And CIVIL MISC. WRIT PETITION NO. 71896 of 2009 M/s Bapu Industries .......... Petitioners Vs.
Union of India & others .......... Respondents And CIVIL MISC. WRIT PETITION NO. 71905 of 2009 M/s Akash Wani Glass Works .......... Petitioner Vs.
Union of India and others .......... Respondents And CIVIL MISC. WRIT PETITION NO. 71912 of 2009 M/s Advance Lamp Component & ........... Petitioners Table Wares Pvt. Limited Vs.
Union of India and others ........... Respondents Present:
(Hon'ble Mr. Justice Amitava Lala and Hon'ble Mr. Justice S.N.H.Zaidi) Appearance For the petitioners : Sri Manish Goyal For the respondents : Sri Tarun Verma Amitava Lala, J. The aforesaid writ petitions have been filed praying interallia as follows:
"(a) issue a writ, order or direction in the nature of certiorari calling for the records and quashing the policy condition of refusal to contract with the cases of alleged tempering of metering skids and due consideration of the same only upon liquidation of 100% of the dues.
(b) issue a writ, order or direction in the nature of mandamus commanding the respondent no.2 to issue side letter to the petitioner as is being issued to other similarly situated industrial units at Firozabad.
(c) issue a writ, order or direction in the nature of mandamus commanding the respondents to sign Gas Supply Contract with the petitioner of R-LNG gas on firm basis.
(d) issue a writ, order or direction in the nature of prohibition restraining the respondents from supplying R-LNG gas on fallback basis to any other consumer to 2 the extent of the eligibility of the petitioner.
(e) issue any other writ, order or direction as this Hon'ble Court may deem fit and proper in the facts and circumstances of the case.
(f) Allow this petition with costs."
Mr. Manish Goyal, learned Counsel appearing for the petitioners has contended before this Court that the respective petitioners have entered into a contract with GAIL (India) Limited (hereinafter called as the GAIL) for the purpose of supplying Administered Price Mechanism (APM) gas and they are applicant to get supply of R-LNG to the extent of 25% of their existing contracted quantity on the basis of the policy decision made by the Company itself but in executing such contract two conditions have been imposed by the GAIL as follows: "(i) Tampering cases to be considered only after liquidation of 100% dues and
(ii) In cases where the issue regarding revision in quantity is pending in courts/arbitration, such requests may not be considered till the cases are sub- judice."
Mr. Goyal has contended before us that these two conditions which are imposed herein are unreasonable, irrational and opposed to public policy so far as judicial review is concerned and so far as contractual obligation is concerned they are amenable to the writ jurisdiction of this Court and accordingly, they invoked such jurisdiction to get appropriate order.
Factually, tampering cases are there against the petitioners for which an arbitration proceeding is pending. Apart from that, they have made deposit as against the claim and further part by way of security. Hence, the interest of the GAIL is totally protected. Against this background if the aforesaid conditions are imposed to liquidate 100% of the dues, the petitioners' right to get appropriate order in the arbitration proceeding will be rendered infructuous. This type of policy is against Section 28 of the Indian Contract Act. Moreover, policy decision is to be taken by the respective governments and the GAIL has no authority to impose such condition as a policy. Conditionally he further submitted that out of two conditions the second condition about revision in quantity relates to the proceeding before the courts or arbitration but in respect of tampering cases there is no such provision for arbitration. He said that the GAIL having monopoly business is in effect interfering with the business of the persons of the locality of the Firozabad where the only source of power is supply of gas.
In support of his contentions learned Counsel for the petitioners first of all relied upon a judgment reported in AIR 1988 SC 1247 ( Assistant Commissioner 3 of Commercial Taxes (Asst.) Vs. Dharmendra Trading Co.) to establish that if the Government wants to resile from a promise or an assurance given by it on the ground that undue advantage was being taken or misuse was being made of the concessions granted, the court may permit the Government to do so but before allowing the Government to resile from the promise or go back from the assurance, the Court would have to be satisfied that allegations by the government about misuse being made or undue advantage being taken of the concessions given by it were reasonably well established. He further relied upon a judgment reported in JT 1995 (4) S.C. 366 (L.I.C. Of India & Anr. Vs. Consumer Education & Research Centre & Ors.) mainly on the principle about the interference of the writ Court in such type of disputes. According to the petitioners, is the respondents entitled to impose unconstitutional conditions including that which denied the right of entering into contract,limiting only to a class of persons under a particular policy ? The judment also followed the well celebrated judgment in this branch reported in AIR 1990 SC 1031 (Mahabir Auto Stores Vs. Indian Oil Corporation) where it has held that rule of reason and rule against arbitrariness and discrimination, rules of fair play, natural justice are part of the rule of law applicable in situation or action by the State/instrumentality in dealing with citizens. Even though the rights of the citizens, therefore, are in the nature of contractual rights, the manner, the method and motive of a decision of entering or not entering into a contract, are subject to judicial review on the touchstone of relevance and reasonableness, fair play and natural justice, equality and non-discrimination. Though the same has been followed by several judgments in the Supreme Court and referred in such judgment but another aspect has been considered therein that the dichotomy between public law and private law rights and remedies, though may not be obliterated by any straight jacket formula, it would depend upon the factual matrix.
We considered the further ratio that nowadays there is a thinner line in between the public law element and private law rights to take a decision and we are of the same view to come to a conclusion on the factual matrix of the same. So far as the judgment cited by Mr. Goyal reported in JT 2007 (1) SC 125 (M/s Ashoka Smokeless Coal Ind. P.Ltd. & Ors. Vs. Union of India & Ors.) is concerned it is in respect of the judicial review and legitimate expectation.
We and Mr. Tarun Verma, learned Counsel appearing for the respondents, have no quarrel with the proposition of law. Mr. Verma has admitted by saying that he is only confining to factual matrix to come to a conclusion but before that he said that the GAIL is not doing any monopoly business which has to be clarified before this Court. On the contrary, other companies being Bharat Pumps & 4 Compressors Ltd. (BPCL), Indian Oil Corporation Ltd. (IOCL) and Oil and Natural Gas Commission (ONGC) are also doing the same business. Hence, the argument that the respondent GAIL is doing the monopoly business goes. Now let us come back to the factual aspect of the matter.
Admittedly the arbitration proceeding is going on between the parties in respect of tampering cases arising out of existing contract to supply the APM gas. The respondents have not debarred the petitioners from carrying out such business in spite of the existence of tampering cases for which the arbitration proceeding is continuing. The question is whether the respondents will enter into the contract with the petitioners in respect of R-LNG gas supply or not. Now to that extent certain yardstick has been made by the authorities. Not only in respect of the limited availability of such gas but also for the purpose of giving priority to the persons who are doing good business by deferring the tainted candidate, if any, for the time being till the liquidation of 100% amount or specially till the disposal of the arbitration proceeding to that extent. Therefore, there is no case of denial as such. These yardsticks can be made to execute the same by executing authority and we do not find that the same is unreasonable to place the petitioners equally with the candidates against whom there is no tampering case at all at present. Therefore, we can not hold and say such type of classification is discriminatory or unreasonable in nature. Had it been the case that the person has been allowed to enter into the contract even with the existence of the tampering case it would have been a different scenario altogether but there is no such case available before us. Against this background we can not hold and say that the public law element has been available in such manner that the redressal of grievance by the writ Court will proceed on and on in the matter keeping the tampering case pending before the arbitrator and allow the petitioners to enter into the contract with the respondents. The respondents have right of choice in respect of selection of the candidates making some yardstick otherwise they being executive will be answerable to the Government and as such right decision has been taken by the GAIL in putting such conditions.
However, we do not find that there is no denial of the case of the petitioners but only in the case of deferring the clause till the disposal of the arbitration proceeding though there is no provision for arbitration proceeding under the clause
(i) in the letter concerned but we hold and say that subject to completion of the arbitration and satisfaction of the GAIL to the extent of such condition, the petitioners can be entitled to get such type of supply on the basis of the contract to that extent only. Therefore, the requirement of the Court is to dispose of the writ 5 petition even at the stage of admission by directing the arbitral forum to complete the course of action positively within a period of three months from the date of communication of this order to the Arbitrator. After completion of the arbitration the petitioners can approach. Except above direction no order can be passed by this Court in disposing the writ petition and, accordingly, the writ petition is disposed of.
No order is passed as to costs.
(Justice Amitava Lala) I agree.
(Justice S.N.H.Zaidi) Dt/.07.01.2010 MAA/-
Hon'ble Amitava Lala,J.
Hon'ble S.N.H.Zaidi,J.
In view of the order passed on Civil Misc. Writ Petition No. 71885 2009 the writ petition stands disposed of without imposing any cost.
Dt.07.01.2010 MAA/-
For orders, see order of date passed on Civil Misc. Writ Petition No. 71885 2009.
Dt. 07.01.2010 MAA/-
Hon'ble Amitava Lala,J.
Hon'ble S.N.H.Zaidi,J.
In view of the order passed on Civil Misc. Writ Petition No. 71885 2009 the writ petition stands disposed of without imposing any cost.
Dt.07.01.2010 MAA/-
For orders, see order of date passed on Civil Misc. Writ Petition No. 71885 2009.
Dt. 07.01.2010 MAA/-
Hon'ble Amitava Lala,J.
Hon'ble S.N.H.Zaidi,J.
In view of the order passed on Civil Misc. Writ Petition No. 71885 2009 the writ petition stands disposed of without imposing any cost.
Dt.07.01.2010 MAA/-
For orders, see order of date passed on Civil Misc. Writ Petition No. 71885 2009.
Dt. 07.01.2010 MAA/-