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SUPREME COURT OF INDIA
SURINDER SINGH NIJJAR AND A.K. SIKRI, JJ.
RISHI KIRAN LOGISTICS PVT. LTD. – Appellants
VERSUS
BOARD OF TRUSTEES OF KANDLA PORT TRUST & ORS. – Respondents
Civil Appeal No.4655 of 2014 [Arising out of Special Leave Petition (Civil) No. 7301 of 2011]
Decided on : 21-4-2014
(2008) 12 SCC 500; (2009) 6 SCC 171; (1994) 6 SCC 651; (2012) 6 SCC 464 – Relied upon
(b) Promissory Estoppel – Appellant depositing only the EMD along with the bid – LOI clearly stating that lease documents would be executed after receipt of CRZ clearance which was received after five years – Lease document never executed – Appellant not prejudiced in any way by cancellation of tender process – Doctrine of promissory estoppels not attracted. (Para 25)
(2008) 12 SCC 500; (2006) 13 SCC 706 – Relied upon
(c) Constitution of India – Article 226 – Only public law remedy can be invoked under Article 226 – Contractual dispute is outside its purview – However a contractual dispute having a public law element would be covered. (Para 29)
(d) Administration of Justice – Judicial Review – Contract Act, 1872 – Section 10 – LoI only shows intention to enter into contract – Conditions not fulfilled – Contract not resulting – Appellant taking calculated risk in not going to the civil court and choosing to invoke writ jurisdiction – Cancellation not improper. (Para 34, 36)
(2008) 12 SCC 500 ; JT 2013 (10) SC 300; AIR 2006 SC 871 – Relied upon
Facts of the case:
The Board of Trustees of Kandla Port Trust took a decision, sometime in the year 2005, to allot its plots on leasehold basis for a period of 30 years enabling the allottees thereof to put up the construction of liquid storage tanks. The requisite permission from the competent authority under CRZ was to be obtained by the Kandla Port Trust.
Bids were finalized. However the CRZ clearance took five years. In the circumstances the Port Trust cancelled the tender process.
All these affected persons challenged the validity of cancelation of tender process by the Port Trust by preferring Writ Petitions. All these petitions were dismissed by the High Court.
Finding of the Court:
Cancellation of t ender process by the Kandla Port Trust is not arbitrary.
Result : Appeal dismissed with cost.
JUDGMENT
A.K. Sikri, J. –
Leave granted.
2. The factual matrix which needs to be taken note of, for the purpose of deciding the present appeal, unfolds as under:- Respondent No. 2 herein, viz., the Board of Trustees of Kandla Port Trust (hereinafter referred to as the 'Port Trust') has number of plots, in and around Kandla Port, which are of different sizes. The Port Trust took a decision, sometime in the year 2005, to allot these plots on leasehold basis for a period of 30 years for the purpose of enabling the allottees thereof to put up the construction of liquid storage tanks. For this purpose the Kandla Port Trust issued notice inviting tenders dated 12.3.2005. The annual rent in respect of these plots was fixed at a nominal rate of Re. 1/- per plot. However, the bidders were required to submit the price bid in the form of premium in respect of the concerned plots for which they intended to bid. The basic value of this premium was fixed at Rs. 612/- per sq. mtr. The bids were to accompany the earnest money deposit of Rs. 3 lakhs per plot. As per the prescribed procedure in such matters, the Port Trust held pre-bid meeting on 21.4.2005 wherein the terms of NIT of the bidders were explained and querries answered. The bidders were also informed that since these plots fall under Coastal Regulatory Zone (CRZ), requisite permission from the competent authority under CRZ was required which would be obtained by the Kandla Port Trust. However, at the same time it was also made clear that any specific clearance like safety, pollution control etc. was to be obtained by the individual lessee (s). This was also reiterated vide communication dated 25.5.2005. In this letter it was also stated that the successful bidder was required to pay the premium within a period of 3 months from the issuance of formal letter of allotment or CRZ clearance whichever was earlier. One more pre-bid meeting was held on 20.6.2005 and, thereafter the last date of submitting the tender was also postponed and subsequently fixed as 11.8.2005.
3. The appellant submitted its bid in respect of Plot Nos. 14, 15 and 17. The technical bids of the bidders, including that of the appellant, were opened on 11.8.2005. Bid of the appellant was found to be technically qualified. Thereafter, price bids were opened on 30.8.2005. These bids were scrutinised by the Tender Committee of the Port Trust. Recommendations were placed before the Board of Trustees in its meeting held on 8.12.2005. It was followed by communication dated 7.1.2006 to the appellant in the form of Letter of Intent (LOI), inter alia stating that the leasehold rights in respect of Plot Nos. 14, 15 and 17 were given for a premium of Rs. 3,200/- per sq. mtrs., 3,150/- per sq. mtr. and 3,120 per sq. mtr. respectively. This communication further mentioned that the formal letter will be issued to the appellant after the receipt of CRZ clearance in general.
4. The letter of allotment to the various successful bidders went into limbo thereafter, presumably awaiting CRZ clearance. The Gandhidham Chamber of Commerce and Industry was informed about this road block by the Port Trust in response to its representation, wherein the Port Trust also requested the said Chamber of Commerce and Industry to use its good office with the Ministry of Environment and Forest, Union of India for early clearance of CRZ permission.
5. It appears that CRZ clearance was ultimately received on 16.8.2010. However, this occurred more than 5 years after the NIT dated 12.3.2005 was floated. This prolonged time lag resulted in taking decision by the Board of Trustees on 9.12.2010, in the form of Resolution No. 108, deciding to cancel the tender process started in the year 2005. This decision of the Port Trust was conveyed to the appellant vide letter dated 9.12.2010. Similar letters were written to other tenderers as well who were issued similar LOI's.
6. All these affected persons challenged the validity of Resolution No. 108 of the Port Tru
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