1995 Supreme(AP) 512

Andhra Pradesh High Court
Judges : B.S.A.SWAMY, M.N.RAO
APSRTC rep.by its Vice Chairman and managing Director, Hyderabad - Appellant
Versus
V.Mallesh - Respondent
Decided On : 08-30-95

The power to grant licence for canteen/stalls/shops in the premises of the Corporation was not delegated to the Managing director.

Headnote:

LICENCE RENEWAL - CIRCULAR NO. 5/90 - INTERPRETATION - APPLICABILITY - CIRCULAR NO. 8/90 - VALIDITY - DELEGATION OF POWERS - BOARD OF DIRECTORS - RESOLUTION - AUTHORITY - NOMINATION BASIS - LICENCEES - ENTITLEMENT - LEGITIMATE EXPECTATION - ESTOPPEL - PUBLIC INTEREST - TENDER SYSTEM - POLICY DECISION - CLASSIFICATION - ARTICLE 14 - CONSTITUTION OF INDIA - CONTRACTUAL OBLIGATIONS - WRIT JURISDICTION - ARTICLE 226 - CONSTITUTION OF INDIA.

Fact of the Case:

The dispute arose from a common order dated 20-2-1995 and 22-2-1995 in W. P. No. 14612/94 by a learned single Judge of the High Court of Andhra Pradesh. The respondents in all these appeals can be categorised into two groups: (1) Existing licence holders whose licences are being renewed from time to tune after completion of 12 years period at Central Bus station (for short "C. B. S.") Gowliguda pending completion of construction of bus complex at Imliban and who have also been allotted open space at Imliban during the year 1990 to erect temporary sheds for the purpose of running canteen, pan shop and cycle stand as a stop gap arrangement consequent on shifting the operation of buses running on Kurnool sector to Imliban, and (2) Existing licence holders at C. B. S. Gowliguda, who have not completed the 12 year licence period.

Finding of the Court:

1. Circular No. 8/90 issued by the Vice Chairman and Managing Director is not supported by any resolution of the Board of Directors and the same is void. 2. The commissions and omissions on the part of the officials of the Corporation gave rise to a legitimate expectation in the minds of these licencees that the appellant-Corporation would be alloting canteens/stalls/shops at Imliban by enhancing the licence fee through negotiations. 3. The respondents in Writ Appeal Nos. 236, 235 and 229/95 who were given licences on nomination basis at Imliban pending completion of construction of bus complex cannot claim any benefit under Circular No. 5/90 as the same is intended to cover the contractors who were given licences in the open tender system, but not on nomination basis. 4. As far as the other respondents in W. A. No. are concerned, the learned judge ought to have held that their licences are co-terminus with the closure of the existing bus station, more so, in the light of the terms and conditions of the licence which are reduced to writing, at any rate, after the expiry of the regular lease period, the licences of these respondents are being extended for shorter periods under resolutions passed by the Board of directors from time to time wherein the Board of Directors made their intention explicit to put the sheds at the Imliban to auction. 5. Pursuant to these resolutions, the respondents entered into agreements with the appellant-Corporation from time to time and one of the specific Clauses of the agreement being that under no circumstances, the licencee shall have no claim for continuation of the business in C. B. S. Hyderabad beyond the stipulated period and this will not confer any right on the part of the licencee for continuation of business in Imliban. As such, these respondents cannot take any shelter under Circular No. 5/90. 6. At no point of time, the Corporation ever gave any promise to any of the respondents that they will be permitted to shift to the new premises dispensing with tender system. Hence, the question of either promissory estoppel or legitimate expectation does not arise. 7. The respondents are estopped by conduct to claim any benefit under circular No. 5/90.

Issues: 1. Whether Circular No. 8/90 issued by the Vice Chairman and Managing Director is valid? 2. Whether the respondents in Writ Appeal Nos. 236, 235 and 229/95 who were given licences on nomination basis at Imliban pending completion of construction of bus complex can claim any benefit under Circular No. 5/90? 3. Whether the licences of the respondents are co-terminus with the closure of the existing bus station? 4. Whether the respondents can claim any benefit under Circular No. 5/90? 5. Whether the respondents are estopped by conduct to claim any benefit under circular No. 5/90?

Ratio Decidendi: 1. The power to grant licence for canteen/stalls/shops in the premises of the Corporation was not delegated to the Managing director. 2. Circular No. 5/90 has no application to the facts and circumstances. 3. The respondents are fully aware of the fact that the arrangement was only a stop gap one intended to cater to the needs of travelling public due to temporary shifting of operation of the buses on Kurnool Sector, but not on regular basis under any policy. 4. The respondents by their conduct are estopped from contending that they are entitled for renewal of their licences for a total period of 12 years from the date of initial allotment asper Circular No. 5/90 dated 12-1-1990.

Final Decision: 1. Writ appeals Nos. 236/95, 235/95 and 229/95 are allowed and the order of the learned judge in W. P. Nos. 4115/94,4226/94 and 4214/94 is set aside. 2. Writ Appeal Nos. 230/95 and 711/95 are allowed and the order of the learned Judge in W. P. Nos. 11584/94 and 14612/94 is set aside. 3. Writ Appeal No. 234/95 is allowed and the order of the learned single Judge in W. P. No. 13909/94 is set aside.