- 1 - IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO.516 OF 2008 1. Mr.Dilip Ranadive, ) 2. M/s.Ranadive, ) a registered Partnership ) firm, both Petitioners ) No.1 and 2 have their ) office at D-21, Balgovind ) Society, Takalwadi Road, ) Mahim, Mumbai-400 016. ).. Petitioners Versus 1. Union of India, ) through its Secretary, ) Ministry of Civil Aviation ) Rajiv Gandhi Bhavan, ) Safdarjung Airport, ) New Delhi - 110 003. ) 2. Airports Authority of India) through its Chairman, ) Ministry of Civil Aviation ) Rajiv Gandhi Bhavan, ) Safdarjung Airport, ) New Delhi - 110 003. ) 3. Mumbai International Airport Private Limited, ) Chhatrapati Shivaji ) International Airport, ) 1st Floor, Terminal ) Santacruz (East), ) Mumbai - 400 099. ) 4. Director General of Civil ) Aviation, Office of the ) Regional Director, ) Western Region, ) Old Airport, Kalina, ) Mumbai - 400 099. ) 5. Bureau of Civil Aviation ) Security, Regional Deputy ) Commissioner of Security, ) - 2 - Western Region, D/2/2, ) AAI Residential Colony, Andheri Sahar Road, ) Mumbai - 400 099. ).. Respondents -- S/Shri Aspi Chinoy, Senior Counsel with Milind Sathe, Senior Advocate with S.C.Gupte i/b A.S.Dayal & Associates for the Petitioners. S/Shri D.A.Athawale with N.R.Prajapati, advocates for the Respondent Nos.1 and 4. Shri Pradeep Rajgopal with Mrs.Rekha Raggopal for Respondent No.2. S/Shri Virag Tulzapurkar, Senior Counsel with Farid Karandiwala and Bhavik Manek, advocate i/b Wadia Ghandy & Co. for the Respondent No.3. -- CORAM : SRI R.M.S.KHANDEPARKAR & SRI A.A.SAYED, JJ DATED : 14TH AUGUST, 2008 JUDGMENT : ( Per Sri R.M.S.Khandeparkar, J ) JUDGMENT : ( Per Sri R.M.S.Khandeparkar, J ) JUDGMENT : ( Per Sri R.M.S.Khandeparkar, J ) 1. Heard. Rule. By consent, the rule is made returnable forthwith. The advocates for the Respondents waive service. 2. By the present petition, the petitioners are seeking a declaration to the effect that the Expression Of Interest dated 3rd January, 2008, hereinafter called as "EOI" to be without authority of law and hence ultra vires, and for various - 3 - consequential reliefs. 3. The grievance of the petitioners relates to the EOI issued by the Respondent No.3 for inviting bidders for ground handling work at the Mumbai Airport. It is the case of the petitioners that the said EOI and the norms prescribed thereunder are manifestly unreasonable and arbitrary and are designed and aimed at eliminating Indian agencies engaged or desiring to engage in ground handling work, besides being that the said EOI is contrary to the statutory provisions of Airports Authority of India Act, 1994, hereinafter called as "the said Act". It is the case of the petitioners that the said EOI is tailor made for some pre-selected persons and in the process the persons like the petitioners who are in the business of ground handling since 1979 face imminent threat of elimination from their legitimate business. 4. The petitioners are in the business of ground handling for Gulf Air, Air France, Delta, Northwest Airlines, etc. at Mumbai Airport, and the Petitioner No.2 is a registered partnership firm carrying on the said business of ground handling at Mumbai Airport. The Respondent No.2 has been constituted under the said Act and the undertakings of International - 4 - Airports Authority of India have been transferred to and vested in the Respondent No.1 for the purpose of the said Act and by virtue of Section 13(2) of the said Act, the undertaking of the erstwhile International Airports Authority of India was transferred and vested in the Respondent No.2. The Respondent Nos.3 to 5 discharge certain functions entrusted to them either under the said Act or under the Aircraft Act, 1934 or by virtue of delegation of powers in that regard. 5. The Respondent No.3 is a company, registered under the Companies Act, 1956 and is a consortium of GVK Airport Holdings Pvt. Ltd. ACSA Global Limited, Bid Services Division (Mauritius) Ltd. and the Respondent No.3 is created with the objective of operating maintaining, developing, designing, constructing, upgrading, modernizing, financing and managing Airports. It is the lessee in terms of the Lease Agreement by the Respondent No.2. 6. The Respondent Nos.1 and 2 statutorily oversee and/or are in ultimate control of all airports, including the Mumbai Airport. The Respondent No.4 is a statutory authority under the Aircraft Act, 1934 and the Respondent No.5 is a regulatory authority for - 5 - security measures for civil aviation in India. 7. The Respondent No.2 in exercise of powers vested under the said Act entered into an Agreement with the Respondent No.3 in respect of certain activities to be conducted and/or undertaken in respect of Mumbai Airport. 8. It is the case of the petitioners that prior to 1982, ground handling work at Indian Airports was regulated by an order dated 18th January, 1972 issued by Respondent No.5. The International Airport Authority of India framed regulations in the year 1982 which was notified on 25th March, 1982 and were called "The International Airports Authority of India (General Management, Ground Handling of Air Transport Services ) Regulations, 1982. In terms of the said notification, it is further case of the petitioners that in the year 1982, the ground handling work at Mumbai Airport was being done by Cambata Aviation, the petitioners, IAAI, Self Handling and Air India and Indian Airlines. However, at present there are about 50 other operators at Mumbai Airport doing ground handling work and that too without being authorised to do so. - 6 - 9. A notification dated 5th June, 1984 came to be issued by the International Airport Authority of India, the predecessor of the respondent No.2 whereby it sought to bar the work of ground handling done by a ground handling agencies prior to the coming into force of said notification, and the letter dated 16th October, 1984 came to be issued for surrender of all the airport entry passes. Aggrieved by the same, the petitioners filed Writ Petition No.2277 of 1984 challenging the action on the part of the International Airport Authority of India. By an order dated 13th April, 1984 passed in the said Writ Petition, the said Regulations dated 5th June, 1984 so far as it related to regulation 5(c) and its explanation restricted the petitioners from carrying out ground handling work was set aside. 10. Sometime in 1989, the National Airports Authority of India was created under the National Airports Authority Act, 1985 and the Regulations made thereby were notified on 24th May, 1989 and they were called "The National Airports Authority (General Management, Entry for Ground Handling for Airport Transport Services) Regulations, 1989. 11. In the year 1993, with the opening of air - 7 - traffic to the private airlines, Jet Airways awarded the work of providing ground handling services to the petitioners. The petitioners’ request for additional passes to provide ground handling services to Jet Airways was arbitrarily rejected by the respondent No.2. A contempt petition came to be filed against the respondent No.2 in the year 1996 on account of certain interpretation sought to be given to clause 5 of the 1984 Regulations. However, pursuant to the explanation submitted and apology tendered, the matter was not carried any further. 12. The respondent No.2, under the notification dated 17th January, 2000 and pursuant to the Ground Handling Regulations, 2000, invited tenders for providing ground handling services at various airports including Mumbai. However, the entire process was sought to be scrapped in the year 2003. 13. Sometime in April, 2006, the respondent No.2 entered into an agreement with the respondent No.3 whereby some of the functions of the respondent No.2 in relation to the Mumbai Airport were agreed to be performed by the respondent No.3. 14. On 28th September, 2007, the Director General - 8 - of Civil Aviation issued a circular for information, guidance and compliance under the caption "Grant of Permission for providing Ground Handling Services at Airports other than those belonging to the Airports Authority of India." On 18th October, 2007, the respondent No.2 issued a notification under Section 42 of the said Act framing Airports Authority of India (General Management Entry for Ground Handling of Airport Transportation Services) Regulation, 2007. Copies of the said circular and the regulations are found to have been placed on record as Exhibit-"L" and Exhibit-"M", respectively. On 3rd January, 2008, the respondent No.3 issued the said EOI, i.e. Expression of Interest for Concession for Third Party ground handling at Chhatrapati Shivaji International Airport, Mumbai. 15. The challenge to EOI is four-fold, namely, that the EOI is ultra vires the statutory regulations dated 18th October, 2007; secondly, the terms and conditions mentioned in the said EOI are arbitrary, discriminatory and bad in law; thirdly, the respondent No.3 is a State or other authority within the meaning of the said expression under Article 12 of the Constitution of India and, therefore, is amenable to the writ jurisdiction of this Court; and fourthly - 9 - that the respondent No.3 performs statutory functions and, therefore, is amenable to the writ jurisdiction of this Court. 16. It is the case of the petitioners that the circular dated 28th September, 2007 read with the notification dated 18th October, 2007 makes it absolutely clear that function of regulating the ground handling work is vested in the respondent No.2 and the respondent No.2 continues to exercise its powers for carrying out the aforesaid functions and hence despite the agreement dated 4th April, 2006 entered into between the respondent No.2 and the respondent No.3 for maintenance and operation of the Mumbai Airport, the responsibilities for regulating ground handling work was retained by the respondent No.2 itself and no powers in respect thereof are exercisable by respondent No.3, and hence the EOI is without jurisdiction, bad in law and ultra vires. 17. It is the contention on behalf of the Petitioners that the circular dated 28th September, 2007 makes it abundantly clear that it is for the Central Government to decide the agencies who can provide ground handling services at the Airports and to lay down eligibility criteria for such ground - 10 - handling agencies. The attention is sought to be drawn to Clause Nos.1.3, 1.4, 2 and 7 of the said circular in that regard. It is further sought to be contended that the circular makes it clear that the Airport Operator is an authority to undertake to selection process and stipulates performance standard for such selection and only pursuant to the function delegated to it in that regard by the Government of India. It is, therefore, the contention on behalf of the petitioners that the respondent No.3 exercises the powers and functions of the Central Government and acts as an instrumentality and agency of the Government in that regard. Reliance is placed in the decision of the Apex Court in Andi Mukta Sadguru Shree Andi Mukta Sadguru Shree Andi Mukta Sadguru Shree Muktajee Vandas Swami Suvarna Jayanti Mahotsav Smarak Muktajee Vandas Swami Suvarna Jayanti Mahotsav Smarak Muktajee Vandas Swami Suvarna Jayanti Mahotsav Smarak Trust & Others v. V.R.Rudani & Others, Trust & Others v. V.R.Rudani & Others, Trust & Others v. V.R.Rudani & Others, reported in (1989)2 SCC 691, Pradeep Kumar Biswas v. Indian Pradeep Kumar Biswas v. Indian Pradeep Kumar Biswas v. Indian Institute of Chemical Biology & Others, Institute of Chemical Biology & Others, Institute of Chemical Biology & Others, reported in (2002)5 SCC 111, Directorate of Education & Ors. v. Directorate of Education & Ors. v. Directorate of Education & Ors. v. Educomp Datamatics Ltd. & Ors., Educomp Datamatics Ltd. & Ors., Educomp Datamatics Ltd. & Ors., reported in (2004)4 SCC 19, and Association of Registration Plates v. Association of Registration Plates v. Association of Registration Plates v. Union of India & Ors., Union of India & Ors., Union of India & Ors., reported in (2004)5 SCC 364. 18. As regards the last two grounds of challenge in the petition are concerned, undisputedly, the point in that regard was specifically decided by the - 11 - Division Bench of this Court in Writ Petition No.617 of 2007 in the judgment delivered on 5th June, 2008. At the same time, undisputedly, it is also a matter of record that the operation of the said judgment has been stayed by the Apex Court in SLP No.15984 of 2008 by an order dated 4th August, 2008, and the matter is listed for hearing in the month of November, 2008 before the Apex Court. Since the Apex Court is already seized with the matter in that regard, it will be appropriate to leave those issues open in this matter and to ascertain whether the matter can be considered independently of the said issues. 19. It is the contention on behalf of the petitioners that the Regulations of 18th October, 2007 are issued under Section 42 of the said Act and the Clause 3 of the Regulations specifically deals with the commercial and ground handling services at Metropolitan Airport at Mumbai. It clearly provides that the service provider shall be selected by the respondent No.3 through competitive bidding on revenue sharing basis and the respondent No.3 shall lay down the terms and conditions including the financial consideration, eligibility criteria, both financial and technical, number of agencies to be appointed at each of the airports. Since the statutory regulations - 12 - expressly cover selection process for ground handling agency in Mumbai at metropolitan airport, the respondent No.3 could not lay down the eligibility criteria of terms and conditions contrary to those provisions and, therefore, the EOI which purports to do so is ex facie ultra vires the said regulations. 20. The respondent No.3, on the other hand, has submitted that the circular and the regulations operate in separate fields and deal with separate subject matter, and both are to be harmoniously construed to ascertain as to what each of them provide for. According to the respondents, subject matter of circular is the ground handling at the airports other than the airports managed by the respondent No.2 while the subject matter of the regulations is ground handling at the airport managed by the Respondent No.2. The power to issue circular lies under the Aircraft Act, 1934 and the rules framed thereunder. The author of the said circular is the respondent No.4. The attention is sought to be drawn in that regard to the circular as well as the regulations while contending that the same ex facie discloses separate fields in which each of them operates, further contending that a distinction between the airports managed by the respondent No.2 and those not - 13 - managed by the respondent No.2 is clearly brought out in clause 1.3 of the circular. It is their further contention that the 2007 Regulations expressly supersedes over the Ground Handling Regulations 2000 and do not refer to the circular, nor it supersedes the circular and, therefore, 2007 Regulations do not apply to the airports which are not managed by the respondent No.2, including the Mumbai Airport. 21. If one peruses the circular dated 28th September, 2007, it is clearly revealed on the face of the said circular that it relates to the subject of "Grant of Permission for providing Ground Handling Services at Airports other than those belonging to the Airports Authority of India." The clause 1.3 of the circular provides that the Airports Authority of India (General Management, Entry for Ground Handling Services) Regulations, 2000, have been made under Section 42 of the Airports Authority of Indian Act, 1994 and thus are applicable to the airports managed by the Airports Authority of India. With the restructuring of certain airports and development of a few Greenfield airports in the private sector, it has become imperative for the Central Government to lay down the eligibility criteria for various agencies to undertake ground handling services at non-AAI - 14 - airports. The number of such agencies to be permitted at each airport is also to be determined by the Government having regard to all the relevant factors such as demand for such services, available infrastructure and competitive environment, without compromising the safety and security aspects. 22. The Clause 1.4 of the said circular provides that "Rule 92 of the Aircraft Rules, 1937 provides that the licensed public aerodromes shall, while providing ground handling services themselves, ensure a competitive environment and allow the ground handling service providers permitted by the Central Government to provide ground handling services at such aerodromes without any restriction. These ground handling service providers shall, however, be subject to security clearance of the Central Government. As such, it is for the Central Government to decide the agencies who can provide ground handling services at various aerodromes and also the eligibility criteria for such service providers." 23. The Clause 2 of the said circular relates to the eligibility criteria for ground handling service providers and it states that while the Airports Authority of India would promulgate the necessary - 15 - regulations, with the previous approval of the Central Government, under the Airports Authority of India Act, 1994, with respect to provision of ground handling services at the airports under their control, it has been decided by the Central Government that with immediate effect, the entities enumerated therein shall be eligible to undertake ground handling services at airports other than those belonging to the Airports Authority of India. The entities which are specified therein in Sub-clause (A) relating to the various Metropolitan Airports including the one located at Mumbai are; (i) the airport operator itself or its Joint Venture partner; (ii) subsidiary companies of the national carrier i.e. National Aviation Company of India Ltd. or their joint ventures specialized in ground handling services. Third party handling may also be permitted to these subsidiaries or their joint ventures on the basis of revenue sharing with airport operator subject to satisfactory observance of performance standards as may be mutually acceptable to the airport operator and these companies and; (iii) any other ground handling service providers selected through competitive bidding on revenue sharing basis by the airport operator subject to security clearance by the Government and observance of performance standards as may be laid - 16 - down by the airport operator. The clause (B) relates to all other airports and it specifies that "in addition to the entities mentioned above, the airline operators shall also be permitted to undertake self-handling. However, foreign airlines shall not be allowed to engage themselves in self-handling." 24. The circular, therefore, on the face of it discloses that it relates to the subject of grant of permission for providing ground handling services at all airports other than those belonging to Airports Authority of India. In other words, the airports which belong to Airports Authority of India, the circular will have no application. The circular further clarifies that there are already regulations made dealing with the subject of ground handling services in relation to the airports managed by the airport authority of India and, therefore, in the absence of those regulations being applicable to the other airports which have been developed in public sector, it was found necessary under Central Government to lay down eligibility criteria for such agencies to undertake ground handling services and, therefore, the said circular came to be issued. 25. The Regulations of 2007 dated 18th October, - 17 - 2007 clearly specify that "they shall apply to all airports and civil enclaves managed by the Airports Authority of India, provided that they shall not apply to defence installations or enclaves or enclosures at the airports." In other words, the Regulations of 2007 published on 18th October, 2007 on the subject of ground handling services at the airports clearly restrict its applicability to those airports which are managed by the Airports Authority of India. The regulations under Clause 5 thereof specify that the airports authority in India constituted under Sub-section (1) of Section 3 of the said Act shall lay down the terms and conditions (including financial consideration), eligibility criteria for ground handling agency (both financial and technical) and number of such agencies to be appointed at each airport keeping in view the safety security, demand, available infrastructure, land and other relevant consideration. The clause 6 thereof provides that Bureau of Civil Aviation Security may impose such restrictions as may be necessary in this behalf on grounds of security, and Clause 7 thereof provides that as specified in Regulation 3 shall be required to follow the instructions issued by the Bureau of Civil Aviation Security as contained in Annexure "A" to the said regulations or as may be altered or substituted - 18 - or modified or amended from time to time. The clause 8 requires due compliance of the provisions contained in the Aircraft Act, 1934 and rules made thereunder. The agencies which are specified in the Regulation 3 are similar to the agencies specified in Clause 2(A) of the Circular dated 28th September, 2008. The Clause 3 of the Regulation reads thus:- "3. Ground handling services at airport - (1) A carrier may carry out ground handling services at metropolitan airports, that is, the airports located at Delhi Mumbai, Chennai, Kolkata, Bangalore and Hyderabad, by engaging the service of any of the following, namely:- (i) Airports Authority of India or its Joint Venture Company; (ii) subsidiary companies of the national carrier, that is, National Aviation Company of India Limited or its joint ventures specialized in ground handling services: . Provided that third party handling may be permitted to these - 19 - subsidiaries or their Joint Ventures on the basis of revenue sharing with the Authority subject to satisfactory observance of performance standards as may be mutually acceptable to the Authority and these companies; (iii) any other ground handling service provider selected through competitive bidding on revenue sharing basis, subject to security clearance by the Central Government and observance of performance standards." 26. It is not in dispute and cannot be in dispute that it is for the respondent No.2 to lay down the terms and conditions including financial consideration, eligibility criteria for ground handling agencies, both financial and technical, number of such agencies to be appointed at each of the airports keeping in view the safety security, demand, available infrastructure, land and other relevant consideration as has been specified under Clause 5 of the said Regulations. 27. Being so, the respondents are justified in - 20 - contending that the grievance of the petitioners that the regulations issued on 18th October, 2007 override or supersede the circular dated 28th September, 2007 is devoid of substance. The regulations specifically relates to the airports managed by the Airport Authority of India whereas the circular applies to all the airports other than belonging to the Airport Authority of India, and hence there is no question of one superseding the another and both are to be read harmoniously. In this regard, the stand of the respondent No.1 which is also clear to the effect that the regulation does not supersede circular and that therefore the EOI cannot be said to be ultra vires. The same is the stand of the respondent No.2 in their affidavit where it has been stated that the circular dated 28th September, 2007 is an independent of the regulations of 2000 and, therefore, there is no question of supersession of the circular by the Regulations. 28. As rightly submitted on behalf of the respondents, a statutory provision has to be understood in the context in which it appears in the statute. The same rule will apply in relation to the subsidiary or delegated legislation. A provision of law in its statute or in the rules and regulations - 21 - made thereunder cannot be read in isolation and ignoring the scheme of the concerned statute and the regulations made thereunder and no such provision can be interpreted to render the same meaningless or otiose, rather interpretation, if any, required the same should be with a view