After a 13-year legal battle, the Himachal Pradesh Tourism Development Corporation today retained the right to operate the two landmark restaurants-Ashiana and Goofa - at the historic Ridge ground at Shimla, with the Supreme Court setting aside high court orders on leasing them out afresh.
Ashiana restaurant and Goofa bar and restaurant, the only two prominent eateries situated at the prime location on the Ridge Ground in Shimla, overlook the Mall Road and are famous among tourists especially foreigners due to their open space and scenic view especially in winters.
The top court, after 13-years of litigation, set aside the two orders of the Himachal Pradesh High Court of May 24, 2005 and July 5, 2005 by which it had directed the Shimla Municipal Corporation to invite bids from interested parties for giving the property on lease/license basis.
A bench of Chief Justice Dipak Misra and Justice A M Khanwilkar said that the high court order of May 24, 2005, "transcends beyond the relief claimed by the writ petitioner and more so, is a mandatory order passed at an interlocutory stage without recording any just and tangible reasons".
"As a result, besides setting aside the impugned judgment and orders dated May 24, 2005 and July 5, 2005, respectively, we are inclined to dispose of the said writ petition with the aforementioned observations. Thus, the...filed in the High Court of Himachal Pradesh at Shimla, be deemed to have been disposed of accordingly," the bench said.
It, however, said that the issue of outstanding dues payable by Himachal Pradesh Tourism Development Corporation (HPTDC) to the Shimla Municipal Corporation (SMC), could be resolved with the intervention of the state.
"In that, if HPTDC is financially incapable of settling the claim/demand of the Municipal Corporation, the State may have to provide financial assistance to HPTDC to the extent necessary, failing which the Municipal Corporation will be left with no other option but to take recourse to statutory remedies for recovery of its dues from HPTDC in relation to the subject premises," the bench said.
It said that since the state has also challenged the order of high court, it must take initiative to find out a suitable solution in accordance with law, "expeditiously and within a reasonable time", failing which it may be open to the SMC to resort to recovery proceedings against HPTDC and including eviction of HPTDC from the suit premises.
The apex court said that in its order the high court has not even adverted to the "efficacy of the subsisting contract between the Municipal Corporation and HPTDC" and if it had felt that rent payable by HPTDC was on the lower side then it should have first "authoritatively hold that HPTDC was not legally entitled to remain in occupation of the subject premises".
"It is unfathomable as to how the High Court could have passed the order dated May 24, 2005, to straightway direct the Municipal Corporation to issue tender notice. There is no indication in the order passed by the High Court on May 24, 2005, of having quashed the subsisting contract between Municipal Corporation and HPTDC," the bench said.
It said that without deciding on the issue of validity of the subsisting contractual terms and conditions between the Municipal Corporation and HPTDC, the High Court could not and should not have ventured to pass the order, such as dated May 24, 2005 and the July 5, 2005, order which was a consequential order.
"We hold that the interim orders passed by the High Court were in complete disregard of the scope of judicial review. Further, a mandatory order has been passed at an interlocutory stage by the High Court without even bothering to examine the efficacy of the subsisting contractual obligations of the Municipal Corporation and HPTDC," the apex court said.
It said the order of the high court was also in complete disregard to Himachal Pradesh Municipal Corporation Act, 1994, which mandates the procedure for grant of lease as -- first the proposal should be recommended by the Municipal Corporation and second, the agreement can be executed by the Corporation only after grant of prior sanction by the Government for leasing out the property.
The apex court also directed the SMC to refund the earnest money of Rs 10 lakh deposited by M/S N&S Resorts, which was the highest bidder in the court directed tender process with 9 per cent per annum from the date of deposit till its realization in twelve weeks from today.
The high court had on May 24, 2005, entertained a PIL filed by Ravinder Kumar Sankhayan, who had died during the pendency of case in apex court, claiming that SMC had leased out its properties to HPTDC at a rate much lower than the prevailing market rate, without conducting auction or resorting to tender process.
He had claimed that SMC had failed to recover the municipal taxes from HPTDC, including the rental/lease money, which was quite substantial, causing loss to the local body.
The high court had directed SMC to lease out the property through tender process to the highest bidder as the restaurants were situated in prime location and people who had offered to take the properties were ready to pay 10 times the rent paid by HPTDC.
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