Laqshya Media Pvt. Ltd. and Mr. Alok Jalan Vs State of Maharashtra and Others

J.N. Patel, J.@mdashHeard the learned Counsel for the parties. The learned Counsel for the respective respondents waive service.

2. Rule returnable forthwith. By consent of the parties heard finally at the admission stage.

3. The learned Counsel for the parties submit that affidavits in reply and their submissions made at the stage of admission be treated as their respective pleadings on merits and in view of the fact that the petition relates to challenge to the grant of contract to respondent Nos. 4 and 5 in respect of the subject matter of the petition i.e., awarding the contract to the respondent Nos. 4 and 5 by respondent No. 2 by issuing work order, the matter requires to be disposed of expeditiously.

4. The petitioners have invoked the extra- ordinary jurisdiction of this Court under Article 226 of the Constitution of India for seeking a writ of mandamus in the nature of direction to the 2nd respondent to invite fresh tenders from the public by terminating the work orders and/or contracts awarded to the 4th and /or 5th respondents under the tender and to restrain the 2nd and 3rd respondents from extending and/or modifying the terms of the work orders / contracts awarded to the 4th and /or 5th respondents under the tender and/or from taking any steps or action in furtherance of or pursuant to the same along with interim reliefs ancillary to substantive reliefs sought in the petition.

5. It is the case of the petitioners that on On 31st March 2005, the 2nd Respondents floated the Tender No. AGM(C) / 102 / 2005 for awarding contracts of Sole Agency for Advertisement Rights on Bus Queue Shelters in Brihan Mumbai (2005 - 2008) issued in March 2005 (the "Tender"). The 2nd Respondents laid down strict eligibility criteria for participation therein. For operational ease, the entire area of Brihan Mumbai was divided into three lots viz. the Lot I - Eastern Suburbs, Lot II - the Western Suburbs and Lot III - the City. Tenderers were required to offer lump- sum display charges for the period of the contract, i.e. till December 2008. The tenders received would be evaluated on the basis of total lump sum display charges offered by the tenderers for an individual lot. The contract would be awarded for individual lots to different agencies depending on the offers received.

6. Clause 13 of the ''Instructions to Tenderers'' and Clause 1(c) of the ''Conditions of Contract'', which formed part of the Tender documents provided for the commencement and period of the contract. Under these Clauses, although the date of commencement of Contracts awarded under the Tender may be different, for administrative reasons, it was decided to end all successive contracts on one single date i.e. 31st December 2008 irrespective of the date of commencement of an individual lot. Thus the operative period of individual lots would be different. The Clauses specifically provided that:

The contract may be extended on the same terms and conditions of this contract on receipt of written request from the Agency. Such a request shall be strictly submitted to the Undertaking (the 2nd Respondents), at least six months in advance of the date of expiry of that Contract. However the contract may be extended at the option of the Undertaking for a term of three months on each occasion for a total period not exceeding one year.

Thus even if the contracts were to be extended for the maximum period, all the contracts under the Tender would have to come to an end latest by 31st December 2009.

7. It is the case of the petitioners that the petitioners also participated in the said tender for awarding contracts of sole agency for advertisement rights on Bus Queue Shelters in Brihan Mumbai. But, as the 4th respondent Bennett Coleman & Co. Ltd., were the highest bidders for Lot II - the Western suburbs and Lot III - the City, viz., the 5th Respondents, Prithvi Associates as the highest bidders for Lot I - Eastern Suburbs, the tender came to be allotted in favour of respondent Nos. 4 and 5. According to the Petitioners, though the respondent Nos. 4 and 5 were successful bidders, no contract/agreement was signed between the 2nd respondent and 4th and 5th respondents and that the tender came to be allotted on the basis of acceptance letters / work orders issued by the 2nd respondents which was contrary to Clause 24 of the Conditions of Contract.

8. It is the case of the Petitioners that in December 2006, the 2nd respondent thereafter floated the offer document for erection of Bus Queue Shelters in place of existing Bus Stop Pole and Display of Advertisement thereon, under ''First Finder Scheme''. (the "Scheme "). The 1st Petitioners tendered their bid for the Scheme also and were awarded a Contract in respect of 22 existing Bus Stop Poles on or about 11th December 2006.

9. In January 2007, the petitioners learnt that apart from the fact that no formal agreements had been signed between the 2nd respondent and the 4th and 5th respondents, in respect of awarding contracts of sole agency for development rights on Bus Queue Shelters for the period 2005 to 2008, as per the tender floated on 31st March, 2005, their tenders have already been arbitrarily considered for extension or had already been extended for a period of 10 years. According to the petitioners, this was going to be done/ had been done privately and unilaterally, without inviting fresh tenders from the public or even from the unsuccessful bidders under the tender and that this had been done clandestinely as a special favour to the 4th and 5th respondents taking advantage of the fact that the work orders awarded to them under the tender only provided for display of advertisements on existing old Bus Queue Shelters whereas the contract awarded under the Scheme provided for erection of brand new Bus Queue Shelters (in place of existing Bus Stop Poles), It was apprehended that the new Bus Queue Shelters constructed in place of the bus poles would be more modern, attractive and well constructed compared to the old existing Bus Queue Shelters under the tender, and, therefore, the 4th and 5th respondents should also be permitted to upgrade and modernise the existing Bus Queue Shelters.

10. It is the case of the Petitioners that the tender having been called only for display of advertisement on existing Bus Queue Shelters till 31st December 2008, not only is an unilateral extension thereof an act of arbitrariness and discrimination, but an extension coupled with the permission to erect new Bus Queue Shelters in place of the old ones, or renovate / modernise the existing Bus Shelters, clearly purview of a fresh tender and, therefore, according to the petitioners, the 2nd respondent in the guise of extension have favoured the 4th and 5th respondents by granting them a lengthy extension and/or new benefits under the original tender. Therefore, on coming to know about the aforesaid arrangement, the petitioners addressed a letter dated 31st January 2007 to the 2nd respondent putting forth its apprehension regarding the extension of the tender by pointing out that in view of Clause 13 of the ''Instructions to the Tenderer'' the contracts awarded to the 4th respondent could not be extended for more than a period of one year (i.e., till 31st December, 2009). A clarification was sought with respect to the said issue. (Exhibit "B" is the copy of the said letter dated 31st January, 2007 annexed to the petition). The 2nd and 3rd respondents failed to give any response to the letter dated 31st January, 2007 and, therefore, the 1st petitioner made an application dated 12th March 2007 addressed to the 3rd respondent under the Right to Information Act, 2005 seeking information with regard to the contract granted to the 4th respondent under the tender and the period of such licence. They further sought information regarding all contracts or agreements entered into by and between the 2nd and 4th respondents and/or extension / renewal letters or any other correspondence which had ensured between the parties. The petitioners have annexed the same as Exhibit C to the petition. According to the petitioners the Chief Engineer (Civil) and the Public Information Officer of the 2nd respondent replied to the said application by his letter dated 11th April 2007 inter alia stating that the preparation for the final agreement between 2nd and 4th respondents was still "in process". The 2nd respondent also made available to the petitioners two acceptance letters dated 9th June 2005, inter alia stating that the contract shall be in force upto 31st December 2008 and contended that "so far", no extension / renewal had been issued in respect of the Tender, but did not deny that any such extension has been considered. It is the case of the Petitioners, that though the 1st Petitioner has also requested for copies of letters regarding the proposed extension, this request was conveniently ignored and the entire reply of the 2nd Respondents thus lacks transparency and is very vague. It did not allay the misgivings of the 1st Petitioners regarding the proposed illegal extension of the ''work orders''. The Petitioners have relied upon the correspondence and have annexed the same to the petition as Exhibit D, E & E-1, i.e. copies of the 2nd Respondent''s letter dated 11th April 2007, and two Acceptance letters dated 9th June 2005, respectively. Therefore, the Petitioners by their letter dated 26th April 2007, to the Chief Engineer (Civil) and the Public Information Officer of the 2nd Respondents, recorded the visit by their authorised representative to the 2nd Respondents'' office to collect the relevant documents. At that time, the Petitioners'' representative was informed by Assistant Engineer Mr. Kunkalkar that only a ''work order'' had been signed with the 4th

Respondents and that "As an explanation, the Assistant Engineer informed her that due to changes required by the Parties the Contract / Agreement were still under process", that the 4th and / or 5th Respondents had only been issued a ''work order'', and further that there was no other correspondence which had ensued between the Parties. The 1st Petitioners pointed out that this was an incomplete and unacceptable in reply to an application under the Right to Information Act, 2005, and asked for true and correct information on the issue of which no reply has been received from the 2nd Respondent. The Petitioners have placed reliance on the letter dated 26th April 2007 which has been annexed to the petition as Exhibit "F". Thereafter the Petitioners pursued the matter with Respondent Nos. 2 and 3 but as they did not receive proper response, they chose to challenge the award of tender to Respondent Nos. 4 and 5 by the Respondent Nos. 2 and 3. According to the Petitioners, the action of the respondents in negotiating for extension of the said works order without issuing tenders and their actions in refusing to act in fair and transparent manner or to disclose their intentions are arbitrary, discriminatory, illegal, mala fide, contrary to the terms of the Tender and a violation of the fundamental rights of the Petitioners thereby depriving the Petitioners of their fundamental rights as guaranteed by Article 19(1)(g) of the Constitution of India and, therefore, they have sought a writ of mandamus against the Respondents as prayed.

11. It is the case of the Petitioners that it was incumbent upon the 2nd and 3rd Respondents in their public character and under the law not to extend the ''work orders'' awarded to 4th and / or 5th Respondents under the Tender and,if required,to invite fresh tenders from the public for the same. The Petitioners submit that in the premises, this Hon''ble Court be pleased to issue a Writ of Mandamus or a Writ in the nature of Mandamus or any other appropriate writ or direction to direct the 2nd Respondents to invite fresh tenders from the public on termination of the ''work orders'' awarded to 4th and / or 5th Respondents under the Tender.

12. It is the case of the Petitioners that this Hon''ble Court be pleased to issue a Writ of Prohibition or a Writ in the nature of Prohibition or any other appropriate writ or direction to permanently restrain the 2nd and 3rd Respondents from extending the ''work orders'' awarded to 4th and / or 5th Respondents under the Tender or from taking any steps or action in furtherance of or pursuant to the same.

13. The Petitioners submit that they have already suffered harm, loss and injury due to the fact that the ''work orders'' under the Tender were awarded to 4th and / or 5th Respondents. The Petitioners further submit that a wrongful extension of the said ''work orders'' by the 2nd Respondents will cause the Petitioners to lose out on the chance to bid for the same again and thereby cause further harm and loss to the Petitioners. Such action will also cause a loss of public revenue. The Petitioners have learnt that 2nd and 3rd Respondent propose to extend the said ''work orders''. The Petitioners therefore submit that pending the hearing and final disposal of this Petition this Hon''ble Court be pleased to issue a temporary injunction to restrain the Respondents from extending the ''work orders'' awarded to the 4th and / or 5th Respondents under the Tender or from proceeding further with any proposed extension of the said ''work orders'' which may have been initiated by them or from taking any steps or action in furtherance of or pursuant to the same. The Petitioners submit that the 2nd Respondents must invite fresh tenders from the public in light of the facts mentioned hereinabove. The Petitioners therefore submit that the balance of convenience is in favour of the 1st Petitioners being granted the interim reliefs sought.

14.. In response to the notice, Respondent No. 2 filed affidavit of S.A.Kaikini, its Chief Engineer(Civil) in order to explain their stand relating to the subject matter of the petition. It has been submitted that the Petitioners have deliberately misconstrued and confused the contracts granted under the "First Finder" Scheme, and earlier contracts to display advertisements on existing Bus Shelters. Under this scheme, there is no question of competitive bidding, and parties are free to choose the specific Bus Stops they wish to develop. In fact, Petitioner themselves selected 22 bus stops under "First Finder" Scheme without competitive bidding. Respondent Nos. 4 and 5 who, under their earlier licenses/contracts dated 9/6/2005 and 4/7/2005 respectively had secured the right to advertise on existing bus shelters which valid till 31/12/2008 were invited by the Respondent No. 2 as suggested by the BEST Committee to participate in the "First Finder" Scheme with reference to the existing bus shelters under their control., for modernizing the same.

15. It is the case of the Respondent No. 2 that the Government of Maharashtra has constituted an Empowered Committee under the Chairmanship of the Chief Secretary to monitor the progress of implementation of Mumbai Transformation Project. The Empowered Committee''s Meeting which was held on 2nd September 2006 and which meeting was chaired by Dr. D.K.Shankaran, Chief Secretary, Government of Maharashtra and was attended by the highest ranks of Civil Servants namely, Mr. Ashish Kumar Singh, Secretary to Minister for Legal Affairs, Govt. of India, Mr. R.Tiwari, Principal Secretary, UDD- I, Mr. J.M.Patak, Principal Secretary - UDD- II, Mr. Subodh Kumar - Principal Secretary Finance, Mr. Ramanath Jha, M.D., MSRDC, Mr. V.K. Jairath, Secretary (Industries), Mr. S.S.Kshatriya - Secretary (Housing) Mr. Johny Joseph - Municipal Commissioner, MCGM, Mr. G.S.Gill, Principal Secretary Home (Transport) and host of other high rank officers. Its Agenda item 2(v) referred to beautification of bus shelters. Item No. (6) of the said Minutes of Meeting referred to presentation made on bus shelters and the approval of the model of Modern Bus Queue Shelters presented by the BEST.

16. It is the case of the Respondent No. 2 that pursuant to the directions from the Secretary (Spl.Project), Government of Maharashtra, as per the decision recorded in the aforesaid meeting dated 2nd September, 2006 of the Empowered Committee, the Respondent No. 2 obtained prior approval from the BEST Committee vide BCR 474 dated 07.12.2006 for erection of Bus Queue Shelters in place of bus stop poles and display of advertisements thereon. The idea was to call for bids to develop the Bus Queue Shelters on the basis of "First Finder" Scheme. Interested parties, such as the Petitioners, could bid for as many Bus Stop Poles as they may wish to develop, and were free to choose any location they preferred. Consequently, in implementation of this "First Finder Scheme", the Respondent No. 2 in the month of December, 2006 offered to interested persons documents for erection of Bus Queue Shelters in place of the existing bus stop pole. There about 2,384 bus stop poles at different locations, as can be seen from Annexure- B to the said offer document.

17. It is the case of the Respondent No. 2 that in response to the offer put by the Respondent No. 2, the Petitioner and other 12 parties came forward with their proposal for constructing/erection of Modern Bus Queue Shelters, in place of existing Bus stop poles, the details thereof are as under:-

It is the case of the Respondent No. 2 that all the 13 parties were allotted with the work of construction of modern bus queue shelters. It is the case of the Respondent No. 2 that against the availability of 2,384 bus stop poles available under the "First Finder" Scheme, the Respondent No. 2 as of now was able to award only 483 bus stop poles and that too, to 13 different parties. Admittedly, the Petitioners had submitted a proposal for construction of modern bus queue shelter under the "First Finder''s Scheme", and were successful in getting 22 BEST bus stop poles. It is a well known fact that under the "First Finder" Scheme, there is no tender procedure and the party who brings their proposal first are entitled for the work under the said Scheme. Admittedly, out of the huge number of bus poles, the Petitioner successfully bid only for 22 bus stop poles. It may be noted that the construction cost of modern Bus Queue Shelter of the length of 18ft is over Rs. 3 Lakhs per bus queue shelter, which is to be borne by the interested parties.

18. It is the case of the Respondent No. 2 that the BEST Committee vide BCR 507 dated 27.12.2006 had approved the proposal of the above named parties under the "First Finder" Scheme. It is the case of the Respondent No. 2 that since the "Mumbai Transformation Project" related to entire Mumbai, the BEST Committee, while approving the above said proposals, also suggested to the Respondent No. 2 should invite proposal from the Respondent Nos. 4 and 5 who held all bus queue shelters in eastern, western suburbs and the city till the year 2008 in case they desired to construct the modern Bus Queue Shelter in place of old Bus Queue Shelters under their respective jurisdiction. Accordingly, the Respondent No. 2 had communicated the BEST Committee''s suggestion to Respondents 4 and 5 and requested for their proposal in the prescribed format.

19. It is the case of the Respondent No. 2 that the Respondent Nos. 4 and 5 had existing licenses with the Respondent No. 2 in respect of display of advertisements on existing BEST Bus Queue Shelters. The Respondent No. 4 is in possession of 702 Bus Queue Shelters in the western suburbs (Lot No. II) and 717 bus queue shelters in the city zone(Lot No. III) under Work Order dated 9/6/2005.Respondent No. 5 is in possession of 724 bus queue shelters in the eastern suburbs (Lot - I) under Work Order dated 14/7/2005. As per the original terms of the licenses, they were valid upto 31st December 2008 with option to renew upto 31st December 2009. Since the idea of the Empowerment Committee was to implement the Mumbai Transformation Project, it was felt that all Bus Queue Shelters, in the city should be modernized including those where Respondent Nos. 4 and 5 were operating.

20. It is the case of the Respondent No. 2 that pursuant to the BEST Committees'' suggestion communicated to Respondent Nos. 4 and 5, Respondent Nos. 4 and 5 expressed their interest in constructing modern Bus Queue Shelters as per the model approved by the Empowered Committee in place of existing Bus Queue Shelters which were under their contract. However, they were interested in developing only some of the existing Bus Queue Shelters under their contract, and not others. The details are as under:

21. It is the case of the Respondent No. 2 that the Respondent Nos. 4 and 5 contended that the rest of the Bus Queue Shelters were non- saleable from the point of advertising revenue, and the construction of the said Bus Queue Shelters was therefore not economical for them. The Respondent No. 2 refused the said suggestion of the Respondent Nos. 4 and 5 of developing only certain Bus Queue Shelters. Thereupon, series of meetings were held between the parties and in the communication dated 25.05.2007, the Respondent No. 4 while recording their consent to, reconstruction of all Bus Queue Shelters (except few) placed certain further terms and conditions for the approval of the Respondent No. 2. I say that Respondent No. 5 also vide their letter dated 14.5.2007 submitted similar conditions.

22. It is the case of the Respondent No. 2 that thereafter there were further meetings and discussions. As majority of the said Bus Queue Shelters were non- salable from the point of advertisement revenue, and even the length of the majority of said Bus Queue Shelters was more than 18 ft. and some of them were of varying length of 24ft, 30ft, 36ft, 42ft .........and also of nonstandard length, the Respondent Nos. 4 and 5 insisted on reconsideration of certain conditions as suggested by BEST Committee.

23. It is the case of the Respondent No. 2 that the proposal of the Respondent Nos. 4 and 5 was put to the BEST Committee for its consideration with all relevant documents and details. BEST Committee, in its meeting dated 12.06.2007 after detailed discussion, approved the proposal of Respondent Nos. 4 and 5 with certain modifications of the terms and conditions. They observed that Respondent Nos. 4 and 5 are paying display charges at the increased rate immediately w.e.f. 1.10.2007 onwards, irrespective of the fact that Respondent Nos. 4 and 5 had an existing license/contract upto 31.12.2008 renewable till 31.12.2009. This result in increased revenue to BEST Undertaking to the tune of Rs. 69 lakhs per month.

24. The details of display charges payable by the Respondent Nos. 4 and 5, are as under:

It is the case of the Respondent No. 2 that the aforesaid contract is for a period of 15 years w.e.f. 01.10.2007 and the Respondent Nos. 4 and 5 are liable to pay the increased rate of display charges as per the renewed terms inspite of the fact that the Respondent Nos. 4 and 5 are yet to construct the said new modern Bus Queue Shelters and inspite of the fact that Respondent Nos. 4 and 5 have a valid existing license for display of their advertisement in all those bus queue shelters till 31st December 2008 renewable till 31st December 2009 at the old rate .

25. It is the case of the Respondent No. 2 that pursuant to the approval accorded by the BEST Committee vide its meeting dated 12th June, 2007 the Respondent No. 2 vide their letter dated 19.06.2007 awarded the contract to Respondent Nos. 4 and 5 for the reconstruction of modern Bus Queue Shelters at the place of existing ones, as per the design as approved by the Empowered Committee. The size of such Bus Queue Shelter at no circumstances was to be less than the existing Bus Queue Shelter. It has been made clear to the Respondent Nos. 4 and 5 respectively that they could not display advertisements w.e.f. 01.10.2007 on those Bus Queue Shelters which they were not going to reconstruct under the new contract. Respondent Nos. 4 and 5 have been given the right to display the advertisement for 15 years on such Bus Queue Shelters but, however, on payment of display charges at the aforesaid rate as approved by the BEST Committee.

26. It is the further case of the Respondent No. 2 that the contract has been already awarded for reconstruction of the Bus Queue Shelters on the terms and conditions approved by the BEST Committee. As such, there is no impropriety whatsoever, nor there is any illegality. Since the contract has been already awarded after following due procedures, none of the reliefs as prayed in the Petition can be granted at this stage, and the Petition is infructuous on this ground alone.

27. It is the case of the Respondent No. 2 that the Respondent Nos. 4 and 5 has an existing license which is valid upto 31.12.2008 with option to renew till 31.12.2009 at the existing license rate, whereas the Govt. of Maharashtra desired that all the Bus Queue Shelters in Mumbai should be reconstructed . The design of the modern Bus Queue Shelters are approved by the Empowered Committee, Govt.of Maharashtra, and since the Respondent No. 4 & 5 have agreed to reconstruct all the bus queue shelters (except those bus queue shelters which are situated within the Bus Stations) at their own cost, as per the model approved by the Empowered Committee, the Respondent No. 2 had awarded the said contract for 15 years w.e.f. 1/10/2007. It is the case of the Respondent No. 2 that the award letter though refers to extension of license, however, in reality, it is altogether a new contract awarded in favour of Respondent Nos. 4 and 5 w.e.f. 1.10.2007 with revised terms and conditions as well as different rates of advertisement display charges, in line with the terms and conditions of the "First Finder" Scheme which have been agreed upon by the Petitioner for the 22 bus stop poles awarded to him. Under the present contract, the Respondent Nos. 4 and 5 are required to reconstruct all the Bus Queue Shelters in the pattern approved by the Empowered Committee and also pay display charges from 1.10.2007 onwards at the revised rate. The contents of the award letter r/w various proposals submitted by the Respondent Nos. 4 and 5 makes it explicitly clear that it is an altogether new contract in line with the First Finder Scheme contracts which have been entered into with the Petitioner. It is the case of the Respondent No. 2 that the Petitioner had a choice to select his own bus stop poles, however, the Respondent Nos. 4 and 5 have been directed to reconstruct all those Bus Queue Shelters (except few) which were under their control, irrespective of the salable value of the same.

28. It is therefore case of the Respondent No. 2 that the Respondent Nos. 4 and 5 have agreed to construct at their own cost the modern Bus Queue Shelters in respect of all Bus Queue Shelters which are in their possession, except those bus queue shelters which are located inside the Bus Station Premises, irrespective of the revenue generated and/or the saleable value of advertisement in such Bus Queue Shelters. The Respondent No. 4 has agreed to construct 1344 modern bus queue shelters against the existing old bus queue shelters i.e. 640 in western suburbs (Lot II) and 704 in City (Lot III). Respondent No. 5 had agreed to construct 680 modern bus queue shelters in place of existing old bus queue shelters. The length of the said existing Bus Queue Shelters in majority of cases are much more than 18 feet and some of the Bus Queue Shelters are even of varying length 24ft, 30ft, 36 ft, 42ft...... and also of non- standard length wherein, the cost of construction will be much more than the estimated cost of Rs. 3 Lakhs. Therefore, the initial investment of the Respondent No. 4 may be around Rs. 50 crores and the said initial investment by the Respondent No. 5 may be around Rs. 25 crores. As against this, the initial investment by the Petitioner will not be more than Rs. 66 Lakhs. Moreover, the Petitioners have selected only remunerative locations which have the salable value. Therefore clearly this Respondent as well as the public of the city at large stand to gain both financially and in terms of comfort and convenience. The award of the contracts to Respondent Nos. 4 and 5 need not be interfered with. As such, on this ground alone the Petition is liable to be dismissed.

29. Therefore, what one finds from the affidavit of Respondent No. 2 is that in the event the contract being denied to Respondent Nos. 4 and 5 as prayed by the Petitioners, great prejudice and loss will be caused to the Respondent No. 2 and the revenue loss alone will be to the tune of Rs. 69 lacs per month (being the differential revenue till 2008). Moreover, passengers will be deprived of better facilities of modern bus queue shelters and the City of Mumbai will have to continue with the old bus queue shelters at least till 31/12/2008, which again will create hurdle in the Mumbai Transformation Project.

30. The Respondent No. 4 have filed their affidavit in reply and submitted that the true and correct facts are stated below:

(a) In or about March 2005, the Respondent No. 2 floated tenders for the Sole right of displaying advertisements on their already existing Bus Queue Shelters as per the list of Bus Queue Shelters. Various bidders including the Petitioners as also Respondent No. 4 and 5 participated in the bidding process.

(b) After considering the various bids submitted, the Respondent No. 2 granted the tender contract to the Respondent No. 4 for 702 Bus Queue Shelters in the Western Suburbs (Lot- II) and 717 Bus Queue Shelters in the City of Mumbai (Lot- III). Respondent No. 5 was also awarded the tender contract in the Eastern Suburbs for 724 Bus Queue Shelters . The Respondent No. 2 vide their letters dated 9th June 2005, conveyed the same to these Respondents.

(c) It is submitted by the Respondent No. 4 that subsequent to awarding the tender contract, owing to an internal restructuring of its various businesses, Respondent No. 4 requested Respondent No. 2 to accede to their request to transfer the business of sole agency for the display of advertisement on Respondent No. 2''s Bus Queue Shelters to their subsidiary, Times Innovative Media Private Limited with effect from December 1, 2006. The same was communicated vide Respondent No. 4''s letter dated 9th August 2006.

(d) In reply the Respondent No. 2 addressed their letter dated 22nd January 2007 to Respondent No. 4, acceding to their request for entering into the contract for the sole agency for the display of advertisements.

(e) The said Times Innovative Media Private Limited vide its resolution dated 31st October 2006 has changed the name of the company to Times Innovative Media Limited.

(f) It is submitted that the Advocates for the Respondent No. 4 vide their letter dated 14th August 2007 conveyed the above to the Advocates for the Petitioners for their necessary action to carry out the change of name of these Respondents in the proceedings filed before this Court.

(g) It is submitted that in or about December 2006 the Respondent No. 2 invited bids for developing Bus Queue Shelters in place of Bus Stop Poles and also displaying advertisements thereon. The process of bidding was only on the basis of "First Finder" scheme wherein the interested parties could bid for as many Bus Stop Poles as they wished to develop in any preferred locations. The said bidding process was on a "first come first served basis". The Petitioners were infact party to the bidding process and were successfully awarded development of 22 Bus Queue Poles to Bus Queue Shelters under the said "First Finder" scheme.

(h) It is submitted that it is pertinent from the above that the "First Finder" scheme is altogether distinct and different from the tender contract between Respondent No. 2 and Respondent No. 4. The Respondent No. 4 had existing licenses with the Respondent No. 2 in respect of display of advertisements on 702 Bus Queue Shelters in Western Suburbs (Lot No. II) and 717 Bus Queue Shelters in City Zone (Lot No. III). As per the terms of the license, the same was valid upto 31st December 2008, with an option to renew the same upto 31st December 2009 as per Clause 1c of the Conditions of Contract.

The said Clause is reproduced herein below:

1(c) Period of Contract :

(i) Date of Commencement of contract for the given lot/s shall be taken as the 30th day from the date of issue of acceptance letter (work order) to the Agency or the probable date of commencement mentioned hereunder, whichever is later. Since the ongoing contracts are expiring on three different dates, the date of commencement of new contracts will be different. However, for administrative reasons, it has been decided to end all successive contracts (individual lot) on one single date i.e. On 31st December 2008 irrespective of date of commencement of individual lot. Taking this into consideration, the operative period of individual given lot/s will be different. For ready reference the probable dates of commencement and period of contract for individual lot are given hereunder.

(ii) The contract may be extended on the same terms and conditions of this contract on receipt of written request from the Agency. Such a request shall be strictly submitted to the Undertaking at least six months in advance of the date of expiry of that contract. However, the contract may be extended at the option of the Undertaking for a term of three months on each occasion for a total period not exceeding one year. The decision of the General Manager in this regard shall be final and binding on the Agencies.

(i) The Government of Maharashtra had constituted an Empowered Committee under the Chairmanship of the Chief Secretary to Monitor the progress of implementation of the Mumbai Transformation Project. The Empowered Committee''s Meeting was held on 2nd September 2006. Pursuant to the BEST Committees'' suggestion communicated to Respondent No. 4 that the Bus Queue Shelters already in possession of Respondent No. 4 should also be modernized in line with modernization of the Bus Queue Poles under the "First Finder" scheme, Respondent No. 4 (then in possession and control of about 1,419 Bus Queue Shelters under the tender contract) expressed their interest in constructing modern Bus Queue Shelters as per the model approved by the Empowered Committee in place of existing Bus Queue Shelters , which were under their tender contract.

(j) It is submitted that pursuant to the suggestion of Respondent No. 2, the Respondent No. 4 expressed their intention to construct Modern Bus Queue Shelters as per the model approved by the Respondent No. 2 in place of the existing Bus Queue Shelters under their tender contract. However, the Respondent No. 4 was not inclined to develop all the Bus Queue Shelters in their possession.

(k) It is submitted that the Respondent No. 4 agreed to develop only 1014 Bus Queue Shelters from the total number of 1,419 Bus Queue Shelters allocated to them / in their possession, since the same were located inside the Bus Depots premises etc. and hence, were not saleable from the point of advertising revenue and the said construction was not financially viable for Respondent No. 4.

(l) It is submitted that, since the said proposal to modernize all the existing Bus Queue Shelters under the tender contract (excepting) those Bus Queue Shelters located inside the Bus Depots premises) involves huge investment, a serious of discussions took place between Respondent No. 2 and Respondent No. 4 which resulted in Respondent No. 4 accepting Respondent No. 2''s suggestion and placing certain additional terms and conditions thereby making the tender contract economically viable, for approval of Respondent No. 2 vide their letter dated 25th May 2007.

(m) It is submitted that the said proposal of the Respondent No. 4 was considered by Respondent No. 2 and at its meeting held on 12th June 2007, Respondent No. 2 approved the proposal of the Respondent No. 4 with certain modifications in the terms and conditions.

(n) It is submitted that under the said approval accorded by Respondent No. 2, the Respondent No. 2 extended the period of the tender contract for 15 years w.e.f. 1st October 2007, in order to make the already existing tender contract economically viable. The Respondent No. 4 will be paying the Respondent No. 2 the increased rate of display charges as per the renewed terms, despite the fact that the Respondent No. 4 is yet to construct the said new modern Bus Queue Shelters and the Respondent No. 4 is having valid existing licenses for the display of advertisements on all those Bus Queue Shelters till December 2008 and renewable till 31st December 2009 at the told contractual rates.

(o) It is submitted that subsequently the Respondent No. 2 vide their letter dated 19th June 2007 granted the Respondent No. 4 permission for reconstruction of modern Bus Queue Shelters in place of the existing Bus Queue Shelters as per the design approved by Respondent No. 2 and as per the terms and conditions stated in the said letter. It was also agreed upon between Respondent No. 2 and Respondent No. 4 that w.e.f. 1st October 2007 Respondent No. 4 could not display advertisements on those Bus Queue Shelters , which they were not going to reconstruct under the new contract viz., those located inside Bus Depot premises etc. The Respondent No. 4 have been given the right to display advertisements on such Bus Queue Shelters for 15 years, at payment of display charges at rates approved by the respondent No. 2.

31. Respondent No. 4 has further submitted that the contract has been awarded to the Respondent No. 4 on the terms and conditions as approved by Respondent No. 2 and as such there is no arbitrary decision and/or illegality and/or impropriety whatsoever. Since the contract has already been awarded on 19th June 2007, none of the reliefs as prayed for by the Petitioners ought to be granted. The petition is infructuous.

32. It is submitted by respondent No. 4 that since the Respondent No. 4 has an existing license which is valid upto 31st December 2008 with an option to renew till 31st December 2009 at the existing rates, in order to design and modernize the existing Bus Queue Shelters, the Respondent No. 4 has agreed to reconstruct all Bus Queue Shelters in their possession (except those situated within the Bus Depot premises etc.) at their own cost, as per the mode / approved by the Respondent No. 2. In view thereof the Respondent No. 4 has been awarded the contract for 15 years w.e.f. 1st October 2007.

32. It is submitted that all the reconstructed Bus Queue Shelters by Respondent No. 2 are for the greater public good and will provide world class infrastructure for this city of Mumbai. Besides providing world class infrastructure to the public at large, Respondent No. 2 earns revenue therefrom. The point of differentiation between the contract entered into by the Respondent No. 2 with the Petitioners and the tender contract is that in the former the Petitioner has a choice to select existing Bus Queue Poles of their choice and construct Bus Queue Shelters while in the latter, the Respondent No. 4 have been directed to reconstruct the already existing Bus Queue Shelters, on which the Respondent No. 4 have been displaying advertisements, at their own cost which are presently under their control, irrespective of the saleable value of the same.

33. In the premises aforesaid it is submitted that the Respondent No. 4 have agreed to construct at their own cost, the modern Bus Queue Shelters in respect of all Bus Queue Shelters which are in their possession, except those Bus Queue Shelters which are located in the Bus Depot premises irrespective of the revenue generated and/or saleable value of the advertisements on such Bus Queue Shelters.

34. It is submitted that the Respondent No. 4 has agreed to construct 1,344 i.e. 704 in City and 640 in Western Zone, Modern Bus Queue Shelters even though construction of some of the Bus Queue Shelters are not economically viable and have less saleable value and revenue earning potential therefrom. The Respondent No. 4 has even agreed to construct these Modern Bus Queue Shelters (in majority cases), which are more than 18 feet and are varying in length between 24 feet to 42 feet - 122 feet. In view thereof, cost of the construction is much more than the estimated 3 lakhs per Bus Queue Shelter, thus making the initial investment of Respondent No. 4 more than Rs. 50 lakhs. Moreover the Petitioners have entered into the contract with the Respondent No. 2 under the "First Finder" scheme wherein the Petitioners had the choice of selecting the Bus Queue Poles at preferable locations, consider the economic viability and saleable value thereof and thereafter bid for construction of the Bus Queue Shelters thereon unlike those of Respondent No. 4 who are constructing the Bus Queue Shelters at the locations allotted as per the tender contract for the benefit of the public at large.

35. It is submitted by Respondent No. 4 that subsequent to the awarding of the contract the Respondent No. 4 has also entered into subsequent contracts with various other agencies for the display of advertisements and has incurred and has allocated huge expenditures towards the erection of modern Bus Queue Shelters. In case any orders as prayed for are granted, grave harm, prejudice and irreparable loss will be caused to the Respondent No. 4.

36. It is submitted by Respondent No. 4 that if orders prayed for are granted this would not only result in loss to the Respondent No. 4 but would also obstruct and/or delay the Mumbai Transformation project and deprive lakhs of passengers from using the better facilities of modern Bus Queue Shelters at majority of Mumbai''s bus stops. The Respondent No. 4 has therefore, submitted that the petition be dismissed with costs.

37. One Mr. Ashok Soni, Partner of the Respondent No. 5 has filed his affidavit on behalf of Respondent No. 5. He has almost reiterated the pleadings of Respondent No. 4 in support of their case.

38. The Petitioners have sought leave to file a rejoinder to meet the case of the Respondents pleaded in their replies and submitted that the 2nd Respondents are guilty of suppression of material facts and are seeking to mislead this Hon''ble Court. Its actions are mala fide, arbitrary and discriminatory and deserve to be set aside in toto.

39. With respect to the submissions made in the 2nd Respondents'' Reply Affidavit, the Petitioners have submitted that the 2nd Respondents have admitted that there were two distinct proposals floated by the 2nd Respondents, i.e.

(1) The first proposal was the Tender No. AGM (C) / 102 / 2005 (the "Tender") floated by the 2nd Respondent in March 2005 for awarding contracts of "Sole Agency for Advertisement Rights on Bus Shelters in Brihan Mumbai ". It seems that the successful bidders under this Tender were the 4th Respondents, in respect of Western and City Lots, and the 5th Respondents, in respect of the Eastern Lot. The scope of the Tender was only for advertisement rights on existing, already constructed Bus Shelters.

(2) The second proposal was the First Finders'' Scheme (the "Scheme ") floated sometime in December 2006, by which the 2nd Respondents invited proposals for the "erection of Bus Queue Shelter[s] in place of existing Bus Stop Pole[s] and display of advertisement thereon". The Petitioners made an application in respect of 200 Bus Stop Poles under this Scheme and were awarded contracts in relation to 22 Bus Stop Poles. It appears that the 4th Respondents subsequently sought to transfer its advertisement rights under the Tender to its subsidiary, Times Innovative Media Pvt. Ltd. ("TIMPL") [later known as "TIML"], to which request the 2nd Respondents seem to have acceded. As far as the Petitioners are aware, the 4th Respondents / TIMPL or 5th Respondents did not participate in the Scheme as they were not interested in constructing Bus Shelters in place of Bus Stop Poles.

40. The Petitioners submitted that the Tender and the Scheme are two clearly distinct proposals and there is no question of any confusion between the two. While the Tender was floated solely for the purpose of display of advertisements on existing Bus Shelters, the Scheme was floated for the purpose of construction of new Bus Shelters in place of Bus Stop Poles and only thereafter advertisement rights thereon. The Bus Shelters under the Tender were not included within the scope of the Scheme, the Bus Stop Poles were not included within the Scope of the Tender, and there was no overlap whatsoever between the two. The Petitioners understand that the Bus Shelters under the Tender and the Bus Stop Poles mentioned in the Scheme constitute every Bus Stop in Mumbai and that there are no Bus Stops falling outside the scope of the Tender and the Scheme. The following is a tabular representation of the relevant details in respect of the Tender and the Scheme:

41. It is submitted by the petitioners that it now appears that the 2nd Respondents are seeking to mislead this Hon''ble Court and the general public by mixing up, overlapping and confusing the Tender and the Scheme by purporting to permit the 4th Respondents / TIMPL and the 5th Respondents to modernise and reconstruct new Bus Shelters in lieu of the existing Bus Shelters, under the Tender (although they were permitted only advertisement rights), purportedly on the same basis as the Scheme. However, the Petitioners submit that a bare perusal of the terms and conditions upon which the purported modernisation / reconstruction rights have been arbitrarily granted to the 4th Respondents / TIMPL and 5th Respondents (without inviting any fresh tenders therefore or permitting other interested parties, including the Petitioners, to participate), clearly demonstrates that such grant falls neither within the domain of the Tender, nor is the same in line with the Scheme. In fact, the terms and conditions upon which the said rights have been granted to the 4th Respondents / TIMPL and 5th Respondents make it strikingly evident that it is a new contract and should have been the subject of a fresh tender. It is clear that special treatment and favours have been granted to the 4th Respondents / TIMPL and 5th Respondents by the 2nd Respondents by way of a fresh contract containing additional benefits and lengthy extensions. The following is a tabular representation of the additional benefits that the 4th Respondents / TIMPL and 5th Respondents enjoy under the terms of the fresh contract, as compared to the Scheme (which the 2nd Respondents contend is the basis on which the fresh contracts were awarded).

42. It is submitted by the petitioners that it is evident from the abovementioned facts that the 2nd Respondents and the 4th Respondents / TIMPL and 5th Respondents are colluding to illegally benefit and favour the 4th Respondents / TIMPL and the 5th Respondents. At the outset, the 2nd and 4th Respondents / TIMPL and 5th Respondents together have arbitrarily deemed hundreds of Bus Stops as "non- saleable". This categorization has been introduced without any justification whatsoever and no reasonable or rational basis has been put forth by the Respondents for the same. Having created this category of "non- saleable" Bus Stops, the 2nd Respondents have further favoured the 4th Respondents / TIMPL and 5th Respondents by allowing them to pay a mere pittance as display charges in this respect. First, the "[r]evenue to be earned from ''non- saleable''" Bus Stops is calculated by taking into account the purported revenue to be earned from June 1, 2007 to December 31, 2009. It is evident therefore that 2nd Respondents along with the 4th Respondents / TIMPL and 5th Respondents have taken for granted the extension of their advertisement rights under the Tender for the maximum period of 1 year, with complete disregard to the necessary procedure for extension as laid down therein. Moreover, it is submitted that the display charges for the "nonsaleable" shelters are fixed at so low a rate that it would actually result in huge revenue losses for the 2nd Respondents to the benefit of the 4th Respondents / TIMPL and the 5th Respondents.

43. It is submitted by the petitioners that in fact, from the 4th Respondents letter addressed to the 2nd Respondents dated August 9, 2006, it is clear that negotiations have been conducted between the 2nd Respondents and the 4th Respondents / TIMPL and 5th Respondents much before the "Empowered Committee" made its suggestion regarding beautification of Bus Shelters in September 2006, further highlighting the collusion between the Respondents. Once again, all decisions in respect have been made without following any procedure whatsoever and without giving the Petitioners, or any others, a chance to participate.

44. It is the case of the Petitioners that there is no excuse for the 2nd Respondents to arbitrarily and discriminatorily award fresh contracts for modernisation / reconstruction of Bus Shelters without inviting fresh tenders merely because the "Mumbai Transformation Project" extended to the "whole of Mumbai ". It is the case of the Petitioners that the BEST Committee had no authority whatsoever to grant the right of modernization / reconstruction of existing Bus Shelters without following a fair and proper procedure and providing other interested parties an opportunity to participate and bid for the same, much less single out the 4th Respondents / TIMPL and 5th Respondents for favourable and partial treatment in this respect. Given that the Tender was only for the display of advertisements on existing Bus Shelters and not for the modernisation / reconstruction of the Bus Shelters, a fresh tender should have been issued by the 2nd Respondents for the award of modernisation / reconstruction rights. It is the case of the Petitioners that this was a fresh contract and not a mere modification of minor terms of the Tender. Therefore, the Respondent No. 2''s decision to unilaterally grant special privileges and treatment to the 4th Respondents / TIMPL and 5th Respondents is illegal and arbitrary to the detriment of the Petitioners and the other Tenderers under the Scheme. Such conduct of the 2nd Respondents is clearly in violation of the principles of justice, equity and fair play.

45. The Petitioners submitted that under the Tender, the 4th Respondents / TIMPL and 5th Respondents were only allowed to display advertisements on existing Bus Shelters for a maximum period of approximately 4 years. It did not extend to the modernisation / reconstruction of existing Bus Shelters and that too for an extended period of 15 years from a belated date of October 1, 2007. In fact, the 2nd Respondent has admitted that such grant of rights is the subject-matter of a new tender / contract by stating that "in reality, it is altogether a new contract awarded in favour of the [4th and 5th Respondents]" and a fresh tender should have been issued. The 2nd Respondents have wrongly contended that the terms and conditions of such award of rights is "in line with the terms and conditions of the ''First Finder'' Scheme", which contention is clearly incorrect to the 2nd Respondents'' knowledge and denied. As borne out by the tabular statement at Paragraph 41 above, the terms and conditions of award of the modernisation / reconstruction rights to the 4th Respondents / TIMPL and 5th Respondents differ significantly from and are far more favourable to them than those under the Scheme, in respect of:

a) Period of Contract - The 4th Respondents / TIMPL and 5th Respondents have been granted modernization / reconstruction rights for 15 years with effect from October 1, 2007, i.e. up to the year 2022, while all other Tenderers under the Scheme have been granted contracts for a period of 10 years, i.e. up to approximately 2017.

b) Period for Construction of Bus Shelters - The 4th Respondents / TIMPL and 5th Respondents have been given 30 months for the modernisation / reconstruction of the Bus Shelters, while all other Tenderers under the Scheme have been given 180 days (6 months) with a maximum 90 days (3 months) extension for the purpose.

c) Material to be used for Bus Shelters - The 4th Respondents / TIMPL and 5th Respondents have been allowed to ''galvanized chrome'', which is a cheaper and inferior material in order to minimize cost, in comparison to stainless steel, which all the other Tenderers under the Scheme are required to use.

d) Payment of Display Charges - The 4th Respondents / TIMPL and 5th Respondents have been allowed to pay Display Charges over the year in monthly installments while other Tenderers under the Scheme have to pay the full yearly amount in advance, on the first day of every year of contract.

e) Categorization of Bus Stops - The 4th Respondents / TIMPL and 5th Respondents have been allowed to deem hundreds of Bus Stops as "non- saleable" Bus Stops, while no such differentiation exists in the Scheme.

f) Display Charges - The 4th Respondents / TIMPL and 5th Respondents have been allowed to pay a significantly lower rate of display charges upon the Bus Stops, which have been deemed "non- saleable". Display charges in this respect for a period of 15 years are calculated on the basis of revenue to be earned for a mere period of approximately 1.5 years. Furthermore, display charges in this respect are not subject to any increase whatsoever for the entire period of 15 years.

g) Security Deposit - As more particularly set out in the tabular statement in Paragraph 6 above, the 4th Respondents / TIMPL and 5th Respondents are not required to make a Security Deposit as per the terms of the Scheme [@ Rs. 1,80,000/- , Rs. 1,44,000/- and Rs. 1,20,000/- per Bus Stop in the City, Western and Eastern Lots respectively]. On the contrary, a much lower amount, purportedly paid under the ''on going contract'' has been accepted by the 2nd Respondents from the 4th Respondents / TIMPL and 5th Respondents as Security Deposit.

The 4th Respondents / TIMPL and 5th Respondents have been awarded a fresh contract altogether and they have further been allowed to pick and choose which Bus Shelters they would actually modify and reconstruct. The 2nd Respondents have sought to justify the grant of modernisation / reconstruction rights to the 4th Respondents / TIMPL and 5th Respondents on the purported basis that the initial investment of the 4th Respondents / TIMPL Respondents "may be around Rs. 50 crores" and that of the 5th Respondents "may be around Rs. 25 crores". Even assuming the same to be true, the Petitioners state that had the 2nd Respondents allowed the Petitioners and others to participate, they would also have been happy to make similar and even greater investments. The Petitioners therefore submit that no fair or proper procedure has been followed by the 2nd Respondents in the award of the said rights and the same is therefore a mala fide, illegal and arbitrary exercise of power.

46. The Petitioners have denied that any prejudice or loss will be caused to the 2nd Respondent in the event the contract is denied to the 4th Respondents / TIMPL and 5th Respondents or that revenue loss as alleged will be caused. In fact, had the 2nd Respondents invited fresh tenders as required by law, it is more than likely that they would have been able to obtain a far greater revenue for the purpose. It is the case of the Petitioners that the 2nd Respondents, as a state undertaking, are bound to follow the rules of justice and fair play and an opportunity ought to be given to everyone to participate and the 2nd Respondents cannot award the contract by private negotiation. It is therefore in the public interest to follow fair procedures in awarding public contracts, and the same not having been observed, the modification and extension of the work orders / additional grant of rights is liable to be struck down.

47, The Petitioners further submitted that the 2nd Respondents have wilfully suppressed material facts and at every stage failed to disclose relevant information to the Petitioners as well as the Hon''ble Court. The Petitioners state an Advertisement was issued by TIMPL on or around August 1, 2007, inviting ''Expression of Interest'' from reputed and recognized fabricators / contractors / manufacturers for "fabrication and erection of approximately 1200 - 1500 Bus Queue Shelters in place of existing BEST BUS stop poles in Mumbai ".

48. It is submitted by the petitioners that despite addressing letters to the 2nd Respondent and TIMPL, seeking information in relation to the advertisement, the Petitioners have not been informed of the basis of the said advertisement and it is thus far unclear whether the same falls within the purview of the Tender or the Scheme and no information in this respect has been forthcoming from either the 2nd Respondent or TIMPL. In fact, by a belated letter dated August 31, 2007 the 2nd Respondent has refused to comment stating that the same "is [] the subject matter in the [present] Petition" and that "it may not be legally appropriate to accede to the request made by you, pending the aforesaid Petition". It is therefore submitted that the 2nd Respondents should be called upon to provide particulars / information / relevant documents in relation to the Tender.

49. The Petitioners therefore submitted that the entire conduct of the 2nd Respondent belies its mala fide intent, arbitrariness and the special treatment and favours granted to the 4th Respondents / TIMPL and 5th Respondents and therefore renders its action in this respect illegal.

50. It is submitted by learned Counsel for the petitioner that the Petitioner by this Petition is seeking to invoke the power of judicial review by this Hon''ble Court in awarding contracts to Respondent Nos. 4 and 5. These contracts have been awarded by the Respondent Nos. 2 and 3 who are the statutory authorities under the B.M.C. Act. The Respondent No. 3 is the General Manager of the BEST Undertaking (Respondent No. 2). The Act confers special powers upon the General Manager and the BEST Committee to administer and manage the undertaking by a separate chapter in BMC Act. Respondent No. 3 is normally an I.A.S. Officer and heads the Undertaking. The Legislature has conferred special powers upon Respondent No. 3 in departure from the general scheme of the B.M.C. Act.

51. Per contra it is submitted by the learned Counsel for Respondent No. 2 that in entertaining and deciding a Petition of this nature, three principal questions will arise for consideration:

I. Whether the Respondent Nos. 2 and 3 have statutory powers under the Act, to take an administrative decision assailed in the present Petition (Section 460 (M) and Section 460(K)].

II. Whether the decision making process is arbitrary and irrational on the basis of Wednessbury''s principle of unreasonableness and whether the resultant decision is against the public interest.

III. Whether the fundamental rights of the Petitioners are violated as a result of the decision.

52. According to the learned Counsel for Resondent No. 2, before answering these questions, it must be realized that the Petition is filed in order to espouse commercial interests of the Petitioner and is not for any altruistic purpose. No service rendered to the members of the public by statutory body viz. BEST as a result of the impugned decision will be affected unless it is clearly shown that the Respondent No. 2 suffered on avoidable loss or could have generated better revenue.

53. The learned Counsel for Respondent No. 2 submitted that in dealing with such questions, the Apex Court has had a different approach than while dealing with disposal of property, licences and other measures which bring about monetary gain or monetary loss. Much water has flown after the decision in "Ramana Shetty" and the judicial review has been controlled by subsequent decisions and cited the following cases :

i) M.P. Oil Extraction and Another Vs. State of M.P. and Others,

ii) G.B. Mahajan and others Vs. The Jalgaon Municipal Council and others,

iii) Delhi Science Forum and others Vs. Union of India and another,

iv) 2003 (8) SCC 1005 M & T. Consultants, Secunderabad v. S.Y. Nawab and Anr.

v) Association of Registration Plates Vs. Union of India (UOI) and Others,

vi) Sterling Computers Limited and Others Vs. M and N Publications Limited and Others,

54. It is submitted that in this Petition, we are mainly concerned with a service to be provided to the passengers of bus service and erection of shelters in such a manner as to beautify the city. Primarily, this would be a task of Respondent No. 2. However, as a result of financial constraints the Respondent No. 2 decided to entrust this task to private players, in order to compensate them they were to be given advertising rights.

55. The learned Counsel for Respondent No. 2 submitted that the Mumbai Municipal Corporation Act, 1888 ("hereinafter referred to as the said Act'') contains a separate chapter, namely, XVIA in relation to Respondent No. 2 Undertaking. u/s 460A, the General Manager subject to superintendence of the BEST Committee is empowered to perform all acts necessary for economical and efficient maintenance, operation administration and development of the Undertaking. The said provision confers wide powers upon Respondent No. 3. The General Manager of the BEST Undertaking is ordinarily a Senior I.A.S. Officer having experience in administration. u/s 460K contract by Respondent No. 2 is to be made by Respondent No. 3. Section 460M imposes obligation upon the General Manager to invite tenders, if expenditure exceeding Rs. 50,000/- is to be incurred by the Undertaking. Proviso to subsection 2 of the said Section enables BEST Committee to authorize Respondent No. 3 to enter into a contract without inviting tenders or without accepting any tender which he may receive after having invited them.

The above referred provisions clearly establish that the Respondent No. 3 with the authorization of the BEST Committee is entitled to enter into a contract without inviting tenders. In the present case, there is a clear authorization by the BEST Committee for entering into the contract with Respondent No. 4 & 5. The Legislature has conferred this power upon Respondent No. 3 and the facts of the present case demonstrate that he has acted within parameters permitted by the Legislature. Since there is a statutory provisions enabling Respondent No. 3 to enter into a contract with Respondent Nos. 4 & 5, there is no illegality as such under the said Act.

56. The learned Counsel for Respondent No. 2 has justified the award of contract to Respondent No. 4 and 5 by stating that :

a) By 2005, BEST Undertaking had a wide network of bus service through the length and breadth of the city. The stops were denoted by either bus poles or bus shelters. The bus shelters were of varying lengths depending upon location, frequency, routes and number of passengers.

b) Prior to 2005, Respondent No. 2 decided to contract at advertising spaces available on bus shelters. For the said purpose they invited tenders and in the tender process Petitioner, Respondent Nos. 4 and 5 as well as others participated. Respondent Nos. 4 and 5 were successful and were awarded advertising rights over bus shelters in city, eastern and western suburbs. In all 2140 bus shelters were contracted with. Agreements were entered and were valid till 31st December, 2008 with an option for renewal by one year. At the time of contracts the scheme for beautification of Mumbai was not envisaged. Petitioners have no grievance about the award of this contract.

c) On 2nd September, 2006, the empowered committee met and decided to take various measures for beautification of Mumbai. One such measures was to have modern bus shelters throughout the city of Mumbai. Respondent No. 2 participated in the said process and desired to take measures as per the recommendation. Since immediate concern was conversion of bus poles into bus shelters, first finders'' scheme was evolved and put into operation to deal with 2384 bus stop poles. No tenders were invited and parties were awarded contracts on first come first served basis. Standardized terms were evolved in order that they will apply to different Applicants. The Scheme involved erection of bus shelters of standard 18 ft. length in place of bus poles. Inspite of wide choice being available the scheme met with a poor response and only 483 out of 2384 bus poles were applied for conversion. Even the Petitioner had applied for about 200 and was initially awarded 22 poles. There were 13 different parties who had applied for 483 bus stops, thus increasing the cost of supervision and adversely affecting timely implementation of the Scheme. The Petitioners have no grievance about the first finders'' scheme which was assailable on some of the grounds raised in the Petition.

d) In relation to the existing bus shelters, the rights had already been awarded to Respondent Nos. 4 and 5 and their contracts were to expire on 31st December, 2008. Many of these bus shelters required constant maintenance and did not offer comfort to the passengers. These shelters were of varying lengths from 12 ft to 120 feet.. The scheme for modernization would require demolition of the existing bus shelters and erection of new ones in their places. Many of these bus shelters were inside the bus depots or at places where advertising potential would be minimal. The process for beautification/modernization of these bus shelters could not wait till after January, 2009. Having regard to the experience in first finders scheme, the prospect of dealing with different parties was required to be avoided. These factors rendered the scheme for modernization of existing bus shelters, different and distinct from first finders'' scheme. To obviate the necessity of waiting till January, 2009, for implementation of the scheme, the Respondent Nos. 3 and 4, the BEST Committee, took a conscious and considered decision to seek views and participation of Respondent Nos. 3 and 4 for modernization of the existing bus stops. Respondent Nos. 4 & 5 were initially invited to modernize bus shelters on lines of "First Finder Scheme". However they were willing to participate for modernization of only 1377 bus shelters out of 2143 bus shelters. Respondent No. 2 & 3 were keen and insisting upon modernisation of all bus shelters and not only those having advertisement potential. As a result, Respondent Nos. 2 & 3 on one hand and Respondent No. 4 & 5 on the other met on several occasions and agreed for contract in present form.

e) The following circumstances required the Respondent Nos. 2 and 3 to negotiate with Respondent Nos. 4 and 5 for modernization of existing bus Shelters:

a) Timely implementation of modernization scheme which could not wait to commence till January, 2009.

b) the fact that contract had been entered into with Respondent Nos. 4 and 5 which was to expire on 31st December, 2008 with an option of renewal for one year.

c) Poor response to first finder''s scheme where out of 2384 bus poles, only 483 were taken up.

d) The necessity of converting all existing bus shelters into modern shelters irrespective of advertising potential.

e) The Respondent Nos. 2 & 3 could not discriminate between shelters having advertisement potential and those having no or minimal potential.

f) The expediency of dealing with an established contractor and not a multiple set of contractors as in first finders'' scheme.

g) Existing bus shelters having varying lengths would require different investment and could not be standardized as in the first finders'' scheme.

h) the assurance of having a regular income to B.E.S.T. from contractors over a period of time without any investment by B.E.S.T.

i) The first finders scheme was for a period of 10 years. The Contract awarded to Respondent No. 4 & 5 begins from 1st October 2007 (i.e. within the earlier contract period). The actual duration is more than the first finders'' scheme by 3 years more.

j) The Respondent No. 4 & 5 would be liable to pay under the new contract, not at the old rates under the old contract but new rates. Thus, between 1st October 2007 and 31st December 2008, B.E.S.T. stands to gain more revenue from Respondent No. 4 & 5.

k) The present contract is more advantageous to B.E.S.T. than the contract under the first finder''s scheme, from the point of view of revenue as well as swifter implementation of the scheme.

l) The investment required of the contractor under the first finders'' scheme than under the new contract is much less, since the cost of demolition of existing shelter and erecting new shelter of more than 18 feet length is substantially higher.

57. On behalf of Respondent No. 4 and 5 it is submitted that the reliefs claimed in the Petition cannot be granted and the Petitioner is infructuous and the work has already been substantially done under the contracts for the following reasons:

(i) The Petition has been filed on the 20th June 2007 on the basis that Respondent No. 2 is yet to grant/ award contract to Respondent No. 4 & 5 for construction of new Bus Queue Shelters in place of old. The prayers in the Petition seek reliefs against Respondent Nos. 2 and 3 to restrain it from awarding the contracts to Respondent Nos. 4 and 5.

(ii) It is submitted that contracts were already awarded to Respondent No. 4 and 5 admittedly on 19th June 2007 i.e. prior to the filing of the Writ Petition. The Respondent No. 2''s letters dated 19th June 2007 awarding contract to the Respondent No. 4 and Respondent No. 5 has not been challenged. The prayers/ reliefs claimed in the Writ Petition are infructuous and cannot and ought not to be granted.

(iii) If any reliefs are granted, the work already completed under the project would go waste. Serious disruption will be caused. Since the commencement of the present contract with effect from 1st October 2007 the following is the progress of construction:

(a) Respondent No. 4 has constructed about 423 Bus Queue Shelters out of the total number of Bus Queue Shelters allotted to it;

(b) Respondent No. 5 has constructed about 306 Bus Queue Shelters allotted to it.

(c) Respondent No. 4 and 5 expect to complete the entire project within about 6 months from today.

(iv) In view of the above it is submitted that the Petition be dismissed in limine on this ground itself.

58. It is further submitted by Respondent Nos. 4 and 5 that the Need - Urgency in constructing new Bus Queue Shelters and implementation of the Mumbai Transformation Project Delay would disrupt the Project and be against public interest therefore there is an urgency to replace old Bus Queue Shelters with new modern Bus Queue Shelters. The impact of modernization of Bus Queue Shelters has far reaching effect. Every day 45 lacs commuters use Bus Queue Shelters in Mumbai. About 3380 buses ply on 334 routes. Bus commuters in Mumbai are exposed to harsh sun and torrential rain. The old Bus Queue Shelters are dilapidated, leaking and do not provide adequate protection to commuters. There is no seating arrangements on old Bus Queue Shelters. The new Bus Queue Shelters are very durable having life span in excess of 20 years.

58.1. Mumbai Transformation Project, an initiative of the government, envisaged the modernization of the Bus Queue Shelters in city of Mumbai to ensure that more convenient and commuter friendly Bus Queue Shelters are installed in the city at the same time contributing to the beautification of the city.

58.2 At and around the time when it was decided to implement Mumbai Transformation Project and First Finder Scheme was launched, about 2089 of the existing Bus Queue Shelters wer already awarded to Respondent No. 4 and Respondent No. 5 for display of advertisements which contract period ran upto December 2008 and extendable for a period of further 12 months.

A fresh tender could have been invited in 2007, only by terminating the existing contract with Respondent No. 4 and Respondent No. 5 thereby resulting in breach of the contract and consequential loss to Respondent No. 4 and Respondent No. 5 leading to a claim for damages.

58.3 It is further submitted that Respondent No. 4 and Respondent No. 5 were requested to apply for modernization of the Bus Queue Shelters under the First Finder Scheme (which scheme gave an option to pick and choose the Bus Queue Shelters). Respondent No. 4 submitted an application for 1014 out of the 1419 allotted to it under the 2005 contract. Respondent No. 5 submitted an application for 363 out of the 724 allotted to it under the 2005 contract, which, if accepted, would have meant about 776 Bus Queue Shelters being left without modernization. BEST after taking several factors into account decided to ensure that all the Bus Queue Shelters are modernized at the earliest possible time, irrespective of their saleability for the purpose of advertisement and hence, awarded a contract to Respondent No. 4 and Respondent No. 5 for the same.

58.4 It is the case of Respondent No. 4 and 5 that in case any delay to the project is caused, it would severely disrupt the schedule and increase the cost of the project significantly for the following reasons:

(a) The tender process would take atleast 3 to 4 months to be completed.

(b) The successful bidder would be required to have the prototype of the Bus Queue Shelters approved/tested by the Respondent No. 2.

(c) After approval, the contractor would have to place order with manufacturer to manufacture new Bus Queue Shelters.

(d) Incidentally several states in India are simultaneously replacing old Bus Queue Shelters with new. There are only about 15 Nos. of manufacturers of Bus Queue Shelters in India who can match the quality and quantity requirements of these Bus Queue Shelters. Consequently there is a heavy burden upon the manufacturers to meet schedules. Owing to the huge demand it would be very difficult for the manufacturer to supply the Bus Queue Shelters under the new contract at short notice.

(e) considerable time will be expended to replace the old Bus Queue Shelters with new. This would considerably delay the Mumbai Transformation Project and seriously affect public interest. In particular interest of BEST commuters. It is definitely not in the interest of general public to delay the Mumbai Transformation Project.

59. The Respondent Nos. 4 and 5 have offered to explain Non Saleability of several Bus Queue Shelters. According to them the following Bus Queue Shelters were found to be non saleable and commercial unviable:

Respondent No. 4:- 120 (Western Suburb)

Respondent No. 4:- 282 (City)

Respondent No. 5:- 371 including 54 in bus station/depot (Eastern Suburb)

59.1 It is their case that the revenue earning capacity of a Bus Queue Shelters through display of advertisement depends on the location of the Bus Queue Shelters. A Bus Queue Shelters in a prime location fetches more revenue than one in a remote location. This concept of saleability and non-saleability is common in business. Bus Queue Shelters located in bylanes, bus depots, remote areas, (where there is little or no throughfare or traffic), blocked visibility, depressed areas are considered to be non saleable and/or commercially non viable as there is extremely poor or no demand at all for these Bus Queue Shelters from the advertisers.

59.2 According to them, it is pertinent to note that when the First Finder Scheme was announced by Respondent No. 2 offering 2384 Bus Stop Poles for construction into Bus Queue Shelters. Respondent 2 was only able to award 483 Bus Queue Shelters to 13 different parties even though this was on first come first basis The figure now stands at 499 - all located at prime locations. The balance could not be awarded as no party opted for them.

It is also pertinent to note that out of 2384 Bus Stop Poles the Petitioners applied for 200 of these. (Pg 196) Out of the 200 the Petitioners were awarded only 22 Bus Stop Poles. The figure now stands at 33 Bus Stop Poles for the Petitioners.

59.3 It is their case that from what is aforestated It is evident that all the applying parties (including the Petitioner) did not apply for all 2384 Bus Stop Poles as they too believed that all the locations where the Bus Stop Poles were situated were not saleable and hence commercially not viable. This itself proves that the issue of saleability of Bus Queue Shelters is critical.

60. According to Respondent Nos. 4 and 5 the benefit received by Respondent No. 2 under the present Contract can be summed up hereunder.

(A) The contracts awarded to Respondent No. 4 (dated 31st March 2005) and to Respondent No. 5 (dated 19th June 2007), was with effect from 1st October 2007 and were valid right upto 31st December 2008. The Respondent No. 4 and Respondent No. 5 were therefore well within their rights to commercially exploit these Bus Queue Shelters right upto 31st December 2008 without any hindrance or obstruction from Respondent No. 2.

Notwithstanding, this, Respondent Nos. 4 and 5 agreed to pay incremental / display charges to Respondent No. 2 under the new contract with effect from 1st October 2007 (instead of 1st January 2009) even though

(i) the contract dated 31st March 2005 was still valid until 31st December 2008 and renewable until 31st December 2009.

(ii) the new Bus Queue Shelters were yet to be constructed. Thus Respondent No. 4 and Respondent No. 5 are higher paying display charges even though they are not able to immediately commercially exploit all Bus Queue Shelters.

By virtue of the above, the Respondent No. 4 and Respondent No. 5 had conferred a benefit on Respondent No. 2 in the sum of Rs. 4,69,25,951. The details are as under:

The other benefits to Respondent No. 2 are:

Thus the total benefit derived by Respondent No. 2 is Rs. 51,20,19,024/- on the basis of Rs. 3.06 lacs per Bus Queue Shelters and Rs. 65,48,66,164/- on the basis of the costs of Rs. 4.40 lacs per Bus Queue Shelters which is the actual cost per Bus Queue Shelter , being incurred by Respondent No. 4 and 5

Note:

1. Respondent No. 4 by its letter dated 25/5/02 to Respondent No. 2 has stated that investment on additional shelters (i.e. non saleable) will be approximately Rs. 14 crores. This cost works out to Rs. 4.40 lacs per Bus Queue Shelters.

2. Respondent No. 4 and 5 in fact have bills and invoices to prove the costs incurred by them to be approx Rs. 4.70 lacs per Bus Queue Shelters.

51. The Respondent Nos. 4 and 5 have distinguished the First Finder Scheme vis-�-vis the present Contract

The First Finder Scheme has the following features:

(i) Conversion of Bus Stop Poles into Bus Queue Shelters.

(ii) It is on first come first serve basis. A party can pick and choose a bus stop pole after assessing its saleability.

(iii) There is no bidding- Fixed Display charges are required to be paid.

(ii) The sizes of the Bus Queue Shelters is standard i.e. 18'' in length.

The present contract has the following features:

1) Contract for conversion of entire fleet of Bus Queue Shelters awarded under 2005 tender to Respondent No. 4 and Respondent No. 5 (except few situated inside a bus depot).

2) No option to Respondent No. 4 and Respondent No. 5 to assess revenue potential of each of the Bus Queue Shelters.

3) All the Bus Queue Shelters are to be reconstructed irrespective of their revenue potential.

4) Sizes of the Bus Queue Shelters range from 12'' to 120'' (at additional cost which is not applicable to the First Finder Scheme allottees). Thus when taken into consideration the larger sized Bus Queue Shelters, the Respondent No. 4 is actually constructing the equivalent of 1636 Bus Queue Shelters of 18'' and not just 1349 Bus Queue Shelters. Respondent No. 5 is actually constructing the equivalent of 811 Bus Queue Shelters of 18'' and not just 680 Bus Queue Shelters.

5) Stainless steel has been used by Respondent No. 4 and Respondent No. 5.

6) A large number of the Bus Queue Shelters contain passenger lights even though the same is not mandatory by BEST design.

7) Display charges/ license fee is subject to increase of 20% after every five year.

8) The project involves the removal of the old Bus Queue Shelters and incurring the costs thereto (which are significantly higher than bus stop poles).

9) Removal of the existing Bus Queue Shelters also means additional time requirement for execution of the project.

Therefore according to Respondent Nos. 4 and 5 Comparison between First Finder Scheme and Present Contract (Petitioners comparison is misleading)

From the above it is evident that the comparison sought to be made by the Petitioner that the present contract is more beneficial than the First Finder Scheme is totally erroneous and misleading.

62. The Respondent Nos. 5 and 5 submits that considering the aforesaid Whether the projected revenue earned by the Respondent No. 2 would have been Rs. 203 crores as alleged by the Petitioner.

It is the case of the Petitioner if the First Finder Scheme display charges were applied to all 815 (including Bus Queue Shelters in bus depot/stations) non saleable Bus Queue Shelters, the Respondent No. 2 would have earned the revenue of Rs. 203 crore.

This contention is not only fallacious but only based on a speculative calculation without considering ground realities. None of the Petitioner''s calculations are placed on Affidavit.

62.1 Firstly as stated earlier the First Finder Scheme cannot be used as a yardstick to calculate Rs. 203 crs. as being the revenue that would be earned by the Respondent No. 2 (if the terms of the First Finder Scheme were to be applied to the present contract) .

(i) Under the First Finder Scheme, a party could select any bus stop pole out of 2384 poles on offer and construct the Bus Queue Shelters in place of existing bus stop pole; The party was free to select those locations which it found to be commercially viable and was not obliged to construct new Bus Queue Shelters in place of all 2384 bus stop poles.

(ii) Under the present contract the Respondent No. 4 and 5 are obliged to replace all existing Bus Queue Shelters i.e. 2024 with modern Bus Queue Shelters regardless of their commercial viability and saleability. This meant that Respondent No. 4 and 5 had to replace even the commercially non-viable 647 shelters at an additional expense of about Rs. 19.83 crs @ Rs. 3.06 lacs per Bus Queue Shelters and incur further expenditure to maintain them to 15 years. Respondent No. 4 and 5 agree to pay revenue to Respondent No. 2 on these entire 815 Shelters as per the old contract for the period October 2007 to December 2009 amounting to Rs. 13.71 crs.

Note:

1. At the inception of the contract, the cost of the Bus Queue Shelter was estimated at more than Rs. 3 lacs

(See Affidavi t of Respondent No. 2 page 187 para 18 and see Affidavit of Respondent No. 4 page 243 para 13)

2. With passage of time the cost has increased. Respondent No. 4 and 5 put forth the calculation at Rs. 4.40 lacs approx per Bus Queue Shelter. The Respondent No. 4 and 5 have bills and invoices to prove the cost of Rs. 4.40 lacs approx . per Bus Queue Shelter .

3. Even if the price escalation is taken to be Rs. 4.40 lacs per Bus Queue Shelter, the costs of construction works out to Rs. 28,46,80,000/ - .

(iii) Under the First Finder Scheme all the Bus Queue Shelters are of uniform size of 18 ft X 4 ft only. Under the present contract the size of the Bus Queue Shelters varies from 18 ft. to 122 ft. Under this Respondent No. 4 submitted a list of 432 (732) shelters in South, 582 (726) in western suburbs. Respondent No. 5 submitted a list of 363 (734) shelters in eastern suburbs to be replaced by new modern bus queue shelters, under the same terms and conditions of First Finder Shelters. The aggregate expenditure which Respondent 4 and Respondent 5 will incur due to the differentials in size of the Bus Queue Shelters will be to the tune of Rs. 12,96,48,654/- @ Rs. 3.06 lacs per Bus Queue Shelter (and Rs. 18,61,20,000/ - @ Rs. 4.40 lacs approx. per Bus Queue Shelter actually incurred by the Respondent No. 4 and 5). This is a direct benefit to Respondent No. 2, there being no additional benefit to Respondent 4 and 5.

62. Secondly if Non-Saleable Bus Shelters are taken into account the First Finder Scheme has made a greater loss - Rs. 287 crores:

(i) The revenue fetched by Respondent No. 2 under the First Finder Scheme is Rs. 80,73,12,000/- . If all the Bus stop poles had been applied for under the First Finder Scheme the BEST would have earned revenue of Rs. 367,80,48,000/- . On such an assumption (which is similar to the assumption that the Petitioner is making to arrive at a figure of loss of Rs. 203 crores), the BEST has suffered a loss of 287 crores under the First Finder Scheme (Attachment ''1'') .

(ii) On the other hand, the enclosed calculation at Attachment ''2 '' will establish that far from suffering a loss of Rs. 203 crores the Respondent No. 2 has actually gained Rs. 51,20,19,024 (where the cost of Bus Queue Shelter is calculated at Rs. 3.06) and Rs. 65,48,66,164/- (at Rs. 4.40 lacs being the approx cost of Bus Queue Shelters) incurred by Respondent No. 4 and 5.

(iii) Rs. 19,83,04,206/ - at Rs. 3.06 lacs per Bus Queue Shelters and if when calculated at Rs. 4.40 lacs per Bus Queue Shelters the amount would be Rs. 28,46,80,000/- is the cost that would be incurred by Respondent No. 4 and 5 on erection of commercially non-viable shelters and therefore were given additional 5 years to recover this cost (effectively 31/2 years). However, Respondent No. 4 and Respondent No. 5 agreed to pay revenue to Respondent No. 2 on these 815 shelters as per the old contract for period of Oct. 07 to Dec. 09 amounting to Rs. 13.71 crores. They also agreed that the new contract will start from Oct. 07, even though their old contract was to expire on Dec 08 or Dec 09 with extension of 1 year. This means that they let go the revenue they would have earned in these period of Oct 07 - Dec. 09 in lieu of the new contract.

(iv) Petitioner is claiming that Respondent No. 2 would have fetched Rs. 203 crores additional had all these 2192 shelters been given under First Finder Scheme. However the question is would anybody come forward to construct commercially non-viable shelters? Who would replace them? Hence if these 2192 shelters were considered under First Finder Scheme, then like the First Finder Scheme for poles, applicants would have taken only commercial viable shelters i.e. around 1350 and not 2192 shelters. Hence the entire premise of calculating revenue of 2192 shelters under First Finder Scheme is wrong and imaginary, as it would have been for much lesser shelters than 2192 Shelters.

(v) Hence, as per calculation shown in the Attachment 2, Respondent No. 2 has not lost Rs. 203 crores but actually gained Rs. 51,20,19,024/ - at Rs. 3.06 lacs per Bus Queue Shelters and Rs. 65,48,66,164/ - at Rs. 4.40 lacs per Bus Queue Shelters.

63. It is therefore the case of Respondent Nos. 4 and 5 that the Respondent No. 2 was entitled to award the contract to Respondent No. 4 and 5 without inviting tenders:

A public tender is not the invariable way in which the State or any public authority has to enter into contracts by citing the decision of the Supreme Court rendered in the case of

(1) In Kasturi Lal Lakshmi Reddy, Represented by its Partner Shri Kasturi Lal, Jammu and Others Vs. State of Jammu and Kashmir and Another, the Hon''ble Supreme Court of India has enunciated the rule that in a given situation if a private party comes before the state and makes an offer, the state would not be committing breach of any constitutional or legal obligations if it negotiates with such a party and enters into a such contract with such party without inviting a public tender. The following conclusions emerge from the Judgement of the Hon''ble Supreme Court of India:

(i) The predominant purpose and object of the transaction is to be seen. If in furtherance of such predominant purpose, the state felt necessary to enter into a private contract without inviting a public tender, the state was free to do so; (i) As long as the State''s conduct was bonafide and reasonable, a Court would not interfere merely on the ground that no advertisement was given or publicity made or tenders invited;

(ii) Whether or not the predominant purpose of the transaction could be sub-served by this approach, was a matter of the States policy;

(iii) If it could be shown that the state has acted malafide or out of improper practice or corrupt motive or in order to promote private interest of someone at the cost of public interest, the Court would strike down the action as arbitrary, unreasonable or contrary to public interest.

(2) In Netai Bag and Others Vs. The State of West Bengal and Others, - The following conclusions emerge from the Judgement of the Hon''ble Supreme Court of India:

(a) Non floating of tenders would not in all cases be deemed to be result of the exercise of executive power in an arbitrary manner;

(b) Constitutional Courts cannot be expected to presume alleged irregularities, illegalities or unconstitutionality nor can they substitute their opinion for the bonafide opinion of the state executive;

(c) The Courts are not concerned with the ultimate decision but only with the fairness of the decision making process.

(d) The government is entitled to make pragmatic decisions which may be necessary or called for under the prevailing peculiar circumstances;

(e) It is open to the State to make an exception and not follow the method or public auction of inviting tenders where there is a situation providing compelling reason necessitating departure from the rule.

(3) In G.B. Mahajan and others Vs. The Jalgaon Municipal Council and others, the Hon''ble Supreme Court of India has upheld the right of public authorites to enter into self financing schemes for projects by entering into agreements with developers for financing and execution. The Supreme Court held that :

(i) Decisions to undertake such schemes to be essentially matters of economic policy which lack adjudicative disposition - unless they violate constitutional or legal limits or power or have demonstrable pejorative environmental implications or amount to a clear abuse of power;

(ii) The above was judicial recognition of an administrator''s right to trial and error - as long as both trial and error are bona fide and within the limits of authority.

(iii) Judicial review did not entitle a Court to say a particular policy option was better than another.

63. In the present case therefore it is submitted that:

(a) The predominant purpose of the BEST i.e. Respondent No. 2. is the speedy construction of modern Bus Queue Shelters in replacement of all existing Bus Queue Shelters (whether saleable or non saleable). This is in the public interest and in the paramount interest of the commuters of Mumbai.

(b) Given the fact that the BEST had to evolve a means of financing the project. The BEST has in its Additional Affidavit stated that it is a loss making organization with outstanding loans to bankers with a tune of Rs. 455 crores and is not in a position to invest Rs. 75 crores for beautification of Bus Queue Shelters. The cost of construction of the 647 nonsaleable bus shelters above would have cost the BEST at least Rs. 19,83,04,206/- (at the rate of Rs. 3,06 lakhs per shelter) if not Rs. 28,46,00,000 (at the rate of Rs. 4.40 lakhs per bus shelter) or even more.

(c) To save this cost the BEST has evolved a self financing scheme which has in fact gained it at least Rs. 51,20,19,024/- if not Rs. 65,48,66,164/- (See Attachment II hereto)

(d) This is a choice made by the BEST in exercise of its economic policy.

(e) The pre-existing contract with Respondent No. 5 dated 14th July 2005 extended upto atleast 31st December 2008 with an option to extend until 31st December 2009. This contract covered 724 shelters in the Eastern Suburbs.

(f) As a matter of economic policy the BEST decided that transformation of these 724 Bus Queue Shelters should be initiated from 2007 itself rather than waiting for the expiry of the aforesaid contract.

(g) The response to the First Finder Scheme was dismal. Only 483 saleable locations were chosen out of approximately 2384 bus stop poles - the Petitioner itself chose to apply only for 200 out of the 2384 bus stop poles. Hence the non saleable locations were all left unapplied for. This position continues till today.

(h) It was thus clear that the BEST''s predominant purpose of construction of all bus shelters, including the non-saleable ones, without incurring any cost, would fail unless it was able to persuade Respondent Nos. 4 and 5 to construct all the shelters at this cost. This would necessarily require incentives.

(i) It is submitted that the aforesaid factors amongst others provides sufficient justification for the BEST''s decisions not to float a public tender (which could fail like the First Finder Scheme) but to negotiate and award the contract with Respondent No. 4 and Respondent No. 5 (parties with entrenched contracts upto 31st December 2008 or 31st December 2009). In this way the BEST was able to ensure fulfillment of its predominant purpose of construction (at no cost to it) of all Bus Queue Shelters i.e. including the non saleable ones.

(j) This policy decision is in the public interest as its main object is to provide better facilities to commuters.

(k) The approach of this Hon''ble Court ought not to be to evaluate the correctness of the BEST decision, with the benefit of hindsight and to substitute for it any other policy decision.

(l) There is no material to indicate any corrupt or malafide motive so as to promote a private interest at the cost of the State nor any abuse of power or ultra vires action. The Petitioner having failed to establish this it is respectfully submitted that this Hon''ble Court ought not to interfere what is essential an economic policy decision which is rational and not arbitrary.

64. It is the case of Respondent Nos. 4 and 5 that even otherwise Respondent No. 2 is entitled by statute not to invite tenders Section 460 (M) of the Mumbai Municipal Contract Act 1988 reads as follows:

460M. Tenders to be invited for contracts involving expenditure exceeding [rupees fifty thousand]

(1) Except as is hereinafter otherwise provided, the General Manager shall, at least seven days before entering into any contract for the execution of any work or the supply or any materials or goods which will involve an expenditure exceeding [fifty thousand rupees], give notice by advertisement in the local newspapers inviting tenders for such contract.

(2) The General Manager shall not be bound to accept any tender which may be made in pursuance of such notice, but may accept, subject to the provisions of clause (c) of Section 460K, any of the tenders so made which appears to him, upon a view of all the circumstances, to be the most advantageous.

Provided that the [Brihan Mumbai Electric Supply and Transport Committee] may authorize the General Manager for reasons which shall be recorded in their proceedings to enter into a contract without inviting tenders as herein provided or without accepting any tender which he may receiver after having invited them.

It is submitted that the Respondent No. 2 is required to invite tenders in every case where the contract for execution of any work or supply to any material or goods involves an expenditure to the Respondent No. 2 exceeding Rs. 50,000/- . The requirement for inviting a tender can nonetheless be dispensed with, where the BEST Committee authorises the General Manager for reasons recorded in the proceedings to enter into a contract without inviting tenders or accepting any tender which may be received after having invited them. Thus through Section 460 (M) mandates invitation tenders where the expense to the Respondent No. 2 exceeds Rs. 50,000/- , the requirements of inviting tender can be dispensed with in circumstances set out in Clause (ii) above. It is submitted that the statute does not make it mandatory in each and every case for tenders to be invited for the execution of any work or the supply of any material which involves an expenditure to the Respondent No. 2 in less than Rs. 50,000/- . In the instant case the Bus Queue Shelters are being constructed entirely at the cost and expense of Respondent No. 4 and 5. The Respondent No. 2 has incurred no expense. Thus there is no mandatory requirement for inviting tenders from the public at large. It is submitted that the Hon''ble Supreme Court of India in the case of 5 M and T Consultants, Secunderabad Vs. S.Y. Nawab and Another, had occasion to interpret the Andhra Pradesh Municipal Corporation Act 1955 and in particular Section 126 thereof which is parimateria to Section 460. The Hon''ble Supreme Court held that:

It is by now well settled that non- floating of tenders or absence of public auction or invitation alone is no sufficient reason to castigate the move or an action of a public authority as either arbitrary or unreasonably or amounting to mala fide or improper exercise or improper abuse of power by the authority concerned. Courts have always leaned in favour of sufficient latitude being left with the authorities to adopt their own techniques of management of projects with concomitant economic expediencies depending upon the exigencies of a situation guided by appropriate financial policy in the best interest of the authority motivated by public interest as well in undertaking such ventures .

The very applicability of the regulations contained in Sections 126, 129A, 148, 420 or 421 of the Act to the case on hand would itself be seriously doubtful. On the face of it they involve transaction envisaged therein, when granted in favour of third parties, to be executed with the Corporation funds and involving financial commitments or parting with the proper ty or rights and privileges of the Corporation for value/consideration, and not to a self- financing scheme to be implemented and maintained without any financial commitments or expenditure to the Corporation Section 124 seems to enable the Commissioner to undertake such ventures even without going before the Commit tee, as is now sought to be claimed.

Therefore, It is submitted finally that where a statute requires tenders to be invited in certain circumstances, then absent such circumstances, it is not mandatory for the public body to invite tenders. There is therefore no mandatory requirement to invite Public Tenders. Respondent No. 2 was well within its rights to award the contract to Respondent 4 to 5. It has not acted arbitrarily or unreasonably.

It is submitted that in the present case the BEST Committee has passed a resolution dated 12th June 2007 (page 208) approving of the proposal contained in para 6 to 9 of the note dated 12th June 2007 (page 209 - 224). It reads as under:

Ref: Note to the BEST Committee dated 08.06.2007 No. GM/AGM(C)/ 114/2007.

148 No. 148 - RESOLVED: "That, approval be and is hereby given, as required u/s 460 K(e) of the Mumbai Municipal Corporation Act, 1888 as amended upto date to extend the contracts as proposed in para No. 6 to 9, except sub- para (B) of para No. 9 of the note to the Committee.

2. "That, approval be and is hereby also given for extension period of the contract and display charges as per this Scheme shall start from the 1st October 2007, instead of from the 1st Day of following month in which the said proposal is approved by the BEST Commit tee, as proposed in sub-para (B) of para 9 of the Note to the Committee.

It is submitted that though Section 460M might not have been expressly referred to, the said resolution constitutes an authority under the proviso to Section 460M.

Therefore, it is submitted that the project is already underway and Respondent No. 4 has constructed about 1/3rd of the total Bus Queue Shelters allotted to it. Respondent No. 5 has constructed about 40% of the Bus Queue Shelters allotted to it. The entire project is likely to be completed within 6 months from today. If the Mumbai Transformation Project is delayed today, it will be very difficult to bring it back to line. There will be considerable delays. The cost of the project would rise. This would be against public interest and interest of commuters. In view of the above it is submitted that no interference is called for by this Hon''ble Court in exercise of extraordinary jurisdiction under Article 226 of the Constitution of India.

In the circumstances aforesaid it is submitted that no case has been made out by the Petitioner to warrant interference from this Hon''ble Court. The Petitioner is therefore liable to be dismissed with costs.

65. Before we proceed to deal with the petition on merits, we would like to clarify certain misgivings, particularly which arise from the submissions made by Mr. D.J. Khambata, Senior Advocate, appearing for respondent No. 5 and Mr. I.M. Chagla, the learned Senior Advocate , appearing for respondent No. 4 has tried to canvass that from the time the contract came to be awarded to respondent Nos. 4 and 5 (the work is already complete) under the project will go waste and serious disruption will be caused since the commencement of the present contract with effect from 1st October, 2007 till the petition was taken up for hearing it has progressed almost to the stage of completion.

(a) Respondent No. 4 has constructed about 423 Bus Que Shelters out of the total number of Bus Queue Shelters allotted to it;

(b) Respondent No. 5 has constructed about 306 Bus Queue Shelters allotted to it.

(c) Respondent No. 4 and 5 expect to complete the entire project within about 6 months from today.

And, therefore, the petition deserves to be dismissed in limine on this ground alone.

66. The records of the court reflect that the petitioners lodged this petition in this Court without any delay on their part as and when they learnt about the awarding of contract to respondent Nos. 4 and 5 by respondent Nos. 2 and 3. It appears that on 27th July, 2007 the petition was first taken up by the Court and the following order came to be passed :

CORAM : SWATANTER KUMAR, C.J. an Dr. D.Y. CHANDRACHUD, J.

DATED : 27TH JULY, 2007.

P.C.

Issue notice, returnable on 17th August, 2007.

2. Learned Counsel appearing for respective respondent Nos. 1 and 2 accept notice, waive service.

3. Liberty to serve other respondents by Registered Post A.D., as well as humdast.

4. Reply affidavit be filed within two weeks from today with an advance coy to the learned Counsel for the petitioners. Rejoinder thereto, if any, may be filed within one week thereafter.

5. In the meanwhile the extension / entering into fresh agreement with respondent Nos. 4 and 5 by respondent No. 2 shall be subject to the direction that may be passed in the present petition and finalisation of the contract in favour of the said respondents will be of no consequences.

66. Therefore, it is quite clear that the parties were put on notice that "in the meantime the extension / entering into fresh agreement by respondent Nos. 4 and 5 with respondent No. 2 shall be subject to the direction that may be passed in the present petition and finalisation of the contract in favour of the said respondents will be of no consequences."

67. Thereafter on 17th August, 2007 the matter was again listed before the Court when all the parties were represented by their respective advocates and the petitioner sought time to file rejoinder as the pleadings were almost complete and the matter stood adjourned to 5th October, 2007. It appears that thereafter the matter was listed from time to time but was not taken up for hearing. On 27th February, 2008, the Court passed an order "Stand over to 2nd April, 2008. It is made clear that parties would not be entitled to claim any equities in the matter." Thereafter again the matter came to be adjourned from time to time. Ultimately it was taken up for hearing by this Court in September, 2008. Therefore, if at all, Respondent Nos. 2 and 3 have permitted Respondent Nos. 4 and 5 to carry out any work under the alleged renewed contract / contract it has been done at the sole risk of the parties and that by itself cannot be a ground to dismiss the petition being infructuous. In our view such an approach is not permitted for the very reason that pendency of a lis where rights and liabilities of parties have to be determined will defeat the very due process of law and a dishonest litigant will be able to claim a decree in his favour for which he is not entitled to as this will put him in an advantageous position. The Rule of Law does not permit it.

68. Exhibit "A" annexed to the petition is a duplicate copy of the tender document issued by Civil Engineering Branch of Respondent No. 2. It consists of instructions to tenderers, form of tender, conditions of contract, form of offer, and Annexure ''A''. Conditions of Contract in the tender document clearly spell out scope of contract in clause (1) itself and it makes it clear that the contact is for the sole right of displaying advertisement only on those Undertaking''s Bus Queue Shelters which are incorporated in the list of Bus Queue Shelters (annexure ''A'' thereto) on payment of monthly expenses of display charges subject to the conditions of fulfilling a display charges as offered by the tenderer as per the ''Form of Offer'' and according to the ''Conditions of Contract''. The period of contract is specified in clause (1) (a). Clause (1)(c) provides for the period of contract. Clause (1)(c)(i) specifies the period of contract. Date of the commencement of the contract, for the given lot/s shall be taken as the 30th day from the date of issue of acceptance letter (Work order) to the Agency or the probable date of commencement mentioned hereunder, whichever is later. Since the ongoing contracts are expiring on three different dates, the date of commencement of new contract will be different.

Clause (1)(c)(ii) which refers to the extension of the period of contract provides as under :

The contract may be extended on the same terms and conditions of this contract on receipt of written request from the Agency. Such a request shall be strictly submitted to the Undertaking at least six months in advance of the date of expiry of that contract. However, the contract may be extended at the option of the Undertaking for a term of three months on each occasion for a total period not exceeding one year. The decision of the General Manager in this regard shall be final and binding on the Agencies.

Clause (1)(c)(iii) reads as under :

The Agency shall not be allowed to display advertisement on Bus Queue Shelter unless and until the Security Deposit referred to in Clause No. 18 of ''Conditions of Contract'' is paid to the Undertaking vis-vis before obtaining the necessary permissions/ NOC form the MCGM and other concerned Statutory Authorities.

Therefore, it can be seen that the contract which was given from 2005 and was to end on 31st December, 2008 contains a specific clause for extension of the same on the terms and conditions on receipt of written request from the Agency which was to be made at least six months in advance of the date of expiry of that contract and however it also provides that the contact may be extended at the option of the Undertaking i.e. Respondent No. 2 for a term of three months on each occasion for a total period not exceeding one year and the decision of the Respondent No. 2 in this regard shall be final and binding. There is no dispute over the fact that the Respondent Nos. 4 and 5 were the successful bidders for the respective lots in respect of the tender which was invited for sole agency for display of advertisement on Undertaking''s Bus Queue Shelters in Brihan Mumbai (2005-2008). Nowhere in the tender document there is any provision particularly in conditions of the contract which defines the terms on which the contract was to be awarded that respondent No. 2 and 3 had any discretion or reserved any right to modify, annul the contract which was invited by public tender beyond the terms and conditions of the contract so as to replace or substitute it by totally new contract. Nor such a stand is taken before the Court by Respondent Nos. 2 and 3.

69. The justification put forth by Respondent Nos. 2 and 3 that at the time of the contract the scheme for beautification of Mumbai was not envisaged and that in order to implement the process for beautification / modernisation of these bus shelters by January, 2009 and, therefore, to obviate the necessity of waiting till January, 2009, for implementation of the scheme, the Respondent Nos. 2 and 3, the BEST Committee, took a conscious and considered decision to seek views and participation of Respondent Nos. 4 and 5 for modernisation of the existing bus stops and Respondent Nos. 4 and 5 were initially invited to modernize bus shelters on lines of "First Finder Scheme". However, they were willing to participate for modernisation of only 1377 bus shelters out of 2143 bus shelters. And Respondent Nos. 2 and 3 were keen and insisting upon modernisation of all bus shelters and not only those having advertisement potential. Respondent Nos. 2 and 3 on the one hand and Respondent Nos. 4 and 5 on the other met on several occasions and agreed for contract in present form. In the submissions made by Mr. Thorat, the learned Senior Advocate appearing for Respondent Nos. 2 and 3 which we have referred to earlier, Respondent Nos. 2 and 3 have justified by citing circumstances which have left Respondent Nos. 2 and 3 with no choice but to negotiate with Respondent Nos. 4 and 5 for modernisation of existing bus shelters and this, according to the respondents, was done within the legislative powers conferred on the Respondents by the M.M.C. Act, 1888 and particularly Chapter XVI A in relation to Respondent No. 2 Undertaking and as the decision has been taken by the Respondent No. 2 mainly concerns with the service to be provided to the passengers of bus service and erection of shelters in such a manner as to beautify the city which was primary task of Respondent No. 2 and due to financial constraints Respondent No. 2 decided to entrust this task to provide favours in order to compensate them they were to be given advertising rights which is permissible under the law and have placed reliance on Section 460A and Section 460 M of the MMC Act, 1888. It is also contended by placing reliance on various authorities of the Apex Court and particularly by citing the decision rendered by the Apex Court in the case of G.B. Mahajan and others Vs. The Jalgaon Municipal Council and others, and that of 5 M and T Consultants, Secunderabad Vs. S.Y. Nawab and Another, . We propose to refer to these two decisions on which reliance has been placed by not only the learned Counsel appearing for Respondent Nos. 2 and 3 but also Respondent Nos. 4 and 5.

70. Let us advert to the exigencies which have been cited to justify the allotment of special contract in favour of respondent Nos. 4 and 5 without inviting for tenders from the public.

71. The primary concern of the Respondent Nos. 2 and 3 stems from a decision taken by the Empowered Committee constituted by the State of Maharashtra which was constituted under the Chairmanship of the Chief Secretary to monitor progress of the implementation of the Mumbai Transportation Project. The minutes of the Empowered Committee meeting held on 2nd September, 2006 in the Committee Room, Mantralaya has been annexed to the affidavit in reply as Exhibit "A". The minutes record review of the action taken on the issues discussed in previous meetings held on 5th August and 3rd July 2006 and in the minutes at item 2.v. There is a reference to beautification of bus shelters which reads as under :

Beautification of Bus Shelters - Project Manager MTSU informed that the Notification u/s 144E of the MMC Act has been submitted to the MCGM and is to be approved by the Prin. Section UDD - II of the GoM, Prin. Section UDD - II agreed to take the necessary action.

These observations of the Empowered Committee which also considered the presentation of bus shelters on 27th December, 2006. The Chief Engineer (Civil) of Respondent No. 2 has placed reliance on item No. 356 which was relating to Bus Queue Shelters in place of existing bus queue shelters and display of advertisement thereon under the Bus Shelter Scheme. This was taken into consideration when item No. 356 came up for discussion on 27th December, 2006 before the Committee and the following Resolution was taken.

Item No. 356

27.12.2006 .

While speaking on the subject, Shri Ravi Raja stated that, the Administration had in the past, with the approval of the B.E.S. & T. Committee, awarded the contract for display of advertisements on the bus queue shelters of the Undertaking by dividing the same between the firms M/s. Prithvi Associates & M/s. Bennet Colemn within the limits of the Brihanmumbai Mahanagar Palika. He further stated that, instead of constructing the bus queue shelters by the B.E.S. & T. Undertaking, if the said Agencies construct the bus queue shelters for the B.E.S. & T. Undertaking, if the said Agencies construct the bus queue shelters within the limits of the Brihanmumbai Mahanager Palika, they may be permitted to display the advertisements on the said bus queue shelters. Also, they may be included in the said Scheme.

The General Manager stated that, if the said Agencies are complying with the terms and conditions of the Scheme by constructing new bus queue shelters in place of the existing bus queue shelters, they will also be included in the said Scheme.

The Chairman stated that, if the concern Agencies approach the Undertaking for construction of new bus queue shelters in place of the existing bus queue shelters and if the said Agencies are fulfilling the terms and conditions of the Scheme, they may be included in the said Scheme.

Thereafter, as there was no further discussion in the matter, the Chairman put the proposal submitted by the Administration to vote and since it was not opposed by anyone., he declared that it was carried unanimously."

Thereafter,

507. No. 507 - Resolved : "That, the approval be and is hereby given to the proposal containing Para No. 6 of the Note to the Committee.

If one goes through Note submitted by the Civil Engineering Branch in reference to item No. 356 which relate to the erection of existing bus queue shelters and display of advertisement thereon in the first finders'' scheme, there is no reference to the construction of bus queue shelter in place of the existing bus queue shelters as the approval of the BEST Committee was sought in item No. 6 of the Note which reads as under :

6. The approval of the BEST Committee is, therefore, requested

(i) To award the contract under First Finder Scheme under all ''Terms & Conditions'' of approved scheme to 18 Agencies for 765 bus stop poles as detailed in Annexure ''A'' to ''R & Annexure ''S'' under First Finder Scheme and to enter into the contract with them u/s 460 ''K(C)'' of M.M.C. Act - 1888 as amended upto date.

(ii) To refund an amount of Rs. 750/- per bus stop pole to all the agencies for the sites which are not awarded to them.

Therefore, it is quite clear that the Committee was to take a decision in the matter of item No. 356 which was dealing with the subject of awarding the contract "under the First Finder Scheme under all terms and conditions of contract of approved scheme to 18 Agencies for 765 bus stop poles as detailed in Annexure ''A'' to ''R & Annexure ''S'' under First Finder Scheme and to enter into the contract with them u/s 460 ''K(C)'' of M.M.C. Act - 1888 as amended upto date" and the Committee resolves that "the approval be and is hereby given to the proposal containing Para No. 6 of the Note to the Committee." Though in the minutes there is a reference to the suggestion made by Shri Ravi Raja that in the past, with the approval of the B.E.S. & T. Committee, contract was awarded for display of advertisements on the bus queue shelters of the Undertaking by dividing the same between the firms M/s. Prithvi Associates & M/s. Bennet Colemn within the limits of the Brihanmumbai Mahanagar Palika and his suggestion that instead of constructing the bus queue shelters by Respondent No. 2, if the said Agencies construct the bus queue shelters within the limits of the Brihanmumbai Mahanager Palika, they may be permitted to display the advertisements on the said bus queue shelters. Also, they may be included in the said Scheme and the 3rd Respondent i.e., the General Manager stated that if the said agencies are complying with the terms and conditions of the scheme by constructing new bus queue shelters in place of the existing bus queue shelters, they will also be included in the said scheme, which as we understand was in reference to the First Finder Scheme which was the subject before the Committee. But this was not the subject before the Committee on which decision was required to be taken nor the Committee resolved to that effect that the Respondent Nos. 4 and 5, the existing contractors should be permitted to construct new bus queue shelters in place of the existing bus queue shelters and that they should be permitted to display the advertisement on said bus queue shelters. It appears from the document annexed by Respondent No. 2 that this was construed by Respondent No. 2 and 3 to negotiate with Respondent Nos. 4 and 5 the terms and conditions on which they would be willing to construct the existing bus queue shelters as per the specifications in the First Finder Scheme in consideration of permitting them to commercially exploit the existing bus queue shelters by displaying advertisements after reconstructing the same. The records and proceedings placed before us by the Respondent Nos. 2 and 3 does not disclose any material to justify as contended by Respondent Nos. 2 and 3 before this Court as to why the Respondent Nos. 2 and 3 thought it proper not to invite bids from the public at large by floating tenders for the said purpose rather than negotiating the same with the existing contractors whose contract to display advertisements on existing bus queue shelters was to come to an end by 31st December, 2008 at least to ascertain whether persons/parties doing business in the field were interested to participate or not and secondly to ascertain its commercial viability and potentiality to generate revenue. On the other hand, what appears from the record is that after negotiating with Respondent Nos. 4 and 5, Respondent Nos. 2 and 3 took up the matter before the Committee and in the meeting held on 12th June, 2007 this subject was taken up at item No. 112 and the following resolution came to be passed which is annexed to the affidavit in reply of Respondent No. 2 as Exhibit "E".

ITEM No. 112 (contd.)

12.06.2007

Ref : Note to the BEST Committee dated 08.06.2007 No. GM/AGM(C)/ 114/2007.

148. No. 148 - RESOLVED : "That, approval be and is hereby given, as required u/s 460 K(e) of the Mumbai Municipal Corporation Act, 1888 as amended unto date to extend the contracts as proposed in para No. 6 to 9, except sub- para (B) of para No. 9 of the note to the Committee.

2. "That, approval be and is hereby also given for extension period of the contract and display charges as per this Scheme shall start from the 1st October 2007, instead of from the 1st Day of following month in which the said proposal is approved by the BEST Committee, as proposed in sub- para (B) of para 9 of the Note to the Committee.

72. It is pertinent to note that the resolution of the BEST committee has been taken u/s 460 K (e) of the Mumbai Municipal Corporation Act, 1888 which reads as under :

460 K (e) "The foregoing provisions of this section shall, as far as may be, apply to every contract which the General Manager shall have occasion to make in the execution of this Act; and the same provisions of this section which apply to an original contract shall be deemed to apply also to any variation or discharge of such contract.

A plain reading of Section 460 K (e) of the Mumbai Municipal Corporation Act, 1888 does not empower Respondent No. 2 to take such a decision which has been taken on 12th June, 2007 under Item No. 112 by the Committee "That, approval be and is hereby also given for extension period of the contract and display charges as per this Scheme shall start from the 1st October 2007, instead of from the 1st Day of following month in which the said proposal is approved by the BEST Committee, as proposed in sub- para (B) of para 9 of the Note to the Committee."

If one refers to the note to the Committee which is annexed as Exhibit "F" which has been approved in the meeting dated 12th June, 2007 it is nothing but what has been agreed between respondent Nos. 2 and 3 on the one hand and respondent Nos. 4 and 5 on the other hand and as already observed by us, this was done by bypassing the mandatory provision of Section 460 M of the MMC Act, 1888 which cannot be read in the manner the learned Counsel for Respondent No. 2 wants us to understand in order to justify their decision by bypassing the well accepted principle of awarding contract by inviting tenders.

Section 460 M of the MMC Act, 1888 reads as under :

460M. Tenders to be invited for contracts involving expenditure exceeding (rupees fifty thousand.:- (1) Except as is hereinafter otherwise provided, the General Manager shall, at least seven days before entering into any contract for the execution of any work or the supply of any materials or goods which will involve an expenditure exceeding fifty thousand rupees, give notice by advertisement in the local newspapers inviting tenders for such contact.

(2) The General Manager shall not be bound to accept any tender which may be made in pursuance of such notice, but may accept, subject to the provisions of clause (c) of Section 460K, any of the tenders so made which appears to him, upon a view of all the circumstances, to be the most advantageous;

Provided that the Brihan Mumbai Electric Supply and Transport Committee may authorise the General Manager for reasons which shall be recorded in their proceedings to enter into a contract without inviting tenders as herein provided or without accepting any tender which he may receive after having invited them.

Section 460 M finds place in Chapter XVI A which governs the management and administration of Respondent No. 2. A plain reading of Section 460 M makes it crystal clear that in case of contract involving expenditure exceeding rupees fifty thousand it is required to be awarded by giving notice by advertisement in the local newspapers inviting tenders for such contracts. Though it is not an issue in the present case that tenders and offers were invited by Respondent No. 3 at the time the Respondent No. 2 awarded the contract for display of advertisement on Bus Queue Shelters in Brihan Mumbai for the years 2005-2008 and also when respondent No. 2 felt it necessary to convert Bus Stop Poles into Bus Queue Shelters under the "First Finder" scheme after obtaining the BEST Committee''s approval vide BCR 474 dated 07.12.2006 for erection of Bus Queue Shelters in place of Bus Stop Poles and display of advertisement thereon. The Respondent Nos. 2 and 3 did not feel it necessary to abide by the said requirement when a decision was taken to convert the existing Bus Queue Shelters by erecting new Bus Queue Shelters.

73. The justification offered by the Respondent No. 2 in not inviting tenders is that the Respondent No. 2 have statutory powers to dispense with inviting such tenders and a decision to that effect was taken in the meeting of the Respondent No. 2''s Committee held on 12.6.2007 in which the note dated 8.6.2007 was placed which was approved by the Committee at Item No. 112. The said approval awarded to the resolution of the Committee came to be accorded in terms of Section 460 K (e) of the MMC Act, 1888 which provides for making a contract for the purpose of the Brihan Mumbai Electric Supply and Transport Undertaking including contracts relating to the acquisition and disposal of immovable property or any interest therein, or any right thereto. Clause (e) of Section 460 K specifically provides that the foregoing provisions of this section shall, as far as may be, apply to every contract which the General Manager shall have occasion to make in the execution of this Act; and the same provisions of this section which apply to an original contract shall be deemed to apply also to any variation or discharge of such contract and according to the learned Counsel for respondent No. 2 in substance the contract which was awarded to respondent Nos. 4 and 5 for displaying advertisements on Bus Queue Shelters in Brihan Mumbai is actually a variation of the existing contract which was awarded to Respondent No. 5 after inviting tenders. We find that this submission or stand taken by Respondent No. 2 before this Court is contrary to the affidavit in reply filed by Shri S.A. Kaikini, the Chief Engineer (Civil) in reply to the petition and particularly in paragraph 17 wherein he has stated

I respectfully say and submit that the award letter though refers to extension of license, however, in reality, it is altogether a new contract awarded in favour of Respondent Nos. 4 and 5 w.e.f. 1.10.2007 with revised terms and conditions as well as different rates of advertisement display charges, in line with the terms and conditions of the "First Finder" Scheme

and the further justification is given in paragraph 19 wherein it is stated

I respectfully say and submit that in the event of contract being denied to Respondent No. 4 & 5 as prayed by the Petitioner great prejudice and loss will be caused to Respondent No. 2, and the revenue loss alone will be to the tune of Rs. 69 Lacs per month (being the differential revenue till 2008). Moreover, passengers will be deprived of better facilities of modern bus queue shelters and the City of Mumbai will have to continue with the old bus queue shelters at least till 31/12/2008, which again will create hurdle in the Mumbai Transformation Project.

Even without adverting to the various authorities cited at the Bar, we have no hesitation to arrive at a conclusion that the contract given to Respondent Nos. 4 and 5 which is the subject matter of challenge neither conforms to the requirements of the statute as provided u/s 460 M nor falls within the powers of the General Manager i.e. Respondent No. 3 of Respondent No. 2 while making contract u/s 460 K particularly with reference to clause (e) as the resolution which accords approval to the General Manager to change the terms and conditions of the contract awarded to Respondent Nos. 4 and 5 were permitted to be varied. If it is the case of Respondent No. 2 that it was a totally new contract then there is no reason why they should not have invited tenders as required u/s 460 M and the justification given by them in paragraph 19 of the affidavit in reply that if this contract is denied to respondent Nos. 4 and 5 then great prejudice and loss will be caused to respondent No. 2 and the revenue loss alone will be to the tune of Rs. 69 Lacs per month and further passengers will be deprived of better facilities of modern bus queue shelters and the City of Mumbai will have to continue with the old bus queue shelters at least till 31/12/2008, which again will create hurdle in the Mumbai Transformation Project, which, in our opinion, cannot be accepted as a justification at all for not following the statutory requirements before awarding the said contract to Respondent Nos. 4 and 5.

74. The Petitioners and Respondent Nos. 4 and 5 have also given their respective projections as to the revenue which could have been earned. According to the projection given by the petitioners and which is actually earned and beneficial to Respondent No. 2 as projected by Respondent Nos. 4 and 5. The petitioners have given a comparative chart of the original tender which was given to Respondent Nos. 4 and 5, the "First Finder" Scheme and the benefits which are extended to Respondent Nos. 4 and 5 by varying the terms and conditions of the original tender as under :

Compared with this, the respondent Nos. 4 and 5 have spelt out the benefits received by Respondent No. 2 under the present contract awarded to Respondent Nos. 4 and 5 which are as under :

(A) The contracts awarded to Respondent No. 4 (dated 31st March 2005) and to Respondent No. 5 (dated 19th June 2007), was with effect from 1st October 2007 and were valid right upto 31st December 2008. The Respondent No. 4 and Respondent No. 5 were therefore well within their rights to commercially exploit these Bus Queue Shelters right upto 31st December 2008 without any hindrance or obstruction from Respondent No. 2.

Notwithstanding, this, Respondent Nos. 4 and 5 agreed to pay incremental / display charges to Respondent No. 2 under the new contract with effect from 1st October 2007 (instead of 1st January 2009) even though

(iii) the contract dated 31st March 2005 was still valid until 31st December 2008 and renewable until 31st December 2009.

(iv) the new Bus Queue Shelters were yet to be constructed. Thus Respondent No. 4 and Respondent No. 5 are higher paying display charges even though they are not able to immediately commercially exploit all Bus Queue Shelters.

By virtue of the above, the Respondent No. 4 and Respondent No. 5 had conferred a benefit on Respondent No. 2 in the sum of Rs. 4,69,25,951. The details are as under:

The other benefits to Respondent No. 2 are:

Thus the total benefit derived by Respondent No. 2 is Rs. 51,20,19,024/- on the basis of Rs. 3.06 lacs per Bus Queue Shelters and Rs. 65,48,66,164/ - on the basis of the costs of Rs. 4.40 lacs per Bus Queue Shelters which is the actual cost per Bus Queue Shelter, being incurred by Respondent No. 4 and 5

Note:

3. Respondent No. 4 by its letter dated 25/5/02 to Respondent No. 2 (see page 259 at page 260) has stated that investment on additional shelters (i.e. non saleable) will be approximately Rs. 14 crores. This cost works out to Rs. 4.40 lacs per Bus Queue Shelters.

4. Respondent No. 4 and 5 in fact have bills and invoices to prove the costs incurred by them to be approx Rs. 4.70 lacs per Bus Queue Shelters.

74. It is the case of the Respondent No. 2 is that as per the terms of payment granted to the 4th and 5th Respondent under the new contracts, the total revenue that would accrue to the 2nd Respondent for the 15 year contract with respect to the City would be Rs. 149 crores approximately. Similarly, the revenue fo the Western Suburbs would be Rs. 153 crores approximately and for the Eastern Suburbs would be Rs. 83 crores approximately. Therefore, according to Respondent No. 2, the total projected earnings for the whole of Greater Mumbai for the 2nd Respondent for a 15 years period based on the terms of payment granted to the 4th and 5th Respondents would be Rs. 387 crores approximately.

75. In their submissions made to this Court the learned Counsel for Respondent No. 2 has raised three principal questions which, according to him, will arise for consideration :

I. Whether the Respondent Nos. 2 and 3 have statutory powers under the Act, to take an administrative decision assailed in the present Petition (Section 460 (M) and Section 460(K)].

II. Whether the decision making process is arbitrary and irrational on the basis of Wednessbury''s principle of unreasonableness and whether the resultant decision is against the public interest.

III. Whether the fundamental rights of the Petitioners are violated as a result of the decision.

And accepting that these are the key issues on the basis of which the Court should examine the merits of the matter, we find that the Respondent Nos. 2 and 3 have failed on the first two counts and in so far as the third issue

Whether the fundamental rights of the Petitioners are violated as a result of the decision with emphasis we say ''YES".

76. The principles which culls out from the authorities relied upon by the parties can be summed up as under :

77. In so far as the third issue is concerned, as to whether the fundamental rights of the petitioners are violated as a result of the decision, the matter now stands covered by the recent decision of the Supreme Court in the case of Reliance Energy Limited and Another Vs. Maharashtra State Road Development Corporation Ltd. and Others, , wherein it has been held as under :

Standards applied by courts in judicial review must be justified by constitutional principles which govern the proper exercise of public power in a democracy. Article 14 of the Constitution embodies the principle of "nondiscrimination". However, it is not a freestanding provision. It has to be read in conjunction with rights conferred by other articles like Article 21 of the Constitution. The said Article 21 refers to "right to life" and embodies several aspects of life. It includes "opportunity". Articles 21 and 14 are the heart of the chapter on fundamental rights. They cover various aspects of life.

Level playing field" is an important concept while construing Article 19(1)(g) of the Constitution. It is this doctrine which is invoked by REL/HDEC in the present case. When Article 19(1)(g) confers fundamental right to carry on business to a company, it is entitled to invoke the said doctrine of "level paying field". This doctrine is, however, subject to public interest. In the world of globalisation, competition is an important factor to be kept in mind. The doctrine of "level playing field" is an important doctrine which is empodied in Article 19(1)(g) of the Constitution. This is because the said doctrine provides space within which equally placed competitors are allowed to bid so as to subserve the larger pubic interest. "Globalisation", in essence, is liberalisation of trade. Today India has dismantled licence raj. The economic reforms introduced after 1992 have brought in the concept of "globalisation". Decisions or eats which result in unequal and discriminatory treatment, would violate the doctrine of "level playing field" embodied in Article 19(1)(g). There is one more aspect which needs to be mentioned in the matter of implementation of the aforestated doctrine of "level playing field". Commitment to "rule of law" is the heart of parliamentary democracy. One of the important elements of the "rule of law" is legal certainty. Article 14 applies to government policies and if the policy or act of the Government, even in contractual matters , fails to satisfy the test of "reasonableness", then such an act or decision would be constitutional.

When tenders are invited, the terms and conditions must indicate with legal certainty, norms and benchmarks. This "legal certainty" is an important aspect of the rule of law. If there is vagueness or subjectivity in the said norms it may result in unequal and discriminatory treatment. It may violate doctrine of "level playing field".

In matter of judicial review the basic test is to see whether there is any infirmity in the decision-making process and not in the decision itself. This means that the decision-maker must understand correctly the law that regulates his decision-making power and he must give effect to it. Otherwise, it may result in illegality. The principle of "judicial review" cannot be denied even in contractual matters of matters in which the Government exercises its contractual powers, but judicial review is intended to prevent arbitrariness and it must be exercised in larger public interest.

78. On the other aspects of the matter the law can be summed up by citing the following authorities :

(1) The Supreme Court has held in the case of Subhash Acharya v. State of Maharashtra and Ors. (Writ Petition 580 of 2007) (paragraphs 27 and 32) that it is obligatory upon the State to adopt fairness in its actions including trading activity like inviting tenders for its work. The purpose of this is to ensure protection to the financial interests of the State. It was held that extension of the contract without inviting tenders was not at all a fair or proper method of awarding contracts, was unsustainable in law and the State had not exercised its discretion properly.

(2) In the case of Kasturi Lal Lakshmi Reddy, Represented by its Partner Shri Kasturi Lal, Jammu and Others Vs. State of Jammu and Kashmir and Another, the Apex Court has held in paragraphs 10 to 12 & 14 that while awarding contracts the State has to exercise its discretion for the public good and not arbitrarily. The action must satisfy the twin tests of reasonableness and public interest or else the action would be invalid.

(3) The terms of the original Tender floated in March 2005 specifically provided that if the contracts under the Tender were to be extended, the same could only be done for a maximum period of one year. Therefore, the extension of 15 years granted by the 2nd Respondent is contrary to the terms of the Tender. The Supreme Court in the case of Harminder Singh Arora Vs. Union of India (UOI) and Others, has held that where a Public Authority or State chooses to invite Tenders, then it must abide by the conditions laid down in the Tender notice and where the terms are changed, the bidders under the original terms ought to be allowed to submit fresh offers in conformity with the new terms. Therefore, whether it is a case of renewal of a contract or execution of a fresh contract, the same is immaterial in the case of Government contracts. The settled law on the point clearly shows that it is virtually mandatory for a Government /or public body to call for a public auction or tender.

(4) The Supreme Court in the case of Mahesh Chandra Vs. Regional Manager, U.P. Financial Corporation and others, has held that in the case of any transactions involving public property, a public auction is universally recognised to be the best and most fair method. The calling of tenders to execute works, award contracts, etc. can also be resorted to if a public auction is not possible. However, the Hon''ble Supreme Court has gone on to expressly state that "private negotiations" should always be avoided by the public authority as it cannot withstand public gaze. Also, every effort must be made to get the maximum price for the State in a Government contract.

(5) The Supreme Court in the case of Shri Sachidanand Pandey and Another Vs. The State of West Bengal and Others, has held that the ordinary rule while dealing with state- owned or public- owned property is to do so by public auction or by inviting tenders. Only where there are compelling reasons should there be a departure from this general rule and even then, the reasons for departure must be rational and not suggestive of discrimination. The Supreme Court expressly held that "Nothing should be done which gives an impression of bias, jobbery or nepotism".

(6) The Supreme Court in the case of LIC of India and Another Vs. Consumer Education and Research center and Others, held that "In the sphere of contractual relations the State, its instrumentality, public authorities or those whose acts bear insignia of public element, action to public duty or obligation are enjoined to act in a manner that is fair, just and equitable after taking objectively all the relevant options into consideration and in a manner that is reasonable, relevant and germane to effectuate the purpose for public good and in general public interest and it must not take any irrelevant or irrational factors into consideration or appear arbitrary in its decision. Duty to act fairly is part of fair procedure envisaged under Articles 14 and 21. Every activity of the public authority or those under public duty or obligation must be informed by reason and guided by the public interest.

79. In so far as Respondent Nos. 2 and 3 and 4 and 5 are concerned, they heavily relied upon the decision of the Supreme Court in the case of 5 M and T Consultants, Secunderabad Vs. S.Y. Nawab and Another, which, according to the learned Counsel appearing for Respondent No. 2 is identical to the facts in the present case. In the case of M & T Consultants, Secunderabad v. S.Y. Nawab and Anr., the Supreme Court held in the given circumstances grant of permission to a party to take up, on trial basis without affording opportunity to others in a matter of contacts where the Municipal Corporation was desiring to erect for the use and benefit of public , road direction boards on thoroughfares of the city but finding itself handicapped due to financial incapacity gave it to the appellants who offered to take up the house- numbering, erection of street signboards with necessary details about the locality at his costs on the consideration that he would be free to let out to his clients the space provided for advertising purposes on such sign boards, the corporation permitted the appellant to take up the said project and it was held that the grant of such permission to the appellant was neither arbitrary nor violative of Sections 126, 129-A, 148, 420 and 421 of Hyderabad Municipal Corporation Act since none of other private agencies offered to undertake such a venture in other available areas when invited for that purpose. This contract was challenged in a public interest litigation and the Supreme Court after examining various authorities upheld the decision on the premise that no other private advertising agencies including the respondent could offer to take up such a venture in other available areas when their participation was sought belies the tall claims of the respondent now made, after finding the project to have become successful and fruitful.

80. Another case on which reliance is places is that of G.B. Mahajan and others Vs. The Jalgaon Municipal Council and others, . In G.B. Mahajan''s case the facts were that a piece of land had been received by the Town Municipal Council, Jalgaon by way of gift from ''L'' in 1913. In terms of the gift the land had been put to use of the Agricultural Produce Market Committee, as a cotton and wholesale fruit and vegetable market. With a view to put the land to a better and more profitable use the Municipal Council contemplated a project comprising, inter alia, erection of a commercial complex. The Municipal Council persuaded the Market Committee to yield up possession and also secured suitable amendment in the terms of the gift deed from the heirs of ''L'' subject to the condition that the heirs should be given five shops free of cost in the commercial complex. The project scheme contemplated that a ''developer'' would execute the entire project at his own cost and would make various allotments to the shopkeepers to whom the Municipal Council had given assurances of alternative accommodation at fixed rates of premia and provide ground plus 17 floors of the administrative building free of cost to the municipality. The occupiers, including those who would have the benefit of the allotments at such fixed rates as well as those to be inducted by the developer, had been given ''occupancy right'' for a period of 50 years u/s 272(1) of Maharashtra Municipalities Act, 1965. They were expected to pay rents to the Municipal Council for the period of 50 years at rates envisaged in the scheme. In consideration of the execution of the project at own cost the developer would be entitled and at liberty to dispose of the occupancy rights in respect of the rest of the accommodation in "Commercial Complex" and retain the premia paid by the disponees so as to reimburse itself the financial outlays on the project plus its profit. The project was put up to tender and the tender of respondent No. 6 having been accepted by the Municipal Council by its unanimous resolution, an agreement was entered into between the Municipal Council and respondent No. 6 in this behalf. The appellants, being residents of Jalgaon, question the execution of the project. Mainly the following contentions were raised before the Court.

(a) That the scheme of financing of the project was unconventional and was not one that was, as a matter of policy, open and permissible to a government authority. The municipal authority could either have put up the construction itself departmentally or awarded the execution of the whole project to a building contractor. The method of financing and execution of the project are ultra vires the powers of the Municipal authority under the Act.

(b) That the terms of the agreement with the developer that the latter be at liberty to dispose of the occupancy rights in the commercial complex in such manner and on such terms as it may choose would amount to an impermissible delegation of the statutory functions of the municipal Council u/s 272 of the Act to the developer.

(c) That the project, in effect, amounted to and involved the disposal of municipal property by way of a long term lease with rights of sub- letting in favour of the developer violative of Section 92 of the ''Act''.

(d) That the scheme is arbitrary and unreasonable and is violative of Article 14 of the Constitution. The project is patently one intended to and does provide for an unjust enrichment of respondent 6 at public expense.

Allowing the appeal against the High Court''s order of dismissal of the writ petition of the appellants the Supreme Court held :

(1) A project, otherwise legal, does not become any the less permissible by reason alone that the local authority, instead of executing the project itself, had entered into an agreement with a developer for its financing and execution. The criticism of the project being ''unconventional'' does not add to or advance the legal contention any further. The question is not whether it is unconventional by the standard of the extant practices, but whether there was something in the law rendering it impermissible. Though there is a degree of public accountability in all governmental enterprises, but the present question is one of the extent and scope of judicial review over such matters. With the expansion of the State''s presence in the field of trade and commerce and of the range of economic and commercial enterprises of government and its instrumentalities there is an increasing dimension to governmental concern for stimulating efficiency, keeping costs down, improved management methods, prevention of time and cost overruns in projects, balancing of costs against time scales, quality control, cost- benefit ratios etc. In search of these values it might become necessary to adopt appropriate techniques of management of projects with concomitant economic expediencies. These are essentially matters of economic policy which lack adjudicative disposition, unless they violate constitutional or legal limits on power or have demonstrable pejorative environmental implications or amount to clear abuse of power. This again is the judicial recognition of administrator''s right to trial and error, as long as both trial and error are bona fide and within the limits of authority. In the ever increasing tempo of urban life and the emerging stresses and strains of planning ,wide range of policy options not inconsistent with the objectives of the statute should be held permissible. Therefore, in the context of expanding exigencies of urban planning it will be difficult for the court to say that a particular policy option was better than another. The contention that the project is ultra vires the powers of the Municipal Council is not acceptable.

(2) The contention regarding impermissible delegation is not tenable. The developer to the extent he is authorised to induct occupies in respect of the area earmarked for him merely exercises, with the consent of the Municipal Council, a power to substitute an occupier in his own place. This is not impermissible when it is with the express consent of the Municipal Council. It woulds be unduly restrictive of the statutory powers of the local authority if a provision enabling the establishment of markets and disposal of occupancy rights therein are hedged in by restrictions not found in the statute.

(3) The appellants have not been able to establish that the essential elements of the transaction are such that Section 92 of the Act is violated. In the present case it is possible to fit the power exercised by municipal authority into Section 272(1) of the Act. The provision therefore should not be interpreted unduly restrictively to exclude such enterprise.

(4) ''Reasonableness'' as the test of validity is not the courts own standard of reasonableness as it might conceive it in a given situation. A thing is not unreasonable in the legal sense merely because the court thinks it is unwise. Different contexts in which the operation of "reasonableness" as test of validity operates must be kept distinguished. Some phrases which pass from one branch of law to another carry over with them meanings that may be inapposite in the changed context. Some such thing has happened to the words "reasonable", "reasonableness" etc. The ''reasonableness'' in administrative law must distinguish between proper use and improper abuse of power. The administrative law test of ''reasonableness'' as the touchstone of validity of the impugned resolutions is different from the test of the ''reasonable man'' familiar to the law of torts, whom English law figuratively identifies as the "man on the Clapham omnibus". In the latter case the standard of the ''reasonable man'', to the extent such a ''reasonable man'' is court''s creation, is in a manner of saying, a mere transferred epithet. Yet another area of reasonableness which must be distinguished is the constitutional standards of ''reasonableness'' of the restrictions on the fundamental rights of which the court of judicial review is the arbiter.

81. While dealing with these two cases, the Supreme Court has taken into consideration various authorities on the subject and found that these two cases had distinct features and in the given facts and circumstances the Municipal Corporations were justified in awarding the contracts. In the first case of 5 M & T Consultants, Secunderabad v. S.Y. Nawab and Anr., there were no takers for the scheme and in the second case of G.B. Mahajan v. Jalgaon Municipal Council, the contract was awarded after inviting tenders. In G. B. Mahajan''s case it was challenged that the contractor could not have delegated with powers to disposed of remaining accommodation at its own discretion and to retain the premia paid by the disponees so as to reimburse itself the financial outlays on the project plus its profit as that was a contract with private developer or construction on commercial footing.

82. Before parting with this judgment we may like to observe that the exigency which has been quoted by Respondent No. 2 to adopt this procedure of specially awarding the contract to Respondent Nos. 4 and 5 by altering the terms and conditions of the contract initially awarded to them for displaying advertisement at existing Bus Queue Shelters in Greater Mumbai was in public interest as the dominant purpose was not about developing rights of bus shelters but it was primarily for erection and modernisation of Bus Queue Shelters and grant of development rights is only a compensatory measure for erection of such shelters and, therefore, it cannot be argued that the contract is itself vitiated because of failure to invite tenders. The Respondent No. 2 have gone to the extent of supporting their conduct by holding the brief for Respondent Nos. 4 and 5 when the learned Counsel submitted that the Respondent Nos. 4 and 5 have no pecuniary advantage under the agreement and that whatever has been projected by the petitioners relating to generation of revenue which such a contract had potential. It has been submitted that these are the submissions which are not pleaded but are merely hypothetical calculations and further that the delay which could have been caused by allowing the original terms and conditions of contract awarded in favour of Respondent Nos. 4 and 5 the Respondent No. 2 was required to wait till 31st December, 2008 which again will create hurdle in Mumbai Transformation Project, is nothing but submissions extraneous to the issue and to camouflage their conduct in awarding contract to respondent Nos. 4 and 5 without inviting tenders as provided in the statute. We can take judicial notice of the fact that the Mumbai Transformation Project as can be seen from the minutes of the Empowered Committee (EC) Meeting which is annexed as Exhibit "A" to the affidavit in reply filed by Respondent No. 2 consisted of various measures much more important and necessary like Modernisation of Airport, New Airport, Guidelines for Pavement Beautification and Maintenance, rehabilitation of the Pavement Dwellers, MUTP II, MTHL, Dharavi Redevelopment project, Construction of One Lac Houses, Construction of Underbellies of Flyovers, Waterfronts Development, Reforms by way amendment to the Rent Control Act and so on. Most of them remain on paper and in so far as the State of MCGM is concerned, it has even failed to provide basic civil amenities in the field of transportation which includes motorable roads, health and hygiene, water supply, mass rapid transport system, disposal of solid and biomedical waste, removal of unauthorised constructions and encroachments are most of the issues which are being pursued by citizens and NGOs in various public interest litigations pending in the Courts. Therefore, we fail to understand how the subject contract which has potential to generate revenue as commercial exploitation of Bus Queue Shelters in Greater Mumbai which is the commercial capital of the country was was awarded surpassing the statutory provision only on the justification of meeting the deadline of Mumbai Transformation Project by negotiating it on the terms and conditions offered by Respondent Nos. 4 and 5 as if no other parties were ready to do it on better terms and conditions..

83. We, therefore, quash and/or set aside the ''work orders'' and / or contracts awarded to the 4th and / or 5th respondents under the Tender and the 2nd and 3rd Respondents decision extending and/or modifying the terms of the ''work orders'' and / or contracts awarded to the 4th and / or 5th respondents under the Tender and all steps or action in furtherance of or pursuant to the same during the pendency of the petition. Respondents Nos. 2 and 3 should invite fresh tenders for the subject contract as required u/s 460 M of MMC Act, 1888.

84. Rule is made absolute in the aforesaid terms. No order as to costs.