Defence Estate Officer & Anr vs Indian Oil Corporation
2013 Latest Caselaw 515 Del

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*        IN THE HIGH COURT OF DELHI AT NEW DELHI

+        LPA 1010/2007

         DEFENCE ESTATE OFFICER & ANR                             ..... Appellant
                         Through: Ms Sonia Mathur, Adv.
                  versus

         INDIAN OIL CORPORATION                      ..... Respondent
                       Through: Mr Binder K. Nair, Adv.
         CORAM:
          HON'BLE THE CHIEF JUSTICE
          HON'BLE MR. JUSTICE V.K. JAIN

                ORDER

% 04.02.2013

The appellant allotted two plots of land, one at Gopinath Bazar, measuring 1254.5 square metres and other at Gurgaon Road, measuring 6600 square feet, to respondent No.1 Indian Oil Corporation, at the annual rent of Rs 13,043.20 and Rs 4,292/- respectively, for running petrol pump/ Filling-cum-Service Station to handicapped defence personnel, nominated by Director (Rehabilitation), Ministry of Defence. The plot of Gopinath Bazar was allotted to Flt. Lt. Ajit Kumar. The aforesaid plots were leased to respondent No. 1 for a period of five years.

2. The appellant vide letter dated 05.10.1992 and purporting to act pursuant to sanction issued by Government of India, Ministry of Defence vide its letter dated 16.04.1992 called upon respondent No. 1 to pay lease rent of Rs. 4,9052/- per annum for a period of 10 years with effect from

17.09.1981 to 16.09.1986 and Rs 53,957.20 per annum for the period from 17.09.1986 to 16.09.1991 in respect of the land on Delhi-Gurgaon Road. The respondent No. 1 was also asked to pay premium of Rs 2,45,260/- and 2,69,786/- respectively. After adjusting the amount already deposited by it, respondent No. 1 was required to deposit the arrears up to 16.09.1991. It was further informed that if the arrears were not paid, the same shall not be recovered under Section 7 of the Public Premises (Eviction of Unauthorized Occupants) Act, 1971 and the dealer would be evicted by sealing the petrol pump under the provisions of Section 5(c) of the said Act. Vide letter dated 07.10.1992, the appellant noticing that respondent No. 1 had failed to pay a sum of Rs 15,52,596.80/- in respect of land in Gopinath Bazar, required it to clear the arrears by 30.10.1992, failing which the said amount was to be recovered under Section 7(3) of the Public Premises (Eviction of Unauthorized Occupants) Act, 1971 and the dealer was to be evicted by sealing the petrol pump under the provision of Section 5(c) of the said Act.

3. The respondent No. 1 filed a writ petition, challenging the demand letters dated 05.10.1992 and 07.10.1992, issued by the appellant and also sought an order restraining them from evicting respondent No. 1 or its agents from properties in question and sealing the same. Another direction sought in the writ was to command the respondent to charge rent at the original rate and not at the revised rate.

4. The learned Single Judge vide order dated 29.11.2006 held that the appellant would be liable to renew the lease without seeking enhancement of rent till the allottees are fully rehabilitated or the disability of the handicapped personnel disappeared. This order was passed in the absence

of the learned counsel of any assistance on behalf of the appellant, since no counsel appeared for them, despite the matter remaining on Regular Board for a considerable period. In coming to this conclusion, the learned Single Judge took the view that enhancement of lease rent was in contravention of Rules 13 and 14 of Cantonment Land Administration Rules, 1937, which the learned Single Judge quoted in para 22 of the judgment.

5. When this matter was heard on 31.01.2013, we asked the learned counsel for the appellants to produce the copy of the lease deed executed in favour of respondent No. 1. A copy of the said lease deed has accordingly been produced before us and clause 6 of the deed reads as under:-

"6) At all times during the said term to keep the said petrol pump filling cum service station and premises in good and substantial repair and on the determination of the lease of the lessees are not granted a fresh lease of the site the petrol pump and other erections shall be cleared and all excavations shall be filled in to the satisfaction of the lessor within one month of the determination of lease.

It would thus be seen that unless a fresh lease in respect of land in question was granted, respondent No. 1 was required, on determination of the lease, to clear the site by removing petrol pump and other erections and filling up all excavations, within one month of determination of the lease. Admittedly, no fresh lease deed has been executed by the appellant in favour of respondent No.1 after expiry of the initial lease by afflux of time.

Therefore, going by the terms of the lease deed, respondent No. 1 cannot continue to occupy land in question and is required to remove the petrol pump as well as the other erections existing thereon as also fill the excavation made on the site.

6. Since there is no provision in the lease deed for its automatic renewal or for grant of a fresh lease on the same terms and conditions, which were stipulated in the initial lease deed, respondent No. 1 has no legal right to insist upon execution of fresh lease deed or extension of the initial lease on the same term which was stipulated at the time of grant of the initial lease. It is for the lessor of the land to decide whether to extend the lease/grant a fresh lease or not. If the lessor agrees to the request of the lessee to extend the lease/grant a new lease, it is well within its right to stipulate such conditions as it may deem appropriate and such conditions may include enhancement of lease rent to the extent deemed appropriate by the lessor. The erstwhile lessee has no legal right to insist upon extension of the lease/grant of a new lease on those very terms which were stipulated in the initial lease. If the revised rent sought by the appellant is not acceptable to respondent No.1, it would be well within its right to vacate the site which was leased out to it, but in that case it will have to pay damages to be determined by Estate Officer under the provisions of the Public Premises (Eviction of Unauthorized Occupants) Act, 1971 for the period it continued in illegal occupation of the aforesaid land.

7. Since the learned Single Judge has in para 22 of the impugned order extracted certain provisions stated to be Rules 13 to 16 of Cantonment Land Administration Rules, 1937, we specifically asked the learned counsel for

the parties to produce the said rules before us. No such rules have been produced by the learned counsel for respondent No.1, whereas the learned counsel for the appellant produced rules which did not have the provisions extracted in para 22 of the impugned order. The learned counsel for the appellants submitted that in fact these are extracts from certain letters and not statutory rules. According to her, the provision quoted as Rule 13 is in fact extract from Government of India, Ministry of Defence (ML&C) letter No.18/81/L/L & C/61/64 dated 05.10.1967 and provision quoted as Rule 14 is the extract GOI, Min. of Defence letter No. 10/52/L/L&C/64/3290/D (Lands) dated 12.04.1972 as amended vide corrigendum No. 18/152/L/L&C/64/10032/D (Lands) dated 13.10.1972, letter No. 18/52/L/L&C/64/Vol. III/D (Lands) dated 01.11.1973, letter No. 18/152/L/L&C/64/Vol.III/D (Lands) dated 20.04.1974, corrigendum No. 11013/2/76/D (Lands) dated 23.03.1976 and No. 11013/2/76/D (Lands) dated 29.05.1976) from Government of India. Similarly, the provision quoted as Rule 15 is the extract from GOI, Min. of Defence (DG DL&C) letter No. 18/152/L/L&C/64/(Review) dated 24.04.1980 and the provision quoted as Rule 16 is the extract from GOI, Min. of Defence (Dte Gen, DL&C) letter No. 35/24/L/L&C/67 dated 08.05.1979.

That being the position, it would not be correct to say that the enhancement of lease rent was in contravention of Cantonment Land Administration Rules, 1937.

8. Government of India letters quoted as Rule 14 in the impugned order also provide for revision of rent at the time of renewal of the lease taking

into account the relevant facts adopted by the Ministry of Works & Housing while revising the lease rent in respect of other Central Government lands leased out for retail outlet/service stations purposes and including the rent profits earned during the operation of the preceding lease. A perusal of the letter dated 16.04.1992, which was the basis of the letter dated 05.10.1992, issued by the appellant to respondent No. 1 would show that it was Government of India, Ministry of Defence, which decided to revise lease rent and premium. The appellant No.1 in issuing the letters dated 05.10.1992 and 07.10.1992 was only seeking to enforce the aforesaid decision dated 16.04.1992 of Government of India. The petitioner has not challenged the aforesaid decision dated 16.04.1992 of Government of India, Ministry of Defence. In the absence of any challenge to the said decision, the challenge to the consequent letters dated 05.10.1992 and 07.10.1992 is not maintainable in law. Had respondent No. 1 challenged the decision of the Government dated 16.04.1992, the said Government would have got an opportunity to defend the decision taken by it and explain the factors which it had taken into consideration while deciding the revised annual rent and premium and thereby satisfy the Court that there was no violation of its policy as conveyed vide letter dated 12.04.1972 and subsequent letters on the subject.

9. It was submitted by the leaned counsel for the respondent No. 1 that if the appeal is allowed and the writ petition is dismissed, they would have no option, but to close the petrol pump since their policy is not to revise the lease rent. If that is so and respondent No. 1 does not want to recover the

increased lease rent and premium from the dealer to whom, the petrol pump has been allotted, it will have either to bear the enhancement in lease rent and premium or change its policy and recover the enhanced rent and premium from the dealer. But, respondent No. 1 has no legal right to insist upon extension of lease/grant of new lease and that too on those very terms and conditions which were stipulated at the time of grant of the initial lease.

10. For the reasons stated, we are of the view that impugned order dated 29.11.2006 cannot be sustained. The said order is accordingly set aside and the writ petition is dismissed. We, however, make it clear that if the appellants take recourse of the provisions of the Public Premises (Eviction of Unauthorized Occupants) Act, 1971, either for the purpose of recovery of damages for use and occupation or for recovery of possession of the sites in question, they shall abide by the procedure prescribed in the said Act.

In the facts and circumstances of the case, there shall be no order as to

costs.

CHIEF JUSTICE

V.K. JAIN, J FEBRUARY 04, 2013 BG