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Friday, July 6, 2012

import of toxic wastes from industrialized countries to India, despite such wastes being hazardous to the environment and life of the people of this country. The Writ Petitioner sought to challenge the decision of the Ministry of Environment and Forests permitting import of toxic wastes in India under the cover of recycling, which, according to the Petitioner, made India a dumping ground for toxic wastes.= by reasserting the interim directions given with regard to the handling of hazardous wastes and ship breaking in the various orders passed in the writ petition from time to time and, in particular, the orders dated 13th October, 1997 and 14th October, 2003. The Central Government is also directed to ban import of all hazardous/toxic wastes which had been identified and declared to be so under the BASEL Convention and its different protocols. The Central Government is also directed to bring the Hazardous Wastes (Management & Handling) Rules, 1989, in line with the BASEL Convention and Articles 21, 47 and 48A of the Constitution. The further declaration sought for that without adequate protection to the workers and public, the aforesaid Rules are violative of the Fundamental Rights of the citizens and are, therefore, unconstitutional, is, however, rejected in view of what has been discussed hereinabove. 36. In the peculiar facts of the case, there will be no order as to costs.


|REPORTABLE              |

                        IN THE SUPREME COURT OF INDIA
                         CIVIL ORIGINAL JURISDICTION

                      WRIT PETITION (C) No.657 of 1995




1 RESEARCH FOUNDATION FOR SCIENCE,           … PETITIONER


2 TECHNOLOGY AND NATURAL RESOURCE


3 POLICY



                         VS.





           2 UNION OF INDIA & ORS.                            …
RESPONDENTS






                               J U D G M E N T



ALTAMAS KABIR, J.


1.    This writ petition has been  filed  by  the  Research  Foundation  for
Science Technology and Natural Resource Policy, through  its  Director,  Ms.
Vandna Shiva, for the following reliefs :
      “1.    direct  the  Union  of  India  banning  all  imports   of   all
           hazardous/toxic wastes;


      2.     direct  amendment  of  rules  in  conformity  with  the   BASEL
           Convention and Article 21, 47 and 48A  of  the  Constitution  as
           interpreted by this Court;


      3.    declare that without adequate  protection  to  the  workers  and
           public and without any provision of sound environment management
           of disposal of  hazardous/toxic  wastes,  the  Hazardous  Wastes
           (Management & Handling) Rules, 1989 are violative of Fundamental
           Rights and, therefore, unconstitutional;”

      On 29th October, 1995, this Court directed notice to issue on the writ
petition and also on the application for stay.

2.    The basic grievance of the Writ Petitioner  was  with  regard  to  the
import of toxic wastes from industrialized countries to India, despite  such
wastes being hazardous to the environment and life of  the  people  of  this
country.  The Writ Petitioner  sought  to  challenge  the  decision  of  the
Ministry of Environment and Forests permitting import  of  toxic  wastes  in
India under the cover of recycling,  which,  according  to  the  Petitioner,
made India a dumping ground for toxic wastes.  It  was  alleged  that  these
decisions were contrary to the provisions of  Articles  14  and  21  of  the
Constitution and also Article 47, which enjoins  a  duty  on  the  State  to
raise the standards of living and to improve public  health.   In  the  writ
petition it was also contended that Article  48A  provides  that  the  State
shall endeavour to protect and improve the environment and to safeguard  the
forests and wildlife of the country.

3.     In  the  writ  petition,  Ms.  Vandna  Shiva,  the  Director  of  the
Petitioner Foundation, who is a well-known environmentalist and  journalist,
while highlighting some of the tragedies which had occurred  on  account  of
either  dumping  or  release  of  hazardous  and  toxic  wastes   into   the
atmosphere, such as the tragedy  which  took  place  in  the  Union  Carbide
factory at Bhopal in 1984, referred to the BASEL Convention on  the  Control
of Transboundary Movements of Hazardous Wastes and their disposal.   It  was
submitted that an international awareness had been created under  the  BASEL
Convention against the movement of hazardous wastes and  their  disposal  in
respect  whereof  the  United  Nations  Environment  Programme  (UNEP)   had
convened  a  Conference  on  the  Global  Convention  on  the   Control   of
Transboundary  Movements  of  Hazardous  Wastes  pursuant  to  the  decision
adopted by the Governing Council of UNEP  on  17th  June,  1987.   The  said
Conference met at the European World Trade  and  Convention  Centre,  Basel,
from 20th to 22nd March, 1989. India also participated  in  the  Conference.
On the basis of the deliberations of the Committee, the BASEL Convention  on
the Control  of  Transboundary  Movements  on  Hazardous  Wastes  and  their
Disposal was adopted on 22nd March, 1989.  It was the grievance of the  Writ
Petitioner that since India became a signatory to the  BASEL  Convention  on
22nd September, 1992, it should have amended the  definition  of  “hazardous
wastes”, as provided in Article 3 read with Articles 4.1 and 13 of the  said
Convention. It was the further grievance of the Writ Petitioner  that  India
should have enacted laws in regard to the Transboundary Movement  procedures
with regard to  hazardous  wastes.   Some  of  the  relevant  provisions  of
Article 4 of the aforesaid Convention have been quoted in the writ  petition
and are extracted hereinbelow :

      1.    (a) Parties exercising their right to  prohibit  the  import  of
      hazardous wastes or other wastes for disposal shall inform  the  other
      parties of their decision pursuant to Article 13.


      (b) Parties shall prohibit or shall not permit the export of hazardous
      wastes and other wastes to  the  Parties  which  have  prohibited  the
      import of such wastes, when notified pursuant to sub-para (a) above.


      (c)   Parties shall  prohibit  or  shall  not  permit  the  export  of
      hazardous wastes and other wastes if the  State  of  import  does  not
      consent in writing to the specific import,  in  the  case  where  that
      State of import has not prohibited the import of such wastes.


      2.    Each Party shall take the appropriate measures to :
                       xxx                         xxx
      (c)   Ensure that persons involved  in  the  management  of  hazardous
      wastes or other wastes within it take such steps as are  necessary  to
      prevent pollution due to hazardous wastes  and  other  wastes  arising
      from such management and, if such pollution occurs,  to  minimize  the
      consequences thereof for human health and the environment;


      (d)   Ensure that the transboundary movement of hazardous  wastes  and
      other  wastes  is  reduced  to  the  minimum   consistent   with   the
      environmentally sound and efficient management of such wastes, and  is
      conducted in  a  manner  which  will  protect  human  health  and  the
      environment against the adverse effects which  may  result  from  such
      movement;
                       xxx                    xxx
      (g)   Prevent the import of hazardous wastes and other  wastes  if  it
      has reason to believe that the wastes in question will not be  managed
      in an environmentally sound manner.”


4.    Even restrictions on transboundary movement between parties  contained
in Article 6 of the Convention,  inter  alia,  provide  that  the  State  of
export shall not allow the exporter to commence the  transboundary  movement
until it has received written confirmation that the  notifier  has  received
from the State of  import  confirmation  of  the  existence  of  a  contract
between the exporter  and  the  disposer  specifying  environmentally  sound
management of the wastes in question.

5.     On  25th  March,  1994,  65  countries  which  participated  in   the
Convention agreed by consensus to ban all exports of hazardous  wastes  from
OECD to Non-OECD countries immediately. It is  the  grievance  of  the  Writ
Petitioner that inspite of such consensual decision to ban  all  exports  of
hazardous wastes from OECD to Non-OECD countries,  consistent  efforts  were
made by the industrialized countries to break down the  Non-OECD  solidarity
and to weaken the resolutions adopted at the BASEL Convention, and,  in  the
process, Asia was fast becoming a  vast  dumping  ground  for  international
waste traders.

6.    In the Writ Petition various instances were provided of  the  type  of
toxic wastes imported into the country under the garb  of  recycling.    The
Writ Petitioner has also drawn the attention of the Court to the  provisions
of the Hazardous Wastes (Management &  Handling)  Rules,  1989,  hereinafter
referred as the H.W.M.H. Rules, 1989, and complained of the  fact  that  the
same had not been implemented both by the Central Government and  the  State
Governments and Union Territories and  their  respective  Pollution  Control
Boards.

7.    Based on the said allegations, this  Court  initially  asked  all  the
State Governments and  Union  Territories  and  their  respective  Pollution
Control Boards to submit affidavits as to how  far  the  provisions  of  the
aforesaid Rules had been implemented.  The Central Government was  asked  to
file a comprehensive affidavit in  respect  thereof.   From  the  affidavits
filed, this Court appears to have come to the  conclusion  that  the  States
and their respective authorities did not seem to appreciate the  gravity  of
the matter and the need for taking prompt measures to  prevent  the  adverse
consequences of such neglect. In the said  background,  this  Court  by  its
order dated 13th October, 1997, appointed  a  High-Powered  Committee,  with
Prof. M.G.K. Menon as its Chairman, and referred 14 issues to the  Committee
on which it was required to give its report and recommendations.  Since  the
said 14 terms of reference are of great relevance in the matter of  disposal
of the writ petition, the same are reproduced hereinbelow :-
        “(1) Whether and to what extent the hazardous wastes listed  in  the
      Basel Convention have been banned by the  Government  and  to  examine
      which  other  hazardous  wastes,  other  than  listed  in  the   Basel
      Convention and the Hazardous Wastes (Management and  Handling)  Rules,
      1989, require banning.


        (2) To verify the present status of the  units  handling  hazardous
      wastes  imported  for  recycling  or  generating/recycling  indigenous
      hazardous  wastes  on  the  basis  of  information  provided  by   the
      respective States/UTs and determine the status  of  implementation  of
      the Hazardous Wastes (Management and Handling) Rules, 1989 by  various
      States/UTs and in the  light  of  directions  issued  by  the  Hon'ble
      Supreme Court.


        (3) What safeguards have been put in place to  ensure  that  banned
      toxic/hazardous wastes are not allowed to be imported?


        (4) What are the changes required in the existing laws to  regulate
      the functioning of units handling hazardous wastes and for  protecting
      the people (including  workers  in  the  factory)  from  environmental
      hazards?


        (5) To assess the adequacy of the existing facilities for  disposal
      of hazardous wastes in an environmentally sound  manner  and  to  make
      recommendations  about  the  most  suitable  manner  for  disposal  of
      hazardous wastes.


        (6) What is further required to be done  to  effectively  prohibit,
      monitor and regulate  the  functioning  of  units  handling  hazardous
      wastes keeping in view the existing body of laws?


        (7) To make recommendations as to what should be the  prerequisites
      for issuance of authorisation/permission under Rule 5 and Rule  11  of
      the Hazardous Wastes (Management and Handling) Rules, 1989.


        (8) To identify the criteria for designation of areas for  locating
      units handling hazardous wastes and waste disposal sites.


        (9) To determine as to whether the authorisations/permissions given
      by the State Boards for handling hazardous wastes  are  in  accordance
      with Rule 5(4) and Rule 11 of the Hazardous  Wastes  Rules,  1989  and
      whether the decision of the State Pollution Control Boards is based on
      any prescribed procedure of checklist.


        (10) To recommend a  mechanism  for  publication  of  inventory  at
      regular intervals giving areawise  information  about  the  level  and
      nature of hazardous wastes.


        (11) What should be the framework for reducing risks to environment
      and public health by stronger regulation and by  promoting  production
      methods and products which are ecologically friendly and  thus  reduce
      the production of toxics?


        (12) To consider any other related area as the Committee  may  deem
      fit.


        (13) To examine the quantum and nature  of  hazardous  waste  stock
      lying at the docks/ports/ICDs and recommend a mechanism for  its  safe
      disposal or re-export to the original exporters.


        (14) Decontamination of ships before they are exported to India for
      breaking.”


      Each one of the said terms of reference are  of  special  significance
as far as the reliefs prayed for in the writ petition  are  concerned.   The
said High Powered Committee, comprised of  experts  from  different  fields,
submitted its report after making a  thorough  examination  of  all  matters
relating to hazardous wastes.

8.    On 14th October, 2003, the Writ Petition was taken up  by  this  Court
to consider the report of  the  High  Powered  Committee  on  the  Terms  of
Reference  which  had  been  made   to   it.    Although,   initially,   the
deliberations with  regard  to  the  contents  of  the  Writ  Petition  were
confined to different toxic materials  imported  into  India,  at  different
stages of the proceedings, a good deal of emphasis came to be  laid  on  the
issue relating to imported waste oil lying in the ports and docks,  as  well
as on ship breaking. This Court observed that the ship  breaking  operations
could  not  be  allowed  to  continue,  without  strictly  adhering  to  all
precautionary principles, CPCB guidelines  and  upon  taking  the  requisite
safeguards, which have been dealt with extensively  in  the  report  of  the
High Powered Committee, which also included the working  conditions  of  the
workmen.

9.    One of the other issues which was required to be dealt  with  was  the
disappearance of hazardous  waste  from  authorized  ports/Indian  Container
Depots/Container Freight Stations and also  as  to  how  to  deal  with  the
containers lying there.  Since disappearance of hazardous waste was  one  of
the Terms of Reference, by order  dated  10th  December,  1999,  this  Court
directed that a list of importers who had made illegal imports be placed  on
record.  Since the same was not done, this  Court  on  3rd  December,  2001,
directed the Government to inquire into the matter, which  resulted  in  the
appointment of an eight-member Committee by the Government, chaired  by  Mr.
A.C. Wadhawan.  The report dated 26th July,  2002,  submitted  by  the  said
Committee suggested that action should be taken  against  the  importer  for
illegal import under the Customs Act,  1962,  and  also  under  the  Central
Excise Act, 1944.  This Court categorized the matter into  two  parts.   The
first part related to imports made and cleared, where the  consignments  had
already found their way to the  market.  The  second  part  related  to  the
stocks of hazardous waste lying at various  ports/ICDs/CFSs.   The  question
which arose was as to how the said stock was to be cleared from  where  they
were lying.  This Court was of the view that the stock in question could  be
divided into two categories; one, relating to imports of  goods  which  were
banned under the H.W.M.H. Rules, 1989, as amended  up  to  date  or  falling
under the banned  category  as  per  the  Basel  Convention  and  the  other
relating to waste in respect whereof there was no ban and  being  regulated,
it was permissible to recycle and reprocess the same within the  permissible
parameters by  specified  authorized  persons  having  requisite  facilities
under the Rules, as amended up to date.  The Court directed  that  the  said
consignments falling  under  the  said  category  were  to  be  released  or
disposed of or auctioned in terms of the Rules, to the registered  recyclers
and reprocessors.  However, in case the  importer  of  such  goods  remained
untraceable, the authorities were directed to deal  with  the  same  at  the
risk, cost and consequences of the importer.   It  was  specified  that  the
consignment of such importer could not be allowed to  remain  at  the  ports
etc. indefinitely, merely because the importer was not traceable.

10.   For the purpose of dealing with such consignments where  the  importer
could not be traced, this Court was of the view  that  the  same  should  be
dealt with, disposed  of/auctioned  by  a  Monitoring  Committee  which  was
appointed by the Court by the said order itself.  The  Monitoring  Committee
was comprised of existing  members  of  the  Committee  constituted  by  the
Ministry of Environment and Forests, along with one Dr. Claude Alvares,  NGO
and Dr. D.B. Boralkar.  The Committee  was  directed  to  oversee  that  the
directions of this Court were implemented in a time-bound fashion.

11.   One of the other issues which came up for  consideration  before  this
Court was the MARPOL Convention  which  made  it  compulsory  for  signatory
nations to allow discharge of sludge oil for the purposes of recycling.   In
the wake of the other issues  which  were  taken  up  by  this  Court  while
considering the report of  the  High  Powered  Committee  and  that  of  the
Wadhawan Committee, the issue relating  to  the  provisions  of  the  MARPOL
Convention was set apart for decision at a later stage.

12.   The original MARPOL Convention was signed on 17th February, 1973,  but
did not  come  into  force.  Subsequently,  in  combination  with  the  1978
Protocol, the Convention was brought into force on 2nd  October,  1983.   As
will be noticed from the acronym, the expression “MARPOL” is the short  form
of  “Marine  Pollution”.   The  same  was  signed  with  the  intention   of
minimizing pollution on the seas, which included dumping,  oil  and  exhaust
pollution.  Its object was to preserve the marine  environment  through  the
complete elimination of pollution by oil and other  harmful  substances  and
the minimization of accidental discharge of  such  substances.   As  far  as
this aspect of the matter is concerned, the Central Government was  directed
to file an affidavit indicating in detail how the said oil was  dealt  with.
The issue relating to the import of such sludge oil was left unresolved  for
decision at a subsequent stage.

13.   However, during the course of hearing  in  regard  to  the  import  of
waste oil purportedly in violation of the  H.W.M.H.  Rules,  1989,  the  two
dominating principles  relating  to  pollution,  namely,  the  polluter-pays
principle and precautionary principle, were examined at length.  The  report
of the Committee indicated that the hazardous waste oil  was  imported  into
the country in the garb of furnace oil and, in fact, the containers and  the
vessels in which they were being transported,  were  also  highly  polluted,
causing a tremendous  risk  to  the  environment  and  to  human  existence.
Ultimately, by the said order of  14th  October,  2003,  certain  directions
were given regarding the procedure  to  be  adopted,  with  regard  to  ship
breaking, to the Central Pollution Control  Board,  to  prepare  a  national
inventory for rehabilitation of  hazardous  waste  dump  sites.   The  State
Pollution Control Boards were directed to ensure that  all  parties  dealing
in hazardous chemicals which generated hazardous  wastes,  displayed  online
data in that regard outside their respective factories, on  the  pattern  of
Andhra Pradesh.  The Ministry of Environment and Forests were also  directed
to consider making provision for Bank Guarantees.   Certain  recommendations
were also made with regard to legislation in order  to  destroy  any  trans-
boundary movement of hazardous wastes or other wastes  and  to  punish  such
illegal trafficking stringently.

14.   The matter rested there and only interim directions  were  given  from
time to time till it surfaced again before the Court on 25th January,  2003.
 On this occasion,  the  focus  of  this  Court  was  directed  towards  the
presence of hazardous waste oil in  133  containers  lying  at  Nhava  Sheva
Port, as noticed by the High Powered Committee.  On the  directions  of  the
Court, the oil contained in the said 133 containers was sent for  laboratory
test to determine whether the same was hazardous waste oil  or  not.   After
such examination it was found  to  be  hazardous   waste.   Considering  the
detailed report submitted by the Commissioner of Customs (Imports),  Mumbai,
and the Monitoring Committee, and after  hearing  learned  counsel  for  the
parties, this Court  observed  that  the  issue  to  be  determined  in  the
proceedings was limited to the environment and in giving  proper  directions
for dumping consignments in question, having  regard  to  the  precautionary
principle and polluter-pays principle.  The main question before  the  Court
was whether only a direction was required to be issued for  the  destruction
of the consignment in order to protect the environment and, if not, in  what
other manner could the consignments be dealt with.   Having  considered  the
provisions  of  the  Basel  Convention  on  the  Control  of  Trans-Boundary
Movement of Hazardous Wastes and their  disposal,  and  the  report  of  the
Monitoring  Committing  recommending  destruction  of  the  consignments  by
incineration, but also keeping in mind the fact that  import  of  waste  oil
was permitted for the purpose of recycling, this Court directed  that  where
the consignment was  found  fit  for  recycling,  the  same  should  not  be
destroyed, but recycling should be permitted under the  supervision  of  the
Monitoring Committee. However, it was also recorded that  if  recycling  was
not considered advisable by the Government, the said consignment would  also
have to be destroyed by incineration along with other consignments. In  such
a case the cost of incineration was to be borne by the Government.

15.   Taking further note of the precautionary  principle  forming  part  of
the  Vienna  Declaration  and  also  having  regard  to  the   polluter-pays
principle, this Court directed that it would be feasible to dispose  of  the
oil under the supervision of the Monitoring Committee by incineration  which
would have no impact on the  environment.  It  was  directed  that  the  133
containers  in  question  be  destroyed   by   incineration   as   per   the
recommendations of the Monitoring Committee and under  its  supervision,  at
the cost of the importer which was assessed by the Monitoring  Committee  at
Rs.12/- per kilo, which would have to be paid by the importers  in  advance.
In the order dated 9th May, 2005, this Court took up for  consideration  the
Fifth Quarterly Report of March 2005,  filed  by  the  Monitoring  Committee
from which it was seen that the waste oil contained in  the  133  containers
had not been destroyed in terms of  the  direction  given  on  5th  January,
2005, on  account  of  non-payment  of  the  cost  of  incineration  by  the
importers. None of the importers had  made  the  payment  for  incineration,
though, a direction had been given  to  deposit  the  cost  of  incineration
within four weeks from  the  date  of  the  order.   However,  while  taking
serious note of non-payment of the incineration cost, this Court  also  felt
that the destruction of the waste oil could not be delayed any  further  and
directed immediate destruction of the waste oil in terms of order dated  5th
May, 2005, by the Monitoring Committee and for the said purpose the cost  of
incineration was to be initially borne by  the  Customs  Department,  to  be
recovered from the importers.  Simultaneously,  a  further  opportunity  was
given to the  importers  to  deposit  the  cost  of  incineration  with  the
Monitoring Committee within two weeks, failing which they were  directed  to
remain present in the Court on  18th  July,  2005,  and  to  show-cause  why
proceedings for contempt should not be taken against  them.  The  Monitoring
Committee was directed to file a report in that regard on the next date.

16.   One other aspect was also taken note of with regard to the  directions
given to the  Jawaharlal  Nehru  Port  Trust,  Mumbai  Port  Trust  and  the
Commissioner of Customs, to furnish requisite  information  with  regard  to
the  170  containers,  which  were  lying  unclaimed,  to   the   Monitoring
Committee.  Since the  same  had  not  been  filed  within  four  weeks,  as
directed, the Chairperson of the Jawaharlal Nehru  Port  Trust,  the  Mumbai
Port Trust and the Chief Commissioner of Customs Department,  were  directed
to file personal affidavits as to why the order of the Court  had  not  been
complied with. Subsequently, suo-motu contempt proceedings, being No.155  of
2005, in Writ Petition(C) No.657 of 1995, were initiated for  non-compliance
of the directions contained in the order of 9th May, 2005.

17.   As far as the suo-motu contempt proceedings are  concerned,  the  same
are an off-shoot of the various orders passed in the  writ  proceedings  and
the same will have to be considered separately from the reliefs  prayed  for
in the writ petition itself.

18.   At the very beginning of this judgment we have  set  out  the  reliefs
prayed for in the writ petition, which, inter alia, include a prayer  for  a
direction upon the Union of India to  ban  imports  of  all  hazardous/toxic
wastes and for a further direction to amend the  rules  in  conformity  with
the BASEL Convention and Articles  21,  47  and  48A  of  the  Constitution.
Apart from the above, a  declaration  has  also  been  sought  that  without
adequate protection of the workers and the public and without any  provision
of sound environment management of disposal of hazardous/toxic  wastes,  the
Hazardous Wastes (Management & Handling) Rules, 1989, are violative  of  the
Fundamental  Rights  guaranteed  under  the  Constitution  and,   therefore,
unconstitutional.

19.   Since the proceedings became a continuing mandamus,  this  Court  from
time to time took up several issues emanating from the first prayer  in  the
writ petition to ban imports of all  hazardous/toxic  wastes.   However,  in
the process, one of the  Conventions,  namely,  the  impact  of  the  MARPOL
Convention, though referred to, was not decided and  left  for  decision  at
the final hearing.

      Accordingly, that aspect of the matter has to be decided also in these
proceedings.

20. In one of the earlier orders  passed  on  5th  May,  1997,  two  Hon’ble
Judges had occasion to  deal  with  the  enormous  generation  of  hazardous
wastes in the country each day and Their Lordships were of the opinion  that
the said fact alone indicated sufficiently the magnitude of the problem  and
the promptitude with which it was needed to be  tackled  before  the  damage
became irreversible.   Their  Lordships  observed  that  prompt  action  was
required to be taken, not only by the Central Government, but  also  by  the
State Governments and the Central and the State  Pollution  Control  Boards.
Accordingly, notice was given to all the State  Governments  and  the  State
Control Boards to file their replies, and directions were  also  given  that
with effect from that date no authorization/ permission would  be  given  by
any authority for the import of wastes which had already been banned by  the
Central Government  or  by  any  order  made  by  any  Court  or  any  other
authority.  In addition, it was also directed  that  with  effect  from  the
date of the order, no import would be made or permitted by any authority  or
any person of any hazardous waste, which was already banned under the  Basel
Convention or was to be banned  subsequently,  with  effect  from  the  date
specified therein.  Notice was also issued to the State Governments to  show
cause as to why an order should not be made directing closure of  the  units
utilizing the hazardous wastes where provision had  already  been  made  for
requisite safe disposal sites.  In  addition,  the  State  Governments  were
also directed to show cause as to why immediate orders should  not  be  made
for the closure of all unauthorized hazardous waste handling units.

21.   Thereafter, during the pendency of the matter, a fresh  Special  Leave
Petition was filed, being SLP(C)No.16175 of 1997,  by  Dr.  Surendra  Dhelia
against the Union of India  and  others  regarding  import  of  contaminated
waste oil and their disposal, since despite directions given  to  the  State
Governments and the Union of India, no affidavits were forthcoming  and,  as
a result, on 4th February, 2002, a direction was given to the  Secretary  in
the Ministry of Environment and Forests to  file  affidavits  in  compliance
with the orders passed on 14th September, 2001 and 3rd  December,  2001.   A
sum of Rs.10,000/- was  also  imposed  as  costs  against  the  Ministry  of
Environment and Forests.

22.   The matter came up again before the Court on 24th September, 2003,  in
which  the  H.W.M.H. Rules,
1989, fell for consideration having regard to  Section  11  of  the  Customs
Act,  1962,  which  empowers  the  Central  Government  to  prohibit  either
absolutely or subject  to  such  conditions  as  may  be  specified  in  the
notification, the import and export of the goods, if satisfied  that  it  is
necessary so to do for any  of  the  purposes  stated  in  Sub-Section  (2).
Since on behalf of the Central Government it was submitted that  the  import
of 29 items had already been prohibited under Schedule 8  of  the  Hazardous
Waste  Rules,  the  Court  directed  the  Central  Government  to  issue   a
notification without further delay under Section  11  of  the  Customs  Act,
1962, prohibiting the import of the said 29  items.   Their  Lordships  also
noted that the BASEL Convention had banned 76 items.  Their  Lordships  were
of the view that the remaining items were also required to be examined  and,
if necessary, to  issue  additional  notifications  to
comply with any ban that may have  been  imposed  in  respect  of  remaining
items.

23.   What is more important is the fact that the Hon’ble Judges  took  note
of the provisions of the Hazardous  Waste  Rules  which  allowed  import  of
certain items subject to fulfillment  of  certain  conditions.   This  Court
directed that before the imported consignment  was  cleared,  the  requisite
notification was to be issued making the compliance of the  said  conditions
mandatory.  In particular, in paragraph  7  of  Their  Lordships’  order,  a
direction was given to the Competent Authority  to  the  effect  that  while
disposing of hazardous waste, in exercise of power under Sections 61 and  62
of the Major Port Trusts Act, 1963, they were required to  ensure  that  the
H.W.M.H. Rules, as amended up to date, and in particular, Rules  19  and  20
thereof, were complied with.

24.   The said direction becomes relevant in relation to  the  third  prayer
made in the writ petition, as  referred  to  hereinabove,  relating  to  the
constitutionality of the H.W.M.H. Rules, 1989.   One  thing  is  clear  that
even  at  the  interim  stage,  there  was  no  challenge  as  such  to  the
constitutionality of the aforesaid  Rules  and  that,  on  the  other  hand,
directions were given by the Court to ensure compliance thereof.

25.   Then came the orders relating to  the  import  of  133  containers  of
hazardous waste oil, in the garb  of  lubricating  oil,  which  led  to  the
appointment  of  a  Monitoring  Committee  to  oversee  the  destruction  by
incineration of the waste oil, as well as the containers thereof.   Detailed
orders having been passed in relation to the destruction of  the  waste  and
hazardous oil imported into the country in the garb of lubricating oil,  and
the directions given to the Monitoring Committee regarding re-export of  the
same, we will consider the impact of  the  MARPOL  Convention  against  such
background.

26.   The MARPOL Convention, normally referred to as “MARPOL 73/78”, may  be
traced to its beginnings in 1954, when the first conference was held and  an
International Convention was adopted for the Prevention of Pollution of  Sea
by Oil (OILPOL).  The same came into force on 26th July, 1958 and  attempted
to tackle the problem of pollution of the seas by oil, such as,
      (a) crude oil;
      (b) fuel oil;
      (c) heavy diesel oil; and
      (d) lubricating oil.



27.   The first Convention was amended subsequently in 1962, 1969 and  1971,
limiting the quantities of oil discharge into the sea  by  Oil  Tankers  and
also the oily wastes from use in the machinery  of  the  vessel.  Prohibited
zones were established extending the setting up of earmarked areas in  which
oil could be discharged, extending at least 50 miles from the nearest  land.
 In 1971, reminders were  issued  to  protect  the  Great  Barrier  Reef  of
Australia. 1973 saw the adoption of the  International  Convention  for  the
Prevention of Pollution from Ships. The said Convention,  commonly  referred
to as MARPOL, was adopted  on  2nd  November,  1973,  at  the  International
Marine Organization and covered pollution by :
      (i)   oil;
      (ii)  chemicals;
      (iii) harmful substances in packaged form;
      (iv)  sewage; and
      (v)   garbage

      Subsequently, the 1978 MARPOL Protocol was adopted at a Conference  on
Tanker Safety and Pollution Prevention in February, 1978.

28.   The overall objective of  the  MARPOL  Convention  was  to  completely
eliminate pollution of the marine environment by discharge of oil and  other
hazardous  substances  from  ships  and  to  minimize  such  discharges   in
connection with accidents involving ships. The MARPOL 73/78  Convention  has
six  Annexures  containing  detailed   regulations   regarding   permissible
discharges, equipment on board ships, etc.  They are as follows :


      Annex I   : Regulations for the Prevention  of  Pollution  by  Oil,  2
      October, 1983.


      Annex II : Regulations for the Control of Pollution by Noxious  Liquid
      Substances (Chemicals) in Bulk, 6 April, 1987.


      Annex III : Regulations for the Prevention  of  Pollution  by  Harmful
      Substances Carried by Sea in Packaged Form, 1 July 1992.


      Annex IV : Regulations for the Prevention of Pollution by Sewage  from
      ships, 27 September 2003.


      Annex V  : Regulations for the Prevention of Pollution by Garbage from
      Ships, 31 December 1988.


      Annex VI  : Regulations for the Prevention of Air Pollution from Ships
      and Nitrogen oxide.  Will enter into force on 19 May 2005

  29. Apart from the said Regulations, the MARPOL Convention  also  contains
      various Regulations with regard to inspection of  ships  in  order  to
      ensure due compliance with the requirements of the Convention.

30.   India is a signatory, both to the BASEL Convention as also the  MARPOL
Convention, and is, therefore, under an obligation to ensure that  the  same
are duly implemented in relation to import  of  hazardous  wastes  into  the
country.  As we have noticed earlier, the BASEL  Convention  prohibited  the
import of certain hazardous substances on  which  there  was  a  total  ban.
However, some of the other pollutants, which have been identified,  are  yet
to be notified and, on the other hand, in order to prevent pollution of  the
seas, under the MARPOL Convention  the  signatory  countries  are  under  an
obligation to accept the discharge of  oil  wastes  from  ships.   What  is,
therefore, important is for the concerned authorities to  ensure  that  such
waste oil is not allowed to contaminate the surrounding areas and  also,  if
suitable, for the purposes of recycling, to  allow  recycling  of  the  same
under strict supervision with entrusted units and,  thereafter,  to  oversee
its distribution for reuse.

31.   As far as the first two prayers in the writ  petition  are  concerned,
the same have already been taken care of by the orders dated  13th  October,
1997 and 14th October, 2003.  By the first of the  two  orders,  this  Court
appointed  the  High-Powered  Committee  with  Prof.  M.G.K.  Menon  as  its
Chairman and 14 issues were referred to the said Committee.  After the  said
Committee submitted its Report, another Committee under the Chairmanship  of
Mr. A.C. Wadhawan  was  appointed  to  enquire  into  the  disappearance  of
hazardous wastes from various ports and container depots, and  the  question
relating to the working conditions of the workmen who  handle  such  wastes.
After the Wadhawan Committee submitted its Report, various  directions  were
given with regard to the handling of such  hazardous  wastes.   Furthermore,
the contamination risks involved in ship breaking also came  into  focus  in
the light of the  provisions  of  the  Hazardous  Wastes  Rules,  1989,  and
directions were given as to how ships, which were carrying wastes,  were  to
be dealt with  before  entering  into  Indian  waters,  which  included  the
prohibition on the  exporting  country  to  export  such  oil  or  substance
without the concurrence and clearance from the  importing  country.   During
the course of hearing, an issue was raised by  Mr.  Sanjay  Parikh,  learned
counsel appearing for the petitioner, that some conditions may be laid  down
in relation to vessels containing hazardous wastes  entering  Indian  waters
without proper compliance with the provisions of the BASEL  and  the  MARPOL
Conventions. However, since the question of ship breaking  and  distribution
of  hazardous  wastes  are  being  considered  separately  in  the  contempt
proceedings,  in  these  proceedings  we  expect  and  reiterate  that   the
directions contained in the BASEL Convention have to  be  strictly  followed
by all the concerned players, before a vessel is  allowed  to  enter  Indian
territorial waters and beach at any of the beaching facilities in  any  part
of the Indian  coast-line.   In  case  of  breach  of  the  conditions,  the
authorities shall impose the  penalties  contemplated  under  the  municipal
laws of India.

32.   The directions contained in the second order is based on the  polluter
pays principle, which is duly recognized as one of the  accepted  principles
for dealing with violation of the BASEL Convention and the  H.W.M.H.  Rules,
1989, and the same  will  be  applicable  whenever  such  violations  occur.
However, till such time as a  particular  product  is  identified  as  being
hazardous, no ban can be imposed on its import on the  ground  that  it  was
hazardous.  Such import will, however, be subject  to  all  other  statutory
conditions and restrictions, as may be prevailing on  the  date  of  import.
Accordingly,  the  general  prayer  made  in  the  writ  petition  that  the
Government of India should put a total ban on all hazardous wastes,  can  be
applied in respect of such hazardous wastes as have been identified  by  the
BASEL Convention and its Protocols over the years and/or where  import  into
the country have been restricted by the municipal laws of India. In  respect
of such banned items, directions have already been given in the order  dated
13th October, 1997, to issue a  notification  to  ban  the  import  of  such
identified hazardous substances. In the event, any other  items  have  since
been identified, the Central Government is  directed  to  issue  appropriate
notifications for banning the import of such hazardous substances as well.

33.   The third prayer, that in the event of non-compliance, the  provisions
of the Hazardous Wastes (Management  &  Handling)  Rules,  1989,  should  be
declared as unconstitutional, cannot be granted, since the same are  in  aid
and not in derogation of the provisions of Articles 21, 39(e),  47  and  48A
of the Constitution. In fact, as mentioned hereinabove, even at the  interim
stage,  directions  were  given  for  compliance  with   the   said   Rules,
particularly in the matter of destruction of the waste oil contained in  170
containers by incineration at the cost of the importer.

34.   The writ petition has been entertained and has also  been  treated  by
all concerned not as any kind of adversarial litigation, but  litigation  to
protect the environment from contamination on account of  attempts  made  to
dump hazardous wastes in the country, which would ultimately result  in  the
destruction, not only of the environment, but also the ecology as well  and,
in particular, the fragile marine  bio-diversity  along  the  Indian  Coast-
line.  The petitioner Foundation has  played  a  very  significant  role  in
bringing into focus some very serious questions involving  the  introduction
of  hazardous  substances  into  the  country,  which  needed  the   Courts’
attention to be drawn having regard  to  the  BASEL  Convention,  aimed  and
protecting marine biology and countries having  coast-lines  alongside  seas
and oceans.

35.   The writ petition  is,  therefore,  disposed  of  by  reasserting  the
interim directions given with regard to the  handling  of  hazardous  wastes
and ship breaking in the various orders passed in  the  writ  petition  from
time to time and, in particular, the orders dated  13th  October,  1997  and
14th October, 2003.  The Central Government is also directed to  ban  import
of all hazardous/toxic wastes which had been identified and declared  to  be
so under the BASEL Convention and  its  different  protocols.   The  Central
Government is also directed to bring  the  Hazardous  Wastes  (Management  &
Handling) Rules, 1989, in line with the BASEL Convention  and  Articles  21,
47 and 48A of the Constitution.  The further  declaration  sought  for  that
without adequate protection to the workers and public, the  aforesaid  Rules
are violative of the Fundamental Rights of the citizens and are,  therefore,
unconstitutional, is, however, rejected in view of what has  been  discussed
hereinabove.

36.   In the peculiar facts of the case,  there  will  be  no  order  as  to
costs.



                                                     ………………………………………………………J.
                                     (ALTAMAS KABIR)



                                                     ………………………………………………………J.
                                     (J. CHELAMESWAR)
New Delhi
Dated: 6th July, 2012.

-----------------------
44


FIR only with regard to Taj Heritage Corridor Project case. That order nowhere mentioned about lodging of second FIR in regard to the disproportionate assets of the petitioner.= whether FIR No. R.C. 0062003A0019 dated 05.10.2003 lodged under Section 13(2) read with Section 13 (1) (e) of the Prevention of Corruption Act, 1988 (hereinafter referred to as “the PC Act”) against the petitioner herein to investigate into the matter of alleged disproportionate assets is beyond the scope of the directions passed by this Court in the order dated 18.09.2003 in I.A. No. 376 of 2003 in W.P. (C) No. 13381 of 1984 titled M.C. Mehta vs. Union of India and Others, (2003) 8 SCC 696?


                                     REPORTABLE


                        IN THE SUPREME COURT OF INDIA

                        CRIMINAL ORIGINAL JURISDICTION


                 1 WRIT PETITION (CRIMINAL) NO. 135 OF 2008



Ms. Mayawati                                      .... Petitioner (s)

            Versus

Union of India & Ors.                          .... Respondent(s)

                                      2







                               J U D G M E N T


P.Sathasivam,J.

1)    The only question raised in this writ petition,  filed  under  Article
32 of the Constitution of India, is as to whether FIR No. R.C.  0062003A0019
dated 05.10.2003 lodged under Section 13(2) read with Section 13 (1) (e)  of
the Prevention of Corruption Act, 1988 (hereinafter referred to as  “the  PC
Act”) against the petitioner  herein  to  investigate  into  the  matter  of
alleged disproportionate assets  is  beyond  the  scope  of  the  directions
passed by this Court in the order dated 18.09.2003 in I.A. No. 376  of  2003
in W.P. (C) No. 13381 of 1984 titled M.C.  Mehta  vs.  Union  of  India  and
Others, (2003) 8 SCC 696?
2)    The case of  the  petitioner  as  stated  in  the  writ  petition,  is
summarized hereunder:
(a)   On the date of filing of this writ petition  before  this  Court,  the
petitioner was the Chief Minister of U.P.  Earlier also, the petitioner  had
been the Chief Minister of U.P. for three times.  The  petitioner  had  also
served as a Member of Parliament many a time both as a Member of  Lok  Sabha
and Rajya Sabha and had also served as a Member of Legislative Assembly  and
Legislative Council of the State of U.P.  The petitioner is a  law  graduate
and had been a teacher from 1977 to 1984.  At  present,  the  petitioner  is
the President of a National Political Party called as “Bahujan  Samaj  Party
(BSP)”, which is one of the six National Parties recognized by the  Election
Commission of India.
(b)   This Court, by order dated 16.07.2003 in I.A. No. 387 of 2003 in  Writ
Petition (C) No. 13381 of 1984 titled M.C. Mehta vs. Union of India  &  Ors.
directed the CBI to conduct an inquiry on the basis of an I.A. filed in  the
aforesaid writ petition alleging various  irregularities  committed  by  the
officers/persons in the Taj  Heritage  Corridor  Project  and  to  submit  a
Preliminary Report.
(c)   By means of an order  dated  21.08.2003,  this  Court  issued  certain
directions to the CBI to interrogate and verify the assets  of  the  persons
concerned with regard to outflow of Rs. 17 crores which was alleged to  have
been released without proper sanction for the said Project.  When  the  case
was taken up for hearing on 11.09.2003, a report was submitted  by  the  CBI
and it was directed to be kept in a sealed cover in the Registry.
(d)   This Court, in its further order dated 18.09.2003,  on  the  basis  of
the  report  dated  11.09.2003,  granted  further  time  to  the   CBI   for
verification of the assets  of  the  officers/persons  involved.   The  CBI-
Respondent No. 2 herein submitted a report on 18.09.2003 before  this  Court
which formed the basis  of  order  dated  18.09.2003  wherein  the  CBI  was
directed to conduct an inquiry with respect to  the  execution  of  the  Taj
Heritage Corridor Project under Taj Trapezium Zone (TTZ) Area at Agra.
(e)   Pursuant to the orders of this Court, an FIR was lodged on  05.10.2003
being RC No. 0062003A0018/2003 under Section 120-B read with  Sections  420,
467, 468 and 471 IPC and under Section 13(2) read with Section  13(1)(d)  of
the PC Act against several persons including the petitioner herein.  In  the
said FIR, certain details and several developments  which  took  place  with
regard to the aforesaid Project have been given.   As  per  the  allegations
contained in  the  report  dated  11.09.2003,  several  irregularities  were
allegedly being found in the  aforesaid  Project.   Pursuant  to  the  same,
investigation has been completed and the report was forwarded to obtain  the
sanction from the competent authority, namely, the Governor for  prosecuting
the Chief Minster of the State.  The Governor, by  order  dated  03.06.2007,
declined to accord sanction to prosecute the petitioner.
(f)   According to the petitioner, in the aforesaid FIR, it was stated  that
this Court also directed the CBI to conduct an  inquiry  pertaining  to  the
assets of the officers/individuals concerned in  the  aforesaid  Project  as
mentioned in the judgment passed by this Court  in  the  aforesaid  case  in
order to ascertain whether any mis-appropriation of  funds  have  been  done
with regard to outflow of Rs. 17 crores released  for  the  construction  of
said Project.  A perusal of the order dated  18.09.2003  would  reveal  that
whatever directions were issued by this Court were only in  respect  of  Rs.
17 crores alleged to have been released without proper  sanction  and  there
is not even a whisper about making an investigation into  any  other  assets
of the persons involved in general.  In other words, the scope of the  order
of this Court was limited to the  extent  of  money  released  in  the  said
Project and not otherwise.  This is clear  from  the  order  of  this  Court
dated 18.09.2003 wherein it had specifically observed about lodging  of  FIR
only with regard to Taj Heritage Corridor Project case.  That order  nowhere
mentioned about lodging of second FIR  in  regard  to  the  disproportionate
assets of the petitioner.
(g)   It is the further case of the petitioner that contrary to  the  orders
of this Court, with mala fide intentions, the  CBI  registered  another  FIR
being R.C. No. 19 of 2003 on the same date i.e. 05.10.2003 only against  the
petitioner  alleging  therein  that  in  pursuance  of  the   orders   dated
21.08.2003, 11.09.2003 and 18.09.2003 passed by this Court,  they  conducted
an inquiry with regard to the  acquiring  of  disproportionate  movable  and
immovable assets by the petitioner and her close relatives and on the  basis
of this inquiry lodged the said FIR,  whereas  there  was  no  direction  or
observation by this Court to inquire into the assets of the  petitioner  not
related to the said Project case.
(h)   The said FIR has been lodged by Shri K.N.  Tewari,  Superintendent  of
Police, CBI/ACP, Lucknow, however, in the column of complaint at page No.  2
of the FIR, the name of the  complainant/informant  has  been  mentioned  as
Shri Inder Pal, Assistant Registrar, PIL Branch,  Supreme  Court  of  India,
New Delhi even  though  no  such  order  or  direction  issued  by  him  for
registration of the case.  It is further pointed out  that  Shri  Inder  Pal
has not signed any such  FIR  as  complainant/informant.   Pursuant  to  the
impugned FIR - R.C. No. 19 of 2003  the  CBI  conducted  raids,  search  and
seizure operations at all the premises of the petitioner and  her  relatives
and seized all the bank accounts.
(i)   The petitioner has made several representations to the CBI  officials,
the State Minister of Personnel and the Hon’ble  Prime  Minister  who  heads
the Personnel Department drawing their attention that the Supreme Court  had
not given any such direction or authority to the CBI  to  lodge  an  FIR  in
respect to the alleged disproportionate assets and  investigate  the  entire
assets of the petitioner from the year 1995 which have no relation with  the
case of Taj Heritage Corridor Project which came into being only in  August,
2003.  In spite of several reminders and further representations, till  date
no communication has been received from the CBI.  The absence of  any  reply
by any of the  authorities  including  the  CBI  shows  that  there  was  no
direction or authority to the CBI in the order dated 18.09.2003 to lodge  an
FIR or to investigate into the  assets  of  the  petitioner  which  are  not
related to the said Project.  Hence,  it  was  incumbent  upon  the  CBI  to
comply with the  provisions  of  Section  6  of  the  Delhi  Special  Police
Establishment Act, 1946 (in short ‘DSPE Act’) which makes it  obligatory  to
obtain the consent of the  Government  of  the  concerned  State  to  confer
jurisdiction on the CBI to  investigate  in  any  case  arising  within  the
jurisdiction  of  a  State.   In  the  present  case,  FIR  was  lodged  and
investigation  was  conducted  without  obtaining  consent  of   the   State
Government which is in flagrant violation of Section 6 of the DSPE Act.   In
the absence of the consent of the State Government, the  whole  exercise  of
the CBI about lodging of FIR  and  investigating  into  the  assets  of  the
petitioner  not  related  to  Taj  Heritage  Corridor  Project  is   without
jurisdiction and, therefore, the same is non est and void ab initio.
(j)   It is  further  pointed  out  that  this  Court  in  its  order  dated
25.10.2004, after perusing the investigation reports filed by the CBI,  held
that no link was found between  the  irregularities  alleged  to  have  been
found in respect to the assets matter and the Taj Heritage Corridor  Project
which was the subject-matter of the reference before the Special Bench.
(k)   The fact that this Court had stopped monitoring the  assets  case  was
again reiterated in the order dated 07.08.2006 passed by this Court.
(l)   On 27.11.2006, this Court finally decided the issue in respect to  the
FIR being R.C. No. 18 relating to the Taj Heritage Corridor matter  reported
in M.C. Mehta (Taj Corridor Scam) vs. Union of India & Ors.,  (2007)  1  SCC
110.  In the said judgment, this Court observed that it  should  not  embark
upon an enquiry in regard to  the  allegations  of  criminal  misconduct  in
order to form an opinion  one  way  or  the  other  so  as  to  prima  facie
determine guilt of a person or otherwise.  When the matter  came  up  before
the Governor of U.P. to grant or refuse sanction for prosecution, he  sought
legal opinion from the Additional Solicitor General of India  and  based  on
his opinion and on  appreciation  of  entire  materials,  the  Governor  has
concluded that the petitioner was  not  even  remotely  connected  with  the
sanction of the said Project or the payment released for  the  same.   After
the above order of the Governor, the directions given by this Court  in  the
order dated 18.09.2003 were fully complied  with  including  in  respect  to
consider violations of the provisions of the PC Act.  After this, there  was
no  justification  or  authority  with  the  CBI  to   continue   with   the
investigation in other personal assets of the petitioner.
(m)   On 05.06.2007, the CBI moved an application before the Special  Judge,
Anti Corruption Bureau, (CBI),  Lucknow  informing  that  the  Governor  had
refused to grant sanction.  On perusal of all the  materials  including  the
order of the Governor declining to grant sanction, the  Special  Judge  held
that in the absence of sanction to prosecute the petitioner, the  Court  has
no jurisdiction to take cognizance.
(n)   The order of the Governor was also challenged  before  this  Court  in
Writ Petition (Civil) No. 434 of 2007.  However, this Court, by order  dated
06.08.2007,  dismissed  the  same  as  withdrawn.   Even   thereafter,   the
petitioner has made several representations to the  Director,  CBI  to  drop
the investigation on the basis of the aforesaid FIR.  However,  the  CBI  is
bent upon harassing the petitioner.  Hence, she  approached  this  Court  by
filing the present writ petition.
Stand of the CBI-Respondent No.2:
3)    Pursuant to the notice issued on 15.05.2008, the  CBI-Respondent  No.2
herein has filed its counter affidavit wherein it was  stated  that  in  the
order dated 18.09.2003 of  this  Court,  there  was  a  clear  direction  to
register an FIR  for  investigating  into  disproportionate  assets  of  the
petitioner on the ground that in  the  said  order  it  was  mentioned  that
“apart from what has been stated in the reports with regard to  the  assets,
the   learned   ASG   Mr.   Altaf   Ahmad   has   submitted   that   further
inquiry/investigation is necessary by the CBI”.  It is further  stated  that
the validity of the aforesaid FIRs was not disturbed by the  Allahabad  High
Court by its order dated 22.10.2003 on the ground that the FIR  in  question
was filed as per the directions of this Court.  It is further stated by  the
CBI that the FIR No. RC 19 dated 05.10.2003 under Section  13(2)  read  with
Section 13(1)(e) of the  PC  Act  reveal  the  details  of  huge  amount  of
disproportionate assets possessed by the petitioner and her  family  members
beyond their known sources of income.
Further case of the petitioner:
4)    A  rejoinder  affidavit,  supplementary  affidavit  and  supplementary
counter affidavits have also  been  filed  wherein  subsequent  developments
which took place during the  pendency  of  the  writ  petition,  especially,
passing of  various  orders  by  the  Income  Tax  Authorities,  Income  Tax
Appellate Tribunal and the Delhi High Court in favour of the petitioner  for
different assessment years have  been  mentioned  holding  that  all  income
shown in her accounts in the form of  gift  or  otherwise  are  genuine  and
legal, covering from 1995 to 2004  of  which  period  the  assessments  were
reopened, investigated and reassessed.
Case of the intervenor:
5)    During the pendency of this writ petition, which was  filed  in  2008,
one Mr. Kamlesh Verma has filed I.A. No. 8 of 2010 claiming  that  he  is  a
social worker and petitioner  in  Writ  Petition  No.  2019  of  2009  (M/B)
concerning FIR being RC No. 18 dated  05.10.2003  for  intervention  in  the
above matter and to assist the Court.  By pointing out that it  was  he  who
challenged the order of the Governor declining to grant sanction in  respect
of FIR No. 18 and filed Writ Petition No. 2019 of 2009 which is  pending  in
the Allahabad High Court, Lucknow Bench, sought to  intervene  to  put-forth
certain factual details.  In the said application, the intervener  has  also
highlighted various earlier  orders  of  this  Court.   The  said  I.A.  was
resisted by the  petitioner  by  pointing  out  that  in  the  present  writ
petition the petitioner seeks quashing of the second FIR i.e.  R.C.  No.  19
only on the ground that there was no  such  direction  in  the  order  dated
18.09.2003  passed  by  this  Court.   The   intervention   application   is
therefore, misconceived.  It is also pointed out  that  the  intervener  has
filed his writ petition in Lucknow in 2009 and his intervention  application
was filed on 08.09.2010 whereas the petitioner had filed  writ  petition  in
May, 2008 and this Court had  issued  notice  on  15.05.2008.   It  is  also
pointed out that the intervener was not associated with the  Project  matter
before this Court at any stage when orders  were  passed  on  several  dates
commencing from 2003 ending with 2009.
6)    In the light of the above pleadings  of  the  parties,  we  heard  Mr.
Harish  Salve,  learned  senior  counsel  for  the  petitioner,  Mr.   Mohan
Parasaran, learned Additional Solicitor General for the Union of  India  and
CBI and Ms. Kamini Jaiswal, learned counsel for the intervener.
7)     The  relief(s)  sought  for  in  the  writ  petition  are  reproduced
hereunder:-
      “I. Issue a Writ, Order or  direction  in  the  nature  of  certiorari
      quashing the FIR No. R.C. 0062003A0019/2003 dated 05.10.2003 lodged by
      Superintendent  of  Police,   CBI/ACB,   Lucknow   and   investigation
      proceedings being made in pursuance thereof.


      II.   Issue a Writ, Order or  direction  in  the  nature  of  Mandamus
      restraining the respondent no.2  and  3  from  proceeding  further  in
      pursuance to the said FIR and direct them to close and drop  the  said
      proceedings;


      III.  Issue a writ, order or  direction  in  the  nature  of  mandamus
      directing the release of all seized bank accounts  of  the  petitioner
      which have been seized by CBI in pursuance to the impugned FIR.


      IV.   Issue an appropriate writ, order  or  direction  declaring  that
      this Hon’ble court under Article 32/136/142  of  the  Constitution  of
      India or the High Court under Article 226 of the Constitution of India
      can  not  direct  the  Central  Bureau  of  Investigation  (CBI),   an
      establishment created under the  Delhi  Special  Police  Establishment
      Act, 1946 to investigate a cognizable offence which is alleged to have
      taken place in a State without the consent  of  the  State  Government
      under Section 6 of the Delhi Special Police Establishment Act, 1946.


      V.    Issue any other Writ, order  or  direction  which  this  Hon’ble
      Court may deem fit and proper in  the  circumstances  of  the  present
      case.”

8)    It is clear from the narration of  facts  as  well  as  the  relief(s)
sought for in the writ petition that the petitioner is aggrieved  of  second
FIR being No. R.C. 0062003A0019 dated 05.10.2003.  It  is  also  clear  that
the petitioner has assailed the said FIR on the ground  that  there  was  no
direction by this Court in its  order  dated  18.09.2003  which  could  have
empowered the CBI to lodge two FIRs, namely, (i) FIR No.  R.C.  0062003A0018
dated 05.10.2003 under Section 120-B read with Sections 420, 467,  468,  and
471 IPC and Section 13(2)  read  with  Section  13(1)(d)  of  the  P.C.  Act
against the petitioner as well as 10 other accused  persons  in  respect  of
Taj Corridor matter and (ii) FIR  No.  R.C.  0062003A0019  dated  05.10.2003
under Section 13(2) read with Section 13(1)(e) of the P.C. Act  against  the
petitioner only.      It is the specific stand of the CBI that in the  order
dated 18.09.2003 passed by this Court in  I.A.  No.  376  of  2003  in  Writ
Petition No. 13381 of 1984 - M.C. Mehta  vs.  Union  of  India  and  Others,
(2003) 8 SCC 696, there was  a  clear  direction  to  register  an  FIR  for
investigating into disproportionate assets of the petitioner on  the  ground
that in the said order, it is mentioned  that  “apart  from  what  has  been
stated in the reports with regard to the assets, the learned ASG  Mr.  Altaf
Ahmed has submitted that further inquiry/investigation is necessary  by  the
CBI”.  It is also their stand that the validity of the  aforesaid  FIRs  was
not disturbed by the Allahabad High Court by its order dated  22.10.2003  on
the ground that the FIR in question was filed as per the directions of  this
Court.   It  is  further  stated  that  the  second  FIR  being   No.   R.C.
0062003A0019 dated  05.10.2003  revealed  the  details  of  huge  amount  of
disproportionate assets possessed by the petitioner and her  family  members
beyond their known sources of income.
9)    As against the abovesaid stand of the  CBI,  the  petitioner,  in  the
form of rejoinder and supplementary affidavits, has  pointed  out  that  all
income shown in her accounts in the form of gift or  otherwise  are  genuine
and legal covering from 1995 to 2004.  It is further pointed  out  that  all
orders passed by the Income Tax Authorities have been brought on record  and
all of them attained finality and no further appeal is pending against  them
and all the assessments were reopened investigated and re-assessed.
10)   The petitioner has also filed a  consolidated  compilation  of  orders
passed by this Court commencing  from  16.07.2003  ending  with  27.04.2009.
Mr. Harish Salve, learned senior counsel for the petitioner  and  Mr.  Mohan
Parasaran, learned ASG took  us  through  all  those  orders.   Among  those
orders, we are very much concerned about the order dated 18.09.2003.  Before
going into the various directions issued in  the  said  order,  it  is  also
relevant to refer  the  earlier  orders  dated  16.07.2003,  21.08.2003  and
11.09.2003.  It is clear from those orders that this Court  by  order  dated
30.12.1996 in M.C. Mehta (Taj Trapezium  Matter)  vs.  Union  of  India  and
Others, (1997) 2 SCC 353 issued  a  number  of  directions  to  protect  the
national and world  heritage  monument,  namely,  the  Taj.   Thereafter,  a
number of interim applications were filed by the persons concerned who  were
required to shift their business or manufacturing  activities.   This  Court
has  also  appointed  a  Monitoring  Committee  to  report   whether   those
directions issued by this Court are complied with or not.
11)   In the order dated 16.07.2003 – M.C. Mehta  vs.  Union  of  India  and
Others, (2003) 8 SCC 706, this Court, in order to find out who  cleared  the
project, i.e., construction of the ‘Heritage Corridor’ at Agra and for  what
purpose it  was  cleared  without  obtaining  necessary  sanction  from  the
Department concerned and whether there was any  illegality  or  irregularity
committed by the officers/persons, came to the conclusion  that  inquiry  by
CBI is necessary.  Accordingly, in para 16 of the  said  order,  this  Court
directed the Director of  CBI  to  see  that  inquiry  with  regard  to  any
illegality/irregularity committed by the officers/persons  be  conducted  at
the earliest and directed to submit a report  to  this  Court.   This  Court
also directed the CBI to submit Preliminary report  within  four  weeks  and
final report within two months from 16.07.2003.
12)   In the next order dated 21.08.2003, M.C  Mehta  vs.  Union  of  India,
(2003)  8  SCC  711,  this  Court,  after  going  through  the   Preliminary
Confidential Report submitted by the CBI, directed  the  higher  officer  of
CBI to interrogate four, five or six more persons who are  involved  in  the
decision-making of granting contract for construction of  the  Taj  Heritage
Corridor.  In the same order, this Court observed that it would be  open  to
the CBI officer to interrogate  and  verify  their  assets  because  it  was
alleged that Rs. 17 crores were released without proper sanction.
13)   The next order is dated 18.09.2003 - M.C. Mehta  vs.  Union  of  India
and Others, 2003 (8) SCC 696.  In this order, this  Court  referred  to  the
earlier directions and orders, more particularly, the direction  to  CBI  to
interrogate the persons involved and verify their  assets  in  view  of  the
fact that it was alleged that an  amount  of  Rs.  17  crores  was  released
without proper  sanction.   After  going  through  the  report  of  the  CBI
submitted on 11.09.2003, further time was given to the CBI for  verification
of the assets of the persons/officers involved.  In the course  of  hearing,
the CBI  has  pointed  out  that  income  tax  returns  of  various  persons
including  the  petitioner  were  collected  from   different   income   tax
authorities.  In the course of the  said  proceedings,  apart  from  various
reports with regard to the  assets,  the  learned  ASG  -  Mr.  Altaf  Ahmed
submitted that  further  inquiry/investigation  is  necessary  by  the  CBI.
Based on his request, this Court issued the following directions:
      “13.   Considering   the   aforesaid   report    and    the    serious
      irregularities/illegalities committed in carrying  out  the  so-called
      Taj Heritage Corridor Project, we direct:


      (a) the Central Government  to  hold  immediate  departmental  inquiry
      against Shri K.C. Mishra,  former  Secretary,  Environment,  Union  of
      India;


      (b) the State of Uttar Pradesh to hold  departmental  inquiry  against
      Shri R.K. Sharma, former Principal Environment  Secretary,  Shri  P.L.
      Punia, former Principal Secretary to Chief Minister, Shri D.S.  Bagga,
      Chief Secretary and Shri V.K. Gupta, former Secretary, Environment;


      (c) NPCC or the competent authority including the  Central  Government
      to hold inquiry against Shri S.C. Bali, Managing Director of NPCC;


      (d) the State Government as well as  the  officers  concerned  of  the
      Central Government are directed to see that  departmental  inquiry  is
      completed within four months from today. The State  of  U.P.  and  the
      Central Government  would  appoint  respective  inquiry  officers  for
      holding inquiry, within a period of seven days from today;


      (e) it would be open to the State Government if  called  for  to  pass
      order for suspension of the delinquent officers in accordance with the
      rules;


      (f) for the officers and the persons involved in the  matter,  CBI  is
      directed to lodge an FIR and make further investigation in  accordance
      with law;


      (g) CBI shall take appropriate steps for holding investigation against
      the Chief  Minister  Ms  Mayawati  and  Naseemuddin  Siddiqui,  former
      Minister for Environment, U.P. and other officers involved;


      (h) the Income Tax Department is also directed to cooperate in further
      investigation which is required to be carried out by CBI;


      (i) CBI would take into  consideration  all  the  relevant  Acts  i.e.
      IPC/Prevention of Corruption Act and the Water (Prevention and Control
      of Pollution) Act, 1974 etc.;


      (j) CBI to submit a self-contained note to the Chief Secretary to  the
      Government of Uttar Pradesh as well as to the Cabinet Secretary, Union
      Government and to the Ministry concerned dealing with NPCC.”


14)   A perusal of the orders  prior  to  the  order  dated  18.09.2003  and
several directions in the order dated  18.09.2003  clearly  show  that  this
Court  was  concerned  with   illegality/irregularity   committed   by   the
officers/persons in carrying out the Taj  Heritage  Corridor  Project.   The
main allegation relates to an amount of Rs. 17 crores which was released  by
the State Government without proper sanction.  It  is  also  clear  that  in
order to find out who cleared the  project  and  for  what  purpose  it  was
cleared without obtaining necessary sanction from the  Department  concerned
and  whether  there  was  any  illegality/irregularity  committed   by   the
officers/persons, this Court  thought  an  inquiry  by  CBI  was  considered
necessary.  In such a situation, the CBI was  directed  to  interrogate  and
verify their assets.  As rightly pointed out by Mr. Harish Salve, there  was
no occasion for this Court to consider the alleged  disproportionate  assets
of the petitioner separately that too from 1995 to 2003 when admittedly  Rs.
17 crores were released in September, 2002.
15)    A  thorough  scrutiny  of  all  the  orders  including  the  specific
directions dated 18.09.2003 clearly show that the same was confined only  in
respect to the case relating to Taj Corridor Project which was the  subject-
matter of reference before the Special Bench.  It is relevant to  point  out
para 13(f) of the order dated 18.09.2003 which makes it clear that  the  CBI
could have lodged only one FIR No. R.C. 0062003A0018 dated  05.10.2003.   In
other  words,  inasmuch  as  there  being  no   consideration   of   alleged
disproportionate assets at any stage of the proceedings while  dealing  with
the Taj Corridor matter, there could not have been and in fact there was  no
such direction to lodge  another  FIR  being  No.  R.C.  0062003A0019  dated
05.10.2003 exclusively against the petitioner under the P.C. Act.
16)   In this regard, learned senior  counsel  for  the  petitioner  pressed
into service a Constitution Bench decision rendered in the case of State  of
West Bengal & Ors. vs. Committee for Protection of Democratic  Rights,  West
Bengal & Ors., (2010) 3 SCC 571.  After considering  various  constitutional
provisions relating to the State and the Union as well as Section 6  of  the
DSPE Act, the Bench has concluded thus:
      “69. In the final analysis, our answer to  the  question  referred  is
      that a direction by the High Court, in exercise  of  its  jurisdiction
      under Article 226  of  the  Constitution,  to  CBI  to  investigate  a
      cognizable offence alleged to have been committed within the territory
      of a State without the consent of that State will neither impinge upon
      the federal structure of the Constitution nor violate the doctrine  of
      separation of power and shall be valid in law. Being the protectors of
      civil liberties of the citizens, this Court and the High  Courts  have
      not only the power and jurisdiction but also an obligation to  protect
      the fundamental rights, guaranteed by Part III in  general  and  under
      Article  21  of  the  Constitution  in   particular,   zealously   and
      vigilantly.


      70. Before parting with the case, we deem it  necessary  to  emphasise
      that despite wide powers conferred by  Articles  32  and  226  of  the
      Constitution, while passing any order, the Courts must  bear  in  mind
      certain  self-imposed   limitations   on   the   exercise   of   these
      constitutional powers. The very plenitude of the power under the  said
      articles requires great  caution  in  its  exercise.  Insofar  as  the
      question of issuing a direction to CBI to conduct investigation  in  a
      case is concerned, although no inflexible guidelines can be laid  down
      to decide whether or not such power should be exercised but  time  and
      again it has been reiterated that such an order is not to be passed as
      a matter of routine or  merely  because  a  party  has  levelled  some
      allegations against the local police. This extraordinary power must be
      exercised sparingly, cautiously and in exceptional situations where it
      becomes necessary to provide  credibility  and  instil  confidence  in
      investigations  or  where  the  incident   may   have   national   and
      international ramifications or where such an order  may  be  necessary
      for doing complete  justice  and  enforcing  the  fundamental  rights.
      Otherwise CBI would be flooded with a large number of cases  and  with
      limited resources, may find it difficult to properly investigate  even
      serious cases and in the process lose its credibility and purpose with
      unsatisfactory investigations.


      71. In Minor Irrigation & Rural Engg. Services, U.P.  v.  Sahngoo  Ram
      Arya this Court had said that an order directing  an  enquiry  by  CBI
      should be passed only when  the  High  Court,  after  considering  the
      material on record, comes to a  conclusion  that  such  material  does
      disclose a prima facie case calling for an investigation by CBI or any
      other similar agency. We respectfully concur with these observations.”


17)   As rightly pointed out that in the absence of any  direction  by  this
Court to lodge an FIR into the matter  of  alleged  disproportionate  assets
against the petitioner, the Investigating Officer could not take  resort  to
Section 157 of the Code of Criminal Procedure, 1973 (in  short  ‘the  Code’)
wherein the  Officer-in-charge  of  a  Police  Station  is  empowered  under
Section  156  of  the  Code  to  investigate  on  information  received   or
otherwise.  Section 6 of the DSPE Act prohibits the CBI from exercising  its
powers and jurisdiction without the consent of the Government of the  State.
 It is pointed out on the side of the petitioner that, in the present  case,
no such consent was obtained by the CBI and submitted that  the  second  FIR
against the petitioner is contrary to Section 157 of the Code and Section  6
of the DSPE Act. It is not in dispute that the consent was declined  by  the
Governor of the State and in such circumstance also the second FIR No.  R.C.
0062003A0019 dated 05.10.2003 is not sustainable.
18)   Mr. Mohan Parasaran, learned  ASG  as  well  as  Ms.  Kamini  Jaiswal,
learned counsel for the intervener after taking us through the  order  dated
18.09.2003 and other orders submitted that  the  CBI  was  well  within  its
power to pursue the second  FIR  No.  R.C.  0062003A0019  dated  05.10.2003.
Among various  directions,  Mr.  Mohan  Parasaran,  learned  ASG  very  much
pressed into service  the  direction  in  para  13(g)  of  the  order  dated
18.09.2003.  The said direction reads as under:-
      “(g) CBI  shall  take  appropriate  steps  for  holding  investigation
      against the Chief  Minister  Ms  Mayawati  and  Naseemuddin  Siddiqui,
      former Minister for Environment, U.P. and other officers involved;”

According to Mr. Mohan Parasaran, liberty  was  granted  by  this  Court  to
proceed against the petitioner.  He also relied  on  para  9  of  the  order
dated 25.10.2004 – M.C. Mehta vs. Union of India and Others,  (2007)  1  SCC
137, which reads as under:-
      “Re: FIR RC 0062003A0019


      9. The further investigation report filed by CBI  in  this  connection
      while indicating large-scale irregularities does not in fact show  any
      link between such irregularities and the Taj Corridor matter which  is
      the  subject-matter  of  reference  before  the  Special  Bench.   CBI
      therefore is at liberty to proceed with and take action on  the  basis
      of their investigation in respect of this FIR. In the event  any  link
      is disclosed in the course of  such  investigation  between  facts  as
      found and the Taj Corridor Project, CBI will bring  the  same  to  the
      notice of this Court. In any event,  CBI  will  be  entitled  to  take
      action on the basis of the investigation as it may think fit.”


In addition to the above, he also pressed into service para 4 of  the  order
dated 19.07.2004 – M.C. Mehta vs. Union of India and Others,  (2007)  1  SCC
136.  The said order reads as under: -
      “4. CBI is  permitted  further  eight  weeks’  time  to  complete  the
      investigation in respect of FIR No. RC 0062003A0018.  As  far  as  FIR
      No. RC 0062003A0019 is concerned, three months’ time is granted.”

In view of the argument of  Mr.  Mohan  Parasaran  as  well  as  Ms.  Kamini
Jaiswal relying on the above directions, we  have  gone  through  all  those
orders meticulously.  According to us, the entire issue revolves around  the
order  dated  18.09.2003  passed  by  this  Court  as  the  FIR  was   filed
immediately thereafter on 05.10.2003.  The said FIR as well as  the  counter
affidavit filed by the CBI states that the FIR has been  filed  as  per  the
directions contained in the order dated 18.09.2003.  A perusal of  the  same
shows that the Assistant Registrar of this Court has been described  as  the
Complainant.  On going through all the orders, we are of the view  that  the
said objection of the petitioner cannot  be  rejected.   A  perusal  of  the
series of orders passed in W.P. No. 13381 of 1984 - M.C. Mehta vs. Union  of
India and Others clearly show that the order dated  18.09.2003  is  preceded
by other orders issued from  time  to  time  only  in  connection  with  Taj
Heritage Corridor Project.  While considering the directions issued  in  the
order  dated  18.09.2003,  it  is  incumbent  to  refer  the  orders   dated
16.07.2003, 21.08.2003 and 11.09.2003.  We have  already  noted  that  those
previous three orders passed by this Court state that the CBI  was  directed
to interrogate the persons involved and also to verify their assets  because
it was alleged that the amount of Rs. 17 crores was released without  proper
sanction. It is relevant to mention  that  in  the  order  dated  25.10.2003
(which we have already quoted in the earlier  paras)  this  Court  mentioned
that it was not monitoring disproportionate assets case since no link  could
be found between the Taj Corridor matter and the assets of  the  petitioner.
(para 9 of the order dated 25.10.2004)  It is also  relevant  to  refer  the
next order dated 07.08.2006 wherein the same was once again  reiterated.  It
is true that in the order dated 25.10.2004, liberty was granted to  the  CBI
that in the event any link is disclosed in the course of such  investigation
between the Taj Corridor Project and the assets, CBI is free to bring it  to
the notice of this Court.  The fact remains that  the  investigation  report
filed by the CBI before this Court which was considered on 25.10.2004  shows
that  large-scale  irregularities  does  not  show  any  link  between  such
irregularities and the Taj Corridor matter.  The said finding/conclusion  by
this Court was based on the investigation report of the  CBI.   In  view  of
the same, we are satisfied that CBI cannot be permitted  to  take  the  view
that two cases, namely, Taj Corridor and Disproportionate  Assets  case  are
same and the investigation was done in both the cases as per the  directions
of this Court.   After  reading  the  entire  orders  dated  18.09.2003  and
25.10.2004, the stand of the CBI is to be rejected as unacceptable.
19)   It is also brought to our notice that merely  because  various  orders
of this Court including the order dated 18.09.2003 has been communicated  to
various authorities in terms of the provisions of the rules of  this  Court,
the CBI is not justified in putting the Assistant Registrar  of  this  Court
as informant/complainant.  Further as rightly pointed out by Mr. Salve,  the
complainant/Assistant Registrar would not and cannot be  a  witness  in  the
case to corroborate the statements made in the  FIR  No.  R.C.  0062003A0019
dated 05.10.2003.  As rightly pointed out, proceeding  further,  as  if  the
said  Assistant  Registrar  of  this  Court  made  a  complaint  cannot   be
sustained.
20)   We have already pointed out  after  reading  various  orders  of  this
Court which show that Taj Corridor  was  the  subject  matter  of  reference
before the Special Bench.  Various directions  issued  in  the  order  dated
18.09.2003 have to be read  in  the  light  of  the  previous  orders  dated
16.07.2003, 21.08.2003 and 11.09.2003 as well  as  subsequent  orders  dated
25.10.2004 and 07.08.2006 wherein this Court has clarified that it  was  not
monitoring the disproportionate assets case.  We are satisfied that  reading
of all the orders of this Court clearly show the direction to lodge FIR  was
issued  only  with  respect  to  Taj  Corridor  matter,  more  particularly,
irregularities therein.  In fact, the direction was confined to find out  as
to who cleared the project of Taj Corridor  and  for  what  purpose  it  was
cleared and whether there was any illegality or  irregularity  committed  by
officers and other persons concerned in the State.  We  have  already  noted
all those orders which clearly state that the CBI  is  free  to  interrogate
and verify the assets of the officers/persons relating to release of Rs.  17
crores in connection with Taj Corridor matter.
21)   As discussed above and after reading all  the  orders  of  this  Court
which are available in the ‘compilation’, we are satisfied that  this  Court
being the ultimate custodian of the fundamental rights  did  not  issue  any
direction to the CBI to conduct a roving inquiry against the assets  of  the
petitioner commencing from  1995  to  2003  even  though  the  Taj  Heritage
Corridor Project was conceived only in July, 2002 and an amount  of  Rs.  17
crores was released in August/September, 2002.  The method  adopted  by  the
CBI is unwarranted and without jurisdiction.  We  are  also  satisfied  that
the CBI has proceeded without proper understanding of various  orders  dated
16.07.2003, 21.08.2003, 18.09.2003,  25.10.2003  and  07.08.2003  passed  by
this Court.  We  are  also  satisfied  that  there  was  no  such  direction
relating to second FIR, namely, FIR No. R.C. 0062003A0019 dated  05.10.2003.
 We have already referred to the Constitution Bench decision of  this  Court
in Committee for  Protection  of  Democratic  Rights,  West  Bengal  (supra)
wherein this Court observed that only  when  this  Court  after  considering
material on record comes to a conclusion that such material does disclose  a
prima facie case calling for  investigation  by  the  CBI  for  the  alleged
offence, an order directing inquiry by the CBI could be passed and that  too
after giving  opportunity  of  hearing  to  the  affected  person.   We  are
satisfied that there was no such finding or satisfaction  recorded  by  this
Court in the matter of disproportionate assets  of  the  petitioner  on  the
basis of the status report dated 11.09.2003 and,  in  fact,  the  petitioner
was not a party before this  Court  in  the  case  in  question.   From  the
perusal of those orders, we are also satisfied that  there  could  not  have
been any material before this Court about the disproportionate  assets  case
of the petitioner beyond the Taj Corridor Project  case  and  there  was  no
such question or issue about disproportionate assets of the petitioner.   In
view  of  the  same,  giving  any  direction  to  lodge  FIR   relating   to
disproportionate assets case did not arise.
22)   We finally conclude that anything beyond the Taj Corridor  matter  was
not the subject-matter of reference before the Taj  Corridor  Bench.   Since
the  order  dated  18.09.2003  does  not  contain  any  specific   direction
regarding lodging of FIR in  the  matter  of  disproportionate  assets  case
against the petitioner, CBI is not justified in proceeding with the FIR  No.
R.C. 0062003A0019 dated 05.10.2003.  In view of  the  above  discussion,  we
are satisfied that the CBI exceeded its  jurisdiction  in  lodging  FIR  No.
R.C. 0062003A0019 dated 05.10.2003 in the  absence  of  any  direction  from
this Court in the order dated 18.09.2003 or in any subsequent orders.
23)   Regarding the intervention application - I.A. No. 8 of 2010  filed  by
Shri Kamlesh Verma, though an  objection  was  raised  about  his  right  to
intervene in the matter, it is not in dispute that against the rejection  of
the sanction to  proceed  against  the  petitioner  by  the  State,  he  had
preferred a Writ Petition (C) No. 2019 of 2009 in the Allahabad  High  Court
which is  still  pending.   It  is  pointed  out  that  intervener  was  not
associated with the Taj Corridor matter before this Court at any stage  when
the   orders   dated   16.07.2003,   21.08.2003,   11.09.2003,   18.09.2003,
19.07.2004, 25.10.2004, 07.08.2006, 27.11.2006, 06.08.2007,  10.10.2007  and
27.04.2007 were passed.  It is true that the intervener has no  legal  right
to intervene in the matter of this kind where CBI has been  prosecuting  the
case vigorously against the  petitioner.  Inasmuch  as  the  intervener  has
challenged the order of the Governor of U.P. declining to grant sanction  to
prosecute the petitioner and the said  matter  is  pending  in  the  Lucknow
Bench of the Allahabad High Court, in order to assist the  Court,  we  heard
his counsel Ms. Kamini Jaiswal.  It is true that this Court  has  held  that
when investigating agency like CBI and Union of  India  are  contesting  the
matter  effectively,  the  third  party  was  not   permitted   to   canvass
correctness of the judgment by way of PIL (Union of India &  Anr.  vs.  W.N.
Chadha, 1993 (Supp) 4 SCC 260) and Janata Dal vs.  H.S.  Chowdhary  &  Ors.,
(1991) 3 SCC 756.  While accepting the above principles reiterated in  those
decisions, in view of the peculiar  facts  that  the  intervener  -  Kamlesh
Verma is pursuing his writ petition  against  the  petitioner  in  the  High
Court, we heard his counsel to assist the  Court.   In  view  of  the  above
special circumstance, we allow I.A. No. 8 of 2010 and  the  same  cannot  be
cited as a precedent for other cases.
24)   In the light of the above discussion, we hold that in the  absence  of
any specific direction from this Court in the order dated 18.09.2003 or  any
subsequent orders, the CBI has exceeded its jurisdiction in lodging FIR  No.
R.C.  0062003A0019  dated  05.10.2003.   The   impugned   FIR   is   without
jurisdiction and any investigation pursuant thereto is  illegal  and  liable
to be quashed, accordingly quashed.  The writ petition is allowed.


                                  ………….…………………………J.


                                       (P. SATHASIVAM)












                                    ………….…………………………J.


                                      (DIPAK MISRA)


NEW DELHI;
JULY 6, 2012.
-----------------------
34


Thursday, July 5, 2012

In June/July 2007, The Ministry of Railways (Rail Mantralaya), Railway Board, approved the proposal submitted by the Indian Railway Catering & Tourism Corporation Ltd., hereinafter referred to as “IRCTC”, for operating a Luxury Tourist Train on a Pan-India route within India. Such proposal was made in pursuance of an Expression of Interest floated by the Respondent for a Joint Venture partner for the said Luxury Transit Train Project, to operate, manage and run the said train. The proposal was approved subject to certain broad principles for running the said train, set out by the Indian Railways in its letter dated 29th November, 2007, addressed to the Respondent, namely, “(a) The Respondent will own the rake; (b) The Respondent will pay to the Indian Railways the cost of maintenance and periodical overhaul of the rake; (c) Railways be entitled to recover the haulage cost; (d) The Respondent with their associate agencies will manage on board/off board services, marketing, booking, pricing, etc.” 2. The Petitioner came to be selected as the Joint Venture shareholder for the operation of the Luxury Tourist Train Project. On 11th January, 2008, the Respondent forwarded the draft Memorandum of Understanding, which was proposed to be executed between the Petitioner and the Respondent, to the Indian Railways. In terms of the said Memorandum of Understanding, the Petitioner and the Respondent would be equal shareholders of the Joint Venture Company and the project cost was estimated at Rs.37.5 crores, out of which an amount of Rs.7.5 was to be contributed by the Ministry of Tourism as a grant and an amount of Rs.15 crores was to be contributed as advance lease rental by the Petitioner as its share. In addition to the above, the Petitioner was to bring in the funding for the project and the Luxury Tourist Train was to be leased by the Respondent to the Joint Venture Company for a period of 15 years, which could be extended by another period of 10 years on conditions to be mutually agreed between the Petitioner and the Respondent. The Joint Venture Company was incorporated under the name and style of “Royale India Rail Tours Ltd.”. - the ownership of the train and it had been clearly understood by all concerned that it was IRCTC which was to be the owner of the train and that the Joint Venture Company was to be formed for management and operation of the train. It had also been made clear that IRCTC’s association with other agencies was for the purpose of management of the train only. 22. It is evident from the submissions made on behalf of the respective parties that the arrangement between the Respondent No.1, IRCTC, was with the Petitioner Company and, although, it was the intention of the parties by virtue of the Joint Venture Agreement that the luxury train, belonging to the Respondent No.1, was to be operated by the Joint Venture Company, at least for a minimum period of 15 years, what ultimately transpired was the termination of the Agreement by the Respondent No.1 in favour of the Joint Venture Company. As pointed out by the Division Bench of the High Court, the Petitioner was not entitled to question such termination as by itself it had no existence as far as the running of the train was concerned and it was not a party to the proceedings. In fact, what the Petitioner has attempted to do in these proceedings is to either restore the Lease Agreement, which had been terminated, or to create a fresh Agreement to enable the Petitioner to operate the luxury train indefinitely, till a decision was arrived at in Section 9 Application. 23. It is no doubt true that the Petitioner has invested large sums of money in the project, but that cannot entitle it to pray for and obtain a mandatory order of injunction to operate the train once the lease agreement/arrangement had been terminated. We are also unable to accept Mr. Rohatgi’s submission that the Joint Venture Agreement was akin to a partnership. Such submission had been rightly rejected by the Division Bench. As rightly pointed out by the Division Bench of the High Court, the Petitioner’s remedy, if any, would lie in an action for damages against IRCTC for breach of any of the terms and conditions of the Joint Venture Agreement and the Memorandum of Understanding. 24. Taking into consideration the totality of the circumstances, we are inclined to agree with the suggestions which had been made by IRCTC before the Division Bench of the High Court regarding the operation of the train by IRCTC, with liberty to the parties to appoint an Arbitral Tribunal to settle their disputes. We, therefore, dismiss the Special Leave Petitions, but make it clear that if an Arbitral Tribunal is appointed, the aforesaid arrangement will be subject to the decision of the Arbitral Tribunal. We also make it clear that the observations made by the learned Single Judge, the Division Bench of the High Court and by us, shall not, in any way, influence the outcome of the arbitral proceedings, if resorted to by the parties. 25. Having regard to the nature of the facts of the case, the parties shall bear their own costs. 26. In view of the above, no order is required to be passed on the Contempt Petitions and the same are also dismissed.


                               REPORTABLE | |

                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION

             SPECIAL LEAVE PETITION (CIVIL) NOS.965-967 OF 2012



Cox & Kings Ltd.                           … Petitioner


           Vs.



Indian Rly. Catering & Tourism


Corporation Ltd.& Anr.               … Respondents



                                    WITH

                 CONTEMPT PETITION (CIVIL) NOS.41-43 OF 2012
                                     IN
             SPECIAL LEAVE PETITION (CIVIL) NOS.965-967 OF 2012






                               J U D G M E N T



ALTAMAS KABIR, J.


1.     In June/July  2007,  The  Ministry  of  Railways  (Rail  Mantralaya),
Railway Board,  approved  the  proposal  submitted  by  the  Indian  Railway
Catering & Tourism Corporation Ltd., hereinafter  referred  to  as  “IRCTC”,
for operating a Luxury Tourist Train on  a  Pan-India  route  within  India.
Such proposal was made in pursuance of an Expression of Interest floated  by
the Respondent for a Joint Venture  partner  for  the  said  Luxury  Transit
Train Project, to operate, manage and run the said train. The  proposal  was
approved subject to certain broad principles for  running  the  said  train,
set out by the Indian Railways in its  letter  dated  29th  November,  2007,
addressed to the Respondent, namely,


      “(a)  The Respondent will own the rake;
       (b)  The Respondent will pay to  the  Indian  Railways  the  cost  of
               maintenance and periodical overhaul of the rake;
       (c)  Railways be entitled to recover the haulage cost;
       (d)  The Respondent with their  associate  agencies  will  manage  on
               board/off board services, marketing, booking, pricing,  etc.”



2.  The Petitioner came to be selected as the Joint Venture shareholder  for
the operation of the Luxury Tourist Train Project.  On 11th  January,  2008,
the Respondent forwarded the draft Memorandum of  Understanding,  which  was
proposed to be executed between the Petitioner and the  Respondent,  to  the
Indian Railways.  In terms of the  said  Memorandum  of  Understanding,  the
Petitioner and the Respondent would  be  equal  shareholders  of  the  Joint
Venture Company and the project cost was estimated at  Rs.37.5  crores,  out
of which an amount of Rs.7.5 was  to  be  contributed  by  the  Ministry  of
Tourism as a grant and an amount of Rs.15 crores was to  be  contributed  as
advance lease rental by the Petitioner as its share.   In  addition  to  the
above, the Petitioner was to bring in the funding for the  project  and  the
Luxury Tourist Train was to  be  leased  by  the  Respondent  to  the  Joint
Venture Company for a period  of  15  years,  which  could  be  extended  by
another period of 10 years on conditions to be mutually agreed  between  the
Petitioner and the Respondent.  The Joint Venture Company  was  incorporated
under the name and style of “Royale India Rail Tours Ltd.”.

3.    Upon receiving the approval of the  Indian  Railways,  the  Respondent
executed a Memorandum of Understanding with the Petitioner dated 10th  July,
2008, wherein it was stated that the Ministry  of  Railways  had  given  the
permission to the Respondent to own and operate  the  Luxury  Tourist  Train
for the exclusive use of the Joint  Venture  Company  for  a  period  of  15
years, which was renewable for a further  period  of  10  years.   The  said
Memorandum of Understanding also contained the various terms and  conditions
on which the train was to be  operated.   In  terms  of  the  Joint  Venture
Agreement and the Memorandum of Understanding,  a  Service  Agreement  dated
5th March, 2010, was executed between the  Joint  Venture  Company  and  the
Ninth Dimension Hotel and Resorts Pvt.  Ltd.,  hereinafter  referred  to  as
“MAPPLE Hotels”, for providing  hospitality  services  on  board  and  their
respective roles and responsibilities were set out in the said agreement.

4.    The Maharaja Express commenced operations on  20th  March,  2010,  and
completed 4 journeys in the inaugural runs till 31st  March,  2010,  and  30
journeys between April, 2010, till April, 2011.

5.    Whilst the Joint Venture  operations  were  being  conducted,  certain
disputes arose between the shareholders regarding the working of  the  Joint
Venture Agreement and the  Memorandum  of  Understanding,  which  ultimately
resulted in the termination of the  lease  arrangement  by  the  Respondent,
IRCTC, by its letter dated 12th  August,  2011,  on  the  grounds  indicated
therein.

6.    On account of such termination of the lease agreement, the  Petitioner
initiated a proceeding under Section 9 of the Arbitration  and  Conciliation
Act, 1996, under the Arbitration Agreement contained in Article  30  of  the
Joint Venture Agreement, for staying the termination of the lease  agreement
and also to allow the arrangements to continue  till  the  month  of  April,
2012, subject to such terms and conditions as may be imposed by the Court.

7.    As has been submitted by Mr. Mukul Rohatgi, learned  Senior  Advocate,
appearing for the Petitioner, what was of utmost importance and  concern  to
the Petitioner was not only the huge investment made by  the  Petitioner  in
the project, but the loss of goodwill and reputation  in  the  eyes  of  its
clients,  who  were  mainly  from  foreign  countries.   Discontinuance   of
operation would also besmirch the reputation of the Indian Government.

8.    One of the other concerns of the  Petitioner  was  that  it  had  been
looking after the marketing and  the  bookings  internationally  and  within
India and such bookings had been made much in advance.  It was the  case  of
the Petitioner that the Joint Venture Company had received and  was  holding
approximately 400 bookings up to December, 2011 and such bookings  had  been
made by various international travel companies.

9.    The prayer for interim directions was contested by the  Respondent  on
several grounds. One of the grounds taken was that by making relief  on  the
basis of the Joint Venture Agreement, the Petitioner was  trying  to  get  a
lease in favour of the Joint Venture Company, which was neither a  party  to
the proceedings nor to the Agreement.  It was  further  contended  that,  in
fact, the lease was never executed in favour of the  Joint  Venture  Company
and the rights of the Petitioner could not go  beyond  what  had  been  laid
down in the Articles of Association of the Joint Venture  Company.   It  was
also urged that since the relationship between  the  Joint  Venture  Company
and the Respondent had been terminated, the Petitioner was trying to  create
a right in its favour for operating  the  train,  which  was  never  in  its
individual  possession.   It  was  urged  that  such  a   prayer   was   not
maintainable and it was not open to the Petitioner to claim  any  relief  in
relation to the train, which was  the  subject  matter  of  the  termination
letters issued by the Respondent  to  the  Joint  Venture  Company,  in  its
capacity as owner of the train.  Noting the  interest  of  the  parties  and
keeping in mind the fact that advance bookings had been  made,  the  learned
Single Judge of the Delhi  High  Court,  who  heard  the  Application  under
Section 9 of the  Arbitration  and  Conciliation  Act,  1996,  came  to  the
conclusion that, although, in terms of the Joint Venture Agreement in  which
there was a separate provision for arbitration, the arbitral  dispute  would
have to be confined to the disputes between the parties  to  the  Agreement,
under the wider connotation of the Agreement between the Respondent and  the
Joint Venture Company, certain interim orders  were  required  to  be  made.
More so, when the main grievance of the Respondent  against  the  Petitioner
and the Joint Venture Company was in respect of  inflated  bills  raised  by
the Petitioner and non-payment of  the  amounts  payable  in  terms  of  the
Agreement.  In such circumstances, the learned Single Judge found it fit  to
appoint a Receiver, as an  interim  measure,  in  the  public  interest,  to
prevent discontinuation of the running of the train for which  bookings  had
already been made.  The learned Judge appointed one Shri  Sudhir  Nandrajog,
a Senior Advocate of the Delhi High Court, as Receiver, and disposed of  the
Section 9 application,  inter  alia,  by  directing  that  the  train  would
continue to be run under the supervision of the  learned  Receiver  for  the
period commencing from 14th September,  2011,  uptil  31st  December,  2011,
which was the major period for which the bookings had been effected, as  per
the arrangement which was continuing  during  the  earlier  season.  Various
other directions were given to enable the learned Receiver  to  operate  the
Maharaja Express and for maintenance of  accounts.  The  parties  were  also
granted leave to  approach  the  Court  or  Arbitrator  (if  appointed)  for
modification of the order in case such need arose.

10.   In addition to the above, the parties were also given liberty to  take
necessary steps to have their disputes resolved by  the  appointment  of  an
Arbitral Tribunal which would be at liberty to decide the  disputes  without
being influenced by the order passed on the application under Section  9  of
the 1996 Act.  The rights and contentions of both sides were also kept  open
for submission before the Arbitral Tribunal, if appointed.

11.   The order of the learned Single Judge was challenged by IRCTC Ltd.  by
way of FAO(OS)Nos.433-35 of 2011.

12.   The submissions made before the learned Single Judge  were  reiterated
on behalf of  both  the  parties  before  the  Division  Bench,  but  a  new
dimension was attempted to be added to the submissions  advanced  on  behalf
of the Petitioner, M/s Cox & Kings India Ltd.  An attempt was made  to  make
out a case that the Joint Venture Company was akin to a partnership and  the
train in question was partnership property.  The Division  Bench  took  note
of the fact that the total cost of the train was Rs.49.5 crores,  which  had
been borne by IRCTC and was even recorded in Article  6  of  the  Agreement.
Apart from the above, not only the shell train, but even  the  cost  of  the
interior, fittings and furnishing was borne by IRCTC.   The  Division  Bench
also noted that if  the  train  was  to  be  regarded  as  a  Joint  Venture
property, there was no reason to provide for leasing of the train  by  IRCTC
to the Joint Venture Company.

13.    The  Division  Bench,  however,  was  disinclined  to  continue   the
arrangement, as directed by the  learned  Single  Judge,  and  accepted  the
submissions made on behalf of the IRCTC that the mandatory injunction  which
had been passed, would have the effect of creating an Agreement between  the
Joint Venture Company and IRCTC in relation to the  train,  which  would  be
influenced even though the Joint Venture Company was  not  a  party  to  the
proceedings.  However, keeping in  mind  the  prestige  of  the  country  in
regard to the running of the Maharaja Express  which  had  earned  worldwide
fame, the Division Bench felt that since the Court was not in a position  to
restore the terminated arrangement and direct the train to  be  managed  and
run by M/s. Cox & Kings under the supervision of the  Receiver,  the  public
interest could  be  subserved  if  the  Maharaja  Express  continued  to  be
operated even by the IRCTC.  Also taking into account  the  factor  relating
to the bookings which had already been made in advance, the  Division  Bench
accepted the suggestions made by  IRCTC  to  honour  the  bookings,  without
prejudice to the  rights  and  contentions  of  the  parties,  as  extracted
hereinbelow :

      “a)   The train has to  be  run  by  the  owner/respondent.   All  the
           facility material including crockery,  furnish-ings  etc.  which
           are in custody of  the  petitioner  should  be  handed  over  to
           respondent for executing this facility arrangement.


      b)    All revenues arising therefrom  without  any  deductions  earned
           either by the petitioner or respondent may be deposited  in  the
           separate account from which expenditure will be funded.


      c)    All the bookings  may  be  allowed  to  be  transferred  to  the
           respondents for honouring.


      d)    All the on board or off board expenses and railway payments  may
           be allowed to be charged to this  account.   In  this  way,  the
           amount will be sufficient to cover the expenses and  there  will
           be no need for further loans.


      e)    The existing service providers may be retained.”

14.   The Division Bench also directed that while  running  the  train,  the
IRCTC would remain bound by the  aforesaid  suggestions.  Whatever  bookings
had been made till then could be transferred by M/s. Cox & Kings  to  IRCTC.
The Division Bench accordingly  set  aside  the  arrangements  made  by  the
learned Single and allowed the appeal preferred by the Respondent herein.

15.   It is against the said judgment  and  order  passed  by  the  Division
Bench of the Delhi High Court on 6th January, 2012 in  FAO(OS)Nos.433-35  of
2011, that the present Special Leave Petitions have been filed by  M/s.  Cox
& Kings India Ltd.

16.   Appearing for the  Petitioner  Company,  Mr.  Mukul  Rohatgi,  learned
Senior Advocate, submitted that the primary reason for filing  of  the  writ
petition was to protect and save the image and goodwill  of  the  Petitioner
Company in the field of global tourism.  Mr. Rohtagi submitted  that  it  is
in that context that a prayer had been made  on  behalf  of  the  Petitioner
Company for stay of operation of the termination of  the  Lease  Arrangement
by the Respondent IRCTC by its letter dated 12th August, 2012.  Mr.  Rohatgi
submitted that almost the  entire  expenses  for  commencing  operations  in
respect of the Maharaja Express had been borne by the Petitioner Company  in
different forms, and in view of the promises contained in the Memorandum  of
Understanding and the Agreement executed between the Petitioner Company  and
the Joint Venture Company, the termination of the Lease Arrangement was  not
warranted.

17.   Mr. Rohatgi urged that it had been agreed by both the parties  in  the
said Memorandum of Understanding and the Joint Venture Agreement  and  other
supporting documents that the lease of the  train  by  IRCTC  to  the  Joint
Venture Company was for a minimum period of 15 years from the  date  of  the
first commercial run of the train and in lieu whereof 50% cost of the  train
had been paid by way of advance lease charges  which  were  to  be  adjusted
over a period of 15 years from the date of the first commercial run  of  the
train.  Mr. Rohatgi urged  that  the  said  amount  had  been  paid  by  the
Petitioner to the IRCTC through  the  Joint  Venture  Company.   It  was  on
account of the termination letters dated 12th August, 2011, issued by  IRCTC
that the Petitioner Company was compelled  to  initiate  proceedings  before
the High Court under Section 9 of  the  Arbitration  and  Conciliation  Act,
1996. Mr. Rohatgi submitted that the relief claimed in the said  application
was that the Maharaja Express should be  operated  only  through  the  Joint
Venture Company and that the Respondent  IRCTC  should  be  restrained  from
using the train for any purpose other than for  the  exclusive  use  of  the
Joint Venture Company.  Mr. Rohatgi also reiterated the fact that  in  order
to safeguard the interest of  the  parties  concerned,  the  learned  Single
Judge had appointed a Receiver to oversee the  function  and  operations  of
the train and granted injunction to preserve the  existing  status-quo  till
the final hearing of the dispute.

18.   The  major  thrust  of  Mr.  Rohatgi’s  submissions  was  towards  the
aforesaid end and was indicative of the fact that the running of  the  train
was of primary importance and should be  allowed  to  continue  as  per  the
earlier undertaking, without any disturbance, while the disputes before  the
learned Arbitrator were finally disposed of.

19.   On the other hand, on behalf of the Respondent No.1 it  was  contended
by the Learned Solicitor General that the Special Leave Petitions  had  been
filed by M/s. Cox & Kings. Ltd. in respect of the train, which was owned  by
the Respondent No.1, IRCTC.  The  said  train  had  been  converted  into  a
luxury train and was being operated on a seasonal basis between  the  months
of September to April by the Joint Venture Company.  However, the IRCTC  had
no option but to terminate the  arrangement  made  with  the  Joint  Venture
Company to operate the luxury train on account of various  reasons  and,  in
particular, on account of non-payment of the  dues  of  IRCTC.  The  learned
Solicitor General submitted that the letter terminating  the  Joint  Venture
Agreement was the subject matter of the Section  9  Application  before  the
learned Single Judge of  the  High  Court,  who,  by  his  order  dated  6th
September, 2011, allowed the prayers made  therein  in  part  and  issued  a
mandatory injunction and also appointed a Receiver for  operation  of  train
between the months of September to December, 2011.  However, the  train  was
never operated under the Receiver on account of the  interim  orders  passed
in the appeal on 9th September, 2011.

20.   The  learned  Solicitor  General  reiterated  the  fact  that  on  6th
January, 2012, the Division Bench set aside the order passed by the  learned
Single Judge which was, in any event, to operate only  till  31st  December,
2011.

21.   The learned Solicitor  General  urged  that  there  was  no  ambiguity
regarding the ownership of the train and it had been clearly  understood  by
all concerned that it was IRCTC which was to be the owner of the  train  and
that the  Joint  Venture  Company  was  to  be  formed  for  management  and
operation  of  the  train.  It  had  also  been  made  clear  that   IRCTC’s
association with other agencies was for the purpose  of  management  of  the
train only.

22.   It is evident from the submissions made on behalf  of  the  respective
parties that the arrangement between the Respondent No.1,  IRCTC,  was  with
the Petitioner Company and, although, it was the intention  of  the  parties
by virtue of the Joint Venture Agreement that the  luxury  train,  belonging
to the Respondent No.1, was to be operated by the Joint Venture Company,  at
least for a minimum period of 15 years, what ultimately transpired  was  the
termination of the Agreement by the Respondent No.1 in favour of  the  Joint
Venture Company.  As pointed out by the Division Bench of  the  High  Court,
the Petitioner was not entitled to question such termination  as  by  itself
it had no existence as far as the running of the train was concerned and  it
was not a party to the  proceedings.   In  fact,  what  the  Petitioner  has
attempted to do  in  these  proceedings  is  to  either  restore  the  Lease
Agreement, which had been terminated, or to  create  a  fresh  Agreement  to
enable the Petitioner to operate  the  luxury  train  indefinitely,  till  a
decision was arrived at in Section 9 Application.

23.   It is no doubt true that the Petitioner has  invested  large  sums  of
money in the project, but that cannot entitle it to pray for  and  obtain  a
mandatory  order  of  injunction  to  operate  the  train  once  the   lease
agreement/arrangement had been terminated.  We are  also  unable  to  accept
Mr. Rohatgi’s submission that the Joint Venture  Agreement  was  akin  to  a
partnership. Such submission had  been  rightly  rejected  by  the  Division
Bench. As rightly pointed out by the Division Bench of the High  Court,  the
Petitioner’s remedy, if any, would lie in  an  action  for  damages  against
IRCTC for breach of any of the terms and conditions  of  the  Joint  Venture
Agreement and the Memorandum of Understanding.

24.   Taking into consideration the totality of the  circumstances,  we  are
inclined to agree with the suggestions which had been made by  IRCTC  before
the Division Bench of the High Court regarding the operation  of  the  train
by IRCTC, with liberty to the parties to appoint  an  Arbitral  Tribunal  to
settle their disputes.  We, therefore, dismiss the Special Leave  Petitions,
but make it clear that if an Arbitral Tribunal is appointed,  the  aforesaid
arrangement will be subject to the decision of the  Arbitral  Tribunal.   We
also make it clear that the observations made by the learned  Single  Judge,
the Division Bench of the High Court and by  us,  shall  not,  in  any  way,
influence the outcome of the arbitral proceedings, if  resorted  to  by  the
parties.

25.   Having regard to the nature of the facts  of  the  case,  the  parties
shall bear their own costs.

26.   In view of the above, no  order  is  required  to  be  passed  on  the
Contempt Petitions and the same are also dismissed.



                                                     ………………………………………………………J.
                                     (ALTAMAS KABIR)




                                                     ………………………………………………………J.
                                     (J. CHELAMESWAR)
New Delhi
Dated : 5.7.2012