Judgment:
B.L. Hansaria, C.J.
1. The core question for determination in this application is whether Nuanai fishery sairat should be settled in favour of a multi-millionire as opp. party No. 5, M/s. Toshali Sands, a Division of T. K. International Ltd., happens to be, who is mainly interested in the area of the fishery sairat for developing a water sports complex to attract foreign tourists, or it should be settled in favour of bona fide co-operative societies consisting of genuine local fishermen who earn their livelihood by catching fish.
2. This question has not come up before us for the first time inasmuch as a related matter presented itself to this Court in O. J. C. No. 2016 of 1989. In that case, Dusasan Pradhan, who was the petitioner, had been granted settlement of the aforesaid fishery sairat whereas Toshali Sands was permitted to develop water sports complex in the area. On not being able to enjoy his rights in respect of the fishery sairat, Dusasan Pradhan filed the aforesaid writ application. This Court went through the various aspects of the matter and by its judgment rendered on 11-9-1989 came to the conclusion that the right of both the parties could coexist as water sports complex activities could be carried on during the day time and fishing could be done during the night. The authorities were, therefore, directed to evolve a working arrangement to see that nobody is prejudiced. Pursuant to this judgment, it was decided that water sports complex activities would be carried on during 6.00 a. m. and 6.30 p. m. whereas fishing operation would take place from 7.00 p. m. to 5.30 a. m., as reflected in Annexure-9 dated 23-4-1990, which is an order of the Government of Orissa in the Irrigation and Power Department.
3. After the period of settlement which was the subject-matter of the aforesaid OJC expired in 1990-91, a notice was issued on 12-4-1991 stating that auction would be held for leasing out the aforesaid sairat for the year 1991-92. It was specifically mentioned in the notice, which is at Annexure-11, that fishing would be allowed to be done between 7.00 p. m. and 5.30 a. m. and water sports complex activities would be carried on from 6.00 a. m. to 6.30 p. m. In the meantime, Tosali Sands applied for renewal of its lease relating to water sports complex and by order dated 12-6-1991, as at Annexure-6, the lease was extended for the purpose of water sports complex for a period of five years from 14-6-1991, on the terms and conditions mentioned in the order. Vide a communication dated 18-6-1991, as at Annexure-7, the public auction of the fishery sairat in question was stopped for the reason that the lease of water spread area in favour of Toshali Sands had been extended for five years taking into account the cost of fishery sairat of Nuanai river and cashew-nut plantation in its adjoining area. It is these actions of the Government, by which public auction of the fishery sairat was stopped and right in the sairat was conferred on Toshali Sands which have been assailed in this petition by Nuanai Primary Fishermen Co-operative Society with whom Manohari Primary Fishermen Co-operative Society has joined hands.
4. Shri G. Rath appearing for the petitioner contends that withdrawal of the fishery sairat from auction was an arbitrary action of the Government and the same was unreasonable as well apart from being against public interest. It is urged that as per Government policy reflected in Annexure-4, which is a communication of the Revenue Department bearing No. 36773/R, dated 27-6-1974, fishery sairat sources in the State are required to be settled ordinarily in favour of bona fide co-operative societies consisting of genuine local fishermen. Reference is also made to a communication of the Irrigation Department dated 2-7-1990 (Armexure-10) wherein while granting settlement of fishery sairat by the Irrigation Department, the instructions contained in the aforesaid circular of the Revenue Department dated 27-6-1974 were required to be kept in view. On the strength of these circulars, it is contended by the learned counsel that the fishery sairat in question could have been settled only with a bona fide co-operative society. It is also urged that Annexure-6, which is the Government order regarding leasing out the Nuanai river and the river bank for introduction of water sports complex, is completely silent about granting of fishery sairat also to Toshali Sands. It is, therefore, submitted that Annexure-7 has departed from the lease granted to Toshali Sands by Annexure-6.
5. Before we proceed to examine the tenability of the contentions raised by Shri G. Rath, it would be apposite to bear in mind that it is well settled by now that Government is not free like a private individual to deal with the question of granting of jobs, contracts, lease, licences, quotas, etc. any way it chooses to do. It was clearly stated in Ramana Dayaram Shetty v. International Airport Authority of India, AIR 1979 SC 1628, that the discretion of the Government in the matter of grant of largess is not unlimited in that the Government cannot give or withhold largess in its arbitrary discretion or at its sweet will. It was further emphasised in Kasturi Lal v. State of Jammu and Kashmir, AIR 1980 SC 1992, that if the Government awards a contract of leases out or otherwise deals with its property or grants any other largess, it would be liable to be tested for its validity on the touch-stone of reasonableness and public interest and if it fails to satisfy either test, it would be unconstitutional and invalid. In para 12 of this judgment, it was stated that concept of reasonableness finds its positive manifestation and expression in the lofty ideal of social and economic justice which inspires and animates the Directive Principles and these Principles concretise and give shape to the concept of reasonableness by defining national aims and constitutional goals which must guide and animate governmental action. It was then observed ;
'Any action taken by the Government with a view to giving effect any one or more of the Directive Principles would ordinarily, subject to any constitutional or legal inhibitions or other overriding considerations, qualify for being regarded as reasonable, while an action which is inconsistent with or runs counter to a Directive Principle would prima facie incur the reproach of being unreasonable.'
May we say in this connection that promotion of economic interest of weaker sections of the people is a part of Directive Principle contained in Article 46 of the Constitution.
6. Viewed from this angle, we have no doubt in our mind that the claim of the petitioner-co-operative society, or for that matter the intervening co operative society had to receive priority over the claim of the multi-millionare Toshali sands for settlement of the fishery sairat. The members of the co-operative society earn their livelihood by taking settlement of the sairat whereas for Toshali Sands, it is of no consequence. Indeed, Shri G. S. Rath appearing for Toshali Sands submits that this opposite party is not interested in the fishery sairat.
6-A. In his written submission, the learned counsel has, however, emphasized that nobody has a fundamental or vested right to compel the Government to enter into a contract with it. In this connection, reference has been made to Raghunath Behera v. Revenue Divisional Commissioner, 56(1983) CLT 209, in para 5 of which it was held that a person has no fundamental right to insist that the Government must enter into a contract with him in terms of the rules contained in the administrative instruction. This proposition may not be disputed. But then, once the Government decides to enter into a contract with a citizen by way of granting lease or settlement, the same has to be reasonable and in public interest; the same cannot be decided arbitrarily. The decisions in Ramana Dayaram and Kasturi Lal (supra) leave no manner of doubt in this regard.
7. The pertinent question, therefore, is whether in preferring opp. party No. 6 for the grant of fishery sairat ignoring the claim of the local fishermen who earn their livelihood from the sairat, the Government acted reasonably. The grant of the sairat in favour of the local fishermen would have advanced the cause of social and economic justice which inspire and animate the Directive Principles, it has been clearly stated in Kasturi Lal that grant of largess by the State has to be tested for its validity on the touchstone of reasonableness and public interest and if it fails to satisfy either tests, it would be unconstitutional and invalid. It was further stated in Kasturi Lal, as already noted, that any action which is inconsistent with or runs counter to the Directive Principles would prima facie incur reproach being unreasonable. In this connection, Shri G. S. Rath has also relied on the view expressed in Kasturi Lal, that there is always a presumption that the governmental action is reasonable and it is for the party challenging its validity to show that it is vesting in reasonableness. This burden was said to be heavy and it was further stated that the Court cannot lightly assume that the action taken by the Government is unreasonable. The same view was expressed in paragraph 28 of Dwarkadas Marfatia and Sons v. Board of Trustees, AIR 1989 SC 1642, to which our attention is drawn by the learned Government Advocate.
8. We have duly considered this facet of the case and we have not been able to presuade ourselves that granting of the fishery sairat to opp. party No. 5 in preference to hungry fishermen who earn their livelihood by fishing in the river can be regarded as reasonable if the test of judging reasonableness mentioned in Kasturi Lal is borne in mind. At the cost of repetition, we would say that granting of the fishery sairat to a multi-millionaire does not advance any cause of social or economic justice which has been regarded as an inspiration of the Directive Principles. Settlement of the sairat with the fishermen would have definitely advanced this cause.
9. The question is as to why despite the above and the policy of the Government as reflected in the Revenue Department's circular of 27-6-1974, the sairat was settled in favour of Toshali Sands. Learned Government Advocate as well' as Shri G. S. Kath contends that it was not without any valid reason. In this connection, learned Government Advocate submits that the aforesaid circular of the Revenue Department desires settlement of fishery sairats in favour of bona fide co-opera live societies 'ordinarily'. It is urged, that the word 'ordinarily' would indicate that there may be exceptions to the general rule as this term does not necessarily mean 'invariably' and without exception, as stated in para 5 of Bhagabati Primary Fishermen's Co-operative Society v. State of Orissa, AIR 1987 Ori. 215. We agree. But then, what were the extraordinary circumstances which led the Government to depart from the general rule of settling the sairat with the bona fide co-operative society consisting of genuine local fishermen May we say that when principles are framed by the Government, it behaves the instrumentalities to abide by the same. Any other action would generate distrust in the mind of citizens whereas by acting according to the principles the instrumentalities can avoid any accusation of nepotism or favouritism, as stated in Maa Mangala Primary Fishery Development Cooperative Society v. State of Orissa, 63(1987) CLT 615.
10. The learned Government Advocate also draws our attention to the Revenue Department letter No. (2655 E. dated 25-9-1964 dealing with the principles of settlement of sairat sources. The principles contained in the letter of 1964 cannot hold good on the face of the subsequent circular of the Revenue Department dated 27-6-1974 referred earlier. Even so, we would state that as per the 1964 letter also, sairats are ordinarily to be settled by public auction unless there is any direction from higher authority to make the settlement otherwise than by public auction. In this connection, we are also referred to Raghunath Behera v. Revenue Divisional Commissioner (supra) in which it was held that for settlement of fishery sairat, public auction is not mandatory. We would accept this decision, but would say that to depart from the ordinary rule of public auction, some cogent grounds must exist; and these grounds must be reasonable and must advance public interest and cannot be arbitrary in view of what has been stated by the Apex Court in the decisions of Ramana Dayaram and Kasturi Lal noted above.
11. Now, let us see whether the departure from the ordinary rule can be held to be reasonable and in public interest in the present case. Shri G.S. Rath strenuously contends that as settlement of water sports complex with Toshali Sands and of fishery sairat over the same area with Dusasan Pradhan in the earlier year was adversely affecting the development of the water sports complex, it was decided as a matter of policy to grant both the rights to Toshali Sands. It is also urged that uninterrupted right of developing water sport complex, which is not confined to day-time activity but take place during the night also, would generate much foreign exchange by attracting foreign tourists inasmuch as such a water sports complex is available in the country either in Goa in the west or near Puri in the east, and foreign tourists are pouring in and Toshali Sands has caught the imagination of such tourists, as would appear from the booking position reflected in Annexure H/5. It is, therefore, urged that we may not interfere with the change in the policy decision arrived at by the Government. Learned Government Advocate also refers to Union of India v. Tej Ram, (1991) 3 SCC 11, wherein it was opined that no Tribunal or Court can compel the Government to change its policy which involves financial burden on it. Shri G. Rath appearing for the petitioner does not contest the power of the Government in changing the policy decision, indeed, the decision of this Court in Maa Mangala Primary Fishery Development Co-operative Society acknowledges this, principle.
12. From the materials on record, we do not, however, find any cogent reason to accept the submission of Shri G. S. Rath that Toshali Sands was given settlement of the fishery sairat because of any change in policy. It may be that Toshali Sands was finding it difficult to fully develop the water sports complex because of fishing being done in the night pursuant to the arrangement made by the Government after the decision of this Court was rendered in OJC No. 2016 of 1989, and it may be that complaints were made about it to the Government. But, we do not find any decision of the Government changing the policy of giving fishery sairats to bona fide co-operative societies consisting of genuine local fishermen. Though Shri G. S. Rath has invited our attention in this connection to Annexure J/5, which is a copy of the minutes of discussion held in the meeting taken by the Chief Minister on 25-1-1991 on development of tourism in the State and though in paragraph 14 of these minutes the Chief Minister stressed on the development of tourism and taking up of canoeing at water-spreads, we do not find any mention in it about non-giving of fishery sairats to any other outside agency. This apart, we entertain reasonable doubt as to how far in a water sports complex presently existing in the Nuanai river, the use of the river throughout the day and night is really required.
13. The above apart, change of Government policy has to be for public good, the same has to be reasonable and must advance the larger public interest. We do not think if in the present state of our economy where a large segment of the society lives below the poverty line, denial of fishery sairat to genuine fishermen who earn their livelihood by fishing can really be said for public good, the profit to be earned by an individual cannot override the larger interest of the society. In so far as reasonableness is concerned, we have already adverted to this matter by referring to what was stated in Kasturi Lal. Advancement of social and economic justice is the sine qua non of reasonableness as that is consistent with the idea cherished in the Directive Principles Social and economic justice do require that those who are down-trodden are given ample opportunities to improve their lot. Denial of the means of livelihood to them would be denial of social and economic justice. In so far as public interest is concerned, there is no doubt that earning of foreign exchange by alluring foreign tourists is a national demand especially in these days of foreign exchange crisis; but then, whether the idea of earning foreign exchange at the cost of starving the poor can receive judicial approval is a matter on which there can be two opinions. We do not propose to say more than this at this stage as this matter shall really come up for examination once the Government decides as a matter of policy to give the fishery sairat in question to Toshali Sands to enable it to develop the water sports complex.
14. Another point emphasised by Shri Rath is that the fishery sairat had virtually stood extinct and the facts of the present case would show that the sairat was treated as non-existent. In so far as the power of the Government to extinguish the sairat source is concerned, reference has been made to Rule 49 of the Manual of Tahsil Accounts published by the Board of Revenue, Orissa. We do not deny this power to the Government but on the facts of the present case, it cannot be held that the fishery sairat must be treated to be non-existent inasmuch as from Annexure-7 it clearly appears that the leasing out of the water sports complex to opp. party No. 5 included the fishery sairat.
15. The learned counsel for opp. party No. 5 is at pains to submit that co-operative societies cannot claim preference in claiming settlement of fishery sairat and in this connection reference has been made to G. O. No. 38471-R dated 17th June, 1966 in which it was stated that no preference need be shown to the co-operative societies while settling fisheries, which should be put to public auction and settled in favour of the highest bidder or any other bidder in the auction as decided by the confirming authority under the usual rules regulating disposal of sairats. As to this. G. O., we would say that the same stood superseded by a later decision of the Government reflected in G. O. No. 36773-R, dated 27th June, 1974 (Annexure-4), in which it was stated that after careful consideration of the whole question relating to the principles of settlement of fisheries, it was decided that fishery sairats' sources in the State should ordinarily be settled in favour of bona fide co-operative societies consisting of genuine local fishermen. Paragraph 4 of this G. O. has clarified that where there are more than one cooperative societies of fishermen in the same area staking their claim, settlement should be finalised on the basis of limited auction to be held only among such co-operative societies fixing the minimum or off-set price in the manner laid down. As already pointed out, this Government Order of 1974 issued by the Revenue Department was accepted to be holding good even by 2-7-1990 (Annexure-10) even while granting settlement of fishery sairats by the Irrigation Department. There is thus no getting out of the position that the Government policy as on date is to grant fishery sairats ordinarily to bona fide co-operative societies consisting of genuine local fishermen.
16. The last attempt to persuade us not to disturb the Government Order granting the sairat in favour of opposite party No. 5 is on the ground that if this opposite party is allowed to enjoy the sairat in conjunction with the lease of the water-spread area, revenue of the Government would be increased to a considerable extent. In his written note, Shri G. S. Rath has given an estimate of the revenue which is likely to be earned by the Government because of the direct and Indirect benefits from the proposed water sports complex. According to this estimate, apart from the fixed revenue of Rs. 27,500/-, toll tax from the foreigners for entry into the reserved forests, which is at the rate of Rs. 5/- per trip, would yield an annual income of Rs. 78,800/- as the number of estimated tourists per year is 14,760. In this context, we may point out that in the year 1989-90, the water sports complex was leased out to opp. party No. 5 for a sum of Rs. 25,000/- and Dusasan Pradhan had been given the fishery sairat for Rs. 11,506/- and the cashew plantation for Rs. 7,320/-. As such, the total revenue derived by the State in 1989-90 from these different sources was about Rs. 44,000/- whereas in 1991-92 the total revenue to be derived from these sources is Rs. 27,000/-. The revenue from toll tax depends upon the flow of tourists. From the materials placed before us, we are not satisfied if granting of the fishery sairat to an outside agency is likely to impede the flow of tourists in near future. Indeed, the booking position of the Villa and the cottage is reflected in Annexure-H/5 as on 19-9-1991 indicates near full booking upto April, 1992. It is then mentioned in this statement that 350 local persons could receive employment whereas if the sairat were to be given to the co-operative society, only 10 to 15 persons would be employed. As to those figures, we would say that even if the estimate given by Shri Rath be accepted as based on reality, the same has intimate connection with the direct and indirect benefits on the proposed water sports complex. We are not satisfied if carrying on of fishing operations during night in the river would in the immediate future effect the potential growth of the water sports complex. According to us, the water sports complex can grow along with the fishing operations as was the view taken by this Court in O. J. C. No. 2016 of 1989. As in the present case we are concerned with settlement of the fishery sairat only for one year, namely, 1991-92, we do not think if grant of the same in favour of the co-operative society, for which sate notice had been issued as per Annexure-11, could have realty stood in the way of development of the water spoils complex. Further, increase in the revenue due to visit to there serve forest and employment of 350 local persons are mere conjectures. This apart, we have no convincing materials before us to be satisfied that the water sports are played during night also and as such, if fishing is done in the night, the same would affect development of the water sports. Indeed, if that would have been the idea of the Government, it would have altogether stopped settlement of fishery sairat. There is no justification in giving the sairat to Toshali Sands in preference to the genuine local fishermen who would have earned their livelihood if the same had been settled with them. The contention of Shri G. S. Rath that there are other fishery sairats also and the petitioner or the intervenor should not have any charm for this sairat in particular has also no persuasive force inasmuch as fishery sairats according to the policy have to be settled with the local fishermen. The members of the petitioner-society cannot perhaps claim settlement of a fishery sairat which is beyond its area of operation.
17. All told we would hold that granting of the Nuanai fishery sairat to Toshali Sands was neither legal nor justified. We would, therefore, set aside the settlement of the said fishery sairat in favour of Toshali Sands. We would also direct the authorities to settle this sairat in accordance with the principles mentioned in the Revenue Department Circular No. 36773-R, dated 27-6-1974 which are to operate for grant of fishery sairats under the Irrigation Department also as accepted in Annexure-10. The settling authorities would only permit the bona fide co-operative societies consisting of genuine local fishermen to take part in the auction as required in para 4 of the aforesaid Revenue Department's circular. We have given this direction because we find that apart from the petitioner society, the intervenor-society is also claiming settlement of the fishery sairat in question. May we state here that the legality of confining the settlement to bona fide co-operative societies consisting of genuine local fishermen has been upheld by this Court in Sudhir Chandra Mandal v. State of Orissa, AIR 1989 Orissa 70, by distinguishing the case of. Hrudananda Patra v. Revenue Divisional Commissioner, AIR 1979 Orissa 13, wherein creation of monopoly by administrative order was held to be violative of Article 15(1)(g) of the Constitution. In Sudhir Chandra Mandal, settlement of fishery sairats with co-operative societies was held to be net an action creating monopoly because of which the decision in Hrudananda patra was held to be not applicable. Necessary steps by the settling authorities for auction of the sairat in question shall be taken within a period of one month from today and the operation of the fishing right shall be limited from 7.00 p.m. to 5.30 a.m., as was the arrangement made after the decision of this Court was rendered in OJC No. 2016 of 1989. The water sports complex activity would be allowed to be carried on between 6.00 a.m. and 6.30 p.m.
18. In the result, the petition is allowed with the aforesaid observations and directions. In the facts and circumstances of the case we leave the parties to bear their own costs.
19. The delay in delivery of the judgment has occurred because after the hearing of the case was over on 27-9-1991, one of us Hon'ble Jagadeb Roy, J. had to remain absent from the Court from 8th October. In the meantime, the Puja holidays intervened and Hon'ble Jagadeb Roy, J. joined the Court on 6th November.
K.C. Jagadeb Roy, J.
I agree.