Dena Bank Vs.
Municipal Corpn. of Delhi  INSC 1645 (26 September 2008)
JURISDICTION CIVIL APPEAL NO.5878 OF 2008 (Arising out SLP(C) No.586 of 2007)
DENA BANK Appellant(s) Versus MUNICIPAL CORPN. OF DELHI Respondent(s) ORDER
of the judgment and order dated 14.2.2006 passed by the learned Single Judge of
the High Court of Delhi at New Delhi, is in question in this appeal which
arises out of the judgment and order dated 8.2.1996 passed by the Additional
District Judge, Delhi acting as the appellate authority, under the provisions
of the Public Premises (Eviction of Unauthorised Occupants) Act, 1971 (in
short, "the Act") setting aside the order of the Estate Officer dated
6.4.1992 directing eviction of appellant herein. Appellant was a licensee of
the Municipal Corporation of Delhi (Respondent) in respect of Shop Nos. 48-49,
Lodhi ..2/- .2.
Market, New Delhi. The period of licence was said to be for a period of five
years. The licence fee, according to the respondent was determined at
Rs.3,000/- per month per shop. Upon expiry of the period of licence i.e. on
15.2.1989, the licence fee was enhanced to Rs.6,000/- for each shop. Appellant
refused to pay the said enhanced amount of licence fee. A request for renewal
of the period of lease in respect of the said premises allegedly had not been
On the aforementioned
premise, proceeding in terms of Sections 4 and 5 of the said Act was initiated
before the learned Estate Officer, who, by an order dated 6.4.1992, directed
eviction of appellant in terms of Section 5 of the Act. In exercise of its
power under Section 7 of the said Act the appellant was furthermore directed to
pay damages at the rate of Rs.12,000/- per month with effect from 7.2.1989
amounting to Rs.1,14,000/- upto 17.8.1990 together with interest at the rate of
18% per annum. The Appellate Authority, however, reversed the said decision
opining as under :
the M.C.D. had examined only one witness namely Shri Narender Kumar, dealing
assistant in its Land and Estate Department who admitted in his cross
examination that the appellant being a tenant rent cannot be increased. The
E.O. has totally ignored the said admission of the ..3/- .3.
witness examined by
the MCD. Even otherwise I am of the opinion that the demand of the MCD for 100%
increase in the then existing licence fee as a term for renewal of licence is
highly unjustified, unreasonable and unconscionable.
There was no such
clause in the original allotment letter regarding increase of licence fee by
100% after expiry of initial five years of the said licence/lease. It has been
submitted by the counsel for the appellant that the appellant has been regularly
paying agreed licence fee to the MCD and there is no default on this account. I
am of the opinion that the unilateral decision of the MCD to hike the licence
fee by 100% cannot be thrusted upon the appellant without giving him an
opportunity to proper hearing on this aspect of the matter."
Respondent filed a
writ petition before the High Court under Article 227 of the Constitution of
India, which by reason of the impugned judgment, has been allowed by a learned
Single Judge of the said Court inter alia opining as under :
"It appears to
me that in the pleadings before the learned Estate Officer, the MCD had
specifically taken a plea in paragraph 8 that vide order dated 8.1.1990 the
licence stood cancelled and proceedings under the Public Premises Act for
realisation of damages and for use and occupation were initiated. Narender
Kumar in his examination in chief refers to such a Resolution as also the order
dated 8.1.1990 cancelling the licence. In cross-examination, this witness has
not been confronted with his statement that there was no such order dated
8.1.1990, however he has been asked whether there was any justification in
increase of rent to which he replied in the negative. It is this statement of
Narender Kumar which the ..4/-
Appellate Court has
sought to rely upon to say that "the increase in rent cannot be insisted
upon." To my mind, such a deduction from the statement of Narender Kumar
is not warranted. The original licence was for a period of five years and could
be renewed on terms and conditions mutually agreed upon. Since the terms and
conditions were not mutually agreed upon, the licence stood terminated by flux
of time. That being the position, the learned Estate Officer was well within
his right to impose a rate for use and occupation of the premises beyond the
period of licence. I am also of the view that the Additional District Judge was
not right in condemning the MCD for seeking an increase in the existing licence
fee. This is a matter between the contracting parties and it is not for the
Court to justify or adjudicate upon its correctness. Consequently, I am of the
view that the order dated 8.2.1996 is not based on sound reasoning."
Chinnasamy,learned counsel appearing on behalf of the appellant contends that
the judgment of the Appellate Authority being a reasoned one, the High Court
acted illegally and without jurisdiction in interfering therewith in exercise
of its jurisdiction under Article 227 of the Constitution of India.
Mr. Nagendra Rai,
learned senior counsel appearing on behalf of the respondent, on the other
hand, supported the impugned judgment.
The basic fact of the
matter is not much in dispute. Shops nos. 48-49 were allotted to the appellant
on a licence basis for a period of five years with effect from 1.2.1984. On the
expiry of the said period of five years respondent asked for 100% increase in
rent with retrospective effect. Indisputably, appellant refused to accede to
the said request resulting in initiation of the proceedings under the Act.
request of the appellant for renewal of the said period of licence have not
been acceded to.
Section 2(g) of the
Act defines "unauthorised occupation", in relation to any public
premises, means the occupation by any person of the public premises without
authority for such occupation, and includes the continuance in occupation by
any person of the public premises after the authority (whether by way of grant
or any other mode of transfer) under which he was allowed to occupy the
premises has expired or has been determined for any reason whatsoever."
The said definitionbeing an inclusive one is of wide importance. The
construction of the said provisions came up before the Constitution Bench of
this Court in Ashoka Marketing Ltd. & Anr. vs. Punjab National Bank &
Ors. reported in 1990 (4) SCC 406, wherein it was held :
of the expression 'unauthorised occupation' contained in Section 2(g) of the
Public Premises Act is in ..6/- .6. two parts. In the first part the said
expression has been defined to mean the occupation by any person of the public
premises without authority for such occupation. It implies occupation by a
person who has entered into occupation of any public premises without lawful
authority as well as occupation which was permissive at the inception but has
ceased to be so. The second part of the definition is inclusive in nature and
expressly covers continuance in occupation by any person of the public premises
after the authority (whether by way of grant or any other mode of transfer)
under which he was allowed to occupy the premises has expired or has been
determined for any reason whatsoever. This part covers a case where a person
had entered into occupation legally under valid authority but who continues in
occupation after the authority under which he was put in occupation has expired
or has been determined. The words "whether by way of grant or any other
mode of transfer"
in this part of the
definition are wide in amplitude and would cover a lease because lease is a mode
of transfer under the Transfer of Property Act. The definition of unauthorised
occupation contained in Section 2(g) of the Public Premises Act would
therefore, cover a case where a person has entered into occupation of the
public premises legally as a tenant under a lease but whose tenancy has expired
or has been determined in accordance with law."
Referring to a large
number of decisions of this Court it was held that unauthorised occupation will
include occupation by a tenant or a licencee after the expiry of the period of
Appellant has, thus,
been rightly evicted by the Estate Officer. The Appellate Authority, in our
opinion, could not have interfered with that part of the finding of the learned
So far as the
question as regards determination of the damages for occupation of the premises
by the appellant even after 1.5.1969 to 15.2.1986, however, is concerned, we
are of the opinion, keeping in view the fact that appellant did not agree to
the demand of respondent that the quantum of licence fee would be at the rate
of Rs.12,000/- per month, it was obligatory on the part of the Estate Officer
to determine the amount of damages upon consideration of the materials placed
before it by the parties.
He has not referred
to the materials brought on record by the parties, if any.
The demand made on
the part of the respondent by itself could not have been the determinative
factor so far as quantum of damages is concerned. For the said purpose, the
Estate Officer was required to give opportunity to the parties to lead
evidence. He should do so.
For the said purpose
only, the matter is remitted to the Estate Officer.
We make it clear that
all contentions of the parties in this behalf shall remain open.
The appeal is
accordingly, disposed of.
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