Rupesh Kakkad vs Union Of India & Ors.
2015 Latest Caselaw 8102 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                      Date of decision: 28th October, 2015.

+                                W.P.(C) No.766/2012

       RUPESH KAKKAD                                        ..... Petitioner
                  Through:             Mr. Asuthosh Lohia, Ms. Soumya
                                       Kumar Mr. Sagar Chauhan, Advs.

                                    Versus

       UNION OF INDIA & ORS.                              ..... Respondents

                    Through:           Mr. Akshay Makhija, CGSC, Ms.
                                       Mahima Bahl, Ms. Sanju Geeta and
                                       Mr. Siddharth Thakur, Advs.
CORAM:
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

1. The petition impugns the order dated 29th December, 2011 of the

respondents Union of India (UOI), Joint Secretary (C&W), Defence Finance

and Defence Estate Officer Cantonment Board rejecting the request of the

petitioner for mutation of property, being leasehold plot of GLR Survey

No.73/2, Varanasi Cantonment, to the name of the petitioner. Axiomatically,

a mandamus is sought for mutation in the name of the petitioner.

2. The petition was entertained and the respondents have filed a counter

affidavit to which a rejoinder has been filed by the petitioner. The petitioner,

in compliance of the order dated 1st April, 2013 in this proceeding, has filed

an additional affidavit and to which a response has been filed by the

respondent. The respondent has filed yet another supplementary affidavit in

pursuance to the order dated 26th November, 2014 in this proceeding. The

petitioner is stated to have filed a response to the said supplementary

affidavit of the respondents but which is not on record. The counsel for the

petitioner states that he is not pressing for the same to be considered. The

counsels have been heard.

3. The position which emerges is as under:-

A. The land ad measuring 1.20 acres (52,272 sq. ft.) bearing GLR

Survey No.73/2 Varanasi Cantonment was initially leased to

Shri Gurucharan Prasad and Shri Jagannath Prasad w.e.f. 11th

January, 1932.

B. The leasehold rights in the aforesaid land were transferred to the

exclusive name of Shri Jagannath Prasad in pursuance to a

Partition Deed dated 24th August, 1948 between the said Shri

Gurucharan Prasad and Shri Jagannath Prasad and a

Supplementary Deed dated 15th July, 1949 was executed.

C. Pursuant to the user of the land being allowed to be changed,

another Supplementary Deed dated 14th May, 1963 was

executed.

D. Shri Jagannath Prasad died on 3rd August, 1973 and the

leasehold rights in the land aforesaid were inherited by his sons

Shri K.P. Saigal and Shri Shamboo Prasad Saigal and the

leasehold rights were mutated from the name of Shri Jagannath

Prasad to the name of his said sons.

E. Shri K.P. Saigal and Shri Shamboo Prasad Saigal, vide Sale

Deed dated 19th November, 1998 transferred leasehold rights in

respect of 17,008 sq. ft. out of the aforesaid land to Shri

Rajendra Kakkad, Sh. Illesh Kakkad, Sh. Rupesh Kakkad

(petitioner herein) and Sh. Nilesh Kakkad.

F. The aforesaid Sh. K.P. Saigal and Sh. Shamboo Prasad Saigal

vide Sale Deed dated 8th December, 2000 transferred the

leasehold rights in another 14,260 sq. ft. in favour of the

petitioner herein.

G. In this manner, Sh. K.P. Saigal and Sh. Shamboo Prasad Saigal

retained only 21,004 sq. ft. out of total leasehold land ad

measuring 52,272 sq. ft.

H. The petitioner applied for mutation in his name of leasehold

rights with respect to the aforesaid 14,260 sq. ft.

I The said application was rejected vide order dated 31 st January,

2011.

J. The petitioner filed W.P.(C) No.1773/2011 in this Court

impugning the aforesaid rejection.

K. This Court vide order dated 26th May, 2011 in the aforesaid writ

petition set aside the order dated 31st January, 2011 and

remanded the matter to the respondents for consideration afresh.

L. The respondents, vide impugned order dated 29th December,

2011, after reconsidering the matter have again rejected the

application of the petitioner for mutation. The reason therefor,

as borne out from paras 7 & 8 of the impugned order, is as

under:-

"7. The matter has since been re-examined in compliance of the order dated 26.05.2011 of the Hon'ble High Court in WP 1773/2011. After careful consideration of the records of the case, opinions of Director General of Defence Estates, Army Headquarters, Defence (Finance) and Legal Advisor (Defence), it is observed that sub- division of the property in favour of the petitioner and other purchasers would amount to creation of fresh leases. Disposal of fresh leases is governed by Rule 16 of CLAR, 1937. The Rule provides that an initial premium shall be charged on the lease and the lease shall be put up to public auction for sale to the person who agrees to pay the highest amount as premium. In the instant case since the due procedure of charging initial premium through

public auction is not getting followed, there is violation of Rule 16 of the CLA Rules, 1937. It is also observed that the premium which was due to the Government was taken by the lessee while transferring leasehold rights through sale deeds. Therefore mutation of property in favour of petitioner would result in heavy revenue loss to Government. It is also held that regularizing sub- division of the property located outside civil area is bound to become precedence for similar requests seeking regularization of sub-divisions in all 62 Cantonments which would result in proliferation of colonization of Cantonments thus affecting the overall security environment.

8. In view of the above, the request of the petitioner for mutation of the property cannot be acceded to."

(emphasis added)

4. On enquiry, it is informed that a separate application for mutation was

filed by the petitioner along with Shri Rajendra Kakkad, Sh. Illesh Kakkad

and Sh. Nilesh Kakkad with respect to 17,008 sq. ft. of land but the same is

still pending consideration.

5. On further enquiry, it is informed that the Lease Deed dated 11 th

January, 1932 has been extended from time to time and is now valid till the

year 2022.

6. The counsel for the petitioner has placed only the copy of the original

Lease Deed dated 11th January, 1932 before this Court and has not placed the

supplementary lease deeds aforesaid executed and / or the documents

executed for extension of the lease till 2022. However a perusal of the order

sheet shows that the original lease deed dated 11 th January, 1932 was

directed to be brought before this Court and was perused by this Court as is

borne out from the order dated 1st April, 2013.

7. On a reading of the impugned order what emerges is that the reason

for refusal of mutation is, that the same would amount to sub-division of

leasehold and which is not permissible. It has as such been straightaway

enquired from the counsel for the petitioner whether under the Lease Deed,

transfer of part of the land amounting to sub-division of the leasehold land is

permissible.

8. The counsel for the petitioner, though is unable to show any clause in

the lease deed permitting transfer by the lessee of a part of the leasehold

property and obliging the lessor to, upon such transfer, grant a separate lease

deed of the said part, however contends that since the lease deed, vide

Clause 1(8) thereof permits the lessee to sub-lease the property, the sub-lease

could be either of the entire leasehold property or of a part thereof and the

use of the word "sub-lease" indicates that if the lessee creates a sub-lease of

part of the property, the sub-lessee of the said part would be entitled to have

a separate lease deed executed from the lessor in his / her favour. It is

further contended that since the lessees i.e. Shri K.P. Saigal and Shri

Shamboo Prasad Saigal, under the Lease Deed are permitted to sub-lease the

leasehold premises, the permission for sub-division stood given. On further

enquiry, it is informed that there is no other provision or rule permitting the

sub-division of leasehold premises.

9. I am afraid, the counsel for petitioner is confusing „sub-lease‟ with

„sub-division,‟ when the two are entirely different. The original lessees were

not granted ownership rights in the land but only leasehold rights in the land.

A power to sub-lease would be a power to further lease out the leasehold.

The same would however not entitle the lessees to sub-divide the property

and to grant sub-lease of different portions of the sub-divided property to

different persons.

10. I have in this regard also considered whether there is any inherent

right in a lessee to sub-divide. The same, subject to the contract to the

contrary, is to be found in Section 108 (B) of the Transfer of Property Act,

1882 which vests a right in the lessee to transfer absolutely or by way of

mortgage or sub-lease the whole or any part of his interest in the property.

Therefrom also, the distinction between sub-lease and sub-division is borne

out. If sub-lease was to cover sub-division, the need for the words "whole or

any part of his interest in the property" would not have arisen.

11. However the lease is found to have been granted in favour of the

aforesaid Shri Gurucharan Prasad and Shri Jagannath Prasad by a Lease

Deed executed between them and the Secretary of State for India in Council.

The recital of the said lease records that the Cantonment Authority of

Banaras had executed the said lease deed on behalf of the Secretary of State,

with the conformation of the Government of India. The question would arise

whether the said lease would be a Government Grant in as much as if it is a

Government Grant, as per Section 2 of the Government Grants Act, 1895,

the provisions of the Transfer of Property Act would not be applicable

thereto. Thus, even if there were to be no prohibition in the lease deed

against a sub-division, in the absence of any clause permitting sub-division,

the lessee would still not have a right to sub-divide in as much as a

Government Grant is to be read as per its own terms.

12. Upon the same being put to the counsel for the petitioner, he invited

attention to Section 112 of the Cantonment Act, 1924 which only provides

that every Board i.e. Cantonment Board shall be competent to enter into and

perform any contract necessary for the purposes of that Act. I am unable to

see as to how the said provision would take away the character as is evident

on the face of the subject lease, of the same being a Government Grant, from

that of being a Government Grant. Once that is so, the question of

applicability of Section 108 of the Transfer of Property Act would not arise.

13. A similar question has often arisen in the city of Delhi in relation to

the leases granted by the Land & Development Office (L&DO) and the

Delhi Development Authority (DDA) and where the consistent view is that

no sub-division of the lease, which has an impact of changing the layout

plan, affecting the density and FAR available for construction, can be

permitted under a lease deed, save if permitted by the lessor i.e. L&DO or

the DDA.

14. The counsel for the petitioner has then argued that the reasoning given

in the impugned order, of sub-division amounting to a fresh lease deed, is

incorrect.

15. Once it is found that sub-division of the leasehold is not permitted,

and on which ground the mutation has been refused, the language used in the

impugned order does not make any difference. The authority concerned, in

the impugned order, has reasoned that allowing sub-division which is not

permitted would tantamount to grant of a fresh lease and which cannot be

done without auction. It cannot be said that the said reasoning is also de hors

of any merit. Once it is found that the right which the petitioner is claiming

is not borne out from the original lease, the creation of new rights would

undoubtedly amount to a new lease and which as per the consistent dictum of

the Supreme Court in Netai Bag Vs. The State of West Bengal (2000) 8

SCC 262, Sachidanand Pandey Vs. State of West Bengal (1987) 2 SCC 295

and Haji T.M. Hassan Rawther Vs. Kerala Finance Corporation (1988) 1

SCC 166 with respect to disposal of properties of the State can now be done

only by way of an auction.

16. No other argument has been raised.

17. Accordingly, the order dismissing the petition was dictated in open

Court.

18. However while correcting the order in the Chamber and going through

the file I found Clause 1(8) of the Lease Deed dated 11 th January, 1932 to be

as under:-

"1. And the lessees doth hereby covenant with the Secretary of State -

*(xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx xxxxxx upon every assignment transfer or sub-lease of the premises hereby demised or any part thereof or within one calendar month thereafter to deliver a notice of such assignment transfer or sub-lease to the Military Estates Officer setting forth the names and description of the parties to every such assignment transfer or sub-lease and the particulars and effect thereof.

__________________________________________ * The portion within brackets to be inserted if application*"

(emphasis added)

Therefrom it appeared that the lease permits the lessee to assign,

transfer or sub-lease either the entire leased premises "or any part thereof"

and which the counsel for the petitioner had failed to point out. Though the

said clause was referred to in the hearing and also perused in the Court but

the words "or any part thereof" therein escaped attention, perhaps owing to

the dim copy thereof annexed to the petition.

19. Accordingly, the counsels were telephonically contacted and asked to

appear the next day. In response thereof the counsel for the petitioner did not

appear himself and sent his colleague but without any instructions. The

counsel for the respondents appeared and agreed that vide clause aforesaid of

the lease deed, assignment, transfer or sub-lease of part of the leased

premises is permitted. He however contended that the same would also not

entitle the transferee, assignee or sub-lessee of the part of the leased premises

to an independent lease of that part from the lessor i.e. the respondents. It

was stated that the same would at best entitle the transferee, assignee or sub-

lessee of a part to have his name added to the name of the lessee.

20. There is still nothing before me to show that the petitioner is entitled

to mutation exclusively in his favour of only that part of the leasehold which

has been transferred to him. The petitioner, as aforesaid, can only have his

name added to that of the existing lessee in the records of the respondents.

21. However in this context, another argument of the counsel for the

respondents, of the lessee having not given intimation of transfer within the

time prescribed in Clause 1(8) of one calendar month becomes relevant.

22. I however find that the respondents, while rejecting the application of

the petitioner, have not given the said ground. It is thus not deemed

necessary at this stage to adjudicate whether the said time of one month

prescribed for intimating of assignment/transfer is of essence or not. Suffice

it is to state that no consequences, of violation thereof, are found to have

been prescribed in the lease deed.

23. The petition is accordingly allowed to the extent that subject to the

petitioner complying with the necessary formalities in this regard within a

period of three months from today, the respondents are directed to add the

name of the petitioner along with the names of the existing lessee with

respect to the lease aforesaid but on the condition that the petitioner thereby

would not become entitled to physical partition of the leasehold and the

respondents would be entitled to treat the entire leasehold as one only for all

purposes whatsoever.

No costs.

RAJIV SAHAI ENDLAW, J.

OCTOBER 28, 2015 „pp‟..