Skip to main content

Public interest or change in policy may be sufficient to negate concept of legitimate expectation

In Quippo Oil and Gas Infrastructure Ltd. v. Oil and Natural Gas Corporation Limited and Ors., the Delhi High Court said that in Ram Parvesh Singh & Ors v. State of Bihar and Ors. it was held that, legitimate expectation is not a legal right. It is an expectation of a benefit, relief or remedy, that may ordinarily flow from a promise or established practice. Term 'established practice' refers to a regular, consistent predictable and certain conduct, process or activity of decision-making authority. Expectation should be legitimate, that is, reasonable, logical and valid. Any expectation which is based on sporadic or casual or random acts, or which is unreasonable, illogical or invalid cannot be a legitimate expectation. Not being a right, it is not enforceable as such.

Public interest or change in policy may be sufficient to negate concept of legitimate expectation. Thus, if ONGC had decided that, a subsidiary company applying for tender should have a positive networth, it rather safeguarded compliance of project and hence, acted in public interest. Employer's interest is always in completion of its project rather than to secure financial guarantees for such project.

In present case, condition that, a bidder should have positive net worth was not imposed mid course; it always existed. That Petitioner's bids were accepted and evaluated in past, ignoring such a condition, does not in any manner make it inessential for present tender. As to its premise, Court is not equipped to discern the rationale. Perhaps, it is not enough for public agency to be satisfied that, any possible default can be financially addressed through a guarantee issued by principal or holding company and that alone may not be sufficient. It may wish to safeguard against insolvent contractors, whose lack of lines of credit may imperil smooth performance of contract, or worse - such as seizure or attachment of movable assets onsite. Therefore, insistence on such conditions cannot be belittled, nor can legitimate expectation be pressed into service as an actionable ground.

Comments

Post a Comment

Most viewed this month

Appellate authorities under Special Statutes cannot be asked to condone delay

Madras High Court in R.Gowrishankar vs. The Commissioner of Service Tax has held that Appellate authorities cannot be asked to condone the delay, beyond the extended period of limitation A Division Bench comprising of Justices S. Manikumar and D. Krishnakumar, made this observation while considering an appeal filed against Single Bench order declining to set aside the order made in the condone delay petition filed by the petitioner to condone 223 days in filing the appeal before the Commissioner of Service Tax (Appeals). Article referred: http://www.livelaw.in/appellate-authorities-special-statutes-cannot-asked-condone-delay-beyond-extended-period-limitation-madras-hc/
Post a Comment
Read more

'Seize assets to pay damages to accident victim'

Her story might be an inspiration for the physically challenged but justice has remained elusive for her. In 2008, a bus accident left research engineer S Thenmozhi, 30, paraplegic. In April 2013, the motor accident claims tribunal directed the Tamil Nadu State Transport Corporation (TNSTC) to provide her a compensation of 57.9 lakh. However, TNSTC refused to budge and on Tuesday a city court ordered attaching of movable assets of the transport corporation. Thenmozhi was employed in C-DOT, a telecom technology development centre in Bangalore. On July 21, 2008, she was coming to Chennai in a private bus. Around 2am, the bus had a flat tyre and the driver parked it on the left side of the road near Pallikonda in Vellore district on the Bangalore-Chennai highway. While the tyre was being changed, a TNSTC bus of Dharmapuri division hit the stationary bus. The rear part of the bus was smashed and passengers were injured. Thenmozhi who had a seat at the back of the bus suffered...
Post a Comment
Read more

Mumbai ITAT rules income of offshore discretionary trust is subject to tax in India

The Mumbai Income Tax Appellate Tribunal (ITAT) has recently determined the following issue in the affirmative in the case of Manoj Dhupelia: Should the income of an offshore discretionary trust be subject to tax in India, if no distributions have been made to beneficiaries in India? The question arose from appeals filed by individual beneficiaries in relation to a Lichtenstein-based trust, the Ambrunova Trust and Merlyn Management SA (the Trust) with the ITAT. It is important to note that the individuals in this case were amongst those first identified by the Government of India (GOI) as holding undeclared bank accounts in Lichtenstein. The ITAT ruling raises the following issues: Taxation of Trust Corpus: ITAT classified the corpus of the trust as "undisclosed income" and declared it taxable in the hands of the beneficiaries. Taxation of Undistributed Income: ITAT refused to draw a distinction between the corpus and undistributed income from the trust and declared i...
Post a Comment
Read more