Delhi High Court
Global Services vs Indraprastha Gas Limited & Anr on 30 April, 2026
Author: Sachin Datta
Bench: Sachin Datta
$~J
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment pronounced on: 30.04.2026
+ W.P.(C) 7184/2023, CM APPLs.27969/2023, 58654/2023,
68502/2024 & 73233/2025
GLOBAL SERVICES .....Petitioner
Through: Mr. Tanmay Mehta, Mr. Ankit Siwach
and Ms. Soumya Sannidhanam,
Advocates.
versus
INDRAPRASTHA GAS LIMITED & ANR. .....Respondents
Through: Mr. Prashant Mehta, Ms. Divye
Chugh, Ms. Prachi Kohli, Ms. Priya
Wadhwa, Advocates for R-1.
CORAM:
HON'BLE MR. JUSTICE SACHIN DATTA
JUDGMENT
1. The present petition has been filed by the petitioner assailing a
letter/communication dated 11.05.2023 issued by respondent
no.1/Indraprastha Gas Limited, whereby, the respondent no.1 formally ceased
all relationships with the petitioner which existed in terms of a Letter of Intent
dated 21.01.2020 (hereinafter referred as ” the LOI”). In terms of the LOI, the
petitioner was appointed/engaged as a ‘facilitator’ for facilitating
development of respondent no.1’s CNG facility site situated at Minto Road,
Delhi.
2. The petitioner also seeks that the respondent no.1 be directed to execute
a dealership agreement qua the concerned facility in its favour and further
restrain the said respondent from engaging/appointing any other
operator/third party rights thereof.
Signature Not Verified
Digitally Signed
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By:CHINU LUTHRA
Signing Date:30.04.2026
17:50:06
3. Vide a Note of Approval dated 10.06.2019, Company Owned, Dealer
Operated (CODO) Model was introduced by the respondent no.1. Under the
said model respondent no.1 inter-alia proposed to engage
agencies/individuals willing to resolve dispute/s of respondent no.1 with the
locals concerning lands which although already allotted to respondent no.1
for commissioning CNG facility/station, remained non-operational for over 6
months due to the said disputes. The relevant portion of the said Note of
Approval reads as under:-
“This policy would also be applicable for lands which have
already been allotted to IGL but are not operational for more than
6 months after allotment due to dispute. Any individual/agency
offering to solve the problem put the station to operation will be
awarded dealership for a limited period of 10 years at the
discretion of management on recommendation of the panel.
At present following are the sites which are under possession of
IGL but work has not commenced or being hindered due to
disputes:
1) Minto Road – The site at Minto Road was allotted to IGL on
20th August, 2008 from land and Development Office. The
possession of same was taken on 18th November, 2008 (Copy of
same attached as Annexure – B). Since the time of possession the
site was encroached by local slum dwellers. Various attempts of
eviction were made but IGL was not successful. Accordingly, IGL
took the matter to Hon’ble Delhi High court and the judgement
was given in favour of IGL. Subsequently, after various attempts
the site was evicted on 11.02.2019 with the help of Officials of
Delhi Police and Delhi Urban Shelter Improvement Board
(DUSIB).
However, when the construction started the anti-social elements
from the local area have been disturbing the work time and again.
IGL has not been able to work at the site properly due to such
disturbances.
Signature Not Verified
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By:CHINU LUTHRA
Signing Date:30.04.2026
17:50:06
It is proposed to appoint a consultant for the Minto Road Site who
can resolve the matter and enable IGL to construct the CNG
Station. The advertisement would be on IGL website for a period
of 15 days. If the consultant is successful and IGL is able to
construct the CNG Station, the consultant would be appointed as
a dealer.
2)Mangolpuri – The site at Mangolpuri was allotted to IGL on
30th August, 2017 from DUSIB Development Office. The
possession of same was taken on 06thOctober, 2017 (Copy of same
attached as Annexure – C). Since the time of possession IGL has
been trying to commence the work at site. However, each time the
construction activity has commenced at the site, the local
residents have not allowed the construction to take place.
This site was previously allotted in the same park but on the
opposite side in December 2009. At that time also the work could
not take place due to the residents and the site was relocated to
this side of the park.
It is proposed to appoint a consultant for the Mangolpuri Site who
can resolve the matter and enable IGL to construct the CNG
Station. The advertisement would be on IGL website for a period
of 15 days. If the consultant is successful and IGL is able to
construct the CNG Station, the consultant would be appointed as
a dealer.
Recommendation: Approval is initiated for advertising for
requirement of consultant for the 19 above mentioned
stretches/lands, Mangolpuri and Minto Road. The advertisement
would be put up on IGL’s Website as approved in the policy. If the
applicant is found suitable and allots the land in favour of IGL,
would be appointed as a dealer for the respective site.
Financial Implications: At present financial implication is nil,
however, on finalization of land and dealer we may take approval
from Competent Authority.
Approving Authority: Managing Director and Director
Commercial”
Signature Not Verified
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By:CHINU LUTHRA
Signing Date:30.04.2026
17:50:06
4. Pursuant thereto, the respondent no.1 issued an Expression of Interest
(EOI) dated 03.07.2019, inviting agencies and entrepreneurs who could
support respondent no.1 in amicably resolving the aforementioned disputes
and assist in commissioning of the said facility. The said EOI reads as under:-
Signature Not Verified
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By:CHINU LUTHRA
Signing Date:30.04.2026
17:50:06
5. The petitioner participated in the aforesaid process, seeking to be
appointed as a facilitator for the site situated at Minto Road, Delhi, allotted by
the L&DO/respondent no.2 to the respondent no.1.Subsequently, respondent
no.1 issued a Letter of Intent dated 16.01.2020 directing as under:-
6. Pursuant thereto, respondent no.1 issued LOI dated 21.01.2020 and
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By:CHINU LUTHRA
Signing Date:30.04.2026
17:50:06
appointed the petitioner as a ‘facilitator’ in respect of the concerned site for
the purpose of obtaining statutory clearances and operationalization of the
CNG Station therein. The LOI reads as under:-
“IGL/PLNG/CODO-G/Existing/2.1
21 JAN 2020
M/S Global Services
1 Alsons Colonels Corner Airport Road
Near Asharam Chouraha, Gandhi Nagar,
Huzur, Bhopal, Madhya Pradesh-462036Subject: – Your application for appointment as facilitator at IGL Existing
site Minto Road.
Dear Sir/Madam,
This is in reference to your application dated 19th July 2019 for existing
IGL site at Minto Road allotted from L&DO in favour of IGL.
We are pleased to inform you that we are appointing you as facilitator for
the subject site for getting all the statutory clearances and for making the
CNG station operational.
Thanking you,
Yours Faithfully,
Sd/-
Pavneet Singh Batra
GM (BD & CNG Projects)”
7. The scope of work appended along with the LOI inter-alia stipulated
that (i) the said engagement was valid for a period of 6 months, extendable for
a period of another 6 months (3+3) with approval of the concerned authority
(subject to the progress of the case the work) and to be completed within a
period of 12 months from the date of issuance of the letter (ii) the petitioner
would be awarded the operatorship of the concerned CNG facility for a period
of 10 years (5+5) by the respondent no.1, at the discretion of the management.
The relevant portion of the scope of work reads as under: –
“The applicant would be awarded the operatorship for a limited period of
Signature Not Verified
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By:CHINU LUTHRA
Signing Date:30.04.2026
17:50:06
10 years (5+5) at the discretion of management.
Note: Valid documentation/reference/recommendation/record from
facilitator shall be submitted showing his/her efforts for the said land
allotment from the land owning agency for being eligible for operatorship.
The validation of engagement as a facilitator is for 06 months. The same
may be extended for a period of 06 months (03+03) depending on the
progress of the case after approval from competent authority. No further
extension would be given after completion of 12 months from the date of
issue of this letter.”
8. The petitioner asserts that the respondent no.1 ought to have executed
the operatorship agreement in favour of the petitioner since as a ‘facilitator’
the petitioner fulfilled its mandate of commissioning the concerned CNG
station well within the stipulated timeline and inaugurated the concerned site
on 18.08.2020 in presence of the officials of respondent no.1.
9. However, the said position has been vehemently refuted by the
respondent no.1. It is contended that failure of the petitioner to commission
the concerned CNG station in terms of the LOI, impelled the respondent no.1
to issue a show-cause notice dated 06.10.2022 against the petitioner. The said
show-cause notice reads as under:-
NOTICE TO SHOW CAUSE
Date : 06.10.2022
To,
M/s Global Services
1, Alsons Colonels Corner Airport Road
Near Ashram Chouraha, Gandhi Nagar
Hazur, Bhopal – 462036
Madhya PradeshReference: Letter of Intent dated 21.01.2020 appointing M/s Global
Services as Facilitator of Minto Road SiteSubject: Notice to show cause why the Letter of Intent dated 21.01.2020
should not be terminated by IGLDear Sir/Madam,
Signature Not Verified
Digitally Signed
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By:CHINU LUTHRA
Signing Date:30.04.2026
17:50:06
We are writing in reference to your appointment as Facilitator pursuant to
the captioned Letter of Intent dated 21.01.2020 for the Minto Road site of
Indraprashta Gas Limited (“IGL”) for getting all the statutory clearances
and for making the CNG Station operational. Please take note that the
arrangement between IGL and M/s Global Services was such that after the
appointment of Global Services as Facilitator, if the station was
successfully commissioned and put to operation within 12 months, the
facilitator shall be appointed as operator for the site.
However, it is an admitted fact that the time period of 12 months from the
date of appointment as Facilitator expired on 20.01.2021, and the CNG
station at the Minto Road site was neither operational, nor were all
pending permissions and disputes settled.
It is apposite to state with emphasis that your appointment as facilitator
was made pursuant to you clearing the Interview process, and
subsequently, by way of Letter dated 16.01.2020, you were Informed about
your selection as Facilitator subject to a non-refundable deposit of an
amount of Rs. 3,00,000/- + GST @ 18% vide Demand Draft within 7 days.
By way of the same Letter dated 21.01.2020, you were informed about the
scope of work and that the validity of engagement as facilitator was for 6
months, subject to an extension of 6 months (3+3) depending on the
progress of the case after the approval from competent authority.
It is also not in dispute that you have not sought any extension inspite of
the expiry of the term of engagement. Further, It is reiterated that the work
allotted to you by way of the Letter of Intent’ has not been completed by
you, since the CNG Station has not been commissioned.
Therefore, in light of the above-stated facts, you are hereby called upon to
show cause why the ‘Letter of Intent dated 21.01.2020 should not be
terminated by IGL.
You may submit your reply within 15 days of the receipt of this Letter,
failing which the Letter of Intent would be automatically terminated on
account of ‘no response’.
Yours faithfully,
Sd/-
Sanjeev Kumar Bhatia,
Vice President (Business Development & Gas Sourcing)”
10. A reply dated 20.10.2022 to the show-cause notice was submitted by
the petitioner vehemently opposing the allegations levied against it. Further,
an opportunity of hearing was also granted to the petitioner on11.11.2022.
Signature Not Verified
Digitally Signed
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By:CHINU LUTHRA
Signing Date:30.04.2026
17:50:06
11. Subsequently, the 172ndmeeting of the Board of Directors of the
respondent no.1, which convened on 07.04.2023 and 08.04.2023, after
considering legal opinion and internal committee recommendations, passed a
resolution to (i) cancel the LOI issued in favour of the petitioner and other
similarly situated allottees under the CODO model (ii) operate the concerned
sites as IGL retail outlets under the Company Owned, Company Operated
(COCO) model. The Minutes of the said meeting reads as under:-
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By:CHINU LUTHRA
Signing Date:30.04.2026
17:50:06
12. Consequently, the impugned letter/communication dated 11.05.2023
came to be issued by the respondent no.1, formally ceasing all relationship
which existed with the petitioner. The impugned letter/communication reads
as under: –
Signature Not Verified
Digitally Signed
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By:CHINU LUTHRA
Signing Date:30.04.2026
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Signature Not Verified
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By:CHINU LUTHRA
Signing Date:30.04.2026
17:50:06
13. In the aforesaid conspectus, being aggrieved, the petitioner filed the
present petition seeking to set-aside the impugned letter/communication and
to direct the respondent no.1 to execute dealership agreement viz. the CNG
facility situated at the Minto Road, Delhi, in its favour.
SUBMISSIONS ON BEHALF OF THE PETITIONER
14. Learned counsel on behalf of the petitioner submitted that the
concerned CNG Station was commissioned and inaugurated on 18.08.2020.
The said position has been admitted by the respondent no.1 in its document
dated 17.10.2022 and can be corroborated from the inauguration photographs
attached by the petitioner as Annexure 30 to the present petition. However,
despite the petitioner fulfilling its mandate of commissioning the CNG
Station within the prescribed timeline, the respondent no.1 terminated the
LOI instead of honouring the same by executing the dealership agreement.
15. It is submitted that the LoI dated 16.01.2020 clearly stipulated that the
Signature Not Verified
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By:CHINU LUTHRA
Signing Date:30.04.2026
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petitioner “shall” be appointed as the operator if the station is successfully
commissioned and put to operation.
16. It is also contended that the LOI dated 20.01.2020 and the scope of
work appended thereunder having been unequivocally accepted/confirmed by
the parties resulted in a concluded contract. Further, the parties having acted
upon the said terms, stood bound by the concluded contract and thus, it was no
longer within the discretion of respondent no. 1 to withhold execution of the
dealership agreement; rather, it was incumbent upon it to execute the same
pursuant to the successful commissioning of the CNG station by the
petitioner. In this regard reliance has been placed upon judgment rendered by
the Supreme Court in South Eastern Coalfields Ltd. v. S. Kumar’s
Associates AKM (JV), (2021) 9 SCC 166 and this Court in W.P (C) No.
10124/2022 captioned as York Tech Pvt. Ltd. v. Delhi Development
Authority.
17. It is further submitted that the respondent no.1 is a ‘State’ within the
meaning of Article 12 of the Constitution of India inasmuch as respondent
no.1 is (i) responsible for setting up CNG Station in Delhi-NCR region, which
falls in the domain of public duty (ii) more than 51% shareholding of
respondent no.1 is with the State and its PSUs (22.5% shareholding are held
by BPCL and GAIL respectively, 7% shareholding is held LIC and 5% is held
by GNCTD)
18. Further, by placing reliance upon judgment rendered by the Supreme
Court in Mihan India Ltd vs GMR Airports., (2022) SCC OnLine SC 574 it
is contended that the issuance of a letter of acceptance/award is a concluded
contract, even if the formal agreement was not executed.
19. It is contended that even otherwise, a discretion cannot be unfettered
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By:CHINU LUTHRA
Signing Date:30.04.2026
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and absolute in nature and must satisfy the rigours of Article 14 of the
Constitution of India and principles of natural justice; any arbitrary or
unreasonable exercise of such discretion by the State or its instrumentality
even in contractual matters, renders it amenable to judicial review.
20. It is also contended that in terms of the LOI and its own policy,
respondent no.1 was obligated to appoint the petitioner as operator of the
concerned CNG station, upon its successful commissioning. Thus, unilateral
termination of LOI, despite the mandate being fulfilled by the petitioner
clearly amounts to breach/violation of the principle of legitimate
expectations, and bounds the respondent no.1 by the doctrine of promissory
estopple.
21. It is further submitted that petitioner made various representation to the
respondent no.1 intimating that the work allotted in terms of the LOI at the
subject site is complete and CNG station can be operated therein. However,
the respondent no.1 without considering the said representations, issued the
show cause notice dated 06.10.2022.
22. It is stated that the subject site at Minto Road was admittedly allotted
by the respondent no.2 to respondent no.1 way back in the year 2008,
however, prior to appointment of the petitioner as facilitator/without
assistance of the petitioner, respondent no.1’s effort to operationalise the said
site remained futile.
23. It is also contended that the impugned decision has been passed without
taking into consideration reply dated 20.10.2022 to the show-cause notice and
thus is in clear contravention of the principles of natural justice. By placing
reliance on Nareshbhai Bhagubai & Ors. v. Union of India.,(2019) 15 SCC
1; Ravi Yashwant Bhoir v. District Collector, Raigad and Ors.,(2012) 4 SCC
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407; Tarlochan Dev Sharma v. State of Punjab., (2001) 6 SCC 260 it is
contended that adjudication of reply to show cause notice cannot be a mere
empty formality and consideration of same should clearly be borne out in the
final decision.
24. Further, it is stated that the plea/defences set up in the counter-affidavit
for undertaking/justifying the impugned action, particularly the alleged
discretion of the respondent no.1 to execute the dealership agreement, have
not been taken in the impugned letter/communication. It is contended that the
respondent no.1 has in fact sought to improve its case in the counter-affidavit
which is wholly impermissible.
SUBMISSIONS ON BEHALF OF THE RESPONDENT NO.1
25. Learned counsel on behalf of the respondent submitted that the present
petition is not maintainable inasmuch as:
i. Respondent no.1 is not a ‘State’ under Article 12 of the Constitution of
India as it is a registered non-governmental company (incorporated in
1988) and listed on BSE and NSE. Thus, it is not amenable to writ
jurisdiction.
ii. LOI dated 21.01.2020 is commercial in nature, non-statutory and
respondent no.1 was not acting in discharge of any public function.
Even otherwise, a contract would not become statutory merely because
it pertains to construction of public utility or has been awarded by a
statutory body. In this regard reliance is placed upon judgment
rendered by the Supreme Court in Kerala State Electricity Board and
Ors vs Kurien E. Kalathil and Ors., MANU/SC0435/2000.
iii. The impugned decision came to be issued only pursuant to the internal
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By:CHINU LUTHRA
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committee advise, which ultimately led to the respondent no.1 in 172nd
Board Meeting dated 08.04.2023 resolving that the LOI dated
21.01.2020 issued to the petitioner has already expired due to efflux of
time and that the petitioner has failed to fulfil its obligation under the
scope of work. Therefore, impugned action being a pure policy
decision ought to be not interfered by this Court.
iv. The petitioner categorically denies committing any breach of contract
and also the Scope of Work issued with the LOI dated 21.01.2020,
despite the same bearing its signatures. Further, the formation of
contract itself is disputed. It is a settled position of law that where
execution and obligations under the contract are in dispute and/or the
contractual interpretations are disputed, a writ court cannot interfere.
v. The petitioner herein virtually seeks specific performance of the
contract/LOI issued by the respondent no.1. However, it is trite law that
remedy for specific performance lies under the Specific Performance
Relief Act, 1963 and thus no writ can be issued for furtherance of the
same.
26. It is further submitted that the arrangement between the parties did not
tantamount to a concluded contract inasmuch as the essential terms were not
agreed upon like principal to principal or principal to agent.
27. By placing reliance upon judgment rendered by the Supreme Court in
Speech and Software Technologies (India) Pvt. Ltd vs Neos Interactive
Ltd., MANU/SC/8370/2008 it is contended that the law is well settled that an
agreement to enter into an agreement is neither enforceable nor confers any
right upon the parties. Even otherwise, since the petitioner disputes the Scope
of Work, the LOI dated 21.01.2020 is an agreement to agree and not
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enforceable.
28. Furthermore, it is stated that the petitioner was appointed as a
‘facilitator’ for a period of 12 months and ‘dealership for 10 years’ was
contingent only upon its successful commissioning. However, since the
petitioner did not obtain any licenses/approvals/compliances as outlined in
the Scope of Work, it failed to perform its obligations under the LOI dated
21.01.2020.
29. It is also contended that the LOI dated 20.01.2020 categorically
stipulated awarding of operatorship/dealership to the petitioner as a
“discretion” of respondent no.1 and in terms of Clause 9 of the EoI dated
03.07.2019, the respondent no.1 confers the right to terminate the LoI on
account of non-performance.
30. Pursuant to the issuance of the impugned notice, upon request of the
petitioner, the respondent no.1 refunded the security deposit and further
provided its approval/no objection vide discharge letter dated 10.01.2025 for
cancelation of BG furnished. The aforesaid request of the petitioner and
subsequent acceptance of refunded security deposit, evidently can be
construed as deemed acceptance to the impugned decision.
31. It is further submitted that the reliance placed by the petitioner on a
document dated 17.01.2022 to substantiate its commissioning of the CNG
station in terms of the LOI is misplaced as the said document is an internal
departmental noting which has no sanction of law and cannot be construed as
a final authority. Furthermore, the petitioner has wrongfully portrayed the
pictures (annexed as Annexure-30) taken during an inspection by respondent
no.1 as that of inauguration of the concerned CNG station.
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By:CHINU LUTHRA
Signing Date:30.04.2026
17:50:06
ANALYSIS AND CONCLUSION
32. At the outset, this Court is not persuaded to accept the plea that the
respondent no.1 is not amenable to writ jurisdiction on account of being a
company incorporated under the Companies Act, 2013 which does not fall
within the meaning of ‘State’ under Article 12 of the Constitution of India.
33. The law is well settled that under Article 226 of the Constitution of
India a writ can be issued even against an entity which may not be a ‘State’
within the meaning of Article 12 of the Constitution of India if it discharges a
public duty or a positive obligation that is public in nature, provided that the
relief/rights ought to be agitated against an action must be in direct nexus with
discharge of a public function by the concerned entity.
34. The said view has been reiterated time and again by the Supreme Court
in various judgments including in S. Shobha vs Muthoot Finance Ltd., 2025
SCC OnLine SC 177 wherein it has been observed as under:-
“8. A body, public or private, should not be categorized as “amenable” or
“not amenable” to writ jurisdiction. The most important and vital
consideration should be the “function” test as regards the maintainability
of a writ application. If a public duty or public function is involved, any
body, public or private, concerned or connection with that duty or
function, and limited to that, would be subject to judicial scrutiny under
the extraordinary writ jurisdiction of Article 226 of the Constitution of
India.
9. We may sum up thus:
(1) For issuing writ against a legal entity, it would have to be an
instrumentality or agency of a State or should have been entrusted with
such functions as are Governmental or closely associated therewith by
being of public importance or being fundamental to the life of the people
and hence Governmental.
(2) A writ petition under Article 226 of the Constitution of India may be
maintainable against (i) the State Government; (ii) Authority; (iii) aSignature Not Verified
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statutory body; (iv) an instrumentality or agency of the State; (v) a
company which is financed and owned by the State; (vi) a private body run
substantially on State funding; (vii) a private body discharging public
duty or positive obligation of public nature; and (viii) a person or a body
under liability to discharge any function under any Statute, to compel it to
perform such a statutory function.
(3) Although a non-banking finance company like the Muthoot Finance
Ltd. with which we are concerned is duty bound to follow and abide by the
guidelines provided by the Reserve Bank of India for smooth conduct of its
affairs in carrying on its business, yet those are of regulatory measures to
keep a check and provide guideline and not a participatory dominance or
control over the affairs of the company.
(4) A private company carrying on banking business as a Scheduled bank
cannot be termed as a company carrying on any public function or public
duty.
(5) Normally, mandamus is issued to a public body or authority to compel
it to perform some public duty cast upon it by some statute or statutory
rule. In exceptional cases a writ of mandamus or a writ in the nature of
mandamus may issue to a private body, but only where a public duty is
cast upon such private body by a statute or statutory rule and only to
compel such body to perform its public duty.
(6) Merely because a statue or a rule having the force of a statute requires
a company or some other body to do a particular thing, it does not possess
the attribute of a statutory body.
(7) If a private body is discharging a public function and the denial of any
rights is in connection with the public duty imposed on such body, the
public law remedy can be enforced. The duty cast on the public body may
be either statutory or otherwise and the source of such power is
immaterial but, nevertheless, there must be the public law element in such
action.
(8) According to Halsbury’s Laws of England, 3rd Ed. Vol.30, p.682, “a
public authority is a body not necessarily a county council, municipal
corporation or other local authority which has public statutory duties to
perform, and which perform the duties and carries out its transactions for
the benefit of the public and not for private profit”. There cannot be any
general definition of public authority or public action. The facts of each
case decide the point.”
35. Likewise, the Supreme Court in St. Mary’s Education Society and
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Anr. vs Rajendra Prasad Bhargava and Ors., (2023) 4 SCC 498 observed as
under:-
“43. In the background of the above legal position, it can be safely
concluded that power of judicial review under Article 226 of the
Constitution of India can be exercised by the High Court even if the body
against which an action is sought is not State or an authority or an
instrumentality of the State but there must be a public element in the action
complained of.
44. A reading of the above extract shows that the decision sought to be
corrected or enforced must be in the discharge of a public function. No
doubt, the aims and objective of Appellant 1 herein are to impart
education, which is a public function. However, the issue herein is with
regard to the termination of service of Respondent 1, which is basically a
service contract. A body is said to be performing a public function when it
seeks to achieve some collective benefit for the public or a section of the
public and is accepted by the public or that section of the public as having
authority to do so.
xxx xxxxxx
66. Merely because a writ petition can be maintained against the private
individuals discharging the public duties and/or public functions, the same
should not be entertained if the enforcement is sought to be secured under
the realm of a private law. It would not be safe to say that the moment the
private institution is amenable to writ jurisdiction then every dispute
concerning the said private institution is amenable to writ jurisdiction. It
largely depends upon the nature of the dispute and the enforcement of the
right by an individual against such institution. The right which purely
originates from a private law cannot be enforced taking aid of the writ
jurisdiction irrespective of the fact that such institution is discharging the
public duties and/or public functions. The scope of the mandamus is
basically limited to an enforcement of the public duty and, therefore, it is
an ardent duty of the court to find out whether the nature of the duty comes
within the peripheral of the public duty. There must be a public law
element in any action.”
(emphasis supplied)
36. Further, in line with the aforesaid, vide order dated 06.02.2026 passed
in W.P(C) 4160/2019 a coordinate Bench of this Court discussed the
maintainability of writ petition against respondent no.1 as under: –
“Analysis Maintainability: Article 12 and the public law threshold
6. The Petitioner proceeds on the premise that IGL is ‘State’ under Article
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12. The material placed by IGL, however, points in a different direction.
IGL is a listed company. The shareholding disclosed is that 50% is public
shareholding, 22.5% is held by GAIL (India) Ltd., 22.5% by BPCL, and
5% by GNCTD. It is also asserted that IGL does not receive governmental
grants or budgetary support, and it operates on internal accruals. Its
dividends are distributed to shareholders. The Board, as described,
comprises nominee directors of the shareholders and independent
directors.
7. The Article 12 inquiry is not concluded by the presence of government
shareholding. The controlling tests, post Ajay Hasia v. Khalid Mujib5 and
its later elucidation in Pradeep Kumar Biswas v. Indian Institute of
Chemical Biology, look to deep and pervasive governmental control, the
source of financial dependence, and whether the body is essentially an
instrumentality or agency of the State. On the material pleaded, the
element of decisive governmental ownership and control is not made out.
Public shareholding is substantial. The Petitioner has not placed any
cogent material to show that governmental control is so pervasive as to
render IGL a state instrumentality in its management and
decision-making.
8. There is, however, a distinct strand of law which recognises that a writ
may, in exceptional circumstances, issue even to a non-State entity when it
is discharging a public duty of a public character. Decisions such as Andi
Mukta Sadguru Shree Muktajee Vandas Swami Suvarna Jayanti Mahotsav
Smarak Trust v. V.R. Rudani, and Binny Ltd. v. V. Sadasivan explain the
underlying principle. However, this route does not dispense with the core
requirement that the lis must have a public law element. A writ is not a
forum to enforce purely private service rights in the guise of public duty.
9. IGL’s business of supplying natural gas to consumers in the National
Capital Region has an undeniable public interface. Even so, the present
dispute is not about supply obligations, consumer rights, regulatory
compliance, or a statutory duty owed to the public. The Petitioner asks for
a mandamus to grant him three promotions, retrospectively and in one
sweep, based on an internal promotion policy and performance
management framework. That claim, at its heart, is a service dispute of a
private character. Even if IGL were assumed to discharge certain public
functions, a writ of mandamus does not ordinarily lie to adjudicate and
enforce inter se service entitlements of employees, where the grievance
does not bear upon any public duty owed by the entity to the public at
large. The petition therefore falters at the threshold.”
37. As a matter of fact, the respondent no.1 took over the Delhi City Gas
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Distribution Project in 1999 from GAIL and since then has been a
government authorised agency for distribution of Piped Natural Gas and
operation of CNG facilities for domestic, industrial and commercial purposes
across Delhi-NCR region. Undoubtably, the respondent no.1 has been
engaged in supply of essential services/commodities to individuals across
Delhi-NCR region and is therefore performing an important public function,
carried out for the benefit of the public, and is therefore amenable to writ
jurisdiction.
38. However, having held that the respondent no.1 is amenable to writ
jurisdiction, it remains to be seen whether the said jurisdiction is liable to be
exercised in the present case.
39. In the factual conspectus of the present case, the petitioner has failed to
make out any case for grant of relief sought by way of the present petition.
The reasons are enumerated hereunder:
39.1. Essentially, the disputes between the parties are not in relation to
any obligation, rights and duty that the respondent no.1 owes to the
petitioner in discharging any public function. Instead, the disputes between
the parties are purely contractual in nature. In S. Shobha (supra) and St.
Mary’s Education Society and Anr (supra), it has been categorically held
that even in the context of a body/entity discharging public duty, writ ought
not to be entertained, if the controversy is in the realm of private law.
39.2. There are serious factual disputes pertaining to (i) scope of work
(ii) alleged inauguration of site (iii) alleged breaches committed by the
petitioner (vi) apportionment of responsibilities in taking approvals and
licenses (v) whether any actual work was performed by the petitioner
(vi)whether there existed any concluded contract between the parties. The
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legal position is well settled that it would be inapposite to adjudicate
disputed factual and contractual issues, in exercise of writ jurisdiction. In
this regard, reference may be made to the observations of the Supreme
Court in State of Bihar and Ors. Vs. Jain Plastics and Chemicals Ltd.
(2002) 1 SCC 216, it has been held as under:
“3. writ is not the remedy for enforcing contractual obligations. It is to be
reiterated that writ petition under Article 226 is not the proper proceeding
for adjudicating such disputes. Under the law, it was open to the
respondent to approach the Court of competent jurisdiction for
appropriate relief for breach of contract. It is settled law that when an
alternative and equally efficacious remedy is open to the litigant, he
should be required to pursue that remedy and not invoke the writ
jurisdiction of the High Court. Equally, the existence of alternative remedy
does not affect the jurisdiction of the Court of issue writ, but ordinarily
that would be a good ground in refusing to exercise the discretion under
Article 226.
xxx xxxxxx
7. In our view, it is apparent that the order passed by the High Court is on
the face of it illegal and erroneous. It is true that many matters could be
decided after referring to the contentions raised in the affidavits and
counter-affidavits, but that would hardly be ground for exercise of
extraordinary jurisdiction under Article 226 of the Constitution in case of
alleged breach of contract. Whether the alleged non-supply of road
permits by the appellants would justify breach of contract by the
respondent would depend upon facts and evidence and is not required to
be decided or dealt with in a writ petition. Such seriously disputed
questions or rival claims of the parties with regard to breach of contract
are to be investigated and determined on the basis of evidence which may
be led by the parties in an properly instituted civil suit rather than by a
Court exercising prerogative of issuing writs.
Also, in Municipal Council, Gondia Vs. Divi Works & Suppliers, HUF and
Ors.2022 SCC OnLine SC 247, it has been held as under:
“8. At the outset, it is required to be noted that by the impugned judgment
and order the High Court has issued a writ of mandamus virtually
granting the relief of specific performance of the contract/work order.
From the impugned judgment and order passed by the High Court it
appears that the High Court was made to believe that the original writ
Petitioners had already manufactured the goods which are customizedSignature Not Verified
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and as per the specifications and the work order. However, it is now found
that there are no manufactured goods readily available which can be
supplied to the Appellant – Council. There are disputed questions of fact
such as whether in fact the goods were manufactured as per the
specifications or not. Nothing was on record before the High Court that
goods were in fact and actually manufactured by the original writ
Petitioner No. 1, as per the specifications and the requirements of the
Council and as per the work order. In absence of any evidence and
material on record and there being disputed questions of facts the High
Court ought not to have passed the impugned judgment and order
directing the Council to continue the work order and accept the goods
from the original writ Petitioner No. 1 and to make the payments as per the
work order. Even otherwise, no writ of mandamus could have been issued
virtually granting the writ for specific performance of the contract/work
order in a writ petition Under Article 226 of the Constitution of India. The
original writ Petitioners ought to have been relegated to file a civil suit for
appropriate relief of losses/damages, if any, sustained.
8.1. Even otherwise on merits also the High Court has erred in setting
aside the communication dated 18.05.2020 and 07.07.2020. The High
Court has not at all appreciated the reasons for suspending/cancelling the
work order till further orders. It is to be noted that the decision dated
07.07.2020 was taken pursuant to the G.R. dated 04.05.2020 which was
necessitated due to Covid-19 Pandemic and there was a lockdown and the
schools were closed and that the Council had no sufficient funds. Even the
said decision was taken after calling for a report from the Education
Officer in regard to the tender/work order issued to the original writ
Petitioner No. 1 and the Education Officer informed that the original writ
Petitioner No. 1 has not taken any further steps in regard to supply of
material as per the work order. Therefore, the HighCourt has erred in
quashing and setting aside the communication dated 07.02.2020 in
exercise of powers Under Article 226 of the Constitution of India.”
39.3. It is also noticed that prayer (b) as sought by the petitioner in the
present petition, reads as under:
“b) In view of prayer (a), issue an appropriate Writ under Article 226
directing the Respondent no.1 to execute the Dealership Agreement, in
terms of its own policy, in favour of the Petitioner.”
It is evident that the petitioner in the present case seeks execution of a
dealership agreement in its favour and the relief sought virtually
tantamounts to seeking specific performance, which again cannot be
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granted in exercise of writ jurisdiction. In this regard, reference may be
made to observations of the Supreme Court Noble Resources Ltd. Vs. State
of Orissa and Ors. (2006) 10 SCC 236, the same reads as under:
“32. Moreover, certain serious disputed questions of fact have arisen for
determination. Such disputed questions of facts ordinarily could not have
been entertained by the High Court in exercise of its power of judicial
review. Ordinarily, a specific performance of contract would not be
enforced by issuing a writ of or in the nature of mandamus, particularly
when keeping in view the provisions of the Specific Relief Act, 1963
damages may be an adequate remedy for breach of contract.
XXX XXX XXX
34. For the reasons aforementioned, we are of the opinion that although
the approach of the High Court was not entirely correct, its ultimate
decision to refuse to exercise its discretionary jurisdiction cannot be
faulted with. The appeal is, therefore, dismissed. We, however, leave it
open to the Appellant to take recourse to the other remedy which is
available in law. In the facts and circumstances of the case, there shall be
no order as to costs.”
Likewise, in Joshi Technologies International Inc. vs Union of India,
(2015) 7 SCC 728, the Supreme Court inter-alia observed as under:
“……..70.6. Ordinarily, where a breach of contract is complained of, the party
complaining of such breach may sue for specific performance of the contract, if
contract is capable of being specifically performed. Otherwise, the party may sue
for damages.
xxx xxxxxx
70.11. The scope of judicial review in respect of disputes falling within the
domain of contractual obligations may be more limited and in doubtful cases the
parties may be relegated to adjudication of their rights by resort to remedies
provided for adjudication of purely contractual disputes.”
39.4. It also transpires that as a policy decision, the Board of Directors
of respondent no.1 in 139th Meeting held on 12.01.2021, considering the
shortcomings and difficulties faced under the “CODO on Government
land” model proposed for its discontinuation. Consequently, it was directed
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that various modalities involved thereof, particularly pertaining to the LOIs
already issued thereunder be appropriately decided/dealt with, in a time
bound manner, as per the provisions of the LOIs. Subsequently, in the
172nd Meeting of the Board of Directors, convened between 07.04.2023
and 08.04.2023, the Board observed that (i) Legal opinion from former
judge of Supreme Court concludes that LOI can be cancelled on account of
non-performance and same having been lapsed(ii) Internal committee also
recommended to cancel the LOIs issued to the petitioner. On 08.04.2023, a
policy decision considering the aforesaid was taken inter-alia to the effect
that the LOI issued in favour of the petitioner was resolved to be cancelled
and the CNG station at the Minto Road, Delhi be operated under the
“Company Owned Company Operated Model (COCO model)”. It was in
pursuance to this policy decision that the impugned order was passed to
cancel the LOI issued in favour of the petitioner.
In these proceedings, there is no scope for this Court to interfere with the
aforesaid policy decision taken by the respondent no.1. Essentially, the
petitioner seeks that the respondent no.1 be directed to appoint the
petitioner as dealer in respect of a company owned site/station at Minto
Road in derogation of the extant policy. The same is clearly untenable.
40. Learned counsel for the petitioner seeks to contend that the terms of the
LOI tantamount to a dealership itself. According to the petitioner,
successful facilitation and award of dealership are intertwined and cannot be
separated; they are two stages of the same contract. However, the said
contention is also unmerited for reasons enumerated under: –
41. It is untenable for the petitioner to equate grant of LOI with grant of
dealership inasmuch as-
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a. In the LOI dated 21.01.2020, it is categorically recorded that the
petitioner has been appointed as “facilitator for getting all the
statutory clearance and making the CNG stations operational”.
b. As regards the awarding of the dealership/operatorship, it is noticed
that the Note of Approval dated 10.06.2019 categorically records
that awarding of dealership/operatorship shall be “at the discretion
of management”. The relevant portion therein reads as under: –
“This policy would also be applicable for lands which have
already been allotted to IGL but are not operational for more
than 6 months after allotment due to dispute. Any
individual/agency offering to solve the problem put the station
to operation will be awarded dealership for a limited period of
10 years at the discretion of management on
recommendation of the panel.”
Again, the note at the foot of the scope of work appended to the
LOI dated 21.01.2020 clearly mentions that the award of
dealership would be at the “discretion of the management”. The
relevant portion thereof reads as under: –
“The applicant would be awarded the operatorship for a
limited period of 10 years (5+5) at the discretion of the
management”.
Further, in the Expression of Interest dated 03.07.2019, it has
been mentioned as under:
“7. If the candidate is successful in getting the matter
resolved, the candidate would be appointed as a dealer for
that particular site for a period of 10 years.”
As such, it is evident that the appointment of the petitioner as a
“facilitator” does not automatically translate into an indefeasible
right to award / grant of dealership/operatorship of the concerned
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CNG facility/station. Thus, this Court does not find any merit in
the contention of the petitioner that the appointment of the
petitioner as “facilitator” tantamount to grant of
dealership/operatorship.
42. A dealership agreement of the kind as sought by the petitioner is
inherently terminable. In this regard, reference may be made to judgment
rendered by a three Judge Bench of the Supreme Court in Indian Oil Corpn.
Ltd. v. Amritsar Gas Service, (1991) 1 SCC 533, as under:-
“12. The arbitrator recorded finding on Issue No. 1 that termination
of distributorship by the appellant-Corporation was not validly made
under clause 27. Thereafter, he proceeded to record the finding on
Issue No. 2 relating to grant of relief and held that the
plaintiff-respondent 1 was entitled to compensation flowing from the
breach of contract till the breach was remedied by restoration of
distributorship. Restoration of distributorship was granted in view of
the peculiar facts of the case on the basis of which it was treated to be
an exceptional case for the reasons given. The reasons given state that
the Distributorship Agreement was for an indefinite period till
terminated in accordance with the terms of the agreement and,
therefore, the plaintiff-respondent 1 was entitled to continuance of the
distributorship till it was terminated in accordance with the agreed
terms. The award further says as under:
“This award will, however, not fetter the right of the defendant
Corporation to terminate the distributorship of the plaintiff in
accordance with the terms of the agreement dated April 1, 1976,
if and when an occasion arises.”
This finding read along with the reasons given in the award clearly
accepts that the distributorship could be terminated in accordance
with the terms of the agreement dated April 1, 1976, which contains
the aforesaid clauses 27 and 28. Having said so in the award itself, it
is obvious that the arbitrator held the distributorship to be revokable
in accordance with clauses 27 and 28 of the agreement. It is in this
sense that the award describes the Distributorship Agreement as one
for an indefinite period, that is, till terminated in accordance with
clauses 27 and 28. The finding in the award being that the
Distributorship Agreement was revokable and the same being
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admittedly for rendering personal service, the relevant provisions of
the Specific Relief Act were automatically attracted. Sub-section (1)
of Section 14 of the Specific Relief Act specifies the contracts which
cannot be specifically enforced, one of which is ‘a contract which is in
its nature determinable’. In the present case, it is not necessary to
refer to the other clauses of sub-section (1) of Section 14, which also
may be attracted in the present case since clause (c) clearly applies on
the finding read with reasons given in the award itself that the
contract by its nature is determinable. This being so granting the
relief of restoration of the distributorship even on the finding that the
breach was committed by the appellant-Corporation is contrary to the
mandate in Section 14(1) of the Specific Relief Act and there is an
error of law apparent on the face of the award which is stated to be
made according to ‘the law governing such cases’. The grant of this
relief in the award cannot, therefore, be sustained.”
The said view has also been reiterated by a Coordinate Bench of the Punjab
and Haryana High Court in Jaipur Metals and Electricals Ltd. vs Jain
Industries, Rohtak and Ors., 1993 SCC OnLine P&H 989 as under:-
“6……. The learned Additional District Judge has not appreciated that
under subsection (1) of Section 14 of the Specific Relief Act, certain
contracts are not enforceable, one of which, clause (c) is a contract
which in its nature is determinable. The word ‘determinable’ means
that which can be put an end to Determination is the putting of a thing
to an end, Clause (c) enacts that the contract cannot be specifically
enforced, if it in its nature, is determinable. Section 41, clause (e) of the
Specific Relief Act provides that an injunction cannot be granted to
prevent the breach of a contract, the performance of which would not
specifically be enforced. Thus, if the plaintiff cannot enforce a contract
which is determinable, then how the defendant can be restrained from
not terminating it. Apart from this, assuming for the sake of argument
that the dealership had been wrongly terminated, even then in law, the
dealer can claim damages but in no case the dealership can be restored.
Dealership is inherently terminable in law and normally no order of
injunction can be granted restraining the terminating of the dealership
because the effect would be decreeing the suit at the initial stage.
43. Lastly, even in the context of termination of a dealership, this Court
would be loath to interfere with the same, especially, where the controversy is
in a purely contractual conspectus and there are disputed questions of fact (as
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in the present case). In numerous judicial precedents, it has been held that in
such cases the aggrieved party must be relegated to claim damages. In this
regard, reference may be made to judgment rendered by the Division Bench
of this Court in Rajasthan Breweries Ltd. v. The Stroh Brewery
Company, 2000 SCC OnLine Del 481, which observed as under:
“Even in the absence of specific clause authorising and enabling
either party to terminate the agreement in the event of happening of
the events specified therein, from the very nature of the agreement,
which is private commercial transaction, the same could be
terminated even without assigning any reason by serving a
reasonable notice. At the most, in case ultimately it is found that
termination was bad in law or contrary to the terms of the agreement
or of any understanding between the parties or for any other reason,
the remedy of the appellants would be to seek compensation for
wrongful termination but not a claim for specific performance of the
agreements and for that view of the matter learned Single Judge was
justified in coming to the conclusion that the appellant had sought for
an injunction seeking to specifically enforce the agreement. Such an
injunction is statutorily prohibited with respect of a contract, which is
determinable in nature. The application being under the provisions of
Section 9(ii)(e) of the Arbitration and Conciliation Act, relief was not
granted in view of Section 14(i)(c) read with Section 41 of the Specific
relief Act. It was rightly held that other clauses of Section 9 of the Act
shall not apply to the contract, which is otherwise determinable in
respect of which the prayer is made specifically to enforce the same.”
Likewise, a coordinate Bench of this Court in R.P.S Educational Society
(REGD.) vs. Delhi Development Authority, 2009: DHC:3604 observed as
under: –
“6. Termination of the contract is one of the facets of the commercial
law and if a party is aggrieved that the contract was wrongly
terminated, the remedy lies in claiming damages. The party cannot
insist that the contract should be specifically performed and it should be
restored to the position prior to the breach of the contract…..”
44. The judgment of the Supreme Court in Mihan India Ltd. v. GMR
Airports (2022) SCC Online 574, strongly relied upon by the petitioner, is
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clearly distinguishable in the facts and the circumstances of the present case.
In Mihan India Ltd (supra) findings rendered by the Supreme Court were
specifically as regard the deviation from the mandatory procedures outlined
in the concerned Request for Proposal (RfP). Dispute arose between the
parties as regards the decision of the authority to annul a tender just before the
execution of the concession agreement, despite the petitioner therein
unequivocally satisfying the stipulated pre-bid conditions. The Supreme
Court held that contract was already concluded between the parties as the
petitioner therein had completed all formalities in terms of the pre
bid-conditions stipulated in the RfP i.e., (i) qualified the test of
responsiveness (ii) was declared selected upon making offer of the highest
revenue (iii) the letter issued pursuant thereto accepting revised proposal of
the petitioner therein, was in the nature of a Letter of Acceptance (vi) draft of
Concession Agreement was issued by the Concessionaire. Thus, annulment of
bidding process post acceptance of a bid was found to be untenable, in the
light of the peculiar facts and circumstances. As noticed hereinabove, the
factual conspectus in the present case is totally different.
45. For the above reasons, no merit is found in the present petition and the
same is, accordingly, dismissed. All interim order/s stand vacated. There shall
be no orders as to cost. Pending applications also stand disposed of.
SACHIN DATTA, J
APRIL 30, 2026/sl/at
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