6th KIIT Petitioner

THE6th
1ST MKIIT DEVI MEMORIAL

NATIONAL
RINALINI MOOTNATIONAL
COURT MCOMPETITION
OOT COURT COMPETITION
2018
TEAM CODE: 636
6th KIIT NATIONAL MOOT COURT COMPETITION, 2018
IN THE MATTERS OF:
M/S MERCURY ...PETITIONER
V.
AIRPORT AUTHORITY OF MALGUDI ...RESPONDENT
ON SUBMISSION TO HON’BLE HIGH COURT OF MALGUDI
WRITTEN SUBMISSIONS ON BEHALF OF PETITIONER
COUNSEL ON BEHALF OF PETITIONER
1 i
MEMORIAL ON
MEMORIAL ONBEHALF
BEHALFOF
OFTHE
THEPETITIONER
PETITIONER
6th KIIT NATIONAL MOOT COURT COMPETITION 2018
TABLE OF CONTENTS
 LIST OF ABBREVIATION……………….........................…….............................................................................................................3
 INDEX OF AUTHORITIES……………………………………………………………………………………..….………......................5
 STATEMENT OF JURISDICTION……………………………………………………………..…………………………...................7
 STATEMENT OF FACTS…………………………………………………………………………..…………………….………….....8
 ISSUES RAISED………………………………..………………………………………………………………………………….….....10
 SUMMARY OF ARGUMENTS…………...………………………………………………………………………….…….……….....11
 ARGUMENTS ADVANCED………………………………..………………….....................................................................................13
1. Whether the petition filed before the Hon’ble court is maintainable or not?
2. Whether the Arbitration Agreement is onerous or not?
3. Whether there is concealment of fact or not?
4. Whether there should be compensation for loss of opportunity or not?
1 PRAYER……………………………………………………………………………………………………………………………..…..18
2
MEMORIAL ON BEHALF OF THE PETITIONER
TABLE OF ABBREVIATIONS
& And
AIR All India Report
Anr. Another
Art. Article
Co. Corporate
C.o.I Constitution of India
CPC Civil Procedural Code
Ed. Edition
Hon’ble Honorable
I.C.A Indian Contract Act
i.e. That is
Ltd. Limited
NOC No Objection Certificate
Ors. Others
S. Section
SC Supreme Cases
3
SCC Supreme Court Cases
Ss. Sections
Sq. m. Square metre
Cal. Calcutta
U.o.I. Union of India
v. versus
4
INDEX OF AUTHORITIES
CASES
1. Ramendra Kishore Biswas v. State of Tripura (1999) 1 SCC 472: (AIR 1999 SC 294)
2. P. Anand Gajjapati Raju v. P.V. G Raju
3. Jabrail Miyan and Anr. v. Lalu Turi and Ors.
4. Ganga Prasad v. Munnalal
5. Union of India v. Bharat Engineering Co.
6. Oriental Insurance Company Ltd. v. M/s Narbheram Power and Steel Ltd.
STATUTES
7. THE CONSTITUTION OF INDIA, 1950
8. CIVIL PROCEDURAL CODE, 1908
9. ARBITRATION AND CONCILIATION ACT,1996
10. INDIAN CONTRACT ACT, 1872
LEGAL DATABASE
1. MANUPATRA
5
2. SCC ONLINE
3. INDIAN KANOON
4. CASE MINE
BOOKS REFERRED
1. V.N. SHUKLA’S CONSTITUTION OF INDIA 12TH EDITION
2. DURGADAS BASU’S COMMENTARY ON THE CONSTITUTION OF INDIA (8TH EDITION) [VOL.-2,4,8,10]
3. DR. S.C. TRIPATHI’S ARBITRATION AND CONCILIATION ACT, 1996
4. S.R. MYNENI’S INDIAN CONTRACT ACT, 1872
LEGAL DATABASE
 Manupatra www.manupatrafast.com
 SCC Online www.scconline.com
 Advocate Khoj www.advocatekhoj.com
 Live Law https://www.livelaw.in
 Indian Kanoon https://www.indiankanoon.org
STATEMENT OF JURISDICTION
6
It is humbly submitted before the High Court of Malgudi that Hon’ble Court has original jurisdiction under which the case has been filed
under Art. 226 of the Indian Constitution.
226. Power of High Courts to issue certain writs
(1) Notwithstanding anything in Article 32 every High Court shall have powers, throughout the territories in relation to which it exercise
jurisdiction, to issue to any person or authority, including in appropriate cases, any Government, within those territories directions, orders or
writs, including writs in the nature of habeas corpus, mandamus, prohibitions, quo warranto and certiorari, or any of them, for the enforcement
of any of the rights conferred by Part III and for any other purpose
(2) The power conferred by clause ( 1 ) to issue directions, orders or writs to any Government, authority or person may also be exercised by any
High Court exercising jurisdiction in relation to the territories within which the cause of action, wholly or in part, arises for the exercise of such
power, notwithstanding that the seat of such Government or authority or the residence of such person is not within those territories
Therefore the Hon’ble High Court has jurisdiction to entertain the present case.
7
STATEMENT OF FACTS
1. In January 1, 2017 the airport authority of Malgudi issued a tender for managing the public parking space for vehicle commuting
passenger to the airport. There was a public notice issued for inviting for a public bid for a tender of 5000sq.m. of land. It was stipulated
that the project would be given to the highest bidder on may 2017, m/s mercury parking inc. was awarded the tender for a period of 3
yrs. As they made a bid of 25 lacs per month as a license fee and both parties entered into a contract.
2. In January 2018, it came to the notice of mercury that certain construction work has started by the NHA on the portion of land over 2000
sq.m., allotted by airport authority to them. Mercury filed a RTI through one its authorized representative to get detail of the
construction activity. Pursuant to the RTI query mercury was shocked after the response stating that the NOC for the area of 2000 sq.m
of land was given by airport authority to NHA in 2016.
3. In March 2018 mercury wrote a letter to the airport authority asking for the reduction in license fees of 25 lacs /month as it was quoted
for land of 5000 sq.m but the land was reduced to 3000 sq.m. So, there should be a reduction in license fees and it would also affect the
revenue flow of mercury. From the month of March 2018 mercury stopped paying payments as they did not received any kind of reply
from airport authority.
4. On May 2018 mercury invoked the arbitration agreement for the resolution of dispute and requested the airport authority to appoint an
arbitrator. The airport authority replied stating that to invoke the arbitration agreement all dues of the license agreement has to be
deposited for the appointment of arbitrator.
5. During this period mercury was disqualified in another tender issued by the airport authority in the state of Arkham. The disqualification
was due to the tender term of the project in Arkham. As it was that this disqualification was due to the pending dues of mercury in the
tender of 2017.
6. On 26 July, 2018 mercury filed a civil suit before the High Court of Malgudi which had original jurisdiction. Their basis of the suit was
that the entire contract was violated by fraud, it was submitted that the license built was made for the land of 5000 sq. m. of land which
8
will be awarded to the successful bidder to generate revenue. It was also submitted by mercury that the NOC was granted to NHA by
Airport Authority in 2016, which was prior to the invitation of tender and mercury is entitled to the damages as a result of the fault
committed by the airport authority.
7. The airport authority stated in its defense that due to the presence of the arbitration clause in the license agreement this case should be
referred to the arbitration, they further stated that as per the arbitration clause the dues need to be paid to refer this dispute to
arbitration.
8. Additionally, it was stated by the airport authority that any reduction in the license fee could only take place through new tender. Airport
authority also stated that, the NOC was given in 2016 and it did not mean that the portion of land was acquired by the NHA at that time.
9. Mercury further contended that the arbitration clause was made to deter any party to initiate arbitration. Mercury claimed the damage
for the loss of opportunity as they were disqualified from the tender of the state of Arkham.
9
ISSUES RAISED
[ISSUE 1]
WHETHER THE PETITION IS MAINTAINABLE BEFORE THE HON’BLE COURT OR NOT?
[ISSUE 2]
WHETHER THE ARBITRATION AGREEMENT HAS ONEROUS CLAUSE OR NOT ?
[ISSUE 3]
WHETHER THERE WAS CONCEALMENT OF FACT OR NOT?
[ISSUE 4]
WHETHER THERE SHOULD BE COMPENSATION FOR LOSS OF OPPORTUNITY?
10
SUMMARY OF ARGUMENTS
[ISSUE I]
It is humbly submitted before the High court of Malgudi that the Hon’ble Court has original jurisdiction under which the case (i.e. Airport
Authority of India v. M/s Mercury) has been filed under Art. 226(2) of Indian Constitution.
[ISSUE 2]
WHETHER THE ARBITRATION AGREEMENT HAS ONEROUS CLAUSE OR NOT?
It is humbly submitted before the Hon’ble High Court of Malgudi that as per the license agreement the arbitration clause said:-
“In case of any dispute between the parties the dispute will be referred to an arbitrator to be solely appointed by the Airport Authority. As a
condition precedent to the appointment of an arbitrator, the licensee will deposit any amount due to the licensor under the license agreement.”
It can be seen that from the above that this arbitration agreement is void as it lacks mutuality in it.
[ISSUE 3]
It is humbly submitted before the Hon’ble High Court of Malgudi that the tender for which the notification was released on JANUARY 2017 for
the Parking Space for area of 5000 Sq.M. For which the Applicant i.e. M/S Mercury bided INR 25 LAKH per annum as the fee for parking
management but it was no where mentioned that National Highway Authority i.e. NHA has already obtained a No Objection Certificate i.e.
NOC for area of 2000Sq.M. for the road construction. This falls under Section 17(2) of Indian Contract Act, 1872.
[ISSUE 4]
WHETEHER THERE SHOULD BE COMPENSATION FOR LOSS OF OPPORTUNITY?
It is humbly submitted before the Hon’ble High Court of Malgudi that the Applicant i.e. M/S Mercury was wrongfully eliminated from the
tender process of Airport Authority of Arkham on the ground of Pending Dues in Malgudi. For the above mentioned the Applicant M/S Mercury
11
had tried to invoke Arbitration and also wrote letter to the Airport Authority in Malgudi regarding the same thus, it was a clearly the fault of
Airport Authority because of which the Applicant i.e. M/S Mercury has suffered huge Financial Damage for which the Respondent i.e. Airport
Authority is single handedly responsible thus, they liable to pay damages.
12
ARGUMENT ADVANCED
[ISSUE 1]
As per the definition of Article 226 (2) the Hon’ble High Court of Malgudi has jurisdiction to try this case in High Court of Malgudi. As it was
stated by Hon’ble Supreme Court stated that :-
“The SC concluded International Airport Authorities undoubtedly an instrumentality or agency of the Central Government and falls within the
definition of ‘State’. The Court went on to conclude that just as Government acting through its officers, is subject to constitutional and public
law limitations, similarly Government acting through agency is subject to equal restrictions. Therefore, the International Airport Authority of
India is subject to the limiting or restricting provisions of the Constitution and other public laws.”10
In this case of Ramana Dayaram Shetty v. The International Airport Authority, the Hon’ble Supreme Court also mentioned:-
“The Court enumerated the following five factors which would determine whether a body comes under the definition of State as defined in
Article 12 of the Constitution:
 Financial assistance given by the State and magnitude of such
 Any other forms of assistance whether of the usual kind or extraordinary.
 Control of management and policies of the corporation by the State – nature and extent of control.
 State conferred or State protected monopoly status and
 Functions carried out by the corporation, whether public functions closely related to governmental functions, would determine whether a
corporation is an instrumentality or agency of the State or not.”
10
Ramana Dayaram Shetty v. The International Airport Authority AIR 1979 SC 1628.
13
If we compare these five points with the Airport Authority then we can reach to a conclusion that the Airport Authority of Malgudi was also
regulated by state. Hence, it can be said that The Airport Authority of Malgudi too is a agency of the Central Government and falls within the
Definition of ‘State’11 .
A. The Petitioner has Locus Standi to Approach the Hon’ble High Court:-
It is humbly submitted before the Hon’ble High Court of Malgudi that the Applicant i.e. M/S Mercury had the right to bring this civil infront of
the Hon’ble High Court of Malgudi as to issue order against Airport Authority (as it was considered to be agency of the Central Government).
To regulate the Onerous Clause of the Arbitration in the License Agreement of the Parking Space. In the case of Ramendra Kumar Biswas v.
State of Tripura Hon’ble Supreme Court stated that :-
“Service rules neither expressly nor by implication have taken away jurisdiction of Civil Courts to deal with service matters. It is a different
matter to insist that departmental remedies should be exhausted before a person approaches the Civil Court; but it cannot be held that the Civil
Court has no jurisdiction”12.
In the above mentioned case the Hon’ble Supreme Court of India has mentioned that :-
“Person can bring such suit before Civil Court if he deems fit to go to the Civil Court rather than going for the Arbitration”.
[ISSUE 2]
WHETHER THE ARBITRAION AGREEMENT HAS ONEROUS CLAUSE?
It is humbly submitted before the Hon’ble High Court of Malgudi that as per the license agreement the arbitration clause said :-
“In case of any dispute between the parties the dispute will be referred to an arbitrator to be solely appointed by the Airport Authority. As a
condition precedent to the appointment of an arbitrator, the licensee will deposit any amount due to the licensor under the license agreement.”
11
Definaton of Article 12 of The Constitution of India, 1950.
12
Ramendra Kishore Biswas v. State of Tripura (1999) 1 SCC 472 : (AIR 1999 SC 294).
14
It can be seen from the above paragraph that there is no Mutuality given in the Arbitration Agreement as it states that:-
“In case of any dispute between the parties the dispute will be referred to an arbitrator to be solely appointed by the Airport Authority.”
It is can be seen that this part of The Arbitration Agreement talks about the Appointment of Arbitrator by them. As per the Opinion of Hon’ble
Supreme Court in the case of Union of India v. Bharat Engineering Corporation was :-
“An arbitration agreement should show bilateral rights of reference to the parties that means either of the party should have right of reference to
arbitration in case of dispute or difference arising between the parties”13
In the Arbitration of Arbitration Clause of the license agreement it was said that :-
“As a condition precedent to the appointment of an arbitrator, the licensee will deposit any amount due to the licensor under the license
agreement.”
In this case it can be seen in the facts of the case that the Airport Authority the payment of land of 5000 square meter but in reality there was
land of 3000 square meter used to collect the revenue after in January of 2018 when the NHA started certain Construction work on the land of
area of 2000 square meter as it was allotted to mercury under the tender of 2017.
It can be seen that from the above that this arbitration agreement is void as it lacks mutuality of reference in the Arbitration Clause.
[ISSUE 3]

It is humbly submitted before the Hon’ble High Court of Malgudi that the tender for which the notification was released on January 2017 for the
Parking Space for area of 5000 Sq.m. For which the Applicant i.e. M/S Mercury bided INR 25 LAKH per annum as the fee for parking
management but it was no where mentioned that National Highway Authority has already obtained a NOC for area of 2000Sq.m. for the road
construction. This falls under Section 17(2) of Indian Contract Act, 1872.
The section 17 of Indian Contract Act, 1872 states that :-
“‘Fraud’ means and includes any of the following acts committed by a party to a contract, or with his connivance, or by his agent1, with intent
13
Dr. S.C. Tripathi Arbitration and Conciliation Act, 1996
15
to deceive another party thereto or his agent, or to induce him to enter into the contract:”
And the definition of Section 17 (2) of Indian contract Act is:-
“The active concealment of a fact by one having knowledge or belief of the fact”
In the case of Jabrail Mian and Anr v. Lalu Tori and Ors. the section 17 was explained as:-
“Section 17 of the Indian Contract Act, 1872 defines "fraud" and it includes such act which intends to deceive another party and also any other
act fitted to deceive. In other to constitute fraud, such acts should have been done by the party to the contract or by any other person with his
connivance and with intent to deceive the other party to enter into the contract. The party so aggrieved can avoid the said contract on the
ground of fraud. ”14
In the case of of Ohid Bux and Ors. v. Dorshu and Anr.15, it has been observed which runs thus:--
"It is a well recognized principle of the law of contract that if you seek on the ground of fraud to cancel or set aside the contract you must set
aside the contract as a whole and not a part thereof, that is to say, the person impeaches the contract must make up his mind to take it as it
stands or repudiate it to toto. It is open to the plaintiffs to take a middle course to accept a contract in part and to reject the other part."
It can be seen that this contract was made by concealment of fact which was not highlighted during the contract of tender or when the
notification of tender. The information which was concealed by the airport authority was :
“The Airport Authority has given a NOC to National Highway Authority for area of 2000 sq.m. for certain construction purpose.”
Thus it is clearly favourable to the discussed arguments that the respondent concealed a important fact which led to fraud & leading to the
conditions of void contract.
[ISSUE 4]
WHETHER THERE SHOULD BE COMPENSATION FOR LOSS OF OPPORTUNITY?
14
Jabrail Mian and Anr v. Lalu Tori and Ors. AIR 2004 Jhar 139, 2004 (3) JCR 139 Jhr.
15
, AIR 1926 Cal 959
16
It is humbly submitted before the Hon’ble court that respondent was wrongfully eliminated from the tender process of airport authority of Akram
on the ground of pending dues in Malgudi. The respondent had tried to invoke arbitration and also wrote letter to the airport authority of Malgudi
regarding the same thus it was a clear fault by the airport authority because of which the appellant has suffered huge financial damage due to the
actions of airport authority, who is single handedly responsible and are liable to pay damages to the appellant, which are caused by concealment
of fact. The party who is injured by the breach of contract may bring an action against for the damages. The term ‘Damages’ means
compensation in term of money for the loss suffered by the injured party. Burden lies on the injured party to prove his loss.
PRAYER
17
In the light of the issues raised, arguments advanced and authorities cited, may this Hon’ble Court be pleased to:
 Declare that the Petition filed by the petitioner is maintainable.
 Hold that Arbitration Agreement has Onerous Clause.
 Hold that there are concealment of fact
 Hold that there should be compensation for loss of opportunity.
And Pass any other Order, Direction, or Relief that it may deem fit in the Best Interests of Justice, Fairness, Equity and Good Conscience.
And for this, the Respondent as in duty bound, shall humbly pray.
Counsel on Behalf of Petitioner
18

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6th KIIT Petitioner

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THE6th

1ST MKIIT DEVI MEMORIAL

TEAM CODE: 636

6th KIIT NATIONAL MOOT COURT COMPETITION, 2018

IN THE MATTERS OF:

M/S MERCURY ...PETITIONER

AIRPORT AUTHORITY OF MALGUDI ...RESPONDENT

ON SUBMISSION TO HON’BLE HIGH COURT OF MALGUDI

WRITTEN SUBMISSIONS ON BEHALF OF PETITIONER

COUNSEL ON BEHALF OF PETITIONER

 Financial assistance given by the State and magnitude of such

 Any other forms of assistance whether of the usual kind or extraordinary.

 State conferred or State protected monopoly status and

WHETHER THERE WAS CONCEALMENT OF FACT OR NOT?

Counsel on Behalf of Petitioner

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