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High Court Of Delhi
SANJIV PRAKASH - Appellant
Versus
NEW DELHI MUNICIPAL CORPORATION - Respondent
Decided On : 03/18/1983
The Delhi High Court held that the tenderers who had successfully bid for the shops in the Palika Bazar complex were bound by the terms of the license deed and could not unilaterally vary them. The court rejected the tenderers' claim that they were entitled to the exclusive use of 12 feet of frontal space before their shops, finding that this area was meant for common use by customers. The court also rejected the tenderers' argument that the Committee had discriminated against them by insisting that they comply with the trade zoning restrictions while not insisting on this with regard to Panchkuin Road allottees, finding that the two classes of allottees were distinct and separate categories and that there was a rational difference between them.
Fact of the Case:
The case involved a dispute between the New Delhi Municipal Committee (NDMC) and several allottees of shops in the Palika Bazar complex, a shopping center in Connaught Place, New Delhi. The allottees had been granted licenses to operate shops in the complex subject to certain conditions, including a trade zoning restriction that limited the types of businesses that could be operated in each zone. The allottees challenged the validity of the trade zoning restriction, arguing that it was discriminatory and arbitrary, and that they were entitled to operate any type of business they wished. The NDMC defended the trade zoning restriction, arguing that it was necessary to maintain the overall character and ambiance of the shopping center.
Finding of the Court:
The court found that the trade zoning restriction was a valid exercise of the NDMC's authority and that it was not discriminatory or arbitrary. The court noted that the NDMC had a legitimate interest in maintaining the overall character and ambiance of the shopping center, and that the trade zoning restriction was a reasonable way to achieve this goal. The court also found that the allottees had been given adequate notice of the trade zoning restriction before they entered into their license agreements, and that they had voluntarily agreed to comply with it.
Issues: 1. Whether the trade zoning restriction was discriminatory or arbitrary. 2. Whether the allottees were entitled to the exclusive use of 12 feet of frontal space before their shops. 3. Whether the NDMC had discriminated against the allottees by insisting that they comply with the trade zoning restrictions while not insisting on this with regard to Panchkuin Road allottees.
Ratio Decidendi: 1. The court found that the trade zoning restriction was not discriminatory or arbitrary because it was a reasonable way to achieve the NDMC's legitimate goal of maintaining the overall character and ambiance of the shopping center. 2. The court found that the allottees were not entitled to the exclusive use of 12 feet of frontal space before their shops because this area was meant for common use by customers. 3. The court found that the NDMC had not discriminated against the allottees by insisting that they comply with the trade zoning restrictions while not insisting on this with regard to Panchkuin Road allottees because the two classes of allottees were distinct and separate categories and that there was a rational difference between them.
Final Decision: The court dismissed the allottees' petitions and upheld the validity of the trade zoning restriction.
( 1 ) THESE appeals relate to the matter or allotment to the prestigeous und. erground shopping complex known as Palika Bazar which was built in Connaught Place by the respondent Committee in the year 1976. This shopping Centre was designed to accommodate 308 shops of various sizes located at diff rent levels. The whole complex is a centrally air-conditioned one. The Committee by its resolution of 29-11-1977 had approved a policy matter to allot 98 shops to the shopkeepers of Panchkuin Road because that space was required for widening of thi; said Road. The Government had also taken a policy decision that the following categories of shopkeepers who had. been carryin go ntheir business elsewhere will be accommodated first. These categories were Panchkuin Road 98, Janpath Stalls-71, Tibetan Stalls-24 and Connaught Circus (Yusuf zai Market)- 117. The Government also decided as per communication of 27-4-1978 that out of these above shopkeepers who wished to leave their present shops and desired to obtain shops in underground shopping centre may be allowed to come. But others who did not wish may not be forced to come ; the remaining shops be let out On tender.
( 2 ) ON 27-5-1978 the Delhi Administration directed the Committee to allot 98 stall holders of Panchkuin Road Shops in this complex on the conditions which had already been settled. As ail the stalls reserved for Tibetans were not taken by them the result was that there was large number cf stalls still available, that is why a policy decision was taken by the Committee to call for tenders for allotment of 177 shops divided into 4 zones and further classsfied in 7 groups tor proper identification as detailed below: (a) General Shop , (b) Shops with 12 front space; (c) Shops with water connection; (d) Shops with water connection and 12 front space; (e) Shops with additional height; (f) Shops with loft; and (d) Shops with water connection and 12 front space;
THE Committee issued licenses to certain stall holders of Panchkuin Road in view of their surrendering the shaps and utilised the land under their stalls at Panchkuin Road for publicconvenience. The licence fee was fixed by the Committee. . It is II common case that it was much lower than that for which tenders were offered by the appellant and ultimately accepted by the Committee. The Committee had also evolved a scheme of trade zoning restriction by which only some trades were permitted in each zone. It is also comon case that this trade zoning restriction was not made applicable to the shopkeepers of Panchkuin Road. In due course the tenders for 177 shops were issued.
( 3 ) SEPARATE tenders were to be submitted for a shop in each group. The preference for allotment of a particular shop in a group was to be given to the highest tenderer in descending order; only tenders above reserve price being considered, In the terms and conditions of the tender clause 10 mentioned that only such trades as mentioned in the trade zoning plan shall be permitted to be run in the shop. The details of the trade zoning plans were appended alongwith the documents. The appendix A shows that the area was divided into zones 1a, 1b and zone 2, 3, and 4. The licensee was to pay the licence fee in advance by 10th of each calender month. Non-payment of licence fee will constitute a breach of the terms of the license. Similarly if the licensee tails to perform or observe any of the terms and conditions to be observed the licensor may without prejudice to general right of reolution of licence re-enter the premises in question. Appellant in LPA 12211981 had iven a tender at Rs. 60. 28 per sq. ft. The license fee of which works out to Rs. 9367. 31 per moiilh. The respondents had given tender TOT a shop wiih 12 feet frontage and had indicated the trade to be run by him as Boutique. In due course he was allo tted shop No. 3 in Zone 3. as per allotment letter dated 28-10-1978 issued by the Committee. The trade permissible in the shop was Bout
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