Supreme Court Closes Curative Petitions Of Union & AAI On GMR- Nagpur Airport Issue After SG Says They Aren't Maintainable

The Supreme Court on Friday (September 27 ) closed the curative petitions filed by the Union Government and the Airports Authority of India (AAI) against a judgment allowing GMR Group the operational management rights of Nagpur's Babasaheb Ambedkar International Airport.

The Court closed the curative petitions after Solicitor General of India Tushar Mehta, in his personal capacity, opined that no ground for the exercise of the curative jurisdiction was made out within the parameters of the Rupa Ashok Hurra v. Ashok Hurra judgment.

Earlier, the Court had sought the views of the Solicitor General regarding the maintainability of the curative petition. Today, the SG said that it was his personal view that the curative petitions were not maintainable. He clarified that his submission was not based on any consultation with the Union Government.

"Strictly speaking, my personal view is that this may not fall within Rupa Ashok Hurra parameters. There are three categories earmarked - (a) bias, (b) lack of hearing, (c) similar analogous grounds. These proceedings can't be made into an intra-court appeal in disguise. So far as hearing is concerned, we were heard. I must own my decision, there was an opinon given earlier by some other counsel, not the counsel who are appearing now, hinting at the second ground of bias. But it is my professional judgment that it is not a case of bias. I cannot raise that ground of bias. Nobody can raise that," SG submitted.

SG however requested the Court to clarify the observation made by the High Court that in such kind of contracts, the Union of India or the AAI are not necessary parties, saying that it might impact other contracts. The Court agreed to clarify that this observation of the High Court can't be read as a correct statement of law.

The bench comprising Chief Justice of India DY Chandrachud, Justices Sanjiv Khanna, BR Gavai and JK Maheshwari recorded the SG's statement and closed the matter.

"On the previous occasion, this Court had requested the learned Solicitor General to dispassionately apprise this Court as to whether the ground which has been raised by the Union Government in the curative petition would fall within the ambit of the decision in Rupa Hurra v. Ashok Hurra. The Solicitor General was also requested to apprise this Court as to whether in the considered view of the Union Government, it would want to pursue these proceedings.

Mr.Tushar Mehta, the learned Solicitor General, has submitted in the course of the hearing today that while the Union of India had initially intended to pursue certain issues in the curative petitions, in his professional judgment, the issues which are sought to be raised in the curative petition do not fall within the three-fold parameters of Rupa Hurra.

The learned SG has however submitted that this Court may issue a clarification as regards the findings in paragraph 51 of the impugned judgment to the effect that in such matters, neither the Union of India nor the AAI are necessary parties. The SG submits that if the above statement of law is to continue to hold the field in future, certain difficulties may be encountered by the Union of India and the Airports Authority of India in future litigations. We find the above approach of the Solicitor General to be fair. Based on the statement of the Solicitor General, we record that the curative petition is not pressed before this Court. However, it is clarified that the observation in paragraph 51 of the impugned judgment to the effect that neither the Union of India nor the Airports Authority of India are necessary parties to such proceedings would not be reflective of the correct position of law and the issue is left open to be decided in an appropriate case to be decided in future."

Background

The genesis of this legal dispute is a Bombay High Court ruling upholding GMR's right to operate the airport, a decision that was affirmed by the Supreme Court in May 2022. Subsequently, the AAI attempted to challenge this verdict by filing a review petition which was dismissed in May last year.

The heart of the matter revolves around the Nagpur Multimodal International Hub Airport (MIHAN) project, designed to transform the Dr Babasaheb Ambedkar International Airport into a pivotal air cargo and passenger hub. GMR secured the operation rights initially, emerging as the highest bidder. However, later concerns arose regarding the revenue-sharing arrangement, particularly in light of the civil aviation ministry's apprehensions about MIHAN's low revenue realisation despite registering a significant profit in the subsequent fiscal year and projections of substantial passenger volume growth.

In response, GMR attributed the surge in the profit to an increase in the user development fee for improving passenger facilities. Yet, the impasse persisted, leading to GMR seeking court intervention for contract enforcement. However, before the court could adjudicate the matter, the state government in March 2020 invalidated the contract based on the recommendation of its Project Monitoring and Implementation Committee (PMIC), headed by the chief secretary.

Accordingly, by a March 2020 communication, the award granted to GMR Airports for upgrading and the operation of the airport was cancelled. However, in a major relief to the multinational conglomerate company, the Nagpur Bench of the Bombay High Court in August 2021 quashed this communication issued by MIHAN, a joint venture between Maharashtra Airport Development Company and the Airports Authority of India, calling it 'arbitrary' and 'unfair'.

This verdict by a division bench of Justices Sunil Shukre and Anil Kilor was upheld by a Supreme Court bench of Justices Vineet Saran and JK Maheshwari. Dismissing MIHAN's appeal, the top court in May 2022 held that the high court verdict contained sound reasoning and did not warrant interference. Last year, a review petition was also dismissed, with a bench of Justices Krishna Murari and JK Maheshwari noting, "We do not find any error in the order impugned, much less an apparent error on the face of the record, so as to call for its review. The review petition is, accordingly, dismissed."

Case : Airports Authority of India v. GMR Airports Limited & Anr. | Curative Petition (Civil) No. 198 of 2022