- 1 - WA No.100549 of 2022 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 28TH DAY OF APRIL, 2025 PRESENT THE HON'BLE MR. JUSTICE S G PANDIT AND THE HON'BLE MR. JUSTICE C.M. POONACHA WRIT APPEAL NO.100549 OF 2022 (GM RES) BETWEEN: MR. HEMANTH M JOSHI AGE. 55 YEARS, OCC. BUSINESS, S/O SRI MOHANLAL JOSHI, R/O. GOMEZ BUILDING, VAKIL CHAWL, GADAG-582101. ...APPELLANT (BY SRI. VEERESH BUDIHAL, ADVOCATE) AND: 1 . UNION OF INDIA THROUGH THE MINISTRY OF RAILWAYS, REP. BY ITS GENERAL MANAGER, SOUTH WESTERN RAILWAYS, RAIL SOUDHA, GADAG ROAD, HUBBALLI-580020. 2 . THE GENERAL MANAGER SOUTH WESTERN RAILWAY, DIVISIONAL OFFICE, RAIL SOUDHA, GADAG ROAD, HUBBALLI-580020. 3 . THE CHIEF COMMERCIAL MANAGER SOUTH WESTERN RAILWAY, DIVISIONAL OFFICE, RAIL SOUDHA, GADAG ROAD, HUBBALLI-580020. 4 . THE SENIOR DIVISIONAL COMMERCIAL MANAGER SOUTH WESTERN RAILWAY, ASHPAK KASHIMSA MALAGALADINNI Digitally signed by ASHPAK KASHIMSA MALAGALADINNI Location: HIGH COURT OF KARNATAKA DHARWAD BENCH - 2 - WA No.100549 of 2022 DIVISIONAL OFFICE, RAIL SOUDHA, HUBBALLI-580020. 5 . THE MANAGING DIRECTOR IRCTC LIMITED, IRCTC CORPORATE OFFICE, #B 148, 11TH FLOOR, STATESMAN HOUSE, BARAKHAMBA ROAD, NEW DELHI-110001. 6 . THE REGIONAL MANAGER IRCTC LIMITED, NO.82, SHREE MARUTHI RAM KRISHNA ARCADE, DR. RAJKUMAR ROAD, RAJAJI NAGAR, BENGALURU-560010. 7 . THE MANAGER (CS)/SZ IRCTC LTD, ZONAL OFFICE, SOUTH ZONE, 6A, THE RAIN TREE PLACE, NO.9, MC NICHOLAS ROAD, CHETPET, CHENNAI-600031. 8 . THE DIRECTOR (TOURISM & CATERING) RAILWAY BOARD, #B 148, 11TH FLOOR, STATESMAN HOUSE, BARAKHAMBA ROAD, NEW DELHI-110001. …RESPONDENTS (BY SRI. M.C. HUKKERI, ADVOCATE FOR R1 TO R4 & R8; SRI. SADIQ GOODWALA, ADVOCATE FOR R5,R6,R7; SRI. M.B. KANAVI, ADVOCATE FOR R6) THIS WRIT APPEAL IS FILED U/S.4 OF KARNATAKA HIGH COURT ACT, 1961, PRAYING TO, SET ASIDE THE ORDER DATED 06.12.2022 PASSED BY THE LEARNED SINGLE JUDGE OF THIS HON’BLE COURT IN WRIT PETITION NOS.102294/2022 (GM-RES) AND FURTHER TO ALLOW THE SAID WRIT PETITION, AND ETC. - 3 - WA No.100549 of 2022 THIS WRIT APPEAL HAVING BEEN HEARD AND RESERVED ON 16.04.2025 AND COMING ON FOR PRONOUNCEMENT OF JUDGMENT THIS DAY, S.G. PANDIT, J., DELIVERED THE FOLLOWING: CORAM: THE HON'BLE MR. JUSTICE S G PANDIT AND THE HON'BLE MR. JUSTICE C.M. POONACHA CAV JUDGMENT (PER: THE HON'BLE MR. JUSTICE S G PANDIT) This appeal under Section 4 of the Karnataka High Court Act, 1961 is directed against the order dated 06.12.2022 in W.P.No.102294/2022 whereby appellant’s challenge to the bid notification dated 07.06.2022 inviting tenders and prayer to quash Commercial Circular No.22/2017 dated 15.03.2017 and also for a direction to renew the catering license of the petitioner is rejected. 2. Parties to the present appeal would be referred to as they stood before the learned Single Judge. The appellant was petitioner and respondents were respondents before the learned Single Judge. - 4 - WA No.100549 of 2022 3. Brief facts of the case are that, the petitioner was granted license to set up and run a major stall i.e., (fast food unit) in Gadag railway station by letter of indent dated 11.07.2009. On 21.07.2010, the respondent- Railways brought into effect the catering policy of 2010. In pursuance to the letter of allotment to run major food stall, agreement was entered into between the petitioner and respondents on 07.12.2011. In terms of the agreement, the tenure of major units was for a period of five years, making it clear that there will be no renewal for major units. The period of license of the petitioner expired in the year 2016. The respondent-railways issued tender notification dated 07.06.2022 inviting sealed e-tender for setting up of operation and management of fast food units at railway stations including Gadag railway station. Questioning the said tender notification with a prayer to quash the new policy published under the Circular No.22/2017 dated 15.03.2017 and also praying to renew the catering license, the petitioner was before the learned Single Judge in W.P.No.102294/2022. Learned Single Judge after hearing both the parties, under impugned - 5 - WA No.100549 of 2022 order rejected the petitioner’s writ petition. Questioning the said rejection, the present appeal is filed. 4. Heard learned counsel Sri.Veeresh Budihal for petitioner/appellant, learned counsel Sri.M.C.Hukkeri for respondent Nos.1 to 4 and 8, learned counsel Sri.Sadiq Goodwala for respondent Nos.5, 6 and 7 and learned counsel Sri.M.B.Kanavi for respondent No.6. Perused the entire writ appeal papers. 5. Learned counsel Sri.Veeresh Budihal for petitioner contends that learned Single Judge failed to appreciate the decision of the Hon’ble Apex Court in the case of SENIOR DIVISIONAL COMMERCIAL MANAGER, SOUTH CENTRAL RAILWAYS AND OTHERS VS. S.C.R. CATERERS, DRY FRUITS, FRUIT JUICE, STALLS WELFARE ASSOCIATION AND ANOTHER1. He submits that in the said decision the association of caterers had approached the High Court of Andhra Pradesh questioning non-renewal of their license and inviting sealed bids for allotment of food stalls. In the above case, learned Single Judge held 1 (2016) 3 SCC 582 - 6 - WA No.100549 of 2022 that the licensees were entitled for renewal of their license for a period of three years, subject to they satisfying certain conditions, which was confirmed by the Division Bench in the writ appeals. The said order and judgment were the subject matter before the Hon’ble Apex Court and the Hon’ble Apex Court dismissed the SLP filed by the Railways, placing reliance on the said decision. Learned counsel contended that the petitioner would also be entitled for renewal of license in terms of the above. Learned counsel for the petitioner/appellant has not canvassed any other contention. 6. On the other hand, learned counsel appearing for the Railways would submit that the petitioner has no right to continue once the license is expired. Further, it is submitted that the decision of the Hon’ble Apex Court cited supra would have no application to the facts of the present case since the said decision related to the general minor units and special minor units and it would have no application to general major units. It is submitted that the petitioner was allotted general major unit to run fast food - 7 - WA No.100549 of 2022 unit in Gadag railway station. Further, it is also submitted that the decision relied by the learned counsel for the petitioner/appellant relates to 2010 Policy whereas subsequently, the railways have introduced 2017 Policy. Thus, they would pray for dismissal of the writ appeal. 7. The order sheet of the present appeal would indicate that this Court granted interim order of stay of the learned Single Judge’s order on 16.12.2022 and the same is continued till this date. On the basis of the interim order, the petitioner/appellant appears to have continued the fast food stall unit at Gadag railway station. 8. On hearing the learned counsel appearing for the parties and on perusal of the entire writ appeal papers, the only point which falls for our consideration is as to, “Whether the learned Single Judge’s order dismissing the writ petition requires interference?” 9. Answer to the above point would be in the Negative for the following reasons: - 8 - WA No.100549 of 2022 10. It is not in dispute that the petitioner/appellant was successful bidder and in terms of the letter of award of license dated 11.07.2009 he was allotted a major stall (fast food unit) at Gadag railway station and accordingly agreement between the petitioner and the respondent- Railways was entered into on 07.12.2011. In terms of Clause 16.1, 16.1.1 and 16.1.2 of the agreement, tenure of the major units is five years. Clause 16.1, 16.1.1 and 16.1.2 of the agreement read as follows: “16.1 TENURE OF MAJOR UNITS & GENERAL MINOR UNITS 16.1.1 Tenure of all major units including food courts, fast food units (except Food Plazas, Base Kitchens and AVMs) will be for a period of 5 years. There will be no renewals. 16.1.2 Tenure of AVMs will be made for a period of 5 years. There will be no renewals as per policy as these are major units.” 11. In terms of the above Clause in the agreement, the tenure of the license is for a period of 5 years with a definite condition that there will be no renewals. The petitioner/licensee knew about the tenure as on the date - 9 - WA No.100549 of 2022 of entering into agreement and the petitioner/appellant was aware of the fact that there would be no renewal. Once the license expires, the licensee has no right to continue. In the instant case, only on the basis of the interim order of this Court, the petitioner/appellant is continued to run major food stall at Gadag railway station. It is not open for the petitioner to seek renewal of license contrary to agreement. 12. The respondent/Railway Authorities have introduced 2017 Catering Policy. The petitioner has not made out any ground to declare 2017 Catering Policy as arbitrary. 13. This Court under Article 226 of the Constitution of India normally would not interfere with the policy decision of the authorities. Moreover, 2017 Policy is regarding commercial transaction of the respondent/Railway Authorities. Wherever it involves commercial activity, this Court would be slow in interfering with such commercial policies. In the instant case, the allotment of food stalls at the railway station is involved. - 10 - WA No.100549 of 2022 Such commercial policy could be interfered if one points out that such policy is so arbitrary, which would not stand to reasons. But, in the instant case the petitioner/appellant has not even pointed out any ground to determine as to whether the 2017 Catering Policy is arbitrary or unreasonable. 14. The one and only ground on which the petitioner/appellant argued the case is placing reliance on the decision of the Hon’ble Apex Court in the case of SENIOR DIVISIONAL COMMERCIAL MANAGER, SOUTH CENTRAL RAILWAYS AND OTHERS (supra). The said decision relates to general minor units and special minor units based on the Catering Policy of 2010. The Hon’ble Apex Court was dealing with the allotment of general minor units and special minor units. Moreover, the Catering Policy of 2010 provided for renewal of license for a period of three years, subject to they satisfying certain conditions in respect of minor units. The petitioner was allotted major stall i.e., fast food unit in Gadag railway station under letter dated 11.07.2009 and as such the - 11 - WA No.100549 of 2022 SENIOR DIVISIONAL COMMERCIAL MANAGER, SOUTH CENTRAL RAILWAYS AND OTHERS (supra) would have no application to the facts of the present case. 15. Learned Single Judge has rightly come to the conclusion that the Hon’ble Apex Court was basically considering the case of the members of the Association who were engaged in different kinds of business on the platforms. At paragraphs 11 and 12, it is observed as follows: “11. It is to be stated here that the Hon’ble Supreme Court was dealing with a case relating to renewal of licenses under the Catering Policy-2010. The Hon’ble Apex Court was basically considering the case of the members of the Association, who were engaged in different kinds of businesses on the platforms. This can be gathered from the judgment in which it is stated that the members of the Welfare Association had been granted licenses for running general minor units or special minor units in categories A, B and C of the Railway stations and the licenses had been granted in favour of the members prior to the creation of IRCTC under the Catering Policy-2005. The Hon’ble Supreme Court, in fact, was considering the effect of commercial circular No.37. The relevant - 12 - WA No.100549 of 2022 observations can be found in Civil Appeal Nos.618- 620/2016 supra at paragraph No.20, which reads as follows; “20. We are unable to agree with the contention advanced on behalf of the Appellants. The Railway Board issued Commercial Circular No. 37 dated 09.08.2010, which contained the following instructions: "1. Transfer of License Units: d. Zonal railways should renew all agreements which have expired or are due for expiry in the next 6 months by giving an extension, subject to a maximum extension of six months from the date of issue of Catering Policy, 2010." This circular clarifies that the renewal of the license is required to be granted to all the existing licensees of the Minor Units as per clauses 16 and 17 of the Catering Policy, 2010. It also becomes clear that the existing licensees need not be included in the tender process. Circular dated 23.08.2011 issued by the Chief Commercial Manager of South Central Railway directed all the Divisional Commercial Managers and other subordinate officers of the South Central Railway to confirm that the tenure of all GMUS and SMUs at "A1", "A" and "B" category stations shall be renewed after every 3 years on their satisfactory performance and payment of all dues and arrears as per the 2010 Policy. In view of the said circular, catering licenses of all the members of the respondent Association were renewed till July 2013.” 12. As could be seen from the said extract, the Hon’ble Apex Court was considering the case of the circular in relation to the existing licensees of - 13 - WA No.100549 of 2022 the minor units. Further in paragraph No.24, the Hon’ble Supreme Court has observed as follows; “24. One more important aspect to be taken note of by this Court is the non governance of railway property in the past 67 years since independence. Though, it is a recognized principle of law that the property of the railways is public property, yet in reality, it is the private players and industries that are allowed to carry on their business for transport of raw materials from one place to another. After the enactment of the Railways Act, 1989, the Rail Land Development Authority has been established under Chapter IIA of the Act to manage the railway property by framing policy the licensees, including fixing license fee or occupation charges in respect of the vast extent of vacant property from which huge revenue can be collected, which is a laudable object to cater to the need of the public at large. The periodical revision of license fee in respect of such big operators has not been done by the railways. Also, the Policy of not renewing the licenses of those persons who are members of the on respondents self-earning from these small units and making are completely dependent them participate in a public competition is absolutely unfair, unreasonable and arbitrary. The chances of such persons being deprived of their right to livelihood is also an important factor which has to be taken into - 14 - WA No.100549 of 2022 consideration by this Court to interpret the policy framed by the appellants.” 16. A licensee whose license is already expired would not be entitled to continue in the premises allotted to him. Moreover, when the policy under which the allotment of shop premises was made would not permit renewal, the petitioner/appellant cannot seek for renewal of license. Further, renewal cannot be claimed as a matter of right. In a similar fact situation, the Division Bench of the High Court of Delhi at New Delhi in the matter of S.RAMACHANDRUDU VS. UNION OF INDIA AND OTHERS2 at paragraphs 23 to 26 has held as follows: “23. Significantly, the expression ‘renewal’ finds no mention in Para 16.1.4 applicable to ‘Major Units’ in contradistinction with Paras 16.1.3, 16.2.1 and 16.2.2, which specifically stipulate an option of ‘renewal’ to the ‘General Minor Units’ (GMU) and ‘Special Minor Units’ (SMU). Instead, Para 16.1.4 of the Policy uses the expression ‘extension’ with respect to the tenure of the ‘Major Units’. 24. Firstly, the expressions ‘renewal’ and ‘extension’ have been judicially interpreted by the Supreme Court in Provash Chandra 2 2024 SCC OnLine Del 1634 - 15 - WA No.100549 of 2022 Dalui v. Biswanath Banerjee2 to hold that the said expressions have distinct legal consequences for the rights of a party. The Supreme Court held that the distinction between ‘extension’ and ‘renewal’ is chiefly that in case of renewal, a new agreement is executed, while in case of extension, the same agreement continues in force during extended period. The relevant paras 13 and 14 of the judgment reads as under: “13. In clause 9 of the lease it would be seen how and when the rent is to be paid and when the lease would be liable to be cancelled have been stated. Clause 11 stipulates that at the first instance the period of lease was made 10 years and in case the lessee acted in accordance with what was expected of him under clause 9, the period of the lease would be extended for a further period of 5 years up to 31-3-1961 at enhanced rent of Rs. 250 per month, and if the lessee continued to act in accordance with what was expected of him under clause 9 during this period of 5 years the period of the lease would be extended for a further period of 5 years, that is, up to 31-3- 1966 at a monthly rent of Rs. 300 and in case the lessee continued to act during this period as expected of him under clause 9 till the end of the period of 20 years he would be entitled by serving a notice to obtain an extension for a - 16 - WA No.100549 of 2022 further maximum period of one year at enhanced rent of Rs. 500 per month. 14. It is pertinent to note that the word used is “extension” and not “renewal”. To extend means to enlarge, expand, lengthen, prolong to carry out further than its original limit. Extension, according to Black's Law Dictionary, means enlargement of the main body addition of something smaller than that to which it is attached; to lengthen or prolong. Thus, extension ordinarily implies the continued existence of something to be extended. The distinction between “extension” and “renewal” is chiefly that in the case of renewal, a new lease is required, while in the case of extension the same lease continues in force during additional period by the performance of the stipulate act. In other words, the word “extension” when used in its proper and usual sense in connection with a lease means a prolongation of the lease. Construction of this stipulation in the lease in the above manner will also be consistent when the lease is taken as a whole. The purposes of the lease were not expected to last for only 10 years and as Mr. A.K. Sen rightly pointed out the schedule specifically mentioned the lease as “for a stipulated period of 20 years”. As - 17 - WA No.100549 of 2022 these words are very clear, there is very little for the court to do about it.” (Emphasis supplied) 25. In the facts of this case, the original agreement of license dated 04th December, 2010 executed between the parties already stands expired by efflux of time. The Appellant in order to continue the operation of the Food Plaza beyond 28th February, 2024 requires a renewal of the license in its favour, which in turn necessarily requires execution of the fresh license deed in its favour from the Respondent, IRCTC. 26. The omission of the expression ‘renewal’ in Para 16.1.4, which expressly governs the Food Plaza is a premeditated omission in the Policy and evidences that no right of ‘renewal’ has been reserved for the ‘Major Units’ (being Food Plaza) referred to in Para 16.1.4 in the Catering Policy, 2010. In contrast, the right of ‘renewal’ has been reserved for the ‘Minor Units’ (GMU/SMU) referred to in Para 16.1.3, 16.2.1 and 16.2.2. We are, therefore, prima facie of the opinion that the Appellant, being a ‘Major Unit’ (Food Plaza) is not entitled to apply for ‘renewal’ under the Catering Policy, 2010.” - 18 - WA No.100549 of 2022 17. The above decision makes it clear that the major unit (food plaza) is not entitled to apply for renewal under the Catering Policy 2010. 18. For the reasons recorded above, we are of the considered opinion that there is no merit in the writ appeal and accordingly writ appeal stands rejected. Sd/- (S G PANDIT) JUDGE Sd/- (C.M. POONACHA) JUDGE NC CT:VP