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Telangana High Court

Karangula Abhishek Reddy vs The State Of Telangana on 15 April, 2026

       IN THE HIGH COURT FOR THE STATE OF
           TELANGANA AT HYDERABAD
THE HONOURABLE SRI JUSTICE N.V.SHRAVAN KUMAR
              WRIT PETITION No.10453 of 2026
               DATE OF ORDER: 15.04.2026

Between:
Karangula Abhishek Reddy

                                                                 ...Petitioner
                                  AND

The State of Telangana,
Rep. by its Principal Secretary,
Municipal Administration & Urban             Development        Department,
Secretariat, Hyderabad & 3 others

                                                              ...Respondents
ORDER:

1. This writ petition is filed seeking following prayer:

"...to issue an appropriate writ, order or direction more particularly one in the nature of Writ of Mandamus, declaring Notice No.603/LF-Melkote/UF/HMDA/25-26 dated 24.03.2026 (served on the petitioner on

02.04.2026) issued by respondent No.4, whereby the petitioner was directed to vacate the Gymnasium and Swimming Pool at Dr.G.S.Melkote Park, Narayanaguda, Hyderabad within seven (7) days as being illegal, arbitrary, unconstitutional, violative of the principles of natural justice, and contrary to the respondents's own conduct in continuously accepting licence fees, and a consequential direction seeking to set-aside the said notice and permit the petitioner to continue the operation and maintenance of the said premises till a fresh tender is lawfully finalized and a successful bidder is appointed......"

2. The petitioner is aggrieved by the notice dated 24.03.2026 issued

by the 4th respondent served on the petitioner on 02.04.2026 directing

the petitioner to vacate the premises namely Gymnasium and

Swimming Pool at Dr. G.S.Melkote Park, Narayanaguda, Hyderabad,

within (07) days. The contents of the impugned notice dated

24.03.2026 refers to the license agreement dated 23.03.2017, wherein

it is stated that as per terms and conditions of the said agreement, the

license period expired on 31.01.2025 and that the petitioner was not

making payments as per the terms and conditions of the license as

such respondent No.2 reserves right to initiate action for recovery of

huge amounts due and payable by the petitioner. It is further stated

that despite expiry of License period, the petitioner had not vacated

and handed over the possession of the above mentioned premises to

HMDA and is continuing to occupy the same unauthorizedly as such

in view of the expiry of License Period, the petitioner was directed to

vacate the premises with all his belongings and handover the premises

to HMDA within (07) days.

3. The brief facts as stated in this writ petition are that the

petitioner is the sole proprietor of Praxix Fitness Hub, a proprietorship

concern engaged in providing swimming and gymnasium amenities,

situated at Dr. G.S.Melkote Park, Narayanaguda, Hyderabad

(hereinafter referred as "premises"). The respondent No.4 in 2016 has

issued a Tender Document inviting bids for the grant of licence rights

and execution of a licence agreement for installation and maintenance

of the Gymnasium and Swimming Pool at Dr.G.S.Melkote Park,

Hyderabad (hereinafter referred as "Subject Works"). The petitioner

was declared as successful bidder and a licence agreement dated

23.03.2017 was executed between respondent No.4 and petitioner.

4. Learned counsel for the petitioner has drawn attention of this

Court to the various clauses mentioned in the e-procurement platform

in the tender document. Clause 4.33 of the Tender Document deals

with License Period and License Fee and the same is extracted for

reference:

"4.33. License Period and License Fee a. License period shall be for a period of Five (05) years from the date of License agreement.

b. Upset Price fixed by the HMDA does not include any applicable Taxes. However, the Licensee shall pay the License Fee Plus its applicable taxes.

c. The Lincesee shall have a license fee free period for a maximum of two (02) months from the date of license agreement.

d. First year license fee shall be the price quoted by the bidder in its financial bid. There shall be an increment of 0.5% in the license fee every year over the previous year i.e., 2nd year license fee is 05% over and above the license fee of first year (Bidders quoted fee) and third year license fee is 05% over and above that of the 2nd year.

e. However, after the end of the license period i.e., five (05) years, if there is any request from the licensee for extension of license period. Then, HMDA may consider for a maximum of two (02) years only based on satisfactory performance (timely payments to HMDA, successful operations of project facilities without any complaints, etc.) Further, there shall be an increment of 05% in the license fee over the previous year i.e., 05th year. However, the final approval (for extending the license period) shall be at the sole discretion of the Metropolitan Commissioner, HMDA. The licensee has not right whatsoever the reason or manner.

f. In case of cancellation of withdrawal of license/permission by HMDA or on expiry of the license period, the Licensee shall with immediate effect, stop the activity granted under the license and leave the premises duly handing

over the premises to HMDA (duly clearly/paying the payments) in original condition on "as is where is basis", failing which it shall be deemed that the Licensee has vacated the premises and possession reverted to the licensor, and HMDA shall evict Licensee and treat the licensee as tress-passor or encroacher liable for criminal action under law.

5. Learned counsel for the petitioner submits that the petitioner is

continuously paying the license fees and has drawn attention of this

Court to the e-mail correspondence dated 13.02.2026 made to the

respondent authorities informing the remittance of Rs.9,53,627/-

towards license fee for the relevant period which was credited on

13.02.2026 and that the respondent authorities were accepting the

license fee from time to time. Learned counsel would further submit

that the respondent authorities were silently accepting the license fee

even more than one year after the alleged expiry date 31.01.2025.

However, the respondents authorities have now abruptly issued the

impugned notice directing the petitioner to vacate the premises.

Learned counsel for the petitioner while referring to the various

clauses of the tender conditions submits that since the respondent

authorities are accepting the license fee, the same would be considered

as deemed extension of license and that there are no dues to be paid

by the petitioner to the respondent No.2.

6. Mr. Imran Khan, learned Additional Advocate General submits

that the petitioner is due to the respondent No.2 and is not paying the

license amounts and moreover, the lease period has been expired, in

that scenario the impugned notice was rightly issued on 24.03.2026.

7. When the matter was taken up for hearing on 07.04.2026, after

arguing at length, learned counsel for the petitioner on the

instructions of the petitioner fairly submits that petitioner would

vacate the subject premises on or before 30.06.2026. The order dated

07.04.2026 is extracted here for reference:

"Learned counsel for the petitioner, on instructions of the petitioner who is present in the Court, would submit that the petitioner would vacate the subject property on or before 30.06.2026 and shall pay the admitted amount of Rs.9,53,736/- (Rupees Nine Lakhs Fifty Three Thousand Seven Hundred and Thirty Six only) for the license fee along with applicable tax and would further submit that the petitioner would file an affidavit to that extent."

8. Mr. Imran Khan, learned Additional Advocate General fairly

submitted that if the petitioner vacates the subject premises by

30.06.2026, they have no objection. However, the respondents would

reserve their rights in recovering the pending dues.

9. Today, again when the matter is taken up for hearing, learned

counsel for the petitioner would submit that pursuant to the

directions of this Court dated 07.04.2026, the petitioner had paid an

amount of Rs.9,53,625/- (Rupees Nine Lakhs Fifty Three Thousand

Six Hundred and Twenty Five only) towards license fees for the last

quarter of the year 2025-26, (for the period from 01.01.2026 to

31.03.2026) and to that effect a memo has been placed before this

Court.

10. On the otherhand, Sri Imran Khan, learned Additional Advocate

General appearing for the respondents would submit that as per the

order passed by this Court, dated 07.04.2026, the petitioner had to

pay the admitted amount towards license fee pending as on date and

file an affidavit stating that he would vacate the premises on or before

30.06.2026, and whereas, the petitioner had only paid part license fee

pursuant to the directions of this Court, and that there are pending

dues and without filing affidavit stating that the petitioner would

vacate the subject property on or before 30.06.2026, as directed by

this Court had violated the order and would further submit that no

submissions were made by the counsel for the petitioner to the extent

of not filing the affidavit and would further submit that the conduct of

the petitioner is not bonafidee for not adhering to the conditional order

passed by this Court on 07.04.2026 which is nothing but the

petitioner had willfully disobeyed the order passed by this Court as

such no reliefs can be granted to the petitioner.

11. Heard both sides.

12. On a perusal of the tender conditions, prima facie the petitioner

has no legal right since tenure of the license period has been

completed, and there exists no legal right vested in the petitioner.

However, this Court is not inclined to dwell on the tender conditions,

since the contract is between the petitioner and respondent authorities

and the both the parties are bound and should abide by the the terms

and conditions.

13. On a perusal of the material available on record and taking into

account the submissions putforth by the learned counsel on either

side earlier, it is clear that the petitioner who was very much present

in the Court and being very well aware of the order passed by this

Court on 07.04.2026, had partly complied with the order i.e., paying

an amount of Rs.9,53,625/- (Rupees Nine Lakhs Fifty Three

Thousand Six Hundred and Twenty Five only) towards license fees for

the last quarter of the year 2025-26, for the period from 01.01.2026 to

31.03.2026 but, till date has not filed Affidavit as agreed, recorded

and as directed in the order dated 07.04.2026 stating that the

petitioner agreed to vacate the premises on or before 30.06.2026.

That apart, the petitioner is not present today and the counsel did not

make any submissions to the extent of petitioner statement which was

recorded in the order dated 07.04.2026 and no submissions were

made to the extent of not filing the affidavit. The petitioner conduct is

not bonafide and had willfully disobeyed the order of this Court as

such no reliefs can be granted to petitioner.

14. The Hon'ble Supreme Court between AIR INDIA LIMITED V.

COCHIN INTERNATIONAL AIRPORT LIMITED & OTHERS 1 held

that the State can choose its own method to arrive at a decision. It

(2002) 2 SCC 617

can fix its own terms of invitation to tender and that is not open to

judicial scrutiny. The relevant paragraph is extracted for reference:

"7. The law relating to award of a contract by the State, its corporations and bodies acting as instrumentalities and agencies of the Government has been settled by the decision of this Court in Ramana Dayaram Shetty v. International Airport Authority of India, Fertilizer Corpn. Kamgar Union (Regd.) v. Union of India, CCE v. Dunlop India Ltd, Tata Cellular v. Union of India, Ramniklal N. Bhutta v. State of Maharashtra and Raunaq International Ltd. v. I.V.R. Construction Ltd. The award of a contract, whether it is by a private party or by a public body or the State, is essentially a commercial transaction. In arriving at a commercial decision considerations which are paramount are commercial considerations. The State can choose its own method to arrive at a decision. It can fix its own terms of invitation to tender and that is not open to judicial scrutiny. It can enter into negotiations before finally deciding to accept one of the offers made to it. Price need not always be the sole criterion for awarding a contract. It is free to grant any relaxation, for bona fide reasons, if the tender conditions permit such a relaxation. It may not accept the offer even though it happens to be the highest or the lowest. But the State, its corporations, instrumentalities and agencies are bound to adhere to the norms, standards and procedures laid down by them and cannot depart from them arbitrarily. Though that decision is not amenable to judicial review, the court can examine the decision-making process and interfere if it is found vitiated by mala fides, unreasonableness and arbitrariness. The State, its corporations, instrumentalities and agencies have the public duty to be fair to all concerned. Even when some defect is found in the decision-making process the court must exercise its discretionary power under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the court should intervene."

15. In the case on hand, the petitioner and respondent No.4 has

entered an agreement and the parties are bound by the clauses

mentioned in the tender document and this Court under writ

jurisdiction cannot enter into the disputes between the parties. Prima-

facie the respondents did not dispute the contract awarded to the

petitioner as such no malafidees and bias cannot be attributed to the

respondent No.2.

16. The petitioner cannot continue to stay on the subject premises

and preempt the state in calling for tenders in future.

17. The Hon'ble Supreme Court between TATA MOTORS LIMITED

V. BRIHAN MUMBAI ELECTRIC SUPPLY AND TRANSPORT

UNDERTAKING (BEST) AND OTHERS 2 has held as under:

"50. This Court being the guardian of fundamental rights is duty-bound to interfere when there is arbitrariness, irrationality, mala fides and bias. However, this Court has cautioned time and again that courts should exercise a lot of restraint while exercising their powers of judicial review in contractual or commercial matters. This Court is normally loathe to interfere in contractual matters unless a clear-cut case of arbitrariness or mala fides or bias or irrationality is made out. One must remember that today many public sector undertakings compete with the private industry. The contracts entered into between private parties are not subject to scrutiny under writ jurisdiction. No doubt, the bodies which are State within the meaning of Article 12 of the Constitution are bound to act fairly and are amenable to the writ jurisdiction of superior courts but this discretionary power must be exercised with a great deal of restraint and caution. The courts must realise their limitations and the havoc which needless interference in commercial matters can cause. In contracts involving technical issues the courts should be even more reluctant because most of us in judges' robes do not have the necessary expertise to adjudicate upon technical issues beyond our domain. The courts should not use a magnifying glass while scanning the tenders and make every small mistake appear like a big

(2023) 19 SCC 1

blunder. In fact, the courts must give "fair play in the joints" to the government and public sector undertakings in matters of contract.

Courts must also not interfere where such interference will cause unnecessary loss to the public exchequer. (See Silppi Constructions Contractors v. Union of India.)"

18. In that view of the matter and in the light of the various judicial

precedents and since the petitioner has willfully disobeyed the orders

of this Court as such cannot seek any mandamus at this point of time

and the writ petition is devoid of merits, fails and is dismissed and

respondent authorities may take appropriate action strictly in

accordance with law.

19. Accordingly, this writ petition is dismissed. No order as to

costs.

Miscellaneous applications, if any pending, shall stand closed.

_________________________________ JUSTICE N.V.SHRAVAN KUMAR Date:15.04.2026 Note: