IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) THURSDAY, THE THIRTY FIRST DAY OF JULY TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MR JUSTICE GODA RAGHURAM WRIT PETITION NO : 5035 of 2007 WRIT PETITION NO : 5035 of 2007 Between: M/s.Klen & Marshalls Manufacturers & Exporters Ltd., Head Office at 144, Eskay Building, Greams Road, Chennai - 600 006 and having its Branch office at Flat No.312, 3rd floor, Amarchand Sharma Complex, 83 & 84, S.P. Road, sEcunderabad - 500 003, rep. by its Authorised Signatory R.Vijaya Kumar. ..... PETITIONER AND 1 M/s. Central Power Distribution Company of Andhra Pradesh Limited, having its Regd office at Singareni Bhavan, Red Hils, Hyderabad rep. by its Chairman and Managing Director. 2 The Superintending Engineer (Operation and Maintenance) Central Power Distribution Company of Andhra Pradesh Limited, having its Regd office at Singareni Bhavan, Red Hills. .....RESPONDENT(S) Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Aﬃdavit ﬁled herein the High Court will be pleased to to issue a writ, order or direction more particularly one in the nature of writ of mandamus, by declaring the action of the respondents in ﬂoating tender notiﬁcation vide No.SE/O&M/SP.NO.02/2006-2007 Dated Nil same as illegal, arbitrary and violative of principles of natural justice and consequently direct that the respondents that the petitioner has a preferential right to maintain the 28 CBSUs until the expiry of the Operational Lease Agreement dated 29.09.1999 and pass such other order/s. Counsel for the Petitioner:MR.B.CHANDRASEN REDDY Counsel for the Respondent No.: MR.O.MANOHER REDDY WRIT PETITION NO : 9765 of 2008 Between: M/s.Klen & Marshalss Manufacturers & Exporters Ltd having its Branch office at Flat No.312, 3rd floor Amarchand Sharma Complex, 83&84, S.P.Road Secunderabad- 500003, rep.by its Authorised Signatory R.Vijaya Kumar ..... PETITIONER AND 1 M/s.Eastern Power Distribution Company of Andhra Pradesh Limited, (Operation and Maintenance) having their corporate office at Seethamma Dhara, Visakhapatnam rep.by Chief General Manager(O&CS) 2 M/s.Eastern Power Distribution Company of Andhra Pradesh Limited, Operation circle, Eluru, West Godavari District rep.by its The Superintending Engineer 3 Transmission Corporation of Andhra pradesh Limited (AP Transco), Vidyuth soudha, Khairathabad,Hyderabad 4 M/s.Kumar Electricals ,Plot No.60C,II Floor, Addagutta Society, Jalavayu Vihar Road, Beside Arjuna Theatre Opp;KPHB colony, Hyderabad-72 .....RESPONDENT(S) Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Aﬃdavit ﬁled herein the High Court will be pleased to to issue a writ order or direction more particularly one in the nature of writ of mandamus to set aside the agreement for maintenance of capacitor banks dated 19.6.2007 entered between 1st respondent and 4th respondent to the extent of 32 numbers of capacitor banks which are located in Eluru circle, and declare the same as illegal, arbitrary, violative of principles of natural justice and not in accordance of law and pass Counsel for the Petitioner:MR.B.CHANDRASEN REDDY Counsel for the Respondent No.: MR.O.MANOHER REDDY The Court made the following common : THE HON’BLE SRI JUSTICE GODA RAGHURAM W.P.No. 5035 of 2007 and W.P.No. 9765 of 2008 Common Oral Order: The same petitioner-company has ﬁled these two writ petitions. W.P.No. 9765 of 2008 seeks invalidation of an agreement dated 19-06-2007 for maintenance of Capacitor Banks entered into between the 1st and 4th respondents to the extent of 32 number of capacitor Banks in Eluru circle; and W.P.No. 5035 of 2007 is for a declaration that the action of the respondents in ﬂoating the tender notiﬁcation NoSE/O &M/SP.No.02/2006-2007 dated –nil- is illegal and for a consequential direction to the respondents to recognize the petitioner’s preferential right to maintain the 28 CBSUs until the expiry of Operational Lease Agreement dated 29- 09-1999. The petitioners entered into an agreement with the Eastern Power Distribution Company of Andhra Pradesh Limited (for short ‘the EPDCL) and the Central Power Distribution Company of Andhra Pradesh Limited respectively for installation, commissioning and maintenance of 11 KV 2 MVAR Capacitor Banks System Units ( for short the ‘CBSUs’) at various sub-stations in the State. The agreement was entered into on 27-11-1997 for a primary period of six (6) years. The lease period has since been extended. In terms of the agreement between the parties, the petitioners installed the CBSUs in the year 2001 and maintained the equipment leased for a period of six (6) years since then. The respondent-Power Distribution Companies have, after the six (6) year period (during which there are reciprocal obligations for the petitioner to maintain and the respondent-Corporation to accept such maintenance obligations of the petitioners of the equipment leased), called for tenders for award of maintenance contracts. The petitioners claim a preferential/exclusive right to maintain the equipment which is under an extended lease to the respondents, on a premise that being the substantive owner of the equipments/CBSUs, the petitioners must have an adjunct and preferential right to maintain the leased equipment/CBSU’s. Admittedly, the relationship between the parties is covered by the terms of the contract entered into between them. Clause 5 (b) of the terms of extension lease contract dated 29-09-1999 ( which is illustrative of the terms between the parties in respect of the contracts with regard to lease of CBSUS) reads thus: ‘5.The Lessee hereby declares to the Lessor: a. xxx xxxx xxx xxx. b. On completion of ﬁxed lease period of six years the lease shall continue without maintenance on a consolidated lease rental of Re.1/- per annum for all Banks and Lessor will have no right to terminate the agreement and the Lessor shall not keep or create any encumbrances on the equipment and shall have no right to move or shift the equipment. Lease shall continue till it is terminated by Lessee.’ On a true and fair construction of this clause of the contract between the parties, it is clear beyond disputation that the lease beyond the initial period of six (6) years would continue without maintenance and on consolidated lease rental of Re. 1-00 per annum. Clause 7 (a) reads thus: ‘7. It is hereby mutually agreed by the Lessor and the Lessee as under, namely:- a. Notwithstanding the grant of the lease of the said equipment the Lessee would not, merely by reason or grant of this lease, have any right, title or interest in any piece of equipment except as the Lessee thereof in accordance with the terms and condition of this Lease Contract No. CE/DFID & S1/E8/AMO 159/EXTN. 0163/99 dated 29-09-1999 and amendment issued in the letter No. CE/DFID/E1/PO.No. AMO 163/99/-D.No. 208/2001, dated 08-06-2001”. On terms, Clause 5 (b) and 7 (a) disentitle any claim of the petitioners to a preferential or prescriptive right to maintain the leased equipment after the initial period of six years, which admittedly has expired. It is axiomatic that a legal right is the foundation for grant of a writ of Mandamus. The petitioners have not established any right whatsoever let alone a legal right. The writ petitions are therefore misconceived, beseech rejection and are accordingly dismissed. No costs. ____________________ GODA RAGHURAM, J Dated: 31-07-2008 pvks