2018 (5) TMI 2121 - SC - Indian Laws

Supreme Court Awards Compensation for Arbitrary Actions

The Supreme Court quashed the rejection letters and awarded compensation to the petitioners for the loss suffered due to the Respondent's arbitrary and ... Rejection of application of the Petitioners for registration and allocation of quota for the Hajj 2016 - rejection on the ground that they have not complied with certain clauses of the policy for the Private Tour Operators (PTOs) - HELD THAT:- The passage of time has made certain reliefs infructuous. The time period for conducting Hajj tours for 2016 as well as 2017 is over. Thus, even the alternative relief prayed for 2017 has become infructuous - The Petitioners cannot be left remediless. The mindless action of the Respondents in rejecting the eligibility of the Petitioners for the year 2016 on the very grounds on which they were exempted necessitates that the Petitioners should be entitled to damages in public law so that they are compensated, at least, to some extent for not having been able to carry on with their business on account of illegal action of the Respondents. The principles of damages in public law have to, however, satisfy certain tests. In NILABATI BEHERA @ LALITA BEHERA VERSUS STATE OF ORISSA [1993 (3) TMI 355 - SUPREME COURT], it was observed that public law proceedings serve a different purpose than private law proceedings. In the facts of the present case, the arbitrariness and illegality of the action of the authority is writ large. The Petitioners have been deprived of their right to secure the quota on a patently wrongful order passed for reasons, which did not apply to them and for conditions, which had been specifically exempted. What could be a greater arbitrariness and illegality? Where there is such patent arbitrariness and illegality, there is consequent violation of the principles enshrined Under Article 14 of the Constitution of India. The facts of the present case are, thus, undoubtedly giving rise to the satisfaction of parameters as a fit case for grant of compensation. The amount for each of the Petitioners be remitted by the Respondents within two months from the date of this order failing which the amount would carry interest @ 15 per cent per annum apart from any other remedy available to the Petitioners - Petition allowed. Issues Involved:1. Disqualification of Private Tour Operators (PTOs) for Hajj 2016 registration.2. Compliance with the PTO policy clauses.3. Validity of rejection letters issued to PTOs.4. Relief and compensation for the disqualified PTOs.Issue-wise Detailed Analysis:1. Disqualification of Private Tour Operators (PTOs) for Hajj 2016 registration:The main issue revolves around the disqualification of PTOs from registration and allocation of quota for Hajj 2016. The petitioners challenged the identical communications dated 27.07.2016 issued by the Respondent, which rejected their applications on the grounds of non-compliance with certain clauses of the PTO policy. The policy, as approved by the Supreme Court in Union of India v. Rafique Shaikh Bhikan and Al Ismail Haj Tour v. Union of India, was to remain valid for five years (2013-2017) and was not to be questioned in any court or authority.2. Compliance with the PTO policy clauses:The PTO policy required operators to facilitate a minimum of 150 pilgrims, with allocations done through a draw of lots if the number of qualified PTOs exceeded the quota. The petitioners were eligible for 2015 but were unsuccessful in the draw of lots. According to Clause 4(b) of the policy, they were entitled to 150 seats in the ensuing year (2016) without needing another draw if they remained qualified. However, the Ministry of External Affairs published new norms for 2016, which included exemptions for certain clauses (vii, x, xi, and xii) for PTOs who facilitated a minimum of 50 Umrah pilgrims annually for five years. Despite these exemptions, the petitioners faced rejection for non-compliance with the very clauses they were exempted from.3. Validity of rejection letters issued to PTOs:The rejection letters dated 26.07.2016 cited non-compliance with clauses vii, x, xi, and xii of Annexure A, despite the petitioners being exempted from these clauses. The court noted that the reasons for disqualification were wrongly communicated, and the Respondent's attempt to justify the rejection with different reasons was not acceptable. The court referred to the judgment in Mohinder Singh Gill v. Chief Election Commissioner, emphasizing that the validity of an order must be judged by the reasons mentioned in the order itself and cannot be supplemented by new reasons later.4. Relief and compensation for the disqualified PTOs:Given the passage of time, reliefs for conducting Hajj tours for 2016 and 2017 became infructuous. However, the court recognized the petitioners' right to compensation for the loss incurred due to the wrongful rejection. The principles of public law damages, as discussed in Nilabati Behera v. State of Orissa and Common Cause v. Union of India, were applied. The court emphasized that public law compensation aims to penalize the wrongdoer and assure citizens that their rights are protected under the legal system. The court found the Respondent's actions arbitrary and illegal, violating Article 14 of the Constitution. Consequently, the court awarded each petitioner Rs. 5 lakh as compensation, along with costs of Rs. 10,000 per petition. The Respondents were directed to remit the amount within two months, failing which interest at 15% per annum would apply.Conclusion:The Supreme Court quashed the rejection letters and awarded compensation to the petitioners for the loss suffered due to the Respondent's arbitrary and illegal actions. The judgment underscores the importance of adhering to established policies and the principles of public law in protecting citizens' rights.