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2026 Supreme(Online)(Tel) 19869
IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD
Nagesh Bheemapaka, J
Safai Karmachari Sangam – Appellant
Versus
Telangana State Road Transport Corporation – Respondent
WRIT PETITION No. 13265 of 2023 | WRIT PETITION No. 13286 of 2024
For the Appellants/Petitioners: Ramesh Chilla
For the Respondents: N. Chandra Shekar, P. Sathish Kumar
Writ courts will not interfere in purely contractual disputes under Article 226 if an alternative dispute resolution mechanism exists and there is no violation of fundamental rights or principles of natural justice.
Headnote:(A) Constitutional Law - Writ Jurisdiction - Article 226 - Contractual disputes - When alternative remedy is provided under the contract - Held, writ court should not ordinarily interfere when grievance is purely a contractual dispute not involving violation of fundamental rights or principles of natural justice and parties are bound by the dispute resolution mechanism. (Paras 12, 14)
(B) Tender and Contractual Obligations - Policy Decisions - Interference by Court - Held, Courts should not ordinarily interfere in policy decisions or contractual terms unless there is proven mala fide or violation of legal principles. (Para 15)
Facts of the case:
The petitioner, a license holder for a toilet block, challenged a demand notice for arrears and threat of license termination issued by the transport corporation. The petitioner contended that the corporation’s policy to shift to free public toilets obligated them to pay a buyout amount, which was not done. During the proceedings, the corporation reverted to the original 'pay and use' system and reinstated the petitioner. The petitioner subsequently sought waivers and reductions of license fee arrears accumulated during the interim period.
Findings of Court:
The court observed that since the respondent corporation reverted to the 'pay and use' system and reinstated the petitioner, the request for a buyout process became infructuous. Regarding financial waivers, the court noted that the corporation had already issued a policy circular providing specific relief for the lockdown period. Additional claims for waiver fell outside the scope of writ jurisdiction and were subject to the dispute resolution mechanism prescribed in the original contract.
Issues: Whether the writ court should interfere in purely contractual disputes where an alternative dispute resolution mechanism exists and whether the petitioner is entitled to retrospective license fee waivers.
Ratio Decidendi: Writ jurisdiction under Article 226 is not appropriate for pure contractual disputes where there is no violation of fundamental rights or natural justice, especially when the agreement provides for a specific dispute resolution mechanism (Civil Suit).
Result: Writ petitions dismissed.
| Table of Content |
|---|
| 1. summary of facts and grievances regarding bot contract violations and license fee arrears. (Para 1 , 2 , 3 , 4 , 5) |
| 2. the grievance regarding buyout becomes infructuous upon restoration of the pay-and-use system. (Para 6 , 7 , 8 , 9 , 10) |
| 3. writ jurisdiction is unavailable for purely contractual disputes with alternative remedy forums. (Para 11 , 12 , 13 , 14 , 15 , 16) |
COMMON ORDER:
These writ petitions are filed by M/s Safai Karmachari Sangam, who is the license holder of Modern Toilet Block at Hanamkonda Bus Station. The grievance in both these writ petitions pertain to the action of the respondent-Telangana State Road Transport Corporation (TSRTC) in issuing a Circular whereby the contractual agreement between M/s Safai Karmachari Sangam and the TSRTC was sought to be terminated, allegedly without following the procedure contemplated under the Agreement, namely, evaluation and finalisation of the buyout amount in case of premature termination.
1.1. In view of commonality of grievance, these writ petitions were analogously heard and are being disposed of by this Common Order. For the purpose of discussion, the averments in W.P. No. 13265 of 2023 are taken as reference.
2. The case of the petitioner-M/s. Safai Karmachari Sangam, according to the affidavit in W.P. No. 13265 of 2023, are that it is the license holder of Modern Toilet Block at Hanamkonda Bus Station under Agreement 04.05.2011. He filed the present writ petition challenging the Notice dated 26.04.2023 issued by respondent No.5-Depot Manager, Warangal-I. Through the impugned notice, the petitioner was directed to pay alleged license fee arrears of approximately Rs. 6,29,778/- and action was initiated for termination of the license. The petitioner contends that the notice is arbitrary, illegal, contrary to Telangana State Road Transport Corporation (TSRTC) policies, violative of the principles of natural justice, and infringes Articles 14 and 21 of the Constitution of India.
2.1. It is stated that TSRTC, through proceedings dated 30.09.2022, decided to provide free toilet facilities at all bus stations and terminate existing toilet maintenance contracts, including BOT toilet agreements. However, the said proceedings expressly required TSRTC to first determine and pay a buyout amount to BOT licensees through a valuation process involving a committee comprising TSRTC officials and independent experts. It is alleged that TSRTC has not followed this mandatory procedure before taking steps to terminate the petitioner’s agreement.
2.2. Aggrieved by the proceedings dated 30.09.2022, the petitioner and similarly situated licensees approached this Court in W.P. No. 40803 of 2022. By order dated 10.11.2022 in I.A. No. 2 of 2022, the High Court granted an interim stay of the proceedings and all consequential actions insofar as the petitioners were concerned. Despite the subsistence of the stay order, the respondents allegedly opened free toilets in the same premises without completing the contractual buyout process, resulting in reduction in the use of the petitioner’s paid toilet facility from November 2022 onwards and causing severe financial hardship.
2.3. The petitioner further submits that, notwithstanding the stay order and the absence of any valuation or buyout determination, the respondents failed to constitute the assessment committee contemplated under the Agreement. Consequently, the petitioner was left with meagre revenue while continuing to face liability for substantial monthly license fees. To facilitate the valuation process, the petitioner submitted an independent valuation report to the concerned authorities on 05.04.2023 and also made representations to the respondents requesting to comply with the orders passed by this Court.
2.4. It is further contended that TSRTC issued Circular dated 19.04.2023 granting concessions in respect of license fees arising from the COVID-19 lockdown. The circular provided for complete waiver of license fees
