High Court of KeralaSingle Judge2021-02-08Writ petition disposed of with a direction to K...

N.P. Kunhabdulla v. Kerala State Road Transport Corporation and others

Case / Petition Number:WP(C).No.41641/2017

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: N. Nagareesh
Judgment Date: 2021-02-08
Court Decision / Holding: Writ petition disposed of directing the Managing Director of KSRTC to consider whether starting a kiosk at the proposed location would adversely affect the petitioner’s bakery business and to take an appropriate decision within two months. Interim order dated 30.01.2018 continues until a decision is taken.
Final Disposition: Writ petition disposed of with a direction to KSRTC’s Managing Director to assess the impact of the proposed kiosk on the petitioner’s business and to decide within two months; interim relief continues until a decision is made.

Parties to the Case

Appellants / Petitioners

N.P. Kunhabdulla

Respondents

Kerala State Road Transport Corporation (KSRTC)
Assistant Transport Officer, KSRTC, Payyannur
District Transport Officer, Kannur
K.C. Shuhabudeen

Legal Representation & Advocates

Counsels for Petitioners

• Kaleeswaram Raj
• A. Aruna Kum
• Thulasi K. Raj

Counsels for Respondents

• P. C. Chacko

Case Synopsis & Summary

Petitioner N.P. Kunhabdulla, a licensee operating a bakery in the KSRTC Shopping Complex at Payyannur Bus Station, challenges KSRTC’s grant of permission to a fourth respondent to erect a kiosk and related structures, which the petitioner argues would obstruct the open space and parking promised in Ext. P3. The petitioner, a licensee of shop G-16, paid a substantial interest-free deposit of ₹23,10,000 and monthly license fees, and asserts that the respondents, after inviting business proposals, estopped themselves from permitting erection of any structure that would hinder the business. The 4th respondent allegedly started constructing a coffee vending kiosk, obstructing the petitioner’s view and blocking parking. The respondents contend that the 4th respondent was licensed to install vending facilities in KSRTC’s premises, with permission to expand to snacks and cold drinks on a 30 sq ft area, upon payment of enhanced license fees. The petitioner relies on estoppel, including promissory estoppel, supported by Supreme Court authorities (Nestlé, Motilal Padampat, Manuelsons Hotels) to argue that the State cannot defeat the petitioner’s business by new constructions. The Estate Officer rejected the petitioner’s representation. The Court disposes the petition by directing the KSRTC Managing Director to assess whether the kiosk would adversely affect the bakery business and to decide within two months, while keeping the interim relief in force.

Legal Doctrines & Maxims

Estoppel (including promissory estoppel)
Equity and good faith
Honesty and good faith as governing principles

Submissions & Arguments

Contentions of Appellants / Petitioners

Counsel for the petitioner contends that estoppel extends to the State and its instrumentalities and that promissory estoppel can sustain an independent cause of action where the petitioner has relied on representations. Relying on State of Punjab v. Nestlé India Ltd. and others, Motilal Padampat Sugar Mills Co. Ltd. v. State of U.P. and others, and Manuelsons Hotels Pvt. Ltd. v. State of Kerala, the petitioner argues that the KSRTC’s brochure Ext. P3 promised parking and lucrative prospects, creating a legitimate expectation that the petitioner’s business would not be obstructed. The petitioner points to the substantial deposit and ongoing license fees as part of reliance and asserts that the State cannot permit construction that would thwart the licensee’s business. The court is urged to restrain any obstruction and to protect the petitioner’s rights, viewing promissory estoppel as a potential basis for relief in writ proceedings against a state instrumentality when a contractual relationship is involved.

Contentions of Respondents

The respondents argue there is no binding promise to the petitioner beyond the license grant; there is no exclusive right to the parking area or the space outside the shop. They contend the 4th respondent’s kiosk was approved after a Tender Committee process and on payment of enhanced license fees, and that such actions are in the interest of KSRTC. They contend the writ petition is filed on an experimental basis and should be dismissed, as the respondent KSRTC must balance commercial interests and public zeal, and the petition does not establish a contractual obligation between the State and the petitioner beyond the license arrangement. The estate officer’s order allowing the broader revenue motive is cited to justify the contested construction. The respondents submit that the extent of impact on the petitioner’s shop is a matter for KSRTC to decide, not for this Court to compel by estoppel alone.

Cited Precedents (4)

Case Name	Citation	Treatment	Explanation
State of Punjab v. Nestlé India Ltd. and another	(2004) 6 SCC 465	Positive	Cited to support the broad application of estoppel against the State and its instrumentalities.
M/s.Motilal Padampat Sugar Mills Company Limited v. State of Uttar Pradesh and others	(1979) 2 SCC 409	Positive	Cited to emphasize estoppel as a product of equity promoting honesty and good faith.
Manuelsons Hotels Private Limited v. State of Kerala and others	(2016) 6 SCC 766	Positive	Cited to illustrate that promissory estoppel can form the basis of an independent cause of action where reliance exists.
ABL International Ltd. and another v. Export Credit Guarantee Corporation of India Ltd. and others	(2004) 3 SCC 553	Mentioned Only	Mentioned in the context of writ petition maintainability against a State arising from contractual obligations.

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Extracted Judgment Text

Exact text extracted from official judgment records.

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR.JUSTICE N.NAGARESH** **MONDAY, THE 08TH DAY OF FEBRUARY 2021/19TH MAGHA,1942** ## **WP(C).No.41641 OF 2017(E)** ## **PETITIONER:** **N.P.KUNHABDULLA, MARAKKAPPU KADAPPURAM, 'AJMAL' MANZIL, OZHINHA VALAPPU, NILEESHWARAM, KASARGOD-671328.** **BY ADVS. SRI.KALEESWARAM RAJ KUM.A.ARUNA KUM.THULASI K. RAJ** ## **RESPONDENTS:** **1 KERALA STATE ROAD TRANSPORT CORPORATION, REPRESENTED BY CHAIRMAN & MANAGING DIRECTOR, KSRTC, TRANSPORT BHAVAN, FORTE, THIRUVANANTHAPURAM-695001. 2 ASSISTANT TRANSPORT OFFICER, KSRTC, PAYYANNUR-670307. 3 DISTRICT TRANSPORT OFFICER, KANNUR-670001. 4 K.C.SHUHABUDEEN, ARAFAT MANSIL, PANNYANNUR, CHOKLI P.O., KANNUR-670672.** **BY SRI.P.C.CHACKO, SC, KERALA STATE ROAD TRANSPORT CORPORATION** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 08.02.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** WP(C) No.41641/2017 : 2 : ## **J U D G M E N T** ~ ~ ~ ~ ~ ~ ~ ~ ~ _**Dated this the 8[th] day of February, 2021**_ Petitioner, who is running a bakery in KSRTC Shopping Complex at Payyannur Bus Station, seeks to direct respondents 1 to 3, the KSRTC, Assistant Transport Officer and District Transport Officer respectively, to refrain from facilitating/permitting the 4[th] respondent or other persons from maintaining/running/operating any structure having the effect of blocking the open space promised in Ext.P3 which is near the Shop G-16 bearing door No.344/16 possessed by the petitioner. 2. The petitioner states that he is a licensee occupying shop G-16 in the KSRTC Shopping Complex at Payyannur Bus Station. The shop was licensed to the petitioner pursuant to Ext.P1 notification dated 05.01.2016 and Ext.P2 agreement WP(C) No.41641/2017 : 3 : dated 18.10.2016. The petitioner responded to Ext.P3 brochure leaflet of the KSRTC to get the licence. Ext.P3 offered minimum investment and attractive profit. Ext.P3 also stated about extensive parking facility. 3. The petitioner has remitted ₹23,10,000/- to the KSRTC towards interest free deposit. A monthly licence fee of ₹12,685/- is also being paid. Recently, the 4[th] respondent started to construct a Kiosk for vending coffee, obstructing the view of the shop licenced to the petitioner and occupying the parking space. The proposed Kiosk will cause obstruction to the free ingress of customers to the petitioner’s shop. After giving licence to the petitioner to run the shop, the respondents are estopped from permitting erection of any temporary or permanent structure hindering the business of the petitioner, contended the petitioner. 4. Respondents 1 to 3 defended the writ petition filing counter affidavit. The respondents stated that licence has been granted to the 4[th] respondent to install coffee vending machine in 67 units of KSRTC. Subsequently, the 4[th] WP(C) No.41641/2017 : 4 : respondent submitted application for permitting to conduct snack business and cool drinks in the 30 sq. ft. allotted to him and that was considered by the tender committee of the KSRTC and it was allowed on condition to pay enhanced licence fee. The 4[th] respondent is therefore entitled to construct the Kiosk. 5. The counsel for the petitioner, relying on the judgment of the Apex Court in _**State of Punjab v. Nestlé India Ltd. and another** [(2004) 6 SCC 465]_ , argued that the respondents 1 to 3 are estopped from causing hindrance to the business of the petitioner. The doctrine of estoppel is not limited only to cases where there is contractual relationship or other pre-existing legal relationship between the parties. The State is also equally susceptible to the operation of the doctrine in whatever area or field the promise is made. 6. Placing reliance on the judgment in _**M/s.Motilal Padampat Sugar Mills Company Limited v. State of Uttar Pradesh and others** [(1979) 2 SCC 409]_ , the counsel for the petitioner argued that the doctrine of estoppel is a child of WP(C) No.41641/2017 : 5 : equity brought into the world with a view to promoting honesty and good faith and bringing law closer to justice. Quoting the judgment of the Hon'ble Apex Court in _**Manuelsons Hotels Private Limited v. State of Kerala and others** [(2016) 6 SCC 766],_ it was observed that promissory estoppel can be the basis of an independent cause of action in which detriment does not need to be proved and it is enough that the party has acted upon the representation made. The petitioner acted upon the offer of the respondents to start business without any hindrance. The respondents therefore cannot take any such steps, which would adversely affect the petitioner's business, contended the learned counsel for the petitioner. 7. Relying on the judgment of the Hon'ble Apex Court in _**ABL International Ltd. and another v. Export Credit Guarantee Corporation of India Ltd. and others** [(2004) 3 SCC 553],_ the learned counsel for the petitioner urged that in appropriate cases, writ petition as against a State or an instrumentality of the State arising out of a contractual obligation, is maintainable. WP(C) No.41641/2017 : 6 : 8. The learned Standing Counsel representing respondents 1 to 3, on the other hand, contended that there is no promise given to the petitioner. What is given is only a licence to conduct a shop on payment of requisite fee. The petitioner does not have any exclusive right over the parking area or any place outside his shop. Respondents 1 to 3 have acted taking into account the best of the interest of KSRTC, which is a Public Sector Undertaking. The writ petition has been filed on an experimental basis and it is liable to be dismissed, contented the learned Standing Counsel representing respondents 1 to 3. 9. I have heard the learned counsel for the petitioner and the learned Standing Counsel for respondents 1 to 3. 10. The Estate Officer of the KSRTC, pursuant to the interim order of this Court, considered the representation of the petitioner and rejected the same holding that permission granted to construct Kiosk was with an intention to increase the revenue of KSRTC and the petitioner has no exclusive right over the parking place. WP(C) No.41641/2017 : 7 : 11. It may be noted that the issue involved is not confined to the right of the petitioner over the parking place. The petitioner has been granted a licence to run a Bakery in the KSRTC premises. Respondents 1 to 3 through their Ext.P3 brochure represented that the shop rooms of KSRTC are suitable for commercial establishments to generate attractive profits. The area allocated for parking was an added attraction. 12. The petitioner has made huge interest free deposit with the KSRTC and he is also paying substantial amount towards monthly licence fee. In such circumstances, it will be unjust and inequitable on the part of the respondents to permit any construction close to petitioner’s shop, which would substantially affect the business of the petitioner. 13. The Standing Counsel for respondents 1 to 3 would contend that the proposed Kiosk is situated at a distance of 25 to 30 metres from the shop of the petitioner and would not affect the business of the petitioner. The counsel for the petitioner would, on the other hand, state that the proposed WP(C) No.41641/2017 : 8 : site of Kiosk is about 10 metres from his Shop. 14. This Court is of the opinion that the extent of impact of the Kiosk on the business of the petitioner is a matter that would require the consideration of the respondents. The Estate Officer, who has passed Ext.P5, has not paid attention to this aspect. In the circumstances, the writ petition is disposed of directing the Managing Director of the 1[st] respondent-KSRTC to consider the issue whether the starting of a Kiosk at the location now proposed would adversely affect the petitioner’s bakery business and to take appropriate decision in this regard, within a period of two months. The interim order passed by this Court on 30.01.2018 will continue to enure to the benefit of the petitioner till a decision is taken as directed above. Sd/- **N. NAGARESH, JUDGE** aks/09.02.2021 WP(C) No.41641/2017 : 9 : ## **APPENDIX** **PETITIONER'S EXHIBITS:** **EXHIBIT P1** **A TRUE COPY OF THE TENDER NOTIFICATION DATED 5.1.2016.** **EXHIBIT P2** - **A TRUE COPY OF THE LICENSE AGREEMENT ENTERED INTO BETWEEN THE PETITIONER AND THE CHAIRMAN AND MANAGING DIRECTOR OF KSRTC.** - **EXHIBIT P3 A COPY OF THE BROCHURE LEAFLET OF THE KSRTC INVITING SHOPS TO INVEST.** - **EXHIBIT P4** - **TRUE COPY OF THE LICENCE ENTERED INTO BETWEEN THE PETITIONER AND THE DISTRICT TRANSPORT OFFICER, KSRTC.** - **EXHIBIT P5** - **TRUE COPY OF THE ORDER NO.ES 6/022610 DATED 29.9.2020.** - **EXHIBIT P6 TRUE COPY OF THE LICENCE IS RENEWED FOR A PERIOD OF 2 YEARS FROM 2.11.2020 TO 31.10.2022** - **RESPONDENTS' EXHIBITS:** - **EXHIBIT R1** **TRUE COPY OF THE ORDER PASSED BY THE 1ST RESPONDENT IN THE WRIT PETITION DATED 29.9.2020** SR