Safiya Malik

The High Court of Andhra Pradesh Single Bench of Justice Gannamaneni Ramakrishna Prasad disposed of a batch of petitions arising from a dispute between a licence-holder and the Andhra Pradesh State Road Transport Corporation over the termination of licences to operate multiple commercial open spaces at Yerraguntla Bus Station and the issuance of a fresh tender for those spaces. While declining relief against the licence termination on the basis of established breaches of licence conditions, the Court set aside the tender notification and directed the authorities to refund bidders’ deposits and issue a fresh tender that prevents any one person from bidding for more than one space. The Court also noted that allotting multiple commercial spaces to a single individual by State instrumentalities encourages monopoly and vested interests, contrary to public interest and the Directive Principles.

The proceedings concerned four writ petitions filed by the same petitioner, challenging actions taken by different State authorities, including the Andhra Pradesh State Road Transport Corporation (APSRTC). Three writ petitions were rendered infructuous as no surviving cause of action remained. The surviving dispute related to the termination of licences granted to the petitioner for multiple open spaces at a bus station and the issuance of a subsequent tender notification for the same spaces.

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The petitioner had secured licences pursuant to a tender process and entered into agreements for operating various open spaces for commercial activities. The licences were terminated through orders issued in November and December 2023, following show cause notices alleging non-payment of licence fee and violation of licence conditions. The petitioner contended that the termination orders were arbitrary and violative of constitutional guarantees, and also assailed the fresh tender notification issued thereafter.

The respondent corporation filed a counter affidavit asserting that the petitioner had sub-let the licensed spaces to third parties in violation of licence conditions. Documentary material, including written confirmations from sub-tenants and transaction records, was placed on record. The petitioner did not file any rebuttal disputing the authenticity of these materials.

While examining the broader practice followed by the Corporation, the Court observed that “the very practice adopted by the APSRTC by granting several licences in favour of one single person i.e., the Writ Petitioner is a pernicious practice, thereby giving scope to the Writ Petitioner to sub-let the Open Spaces to the third parties unauthorisedly, thereby violating the conditions of the licences. This apart, granting of several licences to a single person has also created a vested interest inasmuch as State largesse ought not to have been granted to a single person, thereby creating monopoly. It is the incumbent duty on the part of the Respondent Authorities to ensure that each Open Space is allocated to a different person, since such State largesse is created with an avowed object of ensuring that the material resources of the community are so distributed as best to sub-serve the common good (Article 39(b)); and that the State shall in particular, strive to minimize the inequalities in income (Article 38(2)) on one hand and to prevent development of vested interest or monopoly on the other hand".

The Court further observed: "The facts involved in the present case is a classic example of the Writ Petitioner developing vested interest since he had bidded for several shops, thereby giving scope to the Writ Petitioner to sub-let the Open Spaces to several third parties. This indicates that a laxity on the part of the Official Respondents had enabled the Writ Petitioner to create his own eco-system that made him to blatantly abuse the tender conditions and the conditions of licence".

The Court stated that: “this Court has no other option but to accept the contentions of the Respondent Corporation that the Writ Petitioner has violated the conditions of the licence, inasmuch as the Writ Petitioner has sub-let the Open Spaces to the third parties in violation of the licence conditions. The Writ Petitioner has also violated the terms of the licence inasmuch as the businesses earmarked for the Open Spaces have not been followed by the Writ Petitioner beside the default of non-payment of licence fee/monthly rents. On the contrary, the Writ Petitioner had approached this Court with unclean hands inasmuch as Writ Petitioner had complained of illegal encroachment by third parties which he had illegally sub-let the Open Spaces to the third parties or sub-tenants in violation of the conditions of the licence".

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The Court recorded that “the present Writ Petition is devoid of any merit” insofar as the challenge to the termination of licences was concerned, and accordingly ordered that “this Writ Petition is dismissed. No Order as to Costs. The other Writ Petitions bearing W.P.Nos.31871, 32835 of 2022 & 30041 of 2023 have become infructuous and accordingly disposed of as such.”

The Tender Notification bearing Sl.No.E2/797(1)2024-EPTO/Y dated 04.01.2024 (Ex.P.1) is quashed and set aside.” The Court further directed that “there shall be a direction to the Official Respondents to refund all the deposits submitted by the bidders including the Writ Petitioner within a period of three weeks from today if not refunded earlier.”

The Respondent Corporation is directed to prepare a fresh Tender which ensures that a single person cannot bid for more than one licence (for Open Space).” It was also recorded that “Interlocutory Applications, if any, stand closed in terms of this order.”

Advocates Representing the Parties

For the Petitioners: Sri Venkateswarlu Kolla, Advocate; Smt. G. Urmila, Advocate

For the Respondents: Sri Aravala Rama Rao, Standing Counsel for APSRTC.

Case Title: V. Rabbani Basha v. State of Andhra Pradesh & Others
Neutral Citation: APHC010520862022
Case Numbers: W.P. Nos. 31871, 32835 of 2022; 30041 of 2023; 1690 of 2024
Bench: Justice Gannamaneni Ramakrishna Prasad