A Licensee Has No Right to Occupy After Termination – Writ Not Maintainable to Enforce Contractual Privilege: Andhra Pradesh High Court

"A licensee cannot assert tenancy-like rights or seek judicial protection from eviction once the license is lawfully terminated", declared the Andhra Pradesh High Court in a judgment dated 18 November 2025, dismissing a writ petition filed by a shop operator at Rushikonda Beach, Visakhapatnam, challenging the termination of his license agreement by the Andhra Pradesh Tourism Development Corporation (APTDC).

The ruling, authored by Justice Gannamaneni Ramakrishna Prasad, emphatically clarified that disputes arising out of contractual licenses do not fall within the ambit of writ jurisdiction, even when the respondent is a State instrumentality under Article 12 of the Constitution. The Court observed that the petitioner’s recourse lies in a civil suit for compensation, not in invoking constitutional remedies under Article 226.

“Writ Jurisdiction Cannot Be Invoked to Enforce Purely Contractual Rights”: License Termination Upheld, Petitioner Directed to Seek Civil Remedies

Proprietor of Gayatri Children Based Eco Tourism Projects, which was allotted Shop No. 9A under a license agreement dated 03.10.2020, sought to challenge the termination of his license by APTDC through a writ of mandamus. The petitioner argued that the termination notice, issued on 17.09.2025, was arbitrary, violative of natural justice, and infringed Articles 19(1)(g) and 21 of the Constitution.

Rejecting the plea, the High Court ruled that the agreement was purely contractual, the petitioner was in admitted breach, and that judicial review was not warranted in a dispute that raises no public law element.

The petitioner had secured a food shop at Rushikonda Beach as part of a tourism development initiative under a five-year license agreement. The license permitted termination under Clause 7 for non-compliance, default, or deviation from permitted business use.

In April 2025, APTDC issued a preliminary notice, citing rental arrears and operational inactivity. The petitioner responded, admitting defaults and requesting indulgence. On 17 September 2025, APTDC issued the termination letter, citing continued closure of the shop, non-submission of performance security, and lack of response to follow-ups.

The petitioner filed the writ, seeking to set aside the termination and restrain APTDC from taking possession. An interim order dated 06.10.2025 was secured from another bench directing partial payment and temporary restraint on eviction.

Whether a writ lies to challenge termination of a license governed by private contract?

The Court answered in the negative, stating:

“Though Respondent No.2 (APTDC) is ‘State’ under Article 12, the nature of the grievance is purely contractual. The petitioner has not demonstrated any violation of constitutional or public duty. No writ lies to enforce such rights.”

Referring to Chandu Lal v. MCD and Sant Lal Jain v. Avtar Singh, the Court emphasized that licensees have no statutory or vested rights in property, and termination is a prerogative of the licensor.

Whether the license agreement conferred any possessory or tenancy-like rights?

The Court clarified:

“The agreement was not a lease but a license. References to lease or rent in correspondence are irrelevant. The license conferred a personal privilege—not interest in the property. Legal possession always remained with APTDC.”

Relying on Corpn. of Calicut v. K. Sreenivasan and HMDA v. Hotel Malligi Pvt. Ltd., the Court reiterated that a licensee’s status post-termination is that of a trespasser and the only relief available is compensation, not continuation or reinstatement.

Whether the writ petition was maintainable despite admitted contractual breach?

The Court noted the petitioner’s admitted rental default, inactivity for four months, and failure to submit bank guarantee. It held:

“Even if the license was terminated without cause, the licensee's remedy is to seek damages—not to seek reinstatement or injunction via writ.”

It relied on the recent Supreme Court decisions in Samarpan Varishtha Jan Parisar v. Rajendra Prasad Agarwal and Ghanshyam v. Yogendra Rathi, which reaffirmed that licensees cannot seek equitable or injunctive relief post termination.

The Court observed:

“The present writ petition is not maintainable despite APTDC being a State under Article 12, as no public law element is involved. The petitioner is not entitled to seek continuation of license or injunctive relief through writ jurisdiction.”

And further noted:

“Once the license stands terminated, continued possession becomes unlawful. Licensee may seek compensation but not possession or protection from eviction.”

The Court dismissed the writ petition, holding that the termination of license was legally sustainable. The interim order dated 06.10.2025 was vacated, and the petitioner was granted liberty to file a civil suit for damages, if advised.

"There is no legal or tenable basis for a licensee to assert a right to continue in occupation of the licensed premises after expiry or termination of the license," the Court held, underlining the doctrine that license does not confer interest or possession, and termination revokes all privileges.

Date of Decision: 18 November 2025