Nagar Nigam,
Meerut Vs. Al Faheem Meat Exports Pvt. Ltd & Ors [2006] Insc 919 (7 December 2006)
S.
B. Sinha & Markandey Katju
(Arising
out of SLP(Civil) No. 10174 of 2006) S.B. SINHA, J.
Leave
granted.
Nagar Nigam
Meerut is before us questioning the legality of a judgment and order dated 29th March, 2006 passed by a Division Bench of the Allahabad
High Court in Civil Misc. Writ Petition No. 53782 of 2004.
Appellant-Corporation
is a local authority constituted under Uttar Pradesh Municipal Corporations Adhiniyam,
1959 (the Act). As a local authority, indisputably it has a large number of
public duties and functions to perform;
maintenance
of slaughter house being one of them. Chapter XVI of the Act inter alia
provides for regulation of slaughter houses. Sections 422 and 423 of the said
Act, which are relevant for the purpose of this case are set out herein below:
"422.
Municipal Commissioner's powers in respect of Corporation markets and
slaughterhouse etc. - Subject to the provision of this Act and the rule and
bye-laws framed thereunder the Municipal Commissioner shall have the power
(a)
upon being authorized by the Corporation in that behalf, to construct,
purchase, take on lease or otherwise acquire any building or land for the
purpose of establishing a Corporation market or a Corporation slaughter-house
or stockyard within, and with the prior sanction of the State Government,
without the limits of the Corporation and of extending or improving any
existing Corporation market or slaughter-house;
(b)
from time to time, to build and maintain such Corporation markets,
slaughter-house and stockyards and such stalls, shops, sheds, pens and other
buildings or conveniences as may be deemed necessary for the use of the persons
carrying on trade or business in, or frequenting, such Corporation markets,
slaughter-houses or stockyards;
(c) to
provide for maintaining on any such Corporation markets such building, places,
machines, weights, scales and measures for weighing and measuring goods, sold
therein as he shall think fit;
(d)
upon being authorized by the Corporation on that behalf, to close any
Corporation market or slaughter-house or stockyard or any portion thereof and
to dispose of as the property of the Corporation the premises occupied for any
market or slaughter-house or stockyard or any portion thereof so closes;
(e)
with the previous sanction of the Corporation, to prohibit by public notice
from time to time within a distance of fifty yards of any Corporation market
the sale or exposure for sale of the commodities or of any of the commodities
specified in the notice ordinarily sold in the said Corporation market and with
like sanction to cancel or modify any such notice at any time;
(f) to
charge for the occupation or use of any stall, shop, standing shed, or pen or
other building in a Corporation market, slaughter-house or stockyard, and for
the right to expose goods for sale in a Corporation market, and for weighing
and measuring goods sold in any such market and for the right to slaughter
animals in any Corporation slaughter-house, such stallages, rents and fees as
shall, from time to time be fixed by him, with the approval of the Executive
Committee, in that behalf;
(g)
with the approval of the Committee, from the stallages, rents and fees leviable
as aforesaid or any portion thereof, for any period not exceeding one year at a
time; or (h) to put up to public auction, or with the approval of the Executive
Committee, dispose of, by private sale, for privilege of occupying or using any
stall, shop, standing shed or pen or other building in a Corporation market,
slaughter-house or stockyard for such term and on such conditions as he shall
think fit.
423.
Opening of private markets and of private slaughter-houses:-
(1)
The Corporation shall from time to time determine whether the establishment of
new private markets or the establishment or maintenance of private
slaughter-house shall be permitted in the City or in any specified portion of
the City.
(2) No
person shall establish a private market for sale of, or for the purpose of
exposing for sale, animals intended for human food, or any article of human
food or livestock or articles of good for livestock or shall establish or
maintain a private slaughter-house except with the sanction of and after obtaining
a licence from the Municipal Commissioner who shall be guided in giving such
sanction and licence by the decisions of the Corporation at the time in force
under Sub-section (1):
Provided
that the Municipal Commissioner shall not refuse to give sanction lawfully
established on the appointed day if application for such sanction and licence
is made within two months of the appointed day, except on the ground that the
place where the market or slaughter-house is established falls to comply with
any requirements of this Act or of any rule of bye-law thereunder.
(3)
When the establishment of a private market or a slaughter-house has been so
sanctioned the Municipal Commissioner shall cause a notice of such sanction to
be affixed in Hindi and such other language or languages as the Corporation may
from time to time specify on some conspicuous spot on or near the building or
place where such market is to be held.
Explanation: For the purpose of Sub-section (2)
the owner or occupier of a place in which a private market or slaughter-house
is established shall be deemed to have established such market.
(4)
The Municipal Commissioner shall not cancel or suspend or refused to renew any licence
for keeping open a private market for any cause other than the failure of the
owner thereof to comply with some provision of this Act, or with some
regulation or with some bye-law.
(5)
The Municipal Commissioner may cancel or suspend any licence for failure of the
owner of a private market to give in accordance with the conditions of his licence
a written receipt for any stallage, rent, fee or other payment received by him
or his agent from any person for the occupation or use of any stall, shop,
standing, shed, pen or other place therein.
(6)
When the Municipal Commissioner has refused, cancelled or suspended any licence
to keep open a private market, he shall cause a notice of his having so done to
be affixed in such language or languages as the Corporation may from time to
time specify on some conspicuous spot on or near the building or place where
such market has been held." The first respondent herein was granted a licence
for a period of one year to run a slaughter house which is owned by the
appellant-Corporation.
It
gives this slaughter house on annual licence basis. Such a licence was granted
to the first respondent herein on 9.1.2004. The said licence expired on
8.1.2005. The impugned advertisement dated 6.12.2004 was issued by the
appellant inviting applications for granting a fresh contract for running the
slaughter house. It is this advertisement whose validity was challenged before
the High Court.
It may
be mentioned here that in the year 2003, the Mayor of the Nagar Nigam issued an
advertisement on 9.11.2003 for modernizing the existing slaughter house, which
was published in some local newspapers.
The
first respondent is said to have submitted a project report in response to the
same. However, as stated in paragraph 8 of the counter affidavit of the Nagar Nigam
before the High Court, the power to accept such a project report is with the
general body of the Nagar Nigam, which has not granted any approval thereto.
It is
alleged by the first respondent that he sent a representation to the State
Government seeking its permission to modernize the slaughter house.
Thereafter
he filed a writ petition being Writ No. 37187/2004 before the High Court, which
disposed off the same on 15.9.2004 by directing the State Government to
consider the said representation. It is alleged that instead of deciding the
representation, the Nagar Nigam issued the impugned advertisement inviting
applications for tenders for running of the slaughter house in question.
We may
at this juncture also notice that the State intended to acquire some land for a
site for construction of an alternative slaughter house, in respect of which
proceeding under the Land Acquisition Act was initiated.
However,
at the instance of one of the owners of the said land, the High Court in Civil
Misc. Writ Petition No. 11069 of 2006 (Asaf Ali vs. State of U.P. & Ors.)
stayed dispossession of the petitioner therein. That writ petition is said to
be still pending.
The
High Court by means of the impugned judgment dated 29.3.2006 has allowed the
writ petition directing that the writ petitioner (respondent No. 1 herein)
should be allowed to run the slaughter house for 10 years on terms and
conditions stipulated therein. We would reproduce the relevant part of the
impugned judgment of the High Court which is as under:
"Petitioner
No. 1 and his counsel (Sh. S.D. Kautilya, advocate) have
categorically stated before us that the petitioner No. 1 shall construct new
building and install latest modern plants, machines fixtures with latest
advanced technology on international standards so that one shall not be able to
identify it as "Slaughter House" from outside and offered to invest Rs.
6 crores to complete the project in one year besides undertaking to deposit Rs.
60 lacs per annum at par with the offer of petitioner No. 2 (As per affidavit
of Sri Prithvi SinghChauhan) provided he is allowed to carry on the Slaughter
House for ten years.
Keeping
in mind that the interest of the common man at large is paramount which should
not be ignored and to ensure the welfare of the local residents by saving them
from facing untold hardships and sufferings (as already recapitulated earlier),
we direct the Nigam and other concerned authorities of Meerut, Administration
to assist and cooperate with petitioner No. 1 to modernize the Slaughter House
at its existing site on following "terms and conditions":-
(1)
Petitioner No. 1 represented by its Director Mohd. Imran Khan (which includes
legal representative, successor, assignee, agent, nominee, servant etc.) shall,
on or before 30.4.2006, file an affidavit giving undertaking to the Nigam to
comply with the directions given hereunder.
(2) (a)
Petitioner No. 1 as per its offer and undertaking given to the court shall on
or before 15th May 2006 deposit Rs. three crores with Nagar
Nigam, Meerut.
(b)
Petitioner No. 1 shall also deposit Rs. two crores on or before 30th September 2006 with Nagar Nigam, Meerut.
(c)
The Nigam give written notice to the Petitioner No. 1 to deposit within three
weeks of receipt of said Notice or such extended time as the Nigam may grant in
writing such additional amount (not exceeding Rs. 50 lacks at one instance) in
case additional amount, exceeding Rs. five crores referred in above clause (a)
and (b), is required to complete the project, (as contemplated under this
judgment) subject, however, to the condition:
(i) demand
of additional amount shall not in total exceed Rs. one crore and the petitioner
No. 1, therefore, shall not be required to deposit in total more than rupees
six crores; and
(ii)
Further, in case of any amount being found in excess and unutilized at the end
of completion of Project the said amount with interest if any shall be repaid
to Petitioner No. 1 forthwith. crores
(d)
The above amount and time schedule shall be subject to such further mutual
agreement/Settlement as the Nigam and Petitioner No. 1 may settle under prior
information to each other as well as to the State Government but
notwithstanding the quality and the conditions of Project of Slaughter House
duly approved/sanctioned by Centre for Integrated Animal Husbandry & Dairy
Development, Noida (CIAHDD).
(e)
All the aforesaid amounts deposited by petitioner No.1 shall be kept by the Nigam
in a separate Nationalized Bank Account which shall be exclusively
appropriated/utilized for executing modern slaughter house Project as duly
approved (as contemplated herein under) at the site of existing Slaughter
House.
(3)
Petitioner No. 1 shall get the project-report of the modern Slaughter House
(with all details) duly approved and cleared on or before 15th May 2006 by
Centre for Integrated Animal Husbandry and Dairy Development, Noida CIAHDD and
Agency/Organiszation approved by the Nigam.
The
project reports shall include plan for Civil electrical and mechanical
designs/plans, adequate provisions to check pollution of any kind including
"Treatment of Effluents and Pollutants" as per norms prescribed by
U.P. Pollution Control Board. Health and Safety Devices, prevention of Five and
other relevant details as may be required by the Nigam, or the State Government
under relevant concerned Act, Rules, Regulation, Government Orders etc. as well
as bind itself to discharge all obligation otherwise created for operating
modern slaughter house on international standards.
(4)
Petitioner No. 1 shall submit on or before 30th May 2006 a copy of the Project
Report/Plan duly approved by CIAHDD and other information, if any, to the Nigam,
M.D.A. or Pollution Control Board, etc. dealing with the subject in question
for information who shall pass appropriate order within ten days of receipt
plan and intimate Petitioner No. 1 accordingly.
(5)
Petitioner No.1 shall be duty bound to remove defect, if any, communicated to
it by the Nigam, M.D.A. or U.P. Pollution Control Board, within two weeks of
receipt of objection and obtain No Objection forthwith but in any case before 15th June, 2006. The Board shall consider the
report and pass appropriate order/grant or refuse "No Objection"
within ten days of receipt of submission of papers after removal of such
defect.
(6)
Petitioner No. 1 shall also obtain sanction No Objection from the Nigam, Meerut
Development Authority(MDA), and U.P. Control Pollution Board by submitting
amendments in the plans, if any, at appropriate time and then authorities shall
within ten days of the receipt of the same pass appropriate order.
(7)
Petitioner No. 1 shall inform Nigam in writing before starting
construction/execution of Project work which must be undertaken on or before 15th July, 2006.
(8)
Petitioner No. 1 shall cooperate and assist the Nigam (its
authorities/officers) to make inspection of the site during course of
implementation of the project to satisfy that the work is as per Project Report
approved by CIAHDD as well as other directions issued by other authorities viz.
the Nigam, Meerrut Development Authority, U.P. Pollution Control Board etc.
(9)
Petitioner No. 1 shall be entitled to supervise execution of the Project work
and shall be entitled to ensure that said work is performed/executed as per
Project Report, and all payments in that respect shall be made promptly by the Nigam
in accordance with law from the amount so deposited by Petitioner No. 1 under
the above sub clauses of Clause 2.
(10)
Petitioner No. 1 shall be permitted to operate and slaughter animals at the
existing slaughter- house subject to the condition that he shall deposit with
the Nigam on or before 15.05.2006 rupees sixty lacs in lump sum for the period
of 01-04- 2006 to 31-03-2007. Such amount can be deposited, if so advised, in
four equal instalments; the first installment of Rs. 15 lacs to be paid to the Nigam
on or before 15th May,
2006. The second
installment to be paid to be paid to the Nigam on or before 15-08-2006, third
installment to be paid to the Nigam on or before 15-11-2006 and fourth
installment to be paid to the Nigam on or before 15-02-2007. In case of default
in making the said deposits within the time stipulated above, this order shall
stand automatically vacated in its entirety. Petitioner No. 1 shall likewise
continue to deposit amount of Rs. 60 lacs per annum for ten years i.e. for the
period ending on 31-03-2016.
And
thereafter slaughter house shall be allowed to be used and operated on such
basis and terms and conditions as may be allowed and settled by the Nigam under
the law.
(11)
Petitioner No. 1 shall be free to abandon his claim to run modern slaughter
house for a period of "ten years" or for less period as he may be
desired but he shall not be, in lieu of it or in connection with, entitled to
damages/compensation of any kind.
(12)
Slaughter House shall be modernized within a maximum period of one year from
today out of the funds referred to in Clause 1(a), (b), (c), (d) and (e) above.
(13) Nagar
Nigam Meerut, District Authorities and other concerned authorities shall be
duty bound to ensure that all steps are taken to promote expeditious execution
of the Project Report referred to above and further hereby directed to extend
desired support and full cooperation to the petitioner in establishing
"modern Slaughter House". Laxity or negligence in any manner on the
part of either party shall be deemed and treated deliberate act of interfering
with the compliance of this order of the Court.
(14)
Petitioner No. 1 shall have no claim or interest or subsisting right or charge
on the assets, whether movable or immovable in the assets of the slaughter
house in question created out of funds referred to in sub-clause 2(a), (b), (c)
(d), (e) and (f) of Clause 2 after expiry of ten years or in case of the
petitioner No. 1 abandoning or relinquishing his right to operate the Slaughter
House at any time before expiry of said ten years.
(15)
The Nagar Nigam, Meerut and all the concerned authorities shall have right to
make periodical inspections to ensure that the slaughterhouse is properly
maintained and run in accordance with the relevant statutory provisions, viz.,
the Act, Rules/Regulations and Government Orders, etc, if any for ten years
period contemplated above.
(16)
*** *** *** (17) This order shall not, in any manner be read or interpreted to
encroach upon or undermine the power conferred in lieu upon any
Officer/Authority of the Corporation etc.
(18)
In case of difficulty or doubt the parties are at liberty to approach this
Court for appropriate/requisite order by way of clarification.
U.P.
Government., Nagar Vikas Anubhag Order dated 07-01-2005 (No. 03 Writ/9-8-2005-
11P/03), Annexure CA-3 to short counter affidavit of respondent No. 1/State of
U.P., is hereby set aside.
The
Writ petition is allowed by moulding the reliefs subject to the conditions and
to the extent indicated above" The directions issued by the High Court, in
our considered opinion, were totally unwarranted. The High Court undoubtedly
exercises a wide jurisdiction under Article 226 of the Constitution of India.
The jurisdiction of the High Court to entertain an application in the nature of
a public interest litigation is well-known but it is also trite that the court
should exercise its jurisdiction only when it is essential to do so. It is also
trite that ordinarily the High Court would not interfere in an administrative
action of the State unless it is inter alia found to be contrary to a
legislative policy or arbitrary attracting the wrath of Article 14 of the
Constitution of India. The jurisdiction of the High Court is limited in this
regard. [See State of U.P. vs. Section Officer Brotherhood and
Anr. 2004 (8) SCC 286] Apart from the above, Mr. Jayant Bhushan, learned senior
counsel appearing on behalf of the appellant submitted before us that the High
Court could not have issued the impugned directions which are not only violative
of Sections 422 and 423 of the Act, for the reasons that the statutory
functions of the Corporation have been taken away by the High Court's order,
but in addition the constitutional scheme adumbrated under Article 14 of the
Constitution also stands violated. The learned senior counsel contended that if
with a view to achieve transparency the Corporation intended to advertise a
tender, it was not for the High Court to direct grant of contract in favour of
the first respondent herein on the terms and conditions laid down in the
impugned judgment.
Mr. Dinesh
Dwivedi, learned senior counsel appearing for respondent No.1, on the other
hand, submitted that the High Court was faced with an exceptional situation
namely, the pressing need for modernization and proper maintenance of the
slaughter house keeping in view the health hazards of the public at large. It
was pointed out that the new proposed slaughter house cannot be constructed at
an early date, as the High Court in another writ petition has stayed acquisition
of the alternative site, as a result whereof a stalemate had occurred and
continued for 2-1/2 years. The appellant-Corporation, it was urged, in view of
the stand taken by the State of U.P. could not grant lease for more than one
year and it had no funds to construct a new modernized slaughter house. It was
submitted that having regard to the aforementioned difficulties, the High Court
passed the impugned judgment and, thus, no fault can be found therewith. The
learned senior counsel would contend that Article 14 does not prohibit
negotiation with a private person for the purpose of distribution of largesse
by the State in some exceptional circumstances. Reliance in this connection has
been placed on the judgments of this Court reported in Sachidanand Pandey &
Ors. vs. State of West
Bengal & Ors
(1987) 2 SCC 295, Brij Bhushan & Ors. vs. State of J & K & Ors. (1986) 2 SCC 354 and M.P. Oil
Extraction vs. State of M.P. (1997) 7 SCC 592.
Indisputably
Appellant-Corporation is a State within the meaning of Article 12 of the
Constitution of India. It was constituted under the said Act which was enacted
with a view to ensure better municipal governmence of the cities in the State
of Uttar Pradesh. The statutory obligation on the
part of the Municipal Corporation to build and/or maintain a hygienic slaughter
house is not open to question. We have noticed hereinbefore that in terms of
Sections 422 and 423 of the Act, the Corporation has various options. Such
options, however, must be exercised by the Nagar Nigam itself having regard to
the statutory scheme with a view to maintain public hygiene, but the same must
be done in the light of the doctrine of life and liberty of a citizen as
adumbrated under Article 21 of the Constitution. Such options cannot be exercised
by the High Court, as that is no part of its functions.
Maintenance
and setting up of a slaughter house (abattoir) is a statutory responsibility of
the Corporation. We may notice that the three Judge bench of this Court in
Buffalo Traders Welfare Association vs. Union of India & Ors. (2004) 11 SCC
333 had issued certain directions to the Municipal Corporation of Delhi to construct both temporary and
permanent slaughter house (abattoir) keeping in mind the future need of the
city. This Court in the said case has been monitoring construction of a modern
slaughter house in Delhi. However, the question who should
be given the contract for the slaughter house and on what terms, is for the
Municipal Corporation to decide, and not for the Courts. All that the Courts
can do is to ensure that there is no arbitrariness on the part of the Municipal
authorities.
In
this case, however, we are concerned with a different question. It is now a
well settled principle of law that having regard to the provisions of Article
14 of the Constitution of India, a State within the meaning of Article 12
thereof cannot distribute its largesse at its own sweet will, vide R.S. Shetty
vs. Union of India, AIR1979 SC 1628. The Court can ensure that the statutory
functions are not carried out at the whims and caprices of the officers of the
government/local body in an arbitrary manner. But the Court cannot itself take
over these functions.
This
Court time and again has emphasized the need to maintain transparency in grant
of public contracts. Ordinarily, maintenance of transparency as also compliance
of Article 14 of the Constitution would inter alia be ensured by holding public
auction upon issuance of advertisement in the well known newspapers. That has
not been done in this case. Although the Nagar Nigam had advertised the
contract, the High Court has directed that it should be given for 10 years to a
particular party (respondent No. 1).
This
was clearly illegal.
It is
well settled that ordinarily the State or its instrumentalities should not give
contracts by private negotiation but by open public auction/tender after wide
publicity. In this case the contract has not only been given by way of private
negotiation, but the negotiation has been carried out by the High Court itself,
which is impermissible.
We
have no doubt that in rare and exceptional cases, having regard to the nature
of the trade or largesse or for some other good reason, a contract may have to
be granted by private negotiation, but normally that should not be done as it
shakes the public confidence.
The
law is well-settled that contracts by the State, its corporations,
instrumentalities and agencies must be normally granted through public
auction/public tender by inviting tenders from eligible persons and the notification
of the public-auction or inviting tenders should be advertised in well known
dailies having wide circulation in the locality with all relevant details such
as date, time and place of auction, subject-matter of auction, technical
specifications, estimated cost, earnest money Deposit, etc. The award of
Government contracts through public-auction/public tender is to ensure
transparency in the public procurement, to maximise economy and efficiency in
Government procurement, to promote healthy competition among the tenderers, to
provide for fair and equitable treatment of all tenderers, and to eliminate
irregularities, interference and corrupt practices by the authorities
concerned. This is required by Article 14 of the Constitution. However, in rare
and exceptional cases, for instance during natural calamities and emergencies
declared by the Government; where the procurement is possible from a single
source only; where the supplier or contractor has exclusive rights in respect
of the goods or services and no reasonable alternative or substitute exists;
where the auction was held on several dates but there were no bidders or the
bids offered were too low, etc., this normal rule may be departed from and such
contracts may be awarded through 'private negotiations'. (See Ram and Shyam
Company vs. State of Haryana and Others, AIR 1985 SC 1147).
In Sachidanand
Pandey v. State of West
Bengal, AIR 1987 SC
1109 at 1133, O.Chinnappa Reddy, J. after considering almost all the decisions
of the Court on the subject summarized the legal propositions in the following
terms:
"On
a consideration of the relevant cases cited at the bar the following
propositions may be taken as well established: State owned or public owned
property is not to be dealt with at the absolute discretion of the executive.
Certain precepts and principles have to be observed.
Public
interest is the paramount consideration.
One of
the methods of securing the public interest when it is considered necessary to
dispose of a property is to sell the property by public auction or by inviting
tenders. Though that is the ordinary rule, it is not an invariable rule. There
may be situations where there are compelling reasons necessitating departure
from the rule but then the reasons for the departure must be rational and
should not be suggestive of discrimination. Appearance of public justice is as
important as doing justice.
Nothing
should be done which gives an appearance of bias, jobbery or nepotism."
"The public property owned by the State or by an instrumentality of the
State should be generally sold by public auction or by inviting tenders. This
Court has been insisting upon that rule, not only to get the highest price for
the property but also to ensure fairness in the activities of the State and
public authorities.
They
should undoubtedly act fairly. Their actions should be legitimate. Their
dealings should be above board. Their transactions should be without aversion
or affection.
Nothing
should be suggestive of discrimination. Nothing should be done by them which gives
an impression of bias, favoritism or nepotism. Ordinarily, these factors would
be absent if the matter is brought to public auction or sale by tenders. That
is why the Court repeatedly stated and reiterated that the State owned
properties are required to be disposed of publicly. But that is not the only
rule. As O.Chinnappa Reddy, J. observed, "that though that is the ordinary
rule, it is not an invariable rule". There may be situations necessitating
departure from the rule, but then such instances must be justified by
compulsions and not by compromise. It must be justified by compelling reasons
and not by just convenience".
The
law is, thus, clear that ordinarily all contracts by the Government or by an
instrumentality of the State should be granted only by public auction or by
inviting tenders, after advertising the same in well known newspapers having
wide circulation, so that all eligible persons will have opportunity to bid in
the bid, and there is total transparency. In our opinion this is an essential
requirement in a democracy, where the people are supreme, and all official acts
must be actuated by the public interest, and should inspire public confidence.
In the
present case, unfortunately, the High Court's attention was not drawn to the
aforementioned legal principles.
Furthermore,
we see force in the submission of Mr. Jayant Bhushan, learned senior counsel
for the appellant, that it was not for the High Court to fix the terms and
conditions of the Contract. It is for the state authorities to take a policy
decision and fix the terms and conditions of the Contract. It is one thing to
say that the High Court in exercise of power of judicial review may strike down
the contract or a notice inviting the tender if it offends Article 14 of the
Constitution of India, but it is another thing to say that the High Court in
exercise of the power of judicial review would thrust a contract upon a
non-willing party particularly when the said exercise would be violative of
Article 14 of the Constitution. Yet again, save and except in some very rare
and exceptional case, the question of fixing any terms of the Contract or
laying down the terms and conditions is for the concerned authority to decide,
and it is not a matter within the domain of the Courts. In this behalf, we may
refer to a decision of this Court in Association of Registration Plates vs.
Union of India & Ors. reported in (2005) 1 SCC 679, wherein this Court
opined:
"The
fifteen years' contract period has also been supported by the Union of India
and State authorities. We find great substance in the submissions made on the
data supplied as a justification for awarding the contract for a long period of
15 years. There would be a huge investment required towards the infrastructure
by the selected manufacturer and the major return would be expected in initial
period of two years although he would be bound down to render his services for
future vehicles periodically for along period. Looking to the huge investment
required and the nature of the job which is most sophisticated, requiring
network and infrastructure, a long-term contract, if though viable and
feasible, cannot be faulted by the court. If there are two alternatives
available of giving a short-term or a long-term contract, it is not for the
court to suggest that the short-term contract should be given. On the subject
of business management, expertise is available with the State authorities. The
policy has been chalked out and the tender conditions have been formulated
after joint deliberations between authorities of the State and the intending
manufacturers. A contract providing for technical expertise, financial
capability and experience qualifications with a long term of 15 years would
serve the dual purpose of attracting sound parties to stake their money in
understanding the job of supply and safeguard the public interest by ensuring
that for a long period the work of affixation of security plates would continue
uninterrupted in fulfillment of the object of the scheme contained in Rule 50.
Our considered opinion, therefore, is that none of the impugned clauses in the
tender conditions can be held to be arbitrary or discriminatory deserving their
striking down as prayed for on behalf of the petitioners." (emphasis
supplied) In the present case, the respondent no.1 challenged the impugned
advertisement dated 6.12.2004 issued by the Nagar Nigam. We have carefully
perused the said advertisement and find no illegality in the same.
It has
been held by this Court in several decisions that the Court should not
ordinarily interfere with the terms mentioned in such an advertisement.
Thus
in Global Energy Ltd. and Anr. vs. Adani Exports Ltd. and Ors. 2005(4) SCC 435
this Court observed (vide para 10) :
"The
principle is, therefore, well settled that the terms of the invitation to
tender are not open to judicial scrutiny and the courts cannot whittle down the
terms of the tender as they are in the realm of contract unless they are wholly
arbitrary, discriminatory or actuated by malice." Similarly in Master
Marine Services (P) Ltd. vs. Metcalfe & Hodgkinson (P) Ltd. and Anr.
2005(6) SCC 138, this Court held that the modern trend points to judicial
restraint in reviewing the administrative action. The court does not sit as a
court of appeal over such a decision but merely reviews the manner in which the
decision was made. The court ordinarily would not interfere with an
administrative decision. The Government must have freedom of contract. Some
fair play in the joints is a necessary concomitant for an administrative body
functioning in an administrative sphere.
We
have carefully perused the impugned advertisement and we do not find any
arbitrariness, discrimination or malafides in the same. Hence the High Court
had no justification for interfering with the said advertisement.
For
the reasons aforementioned, we have no other option but to hold that the
impugned judgment is unsustainable. It is set aside accordingly.
The
question, however, arises what direction should be passed by us now, considering
the fact that the impugned advertisement was issued on 6.12.2004. We think that
the interest of justice would be subserved if the appellant Corporation is
directed to issue an advertisement in well known newspapers having wide
circulation again calling for bids on such terms and conditions which it may
find to be reasonable within six weeks from the date of communication of this
order. The bids offered pursuant thereto must be opened and a final decision
must be taken within eight weeks thereafter.
Till
such time it will be for the appellant-Corporation to decide as to how the
slaughter house should be allowed to function by making such interim
arrangement as it may find fit and proper.
Although
the State of U.P. had rejected the proposal of the Municipal Corporation, we
direct the State to have a fresh look at the matter and to consider the
feasibility/desirability of grant of a licence to run the slaughter house for a
longer period than one year on the condition that the plant should be
modernized by the licencee. In our opinion, such a policy decision may be
required to be taken keeping in view the health and welfare of a large number
of inhabitants of the vicinity where such abattoirs are functioning, as also vis-`-vis
the health of the inhabitants of the locality, which is a fundamental right
under Article 21 of the Constitution of India. If a policy decision is taken by
the State, it goes without saying that the appellant- Corporation in future may
act in terms thereof, unless otherwise provided for by the Statute.
Although
the matter is not before us, however, keeping in view the fact that now it is
widely felt that a modern abattoir should be constructed, as was noticed by
this Court in Buffalo Traders Welfare Association (supra), which ensures hygiene
and sanitation, we would request the High Court to consider the desirability of
disposing of Civil Misc. Writ Petition No. 11069/2006 (Asaf Ali vs. State of
U.P. & Ors.) as expeditiously as possible.
Save
and except the aforementioned directions, we are of the opinion that the
Corporation may work out the other modalities as it deems fit and in accordance
with law. If respondent No.1 has deposited any amount for the modernization of
the plant, which has not been carried out, the Corporation may refund the
amount subject to any outstanding dues.
The
appeal is allowed accordingly. No costs.
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