Citation : 2015 Latest Caselaw 2865 Del
Judgement Date : 10 April, 2015
$~
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CS(OS) 618/2015
M/S ARESKO RESTAURANT
PVT LTD & ANR ..... Plaintiffs
Through Mr. A.S. Chandhiok, Senior
Advocate with Ms. Sweta
Kakkad, Advocate with Mr.
Chaitnya Kaushik, Advocates
versus
NEW DELHI MUNICIPAL
CORPORATION & ORS ..... Defendants
Through Mr. Sanjay Poddar, Senior
Advocate with Ms. Rachna
Golchha, Mr. Govind Kumar &
Ms. Pavni Poddar, Advocates
for NDMC.
Reserved on : 25th March, 2015
% Date of Decision : 10th April, 2015
CORAM:
HON'BLE MR. JUSTICE MANMOHAN
JUDGMENT
MANMOHAN, J:
I.A. 4714/2015 [U/o. 39 Rules 1 & 2 CPC]
1. Present suit has been filed for declaration, permanent and mandatory injunction by a licensee of NDMC restaurant ad measuring 2618 sq. ft. of covered area and 16,300 sq. ft. of open area situated adjacent to Lodi Garden. The prayer clause in the present suit is
reproduced hereinbelow:-
"a. A decree of declaration be passed in favour of the Plaintiff and against the Defendants declaring the communication dated 5th November, 2013, 3rd January, 2014, 29th January, 2014, advertisements dated 14th February, 2014 and 21st February, 2014 or any other decisions or resolution passed by the Defendants to be null and void and not binding on the Plaintiffs.
b. Decree of perpetual injunction be passed in favour of the Plaintiffs and against the Defendants restraining them from taking any action including the action of proposed auction in pursuance of advertisement dated 14th February, 2014 or any other advertisements that may be issued or caused to be issued subsequently seeking to auction the restaurant site in occupation of the Plaintiff located besides the gate of Lodhi garden (towards Jor Bagh) Opposite Mausam Bhawan, New Delhi.
c. Pass a decree of mandatory injunction commanding the Defendants to issue a formal letter of extension/renewal confirming the extension/the indenture dated 10th March, 2013 for a period of 10 years with enhancement of 10% licence fee every year with respect to the restaurant space situated besides the gate of Lodhi garden (towards Jor Bagh) Opposite Mausam Bhawan, New Delhi.
d. Alternatively, in case it is contended and held that an indenture is required to be executed then decree of mandatory injunction be passed in favour of the Plaintiff and against the Defendants directing them to complete the ministerial act and execute the indenture confirming the extension of the licence upto the Plaintiffs for a further period of 10 years at the enhanced amount of Rs. 59,213/- for the future extended period.
e. Decree of permanent injunction restraining the Defendants from in any manner interfering in the peaceful occupation of the site situated besides the gate of Lodhi garden (towards Jor Bagh) Opposite Mausam Bhawan, New Delhi or creating any impediment including disconnecting water / electricity or creating any other impediment in the functioning of the restaurant at the said site.
f. Costs of the suit may be in favour of the Plaintiffs
g. Pass such other or further order(s) as may be deemed fit and proper in facts and circumstances of the present case."
2. Mr. A.S. Chandhiok, learned senior counsel for plaintiffs submitted that the plaintiffs‟ licence with regard to Lodhi Restaurant stood renewed/extended for another period of ten years w.e.f. 05th July, 2013 after expiry of the ten years licence. He submitted that the right to seek extension/renewal in terms of Clause 1 of the Licence Deed was a vested right conferred upon the plaintiffs by way of an admitted document, i.e. Licence Deed dated 10th March, 2003. Since considerable emphasis was laid by him on Clause 1 of the Licence Deed, the same is reproduced hereinbelow:-
"1. That the licence is for a period w.e.f 5.7.2003 to 04.07.2013 on „As is where is basis‟ and thereafter it shall be the entire discretion of the licensor to renew the period of license. In case it is decided by the licensor that the license be renewed/extended for a further period as decided by the licensor from the day following the date on which the term of the license expires at a license fee calculated at the rate of license fee payable under the present license plus its renewal charges as decided by the
licensor or by the percentage as applicable under the Policy of the Council for the time being in force as monthly license fee of the renewed license provided the licensees exercise his/her/their option for renewal of license in writing for another term as decided by the licensor within 60 days before the date of expiry of the term of the present license and the licensees complete all the required formalities for renewal of license within the stipulated period of 60 days. In case the option for renewal is not so exercised and the formalities are not completed within stipulated period to the satisfaction of the licensor it shall be presumed that the licensees is not interested in further extension/renewal of his/her/their license beyond the date of expiry of term of the license and consequently the license shall stand determined ip-so- facto with effect from the date of expiry of the term of the present license and in the event of the licensees not surrendering the vacant possession of the stall within the stipulated period under this deed, the licensees shall render himself/herself/themselves liable for action for eviction and recovery of damages under Public Premises (Eviction of Unauthorized Occupants) Act, 1971."
(emphasis supplied)
3. Mr. Chandhiok pointed out that in D. Nataraja Mudaliar vs. The State Transport Authority, Madras, (1978) 4 SCC 290, the Apex Court has held, "the Authority must, remember that a permit holder has an ordinary right of renewal unless it is shown that outweighing reasons of public interest lead to a contrary result."
4. Mr. Chandhiok contended that the Estate Policies of NDMC of 1999 and 2000 provided for renewal of licence on payment of enhanced licence fee. The relevant portion of the Estate Policy of NDMC of 1999 is reproduced hereinbelow:-
"Estate Policy/Guidelines for dealing with Estate matters xxx xxx xxx Renewals
4. In the case of shops/stalls/kiosks/tharas/office units/restaurants etc. the licence will be renewed for a period of 10 years on year-to-year basis subject to enhancement in licence fee at the uniform rate by 7% per annum.
xxx xxx xxx
COUNCIL‟S DECISION
After detailed discussion & deliberations on various items of the Estate Policy, the Council approved this policy subject to the following modifications in the proposals:
1. That annual enhancement in license fee would be @ 5% as against 7% proposed earlier."
5. Mr. Chandhiok stated that the 2000 Estate Policy of NDMC only applied to hotels, cinemas, commercial complexes and not to restaurants which had been specifically dealt with in 1999 Estate Policy of NDMC.
6. Mr. Chandhiok submitted that the Estate Policies of 1999 and 2000 stood incorporated in the licence deed by virtue of the doctrine of incorporation. He stated that the plaintiffs exercised their right within the period of limitation provided in Clause 1 of the licence deed vide their letter dated 04th April, 2013 and in pursuance thereto NDMC accepted enhanced licence fee and consequently, the licence stood extended for another ten years automatically.
7. Additionally, Mr. Chandhiok submitted that Section 54 of the Easement Act, 1882 provides that a licence can be created by express or implied conduct of the guarantor. He stated that the defendants from July, 2013 to January, 2014 admitted the plaintiffs to be the licensee at enhanced fee and recovered the same. In support of his contention, Mr. Chandhiok relied upon certain file notings of NDMC officials which the plaintiffs had obtained under Right to Information Act, 2005. Some of the officials notings relied upon by Mr. Chandhiok are reproduced hereinbelow:-
"SUB: Renewal of licence of Restaurant at Lodi Garden The Allottee of above cited Restaurant has submitted his consent dated 04.04.2013 (Page 583/C) for renewal of licence for further 10 years as per policy of the Council. The Licence has been lying regularized in the name of M/s. Aresko Restaurants Private Ltd. through its Director Sh. Rajpal Singh Kochhar up to 04.07.2013 for running the trade of „Restaurant‟ as per licence deed placed at page 560/C. On perusal of the record, Report is as under:
1 Name of the Allottee M/s. Aresko
Restaurants Private
Ltd. through its
Director Sh. Rajpal
Singh Kochhar
2 Licence Renewed up to 04.07.2013 (as per
Licence Deed)
3 Licence Dee Page 560/C
4 Permitted Trade Restaurant‟
(licensable)
5 Any Transfer involved No
6 Any Court Case Pending Nil
7 Any Vigilance Case Nil
Pending
8 Unauthorized Nil Civil Report
Constructions if any 586/C
Outstanding dues Noting (328/N)
12 Whether Cancellation No
It is also mentioned here that previously LA has given his advise dated 03.07.2006 at page 324/N on the observation of then Chairperson, NDMC in respect of Fair Rent of the said Restaurant. Jt. Dir. (E) has given the clarification in his note at page 325/N has cleared mentioned that vide Reso. No.3(xxi) dated 30.08.2000 in Para 6 (iii) it has been mentioned that enhancement of Licence Fee on the renewal will be 10% per year and licence may be for a period of 10 yrs.
Section 141(2) has not applied for in this case, it applied for renewal in case of Hotel and the Cinema complex is on mutually agreed term. (Para 3 of Reso No.03(xxi) dated 30.08.2000. (Photocopy attached at Flat "X").
In view of above facts & circumstances, it is proposed that the licence of Double Storey restaurant at Lodhi Garden, near main gate Lodhi Garden towards Jor Bagh may be renewed for further 10 yrs. w.e.f. 05.07.2013 to 31.03.2023 on the licence fee worked out and annual enhancement as per policy of the Council from time to time for carrying the existing licensable trade of „Restaurant‟. It is also covered under Reso. No.06 dated 18.03.1999.
The proposal may be submitted to Competent Authoritiy/Dir. (Estate) for his kind approval of renewal of the licence of above mentioned premises for a period of up to 31.03.2023 in the name M/s. Aresko Restaurants Private Ltd. through its Director Sh. Rajpal Singh Kochhar, subject to completion of requisite formalities like submission of a Non-judicial Stamp Paper worth of Rs.50/- for execution of Licence Deed and deposit the Addl. Security equivalent of 8 months of current Licence Fee (after adjusting the previous security paid) etc.
Submitted pleased.
(Sd/-) 25/6/13 SO(E) Director (Estate-I) may kindly see for necessary orders.
DD(E) (on leave)
DIR(E)
(Sd/-)
25/06/13
xxx xxx xxx
xxx xxx xxx
Regarding Market Rent/Fair Rent
As far as the current market rates is concerned, it is also resolved vide Reso. No.3(xxi) dt. 30.8.2000, that on the expiry of present terms of licence of hotels/cinema, the licence shall not be renewed. The fresh licence shall be as per provision of Section 141(2) of the NDMC Act, 1994.
That nearby of Double Storey Restaurant at Lodi Garden, there are two markets one is Pandara Road Market & few Restaurants are in Main Market, Lodhi Road. In Pandara Road market shop No.3 is paying the highest rate of licence fee of Rs.48,394/- per month for an area of 217 sqft which comes to Rs.223/ Psft.
The total built up area of the said restaurant is 2618 sqft for sitting purpose whereas open space is 16,300 sqft. In past we were charging normal rate for the open space @ Rs.0.20 Psft per month as per licence deed executed in 1983. However, on the same calculation for the last 30 years, the rate would be Rs.6.00 Psft approx. at present.
In view of above, it is proposed that we can fix the license fee of the Restaurant, in question, on competitive rate of the Restaurants situated in Pandara Road market for the space of 2618 sqft @ Rs.223/- Psft i.e. Rs.5,83,814/- + Rs,97,800/- (16,300 sqft open space x Rs. 6/-) total of Rs.6,81,614/- pm on the higher side.
Submitted for kind information & further orders please.
(Sd/-)
18/9/13
SO(E) (Sd/-)
DD(E) 18/9/13"
8. Consequently, according to Mr. Chandhiok the licence stood extended explicitly as well as in terms of Section 54 of the Easement Act, 1882.
9. On the other hand, Mr. Sanjay Poddar, learned senior counsel for defendant-NDMC stated that premises in question had been given on licence to the plaintiffs for a period of ten years with effect from 5th July, 2003. He stated that the competent authority of defendant-NDMC had taken a decision not to renew the licence beyond 4 th July, 2013 and had also decided to award a fresh licence after auctioning the same.
10. Mr. Poddar stated that the defendant-NDMC had conveyed its decision to the plaintiffs vide letter dated 5th November, 2013. He, however, stated that the plaintiffs did not accept the offer of first refusal given in the letter dated 5th November, 2013. He stated that the defendant-NDMC subsequently vide its letter dated 21st February, 2014 withdrew the first refusal offer in view of the Resolution dated 29th January, 2014 passed by its highest decision making body, namely, the Council. Mr.Poddar pointed out that consequently a public notice for inviting bids had been issued by defendant-NDMC on 14th February, 2014.
11. Mr. Poddar submitted that the argument of deemed extension of licence was misconceived and had been rejected by this Court in both the cases of M/s. Gesture Hotels and Foods Pvt. Ltd. Vs. New Delhi Municipal Council, 2014(209) DLT 784, M/s. Gesture Hotels and Foods Pvt. Ltd. Vs. New Delhi Municipal Council, 2014 (210) DLT 359 (DB) and Chandu Lal Etc. Vs. Municipal Corporation of Delhi, ILR (1978) I Delhi 292.
12. Mr. Poddar further submitted that plaintiffs‟ reliance on NDMC policy dated 18th March, 1999 was misconceived as the same related to increase in licence fee for rehabilitation markets and other scattered units in various NDMC markets which were governed by the earlier resolutions. He pointed out that Para 9 of the said Policy itself stated that the hotels, cinemas and other similar projects would be governed by mutually agreed terms and conditions as entered into by the Council from time to time. He contended that NDMC Policy of 1999 was not applicable to the present case as the premises in question fell in the excluded category and was not situated in a rehabilitation market.
13. Mr. Poddar pointed out that defendant-NDMC‟s subsequent policy dated 30th August, 2000 clearly stipulated that cases relating to hotels, cinemas and other similar projects would be governed by Section 141(2) of the New Delhi Municipal Council Act, 1994 (for short "NDMC Act) and such licences could not be renewed. In support of his submission, Mr. Poddar relied upon the judgments of this Court in M/s. Gesture Hotels and Foods Pvt. Ltd. (supra), M/s. Gesture Hotels and Foods Pvt. Ltd. (supra) and judgment of the Supreme Court in Aggarwal & Modi Enterprises (P) Ltd. and Another Vs. New
Delhi Municipal Council, (2007) 8 SCC 75.
14. Mr. Poddar reiterated that as the decision to put the premises on auction had been taken by defendant-NDMC‟s highest authority, that means, the Council in its meeting held on 29th January, 2014 in exercise of its power vested in it under Section 141 of the NDMC Act, such a decision would override any general policy decision issued earlier.
15. Mr. Poddar submitted that though the present suit was actually for specific performance of a renewal clause in a Licence Deed, yet the plaintiffs realizing that such a suit was not maintainable had camouflaged it as a suit for declaration, permanent and mandatory injunction. He submitted that the plaint did not disclose any cause of action for grant of relief of renewal and, therefore, the same was required to be dismissed under provisions of Order 7 Rule 11 CPC.
16. He stated that keeping in view the mandate of Section 64 of the Easement Act, 1882, the plaintiff-licensee was only entitled to claim damages in the event of wrongful termination of the license by the licensor.
17. Mr. Poddar lastly pointed out that the plaintiff-licensee in its earlier writ petition being W.P.(C) 986/2014 had filed an undertaking that it would hand over peaceful vacant possession of the premises in case the decision of the writ court went against it and it remained unsuccessful in the appellate forum as it was agreed that in that event the defendant-NDMC would not be obliged to take recourse to the proceedings under the Public Premises Act for recovery. He stated that admittedly the plaintiffs had withdrawn the said writ petition and
consequently, the plaintiffs were required to hand over vacant possession of the premises in terms of their undertaking.
18. In rejoinder, Mr. Chandhiok stated that the renewal clause in M/s. Gesture Hotels and Foods Pvt. Ltd. (supra) and in the present case were not identical. He pointed out that in M/s. Gesture Hotels and Foods Pvt. (supra) the renewal clause stated "it shall be the entire discretion of the licensor to extend or not to extend the period of license." whereas in the present case the renewal clause stated "it shall be the entire discretion of the licensor to renew the period of license". Mr. Chandhiok contended that the omission of the words "or not" in the present case was significant. He submitted that the discretion in Clause 1 of the licence was neither absolute nor unrestricted or unfettered.
19. Mr. Chandhiok repeatedly emphasised that there was a distinction between renewal/extension and fresh allocation of licence. He pointed out that in the case of Mohd. Yunus Prevez Vs. Agriculture Marketing Produce Committee, W.P.(C) 3349/2007 decided on 4th August, 2009 a learned Single Judge of this Court had held that the parameters applicable in the case of renewal of licence are different from the parameters applicable in the case of a fresh licence.
20. Mr. Chandhiok contended that the communication dated 5th November, 2013 cannot be termed as an offer as contended by the defendants as it was a decision. He also contended that the NDMC Policy of 1999 was not confined to rehabilitation markets.
21. Mr. Chandhiok further submitted that the judgment of the
Supreme Court in Aggarwal & Modi Enterprises (P) Ltd. and Another (supra) was per incuriam as the said judgment did not consider the extant provisions of law. According to him, the Apex Court failed to appreciate that the expression "otherwise transfer" in Section 141 of NDMC Act related to transfer by sale or creation of lease at best and nothing more. In support of his contention, he relied upon Section 2(47) of Income Tax Act, 1961 which defines the word "transfer" as including any transaction involving allowing of possession of any immovable property to be taken. He stated that in the present case there was no transfer as only a bare licence had been given to the plaintiffs.
22. Mr. Chandhiok stated that the submission of the defendants that public auction was the only means to maximise the consideration, was erroneous as held by the Constitution Bench in Natural Resources Allocation, in Re, Special Reference No. 1 of 2012, (2012) 10 SCC 1.
23. Mr. Chandhiok further stated that as the licence clearly provided that the plaintiffs would not be entitled for compensation, damages was not an adequate remedy as contended by learned senior counsel for the defendants.
24. Mr. Chandhiok lastly submitted that the plaintiffs had been singled out as other licences in favour of restaurant owners had been extended, like Delhi Darbar and Kake da Hotel.
25. Having heard learned counsel for the parties, this Court is of the view that it is an admitted position that the plaintiffs had been given a bare licence for a specific purpose of running a restaurant which has expired by efflux of time on 4th July, 2013.
26. Clause 1 of the licence deed confers an absolute right / discretion upon the licensor-NDMC to decide whether to renew the period of licence or not. In the opinion of this Court, the deletion of the expression "or not" in the present renewal clause makes no difference to the meaning and import of the renewal clause. In fact, the expression "or not" was otiose and redundant even in the case of M/s. Gesture Hotels and Foods Pvt. Ltd. (supra). Consequently, there is no distinction between the renewal clause in the present case and that of M/s. Gesture Hotels and Foods Pvt. Ltd. (supra). The renewal clause in both the cases confers absolute power and discretion upon the defendant-NDMC to decide as to whether to renew the period of licence.
27. Even Clause 13 of the licence deed in the present case categorically states that the licence was renewable at the will of licensor. Clauses 35, 36 and 45 of the licence deed clearly stipulate that plaintiff-licensee shall hand over vacant possession on expiry of the licence period. Consequently, this Court is of the view that Clause 1 of the licence deed executed between the parties confers absolute discretion upon the defendant-NDMC to renew or to terminate the licence.
28. It is settled principle of law that a licensee has no legal right to stay in the property after termination of the licence. A learned Single Judge of this Court in Thomas Cook (India) Limited Vs. Hotel Imperial & Ors., 2006 (127) DLT 431 has held as under:-
"26. The nature of occupancy is clearly permissive. In fact it does not amount to possession at all. The relationship
between the plaintiff and the defendant in terms of the compromise decree was that of Licensor and Licencee and not Lessor and Lessee. The plaintiff had use of the two rooms under a licence. A licence does not create any interest in the property. It merely permits another person to make use of the property. There is no parting with possession as the legal possession continues with the owner (licensor). In C.M. Beena v. P.N. Ramachandra Rao: (2004) 3 SCC 595, the Supreme Court held:--
"Only a right to use the property in a particular way or under certain terms given to the occupant while the owner retains the control or possession over the premises results in a licence being created; for the owner retains legal possession while all that the licensee gets is a permission to use the premises for a particular purpose or in a particular manner and but for the permission so given the occupation would have been unlawful (See Associated Hotels of India Ltd. v. R.N. Kapoor [AIR 1959 SC 1262])"
What is meant by parting with legal possession has been explained by the Supreme Court in the context of sub-letting in the case of Delhi Stationers and Printers v. Rajendra Kumar: (1990) 2 SCC 331 (paragraph 5) in the following words:--
"Parting of the legal possession means possession with the right to include and also a right to exclude others. Mere occupation is not sufficient to infer either sub-tenancy or parting with possession."
Keeping these legal principles in mind, there is no doubt that the plaintiff merely had a right to use the two rooms. It cannot be said that the plaintiff was in possession thereof. This is clear from the facts, as aforesaid, that under the compromise decree the plaintiff was obligated to leave the keys of the rooms at the reception at the close of each day; the plaintiff was charged a daily tariff; the control and possession of the rooms was explicitly retained by the defendants; the rights of admission were reserved with the
defendants. Under these circumstances it cannot be said by any stretch of imagination that the defendants had parted with possession or that the plaintiff was in "possession" of the said two rooms even during the period prior to the revocation of the licence. Therefore, Mr. Kaul's reliance on all those decisions with deal with the question of dispossession without due process is misplaced. For, the plaintiff had a mere right to use, it never was in possession of the said two rooms, much less, in settled possession in which the defendants had acquiesced.
27. This brings me to the second aspect of „due process of law‟. It was urged by Mr Kaul that even if the plaintiff was in unlawful possession it could only be evicted by due process of law and therefore the plaintiff was entitled to an order of injunction preventing the defendants from removing the plaintiff from the said two rooms except through due process of law. It must be made clear that this argument fails in the context of this case because the plaintiff was never in possession and therefore there is no question of dispossession in the sense usually understood. The plaintiff had a mere right to use, such right was revocable, it has been revoked and the plaintiff is entitled under section 63 of the Indian Easements Act, 1882 to a reasonable time to leave the premises and take away its goods. The argument also fails because by rushing to court the plaintiff has indeed invited a judicial determination of its status. If it got an order of injunction it would enure to its benefit. But, if it did not, then it can't be heard to say that this court has to grant an injunction all the same because otherwise it would give a licence to the defendants to forcibly throw out the plaintiff without filing a suit for possession.
28. The expressions „due process of law‟, „due course of law‟ and „recourse to law‟ have been interchangeably used in the decisions referred to above which say that the settled possession of even a person in unlawful possession cannot be disturbed „forcibly‟ by the true owner taking law in his
own hands. All these expressions; however, mean the same thing--ejectment from settled possession can only be had by recourse to a court of law. Clearly, „due process of law‟ or „due course of law‟, here, simply mean that a person in settled possession cannot be ejected without a court of law having adjudicated upon his rights qua the true owner. Now, this „due process process‟ or „due course‟ condition is satisfied the moment the rights of the parties are adjudicated upon by a court of competent jurisdiction. It does not matter who brought the action to court. It could be the owner in an action for enforcement of his right to eject the person in unlawful possession. It could be the person who is sought to be ejected, in an action preventing the owner from ejecting him. Whether the action is for enforcement of a right (recovery of possession) or protection of a right (injunction against dispossession), is not of much consequence. What is important is that in either event it is an action before the court and the court adjudicates upon it. If that is done then, the „bare minimum‟ requirement of „due process‟ or „due course‟ of law would stand satisfied as recourse to law would have been taken. In this context, when a party approaches a court seeking a protective remedy such as an injunction and it fails in setting up a good case, can it then say that the other party must now institute an action in a court of law for enforcing his rights i.e., for taking back something from the first party who holds it unlawfully, and, till such time, the court hearing the injunction action must grant an injunction anyway? I would think not. In any event, the „recourse to law‟ stipulation stands satisfied when a judicial determination is made with regard to the first party's protective action. Thus, in the present case, the plaintiff's failure to make out a case for an injunction does not mean that its consequent cessation of user of the said two rooms would have been brought about without recourse to law.
(emphasis supplied)
29. As rightly pointed out by the learned senior counsel for the defendants, the view taken by learned Single Judge in Thomas Cook (India) Limited (supra) was approved by the Supreme Court in Maria Margarida Sequeira Fernandes and Others Vs. Erasmo Jack De Sequeira (Dead) Through LRs, (2012) 5 SCC 370.
30. This Court is also of the view that mere acceptance of the licence fee subsequent to revocation of licence would not mean that NDMC had extended the term of licence. It is well settled that merely on acceptance of licence fee after its determination would not amount to deemed extension. In Chandu Lal Etc.(supra) a Full Bench of this Court has held as under:-
"34. Shri Saigal next contended that or revocation of the license, the petitioners possession of the Kiosks was that of trespasser and having accepted license fee subsequent to the revocation of the license, the Corporation acquiesced in the possession of the petitioners as trespassers, in the circumstances the Corporation has no right to dispossess the petitioners by force. This submission is equally devoid of force. In accepting license fee subsequent to the revocation of the license, all that can be said is that the license was extended up to the period the license fee was accepted but it cannot be said that the Corporation in any manner acquiesced in the alleged trespass or that the petitioners came to acquire "settled possession". The basic fallacy in this argument is the assumption that on acquiring liberty to occupy the Kiosk possession of it was passed to the petitioners. The petitioners being licensees legal possession all along remained with the Corporation. That being so, as held by the Supreme Court in Munshi Ram & Ors. v. Delhi Administration, AIR 1968 SC 702, the Corporation had a right to reenter the premises and reinstate itself provided it does not use more force than necessary. Such an entry would be received only as a resistance to an intrusion upon
possession which had never been lost. Further, the law does not require a person whose property is forcibly tried to be occupied by trespassers to run away and seek the protection authorities, there being nothing more degrading to the human spirit than to run away in the face of peril."
(emphasis supplied)
31. The plaintiffs reliance upon internal noting of defendant-NDMC is contrary to facts and untenable in law. In fact, after the internal notings referred to by Mr. Chandhiok, the Chairman of NDMC and Council had given cogent reasons underlying their decision to auction the premises. The relevant portion of the decision of Chairman and Council are reproduced hereinbelow:-
"Chairman, NDMC Notings prepages refer. In principles I agree with the premise of open auction with price discovery as automatic benefit. However, the last, conscious decision in r/o such a situation, taken by the Council in case of Hotel Taj Man Singh, is of Dec‟12 wherein open auction with first right of refusal to be given to the last lease- holder/license holder, has been enunciated as a principle. In the instant case also, I am inclined to follow exactly the same principle, well established in the Council‟s resolution of Dec 12, till the council itself, in some future meeting, deviates from its own earlier decision/resolution and revises or amends it. Till then, it is the principle.
We may make all preparations for open auction at the earliest with FRR to the existing licensee. The reserve price may be arrived at as per calculation at „X‟; of page 335/N ante.
(Sd/-) 23.9.13"
Council‟s Decision
xxx xxx xxx
M/s. Aresko Restaurants Pvt. Ltd vide dated 7.5.2013 have applied for further renewal of the licence for a period of ten years w.e.f. 5.7.2013. The case was processed. The current licence fee which is being paid is Rs. 59,213/- per month.
In this regard, in terms of para 6(i) of the Council Reso. No.3(xxi) dated 30.8.2000 on the expiry of present term of licence of hotels/cinema and other similar commercial complexes, the licence shall not be renewed. The fresh licence shall be as per provision of Section 141(2) of the NDMC Act, 1994.
Accordingly, it was considered appropriate to give the property at the gate of Lodhi Garden in open auction at the prevailing market rates as the different between the licence fee being received from M/s. Aresko Restaurants Pvt. ltd and the market rate of comparable properties is huge. So in order to safeguard revenue, M/s. Aresko Restaurants Pvt. Ltd. has already been informed through a written communication as per decision taken by the competent authority that the property in question will be put to open auction with First Right to Refusal to the present occupant/licensee and they have also been informed to pay damages at the rate of Rs.6,81,614/- per month after the expiry of the licence. Further, the decision of the Council taken in some other cases of Estate Department like Taj Man Singh Hotel is consistently for open tendering or for open auction of premises with First Right to Refusal to be given to the licensee. This was followed as principle even in the present case till the Council itself, in some future meetings, deviates from its own earlier decision/resolution and revises or amends the relevant Section 141(2) of NDMC Act."
32. In any event, the Apex Court in a catena of judgments has held that an internal noting cannot be treated as a decision of the
Government. The Supreme Court in Delhi Union of Journalist Cooperative House Building Society Ltd. & Ors. vs. Union of India & Ors., 2013 (11) Scale 177 has held as under:-
"17. In Shanti Sports Club and Anr. v. Union of India and Ors. (supra), a similar question was considered in the context of noting recorded by the then Minister, Urban Development for release of the acquired land in favour of the Appellant. While rejecting the Appellants' prayer, this Court referred to the earlier judgments and held:
"All executive actions of the Government of India and the Government of a State are required to be taken in the name of the President or the Governor of the State concerned, as the case may be [Articles 77(1) and 166(1)]. Orders and other instruments made and executed in the name of the President or the Governor of a State, as the case may be, are required to be authenticated in such manner as may be specified in rules to be made by the President or the Governor, as the case may be [Articles 77(2) and 166(2)]. Article 77(3) lays down that:
"77.(3) The President shall make rules for the more convenient transaction of the business of the Government of India, and for the allocation among Ministers of the said business.
Likewise, Article 166(3) lays down that:
166.(3) The Governor shall make rules for the more convenient transaction of the business of the Government of the State, and for the allocation among Ministers of the said business insofar as it is not business with respect to which the Governor is by or under this Constitution required to act in his discretion.
This means that unless an order is expressed in the name of the President or the Governor and is
authenticated in the manner prescribed by the rules, the same cannot be treated as an order on behalf of the Government.
A noting recorded in the file is merely a noting simpliciter and nothing more. It merely represents expression of opinion by the particular individual. By no stretch of imagination, such noting can be treated as a decision of the Government. Even if the competent authority records its opinion in the file on the merits of the matter under consideration, the same cannot be termed as a decision of the Government unless it is sanctified and acted upon by issuing an order in accordance with Articles 77(1) and (2) or Articles 166(1) and (2). The noting in the file or even a decision gets culminated into an order affecting right of the parties only when it is expressed in the name of the President or the Governor, as the case may be, and authenticated in the manner provided in Article 77(2) or Article 166(2). A noting or even a decision recorded in the file can always be reviewed/reversed/overruled or overturned and the court cannot take cognizance of the earlier noting or decision for exercise of the power of judicial review.
(emphasis supplied)
18. By applying the ratio of the aforesaid judgment to the facts of this case, we hold that note dated 2.12.1999 recorded by the Minister, Urban Development cannot be made basis for quashing the allotment made in favour of respondent No.4"
(emphasis supplied)
33. Further, this Court is of the view that plea of discrimination with all material particulars has not been taken in the plaint. In any event, it is settled law that Article 14 of the Constitution is a positive concept
and cannot be enforced in a negative manner. The illegality or irregularity cannot be perpetuated on the ground that illegal benefits have been extended to others. In Union of India and Others vs. M.K.
Sarkar, (2010) 2 SCC 59, the Supreme Court has held as under:-
"25. There is another angle to the issue. If someone has been wrongly extended a benefit, that cannot be cited as a precedent for claiming similar benefit by others. This Court in a series of decisions has held that guarantee of equality before law under Article 14 is a positive concept and cannot be enforced in a negative manner; and that if any illegality or irregularity is committed in favour of any individual or group of individuals, others cannot invoke the jurisdiction of courts for perpetuating the same irregularity or illegality in their favour also on the reasoning that they have been denied the benefits which have been illegally extended to others. (See Chandigarh Admn. v. Jagjit Singh[(1995) 1 SCC 745] , Gursharan Singh v. NDMC [(1996) 2 SCC 459] , Faridabad CT Scan Centre v. D.G. Health Services [(1997) 7 SCC 752] , State of Haryana v. Ram Kumar Mann [(1997) 3 SCC 321 : 1997 SCC (L&S) 801] , State of Bihar v. Kameshwar Prasad Singh [(2000) 9 SCC 94 : 2000 SCC (L&S) 845] and Union of India v.International Trading Co. [(2003) 5 SCC 437] )
26. A claim on the basis of guarantee of equality, by reference to someone similarly placed, is permissible only when the person similarly placed has been lawfully granted a relief and the person claiming relief is also lawfully entitled for the same. On the other hand, where a benefit was illegally or irregularly extended to someone else, a person who is not extended a similar illegal benefit cannot approach a court for extension of a similar illegal benefit. If such a request is accepted, it would amount to perpetuating the irregularity. When a person is refused a benefit to which he is not entitled, he cannot approach the
court and claim that benefit on the ground that someone else has been illegally extended such benefit. If he wants, he can challenge the benefit illegally granted to others. The fact that someone who may not be entitled to the relief has been given relief illegally, is not a ground to grant relief to a person who is not entitled to the relief."
(emphasis supplied)
34. This Court is of the view that the Constitution Bench judgment in Natural Resources Allocation, In Re. Special Reference No.1 of 2012 (supra) has no application to the facts of the present case as in the said case the Court had only observed that alienation of natural resources is a policy decision and the means adopted for the same are executive prerogatives and auction as a mode of distribution cannot be conferred the status of a constitutional principle. But in the present instance, the executive has taken a decision on its own to execute a new licence for the restaurant after auctioning the same in accordance with its statute.
35. This Court is also in agreement with Mr. Poddar‟s submission that the 18th March, 1999 NDMC Policy deals with rehabilitation markets and not with commercial properties/complexes like restaurants. This would be apparent from the following paragraphs of the 1999 Estate Policy of NDMC. The same are reproduced hereinbelow:-
" xxx xxx xxx These issues mainly relates to the increase in licence fee for rehabilitation markets and other scattered units in various NDMC markets which are governed under resolution No. 55 dated 7.7.78 read with resolution No.1 dated 21.7.78 which are on the lower side taking into
consideration the prevailing trends in the markets and to bring uniformity on renewals made after every ten years for shops, stalls, kiosks, tharas office spaces etc.
1. General enhancement of licence fee At the annual rate of 7% irrespective of the category of property (rehabilitation licencees, tendered shops, earlier rehabilitated markets, reserved categories etc.).
xxx xxx xxx
9. Special categories
Hotels, cinemas and similar projects etc. may be governed as per mutually agreed terms and conditions as entered into by the Council from time to time."
(emphasis supplied)
36. It is pertinent to mention that an identical argument of renewal based on 1999 Policy of NDMC was rejected by a learned Single Judge of this Court in M/s. Gesture Hotels and Foods Pvt. Ltd. (supra). The relevant portion of the aforesaid judgment is reproduced hereinbelow:-
"18. Plaintiff in the plaint has extracted incomplete Clause (I) of the licence agreement and when the complete Clause (I) is compared with the extracted portion of Clause (I) of the licence agreement in the plaint, it is apparent why the plaintiff has extracted only a portion of the said Clause. The comparison between the clause quoted by the plaintiff and the actual clause (I) is as under:
Clause quoted by the plaintiff Complete Clause (I) .................... it shall be That the licence shall be for renewed/extended for a a period of 10 years ending further period as decided by upto 11-7-2012 and the Licensor from the day thereafter it shall be the following the date on which entire discretion of the the term of the Licence licensor to extend or not to expires ............... provided extend the period of licence. Licencee exercises his In case it is decided by the option for renewal of licensor that the licence be
Licence in writing for renewed/extended, it shall be another term of 10 years renewed/extended for a within 60 days before the further period as decided by date of expiry in the present the Licensor from the day Licence and the Licencee following the date on which completes all the required the term of the Licence formalities for renewal of expires at a monthly licence Licence within the fee payable under the present stipulated period to the licence plus its 5% (or by the satisfaction of the Licensor, percentage as applicable it shall be presumed that the under the policy of the Licensee is not interested in council for the time being in further extension/renewal of force) as monthly licence fee his/her Licence beyond the of the renewed licence date of expiry of the term of provided the licensee the Licence ......... exercises his option for renewal of Licence in writing for another term of 10 years within 60 days before the date of expiry in the present Licence and the Licencee completes all the required formalities for renewal of Licence within the stipulated period of 60 days. In case the option for renewal is not so exercised and/or the formalities are not completed within the stipulated period to the satisfaction of the Licensor, it shall be presumed that the Licensee is not interested in further extension/renewal of his/her Licence beyond the date of expiry of the term of the Licence and in the even of the licensee not surrendering the vacant possession of the shop within the stipulated period under this deed, the
licensee shall render himself/herself liable for action for eviction and recovery of damages under the Public Premises (Eviction of Unauthorised Occupants) Act, 1971. (portion extracted by plaintiff is underlined)
xxxx xxxx xxxx xxxx
22. The policy dated 18.03.1999 relied upon by the plaintiff deals mainly with the issue relating to the increase in licence fee for rehabilitation of markets and other squatter units in NDMC markets which are governed under resolution 55 dated 07.07.1987 read with resolution No. 1 dated 07.07.1978. The reference to renewal in the said policy is only for the purposes of the enhancement of the licence fee on unit basis.
xxxx xxxx xxxx xxxx
26. For the purposes of seeking specific performance of a term of a licence, it is necessary that there should be an obligation on the defendants to renew the term of the licence under the agreement. Where there is no obligation on a party to do a particular act, the specific performance of such an obligation cannot be sought. The specific performance can be sought of an obligation which is mandatory. Where discretion is given to the party to perform or not to perform the obligation and the discretion is unfettered or absolute, specific performance cannot be granted.
xxxx xxxx xxxx xxxx
28. The licence agreement stipulates that the allotment of the licensed premises in favour of the licensee was purely temporary which could be revoked at any point of time without assigning any reason and in the event of the revocation, the licencee was bound to evict the premises without any claim for compensation.
xxxx xxxx xxxx xxxx
33. There is no contractual terms between the parties that makes it obligatory for the defendants to renew the licence. On the
contrary, the clauses give an absolute discretion to the defendants to renew or not to renew the terms of the licence.
xxxx xxxx xxxx xxxx
37. Similarly, in the present case, the rights and obligations of the plaintiff would be governed by the licence granted to the plaintiff. The terms of the licence would be insulated from the tentacles of any statutory law or policy and would be beyond the reach of any restrictive provision contained in the same. The licence confers unfettered discretion on the defendant to renew or not to renew the terms of the licence and any contrary provision of statute or policy would be overridden by the terms of the licence.
xxxx xxxx xxxx xxxx
39. The Division Bench in the case of RAJASTHAN BREWERIES LTD. (SUPRA) has laid down that Specific performance will not be ordered where damages are adequate remedy or where the party applying for relief is guilty of a breach of the contract or is guilty of wrongful conduct or where the contract involves personal service or where the contract requires constant supervision or where the party against whom specific performance is sought is entitled to terminate the contract. If the party against whom specific performance is sought, is entitled to terminate the contract, the order will be refused as the defendant could render the direction to perform nugatory by exercising his powers to terminate. This principle has been held to be applicable whether the contract is terminable under its express terms or on account of the conduct of the party seeking specific performance. Further it has been laid down that clause (e) of Section 41 of the Specific Relief Act, 1963 lays down that injunction cannot be granted to prevent the breach of contract, the performance of which would not be specifically enforced. If it is found that a contract which by its very nature is determinable, the same not only cannot be enforced but in respect of such a contract no injunction could also be granted and this is mandate of law. This, however, has been held subject to the exception that where a contract comprises an affirmative agreement to do a certain act, coupled with a negative agreement, express or implied, not to do a certain act, the circumstances that the court is unable to compel specific performance of the affirmative agreement shall not preclude it from granting an injunction to
perform the negative agreement. The Division Bench has further held that if it is ultimately found that termination was bad in law or contrary to the terms of the agreement or of any understanding between the parties or for any other reason, the remedy of the plaintiff would be to seek co mpensation for wrongful termination but not a claim for specific performance of the agreements."
(emphasis supplied)
37. The aforesaid judgment of the Single Judge was upheld by the Division Bench in M/s. Gesture Hotels and Foods Pvt. Ltd. (supra) wherein it was held as under:-
"10. We have at the outset invited the attention of the senior counsel for the appellant/plaintiff to Section 64 of the Indian Easement Act, 1882 which provides that where a licence has been granted for a consideration and the licensee, without any fault of his own is evicted by the grantor before he has fully enjoyed under the licence the right for which he contracted, he is entitled to recover compensation from the grantors and have enquired from the senior counsel whether not the same is indicative of an agreement, even if any of the renewal of licence, being incapable of specific performance and even if the licensee has a right of renewal and the licensor wrongfully denies such renewal, the claim if any of the licensee would be for damages/compensation only.
xxxx xxxx xxxx xxxx
13. Reference in this regard can be made to The Corporation of Calicut v. K. Sreenivasan AIR 2002 SC 2051 laying down that under Section 64 even if a licensee is evicted, though grounds for revocation of licence do not exist, or forcefully evicted, his only remedy is to recover compensation from grantor and not to resume occupation. The same view is also taken by a Division Bench of the Kerala High Court in FAO No. 63/2013 titled as Trivandrum Golf Club v. State of Kerala. One of us
(Rajiv Sahai Endlaw, J.) also in Keventer Agro Ltd. v. Kalyan Vyapar Pvt. Ltd. MANU/DE/1479/2013 and FAO(OS) No. 278/2013 preferred whereagainst was dismissed by a Division Bench of this Court on 30.05.2013, has taken the same view and which was subsequently also taken in Ashok Kumar v. Paramjeet Kaur MANU/DE/ 3900/2013.
14. In view of the aforesaid legal position and when in terms of the same the appellant/plaintiff has no chance of succeeding in the claim for specific performance, the question of protecting the possession of the appellant/plaintiff in the interregnum does not arise.
xxxx xxxx xxxx xxxx
19. We, on a reading of the renewal clause aforesaid in the licence are satisfied that the renewal thereof was in the sole discretion of the respondent/defendant. The appellant/ plaintiff thus cannot force the respondent/ defendant to renew the lease."
(emphasis supplied)
38. In any event, Section 141(2) of the New Delhi Municipal Council Act reads as under:-
"141. Disposal of immovable property.
xxx xxx xxx (2) The consideration for which any immovable property may be sold, leased or otherwise transferred shall not be less than the value at which such immovable property could be sold, leased or otherwise transferred in normal and fair completion."
39. The Supreme Court in Aggarwal & Modi Enterprises (P) Ltd. & Anr. (supra) has interpreted the said Section as under:-
18. For appreciating the true scope and ambit of Section 141(2), it is to be noted that by nature of the proposed changes it has to be treated as fresh transaction
particularly when not only the nature of property changes but also the lease has expired. Though strong reliance was placed on a Resolution dated 18-3-1999 by the appellants, it is to be noted that the said resolution has practically no effectiveness in 2006.
xxx xxx xxx
22. The mandate of Section 141(2) is that any immovable property belonging to NDMC is to be sold, leased, licensed or transferred on consideration which is not to be less than the value at which such immovable property could be sold, leased, or transferred in fair competition. The crucial expression is "normal and fair competition". In other words, NDMC is obligated to adopt the procedure by which it can get maximum possible return/consideration for such immovable property. The methodology which can be adopted for receiving maximum consideration in a normal and fair competition would be the public auction which is expected to be fair and transparent. Public auction not only ensures fair price and maximum return it also militates against any allegation of favouritism on the part of the Government authorities while giving grant for disposing of public property. The courts have accepted public auction as a transparent means of disposal of public property. (SeeState of U.P. v. Shiv Charan Sharma, Ram & Shyam Co. v. State of Haryana, Sterling Computers Ltd. v. M & N Publications Ltd., Mahesh Chandra v. Regional Manager, U.P. Financial Corpn., Pachaiyappa's Trust v. Official Trustee of Madras, Chairman and MD SIPCOT v. Contromix (P) Ltd., New India Public School v. HUDA, State of Kerala v. M. Bhaskaran Pillai and Haryana Financial Corpn. v. Jagdamba Oil Mills.)"
(emphasis supplied)
40. This Court is of the view that the expression „transfer‟ is of wide amplitude and the definition of transfer under Income Tax Act cannot
be imported into the NDMC Act. In fact, this Court in Kanakdhara Credits Pvt. Ltd. vs. Mukesh Kapil & Another, CS(OS) 2670/2011 decided on 9th May, 2013 has held as under:-
"20. In the opinion of this Court, the expression „transfer‟ as used in Clause 2 of the Special Power of Attorney is of extremely wide amplitude. In Black‟s Law Dictionary, Ninth Edition, the expression „transfer‟ is stated to mean "any mode of disposing of or parting with an asset or an interest in an asset, including a gift, the payment of money, release, lease, or creation of a lien or other encumbrance........the term embraces every method--direct or indirect, absolute or conditional, voluntary or involuntary--of disposing of or parting with property or with an interest in property."
41. It is settled law that a policy to be legal and valid has to be in conformity with the statute. Keeping in view the mandate of Section 141(2) of the NDMC Act, this Court is of the view that the 1999 Estate Policy of NDMC cannot be interpreted to hold that licence of a commercial complex like a restaurant has to be renewed after expiry of every ten years only on a nominal increase of licence fee of 10%.
42. Mr. Chandhiok‟s submission that the judgment in Aggarwal & Modi Enterprises (P) Ltd. & Anr. (supra) is per incuriam cannot be accepted as it does not satisfy the test for the same i.e. it is not given in ignorance of terms of a statute or of a rule having force of a statute. In any event, the Supreme Court in a recent decision in South Central Railway Employees Cooperative Credit Society Employees Union vs. B. Yashodabai and Others, (2015) 2 SCC 727 has held as under:-
"14. We are of the view that it was not open to the High Court to hold that the judgment delivered by this Court
in South Central Railway Employees Coop. Credit Society Employees' Union v. Registrar of Coop. Societies [South Central Railway Employees Coop. Credit Society Employees' Union v. Registrar of Coop. Societies was per incuriam.
15. If the view taken by the High Court is accepted, in our opinion, there would be total chaos in this country because in that case there would be no finality to any order passed by this Court. When a higher court has rendered a particular decision, the said decision must be followed by a subordinate or lower court unless it is distinguished or overruled or set aside. The High Court had considered several provisions which, in its opinion, had not been considered or argued before this Court when CA No. 4343 of 1988 was decided [South Central Railway Employees Coop. Credit Society Employees' Union v. Registrar of Coop. Societies. If the litigants or lawyers are permitted to argue that something what was correct, but was not argued earlier before the higher court and on that ground if the courts below are permitted to take a different view in a matter, possibly the entire law in relation to the precedents and ratio decidendi will have to be rewritten and, in our opinion, that cannot be done. Moreover, by not following the law laid down by this Court, the High Court or the subordinate courts would also be violating the provisions of Article 141 of the Constitution of India.
16. We do not want to go into the arguments advanced by the learned counsel appearing for the respondents before the High Court for the simple reason that it was not open to them to advance any argument which would run contrary to the judgment delivered by this Court in South Central Railway Employees Coop. Credit Society Employees' Union v. Registrar of Coop. Societies [South Central Railway Employees Coop. Credit Society Employees' Union v. Registrar of Coop. Societies. In our opinion, the High Court did something which would be like setting aside a decree in the execution proceedings."
(emphasis supplied)
43. Consequently, this Court is of the view that plaintiff is not entitled to any relief from this Court. In fact, this Court is prima facie of the view that the present plaint is not maintainable as it is barred by law and the issues raised in the plaint are no longer res integra.
However, this Court shall decide on this aspect after pleadings are complete in the present case.
44. With the aforesaid observations, present application is dismissed and the interim arrangement, if any, stands vacated. CS(OS) 618/2015 List on the date already fixed.
MANMOHAN, J APRIL 10, 2015 js/rn
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