LexLALA RAM (D) BY L.R.. & ORS. versus UNION OF INDIA & ANR.
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[2013] 1 S.C.R. 577 LALA RAM (D) BY L.R.. & ORS. v. UNION OF INDIA & ANR. (Civil Appeal Nos. 243-247 of 2003) JANUARY 24, 2013 [DR. B.S. CHAUHAN AND V. GOPALA GOWDA, JJ.] A B Fee - Licence fee - Shops situated in a busy market of Old Delhi - Notice dated 7-8-1980 issued by the Railways Authorities enhancing licence fee in respect of the said shops c from Rs.21 per sq yards to Rs.270 per sq yards per annum - Representations thereagainst by the shop licencees (appellants) - Railway Administration, after considering the case of the appellants, passed order dated 25-5-1987 enhancing the license fee @ Rs.270 per sq. yards with 0 retrospective effect from 1-11-1980 - Writ petitions filed by the appellants - Dismissed by the High Court - On appeal, held: The enhanced license fee being 13 times, seems excessive, and though such observation was a/so made by the Railway Minister, but the enhanced license fee would be illusory when compared with the prevailing license fee in the said market E as applicable to private shops - A State instrumentality must serve the society as a whole, and must not grant unwarranted favour(s} to a particular class of people without any justification, at the cost of others - Merely because the appellants (shop licencees) have been occupying the shops F in question for a prolonged period of time, they cannot claim any special privilege - The enhanced license fee cannot be held to be unreasonable or arbitrary, and as warranting any interference by a court of equity- However, finding bf the High Court that the notice dated 7-8"1980 remained unchallenged G and therefore, application of order dated 25-5-1987 with retrospective effect was justified, not factually correct inasmuch as after receipt of notice dated 7-8-1980, appellants had made representations before the respondents-authorities 577 H 578 SUPREME COURT REPORTS [2013] 1 S.C.R. A raising all their grievances and certain interim relief was also granted pursuant to certain observations made by the Railway Minister - Thus, order dated 25-5-1987 should not be applied retrospectively - Enhanced license fee may be recovered from the appellants from the said date in accordance with law B - Interim order passed earlier vacated. Constitution of India, 1950 - Articles 38 and 39 - Welfare state - Meaning, features and obligations of - Discussed - Maxims - "Salus Populi Suprema lex". C The appellants were licensee of shops situated in a busy market of Old Delhi which were in their occupation since pre-independence. They were regularly paying license fee to the Railways. In 1977, the said licence fee was increased to Rs.21 per sq. yards per annum. The D appellants received a notice dated 7.8.1980 from the respondents-Railways Authorities, about increase in the licence fee from Rs.21 per sq. yards to Rs.270 per sq. yards per annum. Representations made by the appellants' association were considered by the Railway E Minister who observed that the auction of the said shops was not reasonable and also stated that the revision in license fee was excessive and expressed his opinion with respect to reconsidering the whole case and increasing the license fee by 5% to 10%. The Railway F Administration, after considering the case of the appellants, passed order dated 25.5.1987 to enhance the license fee @ Rs.270 per sq. yards with retrospective effect from 1.11.1980. Aggrieved with the notice dated 25.5.1987 and also the letter dated 29.7.1987, terminating G licences to operate the shops in question and to vacate the premises for failing to deposit outstanding dues on account of non-payment of licence fee, the appellants filed writ petitions before the High Court. The High Court dismissed the writ petitions and therefore the instant H appeals. LALA RAM (D) BY LR. & ORS. v. UNION OF INDIA & 579 ANR. The appellants submitted that once the enhanced A license fee had been disapproved by the Railway Minister and the matter was reconsidered in light of the observation made by the said Minister stating that the said enhancement was excessive and that the license fee could be enhanced by 5% to 10%, the notice impugned B was unreasonable and arbitrary. It was further submitted that being a welfare state, it is the duty of the State to provide shops at nominal license fee. Disposing of the appeals, the Court HELD: 1. In the case at hand, the enhanced license fee cannot be held to be unre
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