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2025 Supreme(Mad) 5397
IN THE HIGH COURT OF JUDICATURE AT MADRAS
M.DHANDAPANI, J.
PVR INOX Ltd., Rep. by its Authorised Signatory Mr. Ayappan K- Petitioner
Versus
Airports Authority of India Rajiv Gandhi Bhawan Safdarjung Airport – Respondent
W.P. NOS. 22968 & 23060 OF 2025 AND W.M.P. NOS. 25805, 25806, 25808, 25904, 25906, 25907 & 30459 OF 2025
Decided On : 09-12-2025
For the Petitioner: Mr. P.S. Raman, SC, for M/s. Arva Merchant, Mr. Sathish Parasaran, SC, for M/s. Arva Merchant
For Respondent: Mr. AR.L. Sundaresan, ASG Assisted by Mr. Ramaswamy Meyyappan, Mr. Abhishek Jenasenan
The functioning of a cinema multiplex within the airport premises is permissible as there is no explicit prohibition under the AAI Act; discretion lies with the authority to grant permission.
Headnote:(A) Airports Authority of India Act, 1994 - Section 12 - Writ petition for certiorarified mandamus challenging closure of cinema multiplex - Petitioners granted sub-license for multiplex operations at Chennai Airport - Closure directed by Airports Authority citing non-permissibility under AAI Act - No express prohibition for the running of cinema multiplex observed, thus, holding the authority has discretion to permit operational activities that serve commercial interests- The court directs the 1st respondent to present the policy on cinema multiplex operations to the Government within four weeks. (Paras 1-174)
(B) Promissory Estoppel - Applicability against Government - Found applicable in public contracts - Past representations made by public bodies should be honored when substantive reliance exists. (Paras 44-46)
Facts of the case:
The petitioner, having invested significantly in establishing a multiplex following approvals from relevant authorities, faced an order of closure issued by the Airports Authority of India, claiming operation wasn't permissible under the AAI Act, leading to writ petitions being filed.
Findings of Court:
The multiplex is not defined as an airport under the AAI Act's definitions. The rejection of multiplex operations denies the petitioner the right to continue a commercial endeavor without express legal basis, hence requiring further governmental policy consideration.
Issues: Main issues revolved around the interpretation of permissibility under the AAI Act for cinema multiplexes in airport premises, privity of contract between parties, and the applicability of promissory estoppel.
Ratio Decidendi: While operational restrictions by the authority are permissible under the AAI Act, the lack of express prohibition allows discretion. The government should decide on current operational policies regarding multiplex cinema in airports, considering commercial viability and past practices.
Result: Writ petitions directed for consideration of multiplex operation policy by the government; status quo maintained pending decision.
| Table of Content |
|---|
| 1. formation and operation of mlcp complex at chennai airport. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10) |
| 2. approval and granting of licenses related to multiplex and operational issues. (Para 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19 , 20) |
| 3. direction for policy decision on operation of multiplex. (Para 174) |
ORDER :
M.DHANDAPANI, J.
Aggrieved by the impugned letter in and by which the 1st respondent had called upon the petitioner for closure of its lawful operation of its multiplex in the Multi-Level Car Parking Complex (for short ‘MLCP’) at Chennai Airport, the present writ petitions have been filed.
2. The formation of a MLCP Complex in the Chennai Airport was conceived, developed and executed in which various activities, including a multiplex containing a cinema hall was sought to be developed, which was approved by resulting in the construction of a cinema hall, which had the approval of the 1st respondent on the basis of the Development Agreement dated 20.6.2018 entered into with the 2nd respondent. However, later in point of the 1st respondent vide its impugned letter had taken a position that the operation of a cinema hall cannot be given effect to as the said operation is not a permissible activity under the Airports Authority of India Act , 1994 (for short ‘AAI Act’), which according to the petitioner is in clear derogation of the 1st respondent’s contractual obligations and also the directions passed by this Court ordering maintenance of status quo. Further, the writ is maintainable as it does not arise from any private contractual dispute, nor is it contingent upon the enforcement of rights under the Development Agreement between the 1st and 2nd respondents; rather the gravamen of the challenge lies in the arbitrariness and unconstitutionality of the conduct of the 1st respondent, which is in violation of Articles 14 and 19 (1) (g) of the Constitution, as the said act of running a cinema hall has been expressly permitted by the 1st respondent and that it is not an isolated act, but a consistent affirmative conduct by the 1st respondent giving rise to a legitimate expectation showcasing that the petitioner would be entitled to operate the cinema halls lawfully and the sudden issuance of the impugned letter is not only in breach of the petitioner’s legitimate expectation, but it against the doctrine of promissory estoppel.
3. The case of the petitioners as averred before this Court is as under :-
Request for Proposal (for short ‘RFP’) along with Notice Inviting Tender (for short ‘NIT’) was issued inviting bids for the development of a MLCP facility on Design, Build, Operate and Maintain basis (for short ‘DBOM’) with integrated commercial infrastructure at the Chennai Airport. The project was not merely confined to creation of a structured parking facility, but was also planned to include commercial complex within the car parking blocks so as to elevate the overall passenger experience to international standards. In the RFP, the list of permissible activities was expansively given, more particularly in relation to passenger amenities and prohibited activities did not attract cinema halls.
4. Pursuant to the NIT, on the 2nd respondent coming out successful, Development Agreement was duly executed between the 1st respondent and the 2nd respondent. Under the terms of the said Development Agreement, the 2nd respondent was granted comprehensive rights to design, construct, operate and maintain the MLCP facility with integrated commercial space with the premises of the Chennai Airport on a construction-cum-license to operate and maintain basis for the contractual term. The Development Agreement specifically envisaged the entitled of the 2nd respondent to develop and carry out commercial activities within the MLCP complex as part of the integrated commercial development, which constituted an essential and inseparable element of the project design. The contract period of the said Development Agreement was for a p
