M/S Andaman Paints Pvt. Ltd. And ANR v. Estate Officer And ANR

IN THE HIGH COURT AT CALCUTTA

[ CIRCUIT BENCH AT PORT BLAIR ] *** CO/15/2024 M/s Andaman Paints Pvt Ltd and another Vs.

Estate Officer and another Mr. Arul Prasanth .... for the petitioners Mr. Shatadru Chakraborty Mr. Dibesh Dwivedi ... for the respondents June 11, 2024 [SR] Item No.10 The present challenge has been preferred against an order passed by the learned District Judge under Section 9 of the Public Premises (Eviction of Unauthorised Occupants) Act, 1971. The Estate Officer, in a proceeding initiated by the respondent authorities, had granted eviction of the petitioners primarily on the ground that the three leases between the parties had expired. It was also observed by the Estate Officer that the petitioners were using the property in question for residential purpose which was contrary to Clause 3 of the agreements, thereby entitling the respondents to have an eviction of the petitioners on termination of the leases.

The District Judge, in appeal, has affirmed the said findings. Learned counsel for the petitioners argues that three leases deeds were clubbed together for the purpose of obtaining the eviction order without specifying as to which of the properties was the subject matter of the alleged violation by the petitioners. Secondly it is argued that even as per documents which have been annexed to the writ petition, the ANIIDCO, and not the respondent authorities, was the owner in control, management and possession of the property and as such, the respondent authorities did not have any locus standi to initiate the proceeding for eviction.

residential possession of the premises in question. It is argued that all along the properties were being used for industrial purpose. As an aberration, during the Pandemic period, the petitioners were compelled to take shelter in a portion of the property as residential accommodation but subsequently vacated the residential accommodation.

It is further submitted that neither the Estate Officer nor the learned District Judge (Appellate Authority) took into consideration the contentions of the petitioners as made out in the reply to the show cause notice.

Learned counsel appearing for the respondent authorities submits that the concurrent findings of the authorities below ought not to be interfered with under Article 226 of the Constitution of India.

That apart, it is argued that Clause 9 of the agreements in question, which contemplates expiry of leases, may not be applicable in the present case in view of the operation of Causes 3, 4 and 5 which contemplate that the property has to be used for the specific purpose (industrial) for which it was let out to the petitioners. In the present case, it is argued, since the petitioners have admitted user for residential purpose, such clauses come into play and as such, the petitioners are not entitled to any compensation as valuation of the property in question.

It is thus argued that the provisions in Clause 9 of the agreements regarding the lessor taking over the buildings and other structures at a valuation mutually agreed upon between the parties cannot be attracted at all in view of the termination being in terms of clauses 3, 4 and 5 of the agreements.

The peculiar question which arises in the present case is whether the petitioners are entitled to resist eviction under the 1971 Act merely on the strength of Clause 9 of the agreements in question.

A careful scrutiny of the various clauses of the agreements indicates that the Clauses 3, 4 and 5 regarding user for other purpose than industrial, can only come into play prior to the natural death of the lease tenure.

It would be a contradiction in terms if the authorities claim that the jural relationship between the parties was deemed to be terminated for violation of Clause 3 after the jural relationship has already ceased to exist by expiry of the lease period. In the present case, the post facto afterthought of the respondents to club the allegation of violation of Clause 3 to the effect that the petitioners have used the property for residential purpose cannot be accepted, since such allegation is mutually exclusive with the allegation of the authorities, in the same breath, that the leases had already expired. This is because there could not be a cancellation/termination of leases which have already expired by efflux of time.

Since the show cause notice which was the initiation of the present proceeding under Section 5 of the 1971 Act itself was issued much after expiry of all the three lease deeds, it cannot be said that the termination/cancellation of the leases was on the ground of violation of Clause 3 of the agreement.

The natural corollary of the above deduction is that Clause 9 comes into play which envisages that in the event the lease is not renewed, the same shall ipso facto be determined at the expiry of the period of lease specified in Clause 1 and the land shall vest in the lessor free of all encumbrances.

The question which arises is whether the respondents are entitled to evict the petitioners and to take back possession without first offering the valuation of the property in terms of Clause 9. Upon a comprehensive perusal of the Clause 9, it is clear that the same has two components.

The first limb of the same says that in the event the lease is not renewed, it is deemed to be determined at the expiry of the

period of lease, the fallout of which is, as per such clause, that the land "shall vest in the lessor free of all encumbrances". Thus, the said sentence signifies that the respondents, upon expiry of lease, regain possession and title in the property free from all encumbrances. Possession of the petitioners is also an encumbrance and as such, comes within the blanket purview of the first limb of Clause 9. Thus, the right of the respondents to recover possession of the property upon evicting the petitioners is not dependent upon the pre-condition of payment of the valuation of the property and upon expiry by efflux of time, the subject-matter of the lease deeds reverts back automatically to the respondents.

However, nothing in the above observation takes away the right of the petitioners to claim compensation commensurate with the valuation of the property.

The second limb of Clause 9 provides that in a case where the lease expires and vests without encumbrances in the lessor, the lessor shall take over the buildings and other structures "at valuation to be mutually agreed upon between the parties". Thus, the respondents have the liability to make good the valuation of the property. In the present case, there is, thus, no fetter for the respondents to obtain possession of the property, if not on the ground of violation of Clause 3 read with Clauses 4 and 5 of the lease agreements but on the strength of Clause 9 of the agreements, on the expiry of the three leases.

Thus, the argument of the petitioners regarding nonspecification as to which property was the subject matter of violation of Clauses 3, 4 and 5 by residential user loses relevance, as in view of the expiry of the leases, the lease is automatically terminated and the property vested in the respondents by virtue of Clause 9. Insofar as the jurisdiction of the Estate Officer and the learned District Judge are concerned, this Court is of the opinion, in view of the above observations, that upon expiry of the leases, the petitioners come within the definition of 'unauthorized occupants' as envisaged in section 2 of the 1971 Act and as such, the respondent authorities acted well within their jurisdiction in initiating and

culminating proceedings for eviction of the petitioners under Section 5 of the 1971 Act.

Hence, I do not find any scope of interference with the impugned order.

Insofar as the ANIIDCO argument of the petitioners is concerned (regarding the respondents having no locus standi as ANIIDCO has become the owner of the property), the same does not find place in the reply to the show cause notice given by the petitioners.

It is rightly pointed by learned counsel for the respondents that the said reply succeeded on point of time the alleged notice by ANIIDCO and as such, the petitioners having not taken the said point in their reply, cannot now agitate the same for the first time either before this Court or even before the Appellate Authority. In the present case, although the petitioners had taken out an application under Order 41 Rule 27 of the Civil Procedure Code before the learned District Judge in the appeal under Section 9 of the 1971 Act, the same did not even mention the purported notice by ANIIDCO admitting that it is in possession and control of the property.

That apart, the point was never argued before any of the forums below, as evident from the impugned orders. Thirdly, any statement made by ANIIDCO, a third party, cannot bind the respondent authorities in any manner whatsoever, ipso facto precluding the respondents from taking out the eviction proceeding.

Thus, the arguments regarding ANIIDCO cannot be paid heed to, having not been made before the Estate Officer and no documents in that regard having been brought within the contemplation of Order 41 Rule 27 of the Code of Civil Procedure before the Appellate Authority.

In view of the above, CO/15/2024 is dismissed on contest without any order as to costs, thereby affirming the order of eviction passed by the authorities below.

However, it is made clear that it will be open to the petitioners to claim appropriate compensation commensurate with the valuation of the buildings and other structures on the land in question in terms of Clause 9 of the lease agreements.

In the event such claim is made by the petitioners, the respondents shall pay such compensation as agreed to by the respondents.

In the event of there being disagreement between the parties on the quantum of such valuation, it would be open to the aggrieved party to seek a reference to arbitration under Clause 9 of the agreements between the parties.

Urgent certified server copies, if applied for, be issued to the parties upon compliance of due formalities.

( Sabyasachi Bhattacharyya, J. )