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Judgment
M. Chockalingam, J.—Challenge is made to an order of the third respondent passed on 11.7.2007, in Ref. No. CH4/9 COCO at S. No.
152/4B, Pudukkottai North Panchayat, Alangudi Road, Pudukottai. The petitioners have brought forth this petition seeking a writ of certiorarified
mandamus.
The affidavit in support of the petition along with the grounds are perused. The Court heard the learned Counsel on either side,and the materials
are also scrutinised.
As could be seen from the available materials and the submissions made by the learned Counsel for the petitioners, a license to run a petrol
outlet at Alangudi Road, Pudukottai, was granted to one Sumathi for a period of one year from 2002 to 2003, and it was renewed, and since she
was sick, she could not further continue the same, and she had got a proposal to sell the same. According to the petitioners, they purchased the
said piece of land for a heavy price, and they applied for the interview which was done by the second respondent Corporation, pursuant to which
a contract was entered into between them originally for one year namely 2004-2005, and subsequently, it was renewed for 2005-2006 and also
for a period of six months. While the matter stood thus, the impugned order was served upon the petitioners stating that the contract was
terminated, and the notice for that purpose will have its effect from 11.7.2007, and hence, necessary proceedings have got to be followed, and the
contract stood terminated from 10.8.2007. Aggrieved over the same, the petitioners have brought forth this writ petition before this Court.
The learned Counsel for the petitioners with vigour and vehemence would submit that in the instant case, it is not in controversy that originally,
lease was granted in favour of one Sumathi for a period of one year; that since she could not continue due to her sickness, the petitioners were
permitted to run the petrol outlet pursuant to an interview, and it has been subsequently renewed; that the renewal documents if looked into, would
clearly indicate that it was not a license, but permission; that permission and license cannot go together; that apart from this, the permission
originally what was granted and subsequently renewed, for no reasons or fault on the part of the petitioners, was suddenly terminated; that needless
to say that the undertaking of the third respondent Corporation is being done by the State, and thus, it has got mighty bargain; that by exercise of
that mighty bargain arbitrarily and without any reason whatsoever, it has terminated the contract in question, which it should not have done; that
apart from that, in the instant case, the petitioners have purchased the property for a sum of Rs. 22 lakhs from Sumathi, who was the original
owner, and have also been running the petrol outlet; and that this purchase was made and a rest room at a cost of Rs. 3 lakhs was also constructed
only on the assurance given by the respondents that it would be renewed continuously; but, to their shock and surprise, it has been terminated
without any reason whatsoever.
The learned Counsel relied on the decisions of the Apex Court to say that even in the case of fault, the Government cannot act arbitrarily and
terminate the contract to the disadvantage of the person in whose favour the contract was given; that in the instant case, no fault of the petitioners is
noticed; that the third respondent has suddenly addressed a communication which is under challenge; that nowhere it speaks about any mistake or
reason or fault on the part of the petitioners, and under the circumstances, the Court has to come to the rescue by issuing a writ as one asked for in
this case.
The learned Counsel relied on Clause ""r"" of the contract, which reads that the M & H Contractor will inform the Company at least 30 days in
advance of the expiry date of the Licenses, permissions, etc. of the retail outlet to enable the Company to renew the same. The learned Counsel
would further add that the petitioners have purchased the land for a heavy price and made improvements on the assurance given by the
respondents, and thus, it amounts to legitimate expectation.
Contrary to the above contentions, the learned Counsel for the respondents 1 and 2 relying upon the contract entered into between the parties,
would submit that as per Clause 48, the agreement is only for a period of one year having effect from 31.3.2006 to 30.3.2007 subject to the
renewal by the year 2007 at the Company''s option at the same rates and on the same terms and conditions as contained in that agreement, and
without prejudice to the same, the agreement could be terminated at the option of either party by giving at least one month''s notice in writing to the
other party without assigning any reason whatsoever; that after the license period as found in the agreement, was over on 30.3.2007, the impugned
order has been passed terminating the contract given to the petitioners; that even that Clause would be binding on both the parties; that in addition
to that, 30 days'' notice has got to be given for termination, and further, no reasons are necessary to be assigned; that under the circumstances,
without assigning any reason, the termination has been made, and under the circumstances, the contention put forth by the learned Counsel for the
petitioners cannot be countenanced.
Added further the learned Counsel that it was only a license; that there was no occasion for the Company to come forward to give any
assurance; that the petitioner could have purchased the land in order to continue the outlet ever long; that even the contract entered into between
the parties, would clearly reveal that if there is any dispute between the parties, either of the party must go before arbitration and not before the
Court of law; and that under the circumstances, even assuming that the petitioners are aggrieved by the termination order, they should have gone
for arbitration.
The learned Counsel relied on a decision of the First Bench of this Court in W.A. No. 737 of 2007 dated 7.6.2007, and would further add that
in the instant case, once the license period is over, they are entitled to terminate the contract; that even as per the agreement, it was understood
between the parties; that accordingly, it has been done, and hence, the writ petition has got to be dismissed.
The Court paid its anxious consideration on the submissions made and also looked into the materials available.
This Court is afraid whether it could agree with the case of the petitioners herein. It is not in controversy that the land on which the outlet is
being run, originally belonged to one Sumathi, and she was actually running the outlet pursuant to a license issued in her favour. A very reading of
the affidavit would make it clear that it was only a license and not a lease. Admittedly, it was given to the petitioners for a period of one year. It
was renewed subsequently and came to an end on 30.3.2007. Thus, it is clear that there was a renewal. The learned Counsel for the petitioners
relied upon the word ""renewal"" used on the earlier occasion when the contract was renewed. Nowhere in the entire contract entered into between
the parties at the earliest or the present one entered into between the parties or the latest renewal, the word ""lease"" is found; but, it was found
either the license or the permission. Needless to say that the concept of license and lease are entirely different. As could be seen, the petitioners
cannot travel beyond the Clauses what are found in the agreement entered into between the parties. Even Clause ""r"" relied on by the petitioners,
would also reveal that it was only a license since it says that M & H Contractor will inform the Company at least 30 days in advance of the expiry
date of the licenses, permissions, etc. of the retail outlet to enable the Company to renew the same. The contention put forth by the learned
Counsel for the petitioners that the word ""permission"" is used and therefore, the case of the petitioners has got to be accepted cannot be
countenanced in law since it was not a lease, but only a license or permission. It would be more apt and appropriate to reproduce Clause 48 as
follows:
The agreement will be for a period of ONE YEAR effective from 31.03.2006 TO 30.03.2007 subject to the renewal by the year 2007 at the
Company''s option at the same rates, and on the same terms and conditions as are herein contained. Without prejudice to the aforesaid, this
Agreement may be terminated at the option of either party by giving at least one month''s notice in writing to the other party, without assigning any
reason whatsoever. In case of breach of contract, the Company reserves the right to terminate this Agreement forthwith. Unless otherwise
mentioned or renewed in writing this Agreement stands automatically terminated at the end of the agreement period. If any information given by the
M & H Contractor in his application for appointment shall be found to be untrue or incorrect, in material respect, the Company reserves the right
to terminate this Contract forthwith.
The above Clause would clearly reveal that whenever the period of one year is over, it could be terminated, and one month''s notice is
sufficient and no reasons to be assigned therefor. Under the circumstances, such a notice has been issued validly terminating the contract.
As regards the contention put forth by the learned Counsel for the petitioners that they have purchased the property from the erstwhile owner
for a fabulous price and also made developments only on the assurance made by the Company, no material is available to indicate the same; but,
only the mere assertions are made by the petitioners which are found in the affidavit, and the same cannot, but be to their advantage only. Merely
because it was purchased for such a price and improvements have also been made, the petitioners cannot compel the respondents Company that
the contract has got to be renewed.
Apart from the above, the contention put forth by the learned Counsel for the petitioners that it is a legitimate expectation cannot be accepted
by the Court even for a moment. It was only the fond hope of the petitioners without any vested right, and therefore, it cannot be stated to be a
legitimate expectation in law. The mere fond hope or desire of a person to obtain a thing may not amount to legitimate expectation. To call it as a
legitimate expectation, the expectation must be legitimate. In the instant case, it is not so. Under the circumstances, all the contentions put forth by
the learned Counsel for the petitioners do not carry any merit whatsoever. Accordingly, this writ petition fails and the same is dismissed. No costs.
Consequently, connected MP is also dismissed.