2013 (12) TMI 1748 - SC - Indian Laws

Supreme Court upholds decision to terminate licenses for port development; acknowledges procedural fairness concerns.

Yazdani International P. Ltd. Versus Auroglobal Comtrade P. Ltd. & Ors.

The SC dismissed all appeals, upholding the Board's decision to terminate licenses for developing modern port facilities. The initial plot allotments were ... - Issues Involved:1. Legality of the initial allotments of plots.2. Right of renewal of the licenses.3. Justification of the Board's decision to terminate the licenses.4. Procedural fairness and natural justice.Summary:1. Legality of the Initial Allotments:The Supreme Court examined whether the initial allotments of plots to the appellants were consistent with the principles laid down in the 2G case. It was found that most of the appellants were allotted plots either through an auction or tender process, which aligns with the law. Allotments made on an application basis prior to 2005 were also deemed valid due to the lack of competition at that time.2. Right of Renewal of the Licenses:The Court held that none of the appellants had an indefeasible right of renewal of their licenses. The licenses were permissive and did not create any interest in the property. The Board's decision not to renew the licenses was found to be consistent with the policy guidelines of 2010, which restricted the number of renewals to two.3. Justification of the Board's Decision to Terminate the Licenses:The Board's decision to terminate the licenses was justified on the grounds that the land was needed for developing modern operational facilities at the port. This decision was neither arbitrary nor irrational and served a larger public interest. The Court noted that the Board's decision was consistent with its statutory obligations and policy guidelines.4. Procedural Fairness and Natural Justice:The Court acknowledged that the High Court's order was made in breach of the principles of natural justice as the appellants were not parties to the proceedings. However, it decided not to set aside the order on this ground alone, as doing so would lead to protracted litigation and delay the Board's developmental projects. The appellants were given an opportunity to present their case before the Supreme Court, which found no substantive defense against the termination of their licenses.Separate Judgment for Auroglobal:Auroglobal's appeal was dismissed on similar grounds. The Court rejected the argument that the tender conditions were violative of Articles 14 and 19 of the Constitution, noting that Auroglobal had accepted the terms with full knowledge. The claim of discrimination was also dismissed, as the market conditions had changed since the earlier allotments.Conclusion:The Supreme Court dismissed all the appeals, upholding the Board's decision to terminate the licenses for the purpose of developing modern facilities at the port. The decision was found to be in the larger public interest and consistent with the statutory and policy guidelines.