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2003 Supreme(Cal) 649
High Court Of Calcutta
SUBHRO KAMAL MUKHERJEE
RIYAZ KHAN - Appellant
Versus
LIEUTENANT GOVERNOR - Respondent
W. P. 143 Of 2003
Decided On : 12/22/2003
ANJLI NAG, K.VIJAYA KUMAR
The Government has the freedom of contract and can adopt any method for execution of its works so long as the method is within the constitutional and legal limits.
Headnote:
SHIPPING LAW - ANDAMAN AND NICOBAR ISLANDS - MERCHANT SHIPPING ACT, 1958 - CIRCULAR ISSUED BY THE ADMINISTRATION EXCLUDING CARGO VESSELS BELOW 50 TONS FROM UNDERTAKING TRANSPORTATION/SHIPMENT OF GOVERNMENT CARGO ON MONTHLY LOWEST BID BASIS - VALIDITY - CHALLENGED.
Fact of the Case:
The petitioners, vessel owners, challenged the circular issued by the Andaman and Nicobar administration excluding cargo vessels below 50 tons from undertaking transportation/shipment of Government cargo on monthly lowest bid basis. They contended that such exclusion was unreasonable and arbitrary, and violated their fundamental right to carry on a trade or business.
Finding of the Court:
The court held that the administration's decision to exclude cargo vessels below 50 tons from undertaking transportation/shipment of Government cargo was not unreasonable or arbitrary. The court noted that the administration had assessed its requirements and decided to negotiate with vessel owners possessing vessels above 50 tons. The court also held that the administration was free to evolve any method for execution of its works so long as the method was within the constitutional and legal limits.
Issues: 1. Whether the administration's decision to exclude cargo vessels below 50 tons from undertaking transportation/shipment of Government cargo was unreasonable or arbitrary? 2. Whether the administration's decision violated the petitioners' fundamental right to carry on a trade or business?
Ratio Decidendi: 1. The court held that the administration's decision was not unreasonable or arbitrary as it was based on the administration's assessment of its requirements. 2. The court held that the petitioners did not have a fundamental right to undertake transportation/shipment of government cargo.
Final Decision: The court dismissed the writ petition.
( 1 ) THIS is an application under art. 226 of the Constitution of India by 12 (twelve) vessel owners, inter alia, challenging the circular dated July 28, 2003, issued with the approval of the competent authority, under the signature of Assistant secretary (Shipping), Andaman and Nicobar administration, permitting all M. S. class cargo vessels above 50 tons possessing valid MMO certificates to undertake transportation/ shipments of Government cargo on monthly lowest bid basis.
( 2 ) IN the writ petition the said petitioners, also, challenged all consequential notifications/tenders and allotment and acceptance of the offers of the ship owners on the basis of the said circular dated July, 28, 2003.
( 3 ) MR. Haradhan Banerjee, learned advocate, appearing in support of the writ petition, attacks the said circular and all consequential actions of the administration on three counts. Mr. Banerjee submits that the administration arbitrarily and without any bona fide reason excluded the cargo vessels below 50 tons undertaking transportation/ shipment of Government cargo on monthly lowest bid basis. He submits that such exclusion is unreasonable. All cargo vessel owners are entitled to undertake transportation/shipment of the Government cargo, but due to such exclusion of the cargo vessels below 50 tons, the owners of such vessels loose the chance to undertake transportation/shipment of Government cargo. He suggests that the aforementioned exclusion is to show undue advantage to big cargo vessel owners. Mr. Banerjee draws my attention to sub-section (j) of Section 435 (2) of the Merchant Shipping Act, 1958 and submits that only the Central Government is empowered to fix the rate of freight, which may be charged by sailing the vessels for specified goods or for any class of goods in relation to the coasting trade of India. It is suggested that the Andaman and Nicobar administration, particularly, the lieutenant governor, has no power to fix freight charges as it is within the domain of the Central government. Mr. Banerjee draws my attention on the Seventh Schedule to the Constitution of India, particularly, Item No. 89 of the union List and submits that legislation on terminal taxes on goods or passengers, carried by railway, sea or air, taxes on railway fares and freights are within the domain of the Central Government. Mr. Banerjee submits that the Central Government is following the Indian Coastal Conference Rates and, therefore, the Andaman and Nicobar administration should follow the said rates giving chances to all the vessel owners to undertake transportation/shipment of the government cargos at the said rates. Lastly, mr. Banerjee submits that the policy adopted by the Andaman and Nicobar Administration to engage private vessels to undertake transportation/shipment of Government cargo on monthly lowest bid basis creates a monopolistic position for the vessel owner, whose bid is accepted by the administration inasmuch as other vessel owners are excluded from undertaking transportation/ shipment of the Government cargo for that particular month. Mr. Banerjee in support of his contentions cited the decisions in the cases of Rashbihari Panda v. State of Orissa reported in (1969) 1 SCC 414 : (AIR 1969 sc 1081), Sachidanand Pandey v. State of west Bengal reported in (1987) 2 SCC : (AIR 1987 SC 1109), and New Horizons Ltd. v. Union of India reported in (1995) 1 SCC 478 (1995 AIR SCW 275 ).
( 4 ) THE position of Andaman and Nicobar archipelago is unique in nature. There are number of islands some of them are moderately populated, some of them are thinly populated and some of them are dense forests. The administration maintains various offices including police posts and forest guard offices because of strategic position of the islands. The Andaman and Nicobar administration are required to ship and transport various items to augment the various works and to take care of the consumption needs of the local pop
