The petitioner was entitled to the remaining period of its tenure, i.e., '5+3' years, as per Clause 3.1 and Clause 5.3 of the General Conditions of license.

SURESH KAIT, J.

W.P.(C) 7095/2014

1. Vide the present petition, the petitioner seeks directions thereby directing the respondent/Indian Railways Catering and Tourism Corporation (for short ‘IRCTC’) to extend the existing catering licence of the petitioner for the operation and management of Quick Service Food Kiosk (for short ‘QSFK’) at Vijaywada Station upto 09.11.2016 in terms of Clause 3.1 of General Conditions of license as contained in the tender document.

2. Facts of the case are that the petitioner was a successful bidder in the tender floated in the year 2007 by the respondent for award of catering work for the operation and management of QSFK in question. A letter of award was issued on 26.03.2008 followed by an agreement between the petitioner No.1 and respondent/IRCTC on 05.06.2009. The said QSFK was handed over to the petitioner on "as is where is" basis without any infrastructure as is provided in Clause 3.1 of Special Conditions of the tender document. The petitioner created the requisite infrastructure and equipment at its own cost by making huge investment of about Rs.50 lakhs and commissioned the Kiosk on 10.11.2008. Clause 2.1 of the General Conditions of license provided for payment of license fee and it specifically required the bidders to quote license fee for 8 years' tenure of the license.

3. Mr. Arun Bhardwaj, learned senior counsel appearing on behalf of the petitioner submitted that petitioner had quoted a significantly higher license fee since the clear understanding between the licensees/bidders and the respondent at that stage was that the extension would be automatically granted in all cases unless some exceptional circumstances disentitle the licensee's claim for extension. The contract period was to be extended for a further period of three years as is clear from Clause 5.3 of the General Conditions of license which provided that the respondent/IRCTC shall issue a letter of award (LOA) to the selected bidder for a period of "5+3" years. Since the petitioner was entitled for extension of three years’ period under Clause 3.1, therefore, when five years period was about to come to an end on 09.11.2013, the respondent asked the petitioner for its willingness on 10.10.2013 for extension. The petitioner, accordingly, gave its willingness on 14.10.2013.

4. Mr. Bhardwaj submitted that thereafter, the Competent Authority nominated a three members' committee of GGM/DCS, GGM/infra and GGM/finance to consider renewal of petitioner's license. As per the Committee's report as obtained under Right to Information Act, 2005, the Committee invited details of complaints and inspections from GGM/SCZ, which is the concerned Railway Zone supervising the QSFK. The Committee examined all the concerns raised by the GGM/SCZ and found the petitioner's performance was satisfactory and there was no breach of the tender.

5. Further submitted that with regard to allegations of GGM/SCZ that the petitioner had not installed the Data Capturing System (DCS), the Committee found that it cannot be considered a fault on licensee's part since SCZ itself was not sure about the system to be put in place for sales capturing. The Committee also found that there was only one complaint of overcharging in 5 years which too has been condoned by imposition of fine. It also noted that there was no outstanding license fee against the petitioner, except service tax of Rs.16,068/-which was also paid by the licensee. With regard to SCZ's view that fresh tendering will increase revenue of IRCTC, the Committee's relevant observations are as under:-

"Regarding SCZ's view that fresh tendering will increase the earning of IRCTC, it may be true that with fresh tendering IRCTC may get higher revenue as compared to the presently generated from the unit. However, there could be an argument that in case IRCTC takes up tendering of this unit or for that matter any other unit after two or three years, the revenue will definitely be more than what we are expe