V. Ramesh Yadav vs. Telangana State Road Transport Corporation

Facts

The petitioner, V. Ramesh Yadav, a license holder of Stall No. 31 at MGBS, Hyderabad, was granted a license for a supermarket for five years from November 17, 2022, to November 16, 2027, with a monthly license fee of Rs. 4,15,500, later enhanced to Rs. 5,50,000 including GST. The 2nd respondent, the Regional Manager, TSRTC, terminated the petitioner's license on April 2, 2025, alleging the sale of unauthorized items. Subsequently, on April 16, 2025, the 2nd respondent revoked the termination order but imposed a condition requiring the petitioner to pay all license fee dues, including for the period from termination until the stall reopened. The petitioner challenged this condition, arguing it was arbitrary and illegal, while the respondents contended it was in line with a corporation circular.

Held

The Court held that the condition imposed in the revocation order was not illegal or arbitrary. The Court found that the petitioner himself admitted to selling unauthorized items and encroaching space in his representation dated April 2, 2025. The Court also noted that Corporation Circular No. 5/2022-OPD(M&C) dated March 15, 2022, which was relied upon by the respondents, was applicable. The Court observed that this circular deals with revocation for violations of terms and conditions of the agreement, not just for default in license fee payment. Furthermore, the circular was incorporated into the license agreement dated December 28, 2022, making it binding on the parties. Therefore, the petitioner's contention that the circular was not applicable was unsustainable. The Court confirmed the revocation order dated April 16, 2025, but to balance equities, granted the petitioner time to pay the dues. The petitioner was directed to file an undertaking to repay the dues in six equal monthly installments, commencing from May 2025. The petitioner was also directed to pay the admitted dues for February and March 2025 in the same installments. For recovery of any remaining amount, the respondents were at liberty to follow due process of law.

Key Issues

1. Whether the condition imposed by the 2nd respondent in the revocation order dated April 16, 2025, requiring the petitioner to pay license fee dues for the interregnum period (from termination to reopening) is illegal, arbitrary, and contrary to the terms of the license agreement. The petitioner argued that the condition was unwarranted, capricious, unjust, arbitrary, illegal, and unsustainable, violating Articles 14 and 21 of the Constitution. They contended that the termination was for selling unauthorized items, and the revocation should have been absolute. The petitioner also argued that Clause 28 of the license deed, which outlines the procedure for recovering dues, requires a one-month notice, which was not served. They asserted that dues should be dealt with separately and not linked to the revocation order. The respondents argued that the petitioner had not paid the full license fee since November 2022, accumulating dues of Rs. 19,99,665. They stated that the revocation order was passed considering the petitioner's explanation and assurance not to repeat the offense. The condition was imposed in accordance with Corporation Circular No. 5/2022-OPD(M&C) dated March 15, 2022, which permits revocation subject to payment of all accrued dues with interest and license fee for the interregnum period. They also pointed out that the petitioner admitted selling unauthorized items and encroaching space.