession
agreement shall be liable to be terminated, and by virtue of the
provisions of Article 3 of the concession agreement, the party in
default has to compensate the other party of the agreement by way of
liquidated damages at the rate mentioned therein.
16. Therefore, it is submitted that in the event of termination of
the agreement, a remedy is clearly prescribed as per the terms of the
concession agreement and the parties, therefore, have to adhere to
the terms and conditions of the agreement executed by and between
the parties. That apart, it is pointed out that as is evident from Ext. P3
order of the Kochi Municipal Corporation dated 24.06.2017 and Exts.
P4 and P6 orders of the State Government dated 03.02.2018 and
09.08.2018 respectively, the project site having an extent of 8
Hectares of land comprised in Survey Nos. 30,35, 36, 37, 45 and 56 of
Block No. 37 of Puthencruz Village was handed over to the appellant.
Therefore, it is contended that the authority has satisfactorily complied
W.A. No. 1685/2020 & 1579/2021 : 15 :
with its condition precedent as is contemplated under Article 3.1(b) of
the concession agreement and has intimated the same to the
concessionaire.
17. So much so, it is submitted that, even though Exhibit P8 request
of the appellant dated 29.02.2016 to execute the lease agreement in
respect of the concession agreement was declined by the Kochi
Municipal Corporation, since the implementation of the project is of
utmost public importance in pursuance to the policy of the State
Government, the State Government, by Ext. P22 order dated
16.01.2020 directed the Kochi Municipal Corporation to execute the
lease agreement as is sought for by the appellant. But, the appellant
and the first respondent, Kochi Municipal Corporation, has not acted
upon Ext. P22 Government Order and no lease agreement or deed
was executed by and between the said parties.
18. It is also contended that as on the date of Ext. P22
Government Order, though substantial time has elapsed, the appellant
did not inform the authority in writing as to whether the appellant had
satisfied or complied with the conditions precedent, in contemplation
of Article 3.1(a) of the Concession agreement, more particularly those
contained under Article 3.1(a)(vii). Instead, the appellant had
approached the State Government and informed that the appellant
requires the mechanism for payment to meet the expenses over and
W.A. No. 1685/2020 & 1579/2021 : 16 :
above the tariff fixed by the Kerala State Electricity Regulatory
Commission to overcome the hurdles for achieving the financial close
and it was based on the said request, the State Government, by Ext.
P23 dated 31.03.2020, formulated a mechanism for payment to meet
the expenses over and above the power tariff to the appellant.
19. That apart, it is pointed out that since the appellant had not
attained the financial close, the State Government directed the
appellant to achieve the financial close within 30 days from the date of
Ext. P23, however, with a rider that necessary action shall be initiated
to terminate the concession agreement, on the concessionaire failing
to do so. Anyhow, on receipt of Ext. P23, the appellant submitted Ext.
P25 representation before the Government inter alia informing that the
appellant requires 100% State Government Guarantee for debt fund
approval of NABARD, so as to achieve the financial close.
20. Apart from the same, the appellant has also sought for a
further relaxation of time, which are outside the scope, ambit and
purview of the concession agreement and that the matter was
considered by the State Level Advisory Committee, in its meeting held
on 13.03.2020, and observed that since the appellant has not achieved
the financial close, the concession agreement cannot be converted to
lease agreement. Therefore, it is submitted that it was in the above
background that the State Government has issued Ext. P28 order
W.A. No. 1685/2020 & 1579/2021 : 17 :
dated 30.04.2020 cancelling Ext. P1 approval granted to the project
and thereby, directing the Kochi Municipal Corporation to terminate the
concession agreement with a further direction to float a RFP for
Brahmapuram project. Other contentions are also raised by the State
Government justifying its stand adopted in Ext. P28 order impugned in
the writ petition.
21. W.A.No. 1579 of 2020 is filed by the Kochi Municipal
Corporation basically contending that the learned single Judge was not
correct in finding that the writ petition itself is not maintainable, since
the subject matter is in regard to the contractual aspects and disputed
questions of facts and no public interest is involved in the matter. That
apart, it is also contended that the writ petition is barred by the
principles of res judicata and the appellant company is estopped from
filing a writ petition, since it has filed W.P.(C) No. 9872 of 2020
seeking the similar reliefs; however, the same was disposed of by this
Court without granting the reliefs sought for and directing the State
Government to take a decision in the representations submitted by the
appellant. Therefore, it is submitted that the reliefs sought for in the
said writ petition are deemed to be declined, and they cannot be
resurrected by filing a fresh writ petition.
22. We have heard learned Senior Counsel for the appellant Sri.
W.A. No. 1685/2020 & 1579/2021 : 18 :
P. Wilson assisted by Adv. George Varghese Perumpallikuttiyil, learned
Senior Advocate Sri. Ranjit Thampan for the Corporation of Kochi and
the learned Senior Government Pleader Sri. S. Kannan for the State
Government, and perused the pleadings and materials on record.
23. The paramount contention advanced by the learned Senior
Counsel for the appellant is that since the project site agreed upon as
per Article 1.1 of the concession agreement was not physically handed
over to the appellant, it cannot be found fault with for not attaining the
financial close in contemplation of Article 3.1(a)(vii). It is also
contended that in order to secure financial assistance from the
financial institutions, a lease has to be executed by the Kochi Municipal
Corporation with the approval of the State Government, which
situation was realised by the State Government evident from Ext. P22
order. However, the Government, later, resiled from the same, without
assigning any reasons. It is also the case of the appellant that the
purpose of Article 3.1(b) is a condition precedent to be performed by
the Corporation so as to compel the appellant to comply with the
conditions precedent under clause 3.1(a)(vii) of the concession
agreement; that as per Ext. P3 dated 24.06.2017, the Corporation
only forwarded the boundary fixed survey sketch to the appellant and
out of the total land measuring 809.4 Ares allotted, only 257.6 Ares
W.A. No. 1685/2020 & 1579/2021 : 19 :
was dry land and the balance was wet land guided by the provisions of
the Act, 2008; and therefore, exemption from the Government was
necessary even for taking possession of the land for the project. It is
further argued that the Government has issued Ext. P4 order dated
03.02.2018 exempting the land from the purview of the Act, 2008 with
a deduction of 55.18 Ares.
24. It is further contended that the above aspects would show
that the Kochi Municipal Corporation has not complied with Article
3.1(b) by handing over the possession of the land and hence, financial
close has been deemed to be achieved. That apart, it is submitted that
when the State Government, as per Ext. P22 Government Order,
cancelled the decision of the Kochi Municipal Corporation in regard to
the request made by the appellant for the execution of the lease
agreement and directed to execute a lease agreement in respect of
the concession agreement, according to the learned Senior Counsel,
the concession agreement has become redundant and unenforceable.
25. It is further submitted that the State Level Advisory
Committee, the 4th respondent, was satisfied with the necessity of
executing the lease agreement for the implementation of the project
and recommended to the Government to that effect as per Exts. P9
and P10 decisions, in which the Secretary of the Kochi Municipal
W.A. No. 1685/2020 & 1579/2021 : 20 :
Corporation was a party and therefore, the Municipal Council was not
entitled to retract from the decision taken by the State Level Advisory
Committee; and in fact, the Government has acted upon the decisions
taken by the State Level Advisory Committee and after understanding
the intrinsic aspects preventing the appellant from proceeding with the
project alone, Ext. P22 order was issued cancelling the decision taken
by the Kochi Municipal Corporation declining the request for the
execution of a lease agreement.
26. It is also contended that Ext. P28 order issued by the State
Government and Ext. P29 notice issued by the Kochi Municipal
Corporation withdrawing the approval and cancelling the contract is in
violation of Article 16 of the concession agreement, in view of the
covenants contained under Article 16.1 providing a methodology for
the termination procedure by issuing notice in writing of at least not
less than 90 days and not more than 180 days. Therefore, it is
submitted that in the instant case, there was lack of compliance of the
procedure by the State Government as well as the Kochi Municipal
Corporation and therefore, the entire action of the State Government
as well as the Kochi Municipal Corporation are arbitrary, illegal and
violative of the principles of natural justice, liable to be interfered with
by this Court under Article 226 of the Constitution of India.
W.A. No. 1685/2020 & 1579/2021 : 21 :
27. In that regard, the learned Senior Counsel has relied upon
the judgment of the Apex Court in Vice-Chairman & Managing
Director, City and Industrial Corporation of Maharashtra Ltd.
vs. Shirir Realty Pvt. Ltd. (2022 (1) KHC SN 4 (SC), wherein it is
held that providing effective natural justice to parties to a contract or
awardee of tender is necessary to maintain Rule of Law. He has also
relied upon the decision of the Hon'ble Apex Court in ABL
International Ltd. v. Export Credit Guarantee Corporation of
India (2004) 3 SCC 553, wherein it is held that in an appropriate
case, a writ petition as against a State or an instrumentality of a State
arising out of a contractual obligation is maintainable.
28. In regard to the contentions raised by the respondents that
the writ petition in question is barred by the principles of res judicata,
it is submitted that the learned single Judge, as per Ext. P32 judgment
in W.P.(C) No. 9872 of 2020, has made an open remand of the issues
at dispute, while directing the State Government to pass orders on
Ext.P31 representation, in which a review of all the impugned orders
were sought for. Therefore, it is contended that when the State
Government has passed a fresh order, acting upon the representation,
a fresh cause of action arose and therefore, the principles of res
judicata would not be attracted. In that regard, the learned Senior
W.A. No. 1685/2020 & 1579/2021 : 22 :
Counsel has relied upon the judgment of the Apex Court in Asgar and
others v. Mohan Varma and Others [2020 (16) SCC 230],
wherein it is held that in deciding as to whether a matter might have
been urged in the earlier proceedings, the court must ask itself as to
whether it could have been urged and in deciding whether the matter
ought to have been urged in the earlier proceedings, the court will
have due regard to the ambit of the earlier proceedings and the nexus
which the matter bears to the nature of the controversy. Other
contentions are also raised to canvas the proposition that the
impugned orders are not sustainable under law, justifying interference
of the writ court.
29. On the other hand, the learned Senior Counsel for the
Corporation of Kochi addressed arguments basically relying upon
clause 3 of the concession agreement. It is also pointed out that the
contention advanced by the learned Senior Counsel for the appellant
that the termination procedure was not followed in contemplation of
clause 16, is not sustainable for the reason that it is applicable when a
termination is made otherwise than in accordance with the other
provisions of the agreement, but shall not include expiry of agreement
due to efflux of time in a normal course. That apart, it is pointed out
that the said clause clearly specifies various methods in regard to the
W.A. No. 1685/2020 & 1579/2021 : 23 :
termination of the agreement, especially the termination of the
agreement due to efflux of time in a normal course. It is also pointed
out by the learned Senior Counsel for the Kochi Municipal Corporation
that the mandatory requirement of financial close contained under
clause 3.1(a)(vii) is an independent covenant from the other
provisions of the agreement and also a condition precedent and
therefore, the appellant is not entitled to advance arguments by
making it adaptable to other provisions of the agreement.
30. It is also the contention of the learned Senior Counsel that
the appellant company has failed to achieve the milestones in
accordance with the provisions of the concession agreement and in
spite of an opportunity given to the appellant, it has not made any
earnest efforts to make the project of State Government as well as the
Municipal Corporation a reality. That apart, it is contended that there
was no agreement entered into by and between the parties for the
execution of the lease agreement in order to secure financial support
from the financial institutions by mortgaging the leasehold rights and
therefore, the contention advanced by the learned Senior Counsel for
the appellant, relying upon the orders passed by the State
Government in regard to the lease agreement, cannot be sustained
under law.
W.A. No. 1685/2020 & 1579/2021 : 24 :
31. It is further pointed out that the benefits under the
electricity tariff were offered by the Government as per Ext. P23
Government Order dated 31.01.2020 on condition that, appellant
achieves the financial close within 30 days from the aforesaid date and
therefore, the appellant is not entitled to make out a case relying upon
such benefits offered by the State Government. Arguments were
advanced by the learned Senior Counsel that the present writ petition
is barred by the principles of res judicata, relying upon various
judgments of the Apex Court.
32. The State has also filed an argument note, basically
supporting the contentions advanced by the Kochi Municipal
Corporation and relying upon the relevant clauses of the concession
agreement.
33. We have evaluated the rival submissions made across the
Bar. In fact, along with the writ appeal, the entire concession
agreement is produced: whereas, in the writ petition only the material
portion of the concession agreement was produced. Since the
predominant contention advanced by the learned Senior Counsel for
the appellant is that the impugned orders are violative of the principles
of natural justice and arbitrary and illegal, our primary endeavour is to
find out as to whether the learned single Judge has committed any
W.A. No. 1685/2020 & 1579/2021 : 25 :
jurisdictional error in the matter of considering the aforesaid legal
position.
34. Before going into the intricacies of the concession
agreement executed by and between the parties, we are of the
considered opinion that the circumstances leading to the issuance of
Ext. P28 Government Order dated 30.04.2020 is required. The
Government has taken note of the factual circumstances leading to
the execution of the concession agreement and other aspects and it is
stated therein that the Director of the appellant, as per letter dated
11.10.2018, requested that the company requires the balance of
payment mechanism to meet the expenses over and above the power
tariff fixed by the Kerala State Regulatory Commission to overcome
the hurdles for achieving the financial close.
35. Therefore, it is stated that, it was accordingly that the State
Government issued an order dated 31.01.2020 satisfying the mode of
payment of the expenses over and above the power tariff fixed by the
Kerala State Electricity Regulatory Commission. But, it is clearly
specified that it was ordered so on condition that the appellant
achieves the financial close within 30 days from the date of order and
failing which it was strictly cautioned that action will be initiated to
terminate the concession agreement in accordance with the terms and
conditions of the agreement. The Government has also noted that in
W.A. No. 1685/2020 & 1579/2021 : 26 :
spite of the due consideration shown and further time granted to
achieve the financial close, the appellant Company did not make any
offer to comply with the directions issued by the Government.
36. It was thereupon that the Government verified the relevant
covenants contained in the concession agreement and arrived at the
conclusion that the approval granted to the project is required to be
cancelled and the Secretary of the Kochi Municipal Corporation was
directed to terminate the concession agreement following the
procedure laid down in Article 16 of the agreement. Therefore, on a
deep seated analysis of Ext. P28 impugned Government Order, it is
unequivocal that the Government has considered every minute
aspects before taking a decision, and at present there was no other
alternative for the Government than to withdraw the approval granted
to the project submitted by the appellant.
37. Now coming to Ext. P29 notice of termination dated
04.05.2020 issued by the Kochi Municipal Corporation, what we could
gather is that even after 1400 days of execution of the agreement, the
concessionaire i.e., the appellant, could neither submit the financial
close, nor specify the source of funds required for the completion of
the project. Therefore, the Cochin Municipal Corporation doubted the
capacity of the appellant to complete the project. The Corporation was
also of the opinion that relaxation and additional support like
W.A. No. 1685/2020 & 1579/2021 : 27 :
conversion of agreement and Government guarantee etc., which are
not part of the concession agreement, show that the appellant is not
having sufficient financial resources in order to carry on with the
project. Therefore, the Corporation found that since the appellant
failed to achieve the financial close as per Article 3.3. of the concession
agreement within 180 days from the date of agreement or within the
extended period, Article 3.6 will automatically apply as the conditions
therein are not waived by the authority and therefore, the agreement
stand cancelled by virtue of the imperative nature of Article 3.6 of the
concession agreement.
38. Therefore, relying upon the procedure prescribed under
Article 3 of the agreement, it is contended that the termination
procedure contemplated under Article 16 of the concession agreement
is not at all required.
39. Now coming to Ext. P34 order dated 05.06.2020 passed by
the State Government on the basis of the directions issued by a
learned single Judge of this Court in Ext. P32 judgment dated 13th May,
2020 in W.P.(C) No. 9872 of 2020, the Government considered the
entire aspects put forth by the appellant, relying upon the terms and
conditions of the concession agreement. However, it was found that
the concessionaire i.e. the appellant, cannot implement the project
even if more time is allowed and it was accordingly that the
W.A. No. 1685/2020 & 1579/2021 : 28 :
Government declined the review of its Ext. P28 order.
40. Therefore, on an analysis of the orders impugned by the
appellant in the writ petition, it is clear that the Government has
taken into consideration the entire aspects under the concession
agreement and the circumstances leading to the withdrawal of the
approval, and cancellation of the contract by the respective authority.
It is also evident from Ext. P23 order dated 31.01.2020 that the
Government has granted a further 30 days' time from the date of the
said order to the appellant to achieve the financial close and on failure
of the same only, the termination of the concession agreement was
proposed.
41. It is an admitted fact that the appellant failed to achieve the
financial close within the extended period and it was thereupon that
Ext. P28 order was passed by the State Government withdrawing the
approval and consequently, termination order was passed by the Kochi
Municipal Corporation.
42. Insofar as the concession agreement executed by and
between the parties is concerned, it is executed by and between the
Kochi Municipal Corporation and the appellant in order to satiety the
requirement of the Municipal Solid Waste (Management and Handling)
Rules, 2000, whereby it is made mandatory; for every municipal
authority to implement a Scientific Solid Waste Management System,
W.A. No. 1685/2020 & 1579/2021 : 29 :
wherein the Municipal solid waste is duly processed and only inorganic
waste and processed residues are disposed in a landfill.
43. Therefore, the introductory clause of Annexure A concession
agreement shows that the timely completion of the project was a vital
requirement. 'Financial close' is defined under the agreement to
mean, the date on which the Financing Documents providing for
Financial Assistance by the Lenders, Equity Documents and the
documents in respect of debt, if any, committed by the Consortium
have become effective and the concessionaire has access to such
financial assistance. 'Financing Documents' are defined under the
agreement to mean, collectively, the documents executed in favour of
or entered into with the lenders, by the Concessionaire in respect of
the Financial Assistance relating to the financing (including any re-
financing) of the Actual Project Cost and includes any document
providing security for the Financial Assistance.
44. 'Conditions precedent' is defined to mean the conditions
prescribed in Article 3 of the agreement.
45. Therefore, on an analysis of the terminologies employed
under the agreement as to the financial close, financial documents and
the conditions precedent, it is clear that the entire responsibility in the
matter of achieving the financial close as a condition precedent is upon
the appellant .
W.A. No. 1685/2020 & 1579/2021 : 30 :
46. Now we proceed to consider the impact of Article 3 of the
concession agreement dealing with the conditions precedent. Article
3.1 clearly specifies that the award of the concession shall be subject
to the satisfaction or waiver of the conditions precedent delineated
therein. Article 3.1(a)(vii) clearly specifies that; furnishing its
Financing Plan and Financing Documents for the Project and
demonstrating financial close is upon the appellant; however provided
that financial close shall be deemed to be achieved, if the only
conditions pending for achieving financial close are those which are
required to be fulfilled by the Authority under Article 3.1(b)
thereunder.
47. Article 3.1(b) clearly specifies a condition precedent, which
shall be satisfied by the authority by handing over the physical
possession of the project site for the purpose of the project.
'Authority' is defined under the concession agreement to mean, Kochi
Municipal Corporation. Therefore, subject to the handing over the
physical possession of the project site for the purpose of the project,
the financial close had to be achieved by the appellant within 180 days
of the date of agreement. 'Project site' is defined under the
concession agreement to mean the land handed over to the
concessionaire by the authority for the project, out of the 8 (eight)
Hectares of land earmarked at Brahmapuram as shown in the Drawing
W.A. No. 1685/2020 & 1579/2021 : 31 :
No.TS-35SP DRG 01 001 for the processing and disposal of MSW
(more fully described in Schedule-I).
48. Therefore, it is clear from the description of project site
that; it is the handing over to the concessionaire ie. the appellant by
the Kochi Municipal Corporation the land from and out of 8 Hectares of
land earmarked at Brahmapuram as shown specifically in the drawing.
49. On a perusal of Schedule 1 attached to the concession
agreement, it is clear that the project is proposed to be developed at
Brahmapuram, wherein the Kochi Municipal Corporation owns about
110 acres of land lying adjacent to the Brahmapuram Diesel Power
Plant and the site area is 8 Hectares of land earmarked at
Brahmapuram as shown therein specified above and attached in Article
9 dealing with 'payments to the authority'.
50. Therefore, it is clear that the obligation created as per
Article 3.1(b)(i) is satisfied by the authority i.e., the Kochi Municipal
Corporation at the time of execution of the concession agreement
itself. Therefore, the contention advanced by the appellant that only a
portion of the land remained as dry was alone handed over, and the
major portion of the land coming under the provisions of the Act, 2008
was not handed over, and it was actually handed over after the
exemption order issued by the Government cannot be sustained. We
do not find much force in the said contention, because no such issue
W.A. No. 1685/2020 & 1579/2021 : 32 :
was raised and pursued by the appellant any time before the
cancellation of the approval and termination of the agreement .
51. On a perusal of Section 10(1) of the Act, 2008, it is clear
that notwithstanding anything contained in Section 3, the Government
may grant exemption as per the provisions of the Act, only if such
conversion or reclamation is essential for any public purpose and shall
notify in the official Gazette. It is true that a procedure is
contemplated to exempt the paddy field for conversion or reclamation.
However, when the authority had handed over the land with the
approval of the State Government to the appellant, the appellant is not
entitled to turn around and contend that the land handed over has
adverse consequences to utilise or convert the same for the purpose of
the project.
52. Moreover, the Government, the authority or the public have
not raised any manner of objection with respect to the hand over of
the land by the Kochi Municipal Corporation to the appellant, much less
an objection against utilisation of a paddy field for other purposes.
Above all, it is clear from Schedule 1 of the agreement that the project
site is a portion of the larger extent of land already in the possession
of the Kochi Municipal Corporation .
53. Therefore, in our considered opinion, merely because the
exemption order was handed over by the Government after
W.A. No. 1685/2020 & 1579/2021 : 33 :
completing the formalities prescribed under Section 10 of the Act,
2008 at a later point of time, that did not detain the appellant from
utilising the land for the implementation of the project in any manner
of, whatsoever, nature added to the fact that the land was handed over
with the approval of the State Government .
54. Now, coming to Article 3.6 of the concession agreement
dealing with the compliance of the conditions precedent, it is clear that
in the event of the conditions precedent are not complied with within
the time (including the extended time, if any) in terms of Articles 3.2
to 3.5, the agreement shall be liable to be terminated and if such
termination is on account of the failure of the concessionaire to comply
with the conditions precedent, the Bid security shall stand forfeited;
however if such termination is on account of failure of the authority,
the authority shall be obliged to return the Bid Security/Performance
Security; but it is clarified that except for the payment as stipulated in
the foregoing Articles 3.4 and 3.5 and forfeiture in Article 3.6, each
party thereto shall have no claims against the other for costs,
damages, compensation or otherwise. Articles 3.3 to 3.5 are relevant
to the context and they read thus:
"3.3 Any of the Conditions Precedent set forth in Articles 3. l(a) may be
waived fully or partially by the Authority at any time in its sole
discretion or the Authority may grant additional time for compliance
with these conditions and the Concessionaire shall be bound to ensure
W.A. No. 1685/2020 & 1579/2021 : 34 :
compliance within such additional time as may be specified by the
Authority. Any of the Conditions Precedent set forth in Articles 3.1 (b)
may be waived fully or partially by the Concessionaire at any time in its
sole discretion.
3.4 If the Concessionaire has fulfilled all the Conditions Precedent
under Article 3.1(a) including the furnishing of the Bank Guarantee and
has not waived or extended the time under Clause 3.3 above, and if the
Authority has failed to fulfill the conditions Precedent to be fulfilled by
it under Article 3.1(b) and which are within the power of the Authority,
the Authority shall be liable to pay liquidated damages in a sum
calculated at the rate of 0.1% (zero point one percent) of the
Performance Security for each day's delay until fulfillment of the
Conditions Precedent subject to a maximum of 5% (five percent) of the
figure mentioned in the Performance Security furnished by the
Concessionaire. In such event, having regard to the quantum of
damages, the time for the performance shall be deemed to have been
extended by the number of days for which the liquidated damages is paid
and if, after the extended period the Authority is still not in a position to
comply with the Conditions Precedent, then the agreement shall be liable
to be terminated as provided for in Clause 3.6 below;
3.5. If the Authority has fulfilled all the Conditions Precedent under
Article 3.1(b) and has not waived or extended the time under Clause 3.3
above, and if the Concessionaire has failed to fulfil the Conditions
Precedent to be fulfilled by it under Article 3.1(a) and which are within
the powers of the Concessionaire, the Concessionaire shall be liable to
pay liquidated damages in a sum calculated at the rate of 0.1% (zero
point one percent) of the Performance Security for each day's delay until
fulfillment of the Conditions Precedent subject to a maximum of 5%
(five percent) of the figure mentioned in the Performance Security
furnished by the Concessionaire. In such event, having regard to the
quantum of damages, the time for the performance shall be deemed to
have been extended by the number of days for which the liquidated
damages is paid and if, after the extended period the Concessionaire is
still not in a position to comply with the Conditions Precedent, then the
W.A. No. 1685/2020 & 1579/2021 : 35 :
agreement shall be liable to be terminated as provided for in Clause 3.6
below,"
55. Therefore, on a conjoint reading of the definition given in the
concession agreement, the significant provisions discussed above and
Article 3 of the concession agreement, it is clear that the liability cast
upon the appellant as well as the Kochi Municipal Corporation under
Article 3 of the agreement is independent of the other provisions of the
concession agreement and the parties were duty bound to attain the
targets fixed therein, irrespective of the other covenants agreed upon
by and between the parties.
56. Yet another feature that is significant to be discussed is
Article 6, dealing with the project implementation. Article 6.3 dealing
with construction phase, stipulates that the concessionaire shall
promptly commence and complete the works, including installation of
equipment in accordance with the Project Schedule and shall also
obtain from the independent Engineer a certificate as to the
completion of the construction of Project Facilities and Services in
accordance with the provisions of the agreement not later than 18
months from the date of commencement of the concession period.
Concession agreement is dated 17th day of February, 2016.
57. Therefore, it is clear that a time bound action from the part
of the concessionaire was an essential condition of the contract by and
W.A. No. 1685/2020 & 1579/2021 : 36 :
between the parties, failing which termination was axiomatic in terms
of the termination clause contained under Article 16 of the agreement,
due to efflux of time. Article 6.4 deals with obligations of the
concessionaire and Article 6.4(b) makes it clear that the
concessionaire shall, at its cost, expenses and risk make such
financing arrangements as would be necessary to implement the
project and to meet all of its obligations under the agreement, in a
timely manner.
58. Article 6.4(c) makes it clear that the concessionaire shall
give notice to the authority within 7 days of any material modification
or change to any of the Financing Documents and or any equity
documents and shall simultaneously therewith also furnish copies of
such modified/amended documents to the authority. The proviso
thereto makes it clear that no such modification/amendment will be
made if it in any manner, whatsoever, has the effect of imposing an
additional financial obligation or increasing the financial obligation of
the authority in addition to that contemplated under the financing
document provided on financial close, without the prior written
consent of the authority. It was further made clear thereunder that
any such modifications/amendments made without the prior written
consent of the authority will not be enforceable against the authority.
59. We are relying upon the said Article for the basic reason
W.A. No. 1685/2020 & 1579/2021 : 37 :
that the concession agreement as it remains, is a licence deed, and
there is no covenant executed by and between the parties that in
future a lease agreement would be executed by and between the
parties so as to enable the appellant to mortgage the leasehold rights
and secure the financial facilities from any financial institution.
Therefore, the contention advanced by the appellant that it was due to
the failure on the part of the Kochi Municipal Corporation that the
property could not be mortgaged and finance secured from willing
financial institutions, has no force of law in absentia of any such
imperatives in the agreement. Such a contention, in our view, is also
clearly outside the spirit of the agreement executed by and between
the parties, and therefore the attempt of the appellant to make out a
case from a totally strange resource cannot be sustained at all legally
and factually.
60. Again, coming to Article 15 dealing with events of default,
Article 15.1 specifies that the event of default shall mean either
concessionaire event of default or the authority event of default or
both as the context may admit or require. Clause (a) thereto
describes the concessionaire event of default, which stipulates that the
concessionaire shall not be considered to be in breach of its obligations
under the agreement, nor shall it incur or suffer any liability if and to
the extent performance of any of its obligations under the agreement
W.A. No. 1685/2020 & 1579/2021 : 38 :
is affected by or on account of (I) force majeure event, subject to
Article 14.7; (ii) the Authority Event of Default; (iii) compliance with
the instructions of the independent Engineer/the authority or the
directions of any Government Authority other than instructions issued
to a consequence of a breach by the concessionaire of any of its
obligations thereunder; and (iv) closure of the Project Facilities or part
thereof with the approval of the Independent Engineer/the authority.
61. Therefore, it can be seen that the appellant cannot be heard
to say that there was any such intervening event to hold that the
concessionaire shall not be considered to be in breach of its obligations
under the agreement. So much so, under the sub-head thereto, the
events that constitute an event of default by the concessionaire are
delineated and they read thus:
a) the Concessionaire's failure to perform or discharge any of its
obligations in accordance with the provisions of this
Agreement.
b) the Performance Security is not maintained in terms of the
provisions thereof.
c) construction at the Project site is abandoned for a period more
than 90 (ninety) days during the Construction Phase:
(i) The Concessionaire has failed to adhere to the Construction
Requirements and such failure, in the reasonable estimation of the
Independent Engineer, is likely to delay achievement of Date of
Commercial Operations beyond 90 (ninety) days of the Scheduled
W.A. No. 1685/2020 & 1579/2021 : 39 :
project Completion Date... "
62. On a consideration of the specifications made thereto, it is
clear that the concessionaire's failure to perform or discharge any of
its obligations in accordance with the provisions of the agreement shall
be treated as an event of default. Therefore, there are clear provisions
contained under the concession agreement to deal with and tackle the
situations that occur during the currency of the agreement executed
by and between the parties.
63. Now coming to Article 16 dealing with termination of the
concession agreement, it enables the parties entitled to terminate the
agreement on account of a Force Majeure Event or on account of an
event of default shall do so by issue of a notice in writing ("Termination
Notice") to the other party and simultaneously deliver a copy thereof
to the lenders. Therefore, it is clear that under the aforesaid two
circumstances alone, Article 16 comes into play and thereby, the
procedure mandated thereunder would operate in the matter of
termination of the agreement. This we say because, the paramount
contention advanced by the Kochi Municipal Corporation is that the
termination procedure contained under the said article of the
concession agreement would not come into operation for the basic
reason that the appellant has not attained the financial close as is
W.A. No. 1685/2020 & 1579/2021 : 40 :
undertaken under the agreement.
64. Taking into account the aforesaid factual and legal aspects,
and the specific contractual terms and conditions entered into by and
between the parties, we are of the opinion that since the appellant has
not achieved the financial close, the Government was at liberty to
withdraw the approval given to the Kochi Municipal Corporation to
execute the concession agreement and the Kochi Municipal Corporation
consequently was at liberty to take a decision with respect to the
termination of the agreement. It is clear from the impugned
Government Order as well as the notice of the Kochi Municipal
Corporation that the termination was made due to the failure on the
part of the appellant to achieve the financial close in contemplation of
the concession agreement executed by and between the parties which
is a condition precedent. Therefore, we have no doubt in our mind to
hold that when there are specific, imperative and mandatory
conditions in a contract obligating a party to discharge a condition
precedent to proceed with the contract, the said consenting party has
to discharge the said essential condition which is the essence of
contract.
65. We are also of the view that even the Government has
extended the period to achieve the financial close as per Ext. P23
order dated 31.01.2020 by a period of 30 days and had rendered an
W.A. No. 1685/2020 & 1579/2021 : 41 :
opportunity to achieve the financial close. But, in spite of the same,
the appellant has not made any effort. It is also clear from the
concession agreement that the appellant was liable to pay the
electricity tariff in accordance with the tariff fixed by the Kerala State
Electricity Regulatory Commission. However, the concession was
extended as per Ext. P23 order, subject to the condition that the
appellant achieves the financial close within 30 days prescribed under
the said order. Admittedly, the appellant was unable to attain the
financial close and therefore, the arguments advanced by the appellant
relying upon the concession made in Ext. P23 order cannot be
sustained under law., especially due to the fact that it was not at all a
part of the concession agreement.
66. The contention advanced by the appellant that no
opportunity was provided to the appellant before the withdrawal of the
approval and termination of the agreement, also cannot be sustained
for the reason that the representation submitted by the appellant
before the Government was considered elaborately by the
Government and Exhibit P23 order was passed by the Government
after taking into account the entire pros and cons involved in the
subject matter and also granting adequate time to achieve the
'Financial Close'.
67. Moreover, as per the direction issued by a learned single
W.A. No. 1685/2020 & 1579/2021 : 42 :
Judge in Ext. P32 judgment , the Government reconsidered the
matter and has issued Ext. P34 order impugned, after providing an
opportunity of hearing in the representation of the appellant, and also
hearing the Kochi Municipal Corporation.
68. Therefore, we find that the conclusion arrived at by the
learned single Judge in the impugned Judgment to decline the prayers
sought for by the appellant to quash the impugned orders/notice is in
accordance with law and require no interference, since we find that
there was no manner of illegality, arbitrariness or other legal infirmities
justifying interference in a writ proceeding under Article 226 of the
Constitution of India.
69. Now coming to the appeal filed by the Kochi Municipal
Corporation, we are of the considered opinion that the learned single
Judge had to enter into the findings contained thereunder in the
process of identifying as to whether there was any illegality,
arbitrariness or violation of the principles of natural justice, thus
creating cause of action for filing a writ petition. We are also of the
view that, in so far as the contention that Ext. P32 judgment rendered
by the learned single Judge would create res judicata in the filing of
the writ petition in question, the same cannot be sustained for the
basic reason that the learned single Judge directed the State
Government to reconsider the withdrawal of the approval by taking
W.A. No. 1685/2020 & 1579/2021 : 43 :
into account the representation submitted by the appellant and it was
after hearing the parties and re-appreciating the entire documents and
the terms and conditions of the concession agreement, it has arrived
at the independent findings in Exhibit P34, and therefore, the
appellant, if aggrieved, was at liberty to challenge the said
Government Order as of right, since it creates a new cause of action
and in that process, the previous order of the State Government ie.,
Exts. P28 order and Ext. P29 termination notice of the Kochi Municipal
Corporation, were also liable to be challenged. Therefore, we do not
find any merit in the appeal filed by the Kochi Municipal Corporation.
Upshot of the above discussion is that both the appeals are
dismissed.
sd/-
S. MANIKUMAR,
CHIEF JUSTICE.
sd/-
SHAJI P. CHALY,
JUDGE.
Rv
W.A. No. 1685/2020 & 1579/2021 : 44 :
APPENDIX of W.A. NO. 1685/2020
APPELLANT'S ANNEXURES:
ANNEXURE A: TRUE COPY OF CONCESSION AGREEMENT DATED 17.02.2016.
ANNEXURE b: TRUE COPY OF REQUEST FOR PROPOSAL ISSUED BY THE 5TH
RESPONDENT.
ANNEXURE 1: TRUE COPY OF THE GOVERNMENT ORDER GO(RT.) NO.
1754/2021/LSGD DATED 14.09.2021 ISSUED BY THE THIRD RESPONDENT.
ANNEXURE 2: TRUE COPY OF THE NOTICE NO. CML-EE1-AEEVI/WTE-
BRAHMAPURAM/2021-22-207 DT. 07.10.2021 ISSUED BY THE KERALA ELECTRICITY
BOARD LIMITED.
ANNEXURE 3: TRUE COPY OF REPLY DATED 28.10.2021 ISSUED BY THE WRIT
APPELLANT TO THE KERALA STATE ELECTRICITY BOARD LIMITED.
RESPONDENTS' ANNEXURES: NIL
/True Copy/
PS To Judge
rv
