Cancellation of a valid contract without notice violates natural justice and constitutional rights; actions must be reasonable and lawful.

CAV JUDGMENT

Date : 20/09/2021

Heard learned senior counsel appearing for the petitioner and learned senior counsel for the Railways.

2. The petitioner has filed the instant writ application for the following reliefs:

“(i) For issuance of writ in appropriate nature for quash- ing of the letter dated, 19 March 2020, issued under the signature of Zonal Manager Eastern Central Rail- way Sonpur, whereby and where under Tender agree- ment Sonpur/w-5/1814 dated 6.11.2019 agreement number/214/STALLAGE (TAHBAZARI) Has been cancelled.

(ii) For direction to the respondent authorities to allow the petitioner for holding stallage (TAHBAZARI), as the petitioner is the highest bidder and was allotted said tender, and has deposited earnest amount but without calling any show cause, the respondent au- thority’s has cancelled the deed of agreement.

(iii) For direction to the respondent authority’s not to dis- turb in peaceful possession of the petitioner for hold- ing/ and collecting rent, as the petitioner has licensee and invested huge amount but just after few months his agreement has been cancelled.

(iv) For any other relief or reliefs for which this Hon’ble court deem fit and proper.”

3. The case of the petitioner in brief is that a ten- der notice dated 5.8.2019 was issued under the signature of the Assistant Engineer Line, Sonpur inviting candidates to partici- pate in an open tender for holding the Tahbazari fixing the date and place for open tender, for a period of two years. The peti- tioner being interested participated in the open tender and was declared the highest bidder. He was selected and directed to de- posit the earnest amount. Accordingly the petitioner deposited the earnest amount and the deed of agreement was entered into between the Railways and the petitioner. A letter dated 20.12.2019 was issued under the signature of the Assistant Zonal Engineer Line, Sonpur informing the Station Master con- cerned that the petitioner being the highest bidder with the bid amount of Rs.75,01,000/, an agreement has been entered into on 18.12.2019. Information was given to all that for the period from 1.1.2020 to 31.12.2022, the petitioner has the right for holding Tahbazari over the vacant land of the Railways as de- scribed therein in Shahpur Patoree. All concerned were directed to cooperate with the petitioner in his holding the Tahbazari over the land in question. It is the case of the petitioner that pur- suant to the direction he deposited a sum of Rs.16.30 lacs, how- ever, only a few months later a letter dated 19.32020 was issued under the signature of the Divisional Rail Manager (Engineer- ing), Sonpur, cancelling the right of Tahbazari of the petitioner, the cancellation coming in effect w.e.f. 19.2.2020. It is against this order of cancellation of holding of Tahbazari by the peti- tioner which is under challenge in this writ application.

4. It is submitted by learned senior counsel appear- ing for the petitioner that from perusal of the order impugned herein as contained in letter dated 19.3.2020 cancelling the peti- tioner’s right of holding Tahbazari, the only reason for cancella- tion of the concluded contract given there is the restriction im- posed for allotment of Tahbazari vide Railway Board letter no. 2005/LML/18 dated 10.2.2005. It is submitted that from the contents of the counter affidavit filed on behalf of the Railways it transpires that there was some complaint submitted by the vil- lagers and an enquiry was conducted by the Railways. It is sub- mitted that the petitioner was not given any information with re- spect to the complaint and the so-called enquiry was conducted behind his back. Not having found anything lacking