Aurangabad Municipal ... vs M/S Shalaka Engineering And J V ...
2016 Latest Caselaw 1701 Bom

                                         1                 WP-4568.16A.doc


              IN THE HIGH COURT OF JUDICATURE AT BOMBAY,




                                                                         
                         BENCH AT AURANGABAD
                         WRIT PETITION NO . 4568 OF 2016




                                                 
     Aurangabad Municipal Corporation,
     Aurangabad
     Through its Municipal Commissioner                   ... PETITIONER




                                                
              VERSUS
     M/s Shalaka Engineering & J. V.,
     A Registered Partnership firm having
     its office at Edge Archade, Sant Eknath
     Mandir Road, Osmanpura, Aurangabad




                                       
     Through its Partner-Smt.Suwarna Sunil Raka
     Age: 45 years, Occu.Business
                             
     Having the address as above                  ...RESPONDENT
                                   .....
     Mr. Atul M. Karad, Advocate for petitioner
                            
     Mr. Anil S. Bajaj, Advocate h/f Mr. Aditya N. Sikchi, Advocate
     for respondent
                                   .....
      


                                   CORAM :   SUNIL P. DESHMUKH, J.

DATE : 21st APRIL, 2016

ORAL JUDGMENT :

1. Rule. Rule made returnable forthwith and heard finally

with consent of learned advocates for the parties.

2. The petitioner - Aurangabad Municipal Corporation

(herein after referred to as "AMC"), aggrieved by judgment

and order dated 30th March, 2016, of the District Judge-7 at

Aurangabad in Miscellaneous Civil Appeal No. 35 of 2016 is

before this court, whereunder, District Judge-7 has directed

2 WP-4568.16A.doc

petitioner - Aurangabad Municipal Corporation to maintain

status-quo ante, as had been existing on 25 th July, 2015 by

removing seal affixed to the suit property bearing C.T.S. No.

16261 situated at Jyotinagar, Aurangabad (herein after

referred to as "suit premises" for convenience) and to restore

the possession of the same until final hearing of the suit and

further purporting to restrain the petitioner - AMC temporarily

from disturbing ig possession of the respondent without

following due process of law. Respondent had also been

restrained from raising any kind of structure without

permission of competent authority. Operation of this order has

been stayed for appeal period, upon an application on behalf

of AMC (Exhibit-15) by the appellate court.

3. Learned counsel Mr. Atul M. Karad appearing for

petitioner and Mr. Anil S. Bajaj learned counsel holding for

learned advocate Mr. Aditya N. Sikchi, for respondent, were

heard extensively in the writ petition.

4. From submissions of the learned counsel and documents

as have been appended to the writ petition, factual position

emerges, around 2009, petitioner had entered into an

agreement with the respondent dated 10th October, 2009

3 WP-4568.16A.doc

(BOT agreement for lease) for lease of suit premises with an

intention to develop and manage swimming pool and

amenities complex. This agreement appears to have been

preceded by an agreement/document dating back to 2007. In

the agreement of 2009, petitioner has been referred to as

Aurangabad Municipal Council [AMC], whereas respondent has

been referred to as "occupant/concessionaire". Said

agreement, inter-alia, contains following two terms viz;

clauses 5.6 and 7.19, which are extracted from annexure to

writ petition and reproduced herein-below for ready

reference;

...........................

"5.6 In the occupant even of default after the concession

period, AMC shall serve upon the occupant a notice in writing mentioning therein the default and shall time, as may deem fit and proper considering the nature of default,

to the occupant for removal / rectification of the default. In case the occupant does not remove / rectify the default, AMC is empowered to terminate this lease agreement by

giving a one month notice in this regard." ...........................

"7.19. That the Occupant shall not carry on any illegal activity in the leased premises. In case he/she/it does so, the lease granted under this agreement shall liable to be terminated forthwith without notice."

4 WP-4568.16A.doc

5. Around July, 2015, upon visits, petitioner contendedly

found some irregularities, unauthorised user and/or illegal

activities being carried on/out over the suit premises. Some

panchnamas were drawn. The property had been sealed,

respondent purportedly had taken steps for corrective action

and/or to carry out rectifications in respect of alleged

irregularities, unauthorised user and/or illegal activities.

6.

It appears that respondent had been before Division

Bench of the High Court under Writ Petition bearing No. 6834

of 2015 and under order dated 10 th July, 2015 the High Court,

upon statement of the parties directed that panchnama be

drawn on 11th July, 2015, de-sealing the suit premises.

Pursuant to said order, AMC had liberty to take appropriate

action in accordance with the BOT lease agreement and in

consonance with the provisions of law.

7. It appears that notice dated 7th July, 2015 was issued by

petitioner, imputing that the alleged activities by the

respondent are in breach of terms and conditions of the

agreement and as such, written explanation had been sought

and the respondent was directed to be present before the

authorised officer on 9th July, 2015.

5 WP-4568.16A.doc

8. It is contended that pursuant to the notice, respondent

had submitted his reply. Thereafter, on 17 th July, 2015, a

communication/notice had been issued by the petitioner-AMC

to the respondent stating that the alleged activities are in

serious contravention and breaches of terms and conditions of

the agreement. Said notice/communication was purportedly

issued referring to clause 5.6 as reproduced hereinabove. It

appears that respondent had submitted two responses to the

notice/communication and the proceedings culminated into

order dated 24th July, 2015 by petitioner, invoking clause 7.19

terminating the agreement dated 16 th October, 2009 alleging

commission various irregularities/ unauthorised/illegal

activities, breaches and deficiencies by the respondent.

9. Immediately on 25th July, 2015, it appears that by

drawing panchnama, seal had been put on the property and

had been taken in possession by petitioner-AMC. It appears

that the respondent had been to Division Bench of this court

against aforesaid in Writ Petition No. 7796 of 2015 and under

order dated 29th July, 2015 the respondent had been granted

leave to withdraw the writ petition with liberty to file

appropriate proceedings.

6 WP-4568.16A.doc

10. It appears that respondent also is being prosecuted in

respect of alleged commission of certain offences and in

respect of the same the respondent had applied, seeking

anticipatory bail etc.

11. It also appears after withdrawal of writ petition No.

7796 of 2015, the respondent had been before the District

Judge-1 by way of filing Municipal Appeal No.02 of 2015

against the

order/communication dated 24th July, 2015

purporting to be appeal under Section 81 (F) of the

Maharashtra Provincial Municipal Corporation Act, 1949. Said

appeal was dismissed under order dated 27 th October, 2015

finding that the appeal is predominantly directed against the

order of taking over possession and did not challenge

termination of lease agreement and the action taken by

Aurangabad Municipal Corporation was not liable to be faulted

with.

12. After aforesaid order dated 27th October, 2015, the

respondent has instituted Regular Civil Suit No. 119 of 2015

in the court of Civil Judge, Senior Division - Corporation Court

at Aurangabad, wherein, petitioner herein is the sole

defendant and respondent herein is plaintiff. [The parties

7 WP-4568.16A.doc

hereto hereinafter are referred to by their status in Regular

Civil Suit No. 119 of 2015 viz; respondent as plaintiff and

petitioner as defendant].

13. The plaint prayers read as under;

" The suit of the Plaintiff be decreed with cost as under:-

a) By Decree of Declaration it be declared that the order dated 24.7.2015 passed by the Defendant terminating the

Agreement of Lease dated 16.10.2009 is illegal, null and void and be quashed.

b) By Decree of Mandatory Injunction the Defendant be directed to remove the seal affixed from the suit property

as described in the claim clause and description clause of the plaint on 25.7.2015, vide Panchanama of the even

date.

c) By decree of Perpetual Injunction the Defendant be

restrained from creating any sort of third party interest in the suit property of any nature and also from causing obstruction and interference in the peaceful possession of

the Plaintiff of the suit property as described in the claim clause and description clause of the plaint.

d) any other relief be granted which the court deems fit in favour of the Plaintiff and oblige. "

8 WP-4568.16A.doc

14. Along with plaint, the plaintiff had also filed an

application under Order XXXIX, Rules 1 and 2 read with

Section 151 of the Code of Civil Procedure, for temporary

injunction praying for following reliefs:-

" The temporary injunction application be allowed

with costs as prayed for till disposal of the suit by following orders and in following terms:-

a) By an order of Ex-party Temporary Injunction and Ad-

interim Injunction the Defendant be directed to remove the seal affixed on the suit property as described in the claim clause and description clause of the plaint and Injunction

Application on 25.7.2015, vide Panchanama of the even date.

b) By an order of ex-parte Temporary Injunction and Ad- interim Injunction the Defendant be restrained from

creating any sort of third party interest in the suit property of any nature and also from causing obstruction and interference in the peaceful possession of the Plaintiff of

the suit property as described in the claim clause and description clause of the plaint and Injunction Application.

c) Any other relief be granted which the court deems fit in favour of the Plaintiff and oblige. "

9 WP-4568.16A.doc

15. The trial court, in proceedings pursuant to aforesaid

application, had framed points for determination; whether the

plaintiff has prima-facie case, whether balance of convenience

lies in favour of plaintiff and whether plaintiff will suffer

irreparable loss. Answering all the points framed partly in the

affirmative, the Civil Judge, Senior Division, Corporation

Court, Aurangabad has rejected the request for temporary

mandatory injunction finding that the action has been taken

by the defendant cancelling the agreement, invoking clause

7.19. Circumstances do not warrant grant of temporary

injunction directing removal of affixed seal to the suit

premises. However, having regard to the facts and

circumstances, the defendant would not be able to create any

third party interest over the suit premises, and as such, has

granted relief to the plaintiff-respondent under order dated

11th February 2016 in Regular Civil Suit No. 119 of 2015 as

under;

......................

" 02. Defendant corporation or anybody claiming through it are hereby temporarily restrained from creating any sort of third party interest of any nature over the suit property, till disposal of the suit."

......................

Rest of the prayers were rejected.

10 WP-4568.16A.doc

16. As such, plaintiff had been before District Judge-7 in

aforesaid Miscellaneous Civil Appeal No. 35 of 2016

challenging the order dated 11th February, 2016 passed by

Civil Judge, Senior Division, Corporation Court, Aurangabad

for reliefs to the extent which were refused to be granted by

the trial court.

17. The appellate court had framed a point for

determination as to whether the order of the learned lower

court calls for interference.

18. The appellate court under its judgment and order dated

30th March, 2016 directed the corporation - petitioner to

maintain status-quo ante as it was existing on 25th July, 2015

by removing the seal affixed on the suit property, passing

following order.

" 1. The appeal is allowed and the impugned order under challenge is hereby set-aside with following directions:

The respondent Corporation is directed to maintain status quo ante as it was existing on 25.7.2015 by removing the seal affixed on the suit property bearing No. C.T.S.No.16261 at Jyoti nagar, Aurangabad i.e. premises 'Raka Life Style' and to restore the possession until the final hearing of the suit.

                                                 11                   WP-4568.16A.doc




                                                                                   
                      2.       The   respondent      Corporation      is    temporarily

restrained from disturbing the possession of the Appellant

without following due process of law.

3. The appellant is also temporarily restrained from

raising any kind of structure without permission of Competent Authorities.

4. Parties to bear their respective costs.

Dictated and pronounced in open Court."

As such, the present petition against aforesaid order by

petitioner - original defendant.

19. Learned counsel Mr. Karad appearing for the petitioner

contends that while the suit premises were visited and

explanation considered, it surfaced that the situation has

been grave and the damage/illegalities will have to be

arrested, and as such, the order dated 24th July, 2015 had

been issued. He submits that it cannot be said that the action

is ultra-vires the terms and conditions of the agreement. The

AMC was well within its power under the terms and conditions

of agreement. The appellate court has not at all given due

regard to the object, purport and underlying intention of the

terms and conditions of agreement.

12 WP-4568.16A.doc

20. It is contended by learned counsel for petitioner that

clause 7.19 of the agreement, enables the corporation to

terminate the lease agreement forthwith for illegal activities

on the leased premises and it was noticed that the respondent

had been carrying on illegal activities over the leased suit

premises. The agreement has been terminated as per terms

of agreement.

21.

Mr. Bajaj, learned counsel for respondent contends that

the sequence of events as occurring is clear indication of that

the order dated 24th July, 2015 is capricious. The plaintiff had

initially issued a communication on 7th July, 2015 calling

explanation which was duly given. Thereafter, AMC purported

to move on with reference to clause 5.6 requiring giving of

time to remove deficiencies/irregularities etc. and suddenly

veered around and passed order dated 24th July, 2015

purporting to invoke clause 7.19 without giving any inkling

whatsoever about such an action being mooted. Petitioner is

estopped from approbating and reprobating. Such an action is

abhorable in the facts and circumstances and in law.

22. Learned counsel for the respondent contended that the

action of the corporation is high handed, without letting any

13 WP-4568.16A.doc

opportunity to the occupant and in breach of principles of

natural justice, alleging breaches against the occupant

without giving any notice as to consequential drastic action.

In fact, there are no breaches and as such, the occupant is

entitled to repossession of the property, possession of which

has been taken high handedly, by taking law in hand.

23. Learned counsel further submits that having regard to

the facts and circumstances. The order dated 24 th July, 2015

is not only capricious, but is also whimsical and fanciful. The

appreciation of facts and circumstances and treatment to the

same cannot be as per the wishes of officials. The facts and

circumstances require to be objectively looked at and not

subjectively as is done by defendant in the present case. He,

therefore, submits that the appellate court has seen the

matter in its correct perspective, gauged its tenability and

consequences, and has rightly passed the order, which does

not deserve any disturbance/interruption.

24. It emerges that the action of petitioner - corporation

dated 25th July, 2015 has been considered by the appellate

court to be without following principles of natural justice.

14 WP-4568.16A.doc

25. With reference to certain citations which have

been relied upon on behalf of the parties, the order has been

passed, considering that process of fair action with due

information does not appear to have been adhered to and as

such, order has been passed directing the corporation -

petitioner to maintain status-quo ante as it was existing on

25th July, 2015 by removing the seal affixed on the suit

property, by passing following order.

1. The appeal is allowed and the impugned order under challenge is hereby set-aside with following

directions:

The respondent Corporation is directed to maintain status quo ante as it was existing on 25.7.2015 by

removing the seal affixed on the suit property bearing No.

C.T.S.No.16261 at Jyoti nagar, Aurangabad i.e. premises 'Raka Life Style' and to restore the possession until the final hearing of the suit.

2. The respondent Corporation is temporarily restrained from disturbing the possession of the Appellant without following due process of law.

3. The appellant is also temporarily restrained from raising any kind of structure without permission of Competent Authorities.

4. Parties to bear their respective costs.

Dictated and pronounced in open Court."

15 WP-4568.16A.doc

26. Perusal of the impugned judgment and order shows that

although the appellate court had been apprised of the

notices/communications dated 7th July, 2015 and 17th July,

2015, while it came to giving reasons, it had been in oblivion

in respect of notice/communication dated 17 th July, 2015.

     Both       the        notices/communications         alleged     irregularities/

     unauthorised            user/illegal   activities.   The     appellate        court




                                            
     appears          to     have
                              ig     been     overwhelmed           by     that       the

communication dated 7th July, 2015 does not ask plaintiff to

show cause against consequences from failure to tender

satisfactory/acceptable/proper explanation. It is discernible,

the appellate court appears to have overlooked that one of

the communications refers to clause 5.6 which sufficiently

indicates the likely fall out of the communications/notices.

The matter would not be looked at pedantically at this stage,

wherein allegations have been made and further that the

allegations of acts of violation and breaches of the terms of

the contract veracity or otherwise of which would emerge on

evidence. The matter appears to have been looked at only

from a perspective of seeming breach of principles of natural

justice. It is a debatable aspect, having regard to the events

as those have occurred hitherto and would have to be

16 WP-4568.16A.doc

resolved upon evidence by parties. Lot of fact finding in the

course appears to be involved. Forming judgment, at this

stage appears to be premature even in respect of principles of

natural justice.

27. Prima-facie, clause 7.19 appears to authorise the AMC

to act without notice. Whether clause No. 7.19 could have

been invoked in the facts and circumstances of the case is a

question to be determined upon evidence.

28. Granting such relief at preliminary stages in a matter

which would require decision on issues arising after leading

evidence, may not be warranted in given facts and

circumstances.

29. Looking at the prayer clauses, which have been

reproduced hereinabove as well as temporary injunction

application and the impugned order passed by the appellate

court, it appears that impugned order would tantamount to

deciding the lis between the parties, at preliminary stage.

Such order can be passed only in very exceptional and rare

cases where the situation demands such an order. One may

not be able to say that the present matter gives rise to such a

situation wherein such an order is required to be passed at

17 WP-4568.16A.doc

the interim stage.

30. Having regard to aforesaid, the order, directing to

maintain status-quo ante as was existing on 27th July, 2015 is

set aside. So also clause No.2 from the impugned order that

the Corporation is temporarily restrained from disturbing the

possession of the appellant without following due process of

law, is set aside. Rule is made absolute in terms of prayer

clause (C).

31. It is, however, made clear that the petitioner -

Corporation - defendant would abide by the order passed by

the Civil Judge, Senior Division, Corporation Court,

Aurangabad about non creation of any third party interest

over the suit property and further that the parties would

maintain status-quo in respect of the suit property during the

pendency of the suit.

32. In the circumstances, it would be appropriate that the

suit itself which is pending between the parties be decided

expeditiously. As such, the trial court to proceed with and

decide the same as expeditiously as possible preferably within

a period of three months from the date of receipt of writ of

this order.

18 WP-4568.16A.doc

33. It is made clear that observations appearing in this

judgment and order are only prima-facie in nature and shall

not at all influence and/or impress on the decision making in

the suit or any other proceeding. The observations have

efficacy limited only for decision in writ petition and no

further.

34. Learned counsel agree to co-operate with the trial court

for expeditious disposal of the suit.

35. As such, writ petition stands disposed of.

( SUNIL P. DESHMUKH, J. )

sms