Nanak Chand And Another vs. Nhai And Others

Held

The Court held that there was no concluded contract between Respondent No. 1 (NHAI) and Respondent No. 3 (Municipal Council, Manali) for the handing over of the parking lots. Consequently, Respondent No. 3 lacked the authority to outsource the collection of parking fees for parking places belonging to NHAI. The Court found that the petitioners had no enforceable cause of action or right against NHAI and were, in fact, trespassers over NHAI's property. The Court relied on principles of contract law, specifically the requirements of offer, acceptance, and the necessity of a meeting of minds (ad idem) for a valid agreement, citing provisions of the Indian Contract Act, 1872, and Supreme Court judgments. The Court directed the petitioners to hand over peaceful and vacant possession of the parking lots to NHAI by September 30, 2024. Respondent No. 3 was directed to deposit the collected parking fees, after deducting actual expenses, into NHAI's accounts within the same timeframe. The Court reserved liberty for the petitioners to approach the competent authority or court for recovery of their amount from Respondent No. 3. No issue was expressly left undecided.

Facts

The petitioners were allotted two parking lots by Respondent No. 3, the Municipal Council, Manali, for collection of parking fees. They deposited substantial amounts, including 18% GST, for this allotment. Subsequently, Respondent No. 1, the National Highway Authority of India (NHAI), issued a notice for removal of encroachment on the highway, identifying the parking lots as encroached land. NHAI officials attempted to demolish the parking lots, leading the petitioners to file civil suits which were dismissed as not maintainable. The petitioners then filed the present writ petition seeking quashing of the demolition notice and permission to continue collecting parking fees until June 2025. NHAI contended that the land was acquired for highway construction and was registered in the name of the Government of India, and that no formal agreement or MOU was signed with the Municipal Council for handing over the parking lots.

Key Issues

1. Whether Respondent No. 3, the Municipal Council, Manali, had the authority to allot parking lots belonging to Respondent No. 1, the National Highway Authority of India (NHAI), to the petitioners, considering the absence of a concluded contract or MOU between NHAI and the Municipal Council for such an arrangement? (Question of law turning on principles of contract law and authority of statutory bodies). 2. Whether the petitioners have an enforceable cause of action or right against NHAI for the collection of parking fees based on the allotment by the Municipal Council? (Question of law turning on contractual rights and property rights). Arguments for Petitioners: The petitioners argued that they had deposited lease money and were granted the lease by Respondent No. 3 up to June 2025. They sought permission to retain possession or an opportunity to recover their deposited amount from Respondent No. 3. They relied on the allotment letter and their deposit of fees, including GST. Arguments for Respondents: NHAI argued that the land in question was acquired for highway construction and registered in the name of the Government of India. They contended that no MOU was signed with the Municipal Council for handing over the suit land, and therefore, the Municipal Council had no authority to outsource the collection of parking fees. NHAI asserted that the petitioners were encroachers on government land and had no enforceable right against NHAI. They relied on the Control of National Highway (Land and Traffic) Act, 2002, and principles of contract law regarding offer and acceptance.