*THE HON'BLE SRI JUSTICE C.V.NAGARJUNA REDDY +W.P.Nos.11463, 19520, 19732, 20487 and 21758 of 2010 Date : 15-04-2011 + W.P.No.11463/2010 # S.Pandu Ranga Reddy .. Petitioner Vs. $ The Government of Andhra Pradesh, Represented by its Commissioner & Director of Agricultural Marketing, BRKR Buildings, Tankbund, Hyderabad and others ..Respondents ! Counsel for the petitioners : W.P.Nos.11463/2010 & 19732/2010) : Sri S.Satyam Reddy W.P.No.20487/2010) : Sri Vijay Kumar Heroor W.P.No.19520/2010) : Sri D.Jagan Mohan Reddy W.P.No.21758/2010) : Sri O.Manohar Reddy ^ Counsel for the respondents : W.P.Nos.11463/2010, 19732/2010 : G.P. for Agriculture for R.1, R.3 Sri K.Upender Reddy, Standing Counsel for R.2 Sri P.Gangaiah Naidu, Senior Counsel for R.4 W.P.No.19520/2010 : G.P. for Agriculture for R.1 & R.2 Sri K.Upender Reddy, Standing Counsel for R.3 & R.4 Sri P.Gangaiah Naidu, Senior Counsel for R.5 W.P.No.20487/2010: G.P. for Agriculture for R.1 & R.2 : Sri K.Upender Reddy, Standing Counsel for R.3 : Sri P.Gangaiah Naidu, Senior Counsel for R.4 W.P.No.21758/2010 : G.P. for Agriculture for R.1 & R.2 Sri K.Upender Reddy, Standing Counsel for R.3 & 4 Sri P.Gangaiah Naidu, Senior Counsel for R.5 <GIST: >HEAD NOTE: ? CASES REFERRED : 1. 1987(2) SCC 295 2. 1995 Supp.(2) SCC 512 3. 1979(3) SCC 489 4. 1985(3) SCC 267 5. 2000(8) SCC 262 6. 1980(4) SCC 1 7. 2009(3) Supreme 429 8. 2009(7) SCC 561 9. (1998) 8 SCC 1 10. (2003) 2 SCC 107 THE HON'BLE SRI JUSTICE C.V.NAGARJUNA REDDY W.P.Nos.11463, 19520, 19732, 20487 and 21758 of 2010 Date : 15-04-2011 W.P.No.11463/2010 Between : S.Pandu Ranga Reddy .. Petitioner And The Government of Andhra Pradesh, Represented by its Commissioner & Director of Agricultural Marketing, BRKR Buildings, Tankbund, Hyderabad and others ..Respondents Counsel for the parties : Petitioners : W.P.Nos.11463/2010 & 19732/2010) : Sri S.Satyam Reddy W.P.No.20487/2010) : Sri Vijay Kumar Heroor W.P.No.19520/2010) : Sri D.Jagan Mohan Reddy W.P.No.21758/2010) : Sri O.Manohar Reddy Respondents W.P.Nos.11463/2010, 19732/2010 : G.P. for Agriculture for R.1, R.3 Sri K.Upender Reddy, Standing Counsel for R.2 Sri P.Gangaiah Naidu, Senior Counsel for R.4 W.P.No.19520/2010 : G.P. for Agriculture for R.1 & R.2 Sri K.Upender Reddy, Standing Counsel for R.3 & R.4 Sri P.Gangaiah Naidu, Senior Counsel for R.5 W.P.No.20487/2010: G.P. for Agriculture for R.1 & R.2 : Sri K.Upender Reddy, Standing Counsel for R.3 : Sri P.Gangaiah Naidu, Senior Counsel for R.4 W.P.No.21758/2010 : G.P. for Agriculture for R.1 & R.2 Sri K.Upender Reddy, Standing Counsel for R.3 & 4 Sri P.Gangaiah Naidu, Senior Counsel for R.5 The court made the following : COMMON JUDGEMENT: In these five Writ Petitions, the decision of respondent Nos.2 and 3 in allotting space for running electronic weigh bridge in favour of one Amit Kumar Agarwal s/o.Lakshminarayan Agarwal, is challenged. Though the petitioners in each of these Writ Petitions are different, as the respondents and the subject matter of the dispute are common, they are heard and being disposed of together. For convenience, the respondents are referred as they are arrayed in W.P.No.19520/2010. The background leading to the filing of these Writ Petitions is briefly summarized as under: Respondent No.3-The Agricultural Market Committee, Gaddiannaram, (for short “the Market Committee) which was an unit of Agricultural Market Committee, Hyderabad, constituted under the provisions of A.P. (Agricultural Produce and Livestock) Markets Act 1996 (for short, "the Act"), was formed as a separate market committee with effect from 1-1-2006. L.B. Nagar vegetable market is under the administrative control of the Market Committee. Various varieties of fruits such as mangoes, sweet lime, oranges, bananas, pomegranates, apples etc., are brought in large scale into this market whose jurisdiction covers Saroornagar, Hayathnagar, Uppal and Ghatkesar Mandals of Ranga Reddy District. From the note circulated by the Market Committee, it is revealed that there are 243 commission agents and 228 traders in the said market. When the Market Committee was part of the Hyderabad Market Committee, respondent No.2 issued a public notice published in the Press on 22-1-1992 inviting applications from the educated unemployed persons who have passed Intermediate for allotment of site in as many as 33 market yards for installation of weigh bridges at their own cost. Hyderabad was one such market yard included in the said notice. The petitioner in W.P.No.11463/2010 who applied in pursuance of the said notice was selected for allotment of site at Gaddiannaram and open space admeasuring 216 sq. yards at the entrance of the market yard was allotted in his favour on lease for a period of 30 years. Accordingly, the said person has established the weigh bridge in the name and style of Sri Venkateshwara Weigh Bridge. In the year 2005, the said person was asked to shift the weigh bridge from the front side to the backside of the market yard on the ground of traffic congestion. Though he initially protested, on the insistence of the Market Committee, he has shifted the weigh bridge to the rear side of the market yard in the year 2006 and has been carrying on his business at the shifted place. As things stood thus, proposals appear to have been mooted by the Market Committee for establishment of a second electronic weigh bridge. In its General Body Meeting held on 7-8-2009 at 3 p.m., the Market Committee, after purportedly considering all the six applications, resolved to allot the site to one Amit Kumar Agarwal, respondent No.5. However, the Chairman has disagreed with the said resolution and gave his dissenting note to the effect that applications from the unemployed persons who passed 10th Class and in particular the physically challenged who do not have their own house or house site shall be invited through Press publication and the site be allotted in favour of the eligible persons. He has further opined that people coming from the other States and have been working as commission agents or their family members shall not be allotted the site under any circumstances. Obviously, on coming to know about the said resolution, the petitioners started making representations to respondent No.2 and the Market Committee. The petitioner in W.P.No.21758/2010 filed W.P.No.19185/2008 for a mandamus to declare rejection of his application by the Market Committee for allotting site for running the weigh bridge as illegal. This court by order dated 29-12-2009 while disposing of the said Writ Petition directed the respondents to give preference to the petitioner in allotment of the site for running the weigh bridge. He submitted his representations dated 27-1-2010 and 29-1- 2010 to the respondents for allotment of site in his favour. Similarly, the petitioner in W.P.No.19520/2010 submitted its representation dated 12- 1-2010 to the Hon’ble Minister for Marketing and Wearhousing, Government of Andhra Pradesh, wherein it has stated that they have come to know from reliable sources that there was a proposal for installation of another electronic weigh bridge and that no publicity was given inviting applications for allotment of land on a competitive basis. It has inter alia offered to weigh all incoming lorries, trollies and other vehicles belonging to growers/sellers without charging any fee and has quoted Rs.25/- for heavy vehicles and Rs.15/- for trollies and autos. A further representation was made by him on 23-1-2010 on similar lines. The petitioner in W.P.No.19732/2010, in his representation dated 7-9- 2009 addressed to respondent No.2, submitted that if a second weigh bridge is installed near the entrance where he was earlier running the weigh bridge, it causes grave injustice to him and requested him not to permit installation of a second weigh bridge. A news item appeared in the Press on 15-5-2010 wherein respondent No.2 was stated to have issued Circular No.S111(1)5067/2007, dated 29-4-2010 permitting the Market Committee to establish another electronic weigh bridge. Evidently, on coming to know about this news, six persons have submitted their applications who include respondent No.5 and the petitioner in W.P.No.21758/2010. The petitioner in W.P.No.20487/2010 submitted its representation dated 19-5-2010 on noticing the said news item. It was stated therein that he is interested in setting up the weigh bridge and that the necessary qualifications required for allotment of site may be informed as no such details have been published in the Press. In the meantime, the Market Committee has forwarded its resolution dated 31-8-2009 to respondent No.2 for his approval. Respondent No.2, vide letter No.SIII(1)5067/2007, dated 29-4-2010, addressed to the Person-in-charge of the Market Committee, has permitted the Market Committee to take further action in pursuance of its resolution dated 31-8-2009. In pursuance of the said proceeding, the Chairman of the Market Committee issued proceedings No.AMCG/Licence/71/2007- 08 dated 9-8-2010 whereby he has issued permission to respondent No.5 for erection of 40 M.Ts. capacity electronic weigh bridge at the market on lease basis. It is stated therein that the lease shall be collected by the Market Committee as fixed by the Executive Engineer (M), T.R., Hyderabad. He has however stated therein that the said allotment is subject to the outcome of the Writ Petitions pending in this court. Through another proceeding dated 14-8-2010, the Chairman directed the Selection Grade Secretary to handover requisite space measuring 20 x 10 mts. to respondent No.5 situated at the rear side of the office building as identified by the Executive Engineer, T.R., Hyderabad. In pursuance of these two proceedings, licence bearing No.Licence/01/2010 dated 28-8-2010 was issued. On the strength of these proceedings, respondent No.5 has installed the weigh bridge and been running the same. As noted above, the petitioners have questioned this action in these Writ Petitions. At the hearing, the learned counsel for the parties have advanced detailed submissions. The petitioners in three out of five Writ Petitions have mainly contended that the entire process leading to allotment of site in favour of respondent No.5 is vitiated by procedural illegalities and arbitrariness. The learned Counsel further submitted that the lease pertains to public property and that therefore respondent No.2 and the Market Committee should have followed the method of inviting tenders from the general public in order to maintain transparency and secure public interest. This procedure having not been followed, contend the learned Counsel, the allotment of site in favour of respondent No.5 is not sustainable in law. Sri S.Satyam Reddy, the learned Counsel for the petitioner in W.P.No.11463/2010, submitted that the petitioner was forced to shift the weigh bridge from the front side to the rear side in the year 2005 on the purported ground of traffic congestion and that four years thereafter, respondent No.2 and the Market Committee have permitted respondent No.5 to operate weigh bridge on the front side. He further submitted that such a decision on the part of respondent No.2 and the Market Committee is wholly arbitrary and discriminatory. While pleading to restrain the respondents from running the second weigh bridge, the learned Counsel alternatively contended that even if a second weigh bridge is to be permitted, it should be done by following the tender process only. Sri O.Manohar Reddy, the learned Counsel the petitioner in W.P.No.21758/2010 submitted that respondent No.2 and the Market Committee failed to follow the order of this court in W.P.No.19185/2008 and therefore allotment of land in favour of respondent No.5 is liable to be quashed. The learned Counsel alternatively argued that even if respondent No.2 and the Market Committee are entitled to lease out the land overlooking the petitioner, they can do so only by auctioning the leasehold rights. Sri D.Jagan Mohan Reddy, the learned Counsel for the petitioner in W.P.No.19520/2010 submitted that the respondents having followed the procedure of inviting applications from the general public when the allotment of site for the first weigh bridge was granted, failed to follow a similar procedure while allotting site for the second weigh bridge. Opposing the submissions of the learned counsel for the petitioners, Sri P.Gangaiah Naidu, learned Senior Counsel appearing for respondent No.5, advanced the following contentions: (i) The Market Committee’s decision can be assailed before the Director and later before the Government. The petitioners should therefore have availed these alternative remedies and the Writ Petitions filed bypassing these remedies are liable to be dismissed; (ii) The Market Committee decided to have the second weigh bridge in August 2009 and selection was made in March 2010. Even if the proceedings dated 29-4-2010 and 3-8-2010 of respondent No.2 are set-aside, the Market Committee’s decision remain unchallenged; (iii) Letters dated 29-4-2010 and 3-8-2010 are internal correspondence, which are not amenable for judicial review and consequently they are not justiciable; (iv) While granting lease in favour of respondent No.5, neither the statutory provisions nor the rules and bye-laws made thereunder have been violated; and (v) The petitioners are not educated unemployed and therefore they have no locus-standi. The learned Government Pleader for Agriculture representing respondent Nos.1 and 2 and Sri K.Upender Reddy, learned Standing Counsel representing the Market Committee supported the submissions of Sri P.Gangaiah Naidu. Let me first consider the principal submissions of the learned counsel for the petitioners in W.P.Nos.11463/2010 and 21758/2010. In W.P.No.11463/2010, the petitioner was successful in getting lease for 30 years for operating the first weigh bridge. As noted hereinbefore, he was made to shift his weigh bridge from the front side to the rear side in the year 2005. Even according to the petitioner, after the initial resistance he has given in and shifted the weigh bridge to the rear side in the year 2006. If he felt that demand for shifting was illegal and improper, he should have questioned the same by availing appropriate remedy. The petitioner failed to avail any such remedy and therefore in my opinion, it is not permissible for him to question the decision of respondent No.2 and the Market Committee to make available site for a second weigh bridge on the front side. From the statistics furnished by the Market Committee by way of a note, it is quite evident that it was becoming difficult for it to handle the huge rush on account of high number of vehicles transporting different varieties of fruits to the market from various parts of the country with one weigh bridge. It is obviously under these circumstances that the Market Committee has decided to have a second weigh bridge. Having already shifted his weigh bridge to the rear side unconditionally, the petitioner cannot as of right insist that either there should not be any second weigh bridge or that if there is to be one, he shall be permitted to run his business on the front side. At the hearing, the learned Senior Counsel appearing for respondent No.5 and the learned Standing Counsel for the Market Committee have submitted that after the year 2005, the congestion on the front side was removed by evicting some traders and that in view of the changed situation, the new weigh bridge can be run on the front side. This statement is not disputed by the learned counsel for the petitioner. I am therefore of the opinion that by permitting a second weigh bridge, none of the petitioner’s rights have been violated by the respondents. This plea of the petitioner in W.P.No.11463/2010 is therefore rejected. As regards the submission of the learned counsel for the petitioner in W.P.No.21758/2010, this court has directed that preference should be given to the petitioner. By its very nature, preference is different from reservation. In the former case where all things are equal, the person concerned will be given preference, while in the latter case, consideration is confined to one particular category to the exclusion of others. While the order does not spell out any reason for directing the Market Committee to give preference to the petitioner, from the pleadings of the case it would appear that this court obviously kept in mind the plea of the petitioner that he is physically challenged with 45% disability and that under the provisions of The Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995, the appropriate Government and the local authority shall reserve 3% in all poverty alleviation schemes to the persons suffering from physical disability. This order of this court has attained finality. However, in the guise of this court’s order, the petitioner cannot claim exclusive right for allotment of the site to the exclusion of others. He has to necessarily compete with all others. While so competing, if the petitioner made his offer on par with others then he is entitled to preference over other competitors. Coming to the core issue raised by the learned counsel for the petitioners, namely, whether the method followed by respondent No.2 and the Market Committee is permissible in law, it needs to be noted that neither the Act nor the rules or the bye-laws made thereunder envisaged any particular procedure to be followed in the matter of establishment of weigh bridges. But the law is too well settled that when the public property is intended to be disposed of either by way of sale or lease, ordinarily it should be through public auction or by inviting tenders. While this is not an inviolable principle, when a departure is made from this general rule, it must be shown that such an action is impelled by strong and convincing reasons or administrative exigencies. (See: Shri Sachidanand Pandey Vs. State of West Bengal[1] and G.D. Zilani Vs. Union of India[2]). In Ramana Dayaram Shetty Vs. International Airports Authority of India and others[3] and Ram and Shyam Co. Vs. State of Haryana[4], the Supreme Court held that the power or discretion of the Government in the matter of granting of largesse including award of contracts must be confined and structured by rational, relevant and non-discriminatory standards or norms and if the Government departs from such standards or norms in any particular case or cases, the action of the Government would liable to be struck down unless it can be shown that such departure was not arbitrary but was based on some valid principle which in itself was not irrational, unreasonable or discriminatory. In Netai Bag Vs. State of West Bengal[5], the Apex Court held that when State largesse is decided to be conferred, resort should be had to inviting tenders as that would be a sure method of guaranteeing compliance with the mandate of Article 14 of the Constitution. I n Kasturi Lal Lakshmi Reddy Vs. State of Jammu and Kashmir[6], the Supreme Court held that the Government cannot act in a manner which would benefit a private party at the cost of the State; such action would be both unreasonable and contrary to public interest. I n Meerut Development Authority Vs. Association of Management Studies[7] the Apex Court held that the executive does not have an absolute discretion and that public interest being the paramount consideration, for securing such public interest one of the methods recognized is to invite tenders affording opportunity to submit offers for consideration in an objective manner. This firmly established principle is manifested in Circular No.Rc.II(2)2425/87, dated 20-12-1990 of respondent No.2, though issued in a slightly different context. The said circular was issued when respondent No.2 found that the market committees were following different procedures in allotment of shops- cum-godowns to the traders in the market yards and also in fixing the terms and conditions in the lease deeds being entered into with the traders. In order to streamline the procedure in allotting shops-cum- godowns, respondent No.2 has issued the said circular by laying down uniform terms and procedures to be followed by the market committees. Clause-2 of the circular envisaged that the shop-cum- godown shall be let out on lease by auction in the presence of the Joint Director of the Marketing concerned. Under Clause-3 power is conferred on the market committee to confirm the bid at its level in favour of the person who offers the higher lease amount. Clause-6 envisages that the auction is not for outright sale but only for fixation of rent on monthly basis and whoever bids for the higher lease amount shall be given the shop-cum-godown on lease. This, in my opinion, is totally in consonance with the settled legal position referred to above. Even though this procedure is laid down in respect of lease of shops- cum-godowns by the market committees, I do not find any justification whatsoever for not following this procedure in any other case involving disposal of the properties of the market committees by way of leases. Such a method will completely eliminate arbitrariness, discrimination, irrationality and favouritism. Admittedly, respondent No.2 and the Market Committee have not followed this procedure. Even the Judgment in Villianur Iyarkkai Padukappu Maiyam Vs. Union of India and others [8] does not lay down any different proposition of law. After an exhaustive consideration of the facts leading to the award of contract in favour of respondent No.11 in that case, the Apex Court observed in paragraph-163 that on the facts and in the circumstances of the case, it is of the firm opinion that the events leading to the award of letter of intent to respondent No.11in June 2005 do not indicate, in any manner, that the Government had acted arbitrarily or that the letter of intent was issued to favour respondent No.11 with oblique motives and therefore the contention of the appellants in that regard was rejected. In paragraph-164, the Supreme Court observed that non-floating of tenders or not holding of public auction will not in all cases be deemed to be the result of the exercise of the executive power in an arbitrary manner. As noted hereinabove, wherever the departure from tender process is made, the facts and circumstances should justify such departure, that the respondents failed to offer any such justification is evident from the discussion proposed to be undertaken hereafter. The method and manner by which respondent No.5 has been selected is interesting, nay, intriguing. It is therefore relevant to dwell on this aspect. The genesis of the permission for the second weigh bridge is traceable to resolution No.4, dated 7-8-2009 of the Market Committee. A perusal of this resolution would show that six persons have applied for allotment of site. It passes one’s comprehension as to how these six persons came to know about the proposal for permitting a second weigh bridge. It is no one’s case that the Market Committee has made any public announcement in pursuance of which such applications were made. Except the petitioner in W.P.No.21758/2010, no other applicant including respondent No.5 has approached any court in connection with this issue earlier. In his counter affidavit, the Selection Grade Secretary of the Market Committee while explaining the need for a second weigh bridge stated that the Committee decided to establish the second weigh bridge and six persons made applications. Even the petitioners failed to explain how they have come to be aware of the Market Committee’s proposal for permitting a second weigh bridge. More curious is the way in which the applications were considered by the Market Committee. In its resolution, the Market Committee while purporting to consider the six applications observed that after examining the rates being collected by the management of the existing weigh bridge, the Market Committee has taken into consideration the proposal of respondent No.5 that he is prepared to reduce the rates “to some extent” and unanimously resolved to accept the offer of respondent No.5 and send the same to respondent No.2 for approval. As already noted, the Chairman of the Market Committee has given his dissenting opinion. The Market Committee has failed to discuss the contents of the offers made by the other applicants, if any. It has failed even to compare the merits and demerits of the other applicants with that of respondent No.5, more so, when this court in W.P.No.21758/2010 directed that Sri N.Pulla Reddy, the petitioner therein, shall be given preference. Not even an attempt appears to have been made by the Market Committee to call all the applicants for negotiations and accept the best of the offers even among those six applicants. On the contrary, the tone and tenor of the resolution gives an impression that the Market Committee has already pre-judged the issue in favour of respondent No.5 and has only gone through the