MHC says, no need for NOC as prerequisite for bar tenders, set asides bar closure order

CHENNAI: A division bench of the Madras High Court set aside a single judge order to close down the bars attached to the TASMAC and said no need of Non Objection Certificate (NOC) as a prerequisite while bidding bar tenders.

Tamil Nadu State Marketing Corporation (TASMAC) moved the Madras High Court seeking to set aside two single bench orders which directed to close down the bars attached to the TASMAC and directed to insist prerequisite NOC from the land owners of the bar to the applicants for the lease.

The appeal petition was listed before the first division bench of the Madras High Court (MHC) comprising Chief Justice S V Gangapurwala and Justice P D Audikesavalu.

The bench observed that insisting NOC from the owner of the bar premises before the applicant submitting his bid in the tender, is fraught with oblique motives.

It would be unrealistic to expect the owner of the bar premises to grant such NOC in writing to all potential bidders of such a bar before they submit their bid, the bench wrote.

"It would lead to an anomalous situation where participation in the tender would be confined only to the existing lessee or owner of the bar premises" observed the bench.

It would prevent the other bidders who are willing to make higher bids. Which would militate against public interest defeating the purpose of TASMAC granting the privilege to private individuals to run bars attached to its shops at competitive price to augment its income leading to formation of a cartel, which cannot be countenanced.

The bench also set the TASMAC at liberty to issue fresh tender for future periods.

The counsel for the TASMAC contended that the previous orders exceeded the scope of judicial review permissible in contractual matters pertaining to the State.

The petitioners are existing licensees of the bars who have an hidden agenda to indefinitely continue the business of running the bar without increasing the privilege fee, defeating public interest, argued the counsel.

After the submission the bench set aside two previous orders of the court and made it clear that NOC is not needed as a prerequisite for bidding bar tenders.