W.P.(MD). No. 1267 of 2011 and M.P.(MD). Nos. 1 and 2 of 2011. Case: R.K.S. Sivasankaran Vs The Managing Director, The Chief Accounts Manager-cum-Secretary, Tamil Nadu Tourism Corporation Ltd, Tamil Nadu Tourism Complex and The Regional Manager (Madurai), Hotel Tamil Nadu. High Court of Madras (India)
| Case Number | W.P.(MD). No. 1267 of 2011 and M.P.(MD). Nos. 1 and 2 of 2011 |
| Counsel | For Appellant: M. Mohideen Basha, Adv. And For Respondents: V. Raghavachari, Adv. |
| Judges | B. Rajendran, J. |
| Issue | Tamil Nadu Gambling Act; Immoral Traffic (Prevention) Act; Arbitration and Conciliation Act, 1996 - Section 5; Sale of Goods Act; Constitution of India - Article 226 |
| Judgement Date | April 20, 2011 |
| Court | High Court of Madras (India) |
Order:
B. Rajendran, J., (Madurai Bench)
1. The Petitioner is the franchisee for running the hotel units of the Tamil Nadu Tourism Corporation Ltd, Sattur, Virudhunagar District, on franchise basis. In this regard, an agreement has been entered into on 19.09.2007 for a period of fifteen years. The franchise fee for the said period was Rs. 2,70,000/-per annum with 15% escalation once in three years. The Petitioner would contend that the said hotel has been taken on contract by him and the same was managed by one Rajasekaran and the Petitioner is not aware of the happenings. Since the said premises was misused by the said Rajasekaran, it led to the registration of criminal cases against him and the Petitioner. The Respondent would contend that the Petitioner is vicariously liable for prosecution. In fact, the Petitioner along with Rajasekaran was booked under various offences for conducting the immoral trafficking and gambling and brothel in the hotel. But, the Petitioner would contend that he was physically not present at the time of occurrence and he was included for the reasons that he was a franchisee of the said hotel besides agreement stood in his name. Therefore, he would contend that the termination order dated 24.01.2011 terminating the franchisee agreement and ordered to hand over the hotel is illegal, arbitrary and violation of principles of natural justice. He would also contend that the said impugned order is passed without any notice to him and he has No. knowledge about the crime committed by the said Rajasekaran. Aggrieved against the action of the Respondents, the Petitioner is before this Court with the present Writ Petition.
2. The Respondents have filed a counter affidavit (vacate stay petition) in which they would contend that criminal cases have been registered against the Petitioner as well as the said Rajasekaran for the offences committed by them under the Tamil Nadu Gambling Act and Immoral Traffic (Prevention) Act. They would also contend that the Petitioner is responsible for the commission and omission of the action, where immoral activities had taken place in the hotel premises. As per Clause 29 of the agreement, the franchisee shall not undertake any immoral activity or malpractices in the hotel premises franchised by the Tamil Nadu Tourism Development corporation. Knowing full well, the Petitioner has committed serious crimes, that too, in the building owned by the Government, which has tarnished the image of the Respondents Corporation. As per the agreement, immediate action had to be taken, as serious crimes had been committed in the hotel premises and accordingly, it was taken by the Respondents. Therefore, the termination order is just and equitable and the Respondents have taken a decision in a judicious manner. Apart from that, as per Clause No. 35 of the agreement, in case of any dispute, the franchisor will refer the dispute to an Arbitrator in accordance with the provisions of the Arbitration and Conciliation Act,1996. Without invoking the arbitration, the Petitioner cannot straight away file a Writ Petition...
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