SUBHASH R ACHARYA Vs. STATE OF MAHARASHTRA

JUDGEMENT

(1.) Rule. Respondents waive service. By consent Rule made returnable forthwith. Heard learned counsel for the parties.

(2.) By this petition under Article 226 of the Constitution of India the petitioner prays for quashing of the order dated 21st August 2004 passed by the Section Officer, Government of Maharashtra, whereby the contract for recovery of entrance fee from vehicle drivers, who enter from three check nakas of Goregaon, Powai and Marol respectively in Aarey Milk Colony has been extended for a period of 3 years with effect from 17th February 2005 by increasing the contract amount by 5% . The petitioner contends that the said order is arbitrary, discriminatory, is in colourable exercise of power, denying fair competition and the same is also entirely to the disadvantage of the State, besides causing huge loss to the public exchequer. It is averred that respondent No. 6, Minister for Dairy Development Agriculture and Animal Husbandary, acted contrary to the known canons of administration. As a result of certain controversies raised and diverse stand taken by respondent No. 6 and the State Government, the question in regard to the ambit and scope of the powers exercisable by the Minister in terms of Maharashtra Government Rules of Business, although ancillary, is a pertinent question which is required to be answered by the court. 3. In order to answer the above legal questions appropriately, a reference to basic facts would be necessary. According to the petitioner, respondent No. 1 issued notices of inviting tenders in local newspapers on 30th December 2001. The tender related to the management of three toll nakas (points) within Aarey Milk Complex, Goregaon (East) , Mumbai. Three different check posts held under this area are Marol, Powai and Goregaon. Respondent No. 1 had evolved a scheme of engaging contractors for collecting toll from vehicles passing through these toll nakas at three different rates for different categories of vehicles. The contractor is selected on the basis of the bid/tender called for that purpose. Notice inviting tenders is annexed at Exhibit A to the petition. In terms of Government Resolution No. AMC/1001/Case No 122/PDM/ 8 dated 2nd December 2001 the contract was to be awarded for a period of 3 years on the predetermined rates as approved by the Government. Respondent No.5, vide letter dated 16th February 2002, informed respondent No. 2 that his bid/tender was accepted for recovery of traffic tax at Goregaon, Marol and Powai check posts and an agreement was entered into between the parties on 16th February 2002 for a period of 3 years, which expired on 16th February 2005. Exhibit B to the petition is a copy of the said agreement executed by the parties. Certain disputes had arisen, according to the petitioner, between respondent Nos 1 and 2, which were referred to the Commissioner of Dairy Development and the same were disposed of, vide order dated - 22nd March 2002. This order was challenged in this Court by filing Writ Petition No 687 of 2002 and it was disposed of by order dated 26th April 2002. The said order reads as under: "Heard Mr. Hegde, learned counsel for the Petitioner, Petitioner, Mr. Khatito, learned Counsel for respondent No. 2 and perused the Writ Petition, the documents annexed thereto and the Affidavit in reply filed "by Respondent No. 1 as well as Respondent No. 2 and the additional Affidavits, 2. Without going into the facts of the case in detail,suffice it to say that Respondent No. 2 viz, M/s. Garib Nawaz Corporation has been awarded contract for the recovery of entry fees (toll fees) in respectof vehicles taking entry in Arey Milk Colony, Goregaon from Goregaon, Marol and Powai 'Chowk Posts. The said contract is for a period of three years. As per the said contract the Respondent No. 2 is required to pay a sum of Rs.l6.58 Crores for the contract for the period of three years and the said amount is required to be deposited by Respondent No. 2 at the rate of Rs.1,51,415/per day on Tuesday/Friday of the week in advance at the office of Chief Executive Officer, Arey, Goregaon. It appears that Respondent No. 2 committed some defaults in respect of security deposit as well as periodical deposits. Thus, the dispute arose "between the Respondent No. 2 and Chief Executive Officer, Aarey Milk Colony viz. parties to the contract and matter was referred to the Commissioner, Dairy Development (Arbitrator) . The Arbitrator in his award dated 22nd March, 2002 observed that it is necessary that amount of Rs.16.58 Crores should be paid by Respondent No. 2 herein from time to time to the Government in accordance with the terms and conditions of the period during the period of three years and if the contractor is incapable or not desirous of complying with the conditions of the contract and for the said reason the contract is cancelled. The contract should be entrusted to other person as an alternative arrangement and if the amount receivable ,by virtue of such contract is less than the amount of the present contract then the amount of loss should be recovered from Respondent No. 2 herein viz. Garib Nawaz Corporation. The Arbitrator also directed the Respondent No. 2 herein viz. M/s. Garib Nawaz Corporation to deposit the overdue amount of entrance fee upto 21st March, 2002 which is payable to the Government to the tune of Rs. 27,63,94l/alongwith penal interest and amount of entrance fee as per the contract as per daily rate on or before 30th March, 2002, failing which it would be assumed that they are not capable of continuing the contract and the contract will be cancelled as per condition No. 16 and 22 of the contract from midnight of 33.3.2002. The said order of Arbitrator has not been complied with by Respondent No. 2. as we are informed that Minister, Dairy Development has extended the time. We are unable to approve the order of Minister, Dairy Development in extending the time as such order cannot be said to have sanction of law. Besides that we are informed that the Chief Executive Officer has agreed for reduction of the contract amount to the extent of Rs. 5 Crores on the representation of the Respondent No. 2. To say the least such order of Chief Executive Officer is highly unjustified. In the matter off award of contract, if such action is upheld, it is bound to breed corruption and result in favouritism for extraneous consideration.

(3.) 'We asked the learned counsel for respondent No. 2 as to whether Respondent No. 2 is desirous of continuing with the contract as per the terms and conditions of the original contract at the rate of Rs.16.58 crores for the period of three years and periodical deposit as per the contract terms, the learned counsel for Respondent No. 2 after seeking instructions submitted that the Respondent No. 2 undertakes to abide by terms and conditions of the original contract at a contract amount of Rs.l6.58 crores for a period of three years and accordingly, shall deposit the per day amount of entry fees at the rate, of Rs.1,51,415/in advance henceforth as per the terms of the contract.