Licensees Operating Under Interim Court Orders Remain Contractually Liable for All Outstanding License Fees and Dues.

The Petitioner, Sunshine Caterers Pvt. Ltd., was awarded contracts to provide catering services in four trains for a five-year period

Upon the expiry of the original term on June 20, 2019, the Respondent (IRCTC/Railways) issued impugned letters on December 20, 2019, refusing renewal due to the Petitioner's failure to meet minimum guaranteed performance standards

The Petitioner challenged these letters, and on December 24, 2019, the High Court granted interim orders allowing the Petitioner to continue operations

Over the course of the litigation, IRCTC alleged significant outstanding license fee dues totaling approximately Rs. 5,30,00,000/-

By early 2026, the potential renewed periods for the contracts also expired

The Petitioner eventually withdrew services from all four trains by March 2026

1. Whether the Respondents are entitled to recover outstanding license fees for the period during which the Petitioner continued operations solely under the Court’s interim protections

2. Whether the Petitioner can be exempted from contractual financial obligations while operating under a court-mandated stay

the fundamental principle of contractual reciprocity and the equitable principle governing interim reliefs. It held that interim orders maintaining a status quo or allowing a party to perform under a contract "in terms of the contract" necessarily imply the fulfillment of reciprocal obligations, specifically the payment of license fees

the terms of the original License Agreements and the specific conditions of the interim order dated December 24, 2019, which mandated performance "in terms of the contract"

The Court reasoned that since the interim orders allowed the Petitioner to continue providing catering services "in terms of the subject contracts," such performance is inseparable from the obligation to pay the agreed license fees

The Court rejected any implicit contention that a party could enjoy the benefit of operating a state contract under judicial protection without discharging the corresponding financial liabilities to the State/IRCTC

Given that the Petitioner admitted to the liability (contending only that payments had been made) and that the renewed terms of the contracts had since expired by efflux of time, the Court found that the only remaining judicial necessity was to affirm the Respondent's right to recover dues for the overstayed period

The Court granted IRCTC the liberty to take necessary legal steps to recover these amounts in accordance with the law

All interim orders were effectively vacated as the contract periods had expired and the Petitioner had withdrawn from operations