Delhi District Court
M/S Manoj Mobile Worls vs South Delhi Municipal Corporation on 15 January, 2025
IN THE COURT OF Ms. NEELAM SINGH
DISTRICT JUDGE (COMM-02),
SOUTH-EAST DISTRICT, SAKET COURT, NEW DELHI
CS (COMM)-503/19
M/s Manoj Mobile World
Sole Proprietorship of Manoj Rana
Through his Power of Attorney Holder
Sudhir Kumar
Having Office at:
K-15, Basement AB Lajpat Nagar-II,
New Delhi-110024 ..... Plaintiff
Versus
South Delhi Municipal Corporation
Through Commissioner
Dr. Shamaprasad Mukherjee Marg,
Civic Center, New Delhi .....Defendant
Date of Institution: 05.12.2019
Arguments concluded on : 14.01.2025
Date of Judgment: 15.01.2025
JUDGMENT
The crux of facts stated in brief is noted below:
Case of the plaintiff;
1. (a) It is the case of the plaintiff that plaintiff is the sole
proprietor of M/s Manoj Mobile World having its office at K-15,
Basement AB, Lajpat Nagar-II, New Delhi-110024. The
defendant is a part of the second largest civic body Municipal
Corporation of Delhi, which was trifurcated in the year 2012, into
North Delhi Municipal Corporation (NDMC), South Delhi
Municipal Corporation (SDMC), and East Delhi Municipal
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 1 of 35
Corporation (EDMC).
(b) The Defendant on 28.08.2018 issued notice inviting
tenders bearing no. RPC/SDMC.2018/D-542 for allotment of
authorized parking sites under the jurisdiction of SDMC on
monthly License Fee basis in two bid system (Technical and
Financial) for a period of five years. In the nutshell, the case of
the plaintiff is that the plaintiff participated in the bid and
defendant awarded the tender to the plaintiff and issued an offer
letter bearing no. AC/RPC/SDMC/2018/D-716 dated 18.10.2016
in favour of the plaintiff which was duly accepted by the
plaintiff. In compliance of the terms of the tender document
defendant on 02.11.2018 handed over the possession of the
parking site at Okhla Phase-I and issued a possession letter for
the same date in favour of the plaintiff.
(c) It is further the case of the plaintiff that though the parking
site was handed over to the plaintiff by the defendant but there
were disputes and litigations qua the parking site raised by the
residents/occupiers of Okhla, Phase-I against the defendant but
this fact was not told by the defendant to the plaintiff and
plaintiff has faced difficulties from day one in collecting the
parking charges. Plaintiff was required to deposit the first
monthly license fee to the tune of Rs. 15,00,000/- along with
security deposit to the tune of Rs. 45,00,000/- which was duly
deposited by the plaintiff with the defendant and defendant had
executed the receipt for the same.
(d) It is further the case of the plaintiff that in order to execute
the tender/contract, plaintiff employed the requisite staff inter-
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alia, field boys, Supervisor, office boys etc and incurred an
approximate expenses of Rs.5,00,000/- per month from his own
pocket as it was impossible for the plaintiff to execute the
agreement owing to the adverse conditions at the site.
(e) It is submitted that defendant had deliberately concealed
from the plaintiff that the Federation of Okhla Industrial
Association had filed a writ petition against the defendant and
they have also issued a number of circulars directing the
Shopkeepers, Factory-owners and their customers to refrain
themselves from paying the parking fees to the staff of the
plaintiff.
(f) It is further submitted that due to the concealment of this
fact on the part of the defendant, plaintiff has suffered huge
losses. It is also mentioned in the plaint by the plaintiff that due
to these existed circumstances, plaintiff could not perform its
obligation under the contract as it became impossible for the
plaintiff to execute the agreement and thereafter, defendant had
passed a speaking order dated 30.05.2019 without due
application of mind, which is liable to be set aside. It is further
submitted that plaintiff immediately made a representation dated
26.11.2018 to the defendant informing the defendant about the
adverse conditions prevailing at the allotment site and faced by
the plaintiff but defendant overlooked the representations and
failed to provide any aid to the plaintiff.
(g) It is further submitted that since the circumstances at the
parking site were beyond the control of the plaintiff making it
nearly impossible for the plaintiff to execute the work at site, the
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plaintiff made another representation to the defendant on
10.12.2018 and requested the defendant to implement a Joint
Program of MCD to ensure the execution of the contract but
surprisingly, the defendant in arbitrary manner and without due
application of mind passed the order dated 30.05.2019 upholding
its decision to forfeit the security amount of the plaintiff. It is
further submitted that since the defendant failed to take any
action and also failed to help the plaintiff in execution of the
tender, plaintiff filed a complaint dated 10.12.2018 against the
Okhla Industrial Association but the defendant, again, in most
arbitrary manner issued a show cause notice dated 20.12.2018 to
the plaintiff to show cause as to why the contract should not be
cancelled as the plaintiff had not paid the MLF for the month of
December. Plaintiff upon receiving this notice immediately
replied to the defendant clarifying the situation at the site by
mentioning that plaintiff is not able to execute the contract due to
the reasons which are beyond the contract of the plaintiff but
defendant did not pay any heed to his representations.
(h) Furthermore, defendant issued another show cause notice
to the plaintiff to make the outstanding payment to be made by
the plaintiff to the tune of Rs. 30,00,116/- failing which the
contract shall be cancelled and the security amount shall be
forfeited. It is further submitted that infact, due to the fraud
inflicted by the defendant upon the plaintiff, plaintiff had already
incurred expenses to the tune of Rs. 45 lakhs and also issued the
post dated cheques to the defendant but, plaintiff had to instruct
his bank for stopping the payment of the cheques given to the
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defendant on 04.02.2019. It is submitted that defendant had
cancelled the contract and further forfeited the security amount of
the plaintiff which is totally arbitrary and unlawful. It is further
submitted that plaintiff has made various representations but
defendant has not paid any heed towards these representations.
(i) It is further submitted that despite directions issued by
Hon’ble High Court of Delhi, defendant instead of passing a
speaking order in terms of compliance of their order, issued
another notice of demand dated 25.09.2019 calling upon the
plaintiff to pay the amount to the tune of Rs. 32,67,916/-. The
plaintiff aggrieved by the arbitrariness of the defendant filed a
contempt petition before Hon’ble High Court of Delhi and during
course of hearing the impugned order dated 30.05.2019 has been
handed over to the plaintiff. It is submitted that plaintiff at the
time of award of the tender had deposited with the defendant a
sum of Rs. 60 lakhs out of which Rs. 15 lakhs were the monthly
license fees for the month of November 2018 and Rs. 45 lakhs
was adjusted towards payment of the security amount for the
tender. It is submitted that the speaking order dated 25.09.2019
vide which the security amount of the plaintiff was forfeited by
the defendant be declared as null and void and defendant be
directed to refund the entire security amount of Rs. 45 lakhs
alongwith interest and hence, the present suit.
Case of the defendant;
2. (a) Written Statement has been filed on behalf of defendant by
submitting that the present suit is liable to be dismissed for want
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of mandatory notice under section 478 of the Delhi Municipal
Corporation Act, 1957. It is submitted that there is no urgency
shown by the plaintiff for waiving the issuance of the mandatory
notice to the defendant. It is submitted that plaintiff is seeking
declaration of the order dated 06.02.2019, 30.05.2019 and
payment notice dated 25.09.2019 as null and void, by filing the
present suit in the month of December 2019 which clearly
reflects that there is no urgency in order to waive the mandatory
prior notice under section 478 of Delhi Municipal Corporation
Act 1957.
(b) It is submitted in the Written Statement by the defendant
that SDMC had invited tenders on “as is where is basis” and
various bids were received in the office of the defendant. The
plaintiff’s bid in respect of the parking site at Okhla Phase-I, New
Delhi was the highest bid and was accepted by the defendant and
an Offer letter dated 18.10.2018 was issued to the plaintiff. The
time period for running of parking at the said site was for five
years at the monthly license fees of Rs. 15,00,058/- (Rupees
fifteen lakhs and fifty eight only), which was agreed upon by
both the parties and the terms and conditions of the NIT/Offer
letter were also accepted by the plaintiff.
(c) In compliance of terms and conditions of the tender,
plaintiff had deposited three months advance license fees
amounting to Rs. 45,00,174/- as security deposit by way of three
demand drafts and has also deposited one month’s advance
license fees of Rs. 15,00,058/- through demand drafts towards
License Fee for the month of November, 2018. It is submitted
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that after completion of all the formalities, the possession of the
parking site was handed over to the plaintiff on 02.11.2018 and
thus, the period of running the parking site was w.e.f.
02.11.2018.
(d) It is the case of the defendant that plaintiff had not
deposited the monthly license fees for the month of December
2018, and accordingly, the Show Cause Notice dated 20.12.2018
was issued to the plaintiff. Plaintiff again defaulted in the month
of January 2019 and further a show cause notice dated
24.01.2019 was issued to him. After issuance of both these show
cause notices and in discharge of his part liability, plaintiff had
issued a cheque No. 591651 dated 15.01.2019 for Rs. 15,00,058/-
to the defendant, but the said cheque upon its presentation was
returned unpaid for the reasons “Drawers signature to operate”.
Plaintiff had issued another cheque bearing No. 591652 dated
05.02.2019 for Rs. 15,00,058/- in the name of the Commissioner,
SDMC and this cheque was returned unpaid for the reason
“Payment stopped by drawer” and accordingly, a legal notice
under section 138 r/w Section 141 of the Negotiable Instruments
Act, 1881 has been issued to the plaintiff but no reply has been
received by the defendant.
(e) It is submitted that due to non payment of the advance
MLF for two months, the allotment of the parking site in favour
of the plaintiff was cancelled on 06.02.2019, as per the terms and
conditions of the tender and security deposit of Rs. 45 lakhs was
forfeited as per the agreed terms and conditions.
(f) It is further submitted that plaintiff approached the
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Hon’ble High Court of Delhi by filing the writ petition no.
2091/2019 challenging interalia the cancellation order dated
06.02.2019 and for restraining the SDMC from awarding the
tender of the parking site in question to the other party/bidder.
The said petition was disposed off vide order dated 07.03.2019
having become infructuous as the contract was awarded to M/s
M.S.Contractor for running the parking site in question.
However, the SDMC (defendant) was directed to afford a
personal hearing to the plaintiff on the issue of blacklisting the
plaintiff and for forfeiture of his security deposit by passing a
speaking order.
(g) It is submitted that after giving personal hearing and an
opportunity to the plaintiff to file a proper reply to the show
cause notice, the speaking order dated 30.05.2019 was passed by
the SDMC vide which it was concluded that the
contractor/plaintiff had deliberately stopped the payment of
Monthly License Fee to the defendant but continued collecting
the parking charges from the commuters from the date of handing
over the possession of the parking site i.e. 02.11.2018 upto the
date of cancellation of the contract i.e. 06.02.2019 and it was
further held that the decision of forfeiture of security deposit was
as per the terms and conditions of the NIT.
(h) It is submitted by the defendant that plaintiff did not
deposit the outstanding amount and therefore, the demand notice
under section 154 (1) of DMC Act was issued on 25.09.2019 to
the plaintiff demanding therein a sum of Rs.32,67,916/-. The
plaintiff failed to deposit the demanded amount and therefore the
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warrant of distress dated 08.11.2019 was issued to the bankers of
the plaintiff. It is submitted that the present suit is not
maintainable as plaintiff has no cause of action in his favour and
against the defendant.
(i) It is submitted that the action for cancellation and
forfeiture of the security deposit has been done as per the terms
and conditions agreed upon between both the parties and the suit
of the plaintiff be dismissed against the defendant.
3. Replication has been filed on behalf of the plaintiff, where
he has reiterated the submissions made in the plaint and has
denied the submissions made in the Written Statement by the
defendant.
4. Upon completion of the pleadings, the following issues
were framed on 09.01.2024:
1. Whether the suit of the plaintiff is not maintainable for
want of mandatory prior notice under section 478 of the Delhi
Municipal Corporation Act 1957? OPD
2. Whether there is no cause of action in favour of plaintiff
and against the defendant as plaintiff has already approached the
Hon’ble High Court of Delhi by filing the Writ petition No.
2091/2019 challenging inter alia the cancellation order dated
06.02.2019? OPD
3. Whether the cause of action has become infructuous as the
contract was awarded to M/s M.S Contractor for running the
parking site in question? OPD
4. Whether the plaintiff is entitled to declaration in favour of
plaintiff and against the defendant declaring the order dated
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 9 of 35
25.09.2019 as null and void? OPD
5. Whether the plaintiff is entitled to declaration in favour of
plaintiff and against the defendant declaring the order dated
30.05.2019 as null and void? OPD
6. Whether the plaintiff is entitled to declaration in favour of
plaintiff and against the defendant declaring the order dated
06.02.2019 as null and void? OPD
7. Whether the plaintiff is entitled to a decree in favour of
plaintiff and against the defendant for refund of the entire
security amount to the tune of Rs. 45,00,000/-? OPP
8. Whether the plaintiff is entitled for interest on the decreetal
amount, if yes, than at what rate and for which period? OPP
9. Whether the plaintiff is also entitled to the cost of the suit?
OPP
10. Relief.
5. (a) The matter then was kept for evidence. In order to prove the
case plaintiff has examined himself being proprietor of the plaintiff
firm. Sh. Manoj Rana examined himself as PW-1 and tendered his
evidence by way of affidavit Ex.PW1/X. He also relied upon the
following documents:
1.Copy of general power of attorney dated 27.02.2019 is now
Mark P-1.
2.Copy of the notice inviting tender bearing No.
RPC/SDMC.2018/D-542 dated 28.08.2018 is now Mark P-2.
3. Copy of the No Dues certificate dated 03.10.2018 is now
Mark P-3.
4.Copy of letter bearing No. AC/RPC/SDMC/2018/D-696
dated 11.10.2018 is now Mark P-4.
5.Copy of the offer letter bearing No.
AC/RPC/SDMC/2018/D-716 dated 18.10.2018 is now Mark
P-5.
6.Copy of the possession letter bearing No.
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 10 of 35
AC/RPC/SDMC/2018/D-798 dated 02.11.2018 is now Mark
P-6.
7.Copy of receipt bearing No. 1391 dated 05.11.2018
alongwith receipt bearing No. 1392 are now Mark P-7 and
Mark P-8.
8.Copy of salary receipts and documents showing the
expenses incurred by the plaintiff for the operation of the
parking site is now Mark P-9.
9.Copy of the complaint dated 16.11.2018 is now Mark P-10.
10.Copy of circular dated 21.11.2018 issued by the Okhla
Federation is now Mark P-11.
11.Copy of the important circular dated 24.11.2018 is now
Mark P-12.
12.Copy of order dated 19.11.2019 passed by Hon’ble High
Court in the W.P © No. 8945/2016 is now Mark P-13.
13.Copy of the representation dated 26.11.2018 made by the
plaintiff to the defendant is now Mark P-14.
14.Copy of the letter dated 29.11.2018 bearing No.
AC/RPC/SDMC/2018/D-873 is now Mark P-15.
15.Copy of the representation dated 10.12.2018 is now Mark
P-16.
16.Copy of complaints all dated 10.12.2018 addressed to the
SHO PS Okhla Industrial Area is now Mark P-17.
17.Copy of the show cause notice dated 20.12.2018 is now
Mark P-18.
18.Copy of the reply dated 28.12.2018 by the plaintiff
alongwith its true typed translated copy is now Mark P-19.
19.Copy of the meeting notice dated 01.01.2019 issued by the
respondent no.1 is now Mark P-20.
20.Copy of the letter dated 04.01.2019 bearing No.
RPC/SDMC/2019/D-984 issued by the defendant is now mark
P-21.
21.Copy of show cause notice dated 24.01.2019 is now Mark
P-22.
22.Copy of letters dated 04.02.2019 written by plaintiff bank
confirming stop payment of cheques sought by plaintiff are
now Mark P-23 and Mark P-24.
23.Copy of impugned demand order dated 06.02.2019 is now
Mark P-25.
24.Copy of the representation dated 12.02.2019 is now Mark
P-26.
25.Copy of the NIT bearing No. RPC/SDMC.2019/D-1019
dated 24.01.2019 alongwith corrigendum dated 07.02.2019 is
now Mark P-27.
26.Copy of impugned demand order dated 30.05.2019 is now
Mark P-28.
26.Copy of order dated 07.03.2019 passed by the Hon’ble
High Court in writ petition bearing No. 2091 of 2019 is now
Mark P-29.
27.Copy of letter dated 27.03.2019 is now Mark P-30.
28.Copy of letter dated 28.03.2019 is now Mark P-31.
29.Copy of representation dated 01.04.2019 is now Mark
P-32.
30.Copy of email dated 20.08.2019 is now Mark P-33.
31.Copy of email dated 23.08.2019 is now Mark P-34.
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 11 of 35
32.Copy of impugned demand order dated 25.09.2019 is now
Mark P-35.
33.Copy of screenshot showing balance in negative/account of
the plaintiff being attached is now Mark P-36.
34.CD containing the CCTV footage showing the problems
being faced by the plaintiff in the execution of the agreement
is now Mark P-37 (colly).
35.Certificate under section 65B Indian Evidence Act is now
Ex.PW1/A.
(b)(i) Plaintiff has relied upon the abovesaid documents but
admittedly, most of the documents relied upon by the plaintiff are
the photocopies. PW-1 has been cross examined at length by Ld.
Counsel for defendant. In his cross examination, he has admitted
that the contract in question is the only contract of the plaintiff
with the MCD. He has admitted that he was aware that MCD had
floated the tenders for parking on “as is where is basis”. He
admitted that the tender as well as agreement was signed by him.
On a question put to him whether he has signed the tender as well
as the agreement, then, after reading the same, the witness stated
that he has not read the terms and conditions of the tender and the
agreement. He admitted that as per the terms and condition of the
tender and agreement, the plaintiff had to deposit three months
monthly license fees as security and one month monthly license
fees as advance license fees and he had deposited both these
amounts. He denied the suggestion that the parking site was
handed over to him on 02.11.2018 by MCD. He has admitted that
Sh. Sudhir was appointed by him for running parking site and Sh.
Sudhir was appointed at the time of filling up the tender in
question by him. He has stated that the MCD has given the
parking site to the plaintiff qua which the litigation was going on
between some Okhla, Phase-I, Association and MCD.
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(ii) The witness has been shown letter dated 02.11.2018 and he
has admitted the signatures of Sh. Sudhir being his representative.
The letter is Ex.PW1/DX1. The witness has also been shown
cheque dated 15.01.2019 and he has stated that Sh. Sudhir had
signed on the cheque as proprietor. He has admitted the fact that
he is not the proprietor of M/s Manoj Mobile World. He has
admitted that he has not placed on record any authrization in
favour of Sh. Sudhir.
(iii) On a question asked to him as to why he has made payment
to the staff kept at the parking site, he has given answer that the
plaintiff has kept his staff from the date the tender was allotted to
him, even though the physical possession of the parking site was
handed over by the defendant late.
(iv) The witness was further cross examined on 03.09.2024 and
he has stated that he did not know if any other parking site was
being run by MCD in Okhla Industrial Area. He has denied the
suggestion that MCD has concealed any fact about the pending
litigation between the Okhla Federation, MCD and DSIIDC. He
is not aware whether the MCD is running the parking sites in
question before giving the site to the plaintiff. He has denied the
suggestion that the pending litigation has done adverse effect on
the running of the parking site by the plaintiff. He has admitted
the fact that all the parking sites are being run by MCD. He has
denied the suggestion that he is aware about the pending
litigation for parking site. He has denied the suggestion that he is
not intending to pay the license fees to the MCD and for that
reason he has concocted the story of pending litigation. He has
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denied the suggestion that he has not placed on record relevant
documents pertaining to the fact that he had spent Rs. 5 lakhs per
month on the site of the parking. He has denied the suggestion
that he has not suffered any huge losses or had incurred any
expenses which has been claimed by him in the present suit.
(v) He has denied the suggestion that he was running the
parking site smoothly without any complaint and was earning
huge profit from the said parking site. He has admitted that the
speaking order was passed after considering his objection/reply
and after giving him personal hearing. He has also admitted the
fact that the CCTV was installed at the parking site by the MCD
before the possession of the land was given to him. He has
admitted the fact that the meeting notice was issued by the MCD
on 01.01.2019. He has also admitted the fact that two cheques
given by him for outstanding dues for two months were got
dishonoured. He has denied the suggestion that the cheques were
given by the plaintiff for outstanding amount as the parking site
was being run by the plaintiff.
(vi) He has further stated that that he was not aware if license
fees is pending, then, MCD can cancel the license of the parking
area. He has denied the suggestion that in order to escape his
liability from paying charges to the defendant, he has concocted a
false story. He has admitted his letter dated 26.02.2019 sent by
him to MCD. He has denied the suggestion that he is not entitled
to any refund from defendant rather, the defendant is entitled for
recovery from plaintiff. Thereafter, PE was closed.
6. Defendant did not lead any evidence and DE was closed.
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7. Final arguments heard. Record perused carefully. I have
gone through the testimony of the plaintiff’s witness and on the
basis of arguments rendered by both the parties, documents,
pleadings and testimony of PW-1, my issue wise findings are as
follows:
Issue No.1: Whether the suit of the plaintiff is not
maintainable for want of mandatory prior notice under section
478 of the Delhi Municipal Corporation Act 1957? OPD
8. The onus to prove the said issue was upon the defendant. It
is argued by Ld. Counsel for defendant that this is a cardinal
principal of law in the light of section 478 of Delhi Municipal
Corporation Act, 1957 that no suit shall be instituted against the
corporation unless notice in writing has been delivered to the
concerned official of the corporation. It is further argued by Ld.
Counsel for defendant that plaintiff has not shown any urgency in
any manner which prohibited him from issuing the notice to the
defendant under section 478 of Delhi Municipal Act, 1957. It is
further argued that vide the present suit, the plaintiff is seeking
only the declaration of the order dated 06.02.2019, 30.05.2019
and demand notice dated 25.09.2019 as null and void and
admittedly, has not asked for any relief of injunction and in the
absence of any such relief of injunction, he is duty bound to issue
prior notice to the defendant which he has utterly failed. It is
further argued that admittedly the present suit has been filed by
the plaintiff in the month of December 2019 i.e. much after these
aforesaid orders/notices which clearly reflects that there was no
urgency for the plaintiff in order to waive the mandatory prior
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notice under section 478 of the Delhi Municipal Corporation Act,
1957 and henceforth, the present suit is liable to be dismissed on
account that the provisions under section 478 of the Delhi
Municipal Corporation Act, 1957 has not been fulfilled by the
plaintiff.
9. Per contra, it is argued by Ld. Counsel for the plaintiff that
issuance of notice under section 478 of Delhi Municipal
Corporation Act, 1957 is not mandatory in any manner. It is
further argued that defendant has issued the demand notice on
25.09.2019 and the present suit has been filed on 05.12.2019. It is
submitted that there was an urgency and for that reason prior
notice within the meaning of Section 478 Delhi Municipal
Corporation Act, 1957 has not been issued by the plaintiff to the
defendant. It is further argued by Ld. Counsel for the plaintiff
that the parties were already in dispute for more than one year
and there were exchange of communication between the parties
and for these reasons, there was no requirement of the mandatory
notice under section 478 of Delhi Municipal Corporation Act,
1957.
10. On the basis of the arguments of both the parties, let’s first
consider the provisions of Section 478 of Delhi Municipal
Corporation Act, 1957.
478 “Notice to be given of suits.-(1) No suit shall be instituted against 1[2[the
Corporation]] or against any municipal authority or against any municipal officer or
other municipal employee or against any person acting under the order or direction
of any municipal authority or any municipal officer or other municipal employee, in
respect of any act done, or purporting to have been done, in pursuance of this Act or
any rule, regulation or bye-law made thereunder until the expiration of two months
after notice in writing has been left at the municipal office and, in the case of such
officer, employee or person, unless notice in writing has also been delivered to him
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 16 of 35
or left at his office or place of residence, and unless such notice states explicitly the
cause of action, the nature of the relief sought, the amount of compensation
claimed, and the name and place of residence of the intending plaintiff, and unless
the plaint contains a statement that such notice has been so left or delivered.
(2) No suit, such as is described in sub-section (1), shall, unless it is a suit for the
recovery of immovable property or for a declaration of title thereto, be instituted
after the expiry of six months from the date on which the cause of action arises.
(3) Nothing in sub-section (1) shall be deemed to apply to a suit in which the only
relief claimed is an injunction of which the object would be defeated by the giving
of the notice or the postponement of the institution of the suit”
11. Perusal of record shows that plaintiff has also not preferred
pre mediation within the meaning of Section 12A of the
Commercial Courts Act, 2015.
12. I could lay my hands on the judgments passed by Hon’ble
High Court of Delhi in cases titled “Ram Pratap Singh Nayyar
Vs. Municipal Corporation of Delhi & Anr. CS (OS) No.
234/2011, Joginder Kaur & Anr. Vs. Municipal Corporation of
Delhi & Anr. CS (OS) No. 235/2011, Smt. Amarjeet Kaur Vs.
Municipal Corporation of Delhi & Anr. CS (OS) No. 236/2011
and Jagdish Kumar Bajaj Vs. Municipal Corporation of Delhi &
Anr. CS (OS) No. 237/2011″. Relevant portion of the judgment is
reproduced herein under:
3. Section 478 of MCD Act to the extent it is relevant provides that no suit shall be
instituted against the Corporation or against any municipal authority or against any
municipal officer or other municipal employee or against any person acting under
the order or direction of any municipal authority or any municipal officer or other
municipal employee, in respect of any act done, or purporting to have been done, in
pursuance of this Act or any rule, regulation or bye-law made thereunder until the
expiration of two months after notice in writing has been left at the municipal office
and, in the case of such officer, employee or person, unless notice in writing has
also been delivered to him or left at his office or place of residence, and unless such
notice states explicitly the cause of action, the nature of the relief sought, the
amount of compensation claimed, and the name and place of residence of the
intending plaintiff, and unless the plaint contains a statement that such notice has
been so left or delivered.
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 17 of 35
Sub-Section (3) of the above referred Section provides that the provisions of sub-
section (1) shall not apply to a suit in which the only relief claimed is an injunction
of which the object would be defeated by the giving of the notice or the
postponement of the institution of the suit.
4. The provisions of Section 478 of DMC Act are analogous to provisions of
Section 53B of Delhi Development Act, which reads as under:-
“(1)No suit shall be instituted against the Authority, or any member thereof, or any
of its officers or other employees or any officer or other employee of the Authority
in respect of any act done or purporting to have been done in pursuance of this Act
or any rule or regulation made there under until the expiry of two months after
notice in writing has been, in the case of the Authority, left at its office, and in any
other case, delivered to, or left at the office or place of abode of, the person to be
sued and unless such notice states explicitly the cause of action, the nature of relief
sought, the amount of compensation claimed and the name and place of residence
of the intending plaintiff and unless the plaintiff contains a statement that such
notice has been so left or delivered.
(2) No suit such as is described in sub-Section (1) shall, unless it is a suit for
recovery of immoveable property or for a declaration of title thereto, be instituted
after the expiry of six months from the date on which the cause of action arises.”
5. The provisions of Section 53B of Delhi Development Act came up for
consideration before a Division Bench of this Court in D.C.M. Ltd. vs. Delhi
Development Authority 1995 III AD (Delhi) 952. In that case the suit was for
declaration of title as regards immovable property and it was found that a notice as
envisaged under Section 53B of Delhi Development Act had not been left or
delivered at the office of DDA. It was held that Section 53B of the Delhi
Development Act like Section 80 of the Code of Civil Procedure is mandatory and
its compliance is imperative. It was further held that a suit not complying with such
like provisions cannot be entertained by any Court and if instituted must be rejected
under Order 7 Rule 11 of Code of Civil Procedure. In taking this view this Court
relied upon the decision of Supreme Court in Gangappa Gurupadappa Gugwad vs.
Rachawwa and Others [1971] 2 SCR 691 and Bichari Chowdhary vs. State of Bihar
[1984] 3 SCR 309.
Since injunction is not the only relief claimed in the suit, the plaintiff having
claimed possession as well as recovery of money, the suit is not saved by sub-
section (3) of Section 478 and consequently it is hit by the provisions of sub-section
(1) of Section 478 of the DMC Act.
6. There is no provision in DMC Act for any exemption from the requirement of
serving notice under sub-section (1) of Section 478 of DMC Act. Section 80(2) of
the Code of Civil Procedure, to the extent it is relevant provides that a suit to obtain
an urgent or immediate relief against the Government or any public officer in
respect of any act purporting to be done by such public officer in his official
capacity, may be instituted, with the leave of the Court, without serving any notice
as required by sub- section (1). Since MCD is not Government, the provisions of
sub-section (2) of Section 80 of Code of Civil Procedure do not apply to a suit filed
against it.
7. This issue came up for consideration before a Division Bench of this Court in
Smt. Prinda Punchi and Anr. vs. Municipal Corporation of Delhi and Ors. 2005 IV
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 18 of 35
AD (Delhi) 639. In that case, an application had been filed by the appellant under
Section 80(2) of the Code of Civil Procedure seeking leave to institute the suit
without service of statutory notice. Noticing that there is no provision for such a
leave under Section 53B of Delhi Development Act, the Court and examining the
provisions contained in Section 80(2) of the Code of Civil Procedure, Section 53B
of Delhi Development Act and Section 478 of Delhi Municipal Act, the Court inter
alia observed as under:-
A bare perusal of the statutory provisions shows that the legislature had carefully
ordered the statutory provisions keeping in view the spirit, indictment and purpose
of the discretion conferred to waive the requirement of the statutory notice.
Keeping in view the exigencies of the matter, Section 53B of the Delhi
Development Act knows of no exemptions or waiver. The aforesaid provision of
section 53B was enacted long after enactment of the provision of sub-section (2) of
section 80 of the CPC. The legislature was aware of the said provision of sub-
section (2) of section 80 CPC when section 53B of the Delhi Development Act was
enacted.
Consciously the legislature did not incorporate in section 53B of the Delhi
Development Act any exception as that of sub-section (2) of section 80 CPC.
therefore, it would not be appropriate to include and add such provision as that of
sub-section (2) of section 80 CPC into the provision of section 53B of the Delhi
Development Act. On the contrary the legislature has consciously referred to a suit
for declaration of title in Section 53B(2) of the statute. It is settled law that a statute
has to be enforced as it exists. No words can be imported into the specific language
used by the legislature.
The law of interpretation of statutes clearly provides that there can be no addition
or subtraction to the language of a statute when the same is clear and unambiguous.
There is no unambiguity or uncertainty in the language of section 53B and,
therefore, there is no scope of adding any words to the said existing provision in the
statute. Finding that the appellant was disputing title and therefore had to bring a
suit for declaration and there being no provision in Section 53B of Delhi
Development Act for leave of the Court to bring a suit without any notice like
notice under Section 80(2) of the Code of Civil Procedure, it was held that in a suit
seeking a decree for declaration as also mandatory injunction a notice had to be
given under Section 80 of Code of Civil Procedure as also under Section 53(B) of
Delhi Development Act.
8. Hence, Section 80(2) of Code of Civil Procedure cannot be applied in a suit
attracting applicability of Section 478 of DMC Act, 1957 or Section 53B of Delhi
Development Act. In any case it cannot be said that the relief of possession and
recovery of money sought by the plaintiff are urgent or immediate reliefs. Hence,
sub-section (2) of Section 80 of Code of Civil Procedure in any case is not
attracted.
9. Order VIII Rule 11 of the Code of Civil Procedure, to the extent it is relevant,
provides that the plaint shall be rejected where the suit appears from the statement
in the plaint to be barred by any law. Since the suits are apparently barred by the
provisions contained in Section 478(1) of DMC Act, the plaints are rejected under
Section 11(d) of the Code of Civil Procedure. The plaintiff in each case shall be at
liberty to present a fresh plaint after serving the requisite notice under Section
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 19 of 35
478(1) of the DMC Act on the defendants. The plaint be accordingly returned to the
plaintiff for being presented after serving requisite notice.
13. It has been held in these following cases that issuance of
notice under section 478 of Delhi Municipal Corporation Act,
1957 is mandatory. It has been held in the aforesaid cases as well
as in various cases decided by our own High Court that whenever
any suit is filed against any of the limb of the Government or its
agencies, then issuance of prior statutory notice is mandatory and
it can only be waived off in exceptional circumstances where the
relief of injunction is sought by the party concerned and the
issuance of prior statutory notice may adversely affect the right
of the plaintiff due to time frame.
Accordingly, issue no.1 is decided in favour of defendant
and against the plaintiff.
Issue No. 2: Whether there is no cause of action in favour
of plaintiff and against the defendant as plaintiff has already
approached the Hon’ble High Court of Delhi by filing the Writ
petition No. 2091/2019 challenging inter alia the cancellation
order dated 06.02.2019? OPD Issue No.3: Whether the cause of
action has become infructuous as the contract was awarded to
M/s M.S Contractor for running the parking site in question?
OPD Issue No. 4: Whether the plaintiff is entitled to declaration
in favour of plaintiff and against the defendant declaring the
order dated 25.09.2019 as null and void? OPD Issue No.5:
Whether the plaintiff is entitled to declaration in favour of
plaintiff and against the defendant declaring the order dated
30.05.2019 as null and void? OPD Issue No.6: Whether theCS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 20 of 35
plaintiff is entitled to declaration in favour of plaintiff and against
the defendant declaring the order dated 06.02.2019 as null and
void? OPD
14. All these issues are taken together at the request of Ld.
Counsel for the defendant being interlinked to all the prayer of
the plaintiff. It is argued by Ld. Counsel for the defendant that
before filing the present suit in this court plaintiff had approached
Hon’ble High Court of Delhi by filing the writ petition No.
2091/2019 challenging the cancellation order dated 06.02.2019
and for restraining the defendant from awarding the tender of the
parking site in question to the other party/bidder. It is argued that
the said petition was disposed off vide order dated 07.03.2019
having become infructuous as the contract was already awarded
to M/s M.S. Contractor for running a parking site in question. It
is submitted that Hon’ble High Court while disposing off the
petition directed the defendant to afford a personal hearing to the
plaintiff on the issue of blacklisting the plaintiff and for forfeiture
of his security deposit by passing a speaking order. It is further
argued that defendant had afforded personal hearing and an
opportunity to the plaintiff to file proper reply to the show cause
notice of the defendant and thereafter, passed the speaking order
dated 30.05.2019 by holding that the plaintiff had deliberately
stopped the payment of monthly license fees to the defendant but
continued collecting the parking charges from the commuters
from the date of handing over the possession of the site i.e.
02.11.2018 upto the date of cancellation of the contract i.e.
06.02.2019.
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 21 of 35
15. It is further submitted that in the speaking order dated
30.05.2019 it was further held that the decision of forfeiture of
security deposit was as per the terms and conditions of the NIT. It
is further submitted that even thereafter plaintiff did not deposit
the outstanding amount and defendant further issued demand
notice under section 154 (1) of DMC Act for a sum of Rs.
32,67,916/-. Since plaintiff further failed to comply the notice,
therefore, warrant of distress dated 08.11.2019 was issued to the
banker of the plaintiff i.e. Axis Bank Ltd. and HDFC Bank.
16. It is argued that in the light of the disposal of the writ
petition of the plaintiff by Hon’ble High Court of Delhi and also
the compliance done by the defendant of the order of Hon’ble
High Court of Delhi and also in view of the fact that personal
hearing and due opportunity has been provided to the plaintiff
before passing the speaking order, the present suit is not
maintainable as plaintiff has no cause of action in his favour and
against the defendant. It is further argued that the cancellation
and forfeiture of the security deposit has been done by the
defendant as per the terms and conditions agreed upon between
both the parties. It is argued that plaintiff has failed to point out
as to which clause/terms and conditions of the NIT or allotment
permits the plaintiff for refund of the forfeited amount of security
when the breach of terms and conditions are attributable to the
plaintiff alone and action by the defendant was taken as per the
terms and conditions agreed upon between both the parties. It is
further argued that it has been duly admitted by the plaintiff that
the site in question was given to plaintiff on “as is where is
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 22 of 35
basis”. It is further submitted that defendant has allotted the
parking site to so many other contractors but from nowhere any
such complaint as that is raised by the plaintiff has been received
by the defendant. It is submitted that plaintiff is trying to wriggle
out the liability of paying the outstanding dues to the defendant
by making false mischievous and baseless allegations against the
SDMC.
17. I have gone through the terms and conditions of the open
tender notice dated 28.08.2018. Section II of this document
contains the “Instructions to Bidders” and clause 10 (A) deals
with the termination of the contract which is reproduced as
under:
10. (A) Termination of the contract:
a) SDMC shall also have the right to terminate this Agreement by giving
thirty (30) days prior written notice to the Contractor without assigning any
reason to the Contractor.
b) In the event, the land of the Parking Lot is required or taken from SDMC
by any Government Authority under any Applicable Laws, then in that case,
the said Agreement shall automatically stand terminated and Contractor have
no right to claim any damages, cost or expenses etc. from SDMC in any
manner.
18. It is argued by Ld. Counsel for the defendant that if the
plaintiff/contractor was not able to execute the contract it was
ought to be on the part of the plaintiff to surrender the contract
with the defendant. It is argued that clause 16 of the terms and
conditions deal with the aspect of surrender of the parking license
allotted to the plaintiff. Clause 16 is reproduced as under:
16. Surrender:
a. In the event of tender of parking license by the Parking contractor the right
of acceptance or rejection solely rests with the competent authority, SDMC.
b. in the case of surrender of the parking without approval of the competent
authority of SDMC, Security deposit shall not be adjusted against the license
fee of remaining months and shall be either forfeited or refunded after the
determination of the license.
c. Forfeiture of Performance Guarantee- in case of Termination/Cancellation
of the contract except for force majeure conditions the performance guarantee
shall be forfeited.
d. The Parking contractor, who has surrendered a site, shall not be eligible to
participate in the tender process of the same site again at least for twoCS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 23 of 35
consecutive terms/tenders. To this effect an undertaking shall be given by the
parking contractor.
e. If, any contractor surrenders any site under SDMC on three different
occasions, he shall be debarred from participating in future NITs of SDMC
for a period as determined by competent authority.
f. The above mentioned conditions shall not apply in case of force majure
where the surrender is on account of reasons beyond the control of the
contractor.
19. It is further argued that as per the additional terms and
conditions for award of contract of parking site, in case of non
payment of license fees a detailed provision has been mentioned
in clause 13 at page 88 of the document filed on behalf of
plaintiff. Clause 13 of this document deals with Non Payment of
License Fee and is reproduced as under:
Clause 13 deals with Non-payment of License Fee:
If the payment is not made in the manner stipulated abové i.e. if payment of
MLF of the succeeding month is not made by the last day of the preceding
month, the parking contractor shall be liable to deposit MLF with 24% per
annum interest within first 15 days of the succeeding month, failing which
the contract shall be deemed to have been terminated and security
deposit/performance guarantee forfeited, without any notice.
However, the Commissioner, SDMC or any other officer authorized by him,
in this behalf, may on consideration of a representation of the contractor
restore the parking site, subject to deposition of a restoration fees of 10% of
the annual value of contract along with outstanding license fee and interest,
penalty etc., for the intervening period & provided that the request for
restoration (of contract) is made within 10 days of the termination of
contract by the contractor.
The decision of the Commissioner or any other officer authorized by him,
after termination of the contract and to charge restoration fee or any other
amount as may be prescribed for the purpose, shall be final and binding
upon all. Any dues in this regard will be recoverable as arrears of MLF, if
any.
20. It is further argued that even clause 16 of the aforesaid
document which is available at page 89 clearly states that
security deposit by the contractor shall not be adjusted in MLF.
Clause 16 is reproduced as under:
16 Security deposit/performance guarantee.
Payment of Security Deposit/ Performance Guarantee is to be made in the
manner prescribed in Anncure-9 before the parking site is handed over to
successful highest bidder. The security deposit will not be adjusted against
M.L.F of the current ‘site/contract’ but the same will be either adjusted against
the dues liability of other sites of the same parking contractor, with SDMC or
will be refunded after successful completion of contract period, without any
interest upon it however, subject to deductions/ forfeiture which may be
applicable on account of non performance, as the case may be. The decision
of the competent authority, in this regard shall be final and binding upon all.
21. Ld. Counsel for the defendant further argued that the non
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 24 of 35
compliance on the part of plaintiff resulted into loss of revenue to
the government and ultimately resulted into loss of public money.
It is further argued that clause 37 of the aforesaid document,
which is available at page 93 of the documents clearly states
about the action taken by the defendant against the violators.
Clause 37 is reproduced as under:
Recovery of dues including MLF
In case of parking contractor fails to deposit his dues as per the conditions of
the contract including the MLF or the advance cheques presented by him are
not honoured by the issuing bank due to whatever reason, action under the
relevant clause of the contract agreement shall be taken against him.
Apart from any such action, the contractor shall be liable for initiation of the
criminal proceedings under relevant clause of Cr. PC/IPC any other remedies
available with the corporation under the law of the land. The charges payable
by the contractor are also liable to be recovered as revenue due to SDMC and
recovery proceeding under relevant provision (s) of DMC Act shall be taken
against defaulting contractor.
22. It is further argued by Ld. Counsel for defendant that
plaintiff was aware about all the terms and conditions of the NIT
and more particularly about annexure 9 (document at page 97)
and at serial no.3 it has been mentioned in detail that monthly
license fees has to be deposited in the shape of demand
draft/banker’s cheque/pay order etc. Clause 3 of the aforesaid
document is reproduced as under:
3 Clause No 11, 12, Annexure 5
Monthly License Fee (MLF) First MLF to be deposited in advance, along
with Security Deposit/Performance Guarantee. (To be deposited by H-1
bidder at the time or acceptance of offer letter issued by RP Cell) MLF for the
succeeding month shall be payable on or before last day of the preceding
month.
Equivalent to bid amount Le. MLF accepted by SDMC.
Monthly License Fees has to be deposited in the shape of Demand
Draft/Bankers Cheque/Pay order or through RTGS/ECS in the SDMC A/c.
The preferred bidder shall be required to deposit 60 post dated cheques
against the Monthly License Fees payable by him.
If the H-1 bidder does not complete the formalities within 7 working days of
issue of offer letter, they will be liable to pay MLF immediately from the 8 th
working day.
23. It is further argued that even despite knowing about these
aforementioned provisions, plaintiff willfully issued two cheques
and thereafter, with malafide intention got these cheques
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 25 of 35
dishonoured by making stop payment of these cheques.
24. Ld. Counsel for defendant further argued that all the pleas
taken by the plaintiff in this case are just the bald pleas and the
same can be understood in the letter of plaintiff dated 26.02.2019
which is written to the defendant by him and is as Ex.PW1/D1. It
is submitted that vide this letter plaintiff has requested for
withdrawal of cancellation order dated 06.02.2019 by submitting
that the undersigned (plaintiff) is ready to undertake to abide by
the terms and conditions of the NIT and also ready to make the
balance payment towards MLF for the month of December and
January. The content of this letter is reproduced as under:
The undersigned was allotted a parking site in pursuance of NIT NO. 542
28.08.2018, in Okhla Phase-1, being H-1 bidder in the NIT and the said
parking site was handed over to me on 02.11.2018 @ MLF 15,00,058 for a
period of three years.( Extendable further two years).
Accordingly The undersigned had deposited three month security amounting
Rs. 45, 00000/- and one month advance MLF amounting Rs. 15, 0000/- for
the period 01.11.2018 to 30.11.2018.
The undersigned had also given cheque for advance payment of two months
MLF but the undersigned was compelled to request the bank for stop
payment, as the deptt. despite request dated 28.12.2018, failed to address the
issues raised by the undersigned, as the undersigned was unable to run the
paring smoothly. The undersigned is continuously meeting the concerned
officials in this regard, however, the deptt. Instead of addressing the issues
raised by the undersigned, chose to pass cancelation order dated 06.02.2019,
without affording an opportunity of personal hearing.
It is further submitted that the undersigned is ready to undertake to abide by
the terms and conditions of the NIT and also ready to make the balance
payment towards MLF for the month of December and January.
In view of the above facts and submissions, it is, therefore, requested to
withdraw the cancelation orders dated 06.02.2019 and allow the undersigned
to run the parking site.
25. By referring this letter, Ld. Counsel for the defendant has
apprised the court that the suit of the plaintiff literally lacks cause
of action and plaintiff has simply concocted a story for non
payment of MLF and for recovery of security deposit which the
defendant has forfeited as per the terms and conditions of the
contract.
26. Per contra, it is argued by Ld. Counsel for the plaintiff that
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 26 of 35
though the site in question was handed over to the plaintiff by the
defendant on 02.11.2018 but the Welfare Association of Okhla
Industrial Area had issued a circular for non payment of parking
charges to the plaintiff. It is submitted that this fact was never
disclosed to the plaintiff by the defendant and defendant allured
the plaintiff for deposition of security deposit and one month’s
advance MLC amounting to Rs. 45 lakhs and Rs. 15 lakhs
respectively. It is submitted that after taking the possession of the
parking site from the defendant, plaintiff has made several
complaints to the defendant about the fact that the local people of
the vicinity have not acknowledged the plaintiff to collect the
parking charges and raised these objections even within 15 days
of the possession of parking area. It is further submitted that
plaintiff has written number of letters to the defendant that he is
being harassed by the association and also being threatened by
the association with dire consequences and directed him for not
collecting the parking charges but nothing has been done by the
defendant towards the representation of the plaintiff which were
made on 29.11.2018. It is further submitted that plaintiff has also
written a letter regarding this aspect on 10.12.2018.
27. It is further submitted that though the plaintiff issued two
cheques towards MLF but there was no corporation on behalf of
defendant, hence, plaintiff was forced to ask for the stop payment
of both the cheques as a lot of hindrances were created by the
association and the problem of the plaintiff was never solved by
the defendant. Ld. Counsel for the plaintiff has further argued
that the site allotted to the plaintiff was not free from
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 27 of 35
encumbrances, which, it was suppose to be before being allotted
the same to the plaintiff. Rather, there was a dispute between the
association of traders and welfare associations and also one party
being DSIDC which prohibited the plaintiff for collecting the
parking charges from the users and the inaction on the part of
defendant further resulted in huge loss to the plaintiff. It is
submitted that since the date of filling the tender, plaintiff had
spent approximately Rs. 5 lakhs per month for the salary of the
employees which he has hired for managing and maintaining the
parking site in question.
28. It is further argued that cancellation of the tender and
forfeiture of security deposit by the defendant is totally arbitrary
and infact, it is the inaction on the part of defendant which led to
the huge losses to the plaintiff and defendant be directed to return
the security amount alongwith one month’s MLF with interest to
the plaintiff. It is further submitted by Ld. Counsel for plaintiff
that defendant has even written letter to the association for
resolving the dispute which shows that plaintiff was unable to
collect the parking charges from the site.
29. The main contention of Ld. Counsel for plaintiff is that the
dispute on the parking site was in the knowledge of the defendant
which was intentionally not told to the plaintiff and due to the
dispute at the site, plaintiff was not able to collect the parking
charges and since the plaintiff has not collected the charges so the
payment could not be made to the defendant and accordingly,
plaintiff is entitled for refund of security deposit alongwith
interest.
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 28 of 35
30. It is further argued by Ld. Counsel for plaintiff that
defendant was harping upon to cancel the tender of the plaintiff
and this conduct of the defendant could very well be judged in
the fact that the tender of the plaintiff was cancelled on
06.02.2019 and the tender was re-issued by the defendant on
24.01.2019. It is submitted that on 24.01.2019, defendant had
issued show cause notice to the plaintiff and on the same date, re-
issued the tender for the same site.
31. Ld. Counsel for the defendant has further argued on one
more aspect by submitting that the present case has been filed by
the title of M/s Manoj Mobile and it is the case of the plaintiff
that plaintiff Sh. Manoj Rana is the sole proprietor of the plaintiff
company but the suit has been filed by his power of attorney
holder Sh. Sudhir Kumar which is not allowed in law. It is
submitted that only photocopy of general power of attorney has
been filed by the plaintiff executed by Mr. Manoj Rana in favour
of Mr. Sudhir Kumar. It is submitted that even this general power
of attorney does not mention the title of the present case and is
very generic in nature.
32. Ld. Counsel for the defendant has relied upon the
judgment passed by Hon’ble High Court of Delhi in case titled
“Miraj Marketing Corporation Vs. Vishaka Engineering & Anr.”
Para 11 and 12 of the judgment are reproduced as under:
11. Be that as it may, we may also now look to the second contention which
was advanced before us and was hotly debated. It was submitted that the suit
was instituted in the name of the proprietorship firm and, therefore, the said
suit was not maintainable. The learned trial court also upheld the said
contention and dismissed the suit on that score also. Therefore, the aforesaid
plea is very relevant and calls for in depth consideration by us. A
proprietorship firm has no legal entity like a registered firm. A suit cannot be
instituted in the name of an unregistered proprietorship firm and the said suit
is to be instituted in the name of the proprietor. It is an admitted position inCS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 29 of 35
the plaint that the plaintiff is a proprietorship firm. There is, however, no
statement made in the plaint by the plaintiff as to who is the proprietor of the
firm. Shri Amitabh Sharma is described in the cause title of the plaint only as
an authorised representative. The name of the proprietor of the said
proprietorship firm is not given in the plaint. The original plaint which is
placed on record has a verification. However, the signature appended to the
said verification appears to be that of Shri. A.K. Pandey, who was examined
in the suit as PW-2, as the main witness. He stated in his cross-examination
that he was the proprietor of the plaintiff firm. He also stated in his cross-
examination that the plaint was signed, filed and verified by him. PW-1 also
in his cross-examination stated that the plaintiff firm was a proprietorship
firm and that Shri A.K. Pandey was the sole proprietor of the plaintiff firm. It
was, however, stated by him that the plaintiff firm was a registered firm but
he could not state as to when the said firm was registered. It is apparent that
Shri A.K. Pandey had not instituted the suit. He had only come as a witness.
Even in the amended plaint the suit was shown to have been instituted in the
name of the firm. A sole proprietorship firm is not a legal entity which can sue
or be sued in its own name. Such suit relating to or against the affairs or
claims of a proprietorship concern has to be brought or made against the
person who is the sole proprietor of the firm. The plaintiff was described to be
a proprietorship firm and represented through Shri Amitabh Sharma. Shri
Amitabh Sharma had neither signed the plaint nor he signed the power which
was filed in the present case.
12. In that view of the matter, we agree with the findings and the conclusions
recorded by the trial court that the suit was not instituted by a duly authorised
person. Accordingly, we find no infirmity in the judgment and order passed by
the learned trial court dismissing the suit on the ground tha the suit was not
properly instituted”.
33. On the other hand, it is argued by Ld. Counsel for plaintiff
that a general power of attorney has been executed by plaintiff in
favour of Sh. Sudhir Kumar which is very ellaborate and is
allowed in law.
34. Considering the submissions of both the parties, I have
noticed that there are certain admitted facts that defendant/SDMC
had invited tenders vide NIT No. 542 dated 28.08.2018 for
various parking sites under its jurisdiction in New Delhi on “as is
where is basis” and received various bids from the contractors.
The plaintiff’s bid in respect of the site in question i.e. Okhla,
Phase-I, New Delhi was accepted by the defendant and an offer
letter dated 18.10.2018 was issued to the plaintiff. The terms and
conditions of the NIT/offer letter were accepted by the plaintiff
and defendant. In compliance with terms and conditions of the
tender, the plaintiff had deposited three months license fees
amounting to Rs. 45,00,174/- as security deposit alongwith one
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 30 of 35
month advance license fees of Rs. 15,00,058/- by way of demand
drafts. It was agreed upon between both the parties that the
monthly license fees of parking site shall be payable in advance
in respect of every month by the plaintiff. It is an admitted fact
that the possession of the parking site was handed over to the
plaintiff on 02.11.2018 for running the parking site w.e.f.
02.11.2018. The plaintiff had not deposited the advance monthly
license fees for the month of December 2018 and therefore,
defendant issued a show cause notice dated 20.12.2018 to the
plaintiff to show as to why the allotment be not cancelled.
Plaintiff again defaulted in the payment of monthly license fees
for the month of January 2019 and again a demand cum show
cause notice 24.01.2019 was issued demanding Rs. 30,00,116/-.
In discharge of its part liability plaintiff had issued cheque No.
591651 dated 15.01.2019 for Rs. 15,00,58/- in the name of
Commissioner SDMC but admittedly, the said cheque on
presentation was dishonoured. Furthermore, another cheque
issued by the plaintiff being cheque No. 591652 dated
05.02.2019 for Rs. 15,00,58/- again dishonoured for the reason
“Payment Stopped by Drawer”. This is an admitted fact that
defendant cancelled the contract for the parking site on
06.02.2019 due to non payment of the advance MLF for two
months and also forfeited the security deposit of Rs. 15 lakhs. All
these actions done by the defendant find support from the
mutually agreed documents executed between the parties and
more particularly, in view of clauses 3, 10 (A), 13, 16 and 37 of
the documents filed by the plaintiff.
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 31 of 35
35. Though plaintiff had approached the Hon’ble High Court
of Delhi by filing the Writ petition No. 2091/2019 challenging
the cancellation order dated 06.02.2019 and for restraining the
defendant from awarding the tender of the parking site in
question to other party/bidder. It is an admitted fact that the writ
petition was disposed of being infructuous on the ground that the
contract was awarded to M/s M S Contractor for running the site
in question, in the said order Hon’ble High Court of Delhi issued
directions to the defendant to afford a personal hearing before
passing the speaking order. Admittedly, personal hearing and an
opportunity to file a proper reply to the show cause notice was
given to the plaintiff and thereafter, speaking order dated
30.05.2019 was passed by the defendant by holding that plaintiff
had deliberately stopped the payment of monthly license fees to
the defendant but continued collecting the parking charges from
the commuters from the date of handing over the possession of
the site i.e. 02.11.2018 upto the date of cancellation of contract
i.e. 06.02.2019 and also hold that the decision of forfeiture of
security deposit was as per terms and conditions of NIT.
36. Speaking order dated 30.05.2019 and the aforementioned
demand notice dated 25.09.2019 alongwith cancellation of
contract dated 06.02.2019 has been challenged in the present suit
for declaring these orders as null and void. As a consequence
plaintiff has prayed for a decree in favour of plaintiff and against
the defendant directing the defendant to refund the entire security
amount to the tune of Rs. 45 lakhs alongwith interest.
In view of the provisions of clause 10 (A) of NIT;
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 32 of 35
10. (A) Termination of the contract:
a) SDMC shall also have the right to terminate this Agreement by giving
thirty (30) days prior written notice to the Contractor without assigning any
reason to the Contractor.
b) In the event, the land of the Parking Lot is required or taken from SDMC
by
any Government Authority under any Applicable Laws, then in that case, the
said Agreement shall automatically stand terminated and Contractor have no
right to claim any damages, cost or expenses etc. from SDMC in any manner.
& Clause 13 of this document which deals with Non
Payment of License Fee;
Clause 13 deals with Non-payment of License Fee:
If the payment is not made in the manner stipulated abové i.e. if payment of
MLF of the succeeding month is not made by the last day of the preceding
month, the parking contractor shall be liable to deposit MLF with 24% per
annum interest within first 15 days of the succeeding month, failing which
the contract shall be deemed to have been terminated and security
deposit/performance guarantee forfeited, without any notice.
However, the Commissioner, SDMC or any other officer authorized by him,
in this behalf, may on consideration of a representation of the contractor
restore the parking site, subject to deposition of a restoration fees of 10% of
the annual value of contract along with outstanding license fee and interest,
penalty etc., for the intervening period & provided that the request for
restoration (of contract) is made within 10 days of the termination of
contract by the contractor.
The decision of the Commissioner or any other officer authorized by him,
after termination of the contract and to charge restoration fee or any other
amount as may be prescribed for the purpose, shall be final and binding
upon all. Any dues in this regard will be recoverable as arrears of MLF, if
any.
Furthermore, in terms of clause 16 of the aforesaid
document;
16 Security deposit/performance guarantee.
Payment of Security Deposit/ Performance Guarantee is to be made in the
manner prescribed in Anncure-9 before the parking site is handed over to
successful highest bidder. The security deposit will not be adjusted against
M.L.F of the current ‘site/contract’ but the same will be either adjusted against
the dues liability of other sites of the same parking contractor, with SDMC or
will be refunded after successful completion of contract period, without any
interest upon it however, subject to deductions/ forfeiture which may be
applicable on account of non performance, as the case may be. The decision
of the competent authority, in this regard shall be final and binding upon all.
And also in the light of clause 37 of the aforesaid
document;
Recovery of dues including MLF
In case of parking contractor fails to deposit his dues as per the conditions of
the contract including the MLF or the advance cheques presented by him are
not honoured by the issuing bank due to whatever reason, action under the
relevant clause of the contract agreement shall be taken against him.
Apart from any such action, the contractor shall be liable for initiation of the
criminal proceedings under relevant clause of Cr. PC/IPC any other remedies
available with the corporation under the law of the land. The charges payable
by the contractor are also liable to be recovered as revenue due to SDMC and
recovery proceeding under relevant provision (s) of DMC Act shall be taken
against defaulting contractor.
And furthermore, Clause 3;
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 33 of 35
3 Clause No 11, 12, Annexure 5
Monthly License Fee (MLF) First MLF to be deposited in advance, along
with Security Deposit/Performance Guarantee. (To be deposited by H-1
bidder at the time or acceptance of offer letter issued by RP Cell) MLF for the
succeeding month shall be payable on or before last day of the preceding
month.
Equivalent to bid amount Le. MLF accepted by SDMC.
Monthly License Fees has to be deposited in the shape of Demand
Draft/Bankers Cheque/Pay order or through RTGS/ECS in the SDMC A/c.
The preferred bidder shall be required to deposit 60 post dated cheques
against the Monthly License Fees payable by him.
If the H-1 bidder does not complete the formalities within 7 working days of
issue of offer letter, they will be liable to pay MLF immediately from the 8 th
working day.
And finally, the content of the letter written by plaintiff to
the defendant and duly admitted by the plaintiff;
The undersigned was allotted a parking site in pursuance of NIT NO. 542
28.08.2018, in Okhla Phase-1, being H-1 bidder in the NIT and the said
parking site was handed over to me on 02.11.2018 @ MLF 15,00,058 for a
period of three years.( Extendable further two years).
Accordingly The undersigned had deposited three month security amounting
Rs. 45, 00000/- and one month advance MLF amounting Rs. 15, 0000/- for
the period 01.11.2018 to 30.11.2018.
The undersigned had also given cheque for advance payment of two months
MLF but the undersigned was compelled to request the bank for stop
payment, as the deptt. despite request dated 28.12.2018, failed to address the
issues raised by the undersigned, as the undersigned was unable to run the
paring smoothly. The undersigned is continuously meeting the concerned
officials in this regard, however, the deptt. Instead of addressing the issues
raised by the undersigned, chose to pass cancelation order dated 06.02.2019,
without affording an opportunity of personal hearing.
It is further submitted that the undersigned is ready to undertake to abide by
the terms and conditions of the NIT and also ready to make the balance
payment towards MLF for the month of December and January.
In view of the above facts and submissions, it is, therefore, requested to
withdraw the cancelation orders dated 06.02.2019 and allow the undersigned
to run the parking site.
37. I am of the considered opinion that the show cause notice
issued by the defendant to the plaintiff was as per the terms
mutually agreed upon by the parties and speaking order dated
30.05.2019 has been passed by the defendant on the basis of facts
of the case while appreciating the terms and conditions of the
contract. The cancellation order dated 06.02.2019 is also on the
basis of the non compliance of contract by the plaintiff.
Accordingly, I am of the considered view that there exist no
cause of action in favour of plaintiff in the light of writ petition
No. 2091/2019 decided by our own Hon’ble High Court of Delhi
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 34 of 35
as the cause of action has become infructuous since the contract
has already been awarded to M/s M.S Contractor for running the
parking site in question and in the eventuality order dated
25.02.2019, 30.05.2019 and 06.02.2019 are passed by the
defendant on the basis of mutually agreed terms and conditions
by plaintiff and the defendant. Resultantly the issue no.2 to 6 are
decided in favour of the defendant and against the plaintiff.
Issue No. 7: Whether the plaintiff is entitled to a decree in
favour of plaintiff and against the defendant for refund of the
entire security amount to the tune of Rs. 45,00,000/-? OPP Issue
No.8: Whether the plaintiff is entitled for interest on the decreetal
amount, if yes, than at what rate and for which period? OPP and
Issue No.9: Whether the plaintiff is also entitled to the cost of the
suit? OPP
38. In the light of the findings on issue no. 1 to 6, these issues
are also decided against the plaintiff and in favour of defendant.
Resultantly, the suit of the plaintiff is hereby dismissed. No order
as to cost.
39. File be consigned to Record Room after due compliance.
Digitally signed
by NEELAM
SINGH
NEELAM Date:
Announced & dictated SINGH 2025.01.15
16:37:36
in the open Court on +0530
this 15th day of January, 2025 (NEELAM SINGH)
District Judge
(Commercial Court-02)
South-East, Saket Courts, ND
15.01.2025
CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 35 of 35
CS (COMM)-503/19
M/s Manoj Mobile World Vs. South Delhi Municipal
Corporation.
15.01.2025
Present: Sh. M L Chaudhary, Ld. Counsel for plaintiff.
Ms. Promila Kapoor, Ld. Counsel for defendant.
Vide separate judgment announced in the open
court, the suit of the plaintiff is dismissed.
File be consigned to record room after due
Digitally signed
NEELAM by NEELAM
compliance. SINGH
SINGH
Date: 2025.01.15
16:37:48 +0530
(NEELAM SINGH)
District Judge
(Commercial Court-02)
South-East, Saket Courts, ND
15.01.2025 jm
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CS (COMM)-503/19 M/s Manoj Mobile World Vs. South Delhi Municipal Corporation. Page 37 of 35