Omics International Pvt Ltd v. state of ap, rep. By its principal secretary, youth services and sports department
2025-06-13
KIRANMAYEE MANDAVA
body2025
DigiLaw.ai
ORDER : KIRANMAYEE MANDAVA, J. 1. Heard Sri O.Manohar Reddy, learned Senior Counsel appearing on behalf of Sri Varun Byreddy, learned counsel for the petitioners, Sri B.Adinarayana Rao, learned Senior Counsel appearing on behalf of Sri N.Ravi Prasad, learned counsel for the 2 nd respondent and Sri N.Ashwani Kumar, learned counsel for the 3 rd respondent. 2. The issue that falls for consideration in the present writ petition is whether the 2 nd respondent is justified in issuing an advertisement inviting Expressions of Interest (EOI) from interested entities for acquiring the right to own and operate a franchise cricket team in the Andhra Premier League (APL), conducted by the 2 nd respondent, despite a prior decision taken by the 3 rd respondent to extend the petitioners’ franchise rights for a further period of 18 years. 3. The APL, founded on the lines of the Indian Premier League (IPL), was established to organise Twenty-Twenty cricket matches within the State of Andhra Pradesh. The 2 nd respondent constituted the APL Governing Council in 2022 and decided to commence the league’s matches in April 2022. The petitioners were granted franchise rights for six teams by both the 2 nd and 3 rd respondents in 2022. 4. It is the case of the petitioners that, in a meeting held on 20.03.2024, the 3 rd respondent resolved to extend the franchise period in their favour for an additional 18 years, with a corresponding enhancement of the existing franchise fee/base price. This resolution was allegedly approved by the General Body of the 2 nd respondent in its meeting dated 04.05.2024. The petitioners, by email dated 16.07.2024, expressed their gratitude to the 3 rd respondent for approving the extension, and, at request of the petitioners, the 3 rd respondent, by email dated 17.07.2024, forwarded the minutes of the Governing Council and Annual General Body Meetings evidencing such approval. 5. However, through the impugned proceedings, the 2 nd respondent has now initiated a fresh process by calling for EOIs from companies, joint ventures, or other entities interested in acquiring franchise rights in the APL, with the last date for submission of applications notified as 07.06.2025. Aggrieved by this action, the petitioners have approached this Court by way of the present writ petition. The matter was listed before the Vacation Bench on 06.06.2025, where the following interim order was passed.
Aggrieved by this action, the petitioners have approached this Court by way of the present writ petition. The matter was listed before the Vacation Bench on 06.06.2025, where the following interim order was passed. “Heard the submissions of Sri O.Manohar Reddy, learned Senior Counsel for the petitioners and Sri B.Adinarayana Rao, learned Senior Counsel for the respondents. The matter requires consideration. List on 19.06.2025 for filing counters of the respondents. Till such time, it is observed that respondent Nos. 2 and 3 are at liberty to receive and open the bids, however shall not finalize the bids.” 6. Subsequently, the respondents filed their respective counter-affidavits and vacate stay petitions. Thus, the matter is now taken up for final disposal. Learned Senior Counsel, Sri O.Manohar Reddy, appearing on behalf of the learned counsel for petitioners, submits that the 2 nd respondent, having already resolved to extend the petitioners’ franchise rights for 18 years, cannot now unilaterally initiate a fresh tender process, especially in the absence of any formal revocation of the earlier decision. He contends that such conduct is arbitrary and violative of settled legal principles. Referring to the original agreement, learned counsel points out that the 1 st petitioner had an option to extend the franchise period for 9 years with a 15% fee escalation every three years, which the petitioners have duly acted upon through annual payments and further argues that substantial payments were also made post confirmation of 18 year tenure. 7. It is contended that though no formal agreement was subsequently executed, the learned counsel argues that the decisions of the Governing Council and General Body, coupled with their communication to the petitioners through email dated 17.07.2024, constitute a valid offer and acceptance. As a public body, the 2 nd respondent is bound by the doctrine of promissory estoppel and cannot go back on its promise. In support of this contention, reliance is placed on the decision of Hon’ble Apex Court in Rickmers Verwaltung GMBH Vs. Indian Oil Corporation Ltd., , [ (1999) 1 SCC 1 ] wherein it was held as follows: “13.
In support of this contention, reliance is placed on the decision of Hon’ble Apex Court in Rickmers Verwaltung GMBH Vs. Indian Oil Corporation Ltd., , [ (1999) 1 SCC 1 ] wherein it was held as follows: “13. In this connection the cardinal principle to remember is that it is the duty of the court to construe correspondence with a view to arrive at a conclusion whether there was any meeting of mind between the parties, which could create a binding contract between them but the court is not empowered to create a contract for the parties by going outside the clear language used in the correspondence, except insofar as there are some appropriate implications of law to be drawn. Unless from the correspondence, it can unequivocally and clearly emerge that the parties were ad idem to the terms, it cannot be said that an agreement had come into existence between them through correspondence. The court is required to review what the parties wrote and how they acted and from that material to infer whether the intention as expressed in the correspondence was to bring into existence a mutually binding contract. The intention of the parties is to be gathered only from the expressions used in the correspondence and the meaning it conveys and in case it shows that there had been meeting of mind between the parties and they had actually reached an agreement upon all material terms, then and then alone can it be said that a binding contract was capable of being spelt out from the correspondence.” 8. Learned Senior Counsel for the petitioners contends that the intention of the 2 nd respondent can be discerned from its resolution dated 04.05.2024. Although no formal written agreement has been executed between the parties, the extension of the franchise rights was offered by the 2 nd respondent and duly accepted by the petitioners. It is argued that a valid offer, coupled with consideration and acceptance, constitutes a binding contract. In support of this submission, learned counsel further relies on the judgment of the Hon’ble Apex Court in Trimex International FZE Ltd., Dubai, Vs. Vedanta Aluminium Ltd., India , [ (2010) 3 SCC 1 ] to contend that the 2 nd respondent, having resolved to grant a further extension of the franchise for 18 years, cannot now go back from its commitment by issuing a fresh notification calling for EOIs.
Vedanta Aluminium Ltd., India , [ (2010) 3 SCC 1 ] to contend that the 2 nd respondent, having resolved to grant a further extension of the franchise for 18 years, cannot now go back from its commitment by issuing a fresh notification calling for EOIs. In Trimex International FZE Ltd., Vs Vedanta Aluminium Ltd., India , it is observed as follows: “49. In the light of the details which have been extracted in the earlier paragraphs, I am unable to accept the stand of the respondent. It is clear that if the intention of the parties was to arbitrate any dispute which arose in relation to the offer of 15-10-2007 and the acceptance of 16-10-2007, the dispute is to be settled through arbitration. Once the contract is concluded orally or in writing, the mere fact that a formal contract has to be prepared and initialled by the parties would not affect either the acceptance of the contract so entered into or implementation thereof, even if the formal contract has never been initialled. ------ 53. In the present case, where the commercial offer carries no clause making the conclusion of the contract incumbent upon the purchase order, it is clear that the basic and essential terms have been accepted by the respondent, without any option but to treat the same as a concluded contract.” 9. On the question of maintainability of the writ petition, learned Senior Counsel submits that since the 2 nd respondent is performing public functions and discharging public duties, any arbitrary action on its part would be subject to judicial review under Article 226 of the Constitution of India. He contends that the present dispute, involving the interpretation of resolutions and email communications between the parties, does not bar the jurisdiction of this Court under Article 226 of the Constitution of India. 10. Per contra, learned Senior Counsel Sri B.Adinarayana Rao appearing on behalf of Sri N.Ravi Prasad, learned counsel for the 2 nd respondent, submits that the original contract was only for a period of one or three years, as per the terms of the agreement, and that no clause providing for an extension is provided. He further referring to the resolution dated 04.05.2024 contends that the alleged extension contemplates execution of a formal agreement, as the resolution specifies certain rates for certain durations. 11.
He further referring to the resolution dated 04.05.2024 contends that the alleged extension contemplates execution of a formal agreement, as the resolution specifies certain rates for certain durations. 11. He thus argues that no concluded contract has come into existence, and therefore, reliance on the said resolution by the petitioners is misplaced. Learned counsel argues that interpretation of the resolution and related communications would necessarily involve adjudication on disputed questions of fact, which is beyond the scope of jurisdiction under Article 226 of the Constitution of India. He submits that if the petitioners are aggrieved, the proper remedy lies before the Civil Court having appropriate jurisdiction. The learned counsel further points out that the agreements relied upon by the petitioners contain an arbitration clause, and hence, the present writ petition is not maintainable. 12. Considered the rival submissions. 13. A perusal of the minutes of the meeting of the 3 rd respondent dated 20.03.2024 discloses that the said meeting was convened to deliberate on the future course of action of the 2 nd respondent (ACA) about Revenue Sharing, Auction Structure, Franchise Fee for the third year, Season 3 dates and Tentative Budget, and the Women’s T20 proposal etc., incidentally it appears to have come up for discussion during the said meeting, that a proposal was put forth suggesting the extension of ownership rights for existing franchise owners for 18 years, with corresponding incremental increases in the base price during the said period. The resolution passed at the 71 st AGM reads as follows: "It is unanimously resolved to accept and adopt the report of the Governing Council” 14. It is not clear from the AGM minutes if the proposal for extension of the franchise was separately put up for ratification. An omnibus acceptance of the report of the Governing Council cannot be construed as a valid offer in terms of the Indian Contract Act, 1872, and an email of the petitioners expressing gratitude cannot be termed as an “acceptance” in terms of the provisions of the Indian Contract Act, 1872. Although the said reports of the meeting were not initially communicated to the petitioners, it is evident that the 1 st petitioner addressed an email dated 16.07.2024 to the 2 nd respondent, expressing gratitude for the extension of the franchise for a further period of 18 years and requesting copies of the meetings to be furnished.
Although the said reports of the meeting were not initially communicated to the petitioners, it is evident that the 1 st petitioner addressed an email dated 16.07.2024 to the 2 nd respondent, expressing gratitude for the extension of the franchise for a further period of 18 years and requesting copies of the meetings to be furnished. Upon the request of the 1 st petitioner, the 2 nd respondent forwarded the relevant AGM documents by email dated 17.07.2024. After 17.07.2024, there has been no further communication between the parties in connection with the extension of the franchisee. 15. Learned counsel for the 2 nd respondent would submit that the relief sought by the petitioners is in pursuance of the resolution of the Governing Council. The relief sought involves a detailed examination of the documents, recording of the evidence and recording a finding of facts to the effect whether there was any element of ‘offer’, ‘consideration’ by the respondents and the ‘acceptance' in the subject transaction. They contends that the appropriate remedy would be before the Civil Court. It is further argued that there was no advance payment of 2025-26 was made if the 18 years contract was really granted is in force. The resolution dated 20.03.2024 is only internal minutes of the discussion which has no enforceability under law. In the absence of a formal signed document granting extension, the respondents are at liberty to issue/call for fresh EOI’s. 16. An internal discussion of the 2 nd respondent between its members about business expediency in extending the franchise for 18 years at a certain rate cannot be viewed as an offer, in terms of the Indian Contract Act, 1872, in the absence of formal communication to the petitioners revealing the intention of the 2 nd respondent to extend. In light of the same, the actions of the 2 nd respondent in issuing the advertisement and invitation dated 02.06.2025, calling for EOI’s cannot be termed as arbitrary and irrational, warranting interference under Article 226 of the Constitution of India. Having regard to the same, this Court is not inclined to grant the relief sought in the writ petition. 17. The writ petition is accordingly dismissed. There shall be no order as to costs. As a sequel, interlocutory applications, pending if any, shall stand closed.