M/S. Gmr Ads vs The State Of Telangana And 4 Others
2022 Latest Caselaw 2032 Tel

       HON'BLE SMT. JUSTICE LALITHA KANNEGANTI

                  WRIT PETITION No. 32603 of 2021

O R D E R:

This Writ Petition is filed to declare the action of the

2nd respondent in transferring / assigning the obligations under

the Authorization Agreement dated 26.10.2017 in favour of the

5th respondent as contrary to the Agreement and the same is

illegal, arbitrary, against the principles of natural justice and

violative of Articles 14, 19(1)(g), 21 and 300-A of the

Constitution of India. A consequential direction is sought to set

aside the letter dated 17.11.2021.

2. Learned Senior Counsel Sri A. Sudarshan Reddy

appearing on behalf of M/s Pillix Law Firm submits that the 2nd

respondent had issued tender notification dated 05.10.2016 for

construction of Foot Over Bridges (FOBs.) at various locations of

Hyderabad under PPP mode on a commercial format and along

with the said notification, the 2nd respondent had issued request

for proposal (RFP) by providing standards, specifications, design

guidelines and maintenance and performance standards to be

adhered to by the bidder. It is stated that the petitioner after

verifying the details of the project, which was provided in the

tender notification dated 05.10.2016, had participated in the

competitive bidding and the petitioner was found to be the

preferred bidder as it has quoted the lowest authorization period

for the development of modern FOB. It is also stated that the

petitioner was awarded to execute the construction of FOBs. as

per the Letter of Intent and an agreement was entered on

26.10.2017 for two FOBs. at Sujana Forum Mall and Temple

Bus Stop, Kukatpally. It is stated that the petitioner

commenced the work and completed the structure as per the

standards specifications, designs, guidelines on 16.11.2019

within seven months from the date of handing over the same. It

is stated that further, by letters dated 16.08.2017, 11.01.2018,

09.10.2020 and 01.11.2021, the petitioner had asked

Respondents 3 and 4 to increase the tenure of the authorization

period in view of the project complexities involved as per Article

5, Obligations of Parties, Section 5.1(d) & (e) of the

Authorization Agreement, but for the best reasons known to

Respondents 3 and 4, they did not choose to act upon the

above-said letters. It is stated that the petitioner had invested

huge amounts for completion of project and before the petitioner

could commence commercial operations, COVID-19 pandemic

started and the petitioner suffered huge setbacks in terms of

revenue generation from the project. It is stated that

surprisingly, the petitioner was served with an intimation letter

dated 12.11.2021 wherein it is stated that the 2nd respondent

approved transfer of FOBs. from the administrative control of

Respondents 3 and 4 ie. Project Wing to the 5th respondent i.e.

Advertisement Wing with effect from 10.11.2021. It is further

stated that the FOBs. constructed by the petitioner are now

under the administrative control of the 5th respondent and that

all the matters relating to FOBs. will be dealt with by the 5th

respondent and all the communications pertaining to the said

FOBs. shall only be made with the 5th respondent. Learned

Senior Counsel submits that the said action of Respondents 2 to

4 and the letter issued by the 5th respondent is contrary to the

terms of the Agreement and unilaterally the respondents cannot

alter the terms of the Agreement. It is submitted that as per

clause 17.4(b) of Article 17 of the Authorization Agreement

which reads as under:

" No amendment or modification or waiver of any provision of this Agreement, nor consent to any departure by any of the parties there from shall in any event be valid and effective unless the same is in writing and singed by the parties or their duly authorized representatives especially empowered in this behalf and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which it is given."

there cannot be waiver of any of the provisions of the

Authorization Agreement nor consent for departure by any of

the parties unless the same is in writing and signed it is not

valid. He submits that the particular action of the respondents

in straightaway issuing this notice is contrary to the said

Agreement. He also relied on clause 11.2(h) of Article 11 and

submits that the rights and interest of the petitioner in the

project will pass to Respondents 2 to 4 after the transfer date

which is on completion of the authorization period. Hence, it is

submitted that the obligation of the parties to the agreement will

be entangled between the parties and cannot be either

transferred or assigned and cannot be transferred in a manner

unknown to law. Learned Senior Counsel relying on the

judgment of the Apex Court in Kapilaben v. Ashok Kumar

Jyantilal Sheth Trough PoaGophalbhai Madhusudan Patel1

submits that the letter impugned in the Writ Petition is not only

in violation of the Agreement but also unethical for the reason

that the 5th respondent who is holding the post of Additional

Commissioner (Advertisements), GHMC is also holding the post

of The Director, Enforcement Vigilance and Disaster

Management and he has levied several challans to the FOBs.

2019 SCC Online SC 1512

alleging the advertisement on the FOBs. as illegal in spite of the

fact that the petitioner is having Authorization Agreement

granted by Respondents 2 to 4. It is submitted that the 5th

respondent was so prejudiced against the petitioner and started

issuing challans on daily basis. The petitioner has challenged

the said challans issued by the 5th respondent by filing several

Writ Petitions before this Court. He submits that in spite of the

categorical findings of the Hon'ble High Court, the 5th

respondent is still continuing to issue challans on the very same

ground. He submits that the action of the 2nd respondent in

transferring / assigning the project FOBs. to the 5th respondent

is completely in violation of the procedural impropriety where

the decision-making authority has failed in its duty to act fairly.

It is submitted that by the impugned proceedings, the

Authorization Agreement is virtually being transferred to the 5th

respondent and the same amounts to novation, hence, the

petitioner has come before this Court.

3. Initially, on 21.12.2021, an interim order was

passed and the impugned proceedings were suspended. Later,

the interim order was extended form time to time.

4. Sri Pasham Krishna Reddy, learned Standing

Counsel for the respondent Corporation filed a detailed counter

affidavit. He submits that construction of FOBs. is completed

and FOBs. are under operation and the 2nd respondent has

instructed to hand over FOBs. to the Advertisement wing for

better monitoring and proper implementation of the

Authorization Agreement. It is stated that the role of

Engineering Department ends with the construction and

commissioning of FOBs. and thereafter, the advertisement wing

is better equipped to monitor the Authorization Agreement,

hence, they have agreed to transfer the Authorization Agreement

form Engineering Wing to Advertisement Wing. It is stated that

the Authorization Agreement is made and executed between the

parties ie. Greater Hyderabad Municipal Corporation and M/s

GMR Ads. and Advertisement Wing is also part of GHMC and

the transfer cannot termed as violation of the terms of the

contract. He further submits that as per the orders of the

Commissioner, GHMC dated 10.11.2021, all the records have

been handed over to the 5th respondent and the petitioner was

intimated about handing over of the records by proceedings

dated 17.11.2021 and in the process, the request of the

petitioner was denied and the petitioner was directed to make

correspondence with the 5th respondent. It is stated that when

the petitioner has misused the FOBs. for advertisement and also

gave vague explanations for the notices issued, the 5th

respondent, who is the Director of EV & DM, GHMC issued

challans for violating the Rules. Learned Standing Counsel

submits that for effective utilization of the officers and staff of

GHMC to bring the regulation of all the FOBs. with

advertisements under a single wing, the 2nd respondent has

instructed the 5th respondent to monitor the maintenance of the

FOBs. with powers conferred under the Greater Hyderabad

Municipal Corporation Act, 1955. It is submitted that by

transferring the administrative control to the Advertisement

Wing, none of the provisions of the Authorization Agreement is

violated or altered. He also relied on the judgment of the

Hon'ble Apex Court in Maharashtra Law Development

Corporation v. State of Maharashtra2 and submitted that the

Court will be concerned with the correctness of the decision

rather than the method to reach such decision. He submits that

the measures adopted by the respondents are proportionate to

the pursued objective and through the impugned decision there

is no effect on the rights, interests and liberties of the petitioner.

Further, relying on the judgment of the Apex Court in M/s Sethi

Auto Service Station v. Delhi Development Authority,

(2011) 15 SCC 616

learned Standing Counsel submits that by transfer of charge

from Respondents 3 and 4 to the 5th respondent neither the

rights and obligations under the Authorization Agreement are

altered nor the petitioner was deprived of any benefit or

advantage, hence, question of legitimate expectation does not

arise. Learned Standing Counsel submits that absolutely there

is no legal and tenable ground to interfere with the order

impugned.

5. The sum and substance of the arguments advanced

on behalf of the learned Senior Counsel is that as per the terms

of the contract, the 4th respondent is the Authority and now the

control has been shifted from the 4th respondent to the 5th

respondent, who is not competent and the said transfer

amounts to violation / altering the terms of contract. There is

no dispute about the proposition that conditions of the

agreement of a contract cannot be unilaterally changed as the

rules of the game cannot be changed after the game starts.

When extensive arguments are advanced by the learned Senior

Counsel, this Court has specifically asked a query - which part

of the agreement / provision / condition says that control of the

FOB is with the Project Wing and now by virtue of the impugned

proceedings it is transferred from Project Wing to the

Advertisement Wing that amounts to change or alteration of the

conditions of the Agreement. Learned Senior Counsel though

relied on several provisions in the agreement, could not point

out what is the violation / alteration of the terms of the

Agreement. It is an admitted fact that the Agreement is between

GHMC and the petitioner. There are several terms in the

Agreement and as per Clause 17 of the Agreement, conditions of

the Agreement cannot be changed and from the entire

Agreement, learned Senior Counsel could not point out that the

project wing of GHMC is specified in any of the conditions. The

Corporation for effective implementation of the said contract

had initially directed the project wing to take care of installation

of FOBs. and now as commissioning of FOBs. is over, for

effective implementation, they wanted this to be under the

administrative control of the Advertisement Wing which has

nothing to do with any of the conditions in the Agreement. It is

only for better administration and for convenience of GHMC.

The petitioner could not make out any ground much less

tenable ground to interfere with the impugned order.

6. The only grievance of the petitioner appears to be

that the Additional Commissioner, who is the 5th respondent

has issued certain challans against the petitioner and they

assumed that if the control is transferred to him, it would cause

some prejudice. That itself cannot be a ground to interfere with

the proceedings impugned in the Writ Petition. This Court do

not find any infirmity in the proceedings, dated 17.11.2021 and

it cannot be termed as alteration or change in the terms and

conditions of the contract. The Writ Petition is therefore, liable

to be dismissed.

7. The Writ Petition is accordingly, dismissed. There

shall be no order as to costs.

8. The miscellaneous Applications, if any shall stand

closed.

___________________________ LALITHA KANNEGANTI, J 20th April 2022

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