Sandeep Diwakar Joshi v. Corporation of the City of Nagpur
2009-07-14
A.P.BHANGALE, D.D.SINHA
body2009
DigiLaw.ai
A. P. BHANGALE, J.:- Heard submissions. 2. This petition is directed against contract dated 30.5.2005 entered into between the Nagpur Municipal Corporation (respondent no. 1) and Dattatraya Advertising Company (respondent no.3). The petitioner seeks quashing of the entire tender process relating to the contract for erection of Cantilever/ Gantry Road Sign Board System and also seeks mandamus to the respondents to remove all the gantries erected on the roads of the city pursuant to the said contract. 3. Briefly stated, it is the case of petitioner that in the year 2001 outdoor advertising policy was promulgated by the Nagpur Municipal Corporation for City of Nagpur after the decision to beneficially use the back-side of Cantilever for advertisement on 27.2.2004. Advertisement was published inviting tenders for grant of contract for advertisements on existing cantilever signboards by reserving any right to reject or accept any tender in the interest of the Corporation. Another tender notice dated 1.4.2004 was published offering advertising media right for cantilever; Gantries Road sign Boards on Build, Operate and Transfer (BOT) basis. On 4.8.2004 one more tender notice offering advertising rights on BOT Basis was published from Nagpur Municipal Corporation by which advertising media rights in Cantilever; Gantries Road-sign Boards were offered for period not more than fifteen years. In all these advertisements, the Corporation had reserved its right to accept or reject any tender in the interest of Municipal Corporation, Nagpur' During the course of correspondence and negotiations between respondent no. 1 and respondent no.3, written contract for construction and maintenance of Gantry was entered into on 30.5.2005 which was duly approved by the Standing Committed of the Municipal Corporation. Work Order was issued on 16.6.2005. 4. The petitioner alleged gross irregularities and corruption in the tender process, further alleging violation of outdoor advertising policy during the course of negotiations between Traffic Engineer on behalf of Municipal Corporation and the only bidder who had increased his offer by 5%. According to the petitioner, the price quoted was below the off-set price i.e. Rs.96.56 per square meter. Further, according to the petitioner, only those bids which are above off• set price i.e. premium can be considered. The petitioner alleged that on the basis of letter dated 2.3.2005 bidder revised bid to Rs.11/per square meter as premium charges along with fixed ground-rent and licence fee for illuminous display on municipal roads in Nagpur.
Further, according to the petitioner, only those bids which are above off• set price i.e. premium can be considered. The petitioner alleged that on the basis of letter dated 2.3.2005 bidder revised bid to Rs.11/per square meter as premium charges along with fixed ground-rent and licence fee for illuminous display on municipal roads in Nagpur. The Traffic Engineer had approved the proposal and forwarded it to the Chief Accounts and Finance Officer who approved the rates and asked contractor to obtain No Objection Certificate from the Public Works Department and the National Highway before forwarding it to the Municipal Commissioner. The petitioner alleged that the Municipal Commissioner had simply forwarded the proposal to the Standing Committee for consideration. Standing Committee approved the proposal in its meeting dated 29.3.2005 and sent it to the Municipal Commissioner for implementation. Along with his no objection certificate for its implementation the second respondent approved the proposal. Draft agreement was prepared and put up for approval of the second respondent who granted approval by order dated 7.5.2005. In the result, agreement was executed between the respondents which was independent than the one embodied in tender documents. Thus, the petitioner alleges that there was marked departure from usual tender process before new contract was executed alleging that new contract was advantageous to the bidder. Work Order was issued on 16.6.2005 permitting installation of gantry signage system. On twelve locations which included location on PWD and National Highway roads without obtaining NOC from those authorities. The petitioner alleged that later permission for change of locations was also approved by the Municipal Commissioner and contended that under the garb of earlier contract a new contract is awarded without following due process of law and the interest of the Corporation was relegated to a secondary position by permitting gantry structures i.e. hoarding boards hugely illuminated with advertisements on both sides using conventional energy. For illumination although respondent no.2 had noted that illumination be done by solar energy especially in the days of acute shortage in the State. Thus, according to the petitioner, decision to permit erection of gantries was bad and illegal as bids were called for cantilever road signage system and not gantry signage system.
For illumination although respondent no.2 had noted that illumination be done by solar energy especially in the days of acute shortage in the State. Thus, according to the petitioner, decision to permit erection of gantries was bad and illegal as bids were called for cantilever road signage system and not gantry signage system. According to the petitioner cantilever signage system is smaller in size and the boards do not extend to the entire breadth of the road and small projections are made high on the road while gantry signage system is running across the entire breadth of the road somewhat like huge welcome arch. Petitioner thus alleged that the entire tender process was illegal, malafide offending the outdoor advertising policy of the Corporation and the contract ought not to have been awarded to the third respondent Dattatraya Advertising Company which, according to the petitioner, was obtained by fraud and liable to be revoked. 5. The petitioner claims that he is elected corporator from Laxminagar Ward, presumably aware of the Rules, Bye-laws and the conditions of tender notice and award of contract by the Municipal Corporation. He claims that due to the contract awarded to respondent no.3 direct loss of Rs.13-14 crores was caused to the Corporation during the contractual period and hence, in public interest. he has filed petition. 6. It is not in dispute that off-set price fixed by the Nagpur Municipal Corporation was Rs.400/- per square meter per year for ground rent. Respondent no.3 had originally offered Rs.48/- per square meter and during the negotiations, the offer was increased to Rs.400/- per square meter per year towards ground rent. Therefore, it cannot be said that it is a case of commercial exploitation. This Court by order dated 22.10.2008 directed petitioner to deposit Rs.1 lakh by way of costs on condition that it shall stand forfeited if the petition fails and is refundable if the petition succeeds. Thus, the amount of Rs. 1 lakh deposited by the petitioner, was directed to be deposited in a nationalised bank in fixed deposit initially for six months vide order dated 17.12.2008. 7. On behalf of respondents no.1 and 2, it is contended that norms prescribed by the Indian Road Congress in respect of gantries were satisfied in the present case on all sites belonging to the Corporation.
7. On behalf of respondents no.1 and 2, it is contended that norms prescribed by the Indian Road Congress in respect of gantries were satisfied in the present case on all sites belonging to the Corporation. It is further contended that norms of the Corporation will prevail, but even assuming that norms of Highway Department are made applicable, even then there was no violation of any condition of outdoor advertising policy of the Corporation. According to respondents no.1 and 2. policy relating to display of hoardings or advertising boards was prepared pursuant to direction of this Court in Writ Petition No.4175 of 1999. Respondents no. I and 2 submitted that in February, 2004 it had taken decision to use the back-side space of road signage boards for advertising purpose and invited offer from the public by floating tender. Initial two offers were conditional and hence rejected and fresh offers were invited giving adequate publicity to offer on BOT basis with concession period not exceeding 15 years. Thus, only one offer from respondent no.3 was received with initial price bid below off-set price when bid was opened on 19.10.2004. Traffic Engineer had submitted the bid for consideration to the Chief Accounts and Finance Officer who, in turn, suggested that the offer made by tenderer be negotiated for premium over and above the price bid. Tenderer had accepted the condition and increased the bid pursuant to negotiation resulting in the agreement and thus work order dated 16.6.2005 was issued in respect of 12 locations. No Objection Certificate was obtained from the Public Works Department and the National Highway Department before commencement of construction of gantry, but no gantry was erected on National or State Highways. Hence, no prior permission was necessary from Highway authorities. Respondents no. 1 and 2 denied having shown any unusual interest to award contract. It is also contended that there is no obstacle or hindrance to the road and that there was no financial burden upon the Corporation as the offer was invited on BOT basis. It is contended that the petitioner as a Municipal Councillor had not raised any issue in respect of awarding contract in the house. The issue is raised after the contract was concluded. Hence, petitioner is not coming to the Court with clean hands and the petition is not filed in public interest.
It is contended that the petitioner as a Municipal Councillor had not raised any issue in respect of awarding contract in the house. The issue is raised after the contract was concluded. Hence, petitioner is not coming to the Court with clean hands and the petition is not filed in public interest. It is submitted that tender process was open to scrutiny at various stages and could have been questioned in the House of Corporation. The petitioner, though Councillor, never questioned the decision to award contract before the House. The erection of signage boards in the city was necessary from traffic point of view requiring the Corporation to spend from its common funds. The Corporation, therefore, decided to award contract on BOT basis with a right to use available space for display of advertisement, saving money of the Corporation while ensuring erection of signage boards. It is also submitted that scope of judicial review is restricted to decision-making process only and the petitioner has failed to show that selection of contract was vitiated. Thus, respondents prayed for rejection of petition. 8. Respondent no.3 contended that petitioner as a corporator was fully aware of daily affairs of the Corporation and has filed this petition at the instance of Cartel Advertising System; an unsuccessful bidder. Hence, petition must fail. 9. About impugned contract between respondents, we must note that the Municipal Corporation, Nagpur does possess legal right as it is a legal entity under the City of Nagpur Corporation Act, 1948. Hence, the Corporation can enter into a commercial and profitable contract after due negotiations with any party or person, and is entitled to insist its performance. Unless the Local Authority is shown to have acted arbitrarily, malafide, not justified by public interest the Court cannot interfere. The Court would be very reluctant to interfere with freedom of contract when the local authority appears to have acted in accordance with law, reasonably in good faith and if decision-making process was rational, not arbitrary or violative of Article 14 of the Constitution of India. In our opinion, the petitioner is unable to show that the respondent Corporation acted illegally or improperly while awarding contract on 30.5.2005, particularly bearing in mind that the petitioner could have questioned or objected the contract in the House of Municipal Corporation before it was duly confirmed in the House after it was sanctioned by the Standing Committee.
In our opinion, the petitioner is unable to show that the respondent Corporation acted illegally or improperly while awarding contract on 30.5.2005, particularly bearing in mind that the petitioner could have questioned or objected the contract in the House of Municipal Corporation before it was duly confirmed in the House after it was sanctioned by the Standing Committee. Petitioner also had alternate statutory remedy under Section 407 of the City of Nagpur Corporation Act to appeal to the State Government if he was aggrieved by the contract in question. The petitioner did not avail of alternate statutory remedy available to him in law. Even otherwise, disputed facts can be decided on appreciation of evidence in a suit validly instituted. Alternate remedy, if available, has to be exhausted first before invoking extraordinary jurisdiction under Article 226 of the Constitution of India. 10. Petitioner is Corporator of the Nagpur Municipal Corporation and it is contended that he was in the ruling party. He knew about contract which was awarded on 30th May, 2005 and in respect of which Work Order was issued on 16th July, 2005. Petitioner as a municipal Councillor was well aware of the entire negotiations which culminated into contract. He never raised any issue in respect of awarding of the contract in the House of Corporation, but raised the issue after the contract was executed. It is also contended that the entire tender process was open to scrutiny at• various stages and could have been questioned in the House of Corporation, but the petitioner did not question the decision to award contract although he was a Corporator and was aware that notice in respect of tender process was first published on BOT basis in 2004; contract was awarded on 30th May, 2005 and the Work Order was issued on 16th July, 2005. When the petitioner was sitting Corporator, he had every opportunity to enquire and question the contract when it was at the stage of negotiation. He cannot feign ignorance in respect of entire tender process, negotiations and the fact that contract was concluded pursuant to negotiations as also after approval from the Standing Committee and the Municipal Commissioner. In the absence of evidence, we cannot draw inference against Municipal Commissioner to the effect that he did not act bonafide in the course of his duty while confirming the contract.
In the absence of evidence, we cannot draw inference against Municipal Commissioner to the effect that he did not act bonafide in the course of his duty while confirming the contract. Moreover, the petition was filed on 12th April, 2006, the petitioner is also blame-worthy for delay and laches since the petitioner was sitting corporator of the Corporation and was aware of the entire process of awarding contract. Therefore, the delay, in the facts and circumstances of this case, is fatal to the petition. We also do not find any arbitrariness or malafides on the part of respondents. We do not find unfairness or any basic infirmity in the matter of negotiations pursuant to which contract was awarded in this case in favour of respondent no.3. In our view, the Court cannot substitute its own opinion nor can it act as an appellate authority in respect of selection made by the Nagpur Municipal Corporation to enter into contract with respondent no.3. Mere power to choose a contractor cannot be termed as arbitrary. In our opinion, the decision by respondents no. 1 and 2 to negotiate and then to choose respondent no.3, was within the realm of law. Decision to accept contract by the process of negotiation after the offer was approved by the Standing Committee and the Municipal Commissioner, it was confirmed in the House of Corporation. In facts and circumstances, therefore, we do not find any reasonable ground to interfere with the contract in question. 11. Individual dispute can never be allowed to be converted in public interest litigation, because it is quite possible that unscrupulous litigant may use Public Interest Litigation as an instrument of coercion, blackmail or other oblique motive, as held by the Apex Court. Considering the facts and circumstances involved in the petition, this case cannot be termed as public interest litigation as the petitioner who was sitting corporator of the Nagpur Municipal Corporation was well aware of the entire tender process and negotiations which resulted into contract. The fact that he filed this writ petition on 12th April, 2006 without explaining delay, gives rise to inference that he had oblique motive to file the petition. The petition, to our view, is frivolous. 12. Legal position is clear that Public interest litigation cannot be allowed to become tool in the hand of unscrupulous elements to release vendetta or wreck vengeance.
The petition, to our view, is frivolous. 12. Legal position is clear that Public interest litigation cannot be allowed to become tool in the hand of unscrupulous elements to release vendetta or wreck vengeance. It is held by the Apex Court in its decision reported in the case of M/s. Holicow Pictures Vs. Prem Chandra Mishra and ors. reported in AIR 2008 SC 913 : [2008 ALL SCR 404] as under: "Public interest litigation is a weapon which has to be used with great care and circumspection and the judiciary has to be extremely careful to see that behind the beautiful veil of public interest an ugly private malice, vested interest and/or publicity seeking is not lurking. It is to be used as an effective weapon in the armory of law for delivering social justice to the citizens. The attractive brand name of public interest litigation should not be used for suspicious products of mischief. It should be aimed at redressal of genuine public wrong or public injury and not publicity oriented or founded on personal vendetta. The Court must be careful to see that a body of persons or member of public, who approaches the Court is acting bona fide and not for personal gain or private motive or political motivation or other oblique considerations. The Court must not allow its process to be abused for oblique considerations by masked phantoms who monitor at times from behind. Some persons with vested interest indulge in the past time of meddling with judicial process either by force of habit or from improper motives, and try to bargain for a good deal as well to enrich themselves. Often they are actuated by a desire to win notoriety or cheap popularity. The petitions of such busy bodies deserve to be thrown out by rejection at the threshold, and in appropriate cases with exemplary costs." We are fortified in our conclusion in view of the abovementioned observations by the Apex Court. 13. Regarding allegation made by the petitioner against Municipal officials that they were hand-in-glove or indulged in corrupt practices to favour respondent no.3 advertising agency, we do not find iota of evidence adequate enough to infer any corrupt practice on the part of Municipal Commissioner or any other official of respondent no.1. In our view, petition is liable to be dismissed with exemplary costs being frivolous and filed with oblique motive.
In our view, petition is liable to be dismissed with exemplary costs being frivolous and filed with oblique motive. It must be noted that earlier the Court had required the petitioner to deposit sum of Rs. 1 lakh by way of costs vide order dated 22.10.2008 upon condition that if petition fails, the amount would be forfeited. In our view, respondent no.1 Municipal Corporation is entitled to claim the amount as exemplary costs. Since we find that the contract impugned in the petition is valid and sustainable in law, petition suffers from lack of merit. 14. In the result petition is dismissed with exemplary costs and the respondent Municipal Corporation is entitled to withdraw the amount of Rs. 1 lakh deposited by the petitioner, as directed by this Court, towards costs of the petition. Rule discharged accordingly. Petition dismissed.