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2011 (3) TMI 1713
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....i Shekhar. DIPAK MISRA, CJ Invoking the inherent jurisdiction of this Court under Article 226 of the Constitution of India, the petitioners have prayed for declaring the circulars AIC No: 7/2007 dated 28.9.2007, AIC No: 15/2008 dated 31.12.2008, AIC No: 6/2009 dated 30.6.2009, AIC No:13/2009 dated 31.12.2009, AIC No:3/2010 dated 2.6.2010 and the Regulations, namely, Airports Authority of India (General Management, Entry for Ground Handling Services) Regulations, 2007 (for short „2007 Regulations‟) as ultra vires the provisions of The Aircraft Act, 1934 (for short „the 1934 Act‟), The Aircraft Rules, 1937 (for short „the 1937 Rules‟) and The Airports Authority of India Act, 1994 (for short „the 1994 Act‟) and also ultra vires Articles 14 and 19(1)(g) of the Constitution of India and further to issue a writ of certiorari for quashment of the same. THE FACTUAL EXPOSITION AND THE STAND OF THE PETITIONERS 2. The petitioner No.1, Federation of Indian Airlines, is a society registered under the Societies Registration Act, 1860 comprising all the airline carriers which include the other writ petitioners. It is involved in promoting and ....
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....tions in case of failure to meet the agreed standards of service. 5. It is the experience of the petitioners that undertaking ground handling services themselves have enabled them to maintain the quality, cost and efficiency, level of performance and also helped in providing comfort and satisfaction to the passengers. The decision to undertake the ground handling services, which includes ramp handling and traffic handling, by themselves or to outsource is a business decision intrinsic to their business model and the airlines have the liberty to do so. The ramp handling includes cabin services like cleaning the plane, replenishing the supplies and consumables, etc. and traffic handling services include guiding the aircraft into and out of the parking position, refilling of fresh water tanks, air conditioning, luggage handling by belt loaders and baggage carts, passenger stairs (used instead of aerobridges or air stairs), wheel chair lifts, providing check-in counter services, gate arrival and departure services and airline lounges, etc. In this regard, reference has been made to the circular AIC No:3/2010 dated 2.6.2010 issued by the Director General of Civil Aviation laying down t....
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....2.6.2010 prevents / prohibits the airlines to provide ground handling services where there is no passenger interface. It is contended that the said circular could not have been issued by the said authority in the absence of an amendment of the ground handling Regulations 2007 as there is a complete dichotomy between the circular and the 2007 Regulations in the field. 10. The impugned circulars and Regulations have been assailed on the ground that the said circulars / Regulations run counter to Rule 92 of the 1937 Rules. It is contended that the DGCA has no authority to issue the impugned circulars and that the said circulars have been issued in utter disregard of the provisions of the 1934 Act, the 1994 Act and the Rules and Regulations made thereunder. It is further contended that the circulars have been issued without any application of mind, as an incurable dichotomy exists between the Regulations and the circulars. It is urged that the circulars are absolutely arbitrary, unreasonable, discriminatory and, hence, offend Article 14 of the Constitution of India; that the circulars / regulations violate the individual airlines‟ and their shareholders‟ fundamental right ....
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.... and would further put the reputation and goodwill of the airlines in jeopardy since such a service is an insegregable facet of running of the business. 13. It is contended that the circulars and Regulations have made a maladroit effort to overturn the level playing field that is required to be maintained between the National Aviation Company Ltd. and the private airlines and such an activity is contrary to any commercial policy. It is contended that in the international field, in many an airport in United States of America, United Kingdom and Australia, the airline operators are permitted to provide self-ground handling service in both ramp and terminal side operations but the same has been denied to the private airline operators as per the impugned circulars in the garb of security though it is basically incorrect. It is put forth that the circulars fundamentally transgress the basic facet of Rule 92 of the 1937 Rules as it totally demolishes the concept of competitive environment which is impermissible in the face of the said Rule. It is urged that as a result of the issuance of the notifications, the airlines would be compelled to avail of the services either from the National....
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....ctive handling of passengers and their baggage at the airport and the same cannot be and should not be handed over to a third party. It is asserted that if any loss or damage is caused to the luggage, the individual airline operators will still be held liable, whereas, by virtue of operation of the impugned circulars, they are not permitted to conduct the ground handling facility and such a situation would be contrary to the Carriage by Air Act, 1972 and various rules framed thereunder. It is contended that the private owners or the proposed independent ground handling operators would require to recruit the same staff who are now working on behalf of the airline operators and thereby the security scenario would not improve but there would only be a diversion of business interest. THE STANCE IN OPPOGUNATION BY THE RESPONDENT NOS. 1 AND 2 16. A counter affidavit has been filed by the respondent Nos.1 and 2 contending, inter alia, that prior to 2007, ground handling at Indian airports was done under the 2000 Regulations and all scheduled airlines were permitted to undertake ground handling services. At a later stage, ground handling of flights at the Indian airports became a matter....
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.....6.2009. During the said period, the respondent No.1 undertook an exercise to consult other stakeholders, including the airlines and airport operators, in order to understand and accordingly redress the concerns. The petitioner No.1 made another representation to the respondents on 5.6.2009 almost at the end of the extended time period fixed for the exit of non-entitled entities and after examination of the said representation, time was extended by another six months, i.e., upto 31.12.2009. In order to finalize the views on the issues raised by the airlines and the petitioner No.1, the answering respondents collected the details of the number of employees engaged in ground handling activities working directly on the rolls of the individual domestic airlines (excluding Air India) and outsourced / sub-contracted through the other agencies and the details of the equipment employed for ground handling by these airlines at all the six major airports. The manpower employed by the various airlines in the six metropolitan airports has been brought on record as Annexure R-1/5. It is put forth that the total number of 15,954 persons were employed by the five domestic airlines excluding Air I....
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....un counter to any Act or Rules and is not arbitrary. It is contended that the ground handling policy has been in force since the year 2007 but not given effect to because of the representations submitted by the petitioners from time to time. It is put forth that except the domestic carriers, most of the other airlines are already carrying out their ground handling operations through the designated ground handling agencies as is evident from the information available in Annexure R-1/1. The ground handling services are an important element of the service standards to be complied by the airport operators as laid down in Schedule 3 of the OMDA signed by the JVCs at Delhi and Mumbai airports (Annexure R-1/2) and the airport operators are expected to enter into agreements with the selected ground handling agencies in order to ensure the prescribed services standards. The airlines would still have the right of choice from the selected ground handling concessionaries as the said circular and regulations allow for a minimum of two ground handling agencies in addition to the national carrier (Air India). That apart, the domestic airline operators are still permitted to do self-handling at th....
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.... NO.3 20. A return has been filed by the respondent No.3, namely, AAI stating, inter alia, that the respondent has selected certain bidders subject to obtaining of security clearance from BCAS, Department of Central Government. It is put forth that licence for northern region has been granted to the consortium comprising M/s. Thai Airport Ground Services Bangkok, Thailand, M/s. Star Consortium Aviation Services Pvt. Ltd., Kolkata and M/s. Skyline Mercantile Pvt. Ltd., Kolkata. The lead member is M/s Thai Airport Ground Services, Bangkok. It is also averred that the licence for western region has been granted to the consortium comprising M/s National Aviation Services, WLL Kuwait, M/s National Aviation Services India Pvt. Ltd., Mumbai and M/s DJ Aviation Services Pvt. Ltd., Mumbai. The lead member is M/s National Aviation Services, WLL Kuwait. It is put forth that the licence for southern region has been granted to the consortium between M/s Bhadra International India Ltd. and M/s NOVIA International Consulting Aps Denmark. The lead member is M/s NOVIA International Consulting Aps. Denmark. It is also put forth that the licence for Chennai and Kolkata airports has been granted to ....
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....ndling services are considered to be an extremely specialized state of the art services undertaken at airports which are carried on by trained manpower with requisite expertise to operate the equipments. Various examples have been given about the position at other international airports. A stand has also been taken that the writ petition deserves to be thrown overboard on the ground of delay and laches inasmuch as the 2007 Regulations is challenged in the year 2010 and that too, after making series of representations to abide by the same. Immense emphasis has been laid on the decision taken by BCAS under Ministry of Civil Aviation to highlight that, on the basis of security, the decision has been taken and, therefore, the spacious plea that security has been used as an excuse to safeguard the commercial interest of the private respondents is absolutely erroneous. A similar stand has been taken in the Bombay High Court by Gulf Air Employees Association and others against the Government of India and others challenging the circular dated 28.9.2007 to the extent that restricting ground handling services by excluding self-handling is illegal but the said challenge did not find favour wi....
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....Chennai and Kolkata airports and, thus, an incurable anomaly has been brought into existence. Reliance has been placed on the BCAS circulars to highlight that the same permits the airline operators to undertake ground handling activities even through a ground handling agency. But the DGCA circulars seek to prevent the airline operators from undertaking ground handling activities themselves. 25. It is also urged that the circular dated 2.6.2010 enables the cargo airlines to do self-ground handling activities while the passenger airlines are not permitted to carry out the same which tantamounts to discrimination. The contradictions in the circulars issued by the various authorities have been pointed out. Emphasis has been laid on how security is not the main reason but a subterfuge inasmuch as there is a complete contradiction between the security requirements and the ground handling circulars / regulations. The stance that the circulars / regulations have been issued to streamline the ground handling operations is far from being true and the same really requires to be keenly studied and deeply scrutinized to avoid any kind of anomaly. 26. It is set forth that the petitioners, as o....
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....s have been given which we think it apposite to reproduce: "(i) No ground handling agency shall be allowed to work at the airport in future by the Airport Operator, Aircraft Operator or any other agency which has legitimate functions at the airport, unless prior security clearance is obtained from the BCAS. (ii) As per the Ground Handling Regulations 2000 dated 17.1.2000, the AAI/Airport Operator may issue a license only after security clearance from the BCAS to such ground handling agencies on prescribed terms and conditions and eligibility criteria for ground handling agencies and the number of such agencies to be appointed at each airport shall be determined keeping in view the safety, security, demand, available infrastructure, land and other relevant considerations to be laid down by the AAI in accordance with the Section 5 of the AAI Ground Handling Regulations (2000). (iii) Aircraft operator shall enter into contract with the ground handling agencies only after prior security clearance to these entities from the BCAS and approval from the AAI/Airport Operator. (iv) In case AAI/Airport Operator or Aircraft Operator intend to appoint a new ground handling agency, the de....
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....cy licensed by the Airports Authority of India. 1.3 The Airports Authority of India (General Management, Entry for Ground Handling Services) Regulations, 2000, have been made under Section 42 of the Airports Authority of India Act 1994 and thus are applicable to the airports managed by the Airports Authority of India. With the restructuring of certain airports and development of a few Greenfield airports in the private sector, it has become imperative for the Central Government to lay down the eligibility criteria for various agencies to undertake ground handling services at non-AAI airports. The number of such agencies to be permitted at each airport is also to be determined by the Government having regard to all the relevant factors such as demand for such services, available infrastructure and competitive environment, without compromising the safety and security aspects. 1.4 Rule 92 of the Aircraft Rules, 1937 provides that the licensed public aerodromes shall, while providing ground handling services themselves ensure a competitive environment and allow the ground handling service providers permitted by the Central Government to provide ground handling services at such aero....
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....3. The said circular stipulated that the same was to come into force w.e.f.1.1.2009. In Annexure A appended to the said circular, ramp handling, aircraft servicing, aircraft cleaning, loading and unloading, cargo handling services and security are mentioned. In Annexure B, traffic handling is the genus and it includes as its species terminal services, flight operations, surface transport and security. 34. By Circular No. AIC Sl.No.15/2008 issued by the Joint Director General of Civil Aviation on 31.12.2008, the grant of permission for providing ground handling services at airports other than those belonging to the AAI has been amended. The amended clause provides that the policy shall come into force with immediate effect. The airline operators or any other ground handling service providers not covered by the said policy shall not be allowed to undertake self-handling or third party handling with effect from 01 July, 2009 or till further orders, whichever is earlier. 35. Circulars to the similar effect being Circular No. AIC Sl. No. 06/2009 and Circular No. AIC Sl. No. 13/2009 were issued on 30.6.2009 and 31.12.2009 restricting self-ground handling or third party handling by airl....
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....ed agency under Regulation 3 authorised by it for handling its own aircrafts; (b) any other Operator or Agency who or which has been specially permitted in writing by the Authority to undertake ground handling activities through their bonafide whole time employees; (c) the bonafide whole time employees of National Carriers or any of the designated agencies under Regulation 3 authorised by them; (d) the bonafide whole time employees of Airports Authority of India or a designated agency authorised by it. 5. The Board of AAI will lay down terms and conditions (including financial consideration), eligibility criteria for ground handling agency (both financial and technical) and number of such agencies to be appointed at each airport keeping in view the safety, security, demand, available infrastructure, land and other relevant consideration." 39. On 18.10.2007, in exercise of power conferred under Section 42 of the 1994 Act, a set of Regulations, namely, Airports Authority of India (General Management, Entry for Ground Handling Services) Regulations 2007 was issued in supersession of the 2000 Regulations. Regulation 1(3) provides that the Regulations shall apply to all airpor....
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....hat the state of the art equipment are used and „best practices‟ are followed. (4) Airlines or entities presently involved in ground handling which are not governed by these regulations shall not be permitted to undertake self handling or third party handling with effect from the first day of January, 2009." 41. Schedule I to the Regulations deals with Ramp Handling, Aircraft Servicing, Aircraft Cleaning, Loading / Unloading, Cargo Handling Services and Security. Schedule II deals with Traffic Handling whereunder Terminal Services, Flight Operations, Surface Transport and Representational Services find mention. SUBMISSIONS: 42. Mr. Mukul Rohtagi and Mr. N.K. Kaul, learned senior counsel appearing for the petitioners, have advanced the following proponements: (a) The 2007 circular, which is purported to have been issued under Section 5A of the 1934 Act, travels beyond the provision and clearly contravenes the statutory mandate as Section 5A is made applicable to a limited sphere but the authority concerned has travelled beyond the said sphere / arena as a consequence of which it is sensitively susceptible. A circular for direction can be issued in respect of any ....
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..... The introduction of the 2007 Regulations is an anathema to the entire concept of privatization of airline industry and the exclusion of the petitioners to handle the majority of air traffic in India is arbitrary and unreasonable. (f) The AAI Regulations 2000 allowed all the airlines to conduct self-ground handling facilities including outsourcing which was permitted by the AAI. The 2007 Regulations run counter and are in conflict with the statutory requirement contained in Rule 134 read with Schedule 11 of the 1937 Rules. That apart, the conditions of the licence are statutory in nature and any intervention in the same would violate the statutory framework. (g) The Regulations and the circular project a picture of contradiction and disharmony inasmuch as the Regulations cover four airports whereas the circular covers six airports. That apart, the airports at Kolkata and Chennai, which are not managed by private airport owners, could not have been covered and same goes to show that there has been a total non-application of mind. The circular, as a policy, smacks of arbitrariness and unreasonableness as it creates a dent in the integral part of airline operation which includes gr....
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....lities would be handled by the airport operator itself or its joint venture partner; subsidiary companies of the national carrier, i.e., Air India / Indian Airlines or their joint venture or third party handling provided that they are selected through competitive bidding and on revenue sharing basis and subject to security clearance by the Government of India and the said circular has been issued under Rule 133A of the 1937 Rules and there is no conflict / discord between the rule and the circular. (iv) The proponement that a monopoly has been created in favour of all the private operators is sans substratum since Regulation 3 of the 2007 Regulations clearly stipulates that the ground handling service at airport can be carried out by AAI or it joint venture company or subsidiary companies of the national carrier, i.e., National Aviation Company India Ltd. or its joint ventures specialized in ground handling services. That apart, the Regulation also permits any other ground handling service provider selected through competitive bidding on revenue sharing basis subject to security clearance by the Central Government and observance of performance standards. On a careful reading of th....
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.... of the 1994 Act which has to be interpreted on a broad canvass. 44. Dr.A.M. Singhvi, learned senior counsel appearing for the respondent Nos.5 and 7, has advanced the following submissions: (i) The interpretation placed by the learned counsel for the petitioners on Section 5A of the Act is totally unacceptable as an effort has been made to read the provision in a fragmented manner which is not permissible. The said provision has to be contextually and conceptually interpreted regard being had to the four facets, namely, textual language power, boundaries of the power, targets which are required to be addressed to and the proper exercise of power. (ii) The proponement by the petitioners to read „in any case‟ with the satisfaction of the security of India and with the clauses that have been enumerated earlier is a composite manner is impermissible. The term „in any case‟ has to be understood in a broader expanse and it can cover any matter where the security of India or safety of aircraft operator is a necessity and is not required to have nexus with the clauses (aa), (b), (c), (e), (f), (g), (ga), (gb), (gc), (h), (i), (m) and (qq) of sub-section (2) of S....
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....san S. & Anr., (2002) 5 SCC 285, Madhya Pradesh Ration Vikreta Sangh Society & Ors. v. State of Madhya Pradesh, (1981) 4 SCC 535, Sarkari Sasta Anaj Vikreta Sangh Tehsil Bemitra & Ors. v. State of Madhya Pradesh, (1981) 4 SCC 471, State of Orissa & Anr. v. Radheyshyam Meher & Ors., (1995) 1 SCC 652, Hindustan Zinc Ltd. v. Andhra Pradesh State Electricity Board & Ors., (1991) 3 SCC 299, Association of Industrial Electricity Users v. State of A.P. & Ors., (2002) 3 SCC 711, M/s Bajaj Hindustan Ltd. v Sir Shadi Lal Enterprises Ltd. & Anr., (2011) 1 SCC 640 and an unreported decision in Dilip Ranadive & Anr. v. Union of India & Ors., W.P. No. 516/2008 by the High Court of Bombay. 46. Mr. Sudhir Chandra, learned senior counsel appearing for the respondent Nos. 4 and 6, has submitted thus: (i) The circulars issued by the DGCA under Section 5A of the 1934 Act has a nexus with Section 2(gc) and, therefore, it cannot be said to be beyond the provisions mentioned in reference to Section 2 in Section 5A. (ii) Rule 92 of the 1937 Rules does not create a right. Quite apart from that, to appreciate the validity of the circulars, Sections 2(b), 2(d), 2(nn) and 12A of the 1994 Act have to be kep....
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....itioners can enter into the fray by satisfying the conditions envisaged in the Regulations and the circulars but they intend to maintain their monopoly and carry on their outsourcing having scant regard for the security of the country. It is put forth by him that Section 5A of the 1934 Act, which has been amended, is the repository of power which authorizes the competent authority to issue circulars and the circulars being in consonance with the provision cannot be declared ultra vires. He has placed reliance on the decision rendered in Khoday Distilleries Ltd. v. State of Karnataka, (1996) 10 SCC 304. 49. Mr.P.K.Ray, learned counsel appearing for the respondent No.12, while supporting the submissions made by the learned counsel for the other co-respondents, contended that the petitioners do not have unfettered right to carry on the ground handling service and if the data of employment is scrutinized, it is vivid that they really do not avail the manpower by direct employment but outsource them to a large extent and, hence, the submission that their rights are infringed is bereft of any substance. THE CORE ISSUES 50. Though we have enumerated the submissions in detail to apprec....
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....framed and that apart, when we have heard the parties at length, we are not inclined to throw the writ petition over board on the ground of delay and laches. Accordingly, the aforesaid submission, being sans substance, stands repelled. 52. The next aspect that arises for consideration is whether the circulars could have been issued by the DGCA in exercise of power under Section 5A of the 1934 Act and also in transgression of Rule 92 of the 1937 Rules. That apart, it is to be tested whether the circulars, as policy decisions, are to be regarded as arbitrary and unreasonable. Section 5A was brought in the statute book and was substituted by Act 44 of 2007. The said provision, being differently interpreted by both the sides, is required to be reproduced in toto: "5A. Power to issue directions. - (1) The Director-General of Civil Aviation or any other officer specially empowered in this behalf by the Central Government may, from time to time, by order, issue directions, consistent with the provisions of this Act and the rules made thereunder, with respect to any of the matters specified in [clauses (aa), (b), (c), (e), (f), (g), (ga), (gb), (gc)], (h), (i), (m) and (qq) of sub-sectio....
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....tion of flight by aircraft over any specified area, either absolutely or at specified times, or subject to specified conditions and excpetions; X X X X (m) the measures to be taken and the equipment to be carried for the purpose of ensuring the safety of life; X X X X (qq) the prohibition of slaughtering and flaying of animals and of depositing rubbish, filth and other polluted and obnoxious matter within a radius of ten kilometers from the aerodrome reference point;" 54. It is submitted by the learned senior counsel for the petitioners that Section 5A of the 1934 Act has to be given a restricted interpretation and, in fact, the circulars had to be in accord with the sub-sections mentioned therein and further, the security aspect has to have nexus only with the postulates mandated in the aforesaid provisions and cannot travel beyond the said periphery. It is urged that mere compliance of the provisions alone would not suffice the security facet. In essentiality, it is propounded that both the aspects have to be read cumulatively and not in isolation. 55. The stipulations engrafted in Section 5A are to be contextually understood. The text and context have to go hand in ha....
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....SCC 349, while dealing with the concept of contextual interpretation, their Lordships have opined thus: "The rule of contextual interpretation requires that the court should examine every word of the statute in its context, while keeping in mind the Preamble of the statute, other provisions thereof, pari materia statutes, if any, and the mischief intended to be remedied. Context often provides a key to the meaning of the word and the sense it carries." 59. Keeping in view the aforesaid pronouncements in the field, we are required to see whether the authority concerned is empowered to issue directions for the purpose of giving effect to the provisions of Section 5(2) only when security aspect is inherently involved. For the aforesaid interpretation, the learned senior counsel for the petitioners would lay emphasis on the words "in any case" to convey that the said words really have the character of condition precedent. 60. In the case of Lalu Prasad Yadav (supra), the term "in any case" came for interpretation and in that background, their Lordships construed the said words to be of widest amplitude. The question that arose in the said case was with regard to the interpretation ....
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....rity of India or securing the safety of aircraft operation is involved. The same cannot be restricted or constricted to the provisions of Section 5(2) which find mention therein. In this regard, we may also fruitfully refer to Section 4A of the Act which reads as under: "4A. Safety oversight functions. - The Director-General of Civil Aviation or any other officer specially empowered in this behalf by the Central Government shall perform the safety oversight functions in respect of matters specified in this Act or the rules made thereunder." 63. We have referred to the said provision as the same is of immense importance regard being had to the security facet. In this context and backdrop, if Section 5A is understood only in the light of sub-section (2), it would not only be unpurposive but also fundamentally defeat the essential purpose. That is not the legislative intent. Quite apart from the above, the clauses which find mention in the provision should also not be narrowly constructed. Mr.Sudhir Chandra, learned counsel for the respondent Nos.4 and 6 has placed heavy reliance on clauses (b), (ga) and (gc) mainly on the words „regulations of aerodromes‟, „traffi....
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....ing ground handling service by itself, ensure a competitive environment by allowing the airline operator at the airport to engage, without any restriction, any of the ground handling service provider who is permitted by the Central Government to provide such services: Provided that such ground handling service provider shall be subject to the security clearance of the Central Government." 66. Relying on the aforesaid Rule 92, it is contended that an airline operator has an indefeasible right to provide the ground handling service itself or engage, without any restriction, any ground handling service provider to prevent unfair competitive environment. It is urged that by virtue of the circulars coming into force, the right to ground handling service by the airline operator is taken away and, therefore, the circulars run counter to Rule 92 despite Rule 92 being in the Rules. 67. The basic test is to determine whether a rule to have effect must have its source of power which is relatable to the rule making authority. Similarly, a notification must be in accord with the rules, as it cannot travel beyond it. In this context, we may refer with profit to the decision in General Offic....
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...., if appositely appreciated, refers to licensee which means the airport operators who can do the ground handling themselves. It further postulates that the airport operator has to ensure a competitive environment and the same can only be done by the airport operator and not by the airline operator. The said interpretation also gathers support if its date of introduction, i.e., 5.11.2004 is taken note of, for the simon pure reason that the rule was amended after the concept of privatization of the airport was introduced. 74. The submission of the petitioners is that an absolute right is inherent with the airline operator. The said argument is not acceptable as there is a distinction between an airport operator and an airline operator. In fact Rule 92 confers no right of self-handling on the airline operators like the petitioners. 75. The impugned circular, as is manifest, ensures a competitive environment. The said Rule also stipulates that such ground handling service provider shall be subject to security clearance of the Central Government. Hence, the emphasis is on competitive environment and security clearance. The airport operator itself or by its joint venture partner, the s....
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.... consider as to whether a particular policy is wise or a better public policy can be evolved. Such exercise must be left to the discretion of the executive and legislative authorities as the case may be. 80. In M.P. Oil Extraction and another v. State of M.P. and others (1997) 7 SCC 592, it has been held that in matters of policy decision, the scope of judicial review is limited and circumscribed. The Apex Court has further held thus: "41. After giving our careful consideration to the facts and circumstances of the case and to the submissions made by the learned counsel for the parties, it appears to us that the Industrial Policy of 1979 which was subsequently revised from time to time cannot be held to be arbitrary and based on no reason whatsoever but founded on mere ipsi dixit of the State Government of M.P. The executive authority of the State must be held to be within its competence to frame a policy for the administration of the State. Unless the policy framed is absolutely capricious and, not being informed by any reason whatsoever, can be clearly held to be arbitrary and founded on mere ipsi dixit of the executive functionaries thereby offending Article 14 of the Constitu....
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.... interest of certain trader, even to the extent of restricting the State's capacity to advance larger public goods. It can hardly be disputed that the consideration of availability of the medicines to the patients should be the uppermost consideration as compared to the right of a person to derive income and make profits for his sustenance by running a medical store for the reason that the medical stores are primarily meant for the patients and not the patients for the medical stores or those who run the same. The submission of the respondents that if a medical store is opened within the campus of the hospital, the same will jeopardise their interest adversely affecting their business and that they will not be able to sustain themselves could not be a valid ground to disallow the appellants to open a shop within the hospital campus. Undoubtedly, the opening of a medical store within the hospital campus will provide a great facility to the patients who may not be having any attendant of their own in the hospital for their assistance at odd hours in the event of an emergency to go out to purchase the medicines. There may be patients having an attendant who may not find it conveni....
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.... policy decisions of the executive unless the policy can be faulted on grounds of mala fide, unreasonableness, arbitrariness or unfairness, etc. 85. In State of U.P. and another v. Johri Mal, (2004) 4 SCC 714, while dealing with the limited scope of judicial review, the Apex Court has laid down the following guidelines - "The limited scope of judicial review, succinctly put, is: (i) Courts, while exercising the power of judicial review, do not sit in appeal over the decisions of administrative bodies. (ii) A petition for a judicial review would lie only on certain well-defined grounds. (iii) An order passed by an administrative authority exercising discretion vested in it, cannot be interfered in judicial review unless it is shown that exercise of discretion itself is perverse or illegal. (iv) A mere wrong decision without anything more is not enough to attract the power of judicial review; the supervisory jurisdiction conferred on a Court is limited to seeing that the Tribunal functions within the limits of its authority and that its decisions do not occasion miscarriage of justice. (v) The Courts cannot be called upon to undertake the government duties and functions. ....
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....can only interfere if the policy framed is absolutely capricious, not informed by reasons whatsoever, totally arbitrary and is found ipse dixit offending the basic requirement of Article 14 of the Constitution of India. 91. As the present policy lays emphasis on security to appreciate the steps taken for security, we think it apt to reproduce the order No.03/2009 dated 21.8.2009 issued by the Bureau of Civil Aviation Security in exercise of powers conferred by Section 5A of the Aircraft Act, 1934 read with para 4 of the DGCA Circular No.9/1/2002-IR dated 28.9.2007 and Regulations 6 and 7 of the 2007 Regulations. By virtue of the said order, the Commissioner of Security (BCAS), for the purpose of securing the safety of aircraft operations has directed certain activities pertaining to aircraft operations to be treated as Aircraft Operators Aviation Security Functions. They are: "i) Access control to the aircraft. ii) Aircraft security search / security check during normal as well as bomb threat situation. iii) Screening of registered / unaccompanied baggage, cargo, mail and company stores etc. iv) Surveillance of screened baggage till acceptance at check in counters. v) Sec....
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....nsibility for all security related functions shall be with the airlines concerned. For this purpose, a security coordinator shall be designated by the respective airlines at each airport from where they shall have operations. 8. This order supersedes all instruction (except BCAS Cir No.4/2007) on the subject and shall come into force with immediate effect. Violation of this order will attract legal action under Section 11A of the Aircraft Act, 1934." [Underlining is ours] 93. The contention of the learned counsel for the petitioners is that the security facet has been introduced as a subterfuge to curtail the commercial interests of the petitioners and gradually destroy their existence. Per contra, the submission of the learned Solicitor General is that strong steps have been taken to regulate, protect and oversee the security measures regard being had to the global phenomena and the security lapses that have taken place at the airports. The factum of security cannot be gone into by court of law and more so when specific aspects have been dwelled upon and delved into by the Bureau of Civil Aviation Security. The security of a country is paramount. It is in the interest of the n....
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....But as discussed above a person who bases his claim on the doctrine of legitimate expectation, in the first instance, must satisfy that there is a foundation and thus has locus standi to make such a claim. In considering the same several factors which give rise to such legitimate expectation must be present. The decision taken by the authority must be found to be arbitrary, unreasonable and not taken in public interest. If it is a question of policy, even by way of change of old policy, the courts cannot interfere with a decision…" 95. Learned counsel appearing for the petitioners have also submitted that when a change of policy takes place, it cannot totally brush aside the legitimate expectations of the persons who were the beneficiaries of the earlier policy. In this regard, we may fruitfully refer to Bannari Amman Sugars Ltd. v. Commercial Tax Officer & Ors., (2005) 1 SCC 625, while dealing with the concept of legitimate expectation and a change in policy, their Lordships referred to the decision in Union of India v. Hindustan Development Corporation, AIR 1994 SC 988 and eventually expressed the view thus: "While the discretion to change the policy in exercise of the ....
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....rative law, yet the same is subject to change of rule or a policy decision and the policy decision is required to be tested on Wednesbury principle. The present change of policy is neither unreasonable nor malafide to warrant interference by this Court in exercise of power of judicial reviw. 99. The next issue pertains to whether the circulars invite frown of Article 14 of the Constitution since there is no reasonable classification based on any intelligible differentia and there is no rational nexus between the objects sought to be achieved. To substantiate the said submission, it has been urged with immense vehemence by the learned counsel for the petitioners that the airport authorities have been put in different categories and have been deprived of self-ground handling service whereas others have been extended the benefit. Elaborating the same, it is urged that the circulars permit the joint venture company or the joint venture companies of National Aviation Company Ltd. and any other ground handling service provider selected through competitive bidding on revenue sharing basis but the petitioners have been deprived. On a perusal of the 2007 circular implementation of which ha....
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....ffending Article 14 of the Constitution, but taking into consideration the wider concept, their Lordships held as follows: "The wider concept of equality before the law and the equal protection of laws is that there shall be equality among equals. Even among equals there can be unequal treatment based on an intelligible differentia having a rational relation to the objects sought to be achieved. Consumers' cooperative societies form a distinct class by themselves. Benefits and concessions granted to them ultimately benefit persons of small means and promote social justice in accordance with the directive principles. There is an intelligible differentia between the retail dealers who are nothing but traders and consumers' cooperative societies. The position would have been different if there was a monopoly created in favour of the later. The scheme only envisages a rule of preference. The formulation of the scheme does not exclude the retail traders from making an application for appointment as agents." 100. In this regard, it would not be out of place to refer to the concept of classification as laid down in the locus classicus, i.e., Ram Krishna Dalmia and Ors. v. Shri ....
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....are trouble facing areas. Mr. Rohtagi and Mr. Kaul, learned senior counsel appearing for the petitioners would contend that a piquant situation has been ushered in since the interface at the airports would be carried on by the airline operators as a consequence of which the operations would face the wrath of the passengers whereas the other wings which would handle ground handling services would not face the same. This, according to them, creates a total dent in carrying out the business and, hence, it offends Article 19(1)(g) of the Constitution. Per contra, Mr.Gopal Subramanium, learned Solicitor General appearing on behalf of the Union of India submitted that the Article 19(1)(g) is not absolute and subject to Article 19(1)(6) of the Constitution the State can make any law imposing reasonable restrictions in the interests of general public. 103. In Madhya Pradesh Ration Vikreta Sangh Society (supra) while dealing with challenge to the scheme under Article 19(1)(g) the Apex court has opined thus: "10. The constitutionality of the impugned scheme is also challenged as abridging Article 19(1)(g) of the Constitution. The short answer to the challenge is that the scheme in no way i....
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....t be said to contain the quality of reasonableness and unless it strikes a proper balance between the freedom guaranteed in Article 19(1)(g) and the social control permitted by Clause (6) of Article 19, it must be held to be wanting in that quality." [Emphasis supplied] 105. In Municipal Corpn., Ahmedabad v. Jan Mohammed, AIR 1986 SC 1205, the Apex Court has held that in considering the validity of the impugned law imposing prohibition on the carrying on of a business or a profession, the Court must attempt an evaluation of its direct and immediate impact upon the fundamental rights of the citizens affected thereby and the larger public interest sought to be ensured in the light of the object sought to be achieved. 106. In Deepak Theatre v. State of Punjab, 1992 Supp (1) SCC 684, their Lordships ruled that the Article 19(1)(g) of the Constitution accords fundamental rights to carry on any profession, occupation, trade or business, but would be subject to reasonable restrictions on the exercise of the said right imposed by a law, in the interest of the general public. 107. In Om Prakash v. State of U.P., (2004) 3 SCC 402, the Apex Court articulated that the term "reasonable rest....
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....e earlier part of our decision while relating to why such a policy decision was warranted. There can be no iota of doubt that the national security is in the interest of general public and public order. It cannot be said that the petitioners had an indefeasible right to do the entire ground handling service solely because they were granted security clearance by the Central Government. One is required to apply the test of immediate and direct impact, level playing field which is subject to public interest, the nature of restriction regard being had to the concept of excessive postulates or stipulation of conditions. In the case at hand the ground handling service has been bifurcated. The sphere of operation that has been restricted pertains to the field of security. The authorities have taken the stand of larger public interest. The level playing field has to succumb to the same. It is to be kept in mind that the concept of reasonable restriction strikes a balance between an individual right to carry on his business or trade or profession and the larger public interests on the other. The right of the petitioners to carry out the function of airline operators has not been taken away.....
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....uld have any bearing on the lis. At this juncture, we may refer to the decision in Mr.Dilip Ranadive & Anr. (supra), wherein the High Court of Bombay has held thus: 27. Being so, the respondents are justified in contending that the grievance of the petitioners that the regulations issued on 18th September, 2007 is devoid of substance. The regulations specifically relates to the airports managed by the Airport Authority of India whereas the circular applies to all the airports other than belonging to the Airport Authority of India, and hence there is no question of one superseding the another and both are to be read harmoniously. In this regard, the stand of the respondent No. 1 which is also clear to the effect that the regulation does not supersede circular and that therefore the EOI cannot be said to be ultra vires. The same is the stand of the respondent No. 2 in their affidavit where it has been stated that the circular dated 28th September, 2007 is independent of the regulations of 2000 and, therefore, there is no question of supersession the circular by the Regulations. 111. We concur with the aforesaid view, for we perceive that in the 2007 Regulations, there is no mention....
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....nment of India and the Government of that country, or, where there is no such agreement, of a temporary authorization by the Government of India. (3) No air transport service, other than a scheduled air transport service or an air transport service, to which the provisions of sub-rule (1) or (2) apply, shall be operated except with the special permission of the Central Government and subject to such terms and conditions as it may think fit to impose in each case." 113. On a bare perusal of the said Rule, it is quite vivid that no one can operate any scheduled air transport from, to, in, or across India except with the permission of the Central Government, granted under and in accordance with and subject to the provisions contained in Schedule XI. It is also luculent that every operator operating any scheduled air transport service shall render service in accordance with the conditions specified in the order passed by the Central Government including any condition relating to their due compliance. Schedule XI deals with grant of permission to operate scheduled air transport services. Clause 5 provides that every application for grant of permit is to be made to the Director Gener....
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....e guidelines for minimum requirements for grant of permit to operate schedule passenger air transport services. The introduction to the same reads as follows: "1. INTRODUCTION Sub-rule 1 of Rule 134 of the Aircraft Rules, 1937 specifies that no person shall operate any scheduled air transport service from, to, in, or across India except with the permission of the Central Government, granted under and in accordance with and subject to the provisions of Schedule XI of the Aircraft Rules. This Civil Aviation Requirement contains the minimum airworthiness, operational and other general requirements for grant of permit for Scheduled air transport operations. This CAR is issued under provisions of Rule 133A of the Aircraft Rules, 1937. These requirements are complimentary to the requirements of ICAO Annex 6 Part I, as applicable to scheduled operations." 115. Rule 133A occurs in Part XIIA which deals with Regulatory Provisions. Rule 133 is the only Rule which occurs in the said part. It deals with directions by Director-General. Clause 3 of the Civil Aviation Requirements stipulates the eligibility requirements. Clause 3.2.6 reads as follows: "3.2.6 adequate ground handling facilitie....