N.D.M.C. vs M/S. House Of Handicrafts And ...
1993 Latest Caselaw 355 Del

ORDER

B.N. Kirpal, J.

1. The respondent No. 1 had taken on license office space in what is commonly known as "Palika Parking" of Connaught Place, New Delhi, by virtue of a license deed dated 10th August, 1987. The space which was taken by the respondent No. 1 was 489 sq. feet and the license fee payable was Rs. 13,335/- per month. The license was for a period of five years and was subject to renewal on such terms and conditions as may be decided by the licensor.

2. According to the petitioner the respondent No. I committed default in payment of license fee. The petitioner then took action in terminating the license and initiated proceedings under Ss. 5 and 7 of the Public Premises (Eviction of Unauthorised Occupants) Act, 1971 before the Estate Officer. On 5th August, 1988 the Estate Officer passed an order directing the respondent No. 1 to vacate the premises and also pay arrears of license fee as well as damages and interest.

3. The respondent thereupon filed appeals before the Additional District Judge. The main contention which was raised before the Addl. District Judge was that no show cause notice was issued under clause 4 of the license deed before the cancellation of the license on 18th November, 1987. Because show cause notice was not issued the Addl. Distt. Judge came to the conclusion that the eviction orders which were passed were bad in law. The appeals against the eviction and levy of damages were accepted and it is this order which is challenged before us.

4. Learned counsel for the petitioner has drawn our attention to a letter dated 9th September, 1987 whereby the respondent No. 1 was required to deposit a sum of Rs. 44,465/- by 10th September, 1987 which represented arrears of license fee for the period ending3Ist August, 1987 plus interest thereon. When this money was not deposited a notice dated 5th October, 1987 was issued in which it was stated that the respondent had failed to comply with the aforesaid letter dated 9th September, 1987 and the arrears had not been paid and a further sum of Rs. 13,335 as license fee for the month of September, 1987 together with interest on the entire arrears had fallen due. In the said letter it was further stated that the respondent was thereby being served with a final notice that if the entire arrears were not deposited within seven days of the receipt of the notice the licensor wilt be compelled to cancel the license and action as permitted under the provisions of P.P.E. Act shall be initiated without any further notice or warning. This was followed by yet another letter dated 30th October, 1987 in which it was reiterated that arrears of license fee had not been paid and in the event of failure to pay the license fee the NDMC will be constrained to proceed legally without any notice or further warning at the respondent's risk and cost. These notices which were sent to the respondent were before the Addl. District Judge but no reference has been made to them in the impugned order of 10th January, 1992. On 18th November, 1987 the cancellation of the license was made by the Administrator and in the tatter of 11th January, 1988, which was also before the Addl. Distt. Judge, the respondent was informed about the passing of the said orders. According to clause 4 of the license deed if the license fee was not paid the licensor was given a right to determine the license and re-enter the premises in question by giving ten days notice in writing.

5. In our opinion, reading of the aforesaid three letters together viz., letters dated 9th September, 1987, 5th October, 1987 and 30th October, 1987 leave no manner of doubt that notice regarding arrears and the decision to terminate the license was given to the respondent before the actual order terminating the license was passed on 18th November, 1987. The conclusion of the Addl. Distt. Judge that no show cause notice was issued was, therefore, not correct. That apart, the order of the Addl. District Judge seems to have given a permission to the respondent to continue to remain in possession of the premises without paying any license fee. The Addl. Distt. Judge, curiously enough, and for no reason whatsoever, has not even directed the payment of the admitted license fee.

6. It is no doubt true that the case of respondent No. 1 throughout was that the premises were defective and there was seepage etc. and a loss had been caused to the respondent and the same premises could not be used. This is the contention which is also raised by the counsel for the respondent before us. Whether the premises was habitable or not was not for the Addl. Distt. Judge to go into because all that had to be seen was whether license fee was legally payable to the petitioner. That apart, we find that clause 1 of the license deed gives a right to the licensee to terminate the license by giving three months notice in writing. If the premises were inhabitable and loss was being suffered by the respondent, the obvious course of action for the respondent would have been to terminate the license. Admittedly this was not done. No damages were claimed by any action of the respondent in any Court of law. That apart the petitioner has today placed before us statement showing the consumption of electricity by the respondent and the respondent, on our direction, has also produced the telephone bills in respect to the telephone installed in the premises in question. The perusal of the two clearly shows that the office premises have been used by the respondent all along and, therefore, the contention that the said premises were inhabitable or were not being used does not seem to be correct.

7. A suggestion was also mooted during the pendency of this writ petition if an amicable solution could be found. On 10th February, 1993 the counsel for the respondent stated that the respondent would be willing to pay to the petitioner the arrears of license fee plus interest thereon within a period of three months as per the license deed and will also give an undertaking to the Court for the payment thereof and in case the payment was made the license will be renewed. Counsel for the petitioner took instructions and informed this Court that the license could be renewed only by increasing the license fee by 66%. The respondent, however, contended that in other cases license fee has been increased only by 5% and, therefore, the escalation of 66% was not warranted. We are now informed by Mr. Nayar that there has been an escalation of 5 to 15% in respect of shops in the Palika Bazar area but in respect of offices, and there are only two in number, the escalation is of 66% and the other licensee in this area has agreed to the increase in the license fee by 66% and the license has been renewed since 1992.

8. It is evident from the aforesaid that the respondent is willing to continue to occupy the premises in question as long as he finds the rate of license fee to be convenient. This itself will show that the contention of the respondent that the premises are inhabitable does not appear to be correct.

9. It is an admitted case that the original license period was five years and the total amount payable as per the license deed towards license fee was Rs. 8,10,000/-. According to the respondent a sum of Rs. 2,76,000/- has been paid. This figure is disputed by the counsel for the petitioner. We need not go into the correctness of this dispute and even assuming the figure indicated by the respondent to be correct it shows that there is an arrear of license fee and the same is payable by the respondent. Apart from anything else the principle of quantum merit must apply and the respondent having used the premises till today was bound to pay the license fee specially when it chose firstly, to challenge the correctness of the order of cancellation and, secondly, did not terminate the license deed on finding the premises to be inhabitable. It is clearly a case where the respondent has succeeded, uptil now in retaining the premises, using them and not paying any money to the licensor. The order of the Addl. Distt. Judge is clearly contrary to law and we, therefore allow the writ petition, issue a writ of certiorari quashing the said order of the Addl. Distt. Judge dated 10th January, 1992 and we restore the order of the Estate Officer.

10. The petitioner will also be entitled to costs.

11. Petition allowed.