IMPORTANT POINT
Non floating of tenders or absence of public auction or invitation alone is no sufficient reason to castigate the move or an action of a public authority as either arbitrary or unreasonable or amounted to mala fide or improper exercise or abuse of power by the authority.

Headnote:Administrative Law-Hyderabad Municipal Corporation Act-Constitution of India-Articles 14 and 226-Permission granted by Municipal Corporation of Hyderabad to appellant to erect or display any advertisement/street signs/direction boards/arches on public roads/colonies etc. within twin cities of Hyderabad and Secunderabad -Writ petition challenging legality of permission granted-Petitioner asserting that the grant was opposed to public duties cast on Corporation, besides being opposed to principles of law-Materials on record substantiated absolute need and necessity to undertake works of nature executed by appellant, in furtherance of great public interest-No other private advertising agencies, including writ petitioner could offer to undertake such a venture in other available areas when their participation was sought for-Non floating of tenders or absence of public auction or invitation alone is no sufficient reason to challenge the grant.
Held : The materials on record substantiated the absolute need and necessity to undertake works of the nature executed by the appellant, in furtherance of great public interest and for larger public and common good. The admitted dire financial position of the Corporation and their inability to undertake such a project at the cost of the Corporation and the fact that the venture was long over due apparently made the Corporation authorities to avail of the project as unfolded and volunteered by the appellant, subject, of course, to further revisions, modifications and suggestions in the best interests of the Corporation. When it was undertaken as a pilot project on a trial basis there might not have been much certainty about the profitability of the scheme as a business venture for the private party concerned and the appellants were prepared to undertake the said risk and executed the works to the satisfaction of the authorities and appreciation of public as well. The risk involved is not only in recouping the investments to be made for installations and constructions but to maintain them in good, proper and working condition without also sacrificing the beauty of the installations throughout the duration of 15 years. Conditions imposed on the appellants involve great responsibilities and obligations and necessarily certain concessions had to be shown to keep the project working and maintain them in good shape. Not only the Municipal Corporation had no financial commitments in getting such works by any expenditure therefor, which were to be executed by the appellant only on self-financing basis generating the required funds for installation and continued maintenance and their upkeep from sponsors by collecting premiums for giving them the privilege to avail of the space permitted by the Corporation for advertisements but ultimately the whole works have to be left with the Corporation and it is not to be removed by the appellants. As rightly observed by the learned Single Judge the venture cannot be considered to be the grant of a largesse or lease or contract in the conventional sense. The provisions in the Municipal Corporation Act cannot be said to envisage situations of the nature, when enacted. This appears to be a project more akin to the one considered by this Court in G.B. Mahajan s case (supra). The fact that no other private advertising agencies, including the writ petitioner could offer to undertake such a venture in the other available areas when their participation was sought for belies the tall claims of the writ petitioner now made, after finding the project to have become successful and apparently fruitful - more perhaps than it could have been thought of, initially by everyone. Perhaps irked by this only the interests of the writ petitioner seem to have gained momentum, to try in desperateness for the Shylock s pound of flesh , to ruin the very project, unmindful of any concern for the Corporation, public good and the appellant. A careful and dispassionate assessment and consideration of the materials placed on record does not leave any reasonable impression, on the peculiar facts and circumstances of this case, that anything obnoxious which require either public criticism or condemnation by courts of law had taken place. It is by now well settled that non-floating of tenders or absence of public auction or invitation alone is no sufficient reason to castigate the move or an action of a public authority as either arbitrary or unreasonable or amounted to malafide or improper exercise or improper abuse of power by the authority concerned Courts have always leaned in favour of sufficient latitude being left with the authorities to adopt its own techniques of management of projects with concomitant economic expediencies depending upon the exigencies of a situation guided by appropriate financial policy in the best interests of the authority motivated by public interest, as well in undertaking such ventures. Though now, an attempt is sought to be made by the writ petitioner and surprisingly even by the Corporation too, attempting a somersault and claiming non-compliance with certain statutory formalities, we find that such a move is not only a pure after thought, but really unwarranted and not based upon a firm or sufficient ground or basis. The very applicability of the regulations contained in Sections 126, 129A, 148, 420 or 421 of the Act to the case on hand would itself be seriously doubtful. On the face of it they involve transactions envisaged therein, when granted in favour of third parties, to be executed with the Corporation funds and involving financial commitments or parting with the property or rights and privileges of the Corporation for value/consideration, and not to a self-financing scheme to be implemented and maintained without any financial commitments or expenditure to the Corporation. Section 124 seems to enable the Commissioner to undertake such ventures even without going before the Committee, as is now sought to be claimed. The provisions relating to Section 420/421 would also have relevance only when any such installations are to be made for the benefit/utility of private person/licensee, who executes it and not to a peculiar case like the one wherein the installations are such which are to be normally made and maintained by the Corporation for public good, but instead being permitted to be made on its behalf and at its behest by a private property for the use and benefit of public at large, which ultimately have to be left as the property of the Corporation only, and that too when executed on a self-financing basis. The Commissioner or other authorities of the Corporation, who seem to have undertaken this at a point of time when there is no concrete scheme/project or sufficient funds with the Corporation, appear to have embarked upon this venture in good faith, keeping in view not only the public good but also in an earnest endeavour to secure such a novel project executed without any financial commitments or expenditure whatsoever either for the installations or subsequent upkeep and maintenance for at least 15 years. Merely because as an ultimate outcome in the long range, the appellant is able to make some more profit than what was envisaged itself could not render the exercise undertaken or scheme executed vulnerable for being challenged to be either as one in improper abuse of powers or by means of any reprehensible/condemnable conduct, calling for interference in the hands of Court of Law. (Paras 16 and 17)

JUDGMENT

Raju, J.-Special leave granted.

2. The appellant, who was arrayed as second respondent in Writ Petition No. 22227 of 1994 before the High Court of Andhra Pradesh, filed by the first respondent in this Court, though succeeded before the learned Single Judge, lost before the Division Bench in Writ Appeal No. 712 of 1995, resulting in this appeal. The Writ Petition before the High Court was filed seeking for a writ of certiorari to call for the records of the Municipal Corporation of Hyderabad relating to the permission granted by the Corporation to the appellant to erect or display any advertisement/street signs/direction boards/arches on the public roads/colonies etc., within the twin cities of Hyderabad and Secunderabad and the permission granted for display thereon to the second respondent or to any other person and declare the same to be ultra-vires the provisions of the Hyderabad Municipal Corporation Act and Article 14 of the Constitution of India. The learned Single Juge dismissed the writ petition on the ground that the writ petitioner was not able to establish any illegality as alleged in the transaction. The learned Judge also adverted to the salient features of the transaction and the circumstances under which the work came to be entrusted to the appellant as well as the further fact that only two circles were taken up for putting up the boards and the other circles are always available for the petitioner or anyone else interested to approach the Corporation and undertake such work. It was also observed therein that the assignment entrusted to the appellant was not shown to be of any grant of largesse, as it did not involve exploitation of any property. Aggrieved, the writ petitioner moved the Division Bench and the Division Bench on 26.9.95 seems to have passed an order recording the willingness of parties as hereunder :

"After hearing the learned counsel for the parties, we wanted to know from the learned counsel for the Corporation if on similar terms and conditions the Corporation is prepared to award the contract to the Writ Appellant as was done earlier. Learned counsel submitted that 80 of the work is still remained to be completed and the Corporation will have no objection to grant to the Writ Appellant as well. Learned Counsel for the writ appellant also show the willingness of the writ appellant to take the contract on similar terms and conditions on which the second respondent in this writ appeal was granted contract. For setting the terms and the extent of the work to be entrusted to the writ appellant, in pursuance of the mutual agreement expressed before us by the learned counsel for the parties, both of them wanted some time. Accordingly time till 12.10.95 is granted. Put up on 13.10.95."

3. Notwithstanding, the writ petitioner appears to have been even thereafter without availing of the said order, pursued the litigation, as if on a public interest litigation and the Division Bench of the High Court by its order under challenge in this appeal allowed the appeal, as prayed for and directed termination of the contract and proceed to make an exercise afresh for the purpose. Certain relevant factual details have to be noticed for a proper appreciation of the respective contentions of the parties and the legal principles that should be really applied in adjudging the same.

4. The Corporation, though a metropolitan city, seems to have had no road names display anywhere and there appears to have been also no proper house numbering and the one in vogue was of a confusing pattern. The appellant appears to have volunteered to take up the rationalisation of house numbering in the twin cities by assigning house numbers in continuous series in each locality as house number, street number, locality, and also erect street sign boards indicating the name of the locality, street number, details of house numbers etc. The Corporation seems to have also had an idea of erecting for the use and benefit of public road d

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2003 Supreme(SC) 968

IMPORTANT POINTNon floating of tenders or absence of public auction or invitation alone is no sufficient reason to castigate the move or an action of a public authority as either arbitrary or unreasonable or amounted to mala fide or improper exercise or abuse of power by the authority.

Cases Referred (12)

IMPORTANT POINT
Non floating of tenders or absence of public auction or invitation alone is no sufficient reason to castigate the move or an action of a public authority as either arbitrary or unreasonable or amounted to mala fide or improper exercise or abuse of power by the authority.