Case No: Civil Petition for Leave to Appeal No. 300 of 1995
Judge: Mustafa Kamal ,
Court: Appellate Division ,,
Advocate: Mr. Md. Aftab Hossain,Syed Ishtiaq Ahmed,,
Citation: 48 DLR (AD) (1996) 30
Case Year: 1996
Appellant: Hutchison Telecom Bangladesh Ltd.
Respondent: Bangladesh Telegraph and Telephone Board
Subject: Law of Contract, Telecom,
Delivery Date: 1995-6-5
ATM Afzal CJ
Mustafa Kamal J
Latifur Rahman J
Hutchison Telecom Bangladesh Ltd.
Bangladesh Telegraph and Telephone Board and others
June 5th, 1995.
Contract Act (IX of 1872)
In an appropriate case a Court of Law can apply and imply warranty, as distinguished from an express contract or express warranty, on the presumed intention of the parties and upon reason.
Case Referred To:
The Moorcock, (1886-90) All ER Rep. 530 and Koduri Krishnarao vs. State of Andhra Pradesh, AIR 1962 (Andhra Pradesh) 249.
Syed Ishtiaq Ahmed, Senior Advocate (Rafiq-ul Huq and Mahmudul Islam, Senior Advocates with him) instructed by Shamsul Haque Siddique, Advocate-on- Record— For the Petitioner.
TH Khan, Senior Advocate (AM Nooruddin Ahmed, Advocate with him), instructed by Md. Aftab Hossain, Advocate-on-Record — For the Respondents.
Civil Petition for Leave to Appeal No. 300 of 1995
(From the Judgment and Order dated 8.5.95 passed by the High Court Division in Writ Petition No. 1321 of 1994).
The petitioner-company obtained a Rule Nisi in Writ Petition No. 1321 of 1994 calling upon the respondents to show cause why the notice contained in a Memo dated 25.7.94 issued by respondent No. 3 and published in the Financial Express dated 27.7.94 in so far as it relates to invitation of tender for establishment of Cellular Mobile Telephone Service in major cities and areas of Bangladesh should not be declared to be without lawful authority and of no legal effect and why the respondents should not be directed to cancel, rescind and /or withdraw the same. The Rule Nisi was discharged by a Division Bench of the High Court Division by judgment and order dated 8.5.95 from which the petitioner now seeks leave to appeal.
2. The short facts of the case are, that respondent No. 1, Bangladesh Telegraph and Telephone Board, shortly BTTB, entered into an agreement on 26.7.89 with a private limited company named Bangladesh Telecom (Pvt) Ltd, shortly BTL, permitting BTL to operate several telecommunication systems including Cellular Mobile Telephone Service in the private sector. Eight months thereafter, i.e. on 25.3.90 BTTB issued, being empowered by the Government to do so under the Bangladesh Telegraph and Telephone Board Ordinance, 1979, a licence under section 4(1) of the Telegraph Act, 1885 providing in clause (2) that the licence was to remain valid and operative for 20 years from the date of signing of the agreement, i.e. from 26.7.89 and also providing in clause (3) that BTL would have exclusive right of operation of the aforesaid communication systems for a period of 5 years from the same date. BTL implemented three communication systems with its own finance, but it had to seek foreign parties for installation and operation of Cellular Radio Telephone Service as it required huge investment in foreign exchange and local currency beyond its capacity. A Memorandum of Understanding was signed between BTL and Hutchison Telecommunication Ltd, a foreign company, to form a joint venture with BTL for the purpose. BTL approached the Board of Investment of Bangladesh in 1989 for approval of the joint venture company. The Board of Investment by Memo dated 11.8.90 approved the joint venture company with 50% foreign ownership in the project. Accordingly the petitioner-company, namely, Hutchison Bangladesh Telecom Ltd. shortly HBTL, was incorporated on 8.10.90 under the Companies Act, 1913 with BTL and Hutchison Telecommunication (Bangladesh) Ltd, a subsidiary of Hutchison Telecommunication Ltd. holding 50% shares each. The petitioner company through BTL imported necessary equipment and made necessary constructions for making the cellular radio telephone system operative by January, 1991. It was necessary to connect the exchange established by the petitioner with the exchange of BTTB through a Public Switch Telecommunication Networks (PSTN) connection. BTL applied for PSTN connection and BTTB issued a demand note on 5.5.9 1 for payment of nearly Taka 41 lakh toward charges of PSTN connection. The petitioner made arrangement for payment of the amount which was paid to BTTB through BTL on 25.5.91 But BTTB did not give the necessary connection and thereby prevented the system from being commercially operational. The petitioner met the officers of BTTB and had the impression that for reasons best known to them BTTB would not permit BTL to operate the cellular radio telephone system. At this stage the representative of the foreign share-holders of the petitioner met the Minister- in-Charge and offered to come to any arrangement with the Government and BTTB. BTL was asked by BTTB by a notice dated 12.1.92 to show cause why the agreement dated 26.7.89 would not be amended and cellular radio telephone system should not be excluded from the agreement, as in violation of clause 17 of the agreement BTL without taking prior permission from BTTB was installing the cellular radio telephone system in collaboration with a foreign company. BTL showed cause vide letter dated 19.1.92 stating that the system was not fully operational and that the stage had not arrived for obtaining permission of BTTB for transfer of licence in favour of the petitioner. Eventually BTTB issued Memo dated 31.3.92 under section 8 of the Telegraph Act cancelling the agreement dated 26.7.89 for violating the terms of clauses 3, 6, 7, 9, 17 and 23 of the agreement. BTL filed Writ Petition No. 1286 of 1992 challenging the validity of the Memo dated 31.3.92. The High Court Division by judgment and order dated 18.8.92 declared that the cancellation of the agreement so far as it related to the systems other than the cellular radio telephone system was not in accordance with law and made the Rule absolute in this regard, but discharged the Rule insofar as the cellular radio telephone system is concerned. BTL took an appeal to this Division and by judgment and order dated 19.4.93 passed in Civil Appeal No. 73 of 1992 the decision of the High Court Division was reversed so far as it related to cellular radio telephone system. The appeal of BTL was allowed subject to the conditions that BTL shall apply for written permission of BTTB for transfer of the licence in respect of cellular radio telephone system in favour of the petitioner company within two months from date and operation of the said system by the petitioner- company within one month thereafter, failing which BTTB shall be free to take such steps with regard to the licence as it will be advised.
3. Accordingly, BTL applied for on 16.6.93 and obtained on 11.7.93 from BTTB permission to transfer the licence in respect of Cellular Radio Telephone in favour of the petitioner-company and transferred the licence on 12.7.93 to the petitioner-company. BTTB gave PSTN connection on 3.8.93 and the cellular radio telephone system became operational on and from 8.8.93. It is the case of the petitioner-company that by publishing the impugned notice dated 27.7.94 in the Financial Express BTTB acted contrary to the terms of the licence. The licence, according to the petitioner, became effective on 3.8.93 as BTTB willfully, deliberately and illegally withheld the PSTN connection until it was compelled to give the connection on 3.8.93 under the order and direction of the Appellate Division. The period from 25.5.91 to 3.8.93 ought to be excluded from the computation of the period of 5 years during which the petitioner-company would enjoy the exclusive right of operating the said system in Bangladesh as the petitioner was deprived of the time lost owing to the wrong committed by BTTB in canceling the licence. The invitation of tender on 27.7.94 was in the circumstances illegal and unlawful.
4. BTTB in its affidavit-in-opposition contended that under clause (3) of the licence the petitioner would have exclusive right of operation for 5 years with effect from the date of signing of the agreement, namely, 26.7.89. After installation of all machineries BTTB found that BTL was not acting as per contract and this was conveyed to BTL on 12.9.92. The system was operational by January 1991. A person having a cellular telephone could communicate with another person holding a cellular telephone. Communication to PSTN was only to facilitate communication between a cellular telephone-holder and a non-cellular telephone-holder BTTB also took other defences.
5. The High Court Division in discharging the Rule Nisi held that clause (3) of the licence confers upon BTL the exclusive right of operation of all the stipulated telephone services for a period of 5 years from the date of signing of the agreement, i.e. from the 26th July, 1989. The petitioner failed to show that this strict stipulation was subject to variation in any way by any of the parties under any circumstances or in any contingency whatsoever. It took note of the petitioner-company’s argument that all-important PSTN connection was not given on account of wrongful acts of BTTB, but it did not come to any finding that BTTB was responsible for any wrongful act and held that assuming that for acts of one of the parties the other party could not enjoy the fruit of the contract for a certain period, the deprived party does not acquire a right to get the period of exclusive operation of the licence extended thereby. An equitable right, it further held, cannot be claimed when the right arising out of a contract has ceased to exist in terms of the contract itself. High Court Division also rejected the contention of promissory estoppel.
6. Mr. Syed Ishtiaq Ahmed, learned counsel for the petitioner, submits that the High Court Division misappreciated the contention of the petitioner. The petitioner did not want and did not argue in favour of an extension of the period of exclusive operation of the licence it is purely a case, he submits, of construction of the licence to find out the manifest intention of the parties and to imply terms in accord with such intention to give business efficacy to the licence, a function which the Court can and ought to perform. The High Court Division asked a wrong question relating to extension of the period of exclusive operation in the licence and thus arrived at a wrong conclusion.
7. Mr. TH Khan, learned Counsel entering caveat on behalf of the respondents, submits that the end-result of what the petitioner wants is an extension of the period of exclusive operation of the licence, in whatever way the submission is couched .A written licence cannot be so varied, he submits.
8. In an appropriate case a Court of Law can apply and imply warranty, as distinguished from an express contract or express warranty, on the promised intention of the parties and upon reason the cases cited by Mr. Ahmed, namely, The Moorcock, (1886.90) AU ER Rep. 530 and that of Koduri Krishnarao vs. Slate of Andhra Pradesh, AIR 1962 (Andhra Pradesh) 249 are cases where the Court imported the doctrine of implied term to remedy some oversight and to save the contract from being wrecked unless the minimum implied term in the contract is supplied. In both the cited cases the defendants were in the wrong in some way or other.
9. There is no finding in the judgment of the judgment of the High Court Division that the failure of the BTTB to give PSTN connection to the petitioner till 3.8.93 was due to the wilful, deliberate and wrongful conduct of BTTB, which forms the very basis of the petitioner’s argument. In fact, the High Court Division has refrained from expressing any opinion as to the culpability of BTTB. We also find that in the judgment of this Division in Civil Appeal No. 73 of 1992 we refrained from expressing any opinion as to which party is to be blamed for the impasse caused by the disputes and litigations between the parties.
10. Mr. TH Khan submits that in the earlier Writ Petition No. 1286 of 1992 the petitioner-company was added respondent No. 3 and in its affidavit-in-opposition the petitioner-company squarely blamed BTL for the impasse and supported the impugned cancellation of the agreement. Now it cannot approbate and reprobate and blow hot and cold in the same breath and take advantage of its own wrong. Both BTL and the petitioner-company were locked in disputes and litigations and each side blamed the other. Now the petitioner cannot turn back and heap all the blame on BTTB.
11. It stares us in the face that the licence was granted 8 months after the signing of the agreement on 26.7.89 and BTL with its eyes open agreed in clause (3) of the licence that it will have exclusive right of operation for 5 years from the date of signing of the agreement, when it had already lost 8 months in the process. It must have been within the contemplation of BTL that some time will be needed to install the system and BTL willingly included that time within the time limit of 5 years. The right of the petitioner-company to the licence did not accrue until transfer. The petitioner also knew that it had no right to the licence until it was transferred to its favour. Unless it is clearly held and found that BTL was prevented from applying for transfer owing to the wrongful act of BUS, the petitioner-company cannot establish a case for implied term of contract for the purpose of computation of the date of commencement of the licence or its longevity for exclusive operation. No Court has ever found SUB to be the guilty party and therefore the delay in giving the PSTN connection cannot go in favour of the petitioner-company for deduction of the time lost in getting PSTN connection. The terms of the licence will remain in-tact. The High Court Division did not commit any illegality in discharging the Rule Nisi. BTL formally applied to BTTB for permission to transfer the licence and until it obtained the licence on transfer. The petitioner also knew that it had no right to the license until it was transferred to its favour. Unless it is clearly held and found that BTL was prevented from applying for transfer owing to the wrongful act of BTTB the petitioner company cannot establish a case for implied term of contract for the purpose of computation of the date of commencement of the license or its longevity for exclusive operation. No court has ever found BTTB to be the guilty party and therefore the delay in giving the PSTN connection cannot go in favour of the petitioner-Company for deduction of the time lost in getting PSTN connection. The terms of the licence will remain intact. The high Court Division did not commit any illegality in discharging the Rule Nisi.
12. We find no ground for interference. The petition is dismissed.