M/S Atma Ram Properties Pvt. Ltd. vs Union Of India
2017 Latest Caselaw 5772 Del

*             IN THE HIGH COURT OF DELHI AT NEW DELHI

+                          RSA No. 245/2017
%                                                   23rd October, 2017

M/S ATMA RAM PROPERTIES PVT. LTD.          ..... Appellant
                 Through: Mr. Amit Sethi and Mr. Ishan
                           Khanna, Advocate.

                           versus

UNION OF INDIA                                         ..... Respondent

                           Through:      Mr. Rajesh Gogna and Ms. Liu
                                         Gangmei, Advocates.

CORAM:
HON'BLE MR. JUSTICE VALMIKI J.MEHTA

To be referred to the Reporter or not?

VALMIKI J. MEHTA, J (ORAL)

C.M. Appl. No. 37328/2017 (for exemption)

Exemption allowed, subject to all just exceptions.

The application stands disposed of.

RSA No. 245/2017 and C.M. Appl. No. 37329/2017 (for stay)

1.(i) This Regular Second Appeal is filed under Section 100 of

the Code of Civil Procedure, 1908 (CPC) against the judgment of the

first appellate court dated 30.5.2017 by which the first appellate court

has set aside the judgment of the trial court dated 6.3.2010 and by

which judgment the trial court had decreed the suit for declaration and

permanent injunction which was filed by the plaintiffs in the suit and

who are now represented by the present appellant/company. I may

note that the present appellant/company is the successor-in-interest of

the original two plaintiffs in the suit, namely, Commander M.R.A.

Rao and his wife Ms. Indu A. Rao. The present appellant/company

purchased rights in the suit property in terms of a registered sale deed

dated 5.8.1998 registered as document no. 338 in additional book no.

1 Volume 170, pages 131-149 on 10.2.1999. Present appellant on

purchasing the suit property filed an application under Order XXII

Rule 10 CPC for being substituted as the plaintiff in the suit, and this

application was allowed by the trial court vide its order dated

11.10.2000, and which order admittedly has become final as it was not

challenged by the respondent. The order dated 11.10.2000 reads as

under:-

"Pr: Sh. L.L. Garg cl. For the applicant of the application 22 rule 10 Deft. Is already ex parte.

After hearing the arguments on the application of the applicant u/o 22 Rule 10 and carefully going to the registered sale deed in favour of the applicant, I am of the considered opinion that as the pltfs. has transferred the entire interest in the suit property in favour of the applicant that is Atma Ram Property Pvt. Ltd., therefore, the applicant should be substituted in place of the pltfs.

I order accordingly.

Now to come up for filing amended plaint on 29.11.2000."

(ii) Reference, therefore, in this judgment to the plaintiffs will

include, wherever the context so requires, reference to the original

plaintiffs or the present plaintiff and which is the appellant/company.

2. The plaintiffs filed the subject suit for declaration and

permanent injunction seeking the following reliefs:-

"(i) issue a declaration or other appropriate order or direction to the effect that the Defendants are not entitled to recover from the plaintiffs sums in excess of the 1980 figures of Rs.19949 as ground rent when the lease is due for renewal in September, 1990;

(ii) issue a declaration or other appropriate order or direction that the Defendants are not entitled to levy or revise or enhance or alter at periodic intervals the supposed charges for sanction for commercialization;

(iii) issue a declaration that the Defendants are legally obliged to calculate and levy/enhance the sum of money for granting of sanction on a reasonable and proper basis after disclosure of the entire data, facts, figures, basis, methodology, calculation and modality of arriving at the figures for ground rent and premium;

(iv) that a decree for permanent injunction be passed restraining the Defendants or its agents, employees/servants or nominees either from levying or increasing ground rent and premium beyond the 1980 figures of Rs.19,749 and Rs.99,745 respectively and/or to restrain them from interfering in the ownership; control and the possession of the property.

(v) pass a decree for permanent mandatory injunction or other order or direction directing grant of previous consent/sanction for commercial user on a permanent basis without further enhancement of rent or premium.

(vi) pass mandatory injunction directing rent of permanent consents/sanction for commercial user on the basis of ordinary commercial purposes and not lucrative purposes;

(vii) pass a direction or other order directing refund to the Plaintiffs of all excess amounts paid up to date to the Defendant;

(viii) fix a reasonable and appropriate annual ground rent and premium to be charged by the Defendant from the Plaintiffs;

(ix) refer, if necessary, any constitutional or other significant legal issues arising in the present suit to an appropriate constitutional court as provided in the Civil Procedure Code;

       (x)       award costs of the suits to the Plaintiffs;
       (xi)      direct payment of interest by the Defendants on any amounts held

to be refundable or due to the Plaintiff from the date of receipt of those amounts by the Defendants, till the date of realization;

(xii) alternatively, appoint a suitable person, valuer, assessor or arbitrator to determine the correct and reasonable figure to be charged/recovered from the Plaintiffs on account of land rent & premium;

(xiii) pass such other further orders or direction as this Hon'ble Court may deem fit, just proper and necessary in the facts and circumstances of the case."

3. Disputes and differences had arisen between the plaintiffs

and the respondent/Union of India (Cantonment Board) being the

superior lessor of the suit premises which is an area of 997.45 sq.

meters situated at 21, Maude Road (Thimaya Marg), Delhi

Cantonment, Delhi. The original plaintiffs/Raos were lessees of a

larger plot of land of 3616.91 sq. meters. The land was originally let

out by the respondent for residential purposes. With respect to suit

land being 997.45 sq. meters forming part of the total land of 3616.91

sq. meters, permission was given by the respondent for user of this

land for banking purposes vide permission letter dated 18.9.1980 and

subject to payment of additional rent of Rs.19949/- per annum with a

premium of Rs.99745/-. We are concerned for the purpose of this

present litigation only with land comprised in area of 997.45 sq.

meters and which has been carved out of the original total land of

3616.91 sq. meters and allowed to be used for commercial purposes

viz. banking purposes.

4. Respondent/defendant contested the suit and pleaded that

the claim made by the plaintiffs in the suit for challenging the

enhancement of commercial user charges was misconceived and the

suit had to be dismissed. Issue arose between the parties therefore as

to what should be the commercial user charges which the

respondent/defendant claimed it was entitled to and the denial by the

original plaintiffs of disentitlement of the respondent/defendant to

seek enhancement of commercial user charges after the first

permissible commercial usage period of five years. On account of the

present appellant/company being substituted as plaintiff an issue also

arose as to whether the appellant/company has proved its title to the

suit premises.

5. The following issues were framed in the suit:-

"I. Whether the plaintiff is entitled to decree of injunction and defendants can be restrained from dispossessing the plaintiff from the suit land? OPP II. Whether the demand raised by the defendant can be declared null and void as being against the contract and if so at what rate and for what period, the plaintiff is entitled? OPP III. Whether the plaintiff is entitled for decree of declaration that his name be mutated? OPD IV. Relief."

6. As regards the issue as to whether the appellant/company

would stand substituted for the original plaintiffs, the first appellate

court has held this issue against the appellant/company on the ground

that appellant/company has failed to file any document to show how

the appellant/company derived title to the suit premises on account of

its transfer by the original plaintiffs/Raos to the appellant/company.

Accordingly, it was held by the first appellate court that the present

appellant/company could not be said to have any locus standi to

continue with the suit as it had failed to prove any ownership title to

the suit premises. The second issue which arose was with respect to

the claim of enhanced commercial user charges as claimed by the

respondent/defendant. In this regard the trial court has held that only

in terms of admitted lease deed dated 20.12.1978 between the original

plaintiffs and the respondent/defendant, the respondent/defendant had

a right to claim charges. Counsel for the appellant/company however

concedes before this Court that in fact appellant/company agrees to

comply with the demands raised by the respondent/defendant for the

commercial user charges in terms of the extant circulars etc issued by

the respondent/defendant from time to time.

7.(i) At this stage, let me reproduce the operative portion of

the para of the judgment of the trial court dated 6.3.2010 and which

para 11 reads as under:-

"11. Relief:- In view of the above observations instant suit is decreed in favor of the plaintiff and against the defendant with cost and the defendant is restrained from dispossessing the plaintiff from the suit land/property and further directed to accept the cheque/draft in terms of the calculation mentioned above and not to raise any enhanced amount in future except in terms of lease deed as above upto 2063. The defendant is also directed to mutate the name of plaintiff as owner in their records on deposit of the arrears as per calculations made in issue no. 2. The defendant will calculate the amount within 15 days from today and the plaintiff will deposit the amount within one month from date of this judgment. If the defendant does not give any calculation to the plaintiff he will be at liberty to deposit the amount as per the calculation ordered in the judgment. During the course of the argument the plaintiff has even suggested that he is ready to make the payment as demanded by the defendant which is under challenge and as tendered by them earlier to avoid the controversy without prejudice to their rights and in these circumstances, the defendant is directed to receive that amount as the same is as per their calculation, (though it is not entitled to the same) and in these circumstances carry out the mutation forthwith. Decree sheet be prepared. File be consigned to record room."

(ii) It is therefore seen that the appellant/company no longer

disputes that whatever are the charges which the respondent/defendant

would claim for permitting commercial user of the suit premises, the

appellant/company would pay the same, and for which purpose certain

different directions were given to the respondent/defendant by the trial

court to calculate the amount within fifteen days and which amount

thereafter the appellant/company was to pay.

(iii) Appellant/company says that after the disputes arose and certain

payments were made by the original plaintiffs and the present

appellant/company, the same were received by the

respondent/defendant but the respondent/defendant did not encash the

banking instruments which were given by the appellant/company to

the respondent/defendant.

8. Therefore, no longer there remains any dispute between

the parties of any challenge by the appellant/company to whatever

would be the claim of the respondent/defendant for permitting the

appellant/company to use the suit premises for commercial purposes.

I may note that the respondent/defendant will charge the

appellant/company such commercial charges which are payable from

the date the respondent/defendant has not received the commercial

charges with respect to the suit property and the charges claimed will

be in terms of its policies which were extant from time to time and till

date. Really therefore, in fact, no substantial question of law needs to

be framed or decided on this aspect because the admitted fact which

emerges is, and which was not decided by the first appellate court, that

the appellant/company will pay all charges for commercial user of the

suit property, in terms of the policies, circulars etc which were issued

by the respondent/defendant from time to time. Respondent/defendant

is now directed within a period of eight weeks from today to issue a

demand letter to the appellant/company giving the details of the

calculations for each year and month of the amounts which would be

payable by the appellant/company for commercial user of the suit

property. The demand letter of the respondent/defendant must, besides

stating the calculations, be accompanied by the relevant policies and

the circulars specifying as to how the calculations have been made by

the respondent/defendant for its claim of commercial charges for the

relevant particular period specifying the particular month and year of

the claims. On the appellant/company receiving the aforesaid demand

letter, the appellant/company will within a period of three months

thereafter pay the charges as are claimed by the respondent/defendant.

This disposes off the issue between the parties as regards the claim of

commercial user charges or enhanced commercial user charges by the

respondent/defendant with respect to the suit property being allowed

to be used for commercial purposes.

9. The only issue which now remains is as to whether the

appellant/company has validly purchased rights in the suit property

from the original plaintiffs, and who were the original lessees of the

suit property. The Indenture of Lease in this regard is the Indenture of

Lease dated 20.12.1978. The case argued by the respondent/defendant

is under two heads. Firstly, it is pleaded and argued by the

respondent/defendant that the appellant/company is not the legal

successor-in-interest of the original plaintiffs in the suit as document

of title has not been proved, and secondly that there could not be any

transfer by the original lessees/original plaintiffs/Raos in favour of the

present appellant/company without taking prior permission of the

respondent/defendant. Let us examine these aspects as these would be

the substantial questions of law which are required to be framed and

decided for determination of this second appeal. The following

substantial questions of law are framed:-

(i) Whether the first appellate court has not committed a complete illegality and perversity in holding that a prior permission is required from the respondent/defendant before the original plaintiffs/Raos transferred their rights in the suit property to the present appellant/company, inasmuch as, there is no such clause in the Indenture of Lease dated 20.12.1978 which requires prior permission to be taken by the original plaintiffs/Raos for transfer of their rights in the suit property to the present appellant/company?

(ii) Whether the first appellate court has not committed a complete illegality and perversity in holding that the appellant/company had failed to prove transfer of title in its favour by the original plaintiffs, inasmuch as the appellant/company had not only filed the copy of the registered sale deed dated 5.8.1998 in its favour but also the fact is that the order dated 11.10.2000 passed by the trial court had become

final and which order had accepted transfer of the title to the present appellant/company from the original plaintiffs in the suit?

10. So far as the first substantial question of law as to

whether any prior permission was required, let me reproduce the

relevant clause I(8) which is relied upon by the respondent/defendant

as to whether such a clause requires any prior permission by the

original lessees/original plaintiffs before transferring their rights in the

suit property to the present appellant/company. Appellant/company

has argued that by virtue of the self-same clause I(8) that no prior

permission is required. This clause I(8) reads as under:-

"(8) 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 MEO setting forth the names and descriptions of the parties to every such assignment, transfer or sub-lease and the particulars and effect thereof."

11. In my opinion, the contention urged on behalf of the

respondent/defendant is completely misconceived that clause I(8)

requires any prior permission. All that this clause requires is that upon

the transfer/assignment or sub-lease of the suit premises by the

original lessees/original plaintiffs/Raos, then, only a notice of

assignment/transfer or the sub-lease is required to be given to the

respondent/defendant with the details of the assignment/transfer/sub-

lease. I do not find even remotely any language in clause I(8) which

requires any prior permission of the respondent/defendant before

transfer of rights by the lessee(s) to anyone including the present

appellant/company. I may note that this clause I(8) has to be

distinguished from those other clauses which exist in lease deeds

which are executed by the DDA/L&DO (Union of India) and as per

which clause there is an absolute bar to transfer the property by a

lessee to a third person and which absolute bar is removed only on the

payment of 50% of unearned increase to the DDA/L&DO.

Accordingly, the first substantial question of law is answered in favour

of the appellant/company by holding that clause I(8) of the lease deed

does not envisage any prior permission being taken from the

respondent/defendant by the lessees of the property before the lease

held rights are transferred by the lessees to a third person such as the

appellant/company.

12. The second aspect with respect to the second substantial

question of law framed above is that whether the appellant/company

has proved its title to the suit premises. In this regard, in my opinion,

the defence of the respondent/defendant is frivolous to say the least

because the appellant/company has purchased the suit property in

terms of the registered sale deed dated 5.8.1998 and detailed

particulars of which have been given above. Not only that, this sale

deed has been the basis for the trial court to allow the application

under Order XXII Rule 10 CPC filed by the appellant/company, and

which was allowed vide the order of the trial court dated 11.10.2000

already reproduced above. This order dated 11.10.2000 makes note of

the going through of the registered sale deed in favour of the

appellant/company and consequently allowing the appellant/company

to be substituted in place of the original plaintiffs. This order dated

11.10.2000 has become final as it was not challenged by the

respondent/defendant. Even if I am called upon to decide this issue,

then, in my opinion, this issue has to be decided in favour of the

appellant/company as the trial court had gone through the registered

sale deed, a copy of which was filed by the appellant/company before

the trial court. As a matter of abundant caution I also direct that the

appellant/company will on a date and time to be fixed by the

concerned officer of the respondent/defendant, take the original sale

deed with certified copy thereof for being given to the concerned

authority of the respondent/defendant and the concerned authority of

the respondent/defendant, at that stage can verify the original sale

deed executed by the original plaintiffs/Raos in favour of the present

appellant/company. The second substantial question of law is also

therefore answered in favour of the appellant/company and against the

respondent/defendant.

13. In view of the above, this Regular Second Appeal is

allowed by answering the substantial questions of law in favour of the

appellant/company. The respondent/defendant in terms of the present

judgment will now issue the demand letter to the appellant/company

within a period of eight weeks from today and the appellant/company

will comply with the demand letter by making payment to the

respondent/defendant within a period of three months thereafter.

Parties are left to bear their own costs.

OCTOBER 23, 2017                            VALMIKI J. MEHTA, J
AK/Ne