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2017 DIGILAW 111 (JK)

HAJI MOHAMMAD MAQBOOL DAR v. STATE OF JAMMU AND KASHMIR

2017-03-03

RAMALINGAM SUDHAKAR

body2017
JUDGMENT : 1. The Writ petition has been filed for the following relief : (a) That the Writ of Certiorari may be passed whereby the impugned order/impugned Circular No. DULB/G/560/17-18/3538-3585, dated 25.02.2017, passed by the respondent No. 03 may be quashed. (b) That the writ of mandamus may be passed whereby the respondent No. 1 & 2 may be directed to permit the petitioners to continue and hold Municipal Posts till 30.06.2017 as recommended by respondent No. 03. (c) That a writ of mandamus may be passed whereby the respondent No. 1 and 2 may be directed to give effect to the recommendations given by the respondent No. 3 in substitution of their loss incurred by the petitioners during the period of unrest in the valley in the year 2016 by way of giving extension to their contracts for the year 2017-2018, from the date of expiry of financial year 2016-2017 for a period of three (03) months as recommended by respondent No. 03/Director Urban Local Bodies, Srinagar. (d) That the writ of mandamus whereby the respondent No. 1 & 2 may be directed to take a decision forth with on the recommendations passed by respondent No. 03. 2. The petitioners, seven in number hails from different districts, namely Budgam, Pulwama, Bandipora and Ganderbal. They are the beneficiaries of a contract with their respective Municipal Committees to collect Adda entry fee in an auction conducted by the respective Municipal Authorities for the financial year 2016-2017. These petitioners were found to be higher bidders and the contract was given to them to collect the above stated Adda entry fee, taxes etc. for the financial year 2016-17, w.e.f., 01.04.2016 to 31.03.2017. The condition of auction provides deposit of amounts as specified therein. On being declared successful bidders, petitioners have executed an agreement as required by the condition imposed and they have started collecting the Adda fee in respect of their Municipal areas. 3. An unfortunate event happened in the month of July 2016, which caused severe disturbance in the valley. The petitioners herein plead that their business of collecting the Adda entry fee was greatly affected. They state that they have deposited substantial amount and therefore, they are suffering from financial loss as there is no collection due to the turmoil. 4. 3. An unfortunate event happened in the month of July 2016, which caused severe disturbance in the valley. The petitioners herein plead that their business of collecting the Adda entry fee was greatly affected. They state that they have deposited substantial amount and therefore, they are suffering from financial loss as there is no collection due to the turmoil. 4. In the month of February 2017, Youth Contractors Association, Kashmir made a representation to the Director Urban Local Bodies, Kashmir/respondent No. 3 herein, ventilating their grievance that due to turmoil in the valley between July 2016 to November 2016, their business had been greatly affected and therefore, they prayed for various remedial measures. One of the request was for the extension of period of contract beyond 31st March 2017. The further request was that subject to additional payment, the said period could be further extended. They quoted similar extension done previously. This was considered by the Director Urban Local Bodies, Kashmir and in his proceedings dated 2nd February 2017, addressed to Commissioner Secretary to Government Housing and Urban Development Department, Civil Secretariat, Jammu vide No. DULB/G/1206/2084-87, pointing out the difficulties that was faced by the contractors during the period of turmoil, the decrease in collection of entry fee both by the contractors as well as by the Department. He stated that because of curfew, imposed by the District Authorities, these contractors suffered great loss. He also mentions that there has been steep decline in the collection of entry fee. In the said recommendation, Director Urban and Local Bodies, Kashmir has pointed out a similar situation which arose consequent to the devastating floods of September 2014 and the benefit given by the Government. Referring to the stand taken by the Government Administrative, Department in the flood situation he suggested certain measures to alleviate the grievance of the contractors in the present scenario. The recommendations are as follows :- (a) Only those contractors shall be considered for relaxation, who have already deposited 80% and above of the contract amount with the respective Committees and shall deposit the remaining 20% to the concerned Committee in one go, within fifteen days of giving such relaxation. (b) The contractors who are defaulters as on date and have not abided by the conditions of the contract shall be provided within an opportunity to deposit the outstanding amount of contract in one go, before considering for relief. (b) The contractors who are defaulters as on date and have not abided by the conditions of the contract shall be provided within an opportunity to deposit the outstanding amount of contract in one go, before considering for relief. (c) The entry fee contracts for the next financial year 2017-18 (Nine Months from 01.07.2017 to 31.03.2018) shall be continued with same contractors on the meagre increase of 0.25% in case of contractors of Rs. 50.00 lacs and above and 0.5% in respect of contracts below Rs. 50.00 Lacs with the condition that the contractor has to deposit the full amount of next year's contract (Nine Months) in one go during the first week of April, 2017. (d) The contractors who are not interested in continuing the contract beyond the expiry of present contract period, they may be provided only one month extension (from 01.04.2017 to 30.04.2017) (e) The contractors who will not agree to the aforesaid conditions may not be entitled for any kind of relief and legal remedies for affecting recoveries shall be initiated. (f) Since the proposed concession of three months for the next financial year shall affect the financial health of the institutions approximately to the extent of Rs. 240.86 lacs, the Government may consider to compensate the losses by providing financial assistance to support the municipalities to sustain the losses in the revenue during next financial year. The Institution wise details of decrease of next financial year with comparison to current financial year is forming as Annexure "B". 5. While on one hand, Director, Urban Local Bodies, Kashmir has given reasons as to why the period should be extended on certain terms, it appears that he also directed the initiation of process of issuing fresh tenders in his proceedings vide No. DULB/G/560/17-18/3538-3585, dated 25.02.2017. This circular calls upon the respective Municipal Authorities to float tenders for the financial year 2017-18, effective from 01.04.2017 to 31.03.2018, on certain specified conditions which are identical to the one contained in the previous year. 6. Aggrieved by this the present writ petition has been filed for the above stated relief. 7. Heard Mr. Shakir, Adv. for the petitioners and Mr. Beigh, learned counsel for the respondents at length. 8. In view of the nature of relief sought, writ petition is admitted to hearing and taken up for final disposal. 6. Aggrieved by this the present writ petition has been filed for the above stated relief. 7. Heard Mr. Shakir, Adv. for the petitioners and Mr. Beigh, learned counsel for the respondents at length. 8. In view of the nature of relief sought, writ petition is admitted to hearing and taken up for final disposal. The contention of the learned counsel for the petitioner is as follows :- (i) That the Director, Urban Local Bodies, Kashmir has already recommended that the contract be extended for a further period of 3 months and having recommended so he ought not to have issue the circular calling for fresh tenders. (ii) In the representation filed by the contractors' forum, they have raised an issue that they have suffered considerable loss due to unrest in the valley and to offset the loss. After consulting the ground level authorities, the recommendation has been made. Therefore, Government is bound to act upon this recommendation and take a decision on the representation made by the contractors on merits and grant extension. (iii) The Authority having recommended the extension of the period, should not direct to issue of fresh tenders, keeping in mind the past conduct whereby the Government Administrative Department granted relief is such a situation to the contractors as well. (iv) In the present case Government should come with a solution to alleviate the grievance of the petitioners. Learned counsel for the petitioners relies up on the statement made by the Minister concerned in this behalf. 9. Mr. Beigh, learned Additional Advocate General appearing on behalf of the State and other respondents submits that the conditions in the earlier tender are very clear and precise. In that tender, it was specifically mentioned that the period of contract would end by 31st of March 2017 at 6 P.m. He also pointed out specific Clause in the conditions as well as agreement signed by the parties which provides that no extension will be granted and contractors cannot claim any relief on the ground that they have suffered loss due to unfortunate or unfavourable circumstances like Bandh, Hartal etc. This condition is found in almost all the orders which are the subject matter of the earlier tender. The same conditions are imposed in the present circular. There is therefore, no arbitrariness or illegality in the approach. 10. This condition is found in almost all the orders which are the subject matter of the earlier tender. The same conditions are imposed in the present circular. There is therefore, no arbitrariness or illegality in the approach. 10. The issue is whether the Directors letter is binding on the Government and what is its value. Even if there is recommendation by the Director, Urban Local Bodies, Kashmir that cannot give the petitioners a right to demand extension of contract period because the decision ultimately has to be taken by the Government. Respondents further plea that in a contract between the two parties, Courts normally refrain from interfering on the terms and conditions unless it is found to be illegal or unlawful. In this case that situation does not arise. 11. The State has taken up the task of issuing tenders for collecting adda fee without discrimination. The recommendation of the Director Urban Local Bodies, Kashmir/ respondent No.3 herein is on the basis that the loss has been caused to the contractors due to unrest in the valley. He has suggested certain measures as to how the grievance of the contractors could be addressed. The Director has made this recommendation on the basis of discussion that he had with the Chief Executive Officers of the Municipal Committees. This recommendation is made to the Commissioner Secretary to Government Housing and Urban Development Department. The recommendation of the Director Urban Local Bodies, Kashmir is very clear that he leaves it to the discretion of the Government for relaxation and to grant extension of the contract on certain parameters. Therefore, to say that this recommendation binds the Government would be a fallacy. Since the suggestion is based on a complaint by the contractors in consultations with the officers of the Municipal level, the Government is bound to consider the same pragmatically. 12. So far as the contract is concerned, it ends on 31st March 2017. The parties are bound by the terms of contract. No dispute has been raised by the Municipal Committees or the Government at any point of time, nor is there any dispute raised by the petitioners alleging breach of contract, so as to suggest that it is a case for arbitration. This contention of the learned counsel for the petitioners has therefore no legal or factual basis. If the contract, ends on 31st March 2017, it has to end there. This contention of the learned counsel for the petitioners has therefore no legal or factual basis. If the contract, ends on 31st March 2017, it has to end there. 13. It is for the Government to consider the case of extension keeping in mind a similar situation that arose after September 2014, when the devastating floods hit the valley of Kashmir. It is for the Government to consider and extend it by one month or more if warranted. It is left to the Government as to it will address the grievance of the petitioners. If justified it is for the Government to grant compensation by any other method. Further the issue has to assessed from place to place and in respect of each District. There cannot be a uniform yardstick for all the cases at one go. 14. Having said so the question is whether respondents were correct in issuing the tender notice when there is a recommendation as above to the Government. The answer is "yes". The Government is duty bound to issue such tender notification at the appropriate time. If such tender notices are not issued in time then it will be a loss to public exchequer. It will have cascading effect and ultimately affect the individual Municipal Offices who are wholly dependent on this revenue. There is no reason for the Government to delay the tender. There will be number of intending tenders and the petitioners can also participate in the tendering process for the ensuing financial 2017-18. Their claim for compensation or measures to mitigate their alleged loss has to be assessed and a decision has to be taken by the Government if it feels justified. In a Contract between the petitioners and the Municipal Authorities the terms of the contract will be mutually binding. There is no scope for interference by Court, except by the terms of the contract. If there is dispute arbitration Clause is there. Hence there is no warrant for this Courts interference. 15. The measure of compensation is an issue that has to considered by the Government, if it chooses to. It is stated that the Hon'ble Minister has made certain observations. Therefore, the Government is directed to take a decision on this issue on or before 10th March 2017. The tender proceedings shall not be stalled. The relief A to D is therefore, declined. Prayer E is allowed as above. It is stated that the Hon'ble Minister has made certain observations. Therefore, the Government is directed to take a decision on this issue on or before 10th March 2017. The tender proceedings shall not be stalled. The relief A to D is therefore, declined. Prayer E is allowed as above. 16. The writ petition is disposed of in the above terms.