Bombay High Court
M/S Chandadevi & Sons P. Ltd A ... vs The State Of Mah & 5 Others on 2 May, 2016
Bench: B.P. Dharmadhikari
Judgment. wp4560.03
1
IN THE HIGH COURT OF JUDICATURE AT BOMBAY,
NAGPUR BENCH, NAGPUR.
WRIT PETITION NO. 4560 OF 2003.
1. M/s. Chandadevi & Sons P. Ltd.,
a Company registered under the
Companies Act, 1956 and having its
registered office at "Saroj", ramdaspeth
Nagpur, through its Director Mr. Sanjay
Laxman Kondawar.
2. M/s. Radhakrishna Exhibitors,
a Partnership Firm duly registered under
the provisions of the Indian Partnership
act, 1932 through its Partner Mr. Naval
s/o Shalikramji Rathi, aged about 52 years,
Occupation - business, resident of
Vihar Apartment, Ramdaspeth,
Nagpur.
3. M/s. Saroj Trading Company,
a partnership firm duly registered
under the provisions of Indian Partnership
Act, 1932, having its place of business
at 7, Kanchan Sarita, Near Lokmar Square
Wardha Road, Nagpur 440- 012
through its Partner Mr. Naval s/o
Shalikramji Rathi, aged about 52
Years, Occ - business, r/o. Vihar
apartment, Ramdaspeth, Nagpur. ..... PETITIONERS.
VERSUS
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Judgment. wp4560.03
2
1. The State of Maharashtra, through
(i) The Secretary, Home Department
Mantralaya, Mumbai - 400 032.
(ii) The Secretary, Revenue and Forest
Department, Mantralaya, Mumbai - 32.
2. The Commissioner, Nagpur Division,
Nagpur.
3. The Collector, Bhandara District,
Bhandara.
4. The Sub Divisional Officer,
Bhandara.
5. The Tahsildar, Tumsar.
6. Mr. Rajendra s/o Navalkishore Mishra,
aged about 62 years, Occupation
Agriculturist, r/o. Tumsar, Tahsil
Tumsar, District Bhandara.
(deleted as per Courts order
dated 04.10.2006) ..... RESPONDENTS.
--------------------------
Mr. M.V. Samarth, Advocate for Petitioners.
Shri Ekre, learned A.G.P. for Respondents.
--------------------------
CORAM : B.P. DHARMADHIKARI
& P. N. DESHMUKH
,
J J.
DATE : MAY 02, 2016.
Judgment. wp4560.03
ORAL JUDGMENT : (Per : B.P. Dharmadhikari, J.)
Petitioners before this Court are seeking a
declaration that refusal to renew Cinema licence in favour of
petitioner nos. 2 and 3 by respondent no.2 on the ground that
the transfer/assignment of leasehold land by the petitioner no.1
to them is, illegal, should be quashed and set aside. The
assignment or transfer is, found illegal as unearned income as
stipulated in the government circulars dated 12.10.1995 and
18.10.1996 has not been paid. Petitioners therefore, pray for
quashing these circulars also.
2. Shri Samarth, learned Counsel appearing on behalf
of the petitioners invites attention to the impugned order dated
30.08.2003 to show that only because plot of land on which the
cinema talkies is standing is held to be transferred illegally by
petitioner no.1 to other petitioners, the renewal or grant of
cinema licence has been declined. He points out that there was
earlier litigation which finds mention in the impugned order,
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and matter was remanded back for fresh consideration.
3. The assignment or transfer is on 30.09.2000, and
the lease deed was already renewed for a period of 30 years on
26.05.2000. The period of renewal was from 01.04.1978 to
31.03.2008. The area of land covered by the renewal order is
897.76 sq. mtrs. Shri Samarth, learned Counsel points out that
in this renewal documents, there is no condition of paying any
unearned income, and hence, on such ground transfer or
assignment could not have been declared as illegal. He has
relied upon the provisions contained in Clauses 6 and 8 thereof
to demonstrate that the assignment is expressly permitted, but,
only intimation there of is required to be given.
4. He has pointed out that after this assignment, a
prayer for mutation was made on behalf of purchasers on
11.10.2000, and at that time the respondents demanded a
bond vide communication dated 16.07.2002. Petitioners sent
reply to it on 19.08.2002 and pointed out that there was no
need of giving such bond.
Judgment. wp4560.03
5. He has invited our attention to a Division Bench
judgment of this Court reported at 2009 (2) BCR 407
(Jaikumari Amarbahadursingh and others .vrs. State of
Maharashtra and another), to urge that there, when a
condition requiring the lessee to pay 60% or 75% of the
amount of sale consideration, as unearned income was sought
to be added on the eve of renewal of lease, the Division Bench
has found the exercise without jurisdiction. He contends that
in present matter, no such condition was added when renewal
was granted and there is no effort by the respondents to insert
such a condition in the lease deed. By placing reliance upon
circulars dated 12.10.1995 and 18.10.1996, by which the
unearned income is being demanded, he points out that when
in contractual matters such an exercise is not permitted, the
respondents cannot unilaterally, and that too by issuing such
circulars impose a condition and force the petitioners to pay
unearned income.
6. Shri Ekre, learned A.G.P. appearing for the
Judgment. wp4560.03
respondent State is opposing the petition. According to him,
as per Clause 8 of the renewed lease deed, the State
Government can always add appropriate conditions. In
exercise of that powers, the Government Resolutions have been
issued on 12.10.1995 and 18.10.1996. These government
resolutions are binding upon the petitioners and hence, they
are duty bound to pay the unearned income. As unearned
income has not been paid, the assignment in favour of
petitioner nos. 2 and 3 itself is non-est, and therefore, the
application for grant of or renewal of cinema licence is
unsustainable. He is relying upon the return filed by
respondent no.5 to substantiate the case of respondents.
7. After hearing the respective Counsel we find that in
renewed lease deed dated 26.05.2000 vide clause no.6, the
lessee i.e. the petitioner no.1 was permitted to assign the
premises or part thereof. Only condition was delivery of a
notice of one month duration, mentioning name and
description of parties to whom the premises or part there was
being assigned. Clause no.8 on which the learned A.G.P. has
Judgment. wp4560.03
placed reliance operates at the end of the term of the lease and
speaks of renewal for a term of 30 years. It permits
enhancement of rent. Nothing in that clause can be read as
enabling the respondents to ask leave to pay unearned income.
Moreover, in present facts, the assignment is on 30.09.2000 i.e.
not at the end of the term of renewed lease deed.
8. Thus, in terms of clause no.6, petitioner no.1 has
transferred the property to petitioner nos. 2 and 3. The
document dated 12.09.1995, pointed out by the petitioners is
titled as "जापन" i.e. Circular or Note. It speaks of a decision
taken by the government on the issue of renewal of lease deeds
of 1063 lands at Gondia and Bhandara. The Desk Officer has
informed the Divisional Commissioner at Nagpur that earlier
approval given on 19.11.1994, has been cancelled and total
1063 lease deeds can be renewed after charging 3 times of the
lease rent. It is also mentioned that for violating terms and
conditions of lease, a fine of Rs. 500/- should be recovered with
prescribed interest. If lease is transferred for residential
purposes 50%, and if it is transferred for commercial purpose
Judgment. wp4560.03
75%, of the amount of difference in sale price and lease
premium should be recovered, as unearned income. Thus, this
is a decision taken in relation to specified and particular type of
cases. The later circular or note dated 18.10.1996 only
clarifies how unearned income is to be calculated. Respondents
do not urge that lease of petitioner is one of 1063 cases
mentioned supra.
9. This circular or note dated 12.09.1995, is attracted
when there is transfer in violation of terms and conditions of
lease. The respondents have not pointed out any such violation
by petitioner no.1, on the contrary as noted by us supra, vide
clause no.6 of the renewal deed, such an assignment is
expressly permitted. Therefore, this circular or note dated
12.09.1995, or then dated 18.10.1996, are not attracted in
present case. Even if it is read as government resolution, the
above discussion is sufficient to show that it does not make any
material difference.
10. The Division Bench judgment of this Court in case of
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Jaikumari Amarbahadursingh .vrs. State of Maharashtra
(supra), has considered the situation in which the State
Government unilaterally wanted to introduce a condition of
paying unearned income at the time of renewal of lease deed.
Renewals were thus not being done, if the lessee did not agree
to incorporation of such a condition in the renewal deed. The
Division Bench found scope of such powers to insist at the time
of renewal is limited and ultimately has set aside the
government resolution dated 19.06.2007. Said government
resolution was on amended policy for renewal of leases in
Nagpur and Amravati division. Thus, it was not in relation
either to Bhandara or Gondia Districts. However, it is apparent
that when at renewal stage such an insistence cannot be
accepted, at the time of transfer/assignment, its application or
acceptance is automatically ruled out. Otherwise the State
Government would be in a position to modify terms and
conditions of all lease agreements by an executive feat. Hence,
even on this count, we find that the circulars dated 12.10.1995
and 18.10.1996, are not attracted in present matter.
Judgment. wp4560.03
11. Perusal of the impugned order reveals that the
Collector and District Magistrate was on 30.08.2003
considering an application for grant of cinema licence. It is not
in dispute that a cinema was already functioning on this
property. The licence needed to be mutated or altered in the
name of petitioner nos. 2 and 3 to whom the property was
assigned. Merely because the transfer or assignment is itself
found faulty or illegal, the renewal or mutation of cinema
licence has been declined. Perusal of the said order dated
30.08.2003, reveals that the Collector has relied upon a report
of the Sub Divisional Officer dated 21.03.2002. That report
reveals that as the transfer is illegal, there was violation of
lease conditions and, hence, as per the provisions of Section
41[3] of the Maharashtra Land Revenue Code 1971, the land
needed to be confiscated back to the government. Section
41[3] of the Maharashtra Land Revenue Code, 1966 speaks of
power of Collector to grant permission for erection of one or
more farm buildings. It does not speak of any confiscation of
land.
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12. The Maharashtra Land Revenue (Disposal of
Government Lands) Rules, 1971 contain Rule 41. This rule is
about condition of grant of land for non-agricultural purposes.
Rule 41[2] envisages cases in which land is granted for
building site. As per Sub clause (iii) thereof, the grantee has to
erect a building of substantial and permanent description
within three years or within such further time as the Collector
may allow. However, in default, land is liable to be resumed
on payment of compensation not exceeding the occupancy
price paid by the grantee. It is therefore, obvious that the said
provision also has no application in the present facts.
13. We need not delve more into this controversy, as in
renewed lease deed there is no power with the respondents to
demand any unearned income. In circulars dated 12.10.1995
or 18.10.1996, also there is no such power as those circulars
are not attracted in the case of the present petitioners.
14. We therefore find the impugned order dated
30.08.2003 unsustainable. It is accordingly quashed and set
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aside. The assignment by petitioner no.1 in favour of petitioner
nos. 2 and 3 on 30.09.2000 cannot be treated as illegal. The
respondents have to proceed to consider the prayer of
petitioners for grant of cinema licence or for its renewal in
accordance with law. It is not necessary to set aside the
circular or note dated 12.10.1995 or 18.10.1996 in present
matter.
15. We direct the respondent no.2 to proceed
accordingly with the application moved by the petitioner no.2
for grant /renewal of cinema licence, at the earliest, and to
decide it, preferably within a period of three months from
today.
16. In view of above, Writ Petition is partly allowed.
Rule is made absolute in the aforesaid terms, with no order as
to costs.
JUDGE JUDGE
Judgment. wp4560.03
Rgd.
