Tolaram (India) Limited &Anr vs The Union Of India & Ors
2021 Latest Caselaw 5662 Cal

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               IN THE HIGH COURT AT CALCUTTA

                     Civil Appellate Jurisdiction

                           APPELLATE SIDE

  PRESENT :-

  THE HON'BLE JUSTICE SUBRATA TALUKDAR
                AND
  THE HON'BLE JUSTICE KESANG DOMA BHUTIA


                          MAT No. 778 of 2021
                                   With
                         I.A. No. C.A.N. 1 of 2021
                                   with
                         I.A. No. C.A.N. 2 of 2021
                     Tolaram (India) Limited &Anr.
                                   VS.
                      The Union of India & Ors.


For the Appellants            : Mr. BikashRanjan Bhattacharya,
                                Ld. Sr. Adv.,
                                Mr. DebashisKundu, Ld. Sr. Adv.
                               Mr. R.N. Barik, Adv.
                               Mr. A. Kundu, Adv.
For the Union Of India        : Mr. Y.J. Dastoor, Ld. A.S.G.I.

                               Mr. Rudraman Bhattacharyya, Adv.

                               Ms. Upama Bhattacharjee, Adv.

Hearing concluded on          : 10.09.2021

Judgment on                   : 15.11.2021
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Kesang Doma Bhutia, J:-


      This Appeal arises impugning the order of dismissal passed by

the Hon'ble Single Bench in the Writ Petition No. 8341 of 2021 on

04.08.2021.


      The background facts leading to the filing of the present Appeal,

in brief, are as follows:


      That the subject property measuring19 Bighas, 13 Cotthas and

14 Chitkas land is situated at B-15 Garden Reach Road, Kolkata 24

and was originally owned by Victory Jute Products Ltd., prior to

Independence of India.


      The Appellant no.1 obtained lease of such property from the

original owner, a Pakistani National, for a period of 31 years at a

monthly rent of Rs.6000/-, on the strength of a Lease Deed dated 24 th

November, 1958.


      The subject property being owned by a Pakistani National was

vested in the Custodian of Enemy Property for India under powers

derived from the Defence of India Rules, 1962 and the orders made

thereunder and later under the Enemy Property Act, 1968. However,

the Appellant No.1 was permitted to retain the possession on payment

of monthly rent in the office of the Respondent no.3.

For the first time, Custodian of Enemy Property for India,

through Respondent No. 2 executed a formal lease agreement with

Appellant No.1 for a period of 36 months fixing monthly rent at

Rs.20,000/- on 1st January 2009 and subject to automatic extension

for another 36 months on payment of advance enhanced rent @ 5%

over the existing lease rent in the last month just before expiry of lease

period. In this manner lease granted to the Appellant stood extended

till December, 2020.

The Appellant, as per earlier practice and in view of Clauses 3

and 4 of the Lease Deed dated 01.01.2009, paid rent in advance for

the month of January 2021, with usual increment on lease rent along

with rent for the month of December, 2020, through cheques, which

were duly credited to the account of the Respondents in the month of

December 2020 itself.

However, the Appellants were taken by surprise when they

received letter and notice dated 07.01.2021 from the respondent no.3,

wherein they were informed that lease of the subject property was not

extended by the concerned authority beyond 31.12.2020 as the

property is placed for disposal u/s 8A of the Enemy Property Act. That

they have wrongly acknowledged the rent for the month of January

2021 and returned payment made towards advance lease rent for the

month of January 2021vide letter dated 19.02.21.

Being aggrieved by letter and notice dated 07.01.2021 issued by

respondent No. 3, the lessees/ appellants have moved the Hon'ble

High Court under Writ Jurisdiction and have prayed for issuance of

writ in the nature of Mandamus commanding the respondents and

each one of them to forthwith cancel, set aside the impugned letter

and notice dated 07.01.2021 and to treat the existing lease of the

appellant No. 1 in respect of the subject property extended for a

further period of thirty six months with effect from 01.01.2021 by

accepting rents for the month of February, 2021 onwards. Also, Writ

prohibiting the respondents from giving effect to the letter and notice

dated 7th January, 2021 and a Writ in the nature of Certiorari.

The Hon'ble Single Bench after hearing both sides has been

pleased to dismiss the WPA, with the findings that the property in

question though an enemy property, is a public premise. The steps

that have been taken by the respondent authorities for eviction of the

appellant from the Public Premises is at a budding stage where the

Estate Officer has not initiated any proceeding against the appellant

for their eviction.

The Hon'ble Single Bench has further been pleased to hold that when

the appellants can seek alternative and efficacious remedy under the

Public Premises (Eviction of Unauthorized Occupants) Act, 1971, the

Writ Petition under Article 226 is not maintainable as

petitioners/appellant have failed to show that there is a failure of

natural justice or the proceedings are wholly without jurisdiction or,

ultra vires a statue or, that the petitioners have not sought for

enforcement of any of their fundamental rights.

Being aggrieved by the order of dismissal, the Appellants have

preferred this appeal where they have alleged that the impugned order

suffers from illegality as the Hon'ble Single Bench limited itself by

declaring the subject property to be Public Premises under the Act of

1971 overlooking Clause 4 of the Lease Deed dated 01.01.2009, which

deals with the manner in which the lease period automatically stands

extended and thereby failed to appreciate the entire gamut of the writ

petition. The issues raised in the writ petition is beyond the scope and

ambit of the Estate Officer and was squarely within the domain of

Article 226 of the Constitution of India. Thus the Appellants have

prayed for setting aside the order under challenge.

Counsel for the parties have been heard at length.

Petitioners by filing writ petition have challenged the letter and

notice of the respondents dated 7th January 2021 and their decision

not to extend the lease of the subject property to be illegal, mala-fide,

arbitrary and beyond the terms and conditions of the Lease Deed

dated 1st January 2009.

It is settled law that the existence of an alternative remedy is not

an absolute bar to the maintainability of a writ petition under Article

226 of the Constitution. Writ Petition can be entertained in exceptional

circumstances where there is:

(a) A breach of fundamental rights;

(b) A violation of principles of natural justice;

(c) An excess of jurisdiction; or

(d) A challenge to the vires of the statute or delegated legislation.

Therefore, this court is required to examine whether the

impugned letter and notice dated 07.01.2021 is in violation of the

Clause (4) of the Lease Deed and the same is illegal, arbitrary and

mala-fide or beyond jurisdiction.

In order to decide such issue, it is necessary to reproduce Clause

(4) of the lease agreement of the subject property executed in between

the Appellants/Writ Petitioners and the Respondents on 01.01.2009.

Further, to understand the real implication of Clause (4), it needs to

be read in conjunction with Clause (3) of the agreement.

Clause (3) of the agreement reads as follows:

The rent hereby reserved i.e. Rs.20,000/- (twenty

thousand) shall automatically be increased by 5% every

three years as contemplated in the West Bengal

Premises Tenancy Act,1997.

Clause (4) of the agreement reads as follow;

The lease hereby granted albeit shall initially continue for a period

of 36 months from the commencement hereof. In the event the lessee do

deposit, in the last month before expiry of this lease the enhanced rent,

in advance hereby agreed simultaneously with the rent for the last

month of the lease, the lease hereby granted shall stand renewed for a

further period of 36 months commencing from the date of expiry of this

lease on same terms and in the similar manner in the event of deposit of

enhanced rent in advance in the last month of extended lease, the lease

shall be extended hereafter shall stand automatically renewed for a

further period of 3 years and so on in recurrence.

From these two clauses of the lease agreement, it becomes clear

the lease is subject to automatic extension on the lessee fulfilling the

conditions as mentioned in those two clauses of the agreement.

The documents which the appellants have filed show that they

have duly complied with the conditions as mentioned in Clauses (3)

and (4) of the agreement, just a month before the expiry of lease on

31.12.2020. More so, such facts stand also corroborated by the

contents of the impugned letter of the Respondents dated 07.01.2021.

Further, if the Respondents desired not to extend the lease of the

subject property, then they could have informed or served the

Appellants with a notice expressing their intention, before the

Appellants could exercise the conditions imposed by Clauses (3) and

(4) of the agreement. Once the Petitioners/Appellants were allowed to

exercise the options for extension of lease as per agreement and duly

complied with those conditions provided in those two clauses of the

agreement, then the respondents acting on their whims cannot go

beyond the terms and conditions of the agreement by issuing the

impugned letter and notice alleging the subject property is under

disposal and as such the lease stands determined.

Therefore, this Court find the impugned letter and notice dated

07.01.2021 to be inconsistent with the written terms and conditions

for extension of the lease agreement executed between the parties.

From the copy of the Bank Statement filed by the Appellants, it

appears that advance rent for the month of January 2021, with usual

enhancement of 5% of existing rent paid by the Appellants, was duly

credited to the account of the Respondents in the month of December

2020 itself.

Therefore, the respondents are precluded from asserting that

they have wrongly acknowledged the advance rent paid for the month

of January2021. The very facts permitting the Appellants to exercise

the options contained in Clause (4) of the agreement and accepting

advance rent for the month of January 2021 in the month of

December, gives rise to the deemed fiction of extension of the lease for

another 36 months on the accepted terms and conditions.

That apart, from several correspondence that were exchanged

between the parties after institution of the writ petition, it appears

that the respondents have initiated eviction proceeding against the

Appellants on the ground of being unauthorized occupants.

Rule 14 of the Enemy Property Rules 2015, deals with

unauthorized occupants and reads as follows:

If any occupant of the enemy property repeatedly

defaults in payment of rent or refuses to pay rent, the

District Authority, in consultation with the Custodian,

may take steps to terminate the lease or evict the

occupant forthwith in accordance with the Public

Premises (Eviction of Unauthorized Occupants) Act, 1971:

Provided that before evicting a person or terminating the lease

under this rule, a notice shall be issued to the occupant:

Provided further that it may be open to the custodian to initiate

criminal proceedings against such occupation under the relevant laws

for the time being in force.

Rule 14 B provides- The mention of particular matters in these

rules shall not be held to prejudice or affect the general application of

the Public Premises(Eviction of Unauthorized Occupants)Act,1971 with

regard to the effect of the disposal of immovable enemy property, being

the public premises and custodian being the estate officer under that

Act.

The expression "unauthorized occupation" in relation to any

public premises means the occupation by a person of the public

premises without authority for such occupation and includes the

continuance in occupation by any person of the public premises after

the authority (whether by way of grant, or any other mode of transfer)

under which he was allowed to occupy the premises has expired or

has been determined for any reason whatsoever.

As per Rule 14 of Enemy Property Rules, 2015 a person or an

entity becomes an unauthorised occupant, if the occupant is a

habitual defaulter in payment of rent. Clause (17) of the Lease Deed

too postulates that lease will be determined, if lessee fails to pay rent

for consecutive three months in one calendar year.

But, it is not the case of the Respondents that Appellants are

habitual defaulters in payment of rent. Therefore, Appellants cannot

be categorized as a defaulter to attract the definition of an

unauthorized occupant as contemplated by Rule 14 of the Enemy

Property Rules, 2015 or, as a ground for eviction of the Appellants as

provided in Clause 17 of the lease agreement.

Having regard to the discussion made above, this Court holds

the impugned letter and notice dated 07.01.2021 issued by the

respondents to be arbitrary and inconsistent with the terms and

conditions of the Lease Deed and assumption of jurisdiction by the

Estate Officer to be statutorily void, for which the relief sought by

Appellants are amenable to the jurisdiction under Article 226 of the

Constitution.

The impugned order under challenge is hereby set aside. The

Appeal with connected applications too stands disposed of accordingly

with no order as to costs.

The Writ Petition Shall return to the Hon'ble Single Bench to be

heard in merits.

MAT No.778 of 2021 along with I.A. No.C.A.N. 1 of 2021 and

I.A. No. C.A.N. 2 of 2021are accordingly disposed of.

There will be no order as to costs.

All parties shall act in terms of the copy of the order

downloaded from the official website of this Court.

Urgent Xerox certified photocopies of this judgment, if applied

for, be given to the parties upon compliance of the requisite

formalities.

I Agree,

(SubrataTalukdar, J.) (KesangDomaBhutia, J.)

Later

Ld. Counsel, Mr. Rudraman Bhattacharyya, appearing for the Respondents/Union of India prays for stay of operation of the order.

Stay of the order prayed for is considered and refused.

(SubrataTalukdar, J.) (KesangDomaBhutia, J.)